What changed in this filing

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Item 1. Business

2025-02-26 compared with 2024-02-28 · 45 added, 57 removed, 203 unchanged (33% of the section changed)

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and its subsidiaries or any of them, unless the context requires otherwise.

Interface is a global flooring company specializing in carbon neutral carpet tile and resilient flooring, including luxury vinyl tile (“LVT”), and nora® rubber flooring.

Interface is a global flooring solutions company and sustainability leader, offering an integrated portfolio of carpet tile and resilient flooring products that includes Interface® carpet tile and luxury vinyl tile (“LVT”), nora® rubber flooring, and FLOR® premium area rugs for commercial and residential spaces.

We help our customers create high-performance interior spaces that support well-being, productivity, and creativity, as well as sustainability of the planet.

As a global company with a reputation for high quality, reliability and premium positioning, we market modular carpet under the established brand names Interface® and FLOR® , and we market LVT under the brand Interface®.

In 2018, the Company acquired nora Holding GmbH (“nora”), a worldwide leader in the rubber flooring category under the established nora brands noraplan ® and norament ®.

As a global company with a reputation for high quality, reliability and premium positioning, we market modular carpet under the established brand names Interface® and FLOR® , we market LVT under the brand Interface®, and we market rubber flooring under the brands noraplan ® and norament ®.

Reportable Segments

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Market Segmentation

Our business, as well as the commercial interiors industry in general, is cyclical in nature and is impacted by economic conditions and trends that affect the markets for commercial and institutional business space.

We believe the appeal and utilization of modular carpet and resilient flooring will continue to grow in corporate office and non-corporate office market segments, and we are using our considerable skills and experience with designing, producing and marketing modular products that make us a market leader in the corporate office market segment to support and facilitate our penetration into more non-corporate office market segments around the world.

During fiscal year 2023, the continued disruption in our economic markets due to ongoing inflation, increases in interest rates, the Russia-Ukraine war, and the onset of the Israel-Hamas war, a fairly stabilized but challenging supply chain environment, a slow post COVID recovery in China and slow market conditions in the rest of Asia, and significant financial pressures in the commercial office market globally, all posed challenges for us.

Below is a summary of our sales mix between corporate office and non-corporate office market segments for the last three fiscal years by reportable segment:

2023 2022 2021

Corporate Office Non-Corporate Office Corporate Office Non-Corporate Office Corporate Office Non-Corporate Office

AMS 40% 60% 38% 62% 39% 61%

EAAA 61% 39% 61% 39% 57% 43%

We believe the appeal and utilization of our products will continue to grow, and we are using our considerable skills and experience with designing, producing and marketing our products to make us a market leader.

We primarily focus our sales efforts on the corporate office, education, healthcare, government, hospitality, and residential living market segments.

Disruptions in economic markets due to inflation, high interest rates, geo-political tensions, including the Russia-Ukraine war and the Middle East conflict, a still challenging supply chain environment, slow economic conditions in several markets that we serve, and significant financial pressures in the commercial office market globally, all pose challenges for us and impact the markets we operate in.

Products and Services

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We produce carpet tiles in a wide variety of colors, patterns, textures, pile heights and densities.

These varieties are designed to meet both the practical and aesthetic needs of a broad spectrum of commercial interiors — particularly offices, healthcare facilities, airports, educational and other institutions, hospitality spaces, retail facilities — and residential interiors.

These varieties are designed to meet both the practical and aesthetic needs of a broad spectrum of commercial interiors — particularly offices, educational facilities, healthcare facilities, government-related facilities (including but not limited to airports), hospitality spaces, retail facilities, and residential interiors.

Our carpet tile systems permit distinctive styling and patterning that can be used to complement interior designs, to set off areas for particular purposes and create visual cues.

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Our GlasBac® technology employs a fiberglass-reinforced polymeric composite backing that provides dimensional stability and reduces the need for adhesives or fasteners.

We also make carpet tiles with a backing containing post-industrial and/or post-consumer recycled materials, which we now market under the CQuest™GB name (formerly known as GlasBacRE ).

We also make carpet tiles with a backing containing post-industrial and/or post-consumer recycled materials.

In addition, we make carpet tile with yarn containing varying degrees of recycled post-consumer nylon, depending on the style and color.

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Innovations in both design and manufacturing allow us to create these high-quality, high-performance carpet products at a lower price point.

Launched in 2020, our next generation of carpet tile backings are called CQuest™ backings.

Launched in 2020, our next generation carpet tile backings are called CQuest™ backings.

Guided by materials science and inspired by nature’s carbon-storing abilities, we added new bio-based materials and more recycled content to our backings.

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The CQuest backings are:

• CQuest™GB – The next evolution of our GlasBacRE backing.

It features the same superior performance with a construction of post-consumer recycled content from carpet tiles, bio-based additives, and pre-consumer recycled materials.

• CQuest™GB – Which features superior performance with a construction of post-consumer recycled content from carpet tiles, bio-based additives, and pre-consumer recycled materials.

• CQuest™Bio – A non-vinyl bio-composite backing made with bio-based and recycled fillers.

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Our TacTiles® carpet tile installation system uses small squares of adhesive plastic film to connect intersecting carpet tiles, thus eliminating the need for traditional carpet adhesive and resulting in a reduction in installation time and material waste.

We also produce and sell a specially adapted version of our carpet tile for the healthcare facilities market.

Our carpet tile possesses characteristics — such as the use of the Intersept® antimicrobial, static-controlling nylon yarns, and thermally pigmented, colorfast yarns — which make it suitable for use in these facilities in place of hard surface flooring.

Moreover, we sell our FLOR line of products to specifically target modular carpet sales to the residential market segment, and in recent years FLOR products have had crossover success in commercial markets.

In addition, we have created modular carpet products specifically designed for each of the education, hospitality and retail market segments.

We also sell our FLOR line of products to specifically target modular carpet sales to the residential market segment, and in recent years FLOR products have had crossover success in commercial markets.

In addition, we have created modular carpet products designed for each of the education, healthcare, hospitality and retail market segments.

The award-winning design firm David Oakey Designs has had a pivotal role in developing many of our innovative product designs.

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In 2020, we achieved a substantial milestone in our journey toward becoming a sustainable enterprise.

Simultaneously with the launch of our new CQuest backings described above, we introduced in the Americas and subsequently in our EAAA geographical regions, our first ever “cradle-to-gate” carbon negative carpet tile products in three unique styles:

Simultaneously with the launch of our CQuest backings described above, we introduced in the Americas and subsequently in our EAAA geographical regions, our first ever “cradle-to-gate” carbon negative carpet tile products in three unique styles:

Shishu Stitch ™, Tokyo Texture ™, and Zen Stitch ™.

These pioneering products, which are part of our Embodied Beauty ™ collection, are created with a combination of our new CQuestBioX carpet backing (featuring new bio-based materials and more recycled content), specialty yarns and tufting processes that create a carpet tile with a net negative value of “embodied carbon”.

These pioneering products, which are part of our Embodied Beauty ™ collection, are created with a combination of our CQuestBioX carpet backing (featuring bio-based materials and more recycled content), specialty yarns and tufting processes that create a carpet tile with a net negative value of “embodied carbon”.

Embodied carbon is the carbon footprint (meaning the global warming potential of emissions of greenhouse gases measured in carbon dioxide equivalents) of a product from raw material creation, growth and extraction (the “cradle”) through processing until it is packaged and ready to be shipped from our factory (the “gate”), thus referred to as “cradle-to-gate” in the life cycle assessment of a product.

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Other Products and Services

We sell a proprietary antimicrobial chemical compound under the registered trademark Intersept that we incorporate in some of our modular carpet products.

We also sell our TacTiles carpet tile installation system, along with a variety of traditional adhesives and products for carpet installation and maintenance that are manufactured by a third party.

We sell our TacTiles carpet tile installation system, along with a variety of traditional adhesives and products for carpet installation and maintenance that are manufactured by a third party.

We also continue to provide “turnkey” project management services for a number of global accounts and other large customers through our InterfaceSERVICES™ business.

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We manufacture carpet tile at two locations in the United States and at facilities in the Netherlands, the United Kingdom, China and Australia.

We also manufactured carpet tile at a location in Thailand for many years, but in 2021 we announced the closure of the Thailand plant, in which manufacturing was permanently halted at the end of the first quarter of 2022.

The Thailand real estate was sold in 2023.

We manufacture rubber flooring in Germany.

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In order to implement our global marketing efforts, we have product showrooms or design studios in the United States, England, France, Germany, Spain, the Netherlands, India, Australia, United Arab Emirates, Singapore, Hong Kong, China and elsewhere.

We may open offices in other locations around the world as necessary to capitalize on emerging marketing opportunities.

We may open offices in other locations around the world as necessary to capitalize on opportunities.

Business Strategy and Principal Initiatives

Our business strategy is to continue to use our leading position in modular carpet, product design and global made-to-order capabilities as a platform from which to position our modular carpet, LVT products, rubber flooring, and other resilient products across several industry segments.

We will seek to increase revenues and profitability by pursuing the following key initiatives:

Continue to Penetrate Non-Corporate Office Market Segments.

We plan to continue our strategic focus on product design and marketing and sales efforts for non-corporate office market segments such as government, education, healthcare, hospitality, and residential living.

We began this initiative as part of a market diversification strategy to reduce our exposure to the economic cyclicality of the corporate office market segment, and it has become a principal strategy generally for growing our business and enhancing profitability.

Recently, we also launched our One Interface strategy which is a multi-year effort focused on:

• Building strong global functions like Marketing, IT, Human Resources, and Finance to support our world-class local selling teams.

• Accelerating growth through enhanced productivity of our commercial team.

• Expanding margins through global supply chain management and simplifying operations.

• Leading in design, innovation, and sustainability.

Through these strategies, we will seek to increase revenues and profitability by pursuing the following key initiatives:

Continue to Penetrate Diversified Market Segments.

We plan to continue our strategic focus on product design and marketing and sales efforts in the corporate office, government, education, healthcare, hospitality, and residential living market segments.

This initiative is part of a market diversification strategy to reduce our exposure to the economic cyclicality of the corporate office market segment, and it has become a principal strategy generally for growing our business and enhancing profitability.

Develop a Substantial Resilient Flooring Business .

Building upon the success of our products in the high growth LVT market, we plan to expand our LVT product offerings while also seeking to introduce new products in the resilient flooring category.

Building upon the success of our products in the LVT market, we plan to expand our LVT product offerings while also seeking to introduce new products in the resilient flooring category.

We believe our ability to offer and sell our soft and hard surfaces in an integrated flooring design helps meet the needs of our customers by complementing and enhancing our carpet tile portfolio with true modular installation, no transition strips between surfaces, carpet tile and resilient products that are in some cases the same size and shape, and favorable acoustic properties.

Our nora business, with its rubber flooring products, is also a key component of our strategy in this area.

Sustain Leadership in Product Design and Development.

Our CQuest backings, Embodied Beauty collection, and our plank, Skinny Plank , and i2 products and TacTiles installation system have confirmed our position as an innovation leader in modular carpet.

We will continue initiatives to sustain, augment and capitalize upon that strength to continue to increase our market share in targeted market segments.

Our Climate Take Back initiative, which was advanced in 2020 with the launch of our first ever cradle-to-gate carbon negative carpet tile, promotes our commitment to the pursuit of sustainability.

As we execute on our strategy to penetrate non-corporate office market segments, sales in the education market segment have increased, in recent years, particularly in the second and third quarters as schools undertake renovation projects during the summer months when schools are typically closed.

We compete, on a global basis, in the sale of our modular carpet products with other carpet manufacturers and manufacturers of vinyl and other types of floorcoverings, including broadloom carpet.

Our nora products are a key component of our strategy in this area.

Sustain Leadership in Product Design, Product Development, and Sustainability.

Our CQuest backings, Embodied Beauty collection, and our plank, Skinny Plank , and i2 products and TacTiles installation system have confirmed our position as an innovation leader in modular flooring.

We plan to continue to pursue initiatives to sustain, augment and capitalize upon that strength to continue to increase our market share in targeted market segments.

We also plan to continue to focus on carbon reductions in our products and operations as we work toward achieving our science-based targets by 2030 and as we work toward our goal of becoming a carbon negative enterprise by 2040.

As we have executed on our strategy, sales in the education market segment have increased, in recent years, particularly in the second and third quarters as schools often schedule renovation projects during the summer months when schools are typically closed.

We compete, on a global basis, in the sale of our modular carpet products with other carpet manufacturers and manufacturers of vinyl and other types of floorcoverings.

Although the industry has experienced significant consolidation, a large number of manufacturers remain in the industry.

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We believe the principal competitive factors in our primary floorcovering markets are brand recognition, quality, design, service, broad product lines, product performance, marketing strategy, pricing and sustainability.

In the corporate office market segment, modular carpet competes with various floorcoverings including broadloom carpet, LVT and polished concrete.

We believe the quality, service, design, better and longer average product performance, flexibility (such as design options, selective rotation or replacement, and use in combination with our resilient products), environmental footprint and convenience of our modular carpet are our principal competitive advantages.

We compete against various floorcoverings including carpet tile, broadloom carpet, LVT and other hard surface flooring, and polished concrete.

We believe the quality, service, design, better product performance, flexibility (such as design options, selective rotation or replacement, and use in combination with our resilient products), environmental footprint and convenience of our flooring products are our principal competitive advantages.

We believe we have competitive advantages in several other areas as well.

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Additionally, we believe that our global carpet tile manufacturing capabilities are an important competitive advantage in serving the needs of multinational corporate customers.

We believe that the incorporation of the Intersept antimicrobial chemical agent into the backing of some modular carpet products enhances our ability to compete successfully across some of our market segments.

Our sustainability goals are a brand-enhancing, competitive strength as well as a strategic initiative.

Our customers are increasingly concerned about the environmental and broader ecological implications of their operations and the products they use in them.

Many of our customers are concerned about the environmental and broader ecological implications of their operations and the products they use in them.

Our leadership, knowledge and expertise in the area, especially in the “green building” movement and related environmental certification programs, resonate deeply with many of our customers and prospects around the globe.

Our modular carpet products historically have had inherent installation and maintenance advantages that have translated into greater efficiency and waste reduction.

We are using raw materials and production technologies, such as our ReEntry 2.0 reclaimed carpet separation process and our new CQuest backings, that directly reduce the adverse impact of those operations on the environment and limit our dependence on petrochemicals.

We are using raw materials and production technologies, such as our ReEntry 2.0 reclaimed carpet separation process and our CQuest backings, that directly reduce adverse impacts of those operations on the environment and limit our dependence on petrochemicals.

Product Design, Research and Development

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Innovation and increased customization in product design and styling are the principal focus of our product development efforts, and this focus has led to several design breakthroughs such as our CQuest backings, plank and Skinny Plank products, as well as our i2 product line.

Our carpet design and development team is recognized as an industry leader in carpet design and product engineering for the commercial and institutional markets.

Our design and development team is recognized as an industry leader in design and product engineering for the commercial and institutional markets.

David Oakey Designs provides carpet design and consulting services to us pursuant to a consulting agreement, and this firm augments our internal research, development and design staff.

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We have developed innovative ways to work with recycled content and bio-based materials, which has led us to make carpet tiles that store carbon, preventing its release into the atmosphere.

For our nora rubber flooring products, the innovation focus is on performance and design.

Our nora rubber flooring products have also focused on innovative performance and design.

A key innovation is the self-adhesive nTx solution for nora tiles and sheet goods.

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The combination of performance and design makes nora the recognized market leader in rubber flooring.

In January 2025, the Company unveiled the first of a kind carbon negative nora rubber flooring prototype, which has a carbon negative footprint when measured cradle to gate.

Environmental and Sustainability Initiatives

Our sustainability strategy began more than 25 years ago with initiatives aimed at reducing waste, environmental footprint and costs.

With our more recent Climate Take Back initiative, we seek to lead industry in designing and making products in ways that will maintain a climate fit for life.

Our Climate Take Back logo appears on many of our marketing and merchandising materials distributed throughout the world.

With our new CQuestGB, CQuestBio and CQuestBioX backings, we are able to use more bio-based and recycled materials.

As more customers in our target markets share our view that sustainability is an important factor, we expect sustainability will become a determining factor in purchasing and design decisions.

With our CQuestGB, CQuestBio and CQuestBioX backings, we are able to use more bio-based and recycled materials.

As more customers in our target markets share our view that sustainability is an important factor, we expect sustainability will become an increasingly important factor in purchasing and design decisions.

In 2021, we set a goal to reduce our CO2 emissions across our Company and supply chain by 2030 with targets validated by the Science Based Targets Initiative.

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We also set a separate goal to become a carbon negative enterprise by 2040.

In 2022, we became the first and only flooring manufacturer to achieve third-party Carbon Neutral Enterprise certification.

Our claim of Carbon Neutral Enterprise status has been third-party certified to meet the PAS 2060 standard, the leading international carbon neutrality standard created by the British Standards Institution (BSI).

The Carbon Neutral Enterprise certification builds on our history as a purpose-driven flooring company.

Achieving Carbon Neutral Enterprise status is a continuation of our innovation efforts and it brings us one step closer to becoming a carbon negative enterprise by 2040.

Compliance with Government Regulations

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Some of our more prominent registered trademarks include:

Interface, FLOR, GlasBac, CQuest, Climate Take Back, nora, norament, noraplan, nTX solution, noraplan unita, noraplan valua, and TacTiles.

Interface, FLOR, GlasBac, CQuest, nora, norament, noraplan, nTX solution, noraplan unita, noraplan valua, and TacTiles.

Trademark registrations in the United States are valid for a period of 10 years and are renewable for additional 10-year periods as long as the mark remains in actual use.

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We strive to do the right thing and to be generous to people and the planet.

We are committed to an equitable and inclusive culture and achieve this by living our values.

Our core values represent who we are, how we see the world, how we treat each other and our external customers and stakeholders, and how we approach our work every day.

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This report on Form 10-K contains “forward-looking statements” within the meaning of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995.

Words such as “believes,” “anticipates,” “plans,” “expects” and similar expressions are intended to identify forward-looking statements.

Words such as “believes,” “anticipates,” “plans,” “expects,” “projects,” “estimates” and similar expressions are intended to identify forward-looking statements.

Forward-looking statements include statements regarding the intent, belief or current expectations of our management team, as well as the assumptions on which such statements are based.

Any forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties that could cause actual results to differ materially from those contemplated by such forward-looking statements.

Forward-looking statements in this report include, without limitation, any statements regarding the effects of inflation, high interest rates, current wars and conflicts, the supply chain environment, slow market conditions in certain geographic areas, tariffs, freight costs, pressures in the commercial office market and other macroeconomic factors, and our future production volumes per unit fixed costs, on our future performance.

We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.

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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 1. Business