QUAKER CHEMICAL CORP 10-Q

Item 1. Financial Statements (Unaudited). Quaker Chemical Corporation Condensed Consolidated Statements of Operations (Unaudited; Dollars in thousands, except per share data) Three Months Ended March 31, 2026 2025 Net sales $ 480,479 $ 442,914 Cost of goods sold (excluding amortization expense - See Note 13) 303,744 281,654 Gross profit 176,735 161,260 Selling, general and administrative expenses 135,765 119,046 Restructuring and related charges, net 7,381 14,590 Operating income 33,589 27,624 Other expense, net ( 23 ) ( 709 ) Interest expense ( 9,879 ) ( 9,545 ) Income before taxes and equity in net income of associated companies 23,687 17,370 Taxes on income before equity in net income of associated companies 7,145 7,542 Income before equity in net income of associated companies 16,542 9,828 Equity in net income of associated companies 3,200 3,089 Net income 19,742 12,917 Less: Net income (loss) attributable to noncontrolling interest 73 ( 5 ) Net income attributable to Quaker Chemical Corporation $ 19,669 $ 12,922 Per share data: Net income attributable to Quaker Chemical Corporation common shareholders – basic $ 1.13 $ 0.73 Net income attributable to Quaker Chemical Corporation common shareholders – diluted $ 1.13 $ 0.73 Dividends declared $ 0.508 $ 0.485 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 2 Table of Content Quaker Chemical Corporation Condensed Consolidated Statements of Comprehensive Income (Unaudited; Dollars in thousands) Three Months Ended March 31, 2026 2025 Net income $ 19,742 $ 12,917 Other comprehensive income, net of tax Currency translation adjustments ( 9,913 ) 27,129 Defined benefit retirement plans 403 ( 265 ) Current period change in fair value of derivatives ( 13 ) ( 592 ) Unrealized loss on available-for-sale securities ( 166 ) ( 304 ) Other comprehensive (loss) income ( 9,689 ) 25,968 Comprehensive income 10,053 38,885 Less: Comprehensive income (loss) attributable to noncontrolling interest ( 82 ) 1 Comprehensive income attributable to Quaker Chemical Corporation $ 9,971 $ 38,886 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 3 Table of Content Quaker Chemical Corporation Condensed Consolidated Balance Sheets (Unaudited; Dollars in thousands, except par value) March 31, 2026 December 31, 2025 ASSETS Current assets Cash and cash equivalents $ 169,728 $ 179,829 Accounts receivable, net 441,167 417,157 Inventories Raw materials and supplies 128,739 124,751 Work-in-process and finished goods 153,769 141,025 Prepaid expenses and other current assets 59,196 58,428 Total current assets 952,599 921,190 Property, plant and equipment, at cost 611,149 604,787 Less: Accumulated depreciation ( 299,727 ) ( 291,364 ) Property, plant and equipment, net 311,422 313,423 Right-of-use lease assets 38,534 38,737 Goodwill 502,005 501,720 Other intangible assets, net 847,994 873,540 Investments in associated companies 106,192 106,915 Deferred tax assets 12,182 12,128 Other non-current assets 30,999 30,283 Total assets $ 2,801,927 $ 2,797,936 LIABILITIES AND EQUITY Current liabilities Short-term borrowings and current portion of long-term debt $ 37,301 $ 35,657 Accounts payable 205,386 198,929 Dividends payable 8,822 8,804 Accrued compensation 30,299 41,192 Accrued restructuring 9,482 8,351 Accrued pension and postretirement benefits 2,119 2,126 Other accrued liabilities 95,086 85,097 Total current liabilities 388,495 380,156 Long-term debt 837,132 834,901 Long-term lease liabilities 22,134 22,759 Deferred tax liabilities 131,922 140,814 Non-current accrued pension and postretirement benefits 20,191 20,615 Other non-current liabilities 22,902 22,192 Total liabilities 1,422,776 1,421,437 Commitments and contingencies (Note 18) Equity Common stock $ 1 par value; authorized 30,000,000 shares; issued and outstanding March 31, 2026 – 17,365,508 shares; December 31, 2025 – 17,331,779 shares 17,366 17,332 Capital in excess of par value 876,213 874,826 Retained earnings 607,463 596,616 Accumulated other comprehensive loss ( 125,359 ) ( 115,661 ) Total Quaker shareholders’ equity 1,375,683 1,373,113 Noncontrolling interest 3,468 3,386 Total equity 1,379,151 1,376,499 Total liabilities and equity $ 2,801,927 $ 2,797,936 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 4 Table of Content Quaker Chemical Corporation Condensed Consolidated Statements of Cash Flows (Unaudited; Dollars in thousands) Three Months Ended March 31, 2026 2025 Cash flows from operating activities Net income $ 19,742 $ 12,917 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation and amortization 25,640 20,599 Equity in undistributed earnings of associated companies, net of dividends ( 2,830 ) ( 2,769 ) Deferred income taxes ( 7,517 ) ( 3,340 ) Share-based compensation 3,170 3,182 Restructuring and related charges, net 7,381 14,590 Gain on disposal of property, plant and equipment and other assets — ( 2,148 ) Other adjustments 492 2,190 Increase (decrease) in cash from changes in current assets and current liabilities, net of acquisitions: Accounts receivable ( 25,480 ) ( 10,302 ) Inventories ( 18,437 ) ( 13,457 ) Prepaid expenses and other current assets ( 1,340 ) 245 Accrued restructuring ( 3,880 ) ( 9,045 ) Accounts payable and accrued liabilities 6,845 ( 15,712 ) Net cash provided by (used in) operating activities 3,786 ( 3,050 ) Cash flows from investing activities Investments in property, plant and equipment ( 10,656 ) ( 12,329 ) Payments related to acquisitions, net of cash acquired — ( 3,983 ) Proceeds from disposition of assets — 2,900 Other investing activities 1,126 — Net cash used in investing activities ( 9,530 ) ( 13,412 ) Cash flows from financing activities Payments of long-term debt ( 8,770 ) ( 8,523 ) Borrowings on revolving credit facilities, net 14,053 30,000 Borrowings (payments) on other debt, net 1,857 ( 773 ) Dividends paid ( 8,805 ) ( 8,572 ) Other stock related activity ( 1,749 ) ( 1,176 ) Net cash (used in) provided by financing activities ( 3,414 ) 10,956 Effect of foreign exchange rate changes on cash ( 943 ) 2,849 Net decrease in cash and cash equivalents ( 10,101 ) ( 2,657 ) Cash and cash equivalents at the beginning of the period 179,829 188,880 Cash and cash equivalents at the end of the period $ 169,728 $ 186,223 Supplemental cash flow disclosures: Non-cash activities: Accrued purchases of property, plant and equipment, net $ 7,794 $ 5,549 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 5 Quaker Chemical Corporation Condensed Consolidated Statements of Changes in Equity (Unaudited; Dollars in thousands, except per share amounts) Common Stock Capital in Excess of Par Value Retained Earnings Accumulated Other Comprehensive Loss Noncontrolling Interest Total Balance as of December 31, 2024 $ 17,674 $ 903,781 $ 633,731 $ ( 201,619 ) $ 616 $ 1,354,183 Net income (loss) — — 12,922 — ( 5 ) 12,917 Amounts reported in other comprehensive income — — — 25,964 4 25,968 Dividends ($ 0.485 per share) — — ( 8,574 ) — — ( 8,574 ) Share issuance and equity-based compensation plans, net 6 2,000 — — — 2,006 Balance as of March 31, 2025 $ 17,680 $ 905,781 $ 638,079 $ ( 175,655 ) $ 615 $ 1,386,500 Balance as of December 31, 2025 $ 17,332 $ 874,826 $ 596,616 $ ( 115,661 ) $ 3,386 $ 1,376,499 Net income — — 19,669 — 73 19,742 Amounts reported in other comprehensive (loss) income — — — ( 9,698 ) 9 ( 9,689 ) Dividends ($ 0.508 per share) — — ( 8,822 ) — — ( 8,822 ) Share issuance and equity-based compensation plans, net 34 1,387 — — — 1,421 Balance as of March 31, 2026 $ 17,366 $ 876,213 $ 607,463 $ ( 125,359 ) $ 3,468 $ 1,379,151 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 6 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Page Note 1 Basis of Presentation and Description of Business 8 Note 2 Business Acquisitions 8 Note 3 Recently Issued Accounting Standards 10 Note 4 Business Segments 11 Note 5 Net Sales and Revenue Recognition 13 Note 6 Leases 13 Note 7 Restructuring and Related Activities 15 Note 8 Share-Based Compensation 15 Note 9 Pension and Other Postretirement Benefits 16 Note 10 Other Expense , net 17 Note 11 Income Taxes 17 Note 12 Earnings Per Share 18 Note 13 Goodwill and Other Intangible Assets 18 Note 14 Debt 19 Note 15 Accumulated Other Comprehensive Income 21 Note 16 Fair Value Measurements 22 Note 17 Hedging Activities 22 Note 18 Commitments and Contingencies 23 7 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Note 1 – Basis of Presentation and Description of Business As used in these Notes to Condensed Consolidated Financial Statements of this Quarterly Report on Form 10-Q for the period ended March 31, 2026 (the “Report”), the terms “Quaker Houghton,” the “Company,” “we,” and “our” refer to Quaker Chemical Corporation (doing business as Quaker Houghton), its subsidiaries, and associated companies, unless the context otherwise requires. Basis of Presentation The condensed consolidated financial statements included herein are unaudited and have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) for interim financial reporting and the United States Securities and Exchange Commission (“SEC”) regulations. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the financial statements reflect all adjustments, which are of a normal recurring nature, necessary for a fair statement of the financial position, results of operations, and cash flows for the interim periods. The results for the three months ended March 31, 2026 are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the Company’s Annual Report filed on Form 10-K for the year ended December 31, 2025 (the “2025 Form 10-K”). Certain prior year amounts have been reclassified to conform to the current year presentation. Description of Business The Company was organized in 1918 and incorporated as a Pennsylvania business corporation in 1930. Quaker Houghton is the global leader in industrial process fluids. With a presence around the world, including operations in over 25 countries, the Company’s customers include thousands of the world’s most advanced and specialized steel, aluminum, automotive, aerospace, offshore, container, mining, and metalworking companies. Quaker Houghton develops, produces, and markets a broad range of formulated chemical specialty products and offers chemical management services, which the Company refers to as Fluidcare TM , for various heavy industrial and manufacturing applications sold in its three reportable segments: (i) Americas; (ii) Europe, Middle East and Africa (“EMEA”); and (iii) Asia/Pacific. Hyper-inflationary economies Argentina’s and Türkiye’s economies were considered hyper-inflationary under U.S. GAAP effective July 1, 2018 and April 1, 2022, respectively. As of and for the three months ended March 31, 2026, the Company’s Argentine and Turkish subsidiaries together represented approximately 1 % and 2 % of the Company’s consolidated total assets and net sales, respectively. During the three months ended March 31, 2026 and March 31, 2025, the Company recorded $ 0.2 million and $ 0.5 million of remeasurement losses associated with the applicable currency conversions, respectively. These losses were recorded within Other expense, net, in the Company’s Condensed Consolidated Statements of Operations. Note 2 – Business Acquisitions Previous Acquisitions Dipsol In April 2025, the Company acquired 100 % of the outstanding equity interests of Dipsol Chemicals Co., Ltd. and its subsidiaries, (“Dipsol”) for approximately $ 185.6 million ( 27.7 billion JPY), which included approximately $ 30.1 million ( 4.5 billion JPY) of acquired cash for a net purchase price of approximately $ 155.5 million ( 23.2 billion JPY). In July 2025, the Company satisfied all routine and customary post-closing conditions and finalized the purchase price with no adjustments. The Company funded the acquisition purchase price with borrowings under its existing credit facility. In connection with the acquisition of Dipsol, the Company entered into foreign currency forward contracts, which resulted in a $ 187.0 million cash payment and a $ 1.4 million foreign currency loss recognized during the year ended December 31, 2025. Dipsol is headquartered in Japan and is a leading supplier of surface treatment and plating solutions and services primarily for the automotive and other industrial applications end markets. Dipsol has operations in several countries and these operations are reported within the Company’s respective Americas, EMEA, and Asia/Pacific segments. This acquisition expands the Company’s advanced solutions businesses in attractive end markets with solid growth characteristics. Dipsol also provides significant cross-selling opportunities and enhances the Company’s ability to meet the needs of our customers across the globe. 8 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) The following table presents the fair values of Dipsol assets acquired and liabilities assumed as of the acquisition date: Dipsol Assets Acquired and Liabilities Assumed Dollars in thousands Estimated Fair Value (1) Fair value of assets acquired Cash and cash equivalents $ 30,084 Accounts receivable, net 16,481 Inventories 17,962 Prepaid expenses and other current assets 1,231 Property, plant and equipment, net 39,450 Right-of-use lease assets 2,534 Other intangible assets, net 55,000 Investments in associated companies 5,096 Deferred tax assets 989 Other non-current assets 4,165 Total Assets Acquired $ 172,992 Fair value of liabilities assumed Accounts payable $ 6,763 Accrued compensation 1,528 Other accrued liabilities 2,415 Long-term lease liabilities 1,446 Deferred income tax liabilities 25,836 Total Liabilities Assumed $ 37,988 Noncontrolling interest ( 2,451 ) Goodwill 53,059 Total Consideration $ 185,612 (1) The Company recorded approximately $ 0.2 million of measurement period adjustments during the year ended December 31, 2025 to reflect changes in net working capital and tax balances. All measurement period adjustments were offset against goodwill. As of March 31, 2026, the allocation of the purchase price has been finalized. The Company allocated $ 55.0 million of the purchase price to intangible assets across the Americas, EMEA, and Asia/Pacific segments. Customer relationships, product technologies, and trademarks will be amortized over 14 years, 8 years, and 13 years, respectively. The following table presents the intangible assets recognized for each reportable segment: Americas EMEA Asia/Pacific Total Customer Relationships $ 3,500 $ 200 $ 26,300 $ 30,000 Product Technologies — — 18,000 18,000 Trademarks — — 7,000 7,000 Total Intangibles $ 3,500 $ 200 $ 51,300 $ 55,000 The Company recognized $ 53.1 million of goodwill, which is comprised of $ 46.9 million in the Asia/Pacific segment, $ 5.8 million in the Americas segment, and $ 0.4 million in the EMEA segment. The goodwill is not deductible for tax purposes. The goodwill is primarily attributable to expected synergies. Total sales included in the Condensed Consolidated Statement of Operations for the three months ended March 31, 2026 is $ 19.1 million. 9 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Natech In April 2025, the Company acquired 100 % of the outstanding equity interests of Natech, Ltd., (“Natech”) for approximately $ 6.5 million, which includes an initial cash payment of $ 6.0 million and a deferred payment of $ 0.5 million, subject to routine and customary post-closing adjustments, including an adjustment for working capital. Assets acquired included cash and cash equivalents of $ 1.5 million. Natech is based in the United Kingdom and is a manufacturer of surface treatment chemicals for a variety of industrial applications. Natech is reported as part of the EMEA reportable segment. This acquisition strengthens Quaker Houghton’s overall surface treatment product and application capabilities within Europe. The Company allocated $ 2.1 million of the purchase price to intangible assets and recognized $ 2.6 million of goodwill in the EMEA segment, none of which is deductible for tax purposes. The goodwill is primarily attributable to expected growth synergies. During the third quarter of 2025, the Company settled the working capital adjustment for an immaterial amount. As of March 31, 2026, the allocation of the purchase price has been finalized. CSI In February 2025, the Company acquired 100 % of the outstanding equity interests of Chemical Solutions & Innovations (Pty) Ltd. (“CSI”), for approximately $ 3.9 million, subject to routine and customary post-closing adjustments, including an adjustment for working capital. CSI is based in South Africa and is a supplier of metalworking fluids and lubricants to the South African market. CSI is reported as part of the EMEA reportable segment. This acquisition strengthens Quaker Houghton’s position in South Africa and expands the Company’s presence in that region. The Company allocated $ 1.4 million of the purchase price to intangible assets and recognized $ 1.7 million of goodwill in the EMEA segment, none of which is deductible for tax purposes. The goodwill is primarily attributable to expected growth synergies. During the third quarter of 2025, the Company settled the working capital adjustment for an immaterial amount. As of March 31, 2026, the allocation of the purchase price has been finalized. The results of operations of Dipsol, Natech, and CSI subsequent to the acquisition dates are included in the unaudited Condensed Consolidated Statements of Operations for the three months ended March 31, 2026. During the three months ended March 31, 2026 and 2025, the Company recognized $ 0.7 million and $ 3.3 million, respectively, of acquisition-related expenses including legal, financial, consulting and other costs. These costs are included in Selling, general and administrative expenses (“SG&A”) in the Condensed Consolidated Statements of Operations. Certain pro forma and other information is not presented, as the operations of the acquired assets and businesses are not considered material to the overall operations of the Company for the periods presented. Note 3 – Recently Issued Accounting Standards Recently Adopted Accounting Standards The Company has adopted ASU 2023-09, Income Taxes (Topic 740) : Improvements to Income Tax Disclosures on a prospective basis in the 2025 Form 10-K. Pursuant to this ASU, the Company disclosed additional information in specified categories with respect to the reconciliation of the effective tax rate to the statutory rate (the “rate reconciliation”) for federal, state, and foreign income taxes, which required greater detail about individual reconciling items in the rate reconciliation to the extent the impact of those items exceeded a specified threshold. Additionally, the Company disclosed income taxes paid disaggregated by federal, state, and foreign taxes and further disaggregated these disclosures in certain jurisdictions where income taxes paid exceeded a certain threshold. See Note 10, Income Taxes , within the 2025 Form 10-K for additional information. Recently Issued Accounting Standards Not Yet Adopted The FASB issued ASU 2024-03, Income Statement- Reporting Comprehensive Income- Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses in November 2024 . This ASU requires PBEs to disclose, in interim and annual reporting periods, additional information about certain expenses in the notes to the financial statements, including disclosing the amounts of purchases of inventory, employee compensation, depreciation, and intangible asset amortization in each relevant expense caption. It also requires PBEs to disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively and to disclose the total amount of selling expenses, and in the annual reporting periods, an entity’s definition of selling expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the disclosure requirements of this standard and the impact on its condensed consolidated financial statements. 10 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) 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 in September 2025. This ASU removes all references to prescriptive and sequential software development stages and will now require PBEs to start capitalizing software costs when management has authorized and committed to funding the software project and it is probable that the project will be completed and the software will be used to perform the function intended. The ASU also specifies that the disclosures in Subtopic 360-10, Property, Plant, and Equipment- Overall are required for all capitalized internal-use software costs. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the disclosure requirements of this standard and the impact on its condensed consolidated financial statements. The FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements in December 2025. This ASU amends Topic 270, by improving the navigability of the required interim disclosures and clarifying when that guidance is applicable. The amendments also provide additional guidance on what disclosures should be provided in interim reporting periods. Additionally, the amendment requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the disclosure requirements of this standard and the impact on its consolidated financial statements. Note 4 – Business Segments The Company’s operating segments, which are consistent with its reportable segments, reflect the structure of the Company’s internal organization and the manner by which the CODM, which is the Company’s Chief Executive Officer, allocates resources and assesses performance. The CODM evaluates performance for the Company’s operating segments based on segment operating earnings. Segment operating earnings for each of the Company’s reportable segments are comprised of the segment’s net sales less directly related product costs and other segment items. Operating expenses not directly attributable to the net sales of each respective segment, such as certain corporate and administrative costs and restructuring charges, are not included in segment operating earnings. Other items not specifically identified with the Company’s reportable segments include Interest expense and Other expense, net. The CODM uses segment operating earnings to allocate resources for each segment predominantly in the annual budget and forecasting process. The CODM considers budget-to-actual variances on a monthly basis for segment operating earnings when making decisions about allocating capital and personnel to the segments. The CODM also uses segment operating earnings to assess the performance for each segment and in the compensation of certain employees. Segment asset information is not regularly provided to or reviewed by the CODM. Therefore, the Company does not disclose segment asset information for each reportable segment. 11 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) The following table presents information about the performance of the Company’s reportable segments for the three months ended March 31, 2026 and 2025: Americas EMEA Asia/Pacific Totals Three Months Ended March 31, 2026 Net sales (1) $ 213,728 $ 142,083 $ 124,668 $ 480,479 Significant segment expenses Product costs (2) 106,087 73,030 64,411 243,528 Other segment items (3) 53,694 43,492 25,981 123,167 Segment operating earnings $ 53,947 $ 25,561 $ 34,276 $ 113,784 Americas EMEA Asia/Pacific Totals Three Months Ended March 31, 2025 Net sales (1) $ 213,711 $ 129,278 $ 99,925 $ 442,914 Significant segment expenses Product costs (2) 104,505 70,102 53,098 227,705 Other segment items (3) 50,744 35,783 20,897 107,424 Segment operating earnings $ 58,462 $ 23,393 $ 25,930 $ 107,785 (1) Net sales relate to external customers only. All intersegment sales are eliminated in consolidation. (2) Product costs include the costs of raw materials and are recorded in Cost of goods sold in the Company’s Condensed Consolidated Statements of Operations. (3) Other segment items include overhead costs of operating the Company’s production facilities and providing chemical management services to customers and direct SG&A costs. The following table presents a reconciliation of the Company’s segment operating earnings to income before taxes and equity in net income of associated companies in the Company’s Condensed Consolidated Statements of Operations for the three months ended March 31, 2026 and 2025: Three Months Ended March 31, 2026 2025 Segment operating earnings $ 113,784 $ 107,785 Restructuring and related charges, net ( 7,381 ) ( 14,590 ) Non-operating and administrative expenses ( 55,087 ) ( 50,717 ) Depreciation of corporate assets and amortization ( 17,727 ) ( 14,854 ) Operating income 33,589 27,624 Other expense, net ( 23 ) ( 709 ) Interest expense ( 9,879 ) ( 9,545 ) Income before taxes and equity in net income of associated companies $ 23,687 $ 17,370 The following table presents information regarding the Company’s reportable segments’ depreciation for the three months ended March 31, 2026 and 2025: Three Months Ended March 31, Depreciation 2026 2025 Americas $ 3,466 $ 2,655 EMEA 2,408 1,877 Asia/Pacific 2,039 1,213 Total segment depreciation $ 7,913 $ 5,745 12 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Note 5 – Net Sales and Revenue Recognition Customer Concentration A significant portion of the Company’s revenues are realized from the sale of process fluids and services to manufacturers of steel, aluminum, automotive, aerospace, industrial and agricultural equipment, and durable goods. As previously disclosed in the Company’s 2025 Form 10-K, the Company’s five largest customers combined (each composed of multiple subsidiaries or divisions with semiautonomous purchasing authority) accounted for approximately 11 % of consolidated net sales for 2025, with its largest customer accounting for approximately 3 % of consolidated net sales. Contract Assets and Liabilities The Company had no material contract assets recorded on its Condensed Consolidated Balance Sheets as of March 31, 2026 or December 31, 2025. The Company had approximately $ 7.4 million and $ 3.6 million of deferred revenue as of March 31, 2026 and December 31, 2025, respectively. For the three months ended March 31, 2026, the Company satisfied materially all of the associated performance obligations and recognized into revenue materially all advance payments received and recorded as of December 31, 2025. Disaggregated Revenue The Company sells its industrial process fluids, specialty chemicals and technical expertise as a global product portfolio. The Company generally manages and evaluates its performance by reportable segment first, and then by customer industries. Net sales of each of the Company’s major product lines are generally spread throughout all three of the Company’s reportable segments, and in most cases, are approximately proportionate to the level of total sales in each reportable segment. The following tables disaggregate the Company’s net sales by segment and customer industry. Three Months Ended March 31, 2026 Customer Industries Americas EMEA Asia/Pacific Consolidated Total Metals $ 64,860 $ 35,926 $ 51,139 $ 151,925 Metalworking and other 148,868 106,157 73,529 328,554 $ 213,728 $ 142,083 $ 124,668 $ 480,479 Three Months Ended March 31, 2025 Customer Industries Americas EMEA Asia/Pacific Consolidated Total Metals $ 64,296 $ 32,960 $ 49,867 $ 147,123 Metalworking and other 149,415 96,318 50,058 295,791 $ 213,711 $ 129,278 $ 99,925 $ 442,914 Note 6 - Leases The Company has operating leases for certain facilities, vehicles, and machinery and equipment with remaining lease terms up to 9 years. Operating lease expense is recognized on a straight-line basis over the lease term. In addition, the Company has certain land use leases with remaining lease terms up to 89 years. The Company had no material variable lease costs, sublease income, or finance leases for the three months ended March 31, 2026 and 2025. The components of the Company’s lease expense are as follows: Three Months Ended March 31, 2026 2025 Operating lease expense $ 4,091 $ 3,708 Short-term lease expense 222 144 13 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Supplemental cash flow information related to the Company’s leases is as follows: Three Months Ended March 31, 2026 2025 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 4,047 $ 3,584 Non-cash lease liabilities activity: Leased assets obtained in exchange for new operating lease liabilities 4,078 3,877 Supplemental balance sheet information related to the Company’s leases is as follows: March 31, 2026 December 31, 2025 Right-of-use lease assets $ 38,534 $ 38,737 Other accrued liabilities 12,854 12,536 Long-term lease liabilities 22,134 22,759 Total operating lease liabilities $ 34,988 $ 35,295 Weighted average remaining lease term (years) 5.5 5.7 Weighted average discount rate 6.65 % 6.58 % Maturities of operating lease liabilities as of March 31, 2026 were as follows: For the remainder of 2026 $ 11,303 For the year ended December 31, 2027 10,462 For the year ended December 31, 2028 7,393 For the year ended December 31, 2029 4,373 For the year ended December 31, 2030 2,328 For the year ended December 31, 2031 and beyond 7,814 Total lease payments 43,673 Less: imputed interest ( 8,685 ) Present value of lease liabilities (1) $ 34,988 (1) During the year ended December 31, 2024, the Company entered into a new lease agreement for office and laboratory space in Radnor, Pennsylvania for the purpose of relocating its global headquarters. The lease for one portion of the laboratory space is expected to commence in the second quarter of 2026. The lease for the remaining portions of laboratory and office space is expected to commence upon the completion of the lessor owned leasehold improvements, which is expected to be in the fourth quarter of 2026 or the first quarter of 2027. The cumulative future lease commitment for the laboratory and office space is $ 79.7 million. The future lease commitments relating to this lease were not included in the lease liabilities balance as of March 31, 2026. 14 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Note 7 – Restructuring and Related Activities The Company records restructuring liabilities that represent nonrecurring charges in connection with simplifying certain organizational structures and operations. Restructuring costs incurred during the three months ended March 31, 2026 and 2025 include employee severance and asset-related and facility closure costs, including non-cash asset write-offs, which are recorded in Restructuring and related charges, net in the Company’s Condensed Consolidated Statements of Operations. Restructuring activity primarily consists of the following programs: 2026 Global Business Transformation Program In 2026, the Company initiated a global business transformation program (the “2026 program”), encompassing several strategic transformation and restructuring initiatives. The 2026 program primarily involves simplifying the organizational structure of legal entities, projects associated with information technology infrastructure initiatives, the optimization of specific product portfolios through targeted rationalization efforts, the optimization of certain supply chain activities and related workforce reductions. The 2026 program began in the first quarter of 2026 and is expected to be complete in 2028. Costs relating to employee termination benefits costs and asset related charges are expected to be recognized in Restructuring and related charges, net in the Company’s Condensed Consolidated Statements of Operations. Costs relating to other transformation initiatives described above are expected to be recognized within SG&A and Cost of goods sold in the Company’s Condensed Consolidated Statements of Operations. As of March 31, 2026, the 2026 program included approximately 20 headcount reductions globally. The Company recorded $ 4.4 million of restructuring and related charges relating to the program during the three months ended March 31, 2026. 2022 Global Cost and Optimization Program In 2022, the Company initiated a global cost and optimization program (the “2022 program”) to improve its cost structure and drive a more profitable and productive organization. As of March 31, 2026, the 2022 program included restructuring and associated severance costs to reduce headcount by approximately 440 positions globally. In addition, the Company took actions to optimize its facility footprint under this program. These actions are expected to be substantially complete by the end of 2026. The Company recorded $ 3.0 million and $ 14.6 million of restructuring and related charges relating to the 2022 program during the three months ended March 31, 2026 and 2025, respectively. Activity in the Company’s accrual for its ongoing restructuring plans and facility closure actions are as follows: 2022 Program 2026 Program Total Accrued restructuring as of December 31, 2025 $ 8,351 $ — $ 8,351 Severance costs 1,336 3,168 4,504 Asset-related and facility closure charges 1,663 1,214 2,877 Cash payments ( 2,913 ) ( 967 ) ( 3,880 ) Reductions against the reserve ( 1,017 ) ( 1,214 ) ( 2,231 ) Currency translation adjustments ( 139 ) — ( 139 ) Accrued restructuring as of March 31, 2026 $ 7,281 $ 2,201 $ 9,482 In connection with the plans for the closure of certain manufacturing and non-manufacturing facilities, the Company has made available for sale certain facilities and properties. As of March 31, 2026, the Company classified properties in the Americas segment with an aggregate book value of approximately $ 1.2 million as held-for-sale. These assets are recorded in Prepaid expenses and other current assets in the Company’s Condensed Consolidated Balance Sheets. The Company expects to complete the sale of these properties over the next 12 months. Note 8 – Share-Based Compensation The Company recognized $ 3.2 million of share-based compensation expense in its Condensed Consolidated Statements of Operations for each of the three months ended March 31, 2026 and 2025. Restricted Stock Awards During the quarter ended March 31, 2026, the remaining unrecognized compensation expense related to non-vested restricted shares was fully recognized. 15 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Restricted Stock Units During the three months ended March 31, 2026, the Company granted 74,235 restricted stock units under its LTIP , which are subject to time-based vesting, generally over one to three years . The fair value of these grants is based on the closing price of the Company’s common stock on the date of grant. As of March 31, 2026, unrecognized compensation expense related to non-vested restricted stock units was $ 13.4 million, to be recognized over a weighted average remaining period of 1.7 years. Performance Stock Units As a component of its LTIP, the Company grants performance-based stock unit awards (“PSUs”). The number of shares that may ultimately be issued as settlement for each award may range from 0 % up to 200 % of the target award, subject to the achievement of the Company’s market-based total shareholder return (“TSR”) metric relative to the performance of a selected peer group, and separately the achievement of a performance-based return on invested capital (“ROIC”) measure. The service vesting period required for the PSUs is generally three years and the measurement period of the market-based and performance-based objectives is generally from January 1 of the year of grant through December 31 of the year prior to issuance of the shares. As mentioned above, a portion of the Company’s PSUs are subject to the achievement of the Company’s TSR relative to the performance of a selected peer group. For PSUs subject to relative TSR performance granted in 2026, the Company’s peer group was the S&P Composite 1500 Chemicals index. Compensation expense for PSUs is measured based on the grant date fair value and is recognized on a straight-line vesting method basis over the applicable vesting period. During the three months ended March 31, 2026, the Company granted 28,842 PSUs with a ROIC condition. The fair value of these grants is based on the closing trading price of the Company’s common stock on the date of grant. During the three months ended March 31, 2026, the Company granted 28,733 PSUs with a relative TSR condition. These PSUs are valued using a Monte Carlo simulation on the grant date and had a grant-date fair value of $ 109.28 per unit, which was developed based on the assumptions set forth in the table below: 2026 Grants Risk-free interest rate 3.70 % Dividend yield 1.72 % Expected term (years) 3.0 As of March 31, 2026, there was approximately $ 10.9 million of total unrecognized compensation cost related to PSUs, which the Company expects to recognize over a weighted-average period of 2.5 years. Note 9 – Pension and Other Postretirement Benefits The components of net periodic benefit cost (income) are as follows: Three Months Ended March 31, Pension Benefits Other Postretirement Benefits 2026 2025 2026 2025 Service cost $ 104 $ 102 $ — $ — Interest cost 2,246 2,284 13 14 Expected return on plan assets ( 2,165 ) ( 1,984 ) — — Actuarial loss (gain) amortization 170 140 ( 20 ) ( 26 ) Prior service cost amortization 7 6 — — Net periodic benefit cost (income) $ 362 $ 548 $ ( 7 ) $ ( 12 ) Employer Contributions During the three months ended March 31, 2026, $ 0.8 million of contributions have been made to the Company’s U.S. and foreign pension plans. Contributions to other postretirement benefit plans were less than $ 0.1 million. Taking into consideration current minimum cash contribution requirements, the Company currently expects to make full year cash contributions of approximately $ 4.9 million to its U.S. and foreign pension plans and approximately $ 0.2 million to its other postretirement benefit plans. 16 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Note 10 – Other Expense, net The components of Other expense, net are as follows: Three Months Ended March 31, 2026 2025 Non-income tax refunds and other related credits $ 11 $ 168 (Loss) gain on disposals of property, plant, equipment and other assets, net ( 10 ) 2,148 Foreign exchange losses, net ( 670 ) ( 3,518 ) Pension and postretirement benefit costs, non-service components ( 251 ) ( 434 ) Interest income 623 660 Other non-operating income, net 274 267 Total other expense, net $ ( 23 ) $ ( 709 ) (Loss) gain on disposals of property, plant, equipment and other assets, net, includes the gain of $ 2.2 million recognized for the sale of certain property previously classified as held for sale during the three months ended March 31, 2025. Foreign exchange losses, net during the three months ended March 31, 2025 includes a $ 1.9 million foreign exchange loss relating to the change in fair value of the foreign exchange forward contracts entered into in connection with the acquisition of Dipsol. See Note 17, Hedging Activities , for more information. Note 11 – Income Taxes The Company’s effective tax rates for the three months ended March 31, 2026 and 2025 were 30.2 % and 43.4 %, respectively. The Company’s effective tax rate for the three months ended March 31, 2026 was largely driven by our mix of pre-tax earnings and withholding taxes. Comparatively, the effective tax rate for the three months ended March 31, 2025 was largely driven by our mix of pre-tax earnings, withholding taxes and return to provision adjustments offset by net favorable reductions in uncertain tax positions. On July 4, 2025, H.R. 1, commonly known as the One Big Beautiful Bill Act (the “OBBB”), was signed into law. The OBBB includes significant changes to the federal corporate tax provisions and extends certain otherwise expiring provisions of the 2017 Tax Cuts and Jobs Act. Among other things, the legislation restores 100% bonus depreciation for eligible property, reinstates expensing for domestic research and experimental expenditures, imposes new limitations on interest expense deductibility, and expands disallowed deductions for certain employee remuneration. The legislation has multiple effective dates, with certain provisions effective in 2025 and other provisions implemented in 2026 and 2027 forward. The provisions effective in 2025 did not have a material impact to our consolidated financial statements, and the provisions effective in 2026 and 2027 are not expected to have a material impact to our consolidated financial statements. 17 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Note 12 – Earnings Per Share The following table summarizes earnings per share calculations: Three Months Ended March 31, 2026 2025 Basic earnings per common share Net income attributable to Quaker Chemical Corporation $ 19,669 $ 12,922 Less: income allocated to participating securities ( 10 ) ( 22 ) Net income available to common shareholders $ 19,659 $ 12,900 Basic weighted average common shares outstanding 17,326,847 17,639,764 Basic earnings per common share $ 1.13 $ 0.73 Diluted earnings per common share Net income attributable to Quaker Chemical Corporation $ 19,669 $ 12,922 Less: income allocated to participating securities ( 10 ) ( 22 ) Net income available to common shareholders $ 19,659 $ 12,900 Basic weighted average common shares outstanding 17,326,847 17,639,764 Effect of dilutive securities 84,247 30,201 Diluted weighted average common shares outstanding 17,411,094 17,669,965 Diluted earnings per common share $ 1.13 $ 0.73 Certain stock options, restricted stock units, and PSUs are not included in the diluted earnings per share calculation when the effect would be anti-dilutive. The number of anti-dilutive shares were 61,990 and 70,771 , respectively, for the three months ended March 31, 2026 and 2025 . Note 13 – Goodwill and Other Intangible Assets Changes in the carrying amount of goodwill for the three months ended March 31, 2026 were as follows: Americas EMEA Asia/Pacific Total Balance as of December 31, 2025 $ 287,028 $ — $ 214,692 $ 501,720 Currency translation adjustments 113 — 172 285 Balance as of March 31, 2026 $ 287,141 $ — $ 214,864 $ 502,005 Mar 31, 2026 Dec 31, 2025 Goodwill, gross $ 691,788 $ 694,311 Accumulated impairment losses (1) ( 189,783 ) ( 192,591 ) Goodwill, net $ 502,005 $ 501,720 (1) Accumulated impairment losses are attributable to the non-cash impairment charges of $ 88.8 million and $ 93.0 million to write down the carrying value of the EMEA reporting unit during the second quarter of 2025 and the fourth quarter of 2022, respectively. These amounts include the impact of currency translation. 18 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Gross carrying amounts and accumulated amortization for definite-lived intangible assets were as follows: Gross Carrying Amount Accumulated Amortization Net Book Value March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025 Customer lists and rights to sell $ 895,970 $ 901,662 $ 363,102 $ 351,859 $ 532,868 $ 549,803 Trademarks, formulations and product technology 195,627 199,434 79,456 77,521 116,171 121,913 Other 6,864 6,871 6,245 6,236 619 635 Total definite-lived intangible assets $ 1,098,461 $ 1,107,967 $ 448,803 $ 435,616 $ 649,658 $ 672,351 The Company amortizes definite-lived intangible assets on a straight-line basis over their useful lives. The Company recorded amortization expense as follows: Three Months Ended March 31, 2026 2025 Amortization expense $ 16,128 $ 14,237 Estimated annual aggregate amortization expense for the current year and subsequent five years is as follows: For the remainder of 2026 $ 47,098 For the year ended December 31, 2027 62,869 For the year ended December 31, 2028 62,400 For the year ended December 31, 2029 61,282 For the year ended December 31, 2030 59,969 For the year ended December 31, 2031 58,688 As of March 31, 2026 and December 31, 2025, the Company had indefinite-lived intangible assets for trademarks and tradenames totaling $ 198.3 million and $ 201.2 million, respectively. Note 14 – Debt The following table sets forth the components of the Company’s debt: As of March 31, 2026 As of December 31, 2025 Interest Rate Outstanding Balance Interest Rate Outstanding Balance Credit Facilities: Revolver 4.85 % $ 242,858 4.95 % $ 229,088 U.S. Term Loan 5.02 % 475,464 5.10 % 482,144 Euro Term Loan 3.25 % 143,446 3.13 % 148,477 Industrial development bonds 5.26 % 10,000 5.26 % 10,000 Bank lines of credit and other debt obligations Various 3,205 Various 1,501 Total debt $ 874,973 $ 871,210 Less: debt issuance costs ( 540 ) ( 652 ) Less: short-term and current portion of long-term debts ( 37,301 ) ( 35,657 ) Total long-term debt $ 837,132 $ 834,901 19 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Credit facilities In June 2022, the Company, and its wholly owned subsidiary, Quaker Houghton B.V., as borrowers, Bank of America, N.A., as administrative agent, U.S. dollar swing line lender and letter of credit issuer, Bank of America Europe Designated Active Company, as Euro Swing Line Lender, certain guarantors and other lenders entered into an amendment to its primary credit facility. The amended credit facility (the “Credit Facility”) established (A) a $ 150.0 million Euro equivalent senior secured term loan (the “Euro Term Loan”), (B) a $ 600.0 million senior secured term loan (the “U.S. Term Loan”), and (C) a $ 500.0 million senior secured revolving credit facility (the “Revolver”), each maturing in June 2027. The Company has the right to increase the amount of the Credit Facility by an aggregate amount not to exceed the greater of $ 300.0 million or 100 % of Consolidated EBITDA, subject to certain conditions including the agreement to provide financing by any lender providing such increase. Subsequent to the first quarter of 2026, in April 2026, the Company, and its wholly owned subsidiary, Quaker Houghton B.V., as borrowers, Bank of America, N.A., as administrative agent, U.S. dollar swing line lender and letter of credit issuer, Bank of America Europe Designated Active Company, as Euro Swing Line Lender, certain guarantors and other lenders entered into the fourth amendment to its primary credit facility, entered into in August 2019. The amended credit facility (the “Amended Credit Facility”) established (A) a $ 250.0 million Euro equivalent senior secured term loan (B) a $ 550.0 million senior secured term loan and (C) a $ 800.0 million senior secured revolving credit facility, each maturing in April 2031. The Company primarily used the proceeds from the Amended Credit Facility to repay in full all outstanding loans under the existing Credit Facility and to terminate the revolving credit commitments under the existing Credit Facility. The Company has the right to increase the amount of the Amended Credit Facility by an aggregate amount not to exceed (a) the greater of (i) $ 331.0 million and (ii) 100 % of Consolidated EBITDA, subject to certain conditions including the agreement to provide financing by any lender providing such increase. As of March 31, 2026, the Company was in compliance with all of the Credit Facility covenants. See Note 19, Debt, to Consolidated Financial Statements in the Company’s 2025 Form 10-K. The weighted average variable interest rate incurred on the outstanding borrowings under the Credit Facility during the three months ended March 31, 2026 was approximately 4.8 %. As of March 31, 2026, the weighted average variable interest rate on the outstanding borrowings under the Credit Facility was approximately 4.7 %. As part of the Credit Facility, in addition to paying interest on outstanding principal, the Company is also required to pay an annual commitment fee ranging from 0.150 % to 0.275 % related to unutilized commitments under the Revolver, depending on the Company’s consolidated net leverage ratio. As of March 31, 2026, the Company had unused capacity under the Revolver of approximately $ 255 million, which is net of bank letters of credit of approximately $ 2 million. In order to manage the Company’s exposure to variable interest rate risk associated with the Credit Facility, in the first quarter of 2023, the Company entered into $ 300.0 million notional amounts of three-year interest rate swaps to convert a portion of the Company’s variable rate borrowings to an average fixed rate of 3.64 % plus an applicable margin as provided in the Credit Facility based on the Company’s consolidated net leverage ratio. In March 2026, the Company’s interest rate swap contracts expired. In April 2026, the Company entered into $ 400.0 million notional amounts of four-year interest rate swaps, converting a portion of the Company’s variable rate borrowings into an average fixed rate of 3.58 % plus the applicable margin. See Note 17, Hedging Activities , for more information. The Company capitalized third-party and credit debt issuance costs attributed to the Euro Term Loan, U.S. Term Loan and Revolver during the second quarter of 2022. Capitalized costs attributed to the Euro Term Loan and U.S. Term Loan are recorded as a direct offset to Long-term debt on the Condensed Consolidated Balance Sheets. Capitalized costs attributed to the Revolver are recorded within Other assets on the Condensed Consolidated Balance Sheets. These capitalized costs are amortized into Interest expense over the five-year term of the Credit Facility. As of March 31, 2026 and December 31, 2025, the Company had $ 0.5 million and $ 0.7 million, respectively, of debt issuance costs recorded as a reduction of Long-term debt and $ 1.2 million and $ 1.4 million, respectively, of debt issuance costs recorded within Other assets. Industrial development bonds As of March 31, 2026 and December 31, 2025, the Company had fixed rate, industrial development authority bonds totaling $ 10.0 million in principal amount due in 2028. These bonds have similar covenants to the Credit Facility noted above. Bank lines of credit and other debt obligations The Company has certain unsecured bank lines of credit and discounting facilities in certain foreign subsidiaries, which are not collateralized. The Company’s other debt obligations primarily consist of certain domestic and foreign low interest rate or interest-free municipality-related loans, local credit facilities of certain foreign subsidiaries, and finance lease obligations. Total unused capacity under these arrangements as of March 31, 2026 was approximately $ 58 million. 20 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) In addition to the bank letters of credit described in the “Credit facilities” subsection above, the Company maintains certain financial and other guarantees as off-balance sheet arrangements. Collectively, the total bank letters of credit and guarantees outstanding as of March 31, 2026 were approximately $ 7 million. Interest expense The Company incurred the following debt related expenses included within Interest expense in the Condensed Consolidated Statements of Operations: Three Months Ended March 31, 2026 2025 Interest expense $ 9,526 $ 9,192 Amortization of debt issuance costs 353 353 Total $ 9,879 $ 9,545 Based on the variable interest rates associated with the Credit Facility, as of March 31, 2026 and as of December 31, 2025, the amounts at which the Company’s total debt were recorded are not materially different from their fair market value. Note 15 – Accumulated Other Comprehensive Income The following tables show the reclassifications from and resulting balances of accumulated other comprehensive income (“AOCI”): Currency Translation Adjustments (1) Defined Benefit Pension Plans Unrealized Gain (Loss) in Available-for- Sale Securities Derivative Instruments Total Balance as of December 31, 2025 $ ( 104,697 ) $ ( 11,234 ) $ 257 $ 13 $ ( 115,661 ) Other comprehensive (loss) income before Reclassifications ( 9,426 ) 381 ( 210 ) — ( 9,255 ) Amounts reclassified from AOCI — 157 — ( 13 ) 144 Related tax amounts ( 496 ) ( 135 ) 44 — ( 587 ) Balance as of March 31, 2026 $ ( 114,619 ) $ ( 10,831 ) $ 91 $ — $ ( 125,359 ) Balance as of December 31, 2024 $ ( 192,841 ) $ ( 10,313 ) $ 287 $ 1,248 $ ( 201,619 ) Other comprehensive income (loss) before Reclassifications 27,125 ( 472 ) ( 391 ) ( 769 ) 25,493 Amounts reclassified from AOCI — 121 7 — 128 Related tax amounts — 86 80 177 343 Balance as of March 31, 2025 $ ( 165,716 ) $ ( 10,578 ) $ ( 17 ) $ 656 $ ( 175,655 ) (1) Includes mark-to-market impacts associated with net investment hedges. See Note 17, Hedging Activities , for more information. 21 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Note 16 – Fair Value Measurements The Company values its company-owned life insurance policies at fair value. The Company owns an immaterial amount of company-owned life insurance policies as of March 31, 2026 and December 31, 2025. The Company values its long-term debt at fair value based on quoted market prices for the same or similar issues, or on current rates offered to the company for debt of the same remaining maturities and terms. Due to the infrequency of trades, these inputs are considered to be Level 2 inputs. Based on the variable interest rates associated with the Credit Facility, as of March 31, 2026 and December 31, 2025, the amounts at which the Company’s total debt were recorded are not materially different from their fair market value. See Note 17, Hedging Activities , for a description of the Company’s derivative instruments including the valuation techniques used to determine fair value and support for their classification within Level 2 of the fair value hierarchy Note 17 – Hedging Activities The Company’s ongoing business operations expose it to various risks, including fluctuating foreign exchange rates and interest rate risk. To manage these risks, the Company periodically enters into derivative financial instruments, such as foreign exchange forward contracts, interest rate swap agreements, and cross-currency swap agreements. The Company does not hold or enter into derivative financial instruments for trading or speculative purposes. Foreign Exchange Forward Contracts The Company uses foreign exchange forward contracts to economically hedge the impact of the variability in exchange rates on certain assets and/or liabilities denominated in foreign currencies. These forward contracts are marked-to-market at each reporting date. Changes in the fair value of the underlying instrument and settlements are recognized in earnings in Other expense, net. The fair value of the forward contract is determined from sources independent of the Company, including the financial institutions which are party to the derivative instruments. Open foreign exchange forward contracts as of March 31, 2026 were entered into as hedges of the Japanese yen and Mexican peso against the U.S. dollar and had the following notional U.S. dollar values (in millions) : Currency March 31, 2026 Mexican Peso $ 12,900 Japanese Yen 15,000 $ 27,900 In connection with the acquisition of Dipsol as described in Note 2, Business Acquisitions , in March 2025, the Company entered into multiple foreign exchange forward contracts with various financial institutions with an aggregate notional amount totaling $ 155.3 million to hedge the variability of exchange rate impacts between the U.S. dollar and Japanese yen. These foreign exchange forward contracts settled on April 1, 2025. The Company recognized a $ 1.9 million foreign currency loss during the three months ended March 31, 2026 in Other expense, net relating to the change in fair value of these instruments as of the settlement date. Open foreign exchange forward contracts as of March 31, 2026 had maturities occurring over a period of up to one month . Interest Rate Swaps In order to manage the Company’s exposure to variable interest rate risk associated with the Credit Facility, such as the Secured Overnight Financing Rate (“SOFR”), in the first quarter of 2023, the Company entered into $ 300.0 million notional amounts of three-year interest rate swaps to convert a portion of the Company’s variable-rate borrowings into a fixed-rate obligation. See Note 14, Debt , for additional information. These interest rate swaps are designated as cash flow hedges and, as such, the contracts are marked-to-market at each reporting date with any unrealized gains or losses included in AOCI to the extent effective and reclassified to interest expense in the period during which the hedged transactions affect earnings or it becomes probable that the forecasted transaction will not occur. During March 2026, the Company’s interest rate swap contracts expired. In April 2026, the Company entered into $ 400.0 million notional amount of four-year interest rate swaps, converting a portion of the Company’s variable rate borrowings into an average fixed rate of 3.58 % plus the applicable margin. These interest rate swaps are designated as cash flow hedges. 22 Table of Contents Quaker Chemical Corporation Notes to Condensed Consolidated Financial Statements - Continued (Unaudited; Dollars in thousands, except per share amounts, unless otherwise stated) Net Investment Hedges In June 2025, the Company entered into a fixed-for-fixed cross currency swap for a notional amount of $ 75.0 million to hedge the variability of exchange rate impacts between the U.S. dollar and the European euro. Under the terms of the cross-currency swap agreement, the Company notionally exchanged $ 75.0 million at an interest rate of 1.9 % for 65.8 million EUR at an interest rate of 0.0 %. The cross-currency swap is designated as a net investment hedge on a pre-tax basis and expires in June 2027. In April 2025, the Company entered into fixed-for-fixed cross currency swaps with an aggregate notional amount totaling $ 100.0 million to hedge the variability of exchange rate impacts between the U.S. dollar and Japanese yen. Under the terms of the cross-currency swap agreements, the Company notionally exchanged $ 100.0 million at a weighted average interest rate of 3.1 % for 14.3 billion JPY at a weighted average interest rate of 0.0 %. The cross-currency swaps are designated as net investment hedges on an after-tax basis and expire in April 2028. The fixed-for-fixed cross-currency swaps are marked to market at each reporting date and any unrealized gains or losses are included in unrealized currency translation adjustments, within AOCI. The Company uses the spot method to evaluate the effectiveness of the net investment hedges. The balance sheet classification and fair values of the Company’s derivative instruments, which are Level 2 measurements, are as follows: Derivative instruments Condensed Consolidated Balance Sheets Location March 31, 2026 December 31, 2025 Net investment hedges Other non-current assets $ 10,950 $ 10,053 Net investment hedges Other non-current liabilities 285 1,541 Interest rate swaps Prepaid expenses and other current assets — 16 Foreign currency forward contracts Other accrued liabilities 77 5 The following table presents the net unrealized gain deferred to AOCI: Derivative instruments: Condensed Consolidated Balance Sheets Location March 31, 2026 December 31, 2025 Net investment hedges AOCI $ 8,213 $ 6,554 Interest rate swaps AOCI — 13 The following table presents the location and the amount of net gain (loss) recognized in the Company’s Condensed Consolidated Statements of Operations related to derivative instruments: Three Months Ended March 31, Derivative instruments Condensed Consolidated Statements of Operations 2026 2025 Net investment hedges Interest expense $ 1,124 $ — Interest rate swaps Interest expense 34 523 Foreign exchange forward contracts Other expense, net 393 ( 1,857 ) Total $ 1,551 $ ( 1,334 ) Note 18 – Commitments and Contingencies As previously disclosed in its 2025 Form 10-K, the Company is party to certain environmental matters and other litigation. See Note 25, Commitments and Contingencies , in the Company’s 2025 Form 10-K for more information. During the three months ended March 31, 2026, there have been no significant changes to the facts or circumstances of any of the previously disclosed matters. Although there can be no assurance regarding the outcome of any of the ongoing environmental matters or litigation, the Company believes that it has made adequate accruals for costs and liabilities associated with these matters. The Company has accrued approximately $ 5.2 million as of March 31, 2026 and December 31, 2025 for these ongoing matters. In addition, during the three months ended March 31, 2026, there are no new environmental matters or litigation that the Company believes will have a material adverse effect on the Company’s results of operations, cash flows, or financial condition. 23 Table of Contents Quaker Chemical Corporation Management’s Discussion and Analysis