What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-04-28 compared with 2025-11-03 · 101 added, 199 removed, 276 unchanged (52% of the section changed)

5 unchanged sentences

Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.

Net revenue for the three months ended September 30, 2025 was $932.0 million, a decrease of 5.2% on a reported basis compared to $982.8 million in the prior period.

Net revenue for the three months ended March 31, 2026 was $934.8 million, an increase of 2.6% on a reported basis compared to $911.3 million in the prior period.

Excluding an increase of 2.2% attributed to changes in foreign currency exchange rates and a decrease of 3.8% related to the effect of disposals, net revenue increased 4.2% on an organic basis.

2 unchanged sentences

Refer to Non-GAAP Financial Measures included elsewhere in this MD&A for additional information regarding our use of organic revenue growth (or decline).

Net revenue for the nine months ended September 30, 2025 was $2,786.6 million, a decrease of 7.9% compared to $3,025.1 million in the prior period.

Excluding an increase of 0.4% attributed to changes in foreign currency exchange rates and a decrease of 7.3% related to the effect of disposals, net revenue decreased 1.0% on an organic basis.

Operating loss for the three months ended September 30, 2025 was $122.9 million (13.2% of net revenue), an increase of $76.3 million, or 38.3% compared to an operating loss of $199.2 million (20.3% of net revenue) in the three months ended September 30, 2024.

Operating income for the nine months ended September 30, 2025 increased $61.9 million, or 81.9%, to $137.4 million (4.9% of net revenue) from $75.5 million (2.5% of net revenue) in the nine months ended September 30, 2024.

Refer to Results of Operations included elsewhere in this MD&A for additional discussion of our earnings results for the three and nine months ended September 30, 2025 compared to the prior periods.

Operating loss in the third quarter of 2025 includes approximately $259.0 million in charges as a result of changes in clean energy policy and emission regulations, including a non-cash goodwill impairment charge.

We determined that the Dynapower reporting unit was impaired and recorded a $225.7 million non-cash impairment charge.

Refer to Note 13:

Fair Value Measures of the Financial Statements, included elsewhere in this Report, for additional information.

We generated $420.0 million of operating cash flows in the nine months ended September 30, 2025, ending the quarter with $791.3 million in cash and cash equivalents.

In the nine months ended September 30, 2025, we used cash of approximately $81.6 million for capital expenditures, $52.9 million for payment of cash dividends, and $120.6 million for share repurchases as part of our share repurchase plan.

In September 2025, certain of our indirect, wholly-owned subsidiaries entered into an amendment (the “Fourteenth Amendment”) to the credit agreement, dated as of May 12, 2011 (as amended, supplemented, waived, or otherwise modified, the “Credit Agreement”).

Refer to Note 10:

Debt of the Financial Statements included elsewhere in this Report, for additional information regarding this transaction.

Operating income for the three months ended March 31, 2026 was $141.6 million (15.2% of net revenue), an increase of $19.5 million, or 15.9% compared to operating income of $122.2 million (13.4% of net revenue) in the three months ended March 31, 2025.

Refer to Results of Operations included elsewhere in this MD&A for additional discussion of our earnings results for the three months ended March 31, 2026 compared to the prior periods.

We generated $122.5 million of operating cash flows in the three months ended March 31, 2026, ending the quarter with $635.1 million in cash and cash equivalents.

In the three months ended March 31, 2026, we used cash of approximately $17.9 million for capital expenditures, $17.5 million for payment of dividends, and $25.1 million for share repurchases as part of our share repurchase plan.

Results of Operations

The table below presents our historical results of operations, in millions of dollars and as a percentage of net revenue, for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024.

The table below presents our historical results of operations, in millions of dollars and as a percentage of net revenue, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

We have derived the results of operations from the Financial Statements included elsewhere in this Report.

Amounts and percentages in the table below have been calculated based on unrounded numbers.

Amounts and percentages in the table below have

been calculated based on unrounded numbers.

Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.

For the three months ended For the nine months ended

September 30, 2025 September 30, 2024 September 30, 2025 September 30, 2024

Amount Percent

For the three months ended

March 31, 2026 March 31, 2025

Amount Percent

Performance Sensing $ 656.9 70.5 % $ 659.7 67.1 % $ 1,959.6 70.3 % $ 2,096.9 69.3 %

Sensing Solutions 275.0 29.5 274.4 27.9 827.0 29.7 800.3 26.5

Other — — 48.8 5.0 — — 127.9 4.2

Automotive $ 524.8 56.1 % $ 528.9 58.0 %

Industrials 184.2 19.7 185.7 20.4

Aerospace, Defense, and Commercial Equipment 225.8 24.2 196.7 21.6

Net revenue 934.8 100.0 911.3 100.0

Operating costs and expenses 793.2 84.8 789.1 86.6

Operating (loss)/income (122.9) (13.2) (199.2) (20.3) 137.4 4.9 75.5 2.5

Operating income 141.6 15.2 122.2 13.4

Interest expense (34.1) (3.6) (38.0) (4.2)

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Other, net 4.1 0.4 2.1 0.2

(Loss)/income before taxes (148.4) (15.9) (244.6) (24.9) 48.0 1.7 (47.0) (1.6)

Provision for/(benefit from) income taxes 14.1 1.5 (219.6) (22.3) 79.9 2.9 (169.7) (5.6)

Net (loss)/income $ (162.5) (17.4) % $ (25.0) (2.5) % $ (31.9) (1.1) % $ 122.7 4.1 %

Net revenue for the three months ended September 30, 2025 decreased 5.2% compared to the prior period.

Net revenue increased 3.1% on an organic basis, which excludes an increase of 0.8% attributed to changes in foreign currency exchange rates and a decrease of 9.1% due primarily to the effects of the divestitures of the various assets and liabilities comprising our vehicle area networks and data collection business (collectively, the "Insights Business") in the third quarter of 2024 and the Magnetic Speed and Positioning Business ("MSP Business") in the first quarter of 2025.

Income before taxes 115.5 12.4 90.6 9.9

Provision for income taxes 28.4 3.0 20.7 2.3

Net income $ 87.1 9.3 % $ 69.9 7.7 %

Net revenue for the three months ended March 31, 2026 increased 2.6% compared to the prior period.

Net revenue increased 4.2% on an organic basis, which excludes an increase of 2.2% attributed to changes in foreign currency exchange rates and a decrease of 3.8% due primarily to the effects of the divestiture of the Magnetic Speed and Positioning Business ("MSP Business") in the first quarter of 2025.

Refer to Note 16:

Disposals of the Financial Statements, included elsewhere in this Report, for additional information on the sale of the Insights Business and the MSP Business.

Net revenue for the nine months ended September 30, 2025 decreased 7.9% compared to the prior period.

Net revenue decreased 1.0% on an organic basis, which excludes an increase of 0.4% attributed to changes in foreign currency exchange rates and a decrease of 7.3% due primarily to the effects of the divestitures of the Insights Business in the third quarter of 2024 and the MSP Business in the first quarter of 2025.

Performance Sensing

Performance Sensing net revenue for the three months ended September 30, 2025 decreased 0.4% on a reported basis, which includes the effects of the divestiture of the MSP Business in the first quarter of 2025, and increased 3.6% on an organic basis compared to the prior period, which was primarily due to outgrowing both our Automotive and HVOR end markets.

Performance Sensing net revenue for the nine months ended September 30, 2025 decreased 6.5% on a reported basis and 3.6% on an organic basis compared to the prior period, which was primarily due to lower HVOR production levels in North America and Europe.

Sensing Solutions

Sensing Solutions net revenue for the three months ended September 30, 2025 increased 0.2% on a reported basis and 2.5% on an organic basis compared to the prior period, which is primarily due to content growth in our HVAC and aerospace end markets.

Sensing Solutions net revenue for the nine months ended September 30, 2025 increased 3.3% on a reported basis and 5.6% on an organic basis compared to the prior period, which is primarily due to content growth in our HVAC and aerospace end markets.

Disposals of the Financial Statements, included elsewhere in this Report, for additional information on the sale of the MSP Business.

Automotive net revenue for the three months ended March 31, 2026 decreased 0.8% compared to the prior period.

Excluding an increase of 2.5% attributed to changes in foreign currency exchange and a decrease of 4.0% due to the effects of a divestiture, Automotive net revenue increased 0.7% on an organic basis compared to the prior period, which was primarily due to product mix in the markets we serve.

Industrials net revenue for the three months ended March 31, 2026 decreased 0.8% compared to the prior period.

Excluding an increase of 1.5% attributed to changes in foreign currency exchange and a decrease of 3.0% due to the effect of divestitures, Industrials net revenue grew 0.7% on an organic basis compared to the prior period, which primarily reflects content growth in our Industrials business segment.

Aerospace, Defense, and Commercial Equipment

Aerospace, Defense, and Commercial Equipment net revenue for the three months ended March 31, 2026 increased 14.8% compared to the prior period.

Excluding an increase of 1.8% attributed to changes in foreign currency exchange rates and a decline of 3.7% due to the effects of a divestiture, Aerospace, Defense, and Commercial Equipment net revenue grew 16.7% on

an organic basis due to growth in our commercial equipment and aerospace business.

Operating Costs and Expenses

Operating costs and expenses for the three and nine months ended September 30, 2025 and 2024 are presented, in millions of dollars and as a percentage of net revenue, in the following table.

Operating costs and expenses for the three months ended March 31, 2026 and 2025 are presented, in millions of dollars and as a percentage of net revenue, in the following table.

Amounts and percentages in the table below have been calculated based on unrounded numbers.

Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.

For the three months ended For the nine months ended

September 30, 2025 September 30, 2024 September 30, 2025 September 30, 2024

Amount Percent

For the three months ended

March 31, 2026 March 31, 2025

Amount Percent

5 unchanged sentences

Amortization of intangible assets 15.7 1.7 20.6 2.3

Goodwill impairment charge 225.7 24.2 150.1 15.3 225.7 8.1 150.1 5.0

Restructuring and other charges, net 3.7 0.4 7.0 0.8

1 unchanged sentence

Cost of revenue

For the three and nine months ended September 30, 2025, cost of revenue as a percentage of net revenue increased from the prior period, primarily due to (1) the net impacts of inflation on material and logistics costs and pricing recoveries from customers, (2) increases in charges for a slower than expected adoption of electric vehicles, which resulted in excess capacity and other charges, and (3) unfavorable product mix, partially offset by the favorable effect of changes in foreign currency exchange rates.

For the three months ended March 31, 2026, cost of revenue as a percentage of net revenue decreased from the prior period, primarily due to the favorable effects of the MSP divestiture in the first quarter of 2025 and organic revenue growth, partially offset by the net impacts of inflation on material and logistics costs and tariffs.

Research and development expense

For the three and nine months ended September 30, 2025, research and development expense decreased primarily as a result of the divestiture of the Insights Business in the third quarter of 2024 and restructuring actions impacting certain product lines.

For the three months ended March 31, 2026, research and development expense did not fluctuate materially from the prior period.

Selling, general and administrative expense

For the three months ended September 30, 2025, SG&A expense decreased from the prior period, primarily due to costs and charges related to the third quarter 2024 sale of the Insights Business (including $5.8 million of accelerated vesting of restricted securities granted to employees of the Insights Business).

Refer to Note 4:

Share-Based Payment Plans and Note 16:

Disposals of the Financial Statements, included elsewhere in this Report, for additional information on share-based compensation related to restricted securities and the sale of the Insights Business, respectively.

For the nine months ended September 30, 2025, SG&A expense did not fluctuate materially from the prior periods.

For the three months ended March 31, 2026, selling, general and administrative expense did not fluctuate materially from the prior period.

Amortization of intangible assets

For the three and nine months ended September 30, 2025, amortization of intangible assets decreased from the prior period, primarily due to (1) $9.6 million of accelerated amortization related to our decision to exit the Spear aerospace and defense business in the third quarter of 2024, (2) the divestiture of the Insights Business, resulting in approximately $6.6 million and $26.2 million, respectively, of lower amortization expense during fiscal year 2025, and (3) the effect of amortization of

intangible assets in accordance with their expected economic benefit, which generally results in acceleration of amortization expense in the early years of the life of an intangible asset.

Goodwill impairment charge

In the third quarter of 2025, we recorded a $225.7 million non-cash impairment charge for our Dynapower reporting unit within the Sensing Solutions segment.

The primary indicators of impairment were a lower outlook within certain markets that the reporting unit operates in following recent tax legislation being enacted, and a strategic shift to focus on other markets.

This revised outlook led to downward revisions of forecasted future cash flows.

In the third quarter of 2024, we recorded a $150.1 million non-cash impairment charge for our Dynapower reporting unit within the Sensing Solutions segment.

The primary indicator of impairment was revised projections of future cash flows that were lower than previous projections, including future cash flows that were delayed beyond management's initial expectations.

Refer to Note 13:

Fair Value Measures of the Financial Statements, included elsewhere in this Report, for additional information.

For the three months ended March 31, 2026, amortization of intangible assets decreased from the prior period, primarily due to the effect of amortization of intangible assets in accordance with their expected economic benefit, which generally results in acceleration of amortization expense in the early years of the life of an intangible asset.

Restructuring and other charges, net

In the three months ended September 30, 2025, restructuring and other charges, net decreased from the prior period, primarily due to (1) the loss on the sale of the Insights Business in the third quarter of 2024, and (2) charges related to our decision to exit the Spear aerospace and defense business in the third quarter of 2024, partially offset by charges related to the loss on the sale of the Magnetic Speed and Positioning business in the first quarter of 2025.

In the nine months ended September 30, 2024, restructuring and other charges, net decreased from the prior year period, primarily due to (1) the loss on the sale of the Insights Business in the third quarter of 2024, and 2) charges related to our decision to exit the Spear aerospace and defense business in the third quarter of 2024, partially offset by (1) the loss on the sale of the Magnetic Speed and Positioning business in the first quarter of 2025, and (2) charges associated with the 2H 2024 Plan.

In the three months ended March 31, 2026, restructuring and other charges, net decreased from the prior period, primarily due to higher transaction-related charges in 2025 corresponding to the business divestitures that took place in that year, partially offset by higher charges related to the Transformation Plan in the current period.

Refer to Note 5:

Restructuring and Other Charges, Net and Note 16:

Disposals of the Financial Statements, included elsewhere in this Report, for additional information regarding the components of restructuring and other charges, net.

Operating (Loss)/Income

For the three months ended September 30, 2025, operating loss was $122.9 million, compared to the operating loss of $199.2 million in the prior period.

This favorable impact was driven primarily by (1) a decrease in product line and product lifecycle management charges, (2) a $25.1 million decrease in amortization of intangibles, and (3) cost savings as a result of actions taken as part of our restructuring plans, partially offset by a larger goodwill impairment charge taken in the current year than the prior year.

For the nine months ended September 30, 2025, operating income was $137.4 million, compared to $75.5 million in the prior period.

This favorable impact was driven primarily by (1) a decrease in product line and product lifecycle management charges, (2) a decrease in amortization of intangibles, and (3) cost savings as a result of actions taken as part of our restructuring plans, partially offset by a larger goodwill impairment charge taken in the current year than the prior year.

Restructuring and Other Charges, Net, included elsewhere in this Report, for additional information regarding the components of restructuring and other charges, net.

Operating Income

For the three months ended March 31, 2026, operating income was $141.6 million, compared to operating income of $122.2 million in the prior period.

This favorable impact was driven primarily by (1) higher revenue in the current period, (2) a decrease in amortization of intangibles, and (3) cost savings as a result of actions taken as part of our restructuring plans, partially offset by the net impacts of inflation on material and logistics costs.

Interest Expense

For the three and nine months ended September 30, 2025, interest expense did not fluctuate materially from the prior periods.

For the three months ended March 31, 2026, interest expense did not fluctuate materially from the prior period.

Interest Income

For the three and nine months ended September 30, 2025, interest income did not fluctuate materially from the prior periods.

Other, net primarily includes currency remeasurement gains and losses on net monetary assets, gains and losses on foreign currency and commodity forward contracts not designated as hedging instruments, mark-to-market gains and losses on investments, losses related to debt refinancing, and the portion of our net periodic benefit cost excluding service cost.

For the three months ended September 30, 2025, other, net represented a net gain of $6.9 million, a favorable impact on

earnings of $19.2 million compared to a net loss of $12.3 million in the prior period.

This favorable impact was primarily due to the absence of the loss on the redemption of the 5.0% senior notes due 2025 (the "5.0% Senior Notes") recognized in 2024 and

a larger gain on commodity forward contracts in the current period.

For the nine months ended September 30, 2025, other, net represented a net gain of $9.9 million, a favorable impact on earnings of $29.7 million compared to a net loss of $19.7 million in the prior period.

This favorable impact was primarily due to the absence of a $14.8 million loss recognized in the first quarter of 2024 as a result of observable price changes related to an equity investment held using the measurement alternative, the absence of the loss on the redemption of the 5.0% Senior Notes in the prior year, and a larger gain on commodity forward contracts in the current period.

For the three months ended March 31, 2026, interest income did not fluctuate materially from the prior period.

Other, net primarily includes gains and losses related to currency remeasurement adjustments, foreign currency and commodity forward contracts not designated as hedging instruments, mark-to-market investments, debt refinancing, and the portion of our net periodic benefit cost excluding service cost.

For the three months ended March 31, 2026, other, net represented a net gain of $4.1 million, a favorable impact on

earnings of $2.0 million compared to a net gain of $2.1 million in the prior period.

This favorable impact was primarily due to the absence of losses on forward currency forward contracts in the current year.

Refer to Note 13:

1 unchanged sentence

Other, Net of the Financial Statements, included elsewhere in this Report, for additional details of our hedge accounting contracts and the components of other, net, respectively.

Provision for/(benefit from) Income Taxes

The provision for/(benefit from) income taxes consists of (1) current tax expense, which relates primarily to our profitable operations in tax jurisdictions with limited or no net operating loss carryforwards and withholding taxes related to management fees, royalties, and the repatriation of foreign earnings;

Provision for Income Taxes

The provision for income taxes consists of (1) current tax expense, which relates primarily to our profitable operations in tax jurisdictions with limited or no net operating loss carryforwards and withholding taxes related to management fees, royalties, and the repatriation of foreign earnings;

and (2) deferred tax expense (or benefit), which represents adjustments in book-to-tax basis differences primarily related to (a) book versus tax basis in intangible assets, (b) changes in net operating loss carryforwards and tax credits, and (c) changes in withholding taxes on unremitted earnings.

During the third quarter of both 2025 and 2024 our provision for income taxes was unfavorably impacted by the impairment of nondeductible goodwill.

During the third quarter of 2024, our benefit from income taxes included a deferred tax benefit of approximately $257.7 million due to a tax strategy to secure the future tax deductibility of certain intellectual property which had a valuation allowance against it at December 31, 2023, offset by a $12.8 million tax expense on the sale of the Insights Business and a $11.1 million tax expense on the settlement of the U.S.

qualified pension plan.

Non-GAAP Financial Measures

6 unchanged sentences

Organic revenue growth (or decline) is defined as the reported percentage change in net revenue calculated in accordance with U.S.

GAAP, excluding the period-over-period impact of foreign exchange rate differences as well as the net impact of material acquisitions and divestitures and product life-cycle management for the 12-month period following the respective transaction date(s).

GAAP, excluding the period-over-period impact of foreign exchange rate differences as well as the net impact of material acquisitions, divestitures, and product life-cycle management actions for the 12-month period following the respective transaction date(s).

We believe that organic revenue growth (or decline) provides investors with helpful information with respect to our operating performance, and we use organic revenue growth (or decline) to evaluate our ongoing operations as well as for internal planning and forecasting purposes.

29 unchanged sentences

Gross leverage ratio

Gross leverage ratio represents gross debt (total debt and finance lease obligations) divided by last twelve months ("LTM") adjusted EBITDA.

Gross leverage ratio represents gross debt (total debt and finance lease obligations less unamortized issue costs) divided by last twelve months ("LTM") adjusted EBITDA.

We believe that gross leverage ratio is a useful measure to management and investors in understanding trends in our overall financial condition.

Net leverage ratio

Net leverage ratio represents net debt (total debt, finance lease and other financing obligations less cash and cash equivalents) divided by LTM adjusted EBITDA.

Net leverage ratio represents net debt (gross debt less cash and cash equivalents) divided by LTM adjusted EBITDA.

We believe that the net leverage ratio is a useful measure to management and investors in understanding trends in our overall financial condition.

5 unchanged sentences

• Restructuring related and other :

includes net charges related to certain restructuring and other exit activities, other costs (or income) that we believe are either unique or unusual to the identified reporting period, and the impact of commodity forward contacts that we believe impact comparisons to prior period operating results.

includes net charges related to certain restructuring and other exit activities, other costs (or income) that we believe are either unique or unusual to the identified reporting period, and the impact of commodity forward contracts that we believe impact comparisons to prior period operating results.

Such costs include charges related to optimization of our manufacturing processes to increase productivity.

3 unchanged sentences

• Financing and other transaction costs :

includes costs incurred, such as legal, accounting, and other professional services, that are directly related to an acquisition, divestiture, or equity financing transaction, expenses related to compensation arrangements entered into concurrent with the closing of an acquisition, adjustments related to changes in the fair value of acquisition-related contingent consideration amounts, and historical adjustments to exclude step-up depreciation in our non-GAAP measures.

Beginning with the three months ended December 31, 2024, we discontinued the use of adjustments to exclude step-up depreciation in our non-GAAP measures.

Prior periods have not been recast.

• Amortization of intangible assets :

includes amortization of intangible assets.

Beginning with the three months ended December 31, 2024, we started adjusting operating income and net income to exclude the amortization of all our intangible assets.

Prior periods have not been recast.

represents amortization of intangible assets.

• Other, net:

includes expenses (or income) recorded within Other, net on our condensed consolidated statements of operations.

Beginning with the three months ended March 31, 2025, we started adjusting net income to exclude the impacts of these losses (or gains).

Prior periods have been recast.

includes non-operating expenses (or non-operating income) recorded within Other, net on our condensed consolidated statements of operations.

Refer to Note 6:

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The following tables present reconciliations of certain financial measures calculated in accordance with U.S.

GAAP to the related non-GAAP financial measures for the three months ended September 30, 2025 and 2024.

GAAP to the related non-GAAP financial measures for the three months ended March 31, 2026 and 2025.

Refer to the Non-GAAP Adjustments section above for additional information regarding these adjustments.

Amounts and percentages in the tables below have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding.

For the three months ended September 30, 2025

(Dollars in millions, except per share amounts) Operating (Loss)/Income Operating Margin Income Taxes Net (Loss)/Income Diluted EPS

For the three months ended March 31, 2026

(Dollars in millions, except per share amounts) Operating Income Operating Margin Income Taxes Net Income Diluted EPS

Reported (GAAP) $ 141.6 15.2 % $ 28.4 $ 87.1 $ 0.59

4 unchanged sentences

0.1 — — 0.1 —

Amortization of intangible assets (c)

Amortization of intangible assets

15.7 1.7 — 15.7 0.11

5 unchanged sentences

Adjusted (non-GAAP) $ 174.0 18.6 % $ 19.4 $ 125.5 $ 0.86

For the three months ended September 30, 2024

(Dollars in millions, except per share amounts) Operating (Loss)/Income Operating Margin Income Taxes Net (Loss)/Income Diluted EPS

Reported (GAAP) $ (199.2) (20.3) % $ (219.6) $ (25.0) $ (0.17)

Non-GAAP adjustments:

Restructuring related and other (a)

211.9 21.6 (1.2) 210.7 1.40

Financing and other transaction costs (b)

132.2 13.4 (0.5) 131.6 0.87

Amortization of intangible assets (c)

43.5 4.4 — 43.5 0.29

Amortization of debt issuance costs — — — 1.3 0.01

— — (0.7) 11.6 0.08

Deferred taxes and other tax related — — (239.2) (239.2) (1.59)

Total adjustments 387.6 39.4 (241.6) 159.6 1.06

Adjusted (non-GAAP) $ 188.4 19.2 % $ 22.1 $ 134.6 $ 0.89

The following tables present reconciliations of certain financial measures calculated in accordance with U.S.

GAAP to the related non-GAAP financial measures for the nine months ended September 30, 2025 and 2024.

For the nine months ended September 30, 2025

(Dollars in millions, except per share amounts) Operating Income Operating Margin Income Taxes Net (Loss)/Income Diluted EPS

Reported (GAAP) $ 137.4 4.9 % $ 79.9 $ (31.9) $ (0.22)

Non-GAAP adjustments:

Restructuring related and other (a)

302.5 10.9 (3.1) 299.4 2.04

Financing and other transaction costs (b)

24.0 0.9 0.1 24.1 0.16

Amortization of intangible assets (c)

61.4 2.2 — 61.4 0.42

Amortization of debt issuance costs — — — 3.5 0.02

— — 0.9 (9.1) (0.06)

Deferred taxes and other tax related — — 26.2 26.2 0.18

Total adjustments 387.9 13.9 24.0 405.5 2.76

Adjusted (non-GAAP) $ 525.2 18.8 % $ 55.9 $ 373.6 $ 2.54

For the nine months ended September 30, 2024

For the three months ended March 31, 2025

(Dollars in millions, except per share amounts) Operating Income Operating Margin Income Taxes Net Income Diluted EPS

5 unchanged sentences

5.4 0.6 — 5.4 0.04

Amortization of intangible assets (c)

Amortization of intangible assets

20.6 2.3 — 20.6 0.14

2 unchanged sentences

Deferred taxes and other tax related — — 2.2 2.2 0.02

— — (233.8) (233.8) (1.55)

Total adjustments 44.3 4.9 3.3 46.7 0.31

Adjusted (non-GAAP) $ 166.5 18.3 % $ 17.4 $ 116.6 $ 0.78

(a) The following table presents the components of our restructuring related and other non-GAAP adjustment to net income for the three and nine months ended September 30, 2025 and 2024 (amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

For the three months ended September 30, For the nine months ended September 30,

(a) The following table presents the components of our restructuring related and other non-GAAP adjustment to net income for the three months ended March 31, 2026 and 2025 (amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

For the three months ended March 31,

(In millions) 2026 2025

1 unchanged sentence

$ 13.9 $ 18.1

261.8 150.1 262.1 150.1

Income tax effect

(4.0) (1.2) (3.1) (2.4)

Total non-GAAP restructuring related and other

2 unchanged sentences

Primarily includes charges related to repositioning our business and corporate functions to more effectively respond to the challenges that face the business, including severance, contract termination costs, charges related to asset write-downs, and other various restructuring-related charges.

Relates primarily to $225.7 million and $150.1 million in non-cash goodwill impairment charges recognized in the third quarter of 2025 and 2024, respectively, related to the Dynapower reporting unit.

Also includes costs related to optimization of our manufacturing processes to increase productivity and rationalize our manufacturing footprint and supply chain workforce rationalization in response to changing customer demand and recent U.S.

Government policy changes.

(b) The following table presents the components of our financing and other transaction costs non-GAAP adjustment to net income for the three and nine months ended September 30, 2025 and 2024 (amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

For the three months ended September 30, For the nine months ended September 30,

(b) The following table presents the components of our financing and other transaction costs non-GAAP adjustment to net income for the three months ended March 31, 2026 and 2025 (amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

For the three months ended March 31,

(In millions) 2026 2025

Transaction loss (i)

$ 14.5 $ 121.4 $ 23.1 $ 124.1

Merger and acquisition compensation arrangements (ii)

0.5 10.5 0.9 14.6

Acquisition-related depreciation

Income tax effect

— (0.5) 0.1 (1.7)

Total financing and other transaction costs

__________________________

Primarily includes losses or gains related to the divestiture of a business, costs incurred, including for legal, accounting, and other professional services, that are directly related to an acquisition, divestiture, or other transaction.

In the nine months ended September 30, 2025, this line includes costs and losses associated with the disposition of the MSP Business.

In the three and nine months ended September 30, 2024, this line includes costs and losses associated with the sale of the Insights business.

In the three months ended March 31, 2025, this line includes costs and losses associated with the disposition of the MSP Business.

Refer to Note 16:

Disposals for further information on this transaction.

Primarily relates to earnout compensation arrangements entered into concurrent with the closing of an acquisition and compensation in connection with the closing of a transaction.

(c) In the three months ended December 31, 2024, we discontinued the use of adjustments to exclude step-up depreciation in our non-GAAP measures and we adjusted operating income and net income to exclude the amortization of all our intangible assets.

The three and nine months ended September 30, 2024 have not been recast.

If we had recast this non-GAAP measure for the three and nine months ended September 30, 2024, adjusted operating income and adjusted net income would have increased by an additional $1.2 million and $4.4 million, respectively.

Primarily relates to compensation arrangements entered into concurrent with the closing of an acquisition and compensation in connection with the closing of a transaction.

The following table provides a reconciliation of net cash provided by operating activities in accordance with U.S.

GAAP to free cash flow.

For the nine months ended September 30,

For the three months ended March 31,

(In millions) 2026 2025

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GAAP to adjusted corporate and other expenses.

For the three months ended September 30, For the nine months ended September 30,

For the three months ended March 31,

(In millions) 2026 2025

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Adjusted corporate and other expenses (non-GAAP) $ (62.7) $ (52.4)

The following table provides a reconciliation of net (loss)/income in accordance with U.S.

The following table provides a reconciliation of net income in accordance with U.S.

GAAP to adjusted EBITDA.

For the three months ended September 30, For the nine months ended September 30,

For the three months ended March 31,

(In millions) LTM 2026 2025

Net (loss)/income

$ 48.5 $ 87.1 $ 69.9

Interest expense, net 126.5 30.2 33.7

Provision for/(benefit from) income taxes 109.3 14.1 (219.6) 79.9 (169.7)

Provision for income taxes 99.7 28.4 20.7

Depreciation expense 169.3 34.0 41.0

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GAAP to gross and net debt balances and leverage ratios.

(Dollars in millions) September 30,

(Dollars in millions) March 31,

2026 December 31,

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Liquidity and Capital Resources

As of September 30, 2025 and December 31, 2024, we held cash and cash equivalents in the following regions (amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

(In millions) September 30,

As of March 31, 2026 and December 31, 2025, we held cash and cash equivalents in the following regions (amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

(In millions) March 31,

2026 December 31,

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Our cash and cash equivalents balances are held in the following significant currencies (amounts in the tables below have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

As of September 30, 2025

As of March 31, 2026

(In millions) United States Dollar ("USD")

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USD Equivalent $ 11.9 $ 4.3 $ 60.5 $ 13.0

The table below summarizes our primary sources and uses of cash for the nine months ended September 30, 2025 and 2024.

The table below summarizes our primary sources and uses of cash for the three months ended March 31, 2026 and 2025.

We have derived these summarized statements of cash flows from the Financial Statements included elsewhere in this Report.

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Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.

For the nine months ended

(In millions) September 30, 2025 September 30, 2024

For the three months ended

(In millions) March 31, 2026 March 31, 2025

Net cash provided by/(used in):

Operating activities:

Net (loss)/income adjusted for non-cash items

Net income adjusted for non-cash items

$ 156.6 $ 141.9

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Operating activities.

Net cash provided by operating activities for the nine months ended September 30, 2025 increased compared to the corresponding period of the prior year, primarily due to favorable changes in working capital, partially offset by lower cash provided by earnings.

Net cash provided by operating activities for the three months ended March 31, 2026 increased compared to the corresponding period of the prior year, primarily due to higher cash provided by earnings, partially offset by unfavorable changes in working capital.

Investing activities.

Net cash used in investing activities for the nine months ended September 30, 2025 was $44.4 million compared to cash provided of $15.2 million for the corresponding period of the prior year.

This change was primarily due to lower proceeds received from the sale of the MSP Business in 2025 compared to the proceeds received from the sale of the Insights Business in 2024 and lower capital expenditures in the current period.

Refer to Note 16:

Disposals for additional information.

For fiscal year 2025, we may spend up to $150.0 million on capital expenditures, which we expect to fund with cash on hand.

Net cash used in investing activities for the three months ended March 31, 2026 was $16.5 million compared to cash used of $6.9 million for the corresponding period of the prior year.

This change was primarily due to proceeds received for the sale of the MSP Business in the first quarter of 2025, partially offset by higher capital expenditures in the prior period.

For fiscal year 2026, we anticipate additions to PP&E and capitalized software of up to approximately $150.0 million, which we expect to fund with cash flows from operations.

Financing activities .

Net cash used in financing activities for the nine months ended September 30, 2025 was $181.0 million compared to cash used in financing activities of $400.3 million in the corresponding period of the prior year.

This change was primarily due to the early redemption of our $700.0 million 5.0% Senior Notes in the third quarter of 2024, the increase in the amount of cash paid to repurchase ordinary shares in the current period, and the payment of $79.4 million to repurchase the remaining equity interest in a joint venture in the prior year, and was partially offset by the issuance of the 6.625% senior notes due 2032 in the second quarter of 2024.

Refer to Note 12:

Shareholders' Equity for additional information.

Net cash used in financing activities for the three months ended March 31, 2026 was $44.7 million compared to cash used in financing activities of $119.1 million in the corresponding period of the prior year.

This change was primarily due to a higher amount of cash paid to repurchase ordinary shares in the prior year.

Indebtedness and Liquidity

As of September 30, 2025, we had $3.2 billion in gross indebtedness, which includes finance lease obligations and excludes debt discounts, premiums, and deferred financing costs.

As of March 31, 2026, we had $2.9 billion in gross indebtedness, which includes finance lease obligations and excludes debt discounts, premiums, and deferred financing costs.

Capital Resources

Senior Secured Credit Facilities

In September, we entered into the Fourteenth Amendment which (i) reduced the total amount of the Revolving Credit Facility commitments of the lenders from $750.0 million to $650.0 million, (ii) extended the maturity date of the Revolving Credit Facility to September 24, 2030, and (iii) modified certain of the operational and restrictive covenants and other terms and conditions of the Credit Agreement to provide us increased flexibility and permissions thereunder.

Sources of liquidity

Our sources of liquidity include cash on hand, cash flows from operations, and available capacity under the Revolving Credit Facility.

As of September 30, 2025, we had $645.8 million available under the Revolving Credit Facility, net of $4.2 million of obligations in respect of outstanding letters of credit issued thereunder.

As of March 31, 2026, we had $645.8 million available under the Revolving Credit Facility, net of $4.2 million of obligations in respect of outstanding letters of credit issued thereunder.

Outstanding letters of credit are issued primarily for the benefit of certain operating activities.

As of September 30, 2025, no amounts had been drawn against these outstanding letters of credit.

As of March 31, 2026, no amounts had been drawn against these outstanding letters of credit.

This Revolving Credit Facility includes an accordion feature under which maximum borrowings may be increased under certain circumstances.

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However, we cannot make assurances that our business will generate sufficient cash flows from operations or that future borrowings will be available to us in an amount sufficient to enable us to pay our indebtedness or to fund our other liquidity needs.

Further, our highly-leveraged nature may limit our ability to procure additional financing in the future.

Our ability to raise additional financing, and our borrowing costs, may be impacted by short- and long-term debt ratings assigned by independent rating agencies, which are based, in significant part, on our performance as measured by certain credit metrics such as interest coverage and leverage ratios.

As of October 21, 2025, Moody’s Investors Service’s corporate credit rating for STBV was Ba2 with a stable outlook, and Standard & Poor’s corporate credit rating for STBV was BB+ with a stable outlook.

Further, the amount of our debt may limit our ability to procure additional financing in the future.

metrics such as interest coverage and leverage ratios.

As of April 16, 2026, Moody’s Investors Service’s corporate credit rating for STBV was Ba2 with a stable outlook, and Standard & Poor’s corporate credit rating for STBV was BB+ with a stable outlook.

Any future downgrades to STBV's credit ratings may increase our future borrowing costs but will not reduce availability under the Credit Agreement.

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The Credit Agreement also requires mandatory prepayments of the outstanding borrowings under the Senior Secured Credit Facilities upon certain asset dispositions and casualty events, in each case subject to certain reinvestment rights, and upon the incurrence of certain indebtedness (excluding any permitted indebtedness).

These provisions were not triggered during the nine months ended September 30, 2025.

These provisions were not triggered during the three months ended March 31, 2026.

The Credit Agreement and the Senior Notes Indentures contain restrictions and covenants that limit the ability of our wholly-owned subsidiary, STBV, and certain of its subsidiaries to, among other things, incur subsequent indebtedness, sell assets, pay dividends, and make other restricted payments.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations—Capital Resources included in our 2025 Annual Report.

programs and will be evaluated periodically with respect to future potential funding of those programs.

As of September 30, 2025, we believe we were in compliance with all covenants and default provisions under our credit arrangements.

These restrictions and covenants, which are subject to important exceptions and qualifications set forth in the Credit Agreement and Senior Notes Indentures, were taken into consideration when we established our share repurchase programs and will be evaluated periodically with respect to future potential funding of those programs.

As of March 31, 2026, we believe we were in compliance with all covenants and default provisions under our credit arrangements.

Share repurchase programs

From time to time, our Board of Directors has authorized various share repurchase programs, which may be modified or terminated by our Board at any time.

We currently have authorization for the September 2023 Program, under which approximately $282.4 million remained available as of September 30, 2025.

In the nine months ended September 30, 2025, and 2024, we repurchased 4.2 million and 1.3 million ordinary shares under the September 2023 Program.

In the nine months ended September 30, 2025 and 2024, we paid aggregate cash dividends of $52.9 million and $54.3 million, respectively.

In October 2025, we announced that our Board of Directors approved a quarterly dividend of $0.12 per share, payable in November 2025 to shareholders of record as of November 12, 2025.

In October 2025, we announced the commencement of a cash tender offer for up to $350 million of the outstanding $1.0 billion aggregate principal amount of 4.0% Senior Notes due 2029, $450.0 million aggregate principal amount of 4.375% Senior Notes due 2030, and $500.0 million aggregate principal amount of 5.875% Senior Notes due 2030.

We currently have authorization for the September 2023 Program, under which approximately $257.3 million remained available as of March 31, 2026.

In the three months ended March 31, 2026, and 2025, we repurchased 0.7 million and 3.5 million ordinary shares under the September 2023 Program.

In the three months ended March 31, 2026 and 2025, we paid aggregate cash dividends of $17.5 million and $17.9 million, respectively.

In April 2026, we announced that our Board of Directors approved a quarterly dividend of $0.12 per share, payable in May 2026 to shareholders of record as of May 13, 2026.

Critical Accounting Policies and Estimates

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It also requires that we make estimates and assumptions about future events that affect the amounts reported in the consolidated financial statements and accompanying notes.

No material changes to our critical accounting policies and estimates, as previously disclosed, have occurred during the first nine months of 2025.

No material changes to our critical accounting policies and estimates, as previously disclosed, have occurred during the first three months of 2026.

Quantitative and Qualitative Disclosures About Market Risk.

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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