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Item 1A. Risk Factors

2026-05-29 compared with 2025-05-29 · 146 added, 149 removed, 275 unchanged (52% of the section changed)

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The effects of geopolitical instability may adversely affect us and create significant risks and uncertainties for our business, with the ultimate impact dependent on future developments, which are highly uncertain and unpredictable.

Ongoing geopolitical instability has negatively impacted, and could in the future negatively impact, the global and U.S.

Geopolitical instability has negatively impacted, and could in the future negatively impact, the global and U.S.

economies, including by causing supply chain disruptions, rising inflation, volatility in capital markets and foreign currency exchange rates, rising interest rates, reduced consumer and Customer demand, economic slowdowns and recessions and heightened cybersecurity risks.

The extent to which such geopolitical instability adversely affects our business, financial condition and results of operations, as well as our liquidity and capital profile, may depend on future developments that are highly uncertain and unpredictable.

If geopolitical instability materially affects us, it may also have the effect of heightening other risks related to our business.

The potential impacts of such geopolitical instability include supply chain and logistics disruptions, financial impacts including volatility in foreign exchange and interest rates, increased inflationary pressure on raw materials and energy, reduced consumer and Customer demand, economic slowdowns and recessions and other risks, including an elevated risk of cybersecurity threats and the potential for new or further sanctions, tariffs or changes to international trade policy.

For instance, the U.S.

and other countries have announced changes, and planned changes, to international trade policy, including increasing tariffs on imports, and potentially renegotiating or terminating existing trade agreements.

The extent to which such geopolitical instability, including changes to trade policy, adversely affects our business, financial condition and results of operations, as well as our liquidity and capital profile, may depend on future developments that are highly uncertain and unpredictable.

If geopolitical instability or evolving trade policy materially affects us, it may also have the effect of heightening other risks related to our business.

The potential impacts of geopolitical instability, which may result from the actions of state and non-state actors, include supply chain and logistics disruptions, financial impacts including volatility in foreign exchange and interest rates, increased inflationary pressure on raw materials and energy, reduced consumer and Customer demand, economic slowdowns and recessions and other risks, including an elevated risk of cybersecurity threats and the potential for new or further sanctions, tariffs or changes to international trade policy .

Furthermore, the U.S.

and other countries have announced and enacted changes, and planned changes, to international trade policy, including increasing tariffs on imports, and potentially renegotiating or terminating existing trade agreements.

The international trade environment is highly dynamic, and such changes, and retaliatory responses thereto, continue to evolve.

Tariffs, trade restrictions and other changes to international trade policies may result in increased production costs and product pricing, supply chain disruptions, limited access to end markets, lower profitability, increasing inability of consumers and Customers to pay, reduced consumer and Customer demand, economic slowdowns and recessions and uncertainty related to planning long-term investments and strategies, and may have other competitive effects, each of which could have a material adverse effect on our business.

We may also need to make material changes to our global production footprint and workforce, which could require significant capital expenditures and could result in asset impairments and other charges, including restructuring charges, any of which could be material.

Tariffs, trade restrictions and other changes to international trade policies may result in increased production costs and product pricing, supply chain disruptions, limited access to end markets, lower profitability, increasing inability of consumers and Customers to pay, reduced consumer and Customer demand, economic slowdowns and recessions and uncertainty related to planning long-term investments and strategies, and may have other competitive effects, including those exacerbated by competitors with different supply chain footprints, each of which could have a material adverse effect on our business.

In addition, the United States-Mexico-Canada Agreement (“USMCA”) requires a formal six-year joint evaluation of the agreement.

The first such review is expected to commence on July 1, 2026, the sixth anniversary of the agreement's entry into

has solicited feedback from the trading community regarding the operation of the USMCA, and the joint review could result in changes, including, for example, the processes by which goods qualify for preferential treatment, the tariffs applicable to products or other restrictions on the movement of goods within the region under the USMCA.

Changes to the USMCA could adversely affect our manufacturing operations and those of our suppliers in Canada and Mexico and impact our ability to manufacture and market products or source materials at competitive prices, which could have a material adverse effect on our financial condition and results of operations.

We cannot predict the ultimate scope, duration, or impact of current or future tariff measures, changes to existing trade agreements, such as the USMCA, or the imposition of other trade restrictions.

We may also need to make material changes to our global production footprint and workforce as a result of geopolitical developments or changes to trade policy, which could require significant capital expenditures and could result in asset impairments and other charges, including restructuring charges, any of which could be material.

The duration and scope of all such changes that have been and will ultimately be implemented are not known at this time, and as such, any resulting impacts on our business are uncertain.

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Bribery Act, and similar anti-bribery laws, which generally prohibit companies and their intermediaries from making improper payments to officials for the purpose of obtaining or retaining business.

We are also subject to limitations on trade with persons in sanctioned countries.

While our employees and agents are required to comply with these laws, we cannot assure you that our internal policies and procedures will always protect us from violations of these laws, despite our commitment to legal compliance and corporate ethics.

We are also subject to limitations on trade with sanctioned persons or persons in sanctioned countries and exchange controls.

While our employees and agents are required to comply with these laws and regulations, our internal policies and procedures may not protect us from violations of these laws, which violations could affect financial condition, results of operations, or cash flows .

Healthcare Policy and Reimbursement

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Various healthcare reform proposals have emerged and may in the future emerge at the federal and state level, and we are unable to predict which, if any, of those proposals will be enacted or the level of government funding of healthcare in any country in which we operate.

For example, in 2025, the United States passed the One Big Beautiful Bill Act (the “OBBBA”) which may reduce Medicaid funding, result in decreased Medicaid reimbursements and negatively impact Customers who purchase our products and services.

Product and Service Related Regulations and Claims

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Additionally, in some foreign countries with weaker intellectual property rights, it may be difficult to maintain and enforce patents and other proprietary rights or defend against claims of infringement.

We might be adversely impacted by tax legislation or challenges to our tax positions.

We are subject to the tax laws at the federal, state or provincial, and local government levels in the many jurisdictions in which we operate or sell products or services.

Tax laws might change in ways that adversely affect our tax positions, effective tax rate and cash flow.

The tax laws are extremely complex and subject to varying interpretations.

We are subject to tax examinations in various jurisdictions that might assess additional tax liabilities against us.

Our tax reporting positions might be challenged by relevant tax authorities, we might incur significant expense in our efforts to defend those challenges, and we might be unsuccessful in those efforts.

Developments in examinations and challenges might materially change our provision for taxes in the affected periods and might differ materially from our historical tax accruals.

Any of these risks might have a materially adverse impact on our business operations, our cash flows and our financial position or results of operations.

We may be adversely impacted by changes in tax laws or challenges to our tax positions, and our effective tax rate is uncertain and may vary from expectations, which could have a material impact on our results of operations and earnings per share.

We are subject to the tax laws at the federal, state or provincial, and local government levels in the many jurisdictions in which we operate or sell our products or services.

Tax laws may change in ways that adversely affect our tax positions, effective tax rate and cash flow.

These tax laws are extremely complex and subject to varying interpretations, and we are subject to tax examinations in various jurisdictions that may assess additional tax liabilities against us.

Our tax reporting positions may be challenged by relevant tax authorities, we may incur significant expense in our efforts to defend those challenges, and we may be unsuccessful in such efforts.

Developments in examinations and challenges may materially change our provision for taxes in the affected periods and may differ materially from our historical tax accruals.

Any of these risks may have a materially adverse impact on our business operations, our cash flows, our financial position or results of operations and our effective tax rate.

In addition, there can be no assurance that we will be able to maintain any particular worldwide effective corporate tax rate.

We cannot give any assurance as to what our effective tax rate will be in the future because of, among other things, uncertainty regarding the tax policies of the jurisdictions in which we and our affiliates operate and uncertainty of earnings across geographies.

Further, our effective tax rate may increase as a result of withholding taxes incurred in connection with cross-border cash movements to fund operations, investments, and shareholder returns.

These transfers may be subject to withholding taxes, and increases in such taxes or changes in applicable tax laws could place upward pressure on our effective tax rate.

Our actual effective tax rate may vary from our expectations, and such variance may be material.

Additionally, tax laws or their implementation and applicable tax authority practices in any particular jurisdiction could change in the future, possibly on a retroactive basis, and any such change could have a material adverse impact on us and our affiliates.

In addition, the GloBE rules, which have been or are expected to be implemented in most of the jurisdictions where we have operations, and the CAMT (both defined and discussed in more detail below) may adversely impact our effective corporate tax rate.

Current economic and political conditions make tax rules in any jurisdiction subject to significant change.

Tax Cuts and Jobs Act (the “TCJA”) was signed into law on December 22, 2017.

Guidance continues to be issued clarifying the application of this legislation and changes have been proposed, and in many instances finalized, with respect to a number of income tax provisions (including foreign tax credit regulations) in the U.S.

that could increase our total tax expense.

In addition, beginning January 1, 2022, the limitation on deductibility of interest expense, which generally limits a deduction for interest expense to 30% of taxable income (subject to certain adjustments), must be determined by reducing taxable income by depreciation and amortization deductions, which may limit our ability to deduct interest expense in the future.

We cannot predict the overall impact that the additional guidance and recent changes may have on our business.

In addition, due to the expiration of many provisions of the TCJA at the end of 2025, the U.S.

may experience a significant amount of changes to the tax rules impacting U.S.

corporations.

Such developments may further affect our income tax liability in the U.S.

and, as a consequence, our effective tax rate.

The One Big Beautiful Bill Act (the “OBBBA”) was signed into law on July 4, 2025.

Some limited guidance has been issued clarifying the application of some of the provisions in this legislation, and more guidance is expected to be issued in the near future with respect to a number of income tax provisions in the OBBBA.

The law did not have a material impact on our fiscal 2026 consolidated financial statements, and we do not expect it to have a material impact on our effective tax rate in future years.

However, we are unable to fully predict the overall impact that the OBBBA and additional guidance may have on our business.

Furthermore, some non-U.S.

jurisdictions have raised tax rates, and it is reasonable to expect that other global taxing authorities will be reviewing current legislation for potential modifications in reaction to the current provisions of the TCJA, potential future modifications or repeal of certain provisions of the TCJA, and other current economic conditions.

jurisdictions have raised tax rates, and it is reasonable to expect that other global taxing authorities will be reviewing current legislation for potential modifications.

In August 2022, the Inflation Reduction Act (the “IRA”) was signed into law.

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Internal Revenue Code of 1986, as amended (the “Code”), beginning for fiscal years 2023.

We do not expect to be subject to the CAMT regime for fiscal years through 2025.

However, if in the future we become subject to CAMT, then if our regular income tax liability in the U.S.

Although we do not expect to be subject to the CAMT regime for fiscal years through 2026, we continue to monitor our status under the CAMT rules.

If in the future we become subject to CAMT, and if our regular income tax

liability in the U.S.

is lower than the income tax liability calculated under the CAMT provisions, we will be subject to additional income taxes in the U.S.

In addition, further changes in the tax laws of other jurisdictions will likely arise, including as a result of the base erosion and profit shifting ("B EPS") project undertaken by the Organization for Economic Cooperation and Development ("OECD").

In addition, further changes in the tax laws of other jurisdictions will likely arise, including as a result of the base erosion and profit shifting ("BEPS") project undertaken by the Organization for Economic Cooperation and Development ("OECD").

The OECD, which represents a coalition of member countries, has issued recommendations that, in some cases, would make substantial changes to numerous long-standing tax positions and principles.

Following the issuance of such recommendation, in December 2022, the European Union issued a directive to adopt Global Base Erosion laws (a/k/a GloBE or Pillar Two) in the EU member countries, in most cases beginning in fiscal year 2024.

Following the issuance of such recommendation, in December 2022, the European Union issued a directive to adopt Global Base Erosion laws ("GloBE" or "Pillar Two") in the EU member countries, in most cases beginning in fiscal year 2024.

Most EU member countries and many non-EU member countries have already adopted local legislation based on GloBE Model Rules.

Some of the countries that have not yet adopted GloBE are expected to do so in the near future.

The GloBE rules could subject us to additional income taxes in the jurisdictions that adopted GloBE if our effective corporate tax rate in those jurisdictions (determined under the GloBE rules) is below 15%.

Accordingly, the GloBE rules could increase tax uncertainty and adversely impact our provision for income taxes.

In addition, the GloBE rules have certain transition period provisions that apply to certain intercompany transactions occurring between December 1, 2021 and the effective date of the GloBE rules in a given jurisdiction.

These transition period provisions may have an adverse impact on our effective tax rate, and subject us to additional income tax, in some of the jurisdictions who adopt the GloBE rules.

These transition period provisions may have an adverse impact on our effective tax rate, and subject us to additional income tax, in some of the jurisdictions that adopt the GloBE rules.

OECD continues to issue guidance under GloBE which could result in amendments and modifications of the local GloBE rules and further uncertainty of GloBE’s impact on our income tax expense.

Our effective tax rate is uncertain and may vary from expectations, which could have a material impact on our results of operations and earnings per share.

There can be no assurance that we will be able to maintain any particular worldwide effective corporate tax rate.

Our actual effective tax rate may vary from our expectations, and such variance may be material.

In addition, the GloBE rules, which have been or are expected to be implemented in most of the jurisdictions where we have operations, and the CAMT may adversely impact our effective corporate tax rate.

In the most recent guidance, issued in January of 2026, OECD modified, among other things, certain rules relating to the one-year extension of the transitional country-by-country reporting safe harbor and the addition of both a permanent simplified effective tax rate safe harbor and a substance-based tax incentive safe harbor.

This guidance also introduced a so-called “side-by-side” safe harbor pursuant to which multinational groups with an ultimate parent entity (or a "UPE") located in a qualifying jurisdiction are effectively exempt from certain GloBE taxes.

At this time, only the United States is included on the list of qualifying jurisdictions allowing U.S.-parented multinational companies to avoid such GloBE taxes.

While we have substantial presence in the U.S., we do not anticipate to benefit from the side-by-side safe harbor at this time, because we are a multinational enterprise with a UPE organized in Ireland.

As a result, the GloBE rules could subject us to additional income taxes in the jurisdictions that adopted GloBE if our effective corporate tax rate in those jurisdictions (determined under the GloBE rules) is below 15%.

Accordingly, the GloBE rules could increase tax uncertainty and adversely impact our provision for income taxes.

Changes in tax treaties and trade agreements could negatively impact our costs, results of operations and earnings per share.

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However, if proposals are adopted that have the effect of disregarding our organization in Ireland or limiting our ability as an Irish company to take advantage of tax treaties with the U.S., we could be subject to increased taxation and/or potentially significant expense.

Further, our organization under the laws of Ireland could be challenged by the IRS.

Should the IRS assert that we should be treated as a U.S.

corporation for U.S.

federal tax purposes, we could be subject to substantial additional U.S.

tax liability and non-U.S.

holders of our ordinary shares would be subject to U.S.

withholding tax on the gross amount of any dividends we paid to such shareholders.

For Irish tax purposes, we are expected, regardless of our U.S.

tax resident status, to be treated as an Irish tax resident.

Consequently, if we are treated as a U.S.

corporation for U.S.

federal tax purposes, we could be liable for both U.S.

and Ireland taxes, which could have a material adverse effect on our financial condition and results of operations.

On June 7, 2017, several countries, including many countries in which we operate and have subsidiaries, adopted the OECD’s Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the "MLI"), which generally is meant to prevent treaty abuse, improve dispute resolution, prevent the artificial avoidance of permanent establishment status and neutralize the effect of hybrid mismatch agreements.

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The number of affected tax treaties could eventually be significant.

To date, more than 100 jurisdictions have joined the BEPS MLI, out of which most jurisdictions have ratified, accepted, or approved the MLI, and it covers around 1,950 bilateral tax treaties worldwide.

To date, more than 100 jurisdictions have joined the BEPS MLI, out of which most jurisdictions have ratified, accepted, or approved the MLI, and it covers almost 2,000 bilateral tax treaties worldwide.

Signatories include jurisdictions from all continents and all levels of development and other jurisdictions are also actively working towards signature.

As a result, our income may be taxed in jurisdictions where it is not currently taxed and at higher rates than it is currently taxed, which may increase our effective tax rate.

As a result, our income may be taxed in jurisdictions where it is not currently taxed and at higher rates than it is currently taxed, all of which may increase our effective tax rate.

Existing free trade laws and regulations provide certain beneficial duties and tariffs for qualifying imports and exports, subject to compliance with the applicable classification and other requirements.

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We are unable to predict the likelihood that any such proposed legislation might become law, the nature of regulations that may be promulgated under any future legislative enactments, or the effect such enactments or increased regulatory scrutiny could have on our business.

Internal Revenue Service (the “IRS”) may not agree that we are a non-U.S.

corporation for U.S.

federal tax purposes.

Although we are organized under the laws of Ireland and are a tax resident in Ireland for Irish tax purposes, the IRS may assert that we should be treated as a U.S.

corporation (and, therefore, a U.S.

tax resident) for U.S.

federal tax purposes pursuant to Section 7874 of the Code (“Section 7874”).

federal tax purposes, a company generally is considered to be a tax resident in the jurisdiction of its organization.

Because we are organized under the laws of Ireland, we would generally be classified as a non-U.S.

corporation (and, therefore, a non-U.S.

tax resident) under these rules.

Section 7874, however, provides an exception to this general rule under which a non-U.S.

organized entity may be treated as a U.S.

corporation for U.S.

federal tax purposes.

The rules under Section 7874 are complex, but as a general matter, a foreign corporation is treated as a U.S.

corporation if the foreign corporation acquires stock in or assets of a U.S.

corporation (or a U.S.

partnership) whereas, by reason of such acquisition, the former shareholders of the U.S.

corporation (or the former partners of the U.S.

partnership) own at least 80% (by vote or value) of the stock in the foreign corporation.

If we were to be treated as a U.S.

corporation for U.S.

federal tax purposes, we could be subject to substantial additional U.S.

tax liability.

Additionally, if we were treated as a U.S.

corporation for U.S.

federal tax purposes, non-U.S.

holders of our ordinary shares would be subject to U.S.

withholding tax on the gross amount of any dividends we paid to such shareholders.

For Irish tax purposes, we are expected, regardless of any application of Section 7874, to be treated as an Irish tax resident.

Consequently, if we are treated as a U.S.

corporation for U.S.

federal tax purposes under Section 7874, we could be liable for both U.S.

and Ireland taxes, which could have a material adverse effect on our financial condition and results of operations.

BUSINESS AND OPERATIONAL RISKS

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Our businesses compete with other broad-line manufacturers, as well as many smaller businesses specializing in particular products or services, primarily on the basis of brand, design, quality, safety, ease of use, serviceability, price, product features, warranty, delivery, service, and technical support.

We face increased competition from new infection prevention, sterile processing, contamination control, surgical support, cleaning consumables,

gastrointestinal endoscopy accessories, contract sterilization, and other products and services entering the market.

We also continue to work with our suppliers to implement plans to improve our competitive position by reducing material costs and manufacturing inefficiencies and realize productivity gains and distribution and supply chain efficiencies.

Maintaining and improving our competitive position will require continued investment by us in manufacturing, engineering, quality standards, marketing, Customer service and support of our distribution networks.

We also face increased competition from new infection prevention, sterile processing, contamination control, surgical support, cleaning consumables, gastrointestinal endoscopy accessories, contract sterilization, and other products and services entering the market.

Competitors and potential competitors also are attempting to develop alternate technologies and sterilizing agents, as well as disposable medical instruments and other devices designed to address the risk of contamination.

In addition, we also face competition within our AST segment from our Customers who may insource their sterilization needs by utilizing their own technology and systems.

If we cannot successfully implement our strategies to compete, our revenues and results of operations may be negatively impacted, which could adversely affect our business, financial condition and results of operations or our long-term prospects.

Consolidations among our healthcare and pharmaceutical Customers may result in a loss of Customers or more significant pricing pressures .

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In addition, administrations in the U.S.

and other countries have recently announced plans to implement or increase tariffs, and it remains unclear what the ultimate outcome of these policy changes will be on our supply chains.

and other countries continue to announce plans to implement or increase tariffs and other trade barriers, and it remains unclear what the ultimate outcome of these policy changes will be on our supply chains.

Also, certain of our key materials and components have a limited number of suppliers, and some are single-sourced in certain regions of the world, such as cobalt-60 and EO, which are necessary for our AST operations.

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Many governments, regulators, investors, employees, Customers and other stakeholders continue to be focused on corporate responsibility, including policies regarding climate change and greenhouse gas emissions.

Other stakeholders, including governments and regulators, have expressed concerns about businesses' social commitments and sustainability goals.

Other stakeholders, including governments, regulators, and elected officials have expressed concerns about or opposition to businesses' social commitments, and sustainability goals, and other ESG-focused policies, including concerns about or allegations of "greenwashing".

Responding to these considerations involves risks and uncertainties, requires significant investments and is impacted by factors that may be outside our control.

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Stakeholders also may have very different views on where corporate focus should be placed, including differing or conflicting views of regulators or elected officials in the various jurisdictions in which we operate.

expectations and standards could result in advocacy group campaigns or legal and regulatory proceedings against us that could materially adversely affect our business, reputation, results of operations, financial condition and stock price.

For instance, the European Union has generally adopted more extensive sustainability reporting requirements and environmental regulations, while certain U.S.

federal and state authorities have adopted or proposed measures that may restrict or penalize companies for adopting certain ESG-related practices, targets or investment criteria.

Any failure, or perceived failure, by us to achieve our goals, further our initiatives, adhere to our public statements, comply with federal, state or international laws and regulations or meet evolving and varied stakeholder expectations and standards could result in reputational harm or advocacy group campaigns or legal and regulatory proceedings against us that could materially adversely affect our business, reputation, results of operations, financial condition and stock price.

Many of our Customers are also committing to, and may become subject to legal or regulatory requirements with respect to, long-term targets to reduce greenhouse gas emissions within their supply chains and associated emissions reporting.

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The effects could impair, for example, the availability and cost of energy (including utilities), and we may bear losses as a result.

The regulations surrounding greenhouse gas emissions disclosures and sustainability reporting have also continued to evolve, with compliance requirements varying by jurisdiction.

The regulations surrounding greenhouse gas emissions disclosures and sustainability reporting have also continued to evolve, with compliance and other requirements varying by jurisdiction, which subjects us to transition risks.

Governments, regulatory bodies and other stakeholders vary in their support of or opposition to sustainability and environmental matters in different jurisdictions in which we operate, which can lead to rapid shifts in reporting obligations and differing obligations across these jurisdictions.

Both the standard setting and regulatory landscapes are also extremely complex and present significant compliance and communication challenges in light of these uncertain and varied approaches to greenhouse gas emissions disclosures and sustainability reporting.

If our greenhouse gas emissions-related data, processes or reporting are incomplete or inaccurate, or if we fail to comply with relevant reporting frameworks from existing or newly emerging regulations, we may incur monetary penalties and reputational harm, investor demand for our securities could decrease, or we could become subject to litigation or governmental investigations, any of which may have a material adverse effect on our financial condition and results of operations.

For example, on January 5, 2023, the CSRD became effective.

The CSRD expands the number of companies required to publicly report ESG-related information, defines the ESG-related information that companies are required to disclose in accordance with ESRS and imposes additional assurance obligations with respect to such disclosures.

While CSRD rules are prescriptive for the types of data to be reported, the methodology for quantifying and qualifying such data are still developing and uncertain and may impose increased costs on us related to complying with our reporting obligations and increase risks of non-compliance with ESRS and the CSRD.

In addition, there is currently uncertainty surrounding the requirements to publish ESG-related information under the CSRD and the content requirements of such report under the ESRS.

On February 26, 2025, the European Commission proposed an “Omnibus” reform law that would delay application of the CSRD by two years (so-called “stop the clock”) and that proposes reducing the number of reporting requirements under the ESRS.

On April 17, 2025, the "stop the clock" delay became effective at the EU level, and EU member states have until December 31, 2025 to transpose the delay into national law.

However, the balance of the changes to the CSRD proposed as part of the Omnibus package need to progress through the European Union's legislative process and require political approval.

Responses from the European Union member countries have been varied, and there is uncertainty as to when and how the CSRD may be changed in light of these proposals;

however, Irish officials have expressed support for the proposed changes and further pledged to amend existing Irish legislation to clarify and reduce the scope of companies covered.

Both the standard setting and regulatory landscapes are also extremely complex and present

significant compliance and communication challenges in light of these uncertain and varied approaches to greenhouse gas emissions disclosures and sustainability reporting.

If our greenhouse gas emissions-related data, processes or reporting are incomplete or inaccurate, we fail to comply with relevant reporting frameworks or efficiency standards from existing or newly emerging regulations, or we become subject to expanded carbon pricing mechanisms, we may incur enhanced costs, monetary penalties and reputational harm, investor demand for our securities could decrease, or we could become subject to litigation or governmental investigations, any of which may have a material adverse effect on our financial condition and results of operations.

The introduction and evolution of climate- and sustainability-related laws, regulations and reporting requirements—many of which are not uniform across jurisdictions—can increase the complexity and cost of compliance and heighten our exposure to enforcement actions, litigation and reputational harm.

For example, the European Union adopted the CSRD in 2023, and in 2025 the European Commission proposed amendments to the CSRD aimed at simplifying sustainability reporting in Europe.

Such amendments entered into force in March 2026, with transposition into national law by EU member states required in 2027, while changes to the ESRS are expected to be finalized later in calendar year 2026.

While the EU has adopted extensive requirements through CSRD and ESRS, which continue to evolve, other jurisdictions, including, for example, the United Kingdom and California, have their own sustainability reporting frameworks.

Managing compliance across these inconsistent regimes is complex and costly, and may result in disclosures that emphasize different metrics, use different methodologies or reach different conclusions depending on the applicable frameworks.

We may also face challenges in presenting consistent and comparable sustainability information to global stakeholders.

These changes, and any other new or pending legal or regulatory matters, may result in the expenditure of additional resources or costs to comply with such requirements, which could affect our financial condition, results of operations or cash flows.

Our operations are subject to regulations and permitting, which may be changed or amended by the relevant authorities, and which may limit or eliminate our current operations or increase the complexity, burden, or expense of compliance, and regulated materials or processes that we use in our operations may become the focus of litigation.

Our AST segment is a technology-neutral contract sterilization service that offers our Customers a wide range of sterilization modalities through a worldwide network of over 60 contract sterilization and laboratory facilities.

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Our AST operations have taken and will continue to take measures to comply with all applicable emissions regulations and to reduce emissions.

However, no assurance can be given that current or future legislative

or regulatory action, or current or future litigation to which we are or may become a party, will not significantly affect the costs of conducting our EO contract sterilization operations or impact the use of EO in our contract sterilization operations.

However, no assurance can be given that current or future legislative or regulatory action, or current or future litigation to which we are or may become a party, will not significantly affect the costs of conducting our EO contract sterilization operations or impact the use of EO in our contract sterilization operations.

A significant reduction in our EO contract sterilization activities may have a material adverse effect on our financial condition and results of operations.

Further, we could be liable for material damages and fines as a result of legislative or regulatory action or litigation, and any liability could exceed our insurance and indemnification coverage, if any, and have a material adverse effect on our financial condition.

Further, we have settled claims of liability resulting from EO sterilization activities in the past and could in the future be liable for further material damages and fines as a result of legislative or regulatory action or litigation, and any current or future liability could exceed our insurance and indemnification coverage, if any, and have a material adverse effect on our financial condition.

Additionally, for many medical devices, EO sterilization may be the only current method of sterilization that effectively sterilizes and does not damage the device during the sterilization process.

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These developments, as well as other publicity related to EO litigation or regulatory activity, may increase the likelihood that we will continue to be subject to these claims or that we will be subject to more claims on behalf of similar plaintiffs in the future.

Although we believe we have valid defenses to such claims, there can be no assurance that we will prevail on the merits, as the outcome of trials before juries and other aspects of litigation can be highly unpredictable, and, as a result, we have chosen to pursue a settlement process with respect to pending cases in Illinois.

In March 2025, we agreed to pay up to approximately $48.2 million to resolve substantially all of the claims for personal injury against a subsidiary related to EO exposure that are pending in the Circuit Court of Cook County, Illinois.

Pursuant to binding confidential settlement agreements entered into in March and October 2025, we agreed to pay up to approximately $48.2 million to resolve substantially all of the claims for personal injury against a subsidiary related to EO exposure that are pending in the Circuit

Court of Cook County, Illinois.

A claims process regarding confidential settlement agreements is ongoing and subject to final court approval.

Furthermore, some claims would be subject to further litigation if certain terms of the applicable settlement agreements are not fulfilled and we exercise our walkaway rights.

Please refer to Note 12 to our consolidated financial statements titled “Commitments and Contingencies” for further information.

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Defense of litigation may also result in diversion of management attention from other priorities, which could have a material adverse effect on our financial condition and results of operations.

If our continuing efforts to create a Lean business and in-source production to reduce costs are not successful, our profitability may be negatively impacted or our business otherwise might be adversely affected .

We have undertaken various activities to incorporate Lean concepts and practices to more efficiently operate our business, including in-sourcing.

If our continuing efforts to create a Lean business, to in-source production and to support smart manufacturing to reduce costs are not successful, our profitability may be negatively impacted or our business otherwise might be adversely affected .

We have undertaken various activities to incorporate Lean concepts and practices to more efficiently operate our business, including in-sourcing and smart manufacturing.

We continue to look for opportunities to in-source production that is currently provided by third parties.

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The failure to realize such efficiencies and cost reduction benefits, or increases in the costs of doing business related to in-sourced production, could adversely impact our financial condition and results of operations.

Similarly, we continue to invest in smart manufacturing to drive structural cost reduction in our facilities, including aligning work to more efficient manufacturing centers, implementing advanced manufacturing capabilities such as digital initiatives, automation and robots, and closing facilities that are not required to meet future capacity and work needs.

Our success will depend on various factors, including our ability to either source or custom develop the necessary technology and components, and the digital transformation initiative’s cost-effectiveness, utility and competitive positioning.

If our digital transformation initiative fails to develop as we expect, or progresses more slowly than expected, such failure to realize efficiencies and cost reduction benefits could adversely impact our financial condition and results of operations.

A pandemic or similar public health crisis could have a material adverse impact on our ability to staff our operations.

While we believe that we have developed appropriate measures to protect the health and well-being of our employees in the event of future health crises, there can be no assurances that our measures will be sufficient to protect our employees in our workplace or that they may not otherwise be exposed to an illness outside of our workplace.

There can be no assurances that our measures to protect the health and wellbeing of our employees in the event of future health crises will be sufficient to protect our employees or that they may not otherwise be exposed to an illness outside of our workplace.

If a large or otherwise impactful number of our employees, including key employees, become ill, incapacitated or are otherwise unable or unwilling to continue working during any future health crises, our operations may be adversely impacted.

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Our continued success depends, in large part, on our ability to hire and retain highly qualified people, and if we are unable to do so, our business and operations may be impaired or disrupted.

Labor market conditions are challenging, and the shortage of highly qualified people has led to increased competition.

There is no assurance that we will be successful in attracting replacements to fill vacant positions, retaining successors to fill retirements or employees moving to new positions, or otherwise retaining qualified personnel.

In addition, the increasing complexity of legal, regulatory and compliance matters have

created additional responsibilities for our management and other personnel and can create significant distraction or diversion of their attention, which could have a material adverse effect on our ability to attract and retain such personnel.

In addition, the increasing complexity of legal, regulatory and compliance matters have created additional responsibilities for our management and other personnel and can create significant distraction or diversion of their attention, which could have a material adverse effect on our ability to attract and retain such personnel.

We could experience a failure of a key information technology system, process or site or a breach of information security, including a cybersecurity breach of one or more key information technology systems, networks, processes, associated sites or service providers;

We rely extensively on information technology (“IT”) systems to conduct business, including but not limited to interacting with Customers and suppliers, fulfilling orders, generating invoices, collecting and making payments, shipping products, providing Customer support, and fulfilling contractual obligations.

failure to manage these and other risks associated with the use of sophisticated technology could materially impact our business.

We rely extensively on information technology (“IT”) systems to conduct business, including but not limited to interacting with Customers and suppliers, fulfilling orders, generating invoices, collecting and making payments, manufacturing and shipping products, providing Customer support, and fulfilling contractual obligations.

In addition, we rely on networks and services, including internet sites, cloud and software-as-a-service solutions, data hosting, electronic payment systems, and processing facilities and tools and other hardware, software and technical applications and platforms, including some that employ artificial intelligence (“AI”), some of which are managed, hosted, provided and/or used by third-parties or their vendors, to assist in conducting our busines s.

While we have been the previous target of cyberattacks and security breaches, none of these attacks or breaches to date have had a material adverse effect on the Company.

We cannot guarantee that future cyberattacks, if successful, will not have a material effect on our business or financial results.

We cannot guarantee that future

cyberattacks, if successful, will not have a material effect on our business or financial results.

Numerous and evolving cybersecurity threats continue to pose potential risks to the security of our IT systems, networks and services, as well as the confidentiality, availability and integrity of our data, and we may fail to sufficiently adapt to them.

For instance, generative AI may be used by malicious actors to create more targeted phishing narratives, spread false information about us or our products, or otherwise enhance the social engineering capabilities of such malicious actors.

For instance, generative AI and other artificial intelligence technologies may be used by malicious actors to create more targeted phishing narratives, develop sophisticated malware, spread false information about us or our products, or otherwise enhance the social engineering and attack capabilities of such malicious actors.

Some of our products, services, and information technology systems contain or use open-source software, which poses additional risks, including potential security vulnerabilities, licensing compliance issues, and quality issues.

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Other legislative or governmental regulatory requirements may come into effect that may similarly increase our compliance obligations or significantly increase our exposure to financial penalties for noncompliance.

Likewise, governments and regulatory bodies worldwide are actively developing new laws, regulations and ethical guidelines governing AI use, including the European Union’s Artificial Intelligence Act.

Compliance with evolving and potentially inconsistent AI regulations across jurisdictions may be costly and complex.

Failure to comply could result in significant penalties, restrictions on our use of AI, or reputational harm.

The use of AI may also raise data privacy concerns, particularly if AI systems process sensitive health information subject to GDPR, HIPAA or other privacy regulations.

If our competitors deploy AI technologies more effectively than we do, we may lose market share or be unable to maintain our competitive position.

Failure to adequately manage AI-related risks could have a material adverse effect on our business, reputation, financial condition, and results of operations.

Our debt level or access to credit markets may limit our financial and business flexibility.

As of March 31, 2025, STERIS had approximately $2,043.7 million of indebtedness outstanding, which included $1,350.0 million of Senior Public Notes issued April 1, 2021, $674.2 million of Private Placement Senior Notes, and $34.8 million of borrowings outstanding under our Revolving Credit Facility (each as defined below).

STERIS’s ability to repay all the forgoing obligations will depend on, among other things, STERIS’s financial position and performance, as well as prevailing market conditions and other factors beyond our control.

Our indebtedness could have important consequences to our shareholders, including increasing risk associated with general adverse economic and industry conditions, limiting our ability to obtain additional financing to fund future working capital, capital expenditures and other general corporate requirements, requiring the use of a substantial portion of our cash flow from operations for the payment of principal and interest on indebtedness, thereby reducing our ability to use our cash flow to fund working capital, acquisitions, capital expenditures and general corporate matters, including dividend payments and stock repurchases, limiting our flexibility in planning for, or reacting to, changes in our business and our industry and creating a disadvantage compared to our competitors with less indebtedness.

As of March 31, 2026, STERIS had approximately $1,931.7 million of indebtedness outstanding (net of deferred financing fees), which included $1,350.0 million of Senior Public Notes issued April 1, 2021, $557.8 million of Private Placement Senior Notes, and $37.8 million o f borrowings outstanding under our Revolving Credit Facility (each as defined below).

STERIS’s ability to repay all the foregoing obligations will depend on, among other things, STERIS’s financial position and performance, as well as prevailing market conditions and other factors beyond our control.

working capital, acquisitions, capital expenditures and general corporate matters, including dividend payments and stock repurchases, limiting our flexibility in planning for, or reacting to, changes in our business and our industry and creating a disadvantage compared to our competitors with less indebtedness.

In addition, our ability and the ability of our Customers, suppliers and other business counterparties to obtain indebtedness and the cost thereof is dependent on credit profiles, prevailing market interest rates and other factors.

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We engage in acquisitions and affiliations, divestitures, and other business arrangements.

Our growth may be adversely affected if we are unable to successfully identify, price, and integrate strategic business candidates or otherwise optimize our business portfolio.

Our growth may be adversely affected if we are unable to successfully identify and price strategic business candidates or otherwise optimize our business portfolio.

Our success depends, in part, on strategic acquisitions and joint ventures, which are intended to complement or expand our businesses, divestiture of non-strategic businesses, and other assets, and other actions intended to optimize our portfolio of businesses.

This strategy depends upon our ability to identify, appropriately price, and complete these types of business development transactions or arrangements and to obtain any necessary financing.

In the last several fiscal years we have made a number of acquisitions and dispositions.

There can be no assurance that any acquisition or disposition will ultimately prove to be a strategic success.

Also, we may be unable to find or consummate future acquisitions and divestitures at acceptable prices and terms.

In recent fiscal years we have made a number of acquisitions, joint ventures and dispositions.

We may be unable to find or consummate future acquisitions, joint ventures opportunities and divestitures at acceptable prices and terms.

We continually evaluate potential business developments opportunities in the ordinary course of business.

Our success with respect to these recent and future acquisitions will depend on our ability to integrate the businesses acquired, retain key personnel, realize identified cost synergies, manage the expanded business footprint and otherwise execute our strategies.

Our success will also depend on our ability to develop satisfactory working arrangements with our strategic partners in joint ventures or other affiliations, or to divest or realign businesses.

Competition for strategic business candidates may result in increases in costs and price for acquisition candidates and market valuation issues may reduce the value available for divestiture of non-strategic businesses.

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risks associated with the assumption of contingent or other liabilities of acquisition targets or retention of liabilities for divested businesses and difficulties in obtaining financing.

Furthermore, assumptions that we have made with respect to acquisitions, dispositions or joint ventures, such as with respect to anticipated operating synergies or the costs associated with realizing such synergies, significant long-term cash flow generation, and the continuation of our investment grade credit profile, may not be realized.

The processes involved with disposing of our businesses, entering into joint ventures or post-acquisition integration, as well as the implementation of other strategic initiatives, may result in the loss of key employees, the disruption of ongoing business, changes in strategy or inconsistencies in standards, controls, procedures and policies.

There could also be potential unknown liabilities and unforeseen expenses that were not discovered or previously expected.

Although we conduct what we believe to be a prudent level of investigation regarding the operating and financial condition of the businesses, product or service lines, assets or technologies we purchase, divest or invest in, an unavoidable level of risk remains regarding their actual operating and financial condition, as well as their strategic fit.

We may not be able to ascertain actual value or understand potential liabilities until or after we actually assume operational control of these businesses, product or service lines, assets or technologies.

Our investments in our business and product offerings may not be as successful as anticipated.

From time to time, we may invest in technology, business infrastructure, new businesses, product offerings and manufacturing innovations and expansion of existing businesses, each of which may require substantial cash investments and management attention.

We believe cost-effective investments are essential to business growth and profitability;

however, significant investments are subject to typical risks and uncertainties inherent in developing a new business or expanding an existing business.

The failure of any significant investment to provide expected returns or profitability could have a material adverse effect on our financial results and divert management attention from more profitable business operations.

Our business realignment initiatives may not be as successful as anticipated.

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Future acquisitions or other capital requirements and investments will necessitate additional cash.

To the extent our

existing sources of cash are insufficient to fund these or other future activities, we have and may need to raise additional funds through new or expanded borrowing arrangements or equity issuances.

There can be no assurance that we will be able to obtain additional funds beyond those available under existing bank credit facilities on terms favorable to us, or at all, or that such facilities can be replaced when they terminate.

The integration of acquired businesses into STERIS may not be as successful as anticipated.

We have made large acquisitions of businesses.

The integration of acquired businesses into STERIS involves numerous operational, strategic, financial, accounting, legal, tax and other risks;

potential liabilities associated with the acquired businesses;

To the extent our existing sources of cash are insufficient to fund these or other future activities, we have in the past needed and may in the future need to raise additional funds through new or expanded financing arrangements, which could include further borrowings or equity issuances.

There can be no assurance that we will be able to obtain additional funds on terms favorable to us, or at all, or that our existing bank credit facilities or other indebtedness can be replaced or refinanced when they mature or terminate.

The integration of acquired businesses into STERIS or working arrangements with joint venture partners may not be as successful as anticipated.

The integration of acquired businesses into STERIS as well as the entry into and operation of strategic joint ventures involves numerous operational, strategic, financial, accounting, legal, tax and other risks;

potential liabilities associated with the acquired businesses or partners;

and uncertainties related to design, operation and integration of internal controls over financial reporting.

Difficulties in integrating acquired businesses into STERIS may result in the business performing differently than expected, in operational challenges, in strategic changes or in the failure to realize anticipated expense-related efficiencies.

STERIS’s existing businesses could also be negatively impacted by the integration actions.

Potential difficulties that may be encountered in the integration process include, among other factors:

These risks and difficulties may result in the business performing differently than expected, in operational challenges, in strategic changes or in the failure to realize anticipated expense-related efficiencies.

STERIS’s existing businesses could also be negatively impacted by integration actions or the administration of joint ventures.

Potential difficulties that may be encountered include, among other factors:

• the inability to successfully integrate the business of an acquired business into STERIS in a manner that permits STERIS to achieve the full revenue and cost savings anticipated from the acquisition;

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• integrating personnel from acquired businesses into STERIS while maintaining focus on providing consistent, high-quality products and services;

• potential unknown liabilities and unforeseen expenses associated with the acquisition;

• potential unknown liabilities and unforeseen expenses;

• loss of key employees;

• integrating relationships with Customers, vendors and business partners;

• performance shortfalls as a result of the diversion of management’s attention caused by integration activities;

• the disruption of, or the loss of momentum in, an acquired business and STERIS’s ongoing business or inconsistencies in standards, controls, procedures and policies.

• performance shortfalls as a result of the diversion of management’s attention caused by integration or joint venture activities;

• the disruption of, or the loss of momentum in a new business and STERIS’s ongoing business or inconsistencies in standards, controls, procedures and policies.

Past and future business acquisitions may not be as accretive to STERIS’s earnings per share and cash flow from operations per share, which may negatively affect the market price of STERIS shares.

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Any decrease or delay of any accretion to STERIS’s earnings per share or cash flow from operations per share could cause the price of the STERIS’s ordinary shares to decline.

STERIS has incurred and expects to incur significant transaction and related costs in connection with business acquisitions and dispositions, which may be in excess of those anticipated.

STERIS has incurred substantial expenses in connection with the negotiation and completion of past business acquisitions and dispositions, and expects to incur similar costs for any future business acquisitions or dispositions.

STERIS expects to incur non-recurring costs associated with the integrations of recent acquisitions into STERIS and working towards achieving the desired synergies of such acquisitions.

STERIS has incurred and expects to incur significant transaction and related costs in connection with strategic transactions, which may be in excess of those anticipated.

STERIS has incurred substantial expenses in connection with the negotiation and completion of past business acquisitions, dispositions and joint ventures, and expects to incur similar costs for any future strategic transactions.

The anticipated benefits and cost savings from such initiatives may not be realized fully or at all, may take longer to realize than expected, may require more non-recurring costs and expenditures to realize than expected or could have other adverse effects that we do not currently foresee.

STERIS expects to incur non-recurring costs associated with the integrations of recent acquisitions into STERIS, joint ventures and working towards achieving desired synergies.

These fees and costs have been, and may continue to be, substantial.

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STERIS also expects to incur and has incurred costs to consolidate facilities and systems.

Additional unanticipated costs may be incurred in the integration of any acquired business.

Although STERIS expects that the elimination of duplicative costs, as well as the realization of other efficiencies related to the integration of acquired businesses, should allow STERIS to offset integration-related costs over time, this net benefit may not be achieved in the near term, or at all.

Additional unanticipated costs may be incurred in connection with strategic transactions.

Although STERIS expects that the elimination of duplicative costs, as

well as the realization of other efficiencies related to the integration of acquired businesses, should allow STERIS to offset integration-related costs over time, this net benefit may not be achieved in the near term, or at all.

STERIS may not achieve expected returns and benefits in connection with dispositions, which may require continued involvement in a divested business, such as through transition service agreements, guarantees, indemnities or other financial obligations.

Under these arrangements, the performance of the divested business, or other conditions outside our control, could affect our future financial results.

The costs described above, as well as other unanticipated costs and expenses, could have a material adverse effect on the financial condition and operating results.

We may fail to realize all of the anticipated benefits of our strategic business initiatives, as well as acquisitions, dispositions or joint ventures, or those benefits may take longer to realize than expected.

The success of our strategic business initiatives depend, in part, on our ability to realize the anticipated benefits and cost savings from such initiatives.

These anticipated benefits and cost savings may not be realized fully or at all, may take longer to realize than expected, may require more non-recurring costs and expenditures to realize than expected or could have other

adverse effects that we do not currently foresee.

There could also be potential unknown liabilities and unforeseen expenses that were not discovered or previously expected.

We have recorded goodwill and other intangible assets that could become impaired and result in material non-cash charges to our results of operation in the future.

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If we determine that these items have become impaired in the future, it may have a material adverse effect on our financial condition and results of operations.

As of March 31, 2025 , we had recorded goodwill of $4 billion and other intangible assets, net of accumulated amortization of $2 billion .

As of March 31, 2026 , we had recorded goodwill o f $4 billion and other intangible assets, net of accumulated amortization of $2 billion.

Goodwill represents the excess of purchase price over the estimated fair value assigned to the net tangible and identifiable intangible assets of a business acquired.

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

What changed 10-K

Item 1A. Risk Factors