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Item 1. Financial Statements

2025-10-24 compared with 2025-07-28 · 273 added, 231 removed, 908 unchanged (36% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

FOR THE SECOND QUARTER AND SIX MONTHS ENDED JUNE 29, 2025 AND JUNE 30, 2024

FOR THE THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 28, 2025 AND SEPTEMBER 29, 2024

(Unaudited — Amounts in millions, except per share amounts)

Second Quarter Six Months

Third Quarter Nine Months

2025 2024 2025 2024

25 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

FOR THE SECOND QUARTER AND SIX MONTHS ENDED JUNE 29, 2025 AND JUNE 30, 2024

FOR THE THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 28, 2025 AND SEPTEMBER 29, 2024

(Unaudited — Amounts in millions)

Second Quarter Six Months

Third Quarter Nine Months

2025 2024 2025 2024

12 unchanged sentences

(Unaudited — Amounts in millions, except share amounts)

June 29, 2025 December 29, 2024

September 28, 2025 December 29, 2024

Current Assets

5 unchanged sentences

Total current assets 3,222.9 2,944.6

Property, plant and equipment, net of accumulated depreciation and amortization of $ 1,068.6 at June 29, 2025 and $ 1,012.1 at December 29, 2024

Property, plant and equipment, net of accumulated depreciation and amortization of $ 1,091.4 at September 28, 2025 and $ 1,012.1 at December 29, 2024

Goodwill 8,651.7 7,990.5

20 unchanged sentences

issued shares:

47,424,847 at June 29, 2025 and 47,432,888 at December 29, 2024;

47,424,847 at September 28, 2025 and 47,432,888 at December 29, 2024;

outstanding shares:

46,884,559 at June 29, 2025 and 46,706,612 at December 29, 2024

46,950,255 at September 28, 2025 and 46,706,612 at December 29, 2024

Additional paid-in capital 4,386.7 4,414.5

Retained earnings 6,865.2 6,266.7

Treasury stock, 540,288 shares at June 29, 2025 and 726,276 at December 29, 2024

Treasury stock, 474,592 shares at September 28, 2025 and 726,276 at December 29, 2024

( 194.4 ) ( 292.4 )

29 unchanged sentences

0.5 4,389.2 ( 220.3 ) 6,665.2 ( 457.7 ) 10,376.9

Net income (loss) — — — 220.7 — 220.7

Acquisition of redeemable noncontrolling interest

— — — ( 20.7 ) — ( 20.7 )

Other comprehensive income (loss), net of tax — — — — ( 39.5 ) ( 39.5 )

Treasury stock issued — ( 25.9 ) 25.9 — — —

Stock-based compensation and other

— 10.4 — — — 10.4

Exercise of stock options — 13.0 — — — 13.0

Balance, September 28, 2025

$ 0.5 $ 4,386.7 $ ( 194.4 ) $ 6,865.2 $ ( 497.2 ) $ 10,560.8

TELEDYNE TECHNOLOGIES INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (continued)

(Unaudited — Amounts in millions)

Common Stock Additional Paid-in Capital Treasury Stock Retained Earnings Accumulated Other Comprehensive Income (Loss) Total

20 unchanged sentences

0.5 4,435.9 ( 191.9 ) 5,806.2 ( 731.0 ) 9,319.7

Net income (loss) — — — 262.0 — 262.0

Other comprehensive income (loss), net of tax — — — — 137.7 137.7

Treasury stock issued — ( 9.1 ) 9.1 — — —

Treasury stock repurchased

— — ( 138.8 ) — — ( 138.8 )

Stock-based compensation and other

— 8.6 — — — 8.6

Exercise of stock options — 5.0 — — — 5.0

Balance, September 29, 2024

$ 0.5 $ 4,440.4 $ ( 321.6 ) $ 6,068.2 $ ( 593.3 ) $ 9,594.2

The accompanying notes are an integral part of these condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 29, 2025 AND JUNE 30, 2024

FOR THE NINE MONTHS ENDED SEPTEMBER 28, 2025 AND SEPTEMBER 29, 2024

(Unaudited — Amounts in millions)

22 unchanged sentences

Proceeds from exercise of stock options 47.2 16.5

Acquisition of redeemable noncontrolling interest

Purchases of treasury stock, including excise tax

9 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

June 29, 2025

September 28, 2025

Basis of Presentation

3 unchanged sentences

The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the related notes in Teledyne’s Annual Report on Form 10-K for the fiscal year ended December 29, 2024 (“2024 Form 10-K”).

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly, in all material respects, Teledyne’s consolidated financial position as of June 29, 2025 and the consolidated results of operations, consolidated comprehensive income (loss) and consolidated cash flows for the second quarter and six months ended June 29, 2025.

The results of operations and cash flows for the period ended June 29, 2025 are not necessarily indicative of the results of operations or cash flows to be expected for any subsequent quarter or the full fiscal year.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly, in all material respects, Teledyne’s consolidated financial position as of September 28, 2025, and the consolidated results of operations, consolidated comprehensive income (loss) and consolidated cash flows for the third quarter and nine months ended September 28, 2025.

The results of operations and cash flows for the period ended September 28, 2025, are not necessarily indicative of the results of operations or cash flows to be expected for any subsequent quarter or the full fiscal year.

Recent Accounting Standards

10 unchanged sentences

The Company is evaluating the impact of adopting this guidance on its consolidated financial statements.

Other ASUs issued but not effective until after June 29, 2025, are not expected to have a material effect on the Company’s consolidated financial position, annual results of operations and/or cash flows.

Other ASUs issued but not effective until after September 28, 2025, are not expected to have a material effect on the Company’s consolidated financial position, annual results of operations and/or cash flows.

Business Acquisitions

2025 Acquisitions

During the third quarter of 2025, the Company acquired the redeemable noncontrolling interest of NL Acoustics for $ 27.2 million in cash, with the acquisition of the noncontrolling interest treated as an equity transaction during the period.

During the third quarter of 2025, the Company acquired the assets of Maretron, including the brand’s Octoplex, MPower and MConnect product lines from Littelfuse, Inc.

The Maretron assets are part of the Digital Imaging segment, and the acquisition is not material for further disclosure.

During the first quarter of 2025, the Company acquired Micropac Industries, Inc.

1 unchanged sentence

Micropac, founded in 1963 and headquartered in Garland, Texas, designs and manufactures microelectronic circuits, optoelectronic components and sensor and display assemblies primarily for military, aerospace and medical applications.

Micropac is part of the Aerospace & Defense Electronics segment.

Micropac is part of the Aerospace and Defense Electronics segment.

The Company funded the acquisition from cash on hand.

Goodwill resulting from the Micropac acquisition will not be deductible for tax purposes.

Optical Systems and Advanced Electronics Systems businesses

Optical Systems and Advanced Electronics Systems (“Qioptiq”) businesses

During the first quarter of 2025 , the Company acquired select aerospace and defense electronics businesses of Excelitas Technologies C orp.

(“Excelitas”) for approximately $ 702.8 million in cash, net of cash acquired, and subject to certain adjustments.

The acquisition includes the Optical Systems ( “ OS ” ) business known under the Qioptiq ® brand which is based in Northern Wales, UK, as well as the U.S.-based Advanced Electronics Systems ( “ AES ” ) business (collectively, “OS and AES businesses”, or “Qioptiq”).

The OS and AES businesses are part of the Aerospac e and Defense Electronics segment.

The acquisition includes the Optical Systems ( “ OS ” ) business which is based in Northern Wales, UK, as well as the U.S.-based Advanced Electronics Systems ( “ AES ” ) business (collectively, “OS and AES businesses”, or “Qioptiq”).

Qioptiq is part of the Aerospac e and Defense Electronics segment.

The Company funded the acquisition from available borrowings on the credit facility as well as from cash on hand.

11 unchanged sentences

Goodwill resulting from the Valeport acquisition will not be deductible for tax purposes.

The following tables show the purchase price (net of cash acquired), goodwill acquired, and acquired intangible assets for these acquisitions (in millions):

The following tables show the purchase price (net of cash acquired), goodwill acquired, and acquired intangible assets for the Micropac, Qioptiq and the 2024 acquisitions (in millions):

Acquisitions Acquisition Date Consideration Transferred (a) Goodwill Acquired Acquired Intangible Assets

OS and AES businesses (Qioptiq)

February 3, 2025 $ 702.8 $ 446.6 $ 183.6

9 unchanged sentences

The differences between the fair value of the consideration paid and the estimated fair value of the assets and liabilities acquired was recorded as goodwill.

The fair value of the acquired identifiable assets and liabilities for the OS and AES businesses (Qioptiq) and Micropac are provisional pending finalization of the Company’s acquisition accounting, including the measurement of tax basis in certain jurisdictions and the resulting deferred taxes that might arise from book and tax basis differences, if any.

The fair value of the acquired identifiable assets and liabilities for Qioptiq and Micropac are provisional pending finalization of the Company’s acquisition accounting, including the measurement of tax basis in certain jurisdictions and the resulting deferred taxes that might arise from book and tax basis differences, if any.

Pro forma results of operations, the revenue and net income subsequent to the acquisition date, and a more detailed breakout of the major classes of assets and liabilities acquired for these acquisitions have not been presented because the effects of these acquisitions both individually and in the aggregate were not material to the Company’s financial results.

8 unchanged sentences

Corporate expense primarily includes administrative expenses relating to the corporate office not allocated to the segments.

In the first quarter of 2025, the Company completed two acquisitions, and the financial results of these acquisitions have been included since the date of the acquisition and are part of the Aerospace and Defense Electronics segment.

In the first nine months of 2025, the Company completed three acquisitions, and the financial results of these acquisitions have been included since the date of the acquisition and are part of the Digital Imaging and Aerospace and Defense Electronics segments.

In 2024, the Company completed two acquisitions, and the financial results of these acquisitions have been included since the date of the acquisition and are part of the Digital Imaging and Instrumentation segments.

1 unchanged sentence

The following table presents net sales, operating expenses and operating income by segment (dollars in millions):

Second Quarter % Six Months %

Third Quarter % Nine Months %

Net Sales (a):

5 unchanged sentences

Total net sales $ 1,539.5 $ 1,443.5 6.7 % $ 4,503.1 $ 4,167.7 8.0 %

(a) Net sales exclude inter-segment sales of $ 7.2 million and $ 11.0 million for the second quarter and first six months of 2025, respectively, and $ 8.5 million and $ 13.3 million for the second quarter and first six months of 2024, respectively.

Second Quarter % Six Months %

(a) Net sales exclude inter-segment sales of $ 6.6 million and $ 17.5 million for the third quarter and first nine months of 2025, respectively, and $ 5.9 million and $ 19.2 million for the third quarter and first nine months of 2024, respectively.

Third Quarter % Nine Months %

Cost of sales:

6 unchanged sentences

$ 880.0 $ 823.9 6.8 % $ 2,579.5 $ 2,375.6 8.6 %

Second Quarter % Six Months %

Third Quarter % Nine Months %

Selling, general and administrative:

6 unchanged sentences

$ 216.2 $ 207.4 4.2 % $ 635.6 $ 613.5 3.6 %

Second Quarter % Six Months %

Third Quarter % Nine Months %

Research and development:

6 unchanged sentences

$ 83.4 $ 73.0 14.2 % $ 240.1 $ 221.2 8.5 %

Second Quarter % Six Months %

Third Quarter % Nine Months %

Acquired intangible asset amortization:

6 unchanged sentences

* Not meaningful

Second Quarter % Six Months %

Third Quarter % Nine Months %

Operating income (loss):

12 unchanged sentences

The following table provides a summary of the net sales by product line for the Instrumentation segment (in millions):

Second Quarter Six Months

Third Quarter Nine Months

Instrumentation 2025 2024 2025 2024

6 unchanged sentences

Identifiable assets:

June 29, 2025 December 29, 2024

September 28, 2025 December 29, 2024

Digital Imaging $ 11,163.4 $ 10,942.4

5 unchanged sentences

Revenue Recognition and Contract Balances

Approximately 70 % of the Company’s net sales are recognized at a point in time, with the remaining 30 % of net sales recognized over time.

Prior to the acquisition of Qioptiq, approximately 70 % of the Company’s revenue was recognized at a point in time, with the remaining 30 % of revenue recognized over time.

The majority of Qioptiq’s revenue is recognized over time.

In future periods, the Company expects approximately 40 % of revenue to be recognized over time, with the remaining 60 % recognized at a point in time.

The Company disaggregates its revenue from contracts with customers by customer type and geographic region for each segment, as management believes it best depicts how the nature, amount, timing and uncertainty of its revenue and cash flows are affected by economic factors.

Second Quarter Ended

June 29, 2025

Second Quarter Ended

June 29, 2025

Third Quarter Ended

September 28, 2025

Third Quarter Ended

September 28, 2025

Customer Type Geographic Region (c)

9 unchanged sentences

Six Months Ended

June 29, 2025

Six Months Ended

June 29, 2025

Nine Months Ended

September 28, 2025

Nine Months Ended

September 28, 2025

Customer Type Geographic Region (c)

9 unchanged sentences

Second Quarter Ended

June 30, 2024

Second Quarter Ended

June 30, 2024

Third Quarter Ended

September 29, 2024

Third Quarter Ended

September 29, 2024

Customer Type Geographic Region (c)

9 unchanged sentences

Six Months Ended

June 30, 2024

Six Months Ended

June 30, 2024

Nine Months Ended

September 29, 2024

Nine Months Ended

September 29, 2024

Customer Type Geographic Region (c)

11 unchanged sentences

Net sales in the Engineered Systems segment are typically between 45 % and 55 % fixed price contracts in a given reporting period, with the balance of net sales derived from cost-reimbursable type contracts.

For the six months ended June 29, 2025, approximately 47 % of net sales in the Engineered Systems segment were derived from fixed price contracts.

For the nine months ended September 28, 2025, approximately 46 % of net sales in the Engineered Systems segment were derived from fixed price contracts.

Contract Liabilities

Contract Liabilities by Balance Sheet Location (in millions) June 29, 2025

Contract Liabilities by Balance Sheet Location (in millions) September 28, 2025

December 29, 2024

2 unchanged sentences

Total contract liabilities $ 402.3 $ 343.1

The Company recognized revenue of $ 152.7 million during the six months ended June 29, 2025, from contract liabilities that existed at the beginning of year.

The Company recognized revenue of $ 192.7 million during the nine months ended September 28, 2025, from contract liabilities that existed at the beginning of year.

Remaining Performance Obligations

Remaining performance obligations represent the transaction price of firm orders for which work has not been performed as of the period end date and exclude unexercised contract options and potential orders under ordering-type contracts (e.g., indefinite-delivery, indefinite-quantity).

As of June 29, 2025, the aggregate amount of the transaction price allocated to remaining performance obligations was $ 4,452.8 million.

As of September 28, 2025, the aggregate amount of the transaction price allocated to remaining performance obligations was $ 4,569.2 million.

The Company expects approximately 68 % of remaining performance obligations to be recognized into revenue within the next 12 months, with the remaining 32 % recognized thereafter.

7 unchanged sentences

Contract cost and revenue estimates for significant contracts are generally reviewed and reassessed quarterly.

The net aggregate effects of these changes in estimates on contracts accounted for under the cost-to-cost method in the first six months of 2025 was $ 1.9 million of favorable operating income compared with $ 2.1 million of favorable operating income in the first six months of 2024.

The net aggregate effects of these changes in estimates on contracts accounted for under the cost-to-cost method in the first nine months of 2025 was $ 8.6 million of favorable operating income compared with $ 5.1 million of favorable operating income in the first nine months of 2024.

None of the effects of changes in estimates on any individual contract were material to the condensed consolidated statements of income (loss) for any period presented.

6 unchanged sentences

Foreign currency changes and other 150.8 29.6 23.7 — 204.1

Balance at June 29, 2025

Balance at September 28, 2025

$ 7,010.9 $ 984.9 $ 638.3 $ 17.6 $ 8,651.7

1 unchanged sentence

Acquired intangible assets consisted of the following (in millions):

June 29, 2025 December 29, 2024

September 28, 2025 December 29, 2024

Gross Carrying Amount

17 unchanged sentences

At the assessment date in the fourth quarter of 2024, the estimated fair value of the FLIR reporting unit exceeded its carrying value by approximately $ 420 million, or 5 %, and the FLIR reporting unit had $ 5,856.5 million of goodwill at the prior year assessment date.

As of June 29, 2025, the FLIR reporting unit had $ 5,922.1 million of goodwill, with the change in value from the prior year assessment date related to the impact of foreign currency translation.

As of September 28, 2025, the FLIR reporting unit had $ 5,917.3 million of goodwill, with the change in value from the prior year assessment date related to the impact of foreign currency translation.

Although the assumptions used in the Company’s prior year discounted cash flow model and market approach are based on assumptions that are considered reasonable by management and consistent with the plans and estimates management uses to operate the underlying businesses, there is significant judgment in determining the expected results of the FLIR reporting unit.

19 unchanged sentences

Cash Equivalents

The Company had $ 102.1 million and $ 304.1 million of cash equivalents at June 29, 2025, and December 29, 2024, respectively.

The Company had $ 313.6 million and $ 304.1 million of cash equivalents at September 28, 2025, and December 29, 2024, respectively.

The Company has categorized its cash equivalents as a Level 1 financial asset, measured at fair value based on quoted prices in active markets of identical assets.

Accounts Receivable, Net

Accounts receivable is presented net of an allowance for estimated credit losses of $ 14.5 million at June 29, 2025 and $ 15.5 million at December 29, 2024.

Accounts receivable is presented net of an allowance for estimated credit losses of $ 15.7 million at September 28, 2025 and $ 15.5 million at December 29, 2024.

Inventories, Net

2 unchanged sentences

Inventory balances are summarized as follows (in millions):

June 29, 2025 December 29, 2024

September 28, 2025 December 29, 2024

Raw materials and supplies $ 637.0 $ 559.2

14 unchanged sentences

Long-Term Debt (in millions):

June 29, 2025 December 29, 2024

September 28, 2025 December 29, 2024

$ 1.2 billion credit facility due June 2029

9 unchanged sentences

Total long-term debt, net of current portion $ 2,083.2 $ 2,648.7

At June 29, 2025, $ 1,168.0 million was available under the $ 1.2 billion credit facility after reductions of $ 32.0 million in outstanding letters of credit.

The Company’s bank credit agreements requires it to comply with various financial and operating covenants, and at June 29, 2025, the Company was in compliance with these covenants.

At September 28, 2025, $ 1,168.7 million was available under the $ 1.2 billion credit facility after reductions of $ 31.3 million in outstanding letters of credit.

The Company’s bank credit agreements require the Company to comply with various financial and operating covenants, and at September 28, 2025, the Company was in compliance with these covenants.

In the first nine months of 2025, the Company repurchased and retired $ 118.2 million of principal of its fixed rate senior notes for $ 107.7 million in cash.

The income tax provision is calculated using an estimated annual effective tax rate based upon estimates of annual income, permanent items, statutory tax rates and planned tax strategies in the various jurisdictions in which the Company operates, except that certain loss jurisdictions and discrete items such as the resolution of uncertain tax positions and stock-based accounting income tax benefits are treated separately.

Second Quarter Six Months

Third Quarter Nine Months

(dollars in millions) 2025 2024 2025 2024

2 unchanged sentences

Effective tax rate 19.3 % ( 2.8 )% 19.8 % 12.7 %

(a) The second quarter of 2025 includes net discrete income tax benefits of $ 8.4 million and the first six months of 2025 includes net discrete income tax benefits of $ 12.1 million, respectively.

The second quarter of 2024 includes net discrete income tax benefits of $ 0.7 million and the first six months of 2024 includes net discrete income tax benefits of $ 5.1 million, respectively.

(a) The third quarter of 2025 includes net discrete income tax benefits of $ 4.9 million and the first nine months of 2025 includes net discrete income tax benefits of $ 17.0 million, respectively.

The third quarter of 2024 includes net discrete income tax benefits of $ 62.3 million and the first nine months of 2024 includes net discrete income tax benefits of $ 67.4 million, respectively.

Pension Plans

Second Quarter Six Months

Third Quarter Nine Months

2025 2024 2025 2024

12 unchanged sentences

The Company uses the Black–Scholes option pricing model to determine the fair value of stock options.

Stock-based compensation expense was $ 11.3 million and $ 20.2 million for the second quarter and first six months of 2025, respectively, and $ 9.3 million and $ 21.3 million for the second quarter and first six months of 2024, respectively.

Stock option activity for the second quarter and first six months of 2025 is as follows:

Second Quarter Six Months

Stock-based compensation expense was $ 10.5 million and $ 30.7 million for the third quarter and first nine months of 2025, respectively, and $ 8.7 million and $ 30.0 million for the third quarter and first nine months of 2024, respectively.

Stock option activity for the third quarter and first nine months of 2025 is as follows:

Third Quarter Nine Months

Shares Weighted Average Exercise Price

Shares Weighted Average

Exercise Price

Shares Weighted Average Exercise Price

Beginning balance 1,034,778 $ 299.25 1,135,749 $ 278.34

5 unchanged sentences

(a) In the second quarter of 2025, the Company granted stock options with a grant date fair value of $ 179.30 per share.

Restricted stock activity for the second quarter and first six months of 2025 is as follows:

Second Quarter Six Months

Restricted stock activity for the third quarter and first nine months of 2025 is as follows:

Third Quarter Nine Months

Shares Weighted Average Fair Value per Share

7 unchanged sentences

The weighted average number of common shares used in the calculation of basic and diluted earnings per share consisted of the following (in millions):

Second Quarter Six Months

Third Quarter Nine Months

2025 2024 2025 2024

2 unchanged sentences

Weighted average diluted common shares outstanding 47.5 47.3 47.4 47.7

For the second quarter and first six months of 2024, the Company excluded approximately 0.2 million of stock options in the computation of diluted earnings per share because the effect of their inclusion would have been anti-dilutive.

For the second quarter and first six months of 2025, the Company did not have any stock options that would have been anti-dilutive.

For the third quarter and first nine months of 2024, the Company excluded approximately 0.2 million of stock options in the computation of diluted earnings per share because the effect of their inclusion would have been anti-dilutive.

For the third quarter and first nine months of 2025, the amount of excluded stock options in the computation of diluted earnings per share was not material.

Stock Repurchases

In July 2025, our Board of Directors approved a stock repurchase program authorizing the Company to repurchase up to $ 2.0 billion of Teledyne’s common stock.

In July 2025, the Company’s Board of Directors approved a stock repurchase program authorizing the Company to repurchase up to $ 2.0 billion of Teledyne’s common stock.

This authorization superseded the remaining prior open stock repurchase programs authorized by the Board of Directors.

3 unchanged sentences

The repurchase program is expected to remain open continuously, and the number of shares purchased will depend on a variety of factors such as share price, levels of cash available, acquisitions and alternative investment opportunities available immediately or longer-term, and other regulatory, market or economic conditions.

The Company currently intend to fund future share repurchases, if any, with cash on hand and available borrowings under the Company’s credit facility.

No repurchases under any authorizations were made in the second quarter and first six months of 2025.

The Company currently intends to fund future share repurchases, if any, with cash on hand and available borrowings under the Company’s credit facility.

No repurchases under any authorizations were made in the third quarter and first nine months of 2025.

Accumulated Other Comprehensive Income (Loss)

The changes in accumulated other comprehensive income (loss) (“AOCI”) by component, net of tax, as applicable, for the second quarter and six months ended June 29, 2025, and June 30, 2024, are as follows (in millions):

The changes in accumulated other comprehensive income (loss) (“AOCI”) by component, net of tax, as applicable, for the third quarter and nine months ended September 28, 2025, and September 29, 2024, are as follows (in millions):

Foreign Currency Translation Cash Flow Hedges

Pension and Postretirement Benefits Total

Balance at March 30, 2025

Balance at June 29, 2025

$ ( 227.1 ) $ 1.6 $ ( 232.2 ) $ ( 457.7 )

2 unchanged sentences

Net other comprehensive income (loss) ( 40.5 ) ( 1.3 ) 2.3 ( 39.5 )

Balance at June 29, 2025

Balance at September 28, 2025

$ ( 267.6 ) $ 0.3 $ ( 229.9 ) $ ( 497.2 )

1 unchanged sentence

Pension and Postretirement Benefits Total

Balance at March 31, 2024

Balance at June 30, 2024

$ ( 487.3 ) $ 1.7 $ ( 245.4 ) $ ( 731.0 )

2 unchanged sentences

Net other comprehensive income (loss) 136.2 — 1.5 137.7

Balance at June 30, 2024

Balance at September 29, 2024

$ ( 351.1 ) $ 1.7 $ ( 243.9 ) $ ( 593.3 )

5 unchanged sentences

Net other comprehensive income (loss) 334.7 2.5 5.5 342.7

Balance at June 29, 2025

Balance at September 28, 2025

$ ( 267.6 ) $ 0.3 $ ( 229.9 ) $ ( 497.2 )

5 unchanged sentences

Net other comprehensive income (loss) 41.6 ( 6.5 ) 5.7 40.8

Balance at June 30, 2024

Balance at September 29, 2024

$ ( 351.1 ) $ 1.7 $ ( 243.9 ) $ ( 593.3 )

The reclassifications out of AOCI to net income for the second quarter ended June 29, 2025, and June 30, 2024 are as follows (in millions):

Amount Reclassified from AOCI for the Quarter Ended June 29, 2025

The reclassifications out of AOCI to net income for the third quarter ended September 28, 2025, and September 29, 2024, are as follows (in millions):

Amount Reclassified From AOCI for the Quarter Ended September 28, 2025

Amount Reclassified From AOCI for the Quarter Ended

June 30, 2024

September 29, 2024

Statement of Income (Loss) Presentation

5 unchanged sentences

Amortization of defined benefit pension and postretirement plan items:

Amortization of prior service cost $ — $ ( 0.1 ) Costs and expenses

Amortization of net prior service cost (income)

$ 0.1 $ ( 0.1 ) Costs and expenses

Amortization of net actuarial loss 2.9 2.3 Costs and expenses

2 unchanged sentences

Total $ 2.3 $ 1.5

Amount Reclassified from AOCI for the Six Months Ended June 29, 2025

Amount Reclassified from AOCI for the Six Months Ended June 30, 2024

Amount Reclassified From AOCI for the Nine Months Ended September 28, 2025

Amount Reclassified From AOCI for the Nine Months Ended September 29, 2024

Statement of Income (Loss) Presentation

5 unchanged sentences

Amortization of defined benefit pension and postretirement plan items:

Amortization of prior service cost $ 0.1 $ ( 0.2 ) Costs and expenses

Amortization of net prior service cost (income)

$ 0.2 $ ( 0.3 ) Costs and expenses

Amortization of net actuarial loss 7.0 8.1 Costs and expenses

11 unchanged sentences

The Company utilizes foreign currency forward contracts to reduce the volatility of cash flows primarily related to forecasted revenue and expenses denominated in Canadian dollars for the Canadian companies, and in British pounds for the UK companies.

As of June 29, 2025, foreign currency forward contracts in Canadian dollars designated as cash flow hedges have maturities ranging from September 2025 to February 2026.

As of June 29, 2025, foreign currency forward contracts in British pounds designated as cash flow hedges have maturities ranging from September 2025 to February 2026.

As of September 28, 2025, foreign currency forward contracts in Canadian dollars designated as cash flow hedges have maturities ranging from October 2025 to February 2026.

As of September 28, 2025, foreign currency forward contracts in British pounds designated as cash flow hedges have maturities ranging from October 2025 to February 2026.

The Company utilizes cross-currency swaps to hedge portions of the Company’s euro denominated net investments against the effect of exchange rate fluctuations on the translation of foreign currency balances to the U.S.

In the first half 2025, the Company entered cross-currency swaps designated as net investment hedges with a total notional amount of € 450.0 million to hedge portions of the Company’s euro denominated net investments against the effect of exchange rate fluctuations on the translation of foreign currency balances to the U.S.

In the first nine months of 2025, the Company entered cross-currency swaps designated as net investment hedges with a total notional amount of € 450.0 million to hedge portions of the Company’s euro denominated net investments against the effect of exchange rate fluctuations on the translation of foreign currency balances to the U.S.

These cross-currency swaps mature between September 2026 and September 2030.

5 unchanged sentences

These foreign currency forward contracts are not designated as accounting hedges.

The gain or loss resulting from a change in fair value of a derivative instrument that is not designated in accounting hedge is recognized immediately in earnings and intended to, at a minimum, partially offset the transaction gains and losses recognized in earnings.

The gain or loss resulting from a change in fair value of a derivative instrument that is not designated an accounting hedge is recognized immediately in earnings and intended to, at a minimum, partially offset the transaction gains and losses recognized in earnings.

Derivative Instruments

The following is a summary of the gain (loss) included in the condensed consolidated statements of income (loss) and comprehensive income (loss) related to the derivative instruments described above (in millions):

Second Quarter Six Months

Third Quarter Nine Months

2025 2024 2025 2024

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Fair Value Liability

June 29, 2025 December 29, 2024 June 29, 2025 December 29, 2024 June 29, 2025 December 29, 2024

September 28, 2025 December 29, 2024 September 28, 2025 December 29, 2024 September 28, 2025 December 29, 2024

Derivatives designated as hedging instruments

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All fair values for these derivatives were measured using Level 2 hierarchy information as defined by the accounting policies (in millions):

June 29, 2025 December 29, 2024

September 28, 2025 December 29, 2024

Foreign currency forward contracts $ 1.2 $ 1.0

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Gross derivative assets and liabilities are subject to legally enforceable master netting agreements, for which the Company has not elected to present net amounts on the condensed consolidated balance sheets.

The effect of such right of setoff on the Company’s financial position was $ 0.2 million as of June 29, 2025, and December 29, 2024.

The effect of such right of setoff on the Company’s financial position was $ 0.2 million as of September 28, 2025, and December 29, 2024.

Financial Instruments Not Recorded at Fair Value

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The Company’s long-term debt is considered a Level 2 and is valued based on observable market data.

As of June 29, 2025, and December 29, 2024, the aggregate fair values of our borrowings were $ 2,446.0 million and $ 2,395.0 million, respectively, and the carrying values were $ 2,632.7 million and $ 2,666.2 million, respectively.

As of September 28, 2025, and December 29, 2024, the aggregate fair values of the Company’s borrowings were $ 2,394.3 million and $ 2,395.0 million, respectively, and the carrying values were $ 2,547.8 million and $ 2,666.2 million, respectively.

The cost, if any, to terminate off-balance sheet financial instruments (primarily letters of credit) is not significant.

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Environmental Remediation Obligations

At June 29, 2025, the Company’s reserves for environmental remediation obligations totaled $ 6.3 million, of which $ 3.0 million is included in current accrued liabilities.

At September 28, 2025, the Company’s reserves for environmental remediation obligations totaled $ 6.1 million, of which $ 3.0 million is included in current accrued liabilities.

At December 29, 2024, the Company’s reserves for environmental remediation obligations totaled $ 6.5 million.

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Subsequent Events

In the third quarter of 2025, the Company acquired the assets of Maretron, including the brand’s Octoplex, MPower and MConnect product lines from Littelfuse, Inc.

TransponderTech

In the third quarter of 2025, the Company announced that it had entered into an agreement to acquire the TransponderTech business headquartered in Linkoping, Sweden from Saab AB.

The agreement to acquire the TransponderTech business includes a portfolio of connected commercial maritime products, including Automatic Identification System, VHF Data Exchange System and Global Navigation Satellite System technologies.

The transaction is expected to close in the fourth quarter of 2025, and will be included in the Digital Imaging segment.

Management ’ s Discussion and Analysis of Financial Condition and Results of Operations

13 unchanged sentences

We continually evaluate our businesses to ensure that they are aligned with our strategy.

Consistent with our strategy, we completed two acquisitions each in the first half of 2025 and the full year of 2024.

The financial results of the completed acquisitions have been included since the respective date of each acquisition.

Subsequent to the end of the second quarter of 2025, we completed an additional acquisition.

Trends and Other Matters Affecting Our Business

In early 2025, the U.S.

Presidential administration implemented significant new tariffs on foreign imports impacting multiple countries, commodities and industries, and these new tariffs and export restrictions also prompted retaliatory tariffs and export restrictions from certain countries.

As of July 2025, certain tariffs and retaliatory tariffs have been delayed, but a number of the new tariffs remain in effect, including significant tariffs and trade sanctions between the United States and China.

China has also restricted the export of certain rare earth minerals which are used in our products.

The global trade environment continues to be highly dynamic, including new potential tariffs and retaliatory tariffs, and a number of the tariffs remain in effect.

There have been continuing significant tariffs and trade sanctions between the United States and China, including in each country designation of persons with trading restrictions.

China has also restricted the export of certain rare earth minerals which are used in our products, which could disrupt the supply chain for these minerals and components made from these materials.

Tariffs, trade restrictions and retaliatory measures could result in revenue reductions, cost increases on material used in our products or significant production delays, which could adversely affect our business, financial condition, operational results and cash flows.

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To date, our strategies have helped minimize our exposure to these conditions.

In July 2025, the “One Big Beautiful Bill Act” (the “Act”) was enacted into law.

The Act includes changes to U.S.

tax law, including provisions to accelerate tax deductions for qualified property and research expenditures.

We are in the process of evaluating the impact of the Act to our consolidated financial statements.

The current U.S.

Government shutdown could negatively impact our businesses.

Previous U.S.

Government shutdowns have resulted in delays in anticipated contract awards, issuances of export licenses, shipments and payments of invoices for several of our businesses, and the current shutdown could have similar or worse effects.

Sales recorded and costs incurred recorded by subsidiaries operating outside of the United States are translated into U.S.

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Results of Operations

Second Quarter % Six Months %

Third Quarter % Nine Months %

(dollars in millions) 2025 2024 Change 2025 2024 Change

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* Not meaningful

Second Quarter % Six Months %

Third Quarter % Nine Months %

(dollars in millions) 2025 2024 Change 2025 2024 Change

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Total operating income (loss) $ 282.8 $ 270.7 4.5 % $ 820.3 $ 752.0 9.1 %

(a) Net sales exclude inter-segment sales of $7.2 million and $11.0 million for the second quarter and six months of 2025, respectively, and $8.5 million and $13.3 million for the second quarter and six months of 2024, respectively.

Second Quarter Results

The following is a discussion of our 2025 second quarter results compared with the second quarter results of 2024.

(a) Net sales exclude inter-segment sales of $6.6 million and $17.5 million for the third quarter and nine months of 2025, respectively, and $5.9 million and $19.2 million for the third quarter and nine months of 2024, respectively.

Third Quarter Results

The following is a discussion of our 2025 third quarter results compared with the third quarter results of 2024.

Comparisons are with the corresponding reporting period of 2024 unless noted otherwise.

Second quarter of 2025 compared with the second quarter of 2024

Our second quarter of 2025 net sales increased 10.2%.

Net income attributable to Teledyne for the second quarter of 2025 increased 16.5%, driven primarily by higher net sales.

Net income per diluted share was $4.43 for the second quarter of 2025, compared with net income per diluted share of $3.77.

The second quarter of 2025 net sales compared with the second quarter of 2024 reflected higher net sales in each segment.

The second quarter of 2025 included $70.1 million in incremental sales from recent acquisitions, which are primarily included within the Aerospace and Defense Electronics segment.

Third quarter of 2025 compared with the third quarter of 2024

Our third quarter of 2025 net sales increased 6.7%, primarily due to sales from recent acquisitions in the Aerospace and Defense Electronics segment.

Net income attributable to Teledyne for the third quarter of 2025 decreased 15.8%, primarily driven by the favorable resolution of an uncertain tax position reached by the Company with foreign tax authorities around transfer pricing between certain FLIR subsidiaries in the third quarter of 2024.

Net income per diluted share was $4.65 for the third quarter of 2025, compared with net income per diluted share of $5.54.

The third quarter of 2025 net sales compared with the third quarter of 2024 reflected higher net sales in the Digital Imaging, Instrumentation and Aerospace and Defense Electronics segments, partially offset by lower net sales in the Engineered Systems segment.

The third quarter of 2025 included $69.0 million in incremental sales from recent acquisitions, which are included within the Aerospace and Defense Electronics segment.

Cost of Sales

Cost of sales increased $87.6 million in the second quarter of 2025, primarily driven by higher net sales.

Cost of sales as a percentage of net sales increased for the second quarter of 2025 to 57.4% from 56.9% primarily due to unfavorable product mix.

Cost of sales increased $56.1 million in the third quarter of 2025, primarily driven by higher net sales.

Cost of sales as a percentage of net sales increased slightly for the third quarter of 2025, to 57.2% from 57.1%.

Selling, General and Administrative Expense

Selling, general and administrative (“SG&A”) expense increased $4.6 million in the second quarter of 2025 primarily due to higher net sales.

SG&A expense as a percentage of net sales decreased to 15.2% for the second quarter of 2025 compared with 16.4%, with lower SG&A expense percentages primarily at the Digital Imaging and Instrumentation segments.

Corporate expense, which is included in SG&A expense, was $21.7 million for the second quarter of 2025 compared with $18.3 million, with the increase primarily related to higher transaction costs in the second quarter of 2025 for current year acquisitions.

Stock-based compensation expense was $11.3 million for the second quarter of 2025 compared with $9.3 million.

Selling, general and administrative (“SG&A”) expense increased $12.1 million in the third quarter of 2025 primarily due to higher net sales, including net sales related to 2025 acquisitions.

SG&A expense as a percentage of net sales decreased slightly, to 15.5% for the third quarter of 2025 compared with 15.7%.

Corporate expense, which is included in SG&A expense, was $22.0 million for the third quarter of 2025 compared with $18.7 million, with the increase primarily related to higher employee compensation costs, including severance costs.

Stock-based compensation expense was $10.5 million for the third quarter of 2025 compared with $8.7 million.

Research and Development Expense

R&D expense increased $10.7 million in the second quarter of 2025 primarily due to higher R&D expense at the Digital Imaging and Instrumentation segments.

R&D expense increased $10.4 million in the third quarter of 2025 primarily due to higher R&D expense in the Digital Imaging segment.

Acquired Intangible Asset Amortization

Acquired intangible asset amortization for the second quarter of 2025 was $54.6 million compared with $49.1 million, with the increase primarily related to 2025 acquisitions within the Aerospace and Defense Electronics segment.

Acquired intangible asset amortization for the third quarter of 2025 was $55.1 million compared with $49.8 million, with the increase primarily related to 2025 acquisitions within the Aerospace and Defense Electronics segment.

Pension Service Expense

Pension service expense is included in both cost of sales and SG&A expense.

For the second quarter of 2025 and 2024, pension service expense was $1.5 million.

For 2025, the weighted-average discount rate used to determine the benefit obligation for the domestic qualified pension plans is 7.05% compared with 6.86% in 2024.

For the third quarter of 2025 and 2024, pension service expense was $1.5 million.

Operating Income

Operating income for the second quarter of 2025 increased 12.6%.

The second quarter of 2025, compared with the second quarter of 2024, reflected higher operating income in each segment.

Operating income for the third quarter of 2025 increased 4.5%.

The third quarter of 2025, compared with the third quarter of 2024, reflected higher operating income in the Instrumentation and Aerospace and Defense Electronics segments, including incremental operating income related to 2025 acquisitions.

Non-operating Income and Expense

Interest and debt expense, net of interest income, was $17.6 million for the second quarter of 2025 compared with $15.8 million.

Non-service retirement benefit income was $2.7 million for both the second quarter of 2025 and 2024.

Other income and expense, net, was expense of $2.7 million for the second quarter of 2025 compared with expense of $2.2 million for the second quarter of 2024.

The Company also recorded a gain on debt extinguishment of $3.3 million for the second quarter of 2025 which is included in other income and expense, net, with no comparable amount recorded in the second quarter of 2024.

The second quarter of both the 2025 and 2024 income tax provision considers income, permanent items, tax credits and various statutory tax rates.

Second Quarter

Interest and debt expense, net of interest income, was $12.6 million for the third quarter of 2025 compared with $15.7 million.

Non-service retirement benefit income was $2.7 million for the third quarter of 2025 compared with $2.8 million.

Other income (expense), net, was income of $0.9 million for the third quarter of 2025 compared with expense of $2.7 million for the third quarter of 2024.

Other income (expense), net, primarily consisted of a $7.2 million gain on debt extinguishment, partially offset by foreign currency exchange losses in the third quarter of 2025.

Other income (expense), net, primarily consisted of foreign currency exchange losses in the third quarter of 2024.

The third quarter of both the 2025 and 2024 income tax provision considers income, permanent items, tax credits and various statutory tax rates.

Third Quarter

(dollars in millions) 2025 2024

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Effective tax rate 19.3% (2.8)%

(a) The second quarter of 2025 includes net discrete income tax benefits of $8.4 million and the second quarter of 2024 includes net discrete income tax benefits of $0.7 million.

First six months of 2025 compared with the first six months of 2024

The first six months of 2025 net sales increased 8.8%.

Net income for the first six months of 2025 increased 11.1%, driven primarily by higher net sales.

Net income per diluted share was $8.41 for the first six months of 2025, compared with net income per diluted share of $7.49.

The first six months of 2025 net sales, compared with the first six months of 2024, reflected higher net sales in each segment.

The first six months of 2025 included $125.7 million in incremental sales from recent acquisitions, which are primarily included within the Aerospace and Defense Electronics segment.

(a) The third quarter of 2025 includes net discrete income tax benefits of $4.9 million and the third quarter of 2024 includes net discrete income tax benefits of $62.3 million.

In July 2025, the “One Big Beautiful Bill Act” (the “Act”) was enacted into law.

The Act includes changes to U.S.

tax law, including provisions to accelerate tax deductions for qualified property and research expense.

The Company has estimated the 2025 impact in current results which includes a cash tax reduction of approximately $30.0 million.

The Company will continue to model the elective decisions before the 2025 tax return is filed in 2026.

The 2026 impact is estimated to include a cash tax reduction of between $60.0 million and $70.0 million.

First nine months of 2025 compared with the first nine months of 2024

The first nine months of 2025 net sales increased 8.0%.

Net income for the first nine months of 2025 decreased 0.2%, primarily driven by the favorable resolution of an uncertain tax position reached by the Company with foreign tax authorities around transfer pricing between certain FLIR subsidiaries in the third quarter of 2024.

Net income per diluted share was $13.06 for the first nine months of 2025, compared with net income per diluted share of $13.01.

The first nine months of 2025 net sales, compared with the first nine months of 2024, reflected higher net sales in each segment.

The first nine months of 2025 included $196.3 million in incremental sales from recent acquisitions, which are primarily included within the Aerospace and Defense Electronics segment.

Cost of Sales

Cost of sales increased $147.8 million in the first six months of 2025, primarily driven by higher net sales.

Cost of sales as a percentage of net sales increased for the first six months of 2025 to 57.3% from 57.0%.

Cost of sales increased $203.9 million in the first nine months of 2025, primarily driven by higher net sales.

Cost of sales as a percentage of net sales increased for the first nine months of 2025 to 57.3% from 57.0%.

Selling, General and Administrative Expense

SG&A expense increased $18.8 million in the first six months of 2025 primarily due to higher net sales.

SG&A expense as a percentage of net sales for the first six months of 2025 was 15.6% compared with 16.3%.

Corporate expense, which is included in SG&A expense, was $43.9 million for the first six months of 2025 compared with $38.4 million, with the increase primarily related to higher transaction costs in the first six months of 2025 for current year acquisitions.

Stock-based compensation expense was $20.2 million for the first six months of 2025 compared with $21.3 million.

SG&A expense increased $30.9 million in the first nine months of 2025 primarily due to higher net sales, including net sales related to 2025 acquisitions.

SG&A expense as a percentage of net sales for the first nine months of 2025 was 15.6% compared with 16.1%.

Corporate expense, which is included in SG&A expense, was $65.9 million for the first nine months of 2025 compared with $57.1 million, with the increase primarily related to higher employee compensation costs, including severance costs and higher transaction costs in the first nine months of 2025 for current year acquisitions.

Stock-based compensation expense was $30.7 million for the first nine months of 2025 compared with $30.0 million.

Research and Development Expense

R&D expense increased $8.5 million in the first six months of 2025 primarily due to higher R&D expense within the Instrumentation and Aerospace and Defense Electronics segments.

R&D expense increased $18.9 million in the first nine months of 2025 due to higher R&D expense within the Digital Imaging, Instrumentation and Aerospace and Defense Electronics segments.

Acquired Intangible Asset Amortization

Acquired intangible asset amortization for the first six months of 2025 was $106.6 million compared with $98.5 million, with the increase primarily related to 2025 acquisitions within the Aerospace and Defense Electronics segment.

Acquired intangible asset amortization for the first nine months of 2025 was $161.7 million compared with $148.3 million, with the increase primarily related to 2025 acquisitions within the Aerospace and Defense Electronics segment.

Pension Service Expense

Pension service expense is included in both cost of sales and SG&A expense.

For both the first six months of 2025 and 2024, pension service expense was $3.0 million.

For 2025, the weighted-average discount rate used to determine the benefit obligation for the domestic qualified pension plans is 7.05% compared with 6.86% in 2024.

For both the first nine months of 2025 and 2024, pension service expense was $4.5 million.

Operating Income

Operating income for the first six months of 2025 increased 11.7%.

The first six months of 2025, compared with the first six months of 2024, reflected higher operating income in each segment.

Operating income for the first nine months of 2025 increased 9.1%.

The first nine months of 2025, compared with the first nine months of 2024, reflected higher operating income in each segment, including incremental operating income related to 2025 acquisitions

Non-operating Income and Expense

Interest and debt expense, net of interest income, was $34.9 million for the first six months of 2025, compared with $28.5 million, with the increase related to higher outstanding borrowings on our line of credit during the period as compared to the first six months of 2024.

Non-service retirement benefit income was $5.5 million for the first six months of 2025 compared with $5.4 million for the first six months of 2024.

Other income and expense, net was expense of $8.6 million for the first six months of 2025 compared with expense of $1.0 million for the first six months of 2024, with the amounts primarily related to foreign currency exchange losses in both periods.

The Company also recorded a gain on debt extinguishment of $3.3 million for the first six months of 2025 which is included in other income and expense, net, with no comparable amount recorded in the first six months of 2024.

The first six months of both the 2025 and 2024 income tax provision considers income, permanent items, tax credits and various statutory tax rates.

In both 2025 and 2024, the first six months discrete impact is primarily related to tax on stock-based compensation.

Interest and debt expense, net of interest income, was $47.5 million for the first nine months of 2025, compared with $44.2 million, with the increase related to higher outstanding borrowings on our line of credit during the period as compared to the first nine months of 2024.

Non-service retirement benefit income was $8.2 million for the first nine months of 2025 and 2024.

Other income and expense, net was expense of $7.7 million for the first nine months of 2025 compared with expense of $3.7 million for the first nine months of 2024.

The Other income and expense, net expense of $7.7 million for the first nine months of 2025 included a $10.5 million gain on debt extinguishment, partially offset by foreign currency exchange losses.

Other income and expense, net expense of $3.7 million for the first nine months of 2024 primarily related to foreign currency exchange losses.

The first nine months of both the 2025 and 2024 income tax provision considers income, permanent items, tax credits and various statutory tax rates.

In both 2025 and 2024, the first nine months discrete impact is primarily related to tax on stock-based compensation.

(dollars in millions) 2025 2024

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Effective tax rate 19.8% 12.7%

(a) The first six months of 2025 includes net discrete income tax benefits of $12.1 million and the first six months of 2024 includes net discrete income tax benefits of $5.1 million, respectively.

(a) The first nine months of 2025 includes net discrete income tax benefits of $17.0 million and the first nine months of 2024 includes net discrete income tax benefits of $67.4 million, respectively.

In July 2025, the “One Big Beautiful Bill Act” (the “Act”) was enacted into law.

The Act includes changes to U.S.

tax law, including provisions to accelerate tax deductions for qualified property and research expense.

The Company has estimated the 2025 impact in current results which includes a cash tax reduction of approximately $30.0 million.

The Company will continue to model the elective decisions before the 2025 tax return is filed in 2026.

The 2026 impact is estimated to include a cash tax reduction of between $60.0 million and $70.0 million.

Segment Results

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Digital Imaging

Second Quarter Change Six Months Change

Third Quarter Change Nine Months Change

(dollars in millions) 2025 2024 $ % 2025 2024 $ %

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Operating income 15.7 % 16.1 % 15.8 % 15.6 %

Second quarter of 2025 compared with the second quarter of 2024

Net sales increased primarily due to higher sales of unmanned air systems and commercial infrared imaging components, partially offset by lower sales of X-ray and geospatial products.

Sales of unmanned air systems increased $20.6 million, sales of commercial infrared imaging components increased $16.1 million, sales of X-ray products decreased $4.0 million and sales of geospatial products decreased $3.7 million.

The second quarter of 2025 included $5.8 million in incremental sales from a recent acquisition.

Cost of sales increased primarily due to product mix.

As a result of unfavorable product mix, the cost of sales percentage increased during the period.

The SG&A expense decrease included the reduction of a contingent liability resulting from a change in estimate, partially offset by higher severance and facility consolidation costs.

As a result, SG&A expense as a percentage of net sales decreased during the quarter.

R&D expense and R&D expense as a percentage of net sales increased primarily due to the timing of FLIR product development activities.

Third quarter of 2025 compared with the third quarter of 2024

Net sales increased primarily due to higher sales of commercial infrared imaging components and subsystems, unmanned air systems, and industrial automation imaging systems, partially offset by lower sales of unmanned ground systems.

Sales of commercial infrared imaging components and subsystems increased $11.7 million, sales of unmanned air systems increased $7.5 million, sales of industrial automation imaging systems increased $5.0 million, and sales of unmanned ground systems decreased $7.2 million.

Cost of sales increased primarily due to higher net sales.

The cost of sales percentage decreased slightly during the period.

SG&A expense increased slightly, and SG&A expense as a percentage of net sales decreased slightly.

R&D expense and R&D expense as a percentage of net sales increased primarily due to the timing of FLIR product development activities, including higher R&D expense for unmanned air systems.

Acquired intangible asset amortization and acquired intangible asset amortization as a percentage of net sales remained reasonably consistent between the two periods.

Operating income increased primarily due to higher net sales and lower SG&A, offset by unfavorable product mix and higher R&D expense during the period, and operating income as a percentage of net sales increased slightly.

First six months of 2025 compared with the first six months of 2024

Net sales increased primarily due to higher sales of commercial infrared imaging components, unmanned air systems and surveillance systems, partially offset by lower sales of X-ray products, industrial automation imaging systems and commercial infrared imaging systems.

Sales of commercial infrared imaging components increased by $30.0 million, sales of unmanned air systems increased by $23.1 million, sales of surveillance systems increased by $16.2 million, sales of X-ray products decreased by $10.9 million, sales of industrial automation imaging systems decreased by $9.4 million and sales of commercial infrared imaging systems decreased by $8.7 million.

The first six months of 2025 also included $14.7 million in incremental sales from recent acquisitions.

Cost of sales increased primarily due to unfavorable product mix.

As a result of unfavorable product mix, the cost of sales percentage increased during the period.

Operating income decreased primarily due to higher R&D expense, partially offset by higher net sales.

As a result of the higher R&D expenses, operating income as a percentage of net sales decreased.

First nine months of 2025 compared with the first nine months of 2024

Net sales increased primarily due to higher sales of commercial infrared imaging components, unmanned air systems and surveillance systems, partially offset by lower sales of commercial infrared imaging systems, X-ray products, geospatial products and industrial automation imaging systems.

Sales of commercial infrared imaging components and subsystems increased by $41.7 million, sales of unmanned air systems increased by $29.7 million, sales of surveillance systems increased by $19.7 million, sales of commercial infrared imaging systems decreased by $17.6 million, sales of X-ray products decreased by $11.8 million, sales of geospatial products decreased by $5.4 million, and sales of industrial automation imaging systems decreased by $4.4 million.

The first nine months of 2025 also included $15.1 million in incremental sales from recent acquisitions.

Cost of sales increased primarily due to unfavorable product mix, and the cost of sales percentage increased during the period.

The SG&A expense decrease included the reduction of a contingent liability resulting from a change in estimate, partially offset by higher severance and facility consolidation costs.

As a result, SG&A expense as a percentage of net sales decreased during the first six months of 2025.

R&D expense and R&D expense as a percentage of net sales were reasonably consistent between the two periods.

Acquired intangible asset amortization and acquired intangible asset amortization as a percentage of net sales remained reasonably consistent between the two periods.

As a result, SG&A expense as a percentage of net sales decreased during the first nine months of 2025.

R&D expense and R&D expense as a percentage of net sales increased primarily due to the timing of FLIR product development activities.

Acquired intangible asset amortization increased slightly while acquired intangible asset amortization as a percentage of net sales remained reasonably consistent between the two periods.

Operating income increased primarily due to higher net sales and lower SG&A, partially offset by unfavorable product mix during the period.

As a result, operating income as a percentage of net sales increased during the period.

As a result, operating income as a percentage of net sales increased slightly during the period.

Instrumentation

Second Quarter Change Six Months Change

Third Quarter Change Nine Months Change

(dollars in millions) 2025 2024 $ % 2025 2024 $ %

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Operating income 27.2 % 27.5 % 27.3 % 26.6 %

Second quarter of 2025 compared with the second quarter of 2024

Third quarter of 2025 compared with the third quarter of 2024

Net sales increased due to higher sales in each product line.

Sales of Marine Instrumentation increased $23.7 million due to stronger offshore energy and defense markets.

Sales of Environmental Instrumentation increased $6.4 million and sales of Test and Measurement Instrumentation increased $4.0 million.

Sales of Environmental Instrumentation increased $8.1 million primarily due to stronger sales of gas detection products.

Sales of Marine Instrumentation increased $5.3 million due to stronger offshore energy and defense markets and sales of Test and Measurement Instrumentation increased $0.4 million.

Cost of sales increased primarily due to higher net sales.

The cost of sales percentage decreased slightly.

SG&A expense was consistent between the two periods, and SG&A expense as a percentage of net sales decreased primarily due to maintaining cost control measures year-over-year.

R&D expense increased due to higher Marine Instrumentation product development, and the R&D expense as a percentage of net sales increased slightly.

Operating income increased primarily due to higher Marine Instrumentation sales and favorable product mix, and operating income as a percentage of net sales increased primarily due to favorable product mix.

For six months of 2025 compared with the first six months of 2024

The cost of sales percentage increased slightly.

SG&A expense increased slightly, and SG&A expense as a percentage of net sales increased slightly.

R&D expense increased due to higher Marine Instrumentation product development, and R&D expense as a percentage of net sales was consistent between the two periods.

Operating income increased primarily due to higher Environmental Instrumentation sales and operating income as a percentage of net sales decreased primarily due to unfavorable product mix.

For nine months of 2025 compared with the first nine months of 2024

Net sales increased due to higher sales in each product line.

Sales of Marine Instrumentation increased $43.0 million due to stronger offshore energy and defense markets.

Sales of Test and Measurement Instrumentation increased $5.1 million, and sales of Environmental Instrumentation increased $4.2 million.

The first six months of 2025 included $4.3 million in incremental sales from recent acquisitions.

Sales of Environmental Instrumentation increased $12.3 million primarily due to stronger sales of gas detection products and sales of Test and Measurement Instrumentation increased $5.5 million.

The first nine months of 2025 included $5.5 million in incremental sales from recent acquisitions.

Cost of sales increased primarily due to higher net sales, partially offset by favorable product mix.

1 unchanged sentence

SG&A expense increased primarily due to higher net sales, and SG&A expense as a percentage of net sales decreased primarily due to maintaining cost control measures year-over-year.

R&D expense increased due to higher Marine Instrumentation product development, and the R&D expense as a percentage of net sales increased slightly.

R&D expense increased due to higher Marine Instrumentation product development, and R&D expense as a percentage of net sales increased slightly.

Operating income increased primarily due to higher net sales and favorable product mix.

1 unchanged sentence

Aerospace and Defense Electronics

Second Quarter Change Six Months Change

Third Quarter Change Nine Months Change

(dollars in millions) 2025 2024 $ % 2025 2024 $ %

16 unchanged sentences

* Not meaningful

Second quarter of 2025 compared with the second quarter of 2024

Third quarter of 2025 compared with the third quarter of 2024

Net sales increased due to a $75.6 million increase in defense electronics, partially offset by a $0.3 million decrease in aerospace electronics.

The second quarter of 2025 included $64.3 million in incremental sales from recent acquisitions.

The third quarter of 2025 included $69.0 million in incremental sales from recent acquisitions.

Cost of sales increased due to higher net sales, inventory step-up expense related to the 2025 acquisitions and unfavorable product mix, including recent acquisitions, which carry a higher cost of sales percentage, and as a result, the cost of sales percentage increased.

SG&A expense increased due to higher net sales and higher transaction and integration costs as a result of 2025 acquisitions.

R&D expense increased primarily due to the 2025 acquisitions, and the R&D expense as a percentage of net sales was similar in both periods.

R&D expense increased primarily due to the 2025 acquisitions, and R&D expense as a percentage of net sales decreased.

Acquired intangible asset amortization increased primarily due to the 2025 acquisitions.

Operating income increased primarily due to increased net sales, and operating income as a percent of net sales decreased primarily due to unfavorable product mix including lower gross margins on sales from 2025 acquisitions as well as higher acquired intangible asset amortization.

First six months of 2025 compared with the first six months of 2024

Operating income increased primarily due to increased net sales, and operating income as a percentage of net sales decreased primarily due to unfavorable product mix, including lower gross margins on sales from 2025 acquisitions as well as higher acquired intangible asset amortization.

First nine months of 2025 compared with the first nine months of 2024

Net sales increased due to a $205.3 million increase for defense electronics, partially offset by a $2.8 million decrease for aerospace electronics.

The first six months of 2025 included $106.7 million in incremental sales from recent acquisitions.

The first nine months of 2025 included $175.7 million in incremental sales from recent acquisitions.

2 unchanged sentences

Acquired intangible asset amortization increased primarily due to the 2025 acquisitions.

Operating income increased primarily due to increased net sales, and operating income as a percent of net sales decreased primarily due to higher transaction and integration costs, higher acquired intangible asset amortization and unfavorable product mix including lower gross margins on sales from 2025 acquisitions.

Operating income increased primarily due to increased net sales, and operating income as a percentage of net sales decreased primarily due to higher transaction and integration costs, higher acquired intangible asset amortization and unfavorable product mix including lower gross margins on sales from 2025 acquisitions.

Engineered Systems

Second Quarter Change Six Months Change

Third Quarter Change Nine Months Change

(dollars in millions) 2025 2024 $ % 2025 2024 $ %

13 unchanged sentences

Operating income 10.6 % 10.3 % 10.6 % 7.1 %

Second quarter of 2025 compared with the second quarter of 2024

Net sales increased due to higher sales of $4.0 million for engineered products, partially offset by a $0.5 million decrease in energy systems.

Third quarter of 2025 compared with the third quarter of 2024

Net sales decreased due to lower sales of $9.2 million for engineered products and lower sales of $0.9 million for energy systems.

Cost of sales and cost of sales as a percentage decreased primarily due to favorable program mix.

SG&A expense and SG&A expense as a percentage of net sales decreased slightly.

Operating income and operating income as a percentage of net sales increased primarily due to higher net sales and favorable program mix.

First six months of 2025 compared with the first six months of 2024

SG&A expense and SG&A expense as a percentage of net sales increased due to higher employee compensation costs.

Operating income decreased primarily due to lower net sales, partially offset by favorable program mix, and operating income as a percentage of net sales increased due to favorable program mix.

First nine months of 2025 compared with the first nine months of 2024

Net sales increased due to higher sales of $9.0 million for engineered products, partially offset by a $1.7 million decrease in energy systems.

Cost of sales increased primarily due to higher net sales, partially offset by favorable program mix and cost of sales as a percentage decreased primarily due to favorable program mix.

SG&A expense decreased primarily due to lower selling expense and SG&A expense as a percentage of net sales decreased.

Cost of sales decreased primarily due to favorable program mix, partially offset by higher net sales and cost of sales as a percentage of net sales decreased primarily due to favorable program mix.

SG&A expense decreased primarily due to lower bid and proposal expense and SG&A expense as a percentage of net sales decreased.

Operating income and operating income as a percentage of net sales increased primarily due to higher net sales and favorable program mix.

11 unchanged sentences

Cash and Cash Equivalents

Cash and cash equivalents totaled $310.9 million at June 29, 2025, compared with $649.8 million at December 29, 2024, with the decrease primarily related to funding the 2025 acquisitions, partially offset by cash generated from operating activities.

Cash and cash equivalents totaled $528.6 million at September 28, 2025, compared with $649.8 million at December 29, 2024, with the decrease primarily related to funding the 2025 acquisitions, partially offset by cash generated from operating activities.

Cash equivalents consist of highly liquid money-market mutual funds, with maturities of three months or less when purchased.

Long-term Debt

Total debt, net of unamortized debt discount and debt issuance costs at June 29, 2025, was $2,617.4 million compared with $2,649.0 million at December 29, 2024, with the decrease due to payments on fixed rate senior notes.

At June 29, 2025, $1,168.0 million was available under the $1.20 billion credit facility, after reductions of $32.0 million in outstanding letters of credit.

Total debt, net of unamortized debt discount and debt issuance costs at September 28, 2025, was $2,533.4 million compared with $2,649.0 million at December 29, 2024, with the decrease due to payments on fixed rate senior notes.

At September 28, 2025, $1,168.7 million was available under the $1.2 billion credit facility, after reductions of $31.3 million in outstanding letters of credit.

Our bank credit agreements, which includes our $1.2 billion credit facility expiring June 2029, require us to comply with various financial and operating covenants.

At June 29, 2025, we were in compliance with these covenants.

At September 28, 2025, we were in compliance with these covenants.

Our liquidity is not dependent upon the use of off-balance sheet financial arrangements.

11 unchanged sentences

We currently intend to fund future share repurchases, if any, with cash on hand and available borrowings under our credit facility.

No repurchases under any authorizations were made in the second quarter and first six months of 2025.

Net cash provided by operating activities was $469.2 million for the first six months of 2025 compared with $609.7 million, with the decrease driven primarily by higher income tax payments in 2025 as well as the timing of accounts receivable collections.

Net cash used in investing activities was $805.2 million for the first six months of 2025 compared with $157.1 million.

During the first six months of 2025, we spent $757.6 million on acquisitions compared with $123.6 million.

Capital expenditures for the first six months of 2025 and 2024 were $48.3 million and $33.6 million, respectively.

No repurchases under any authorizations were made in the third quarter and first nine months of 2025.

Net cash provided by operating activities was $812.3 million for the first nine months of 2025 compared with $859.5 million, with the decrease primarily driven by higher income tax payments in 2025 as well as the timing of accounts receivable collections.

Net cash used in investing activities was $840.9 million for the first nine months of 2025 compared with $178.2 million.

During the first nine months of 2025, we spent $764.2 million on acquisitions compared with $123.7 million.

Capital expenditures for the first nine months of 2025 and 2024 were $77.5 million and $54.7 million, respectively.

We currently plan to invest approximately $130 million for capital expenditures in 2025.

Net cash used in financing activities was $4.8 million for the first six months of 2025 compared with net cash used in financing activities of $637.9 million.

Net cash used in financing activities was $93.5 million for the first nine months of 2025 compared with net cash used in financing activities of $772.4 million.

The first nine months of 2025 included the repurchase and retirement of $118.2 million in principal of our fixed rate senior notes for $107.7 million in cash.

The first nine months of 2024 included a $450 million debt maturity payment on our Senior Notes due April 2024 and share repurchases of $332.6 million.

Critical Accounting Policies and Estimates

13 unchanged sentences

Presidential Administration, especially with respect to new and higher tariffs, cutbacks in the funding of government agencies and programs, and the scaling back of environmental and green energy policies;

escalating economic and diplomatic tension between China and the United States, including a potential “trade war” that results in higher tariffs and restrictions on sales of goods and services;

escalating economic and diplomatic tension between China and the United States, including a “trade war” resulting in higher tariffs and restrictions on sales of goods and services;

reciprocal tariffs from other countries, especially from members of the European Union;

Government shutdowns, which in the past have resulted in delays in anticipated contract awards, delayed payments of invoices and delays in the issuance of export and other licenses;

the inability to develop and market new competitive products;

changes in relevant tax and other laws;

5 unchanged sentences

labor shortages and competition for skilled personnel;

the inability to develop and market new competitive products;

inherent uncertainties involved in the estimates and judgments used in the preparation of financial statements and the providing of estimates of financial measures, in accordance with GAAP and related standards;

31 unchanged sentences

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 1. Financial Statements