What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-08-05 compared with 2025-05-06 · 797 added, 154 removed, 405 unchanged (70% of the section changed)

3 unchanged sentences

(In thousands)

March 29, 2025 December 31, 2024

June 28, 2025

December 31, 2024

Current assets:

9 unchanged sentences

Property and equipment:

Land 2,349 2,316

Buildings and improvements

Machinery and equipment

Software 10,434 10,351

Construction in progress

1 unchanged sentence

Property and equipment, net

Goodwill 46,928 46,819

Intangible assets, net

Operating lease right-of-use assets

Other assets 22,902 21,535

Total assets $ 453,841 $ 450,935

Continues on the following page.

See accompanying notes.

VISHAY PRECISION GROUP, INC.

1 unchanged sentence

(In thousands)

March 29, 2025 December 31, 2024

Liabilities and equity (Unaudited)

June 28, 2025

December 31, 2024

Liabilities and equity

Current liabilities:

2 unchanged sentences

Other accrued expenses

Income taxes 71 880

Current portion of operating lease liabilities

6 unchanged sentences

Total liabilities

Common stock 1,338 1,336

Class B convertible common stock

6 unchanged sentences

Noncontrolling interests

Total equity 325,015 321,860

Total liabilities and equity

4 unchanged sentences

Fiscal Quarter Ended

March 29, 2025 March 30, 2024

Net revenues $ 71,741 $ 80,783

June 28, 2025

June 29, 2024

Costs of products sold

Gross profit 27,045 35,094

Selling, general and administrative expenses

Restructuring costs

Operating (loss) income

Operating income

Other (expense) income:

Interest expense

Other ( 677 ) 1,860

Other (expense) income

Income before taxes

Income tax expense

net earnings attributable to noncontrolling interests

Net earnings attributable to VPG stockholders

Basic earnings per share attributable to VPG stockholders

Diluted earnings per share attributable to VPG stockholders

Weighted average shares outstanding - basic

Weighted average shares outstanding - diluted

See accompanying notes.

VISHAY PRECISION GROUP, INC.

Consolidated Condensed Statements of Operations

(Unaudited - In thousands, except per share amounts)

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

Costs of products sold

Selling, general and administrative expenses

Restructuring costs

Operating income

Other (expense) income :

Interest expense

Other (expense) income

(Loss) Income before taxes

( 1,287 ) 8,150

Income tax (benefit) expense

( 332 ) 2,318

Income tax expense

Net (loss) earnings

net earnings attributable to noncontrolling interests ( 13 ) ( 59 )

net earnings (loss) attributable to noncontrolling interests

Net (loss) earnings attributable to VPG stockholders

8 unchanged sentences

Fiscal Quarter Ended

March 29, 2025 March 30, 2024

Net (loss) earnings $ ( 955 ) $ 5,832

June 28, 2025

June 29, 2024

Other comprehensive income (loss), net of tax:

7 unchanged sentences

VISHAY PRECISION GROUP, INC.

Consolidated Condensed Statements of Comprehensive Income (Loss)

(Unaudited - In thousands)

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

Net (loss) earnings

Other comprehensive income (loss), net of tax:

Foreign currency translation adjustment

Pension and other postretirement actuarial items

Other comprehensive income (loss)

Comprehensive income

comprehensive income (loss) attributable to noncontrolling interests

Comprehensive income attributable to VPG stockholders

See accompanying notes.

VISHAY PRECISION GROUP, INC.

Consolidated Condensed Statements of Cash Flows

(Unaudited - In thousands)

Three fiscal months ended

March 29, 2025 March 30, 2024

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

Operating activities

9 unchanged sentences

Accounts receivable

Inventories 227 ( 2,887 )

Prepaid expenses and other current assets

14 unchanged sentences

Effect of exchange rate changes on cash and cash equivalents

Increase (decrease) in cash and cash equivalents 4,620 ( 949 )

Increase in cash and cash equivalents

Cash and cash equivalents at beginning of period

9 unchanged sentences

Fiscal Quarter Ended

March 29, 2025

Stock Class B

Common Stock Treasury Stock Capital in

Par Value Retained

Earnings Accumulated

June 28, 2025

Total VPG Inc.

Comprehensive

Income (Loss) Total VPG Inc.

Stockholders'

Equity Noncontrolling

Interests Total

Balance at December 31, 2024 $ 1,336 $ 103 $ ( 25,335 ) $ 202,783 $ 191,977 $ ( 48,897 ) $ 321,967 $ ( 107 ) $ 321,860

Net loss — — — — ( 942 ) — ( 942 ) ( 13 ) ( 955 )

Noncontrolling

Income (Loss)

Balance at March 29, 2025

$ 1,338 $ 103 $ ( 25,335 ) $ 203,071 $ 191,035 $ ( 45,224 ) $ 324,988 $ 27 $ 325,015

— — — — 248 — 248 56 304

Other comprehensive income

— — — — — 5,508 5,508 — 5,508

Share-based compensation expense

2 unchanged sentences

1 — — ( 46 ) — — ( 45 ) — ( 45 )

Excise tax on net share repurchase

— — — — — — — — —

Distributions to noncontrolling interests

Balance at March 29, 2025 $ 1,338 $ 103 $ ( 25,335 ) $ 203,071 $ 191,035 $ ( 45,224 ) $ 324,988 $ 27 $ 325,015

— — — — — — — ( 39 ) ( 39 )

Balance at June 28, 2025

$ 1,339 $ 103 $ ( 25,335 ) $ 203,537 $ 191,283 $ ( 39,716 ) $ 331,211 $ 44 $ 331,255

Fiscal Quarter Ended

March 30, 2024

Stock Class B

Common Stock Treasury Stock Capital in

Par Value Retained

Earnings Accumulated

June 29, 2024

Total VPG Inc.

Comprehensive

Income (Loss) Total VPG Inc.

Stockholders'

Equity Noncontrolling

Interests Total

Balance at December 31, 2023 $ 1,330 $ 103 $ ( 17,460 ) $ 202,672 $ 182,066 $ ( 38,869 ) $ 329,842 $ 83 $ 329,925

Net earnings — — — — 5,891 — 5,891 ( 59 ) 5,832

Noncontrolling

Income (Loss)

Balance at March 30, 2024

$ 1,334 $ 103 $ ( 20,230 ) $ 202,475 $ 187,957 $ ( 43,763 ) $ 327,876 $ ( 8 ) $ 327,868

— — — — 4,603 — 4,603 39 4,642

Other comprehensive loss

— — — — — ( 2,602 ) ( 2,602 ) — ( 2,602 )

Share-based compensation expense

5 unchanged sentences

— — ( 3,132 ) — — — ( 3,132 ) — ( 3,132 )

Excise tax on net share repurchases — — ( 15 ) — — — ( 15 ) — ( 15 )

Excise tax on net share repurchase

— — ( 26 ) — — — ( 26 ) — ( 26 )

Distributions to noncontrolling interests

Balance at March 30, 2024 $ 1,334 $ 103 $ ( 20,230 ) $ 202,475 $ 187,957 $ ( 43,763 ) $ 327,876 $ ( 8 ) $ 327,868

— — — — — — — ( 8 ) ( 8 )

Balance at June 29, 2024

$ 1,336 $ 103 $ ( 23,388 ) $ 202,765 $ 192,560 $ ( 46,365 ) $ 327,011 $ 23 $ 327,034

See accompanying notes.

VISHAY PRECISION GROUP, INC.

Consolidated Condensed Statements of Equity

(Unaudited - In thousands, except share amounts)

Six Fiscal Months Ended June 28, 2025

Total VPG Inc.

Comprehensive

Stockholders'

Noncontrolling

Income (Loss)

Balance at December 31, 2024

$ 1,336 $ 103 $ ( 25,335 ) $ 202,783 $ 191,977 $ ( 48,897 ) $ 321,967 $ ( 107 ) $ 321,860

— — — — ( 694 ) — ( 694 ) 43 ( 651 )

Other comprehensive income

— — — — — 9,181 9,181 — 9,181

Share-based compensation expense

— — — 1,057 — — 1,057 — 1,057

Restricted stock issuances ( 37,464 shares)

3 — — ( 303 ) — — ( 300 ) — ( 300 )

Excise tax on net share repurchase

— — — — — — — — —

Distributions to noncontrolling interests

— — — — — — — 108 108

Balance at June 28, 2025

$ 1,339 $ 103 $ ( 25,335 ) $ 203,537 $ 191,283 $ ( 39,716 ) $ 331,211 $ 44 $ 331,255

Six Fiscal Months Ended June 29, 2024

Total VPG Inc.

Comprehensive

Stockholders'

Noncontrolling

Income (Loss)

Balance at December 31, 2023

$ 1,330 $ 103 $ ( 17,460 ) $ 202,672 $ 182,066 $ ( 38,869 ) $ 329,842 $ 83 $ 329,925

— — — — 10,494 — 10,494 ( 20 ) 10,474

Other comprehensive loss

— — — — — ( 7,496 ) ( 7,496 ) — ( 7,496 )

Share-based compensation expense

— — — 953 — — 953 — 953

Restricted stock issuances ( 55,219 shares)

6 — — ( 860 ) — — ( 854 ) — ( 854 )

Purchase of treasury stock ( 181,475 shares)

— — ( 5,887 ) — — — ( 5,887 ) — ( 5,887 )

Excise tax on net share repurchase

— — ( 41 ) — — — ( 41 ) — ( 41 )

Distributions to noncontrolling interests

— — — — — — — ( 40 ) ( 40 )

Balance at June 29, 2024

$ 1,336 $ 103 $ ( 23,388 ) $ 202,765 $ 192,560 $ ( 46,365 ) $ 327,011 $ 23 $ 327,034

See accompanying notes.

Vishay Precision Group, Inc.

Notes to Unaudited Consolidated Condensed Financial Statements

8 unchanged sentences

These consolidated condensed financial statements should be read in conjunction with the consolidated financial statements and notes thereto as of December 31, 2024 and 2023 and for each of the three years in the period ended December 31, 2024 , included in VPG’s Annual Report on Form 10 -K for the fiscal year ended December 31, 2024 , filed with the SEC on February 25, 2025.

The results of operations for the fiscal quarter ended March 29, 2025 are not necessarily indicative of the results to be expected for the full year.

The results of operations for the fiscal quarter ended June 28, 2025 are not necessarily indicative of the results to be expected for the full year.

VPG reports interim financial information for 13 -week periods beginning on a Sunday and ending on a Saturday, except for the first quarter, which always begins on January 1, and the fourth quarter, which always ends on December 31.

The four fiscal quarters in 2025 and 2024 end on the following dates:

Quarter 1 March 29, March 30,

Quarter 2 June 28, June 29,

Quarter 3 September 27, September 28,

Quarter 4 December 31, December 31,

September 27,

September 28,

Recent Accounting Pronouncements

The Company evaluates the applicability and impact of all Accounting Standards Updates ("ASUs") issued by the Financial Accounting Standards Board ("FASB").

Recent accounting pronouncements

In November 2023, the FASB issued ASU 2023 - 07, Segment Reporting (Topic 280 ):

15 unchanged sentences

The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

Note 1 – Basis of Presentation (continued)

In November 2024, the FASB issued ASU No.

9 unchanged sentences

Fiscal Quarter Ended

March 29, 2025 Fiscal quarter ended

March 30, 2024

Sensors Weighing Solutions Measurement Systems Total Sensors Weighing Solutions Measurement Systems Total

Fiscal Quarter Ended

June 28, 2025

June 29, 2024

Weighing Solutions

Measurement Systems

Weighing Solutions

Measurement Systems

United States

Europe 8,346 12,093 469 20,908 9,075 14,230 2,426 25,731

Asia 4,863 3,120 2,212 10,195 6,273 3,175 3,446 12,894

Canada — 7 3,279 3,286 — 34 5,209 5,243

Israel 3,370 33 — 3,403 4,188 77 — 4,265

Total $ 27,055 $ 26,439 $ 18,247 $ 71,741 $ 29,415 $ 28,844 $ 22,524 $ 80,783

Six Fiscal Months Ended June 28, 2025

Six Fiscal Months Ended June 29, 2024

Weighing Solutions

Measurement Systems

Weighing Solutions

Measurement Systems

United States

The following table disaggregates net revenue from contracts with customers by market sector (in thousands) .

Fiscal Quarter Ended

March 29, 2025 March 30, 2024

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Test & Measurement

4 unchanged sentences

General Industrial

Steel 9,455 12,670

Total $ 71,741 $ 80,783

Contract Assets & Liabilities

4 unchanged sentences

The term between invoicing and when payment is due is not significant.

Note 2 – Revenues (continued)

The outstanding contract assets and liability accounts were as follows (in thousands) :

Contract Asset Contract Liability

Unbilled Revenue Accrued Customer Advances

Contract Asset

Contract Liability

Balance at December 31, 2024

Balance at March 29, 2025 3,468 7,455

Balance at June 28, 2025

Increase (decrease)

The amount of revenue recognized during the three fiscal months ended March 29, 2025 that was included in the contract liability balance at December 31, 2024 was $ 2.5 million.

The amount of revenue recognized during the six fiscal months ended June 28, 2025 that was included in the contract liability balance at December 31, 2024 was $ 1.5 million.

Note 3 – Assets held for sale

1 unchanged sentence

The Company determined that the criteria for classifying the asset as held for sale as of December 31, 2024 , had been met.

Accordingly, the carrying value of the asset as of March 29, 2025 is presented separately as a current asset in the consolidated balance sheet.

The Company expects to complete the sale within the next twelve months at a price which is higher than the carrying value of the asset.

A summary of the assets held for sale as of March 29, 2025 is included in the table below:

Location Asset Category Cost Accumulated Depreciation Net Carrying Value

Kent, Washington Land $ 1,800 $ — $ 1,800

Accordingly, the carrying value of the asset as of June 28, 2025 is presented separately as a current asset in the consolidated balance sheet.

A summary of the assets held for sale as of June 28, 2025 is included in the table below:

Asset Category

Accumulated Depreciation

Net Carrying Value

Kent, Washington

Building & Improvements

$ 6,710 $ 1,481 $ 5,229

The Company completed the sale during July 2025 at a price which is higher than the carrying value of the asset (see Note 18 - Subsequent event).

Note 4 – Goodwill

The Company tests the goodwill in each of its goodwill reporting units for impairment at least annually, as of the first day of its fourth quarter, and whenever events or changes in circumstances occur indicating that a possible impairment may have been incurred.

The change in the carrying amount of goodwill by segment is as follows (in thousands):

Total Measurement Systems Weighing Solutions

Steel Nokra DSI DTS On-board weighing

The change in the carrying amount of goodwill by reporting unit is as follows (in thousands):

Measurement Systems

Weighing Solutions

On-board weighing

Balance at December 31, 2024

Adjustment (1)

Foreign currency translation adjustment

Balance at March 29, 2025 $ 46,928 $ 5,998 $ 1,696 $ 16,890 $ 16,033 $ 6,311

Balance at June 28, 2025

( 1 ) The goodwill resulting from the acquisition of Nokra in September 2024, was allocated to the Steel reporting unit.

Note 5 – Leases

The Company primarily leases office and manufacturing facilities in addition to vehicles, which have remaining terms ranging from less than one year to eleven years, seven months .

The Company primarily leases office and manufacturing facilities in addition to vehicles, which have remaining terms ranging from less than one year to eleven years, four months.

The Company has no finance leases.

Leases recorded on the balance sheet consist of the following (in thousands) :

Leases March 29, 2025 December 31, 2024

June 28, 2025

December 31, 2024

Operating lease right of use asset

$ 23,113 $ 24,316

Operating lease - current

$ 4,321 $ 3,998

Operating lease - non-current

$ 19,212 $ 19,928

Other information related to lease term and discount rate is as follows:

March 29, 2025

Operating leases weighted average remaining lease term (in years) 6.85 years

June 28, 2025

Operating leases weighted average remaining lease term (in years)

Operating leases weighted average discount rate

The components of lease expense are as follows (in thousands) :

Fiscal quarter ended

March 29, 2025 March 30, 2024

Fiscal Quarter Ended Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Operating lease cost

$ 1,344 $ 1,321 $ 2,675 $ 2,704

Short-term lease cost

Sublease income

( 131 ) ( 111 ) ( 248 ) ( 224 )

Total net lease cost

Right of use assets obtained in exchange for new operating lease liability during the three fiscal months ended March 29, 2025 were $ 0.3 million.

The Company paid $ 1.3 million and $ 1.4 million for its operating leases for each of the three fiscal months ended March 29, 2025 and March 30, 2024 respectively, which are included in operating cash flows on the consolidated condensed statements of cash flows.

Undiscounted maturities of operating lease payments as of March 29, 2025 are summarized as follows (in thousands) :

Thereafter 8,806

$ 1,228 $ 1,217 $ 2,466 $ 2,505

Right of use assets obtained in exchange for new operating lease liability during the six fiscal months ended June 28, 2025 were $ 0.5 million.

The Company paid $ 2.7 million for its operating leases for each of the six fiscal months ended June 28, 2025 and June 29, 2024 , which are included in operating cash flows on the consolidated condensed statements of cash flows.

Undiscounted maturities of operating lease payments as of June 28, 2025 are summarized as follows (in thousands) :

Total future minimum lease payments

2 unchanged sentences

Note 6 – Income Taxes

For the fiscal quarter ended March 29, 2025, the Company reported tax benefits, and its effective tax rate was 25.8 % compared to the fiscal quarter ended March 30, 2024, where the Company reported income taxes, and its effective tax rate was 28.4 %.

The effective tax rate for the fiscal quarter ended March 29, 2025 differs from the federal statutory rate of 21% due to foreign income taxed at different tax rates and changes in our valuation allowance on deferred tax assets.

The effective tax rate for the fiscal quarter ended March 30, 2024 differs from the federal statutory rate of 21% due to foreign income taxed at different tax rates and changes in our valuation allowance on deferred tax assets.

For the fiscal quarter ended June 28, 2025 , the Company reported tax expenses, and its effective tax rate was 66.0 % compared to the fiscal quarter ended June 29, 2024 , where the Company reported income taxes, and its effective tax rate was 33.3 %.

The effective tax rate for the fiscal quarter ended June 28, 2025 resulted primarily from our foreign income being taxed at varying tax rates and changes in our valuation allowance on deferred tax assets.

The effective tax rate for the fiscal quarter ended June 29, 2024 resulted primarily from our foreign income being taxed at varying tax rates and changes in our valuation allowance on deferred tax assets.

For the six months ended June 28, 2025, the Company reported income taxes at an effective tax rate of ( 66.5 )%, compared to the six months ended June 29, 2024, where the Company reported income taxes at an effective tax rate of 30.7 %.

The change in effective tax rate in the six months ended June 28, 2025 compared to the corresponding period in the prior fiscal year is mainly due to fiscal year 2025 second quarter profits that increased the Company’s tax expenses, in addition to the effect of foreign currency exchange rates on tax provisions in our non-US entities, and the valuation allowance on part of our deferred tax assets.

On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted into law, extending key provisions of the 2017 Tax Cuts and Jobs Act.

The OBBBA provides for accelerated depreciation for property acquired and placed in service after January 19, 2025, and restores expensing of domestic research expenditures for years beginning after December 31, 2024.

Additionally, the OBBBA restores the EBITDA-based interest expense limitation and includes changes related to the U.S.

taxation of the income of our foreign subsidiaries and certain foreign derived income, and the base erosion and anti-abuse tax.

The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.

The Company is continuing to evaluate the impact of the OBBBA on the consolidated financial statements.

The Company and its subsidiaries are subject to income taxes imposed by the U.S., various states, and the foreign jurisdictions in which we operate.

8 unchanged sentences

Long-term debt consists of the following (in thousands) :

March 29, 2025 December 31, 2024

June 28, 2025

December 31, 2024

Credit Agreement - Revolving Facility

16 unchanged sentences

The obligations of the Company under the 2024 Credit Agreement are secured by pledges of stock in certain domestic and foreign subsidiaries, as well as guarantees by substantially all of the Company’s domestic subsidiaries.

The obligations of the Company and the guarantors under the 2024 Credit Agreement are secured by substantially all the assets (excluding real estate)

Note 7 - Long-Term Debt (continued)

of the Company and such guarantors.

The obligations of the Company and the guarantors under the 2024 Credit Agreement are secured by substantially all the assets (excluding real estate) of the Company and such guarantors.

The 2024 Credit Agreement restricts the Company from paying cash dividends and requires the Company to comply with other customary covenants, representations, and warranties, including the maintenance of specific financial ratios.

The financial maintenance covenants include an interest coverage ratio and a leverage ratio.

The Company was in compliance with its financial maintenance covenants at March 29, 2025.

The Company was in compliance with its financial maintenance covenants at June 28, 2025 .

If the Company is not in compliance with any of these covenant restrictions, the 2024 Revolving Facility could be terminated by the lenders, and all amounts outstanding pursuant to the 2024 Revolving Facility could become immediately payable.

1 unchanged sentence

The components of accumulated other comprehensive income (loss), net of tax, consist of the following (in thousands) :

Foreign Currency Translation Adjustment Pension

Postretirement

Actuarial Items Total

Actuarial Items

Balance at January 1, 2025

Other comprehensive income before reclassifications

Amounts reclassified from accumulated other comprehensive loss — ( 8 ) ( 8 )

Balance at March 29, 2025 $ ( 45,234 ) $ 10 $ ( 45,224 )

Foreign Currency Translation Adjustment Pension

Amounts reclassified from accumulated other comprehensive income

Balance at June 28, 2025

Postretirement

Actuarial Items Total

Actuarial Items

Balance at January 1, 2024

Other comprehensive loss before reclassifications

Amounts reclassified from accumulated other comprehensive income — ( 2 ) ( 2 )

Balance at March 30, 2024 $ ( 44,154 ) $ 391 $ ( 43,763 )

Amounts reclassified from accumulated other comprehensive loss

Balance at June 29, 2024

Reclassifications of pension and other postretirement actuarial items out of accumulated other comprehensive income (loss) are included in the computation of net periodic benefit cost (see Note 9 ).

3 unchanged sentences

Fiscal Quarter Ended

March 29, 2025 Fiscal quarter ended

March 30, 2024

Plans Pension

Fiscal Quarter Ended

June 28, 2025

June 29, 2024

Net service cost

3 unchanged sentences

Net periodic benefit cost

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

Net service cost

Interest cost

Expected return on plan assets

Amortization of actuarial losses (gains)

Net periodic benefit cost

Note 10 – Share-Based Compensation

1 unchanged sentence

2022 Stock Incentive Plan (the "2022 plan") permits issuance of up to 608,000 shares of common stock.

At March 29, 2025, the Company had reserved 378,739 shares of common stock for future grants of equity awards (restricted stock, unrestricted stock, restricted stock units ("RSUs"), or stock options) pursuant to the 2022 plan.

At June 28, 2025 , the Company had reserved 378,739 shares of common stock for future grants of equity awards (restricted stock, unrestricted stock, restricted stock units ("RSUs"), or stock options) pursuant to the 2022 plan.

If any outstanding awards are forfeited by the holder or canceled by the Company, the underlying shares would be available for re-grant to others.

9 unchanged sentences

The performance-based portion of the RSUs will also vest on January 1, 2028, subject to the employees' continued employment and the satisfaction of certain performance objectives relating to three -year cumulative earnings and cash flow goals, each weighted equally.

On May 21, 2025, and in accordance with the Company's 2025 Non-Employee Director Compensation Plan, the Board of Directors ("Board") approved the issuance of an aggregate of 18,252 RSUs to the independent board members of the Board.

The awards had an aggregate grant-date fair value of $ 0.5 million and will vest on or before the 2026 Annual Stockholders Meeting in May 2026, subject to each applicable director's continued service on the Board.

Vesting of equity awards is subject to acceleration under certain circumstances.

The amount of compensation cost related to share-based payment transactions is measured based on the grant-date fair value of the equity instruments issued.

3 unchanged sentences

Fiscal Quarter Ended

March 29, 2025 March 30, 2024

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Share-based compensation expense

$ 512 $ 292 $ 1,057 $ 953

Note 11 – Segment Information

7 unchanged sentences

Management believes that evaluating segment performance, excluding items such as restructuring, severance, impairment of goodwill and indefinite-lived intangible assets and amortization of intangible assets, acquisition costs, and other items is meaningful because they relate to occurrences or events that are outside of our core operations, and management believes that the use of these measures provides a consistent basis to evaluate our operating profitability and performance trends across comparable periods.

The following table sets forth reporting segment information (in thousands) :

Note 11 – Segment Information (continued)

Sensors Weighing Solutions Measurement Systems Corporate/

Three Months Ended March 29, 2025

The following table sets forth reporting segment information (in thousands) :

Weighing Solutions

Measurement Systems

Corporate/ Other

Three Fiscal Months Ended June 28, 2025

Net third-party revenues

2 unchanged sentences

Costs of products sold

Gross profit 8,146 9,717 9,182 — 27,045

Research and development expenses

5 unchanged sentences

Capital expenditures

Three Months Ended March 30, 2024

Three Fiscal Months Ended June 29, 2024

Net third-party revenues

2 unchanged sentences

Costs of products sold

Gross profit 10,732 11,266 13,096 — 35,094

Research and development expenses

5 unchanged sentences

Capital expenditures

Weighing Solutions

Measurement Systems

Corporate/ Other

Six Fiscal Months Ended June 28, 2025

Net third-party revenues

Intersegment revenues

Total revenues

Costs of products sold

Research and development expenses

Segment selling, general, and administrative expenses (1)

Segment operating income

Other supplemental information:

Restructuring costs

Depreciation and amortization expense

Capital expenditures

Six Fiscal Months Ended June 29, 2024

Net third-party revenues

Intersegment revenues

Total revenues

Costs of products sold

Research and development expenses

Segment selling, general, and administrative expenses (1)

Segment operating income

Other supplemental information:

Restructuring costs

Depreciation and amortization expense

Capital expenditures

Segment selling, general and administrative expenses are direct selling, general and administrative expenses, excluding research and development expenses and amortization of intangible assets attributed to the segment.

Note 11 – Segment Information (continued)

The following table reconciles segment profit to consolidated income before taxes (in thousands) :

Three fiscal months ended

March 29, 2025 March 30, 2024

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Segment operating income

1 unchanged sentence

Unallocated G&A expenses

Operating (loss) income $ ( 60 ) $ 6,918

Operating income

Other (expense) income

(Loss) income before taxes $ ( 1,287 ) $ 8,150

Note 11 - Segment Information (continued)

Income (loss) before taxes

Products are transferred between segments on a basis intended to reflect, as nearly as practicable, the market value of the products.

1 unchanged sentence

Fiscal Quarter Ended

March 29, 2025 March 30, 2024

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Sensors to Weighing Solutions

3 unchanged sentences

Fiscal Quarter Ended

March 29, 2025 March 30, 2024

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Numerator for basic earnings per share:

Net (loss) earnings attributable to VPG stockholders $ ( 942 ) $ 5,891

Net earnings (loss) attributable to VPG stockholders

Denominator for basic earnings per share:

5 unchanged sentences

Adjusted weighted average shares

Basic (loss) earnings per share attributable to VPG stockholders $ ( 0.07 ) $ 0.44

Diluted (loss) earnings per share attributable to VPG stockholders $ ( 0.07 ) $ 0.44

Basic earnings (loss) per share attributable to VPG stockholders

Diluted earnings (loss) per share attributable to VPG stockholders

The Company’s potentially dilutive securities were not included in the calculation of diluted loss per share for the six fiscal months ended June 28, 2025 as the effect would be anti-dilutive.

The number of restricted stock units with a potentially dilutive impact was 66,683 .

Note 13 – Additional Financial Statement Information

2 unchanged sentences

Fiscal Quarter Ended

March 29, 2025 March 30, 2024

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Foreign currency exchange (loss) gain

$ ( 972 ) $ 1,589

Interest income

Pension expense

Other ( 14 ) ( 42 )

$ ( 677 ) $ 1,860

Note 13 – Additional Financial Statement Information ( continued)

Foreign currency exchange loss for the fiscal quarter ended March 29, 2025 was higher mainly due to volatility in the global currency markets and the strengthening of the U.S.

dollar against the Japanese yen which increased the value of yen-based liabilities relative to the dollar.

Foreign currency exchange gain or loss is due to volatility in the global currency markets.

For the quarter ended and six fiscal months ended June 28, 2025 the foreign currency exchange loss was largely due to the fluctuation of the Japanese yen and the Israeli Shekel against the U.S.

Other Accrued Expenses

Other accrued expenses consist of the following (in thousands) :

March 29, 2025 December 31, 2024

June 28, 2025

December 31, 2024

Customer advance payments

6 unchanged sentences

Current accrued pensions and other post retirement costs

Other 2,103 1,980

$ 21,348 $ 19,725

Note 14 – Fair Value Measurements

9 unchanged sentences

Fair value measurements at reporting date using:

Fair Value Level 1

Inputs Level 2

Inputs Level 3

March 29, 2025

June 28, 2025

Assets held in rabbi trusts

1 unchanged sentence

Assets held in rabbi trusts

Note 14 – Fair Value Measurements (continued)

The Company maintains non-qualified trusts, referred to as “rabbi” trusts, to fund payments under deferred compensation and non-qualified pension plans.

Rabbi trust assets consist primarily of marketable securities, classified as available-for-sale money market funds at March 29, 2025 and December 31, 2024, and company-owned life insurance assets.

Rabbi trust assets consist primarily of marketable securities, classified as available-for-sale money market funds at June 28, 2025 and December 31, 2024 , and company-owned life insurance assets.

The marketable securities held in the rabbi trusts are valued using quoted market prices on the last business day of the period.

1 unchanged sentence

The fair value measurement of the cash equivalents held in the rabbi trust are considered a Level 1 measurement and the measurement of the company-owned life insurance assets is considered a Level 2 measurement within the fair value hierarchy.

The fair value of the long-term debt, excluding capitalized deferred financing costs, at March 29, 2025 and December 31, 2024 approximates its carrying value as the revolving debt is reset on a monthly basis based on current market rates, plus a base rate as specified in the debt agreement.

The fair value of the long-term debt, excluding capitalized deferred financing costs, at June 28, 2025 and December 31, 2024 approximates its carrying value as the revolving debt is reset on a monthly basis based on current market rates, plus a base rate as specified in the debt agreement.

The fair value of long-term debt is considered a Level 2 measurement within the fair value hierarchy.

2 unchanged sentences

Note 15 – Restructuring Costs

Restructuring costs reflect the cost reduction programs implemented by the Company.

Restructuring costs primarily relate to cost reduction programs implemented by the Company.

Restructuring costs are expensed during the period in which the Company determines it will incur those costs and all requirements for accrual are met.

1 unchanged sentence

If the initial estimates are too low or too high, the Company could be required either to record additional expense in future periods or to reverse part of the previously recorded charges.

The Company recorded $ 0.4 million and $ 0.8 million of restructuring costs during the fiscal quarter ended March 29, 2025 and March 30, 2024, respectively.

The Company recorded $ 0.2 million and $ 0.0 million of restructuring costs during the fiscal quarter ended June 28, 2025 and June 29, 2024 , respectively, and $ 0.6 million and $ 0.8 million of restructuring costs during the six fiscal months ended June 28, 2025 and June 29, 2024 , respectively.

Restructuring costs were comprised primarily of employee termination costs, including severance and statutory retirement allowances, and were incurred in connection with various cost reduction programs.

The following table summarizes recent activity related to all restructuring programs.

The accrued restructuring liability balance as of March 29, 2025 and December 31, 2024, respectively, is included in Other accrued expenses in the accompanying consolidated condensed balance sheets (in thousands) :

The accrued restructuring liability balance as of June 28, 2025 and December 31, 2024 , respectively, is included in Other accrued expenses in the accompanying consolidated condensed balance sheets (in thousands) :

Balance at December 31, 2024

2 unchanged sentences

Foreign currency exchange translation

Balance at March 29, 2025 129

Balance at June 28, 2025

Note 16 – Stockholder's Equity

On August 8, 2022, the Board of Directors (the “Board”) of the Company authorized the repurchase of up to 600,000 shares of the Company’s outstanding common stock (the “Stock Repurchase Plan”).

On August 8, 2022, the Board of the Company authorized the repurchase of up to 600,000 shares of the Company’s outstanding common stock (the “Stock Repurchase Plan”).

The Stock Repurchase Plan was originally set to expire on August 11, 2023.

On August 8, 2023, the Company announced that its Board of Directors extended the term of the previously approved stock repurchase plan to August 9, 2024.

On August 8, 2023, the Company announced that its Board extended the term of the previously approved stock repurchase plan to August 9, 2024.

The stock repurchase plan expired in accordance with its terms on August 9, 2024.

4 unchanged sentences

The Company believes that the liability for the assessment is not probable and has filed an appeal against this assessment.

Note 17 – Commitments and Contingencies (continued)

Given the stage of this matter, the Company is currently unable to predict the likely outcome or estimate the potential financial impact, if any, of this matter.

Note 18 – Subsequent Event

Sale of Manufacturing Facility in Kent, Washington

On July 10, 2025, as part of the Company’s ongoing strategy to focus on core operations and optimize its asset base utilization, the Company completed the sale of its manufacturing facility located at Kent, Washington (Weighing Solutions Segment) for total proceeds of $ 11.5 million and net proceeds, after broker’s commission and real estate excise tax, of approximately $ 10.8 million.

The carrying value of the asset was classified as assets held for sale under current asset in the consolidated balance sheet as of December 31, 2024.

The Company expects to recognize a gain related to this transaction of approximately $ 5.6 million in July 2025.

MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

VPG is a global leader in precision measurement and sensing technologies that help power the future by bridging the physical world with the digital one.

Many of our specialized sensors, weighing solutions, and measurement systems are “designed-in” by our customers, and address growing applications across a diverse array of industries and markets.

Our products are marketed under brand names that we believe are characterized as having a very high level of precision and quality, and we employ an operationally diversified structure to manage our businesses.

Driven by the continued proliferation of data generated by the expanding use of sensors across a widening array of industrial and non-industrial applications, precision measurement and sensing technologies help ensure and deliver required levels of quality of mission-critical or high-value data.

VPG’s products are often at the first stage of a data value chain (i.e., the process of converting the physical world into a digital format that can be used for a specific purpose) and as such impact the effectiveness of vast number of critical, high-value downstream processes.

Over the past few years, we have seen a broadening of precision sensing applications in both our traditional industrial markets and new markets, due to the development of higher functionality in our customers' end products.

Our precision measurement solutions are used across a wide variety of end markets upon which we focus, including industrial, industrial automation and robotics, test and measurement, transportation, steel, medical, agriculture, avionics, military and space, and consumer product applications.

The Company has a long heritage of innovation in sensor technologies that provide accuracy, reliability and repeatability that make our customers' products safer, smarter, and more productive.

As the functionality of customers' products continues to increase, and they integrate more precision measurement sensors and related systems into their solutions, we believe this will offer substantial growth opportunities for our products and expertise.

The impact of the recent wars in Israel on our operations

In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets, resulting in extensive casualties and military engagement.

In addition, Hezbollah, another terrorist organization based in Lebanon, began attacking Israel.

While Israel has entered into certain ceasefire agreements regarding the conflicts, the threat of new attacks remains, including from additional extremist groups.

On June 13, 2025, Israel launched a preemptive strike on Iran, with military support from the United States.

Iran retaliated with ballistic missile and drone strikes targeting both civilian and military sites in Israel.

A ceasefire between Israel and Iran was reached on June 23, 2025, although there is no assurance that the ceasefire will continue.

Israel’s airspace and maritime zones, which were closed to commercial traffic during the period between June 13 and June 23, 2025, are fully open as of August 5, 2025.

As of August 5, 2025 (the date of this filing), our operations in Israel are operating at normal levels.

The extent and duration of the current conflicts, as well as the possibility of further spread of the conflicts to other countries in the region and involving other political and military entities in the Middle East, poses risks to our operations and may lead to disruptions which could adversely affect our business, prospects, financial condition and results of operations.

While sales to customers in Israel account for a relatively small portion of our revenues, our operations in Israel include executive offices, which are the workplace for key executives including our chief executive officer, as well as two manufacturing facilities located in the central part of Israel that manufacture products representing approximately 26% of our total worldwide revenues in the six fiscal months ended June 28, 2025.

As of August 5, 2025, these facilities remain open and operational.

We have implemented a contingency plan that, in the event conditions in Israel deteriorate such that we no longer operate there at normal levels, we believe will provide for securing supply of materials and logistics by producing a safety stock of finished goods and transferring these goods to our distribution centers outside of Israel, while continuing to take measures with regards to the safety of our employees.

We may, however, determine to temporarily discontinue production in Israel for the safety of our employees.

We could also face future production slowdowns or interruptions at either manufacturing location in Israel due to the impacts of the conflicts, including personnel absences as a number of our employees have been called to active military duty, or due to other resource constraints such as the inability to source materials for production.

The impact of recent changes in tariffs

We have manufacturing operations in India, China, Japan, Europe, Canada, Israel and the United States, as well as in other countries.

The current political environment in the United States and internationally has resulted in uncertainty surrounding the state of the global economy particularly due to existing and potential changes to U.S.

policies related to global trade and tariffs, The tariff changes have been set at various rates, with exemptions applicable to certain categories of imports and exports.

VPG continues to actively monitor and evaluate the ongoing situation, focusing on quickly responding to cost and price adjustments.

Overview of Financial Results

VPG reports in three product segments:

Sensors, Weighing Solutions, and Measurement Systems.

The Sensors segment is comprised of the foil resistor and strain gage operating segments.

The Weighing Solutions segment is comprised of specialized modules and systems used to precisely measure weight, force torque, and pressure.

The Measurement Systems segment is comprised of highly specialized systems for steel production, materials development, and safety testing.

Net revenues for the fiscal quarter ended June 28, 2025 were $75.2 million versus $77.4 million for the comparable prior year period.

Net profit attributable to VPG stockholders for the fiscal quarter ended June 28, 2025 was $0.3 million, or $0.02 per diluted share, compared to net earnings of $4.6 million, or $ 0.34 per diluted share, for the comparable prior year period.

Net revenues for the six fiscal months ended June 28, 2025 were $146.9 million versus $158.1 million for the comparable prior year period.

Net loss attributable to VPG stockholders for the six fiscal months ended June 28, 2025 was $0.7 million, or $ 0.05 per diluted share, compared to net earnings of $10.5 million, or $0.78 per diluted share, for the comparable prior year period.

The results of operations for the fiscal quarters ended June 28, 2025 and June 29, 2024 include items affecting comparability as listed in the reconciliations below.

The reconciliations below include certain financial measures which are not recognized in accordance with U.S.

generally accepted accounting principles ("GAAP"), including adjusted gross profits, adjusted gross profit margin, adjusted operating income, adjusted operating margin, adjusted net earnings, adjusted net earnings per diluted share, EBITDA, and adjusted EBITDA.

These non-GAAP measures should not be viewed as an alternative to GAAP measures of performance.

Non-GAAP measures such as adjusted gross profits, adjusted gross profit margin, adjusted operating income, adjusted operating margin, adjusted net earnings, adjusted net earnings per diluted share, EBITDA, and adjusted EBITDA do not have uniform definitions.

These measures, as calculated by VPG, may not be comparable to similarly titled measures used by other companies.

Management believes that these non-GAAP measures are useful to investors because each presents what management views as our core operating results for the relevant period.

The adjustments to the applicable GAAP measures relate to occurrences or events that are outside of our core operations, and management believes that the use of these non-GAAP measures provides a consistent basis to evaluate our operating profitability and performance trends across comparable periods.

In addition, the Company has historically provided these or similar non-GAAP measures and understands that some investors and financial analysts find this information helpful in analyzing the Company’s performance and in comparing the Company’s financial performance to that of its peer companies and competitors.

Management believes that the Company’s non-GAAP measures are regarded as supplemental to its GAAP financial results.

Operating Income

Net Earnings Attributable to VPG Stockholders

Diluted Earnings Per share

Three months ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

As reported - GAAP

As reported - GAAP Margins

Start-up costs (a)

Restructuring costs

Severance cost

Foreign currency exchange loss (gain) (b)

Tax effect of reconciling items and discrete tax items

As Adjusted - Non GAAP

As Adjusted - Non GAAP Margins

Operating Income

Net (Loss) Earnings Attributable to VPG Stockholders

Diluted Earnings Per share

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

As reported - GAAP

As reported - GAAP Margins

Start-up costs (a)

Restructuring costs

Severance cost

Foreign currency exchange loss (gain) (b)

Tax effect of reconciling items and discrete tax items

As Adjusted - Non GAAP

As Adjusted - Non GAAP Margins

Fiscal Quarter Ended

For the Six Fiscal Months Ended fiscal months ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Net earnings (loss) earnings attributable to VPG stockholders

Interest Expense

Income tax expense

EBITDA MARGIN

Restructuring costs

Severance cost

Start-up costs (a)

Foreign currency exchange loss (gain) (b)

ADJUSTED EBITDA

ADJUSTED EBITDA MARGIN

(a) Start-up cost 2025

(b) Impact of foreign currency exchange rates on assets and liabilities.

Financial Metrics

We utilize several financial measures and metrics to evaluate performance and assess the future direction of our business.

These key financial measures and metrics include net revenues, gross profit margin, end-of-period backlog, book-to-bill ratio, and inventory turnover.

Gross profit margin is computed as gross profit as a percentage of net revenues.

Gross profit is generally net revenues less costs of products sold, but could also include certain other period costs.

Gross profit margin is a function of net revenues, but also reflects our cost-cutting programs and our ability to contain fixed costs.

End-of-period backlog is one indicator of potential future sales.

We include in our backlog only open orders that have been released by the customer for shipment in the next twelve months.

If demand falls below customers’ forecasts, or if customers do not control their inventory effectively, they may cancel or reschedule the shipments that are included in our backlog, in many instances without the payment of any penalty.

Therefore, backlog is not necessarily indicative of the results expected for future periods.

Another important indicator of demand in our industry is the book-to-bill ratio, which is the ratio of the amount of product ordered during a period compared with the amount of product shipped during that period.

A book-to-bill ratio that is greater than one indicates that revenues may increase in future periods.

Conversely, a book-to-bill ratio that is less than one is an indicator of lower demand and may foretell declining sales.

The book-to-bill ratio is also impacted by the timing of orders, particularly from our project-based product lines.

We focus on inventory turnover as a measure of how well we manage our inventory.

We define inventory turnover for a financial reporting period as our costs of products sold for the four fiscal quarters ending on the last day of the reporting period divided by our average inventory (computed using each quarter-end balance) for this same period.

A higher level of inventory turnover reflects more efficient use of our capital.

The quarter-to-quarter trends in these financial metrics can also be an important indicator of the likely direction of our business.

The following tables show net revenues, gross profit margin, end-of-period backlog, book-to-bill ratio, and inventory turnover for our business as a whole and by segment during the five quarters beginning with the second quarter of 2024 through the second quarter of 2025.

(dollars in thousands)

Gross profit margin

End-of-period backlog

Book-to-bill ratio

Inventory turnover

(dollars in thousands)

Gross profit margin

End-of-period backlog

Book-to-bill ratio

Inventory turnover

Weighing Solutions

Gross profit margin

End-of-period backlog

Book-to-bill ratio

Inventory turnover

Measurement Systems

Gross profit margin

End-of-period backlog

Book-to-bill ratio

Inventory turnover

Net revenues for the second fiscal quarter of 2025 increased 4.8% from the first fiscal quarter of 2025 due to increases in the Measurement Systems and Weighing Solutions reporting segments which were partially offset by a decrease in revenues in the Sensors reporting segment.

Net revenues for the second fiscal quarter of 2025 decreased 2.8% from the second fiscal quarter of 2024 in the Sensors and Measurement Systems reporting segments which were partially offset by an increase in revenues in the Weighing Solutions reporting segment.

Net revenues in the Sensors reporting segment decreased 1.8% compared to $27.1 million in the first fiscal quarter of 2025 and decreased 8.0% from $28.9 million in the second fiscal quarter of 2024.

The year-over-year decrease in revenues was primarily attributable to lower sales of strain gages in our Other markets for consumer applications which offset higher sales in the Test & Measurement market.

Sequentially, the decrease primarily reflected lower sales of precision resistors in the Test and Measurement market.

Net revenues in the Weighing Solutions reporting segment increased 11.3% from the first fiscal quarter of 2025 and increased 7.2% from the second fiscal quarter of 2024.

The year-over-year increase in revenues was mainly attributable to higher sales in the Transportation market, as well as in our Other markets.

Sequentially, the increase in revenues was primarily due to higher sales in the Transportation and Industrial Weighing, and in our Other markets for medical and precision agriculture applications.

Net revenues in the Measurement Systems reporting segment increased 5.1% from the first fiscal quarter of 2025 and decreased 8.9% from the second fiscal quarter of 2024.

The year-over-year decrease was primarily attributable to decreased revenue in the Steel market, which offset higher sales in the Transportation and Avionics, Military and Space ("AMS") markets.

Sequentially, the increase in revenue was primarily due to higher sales in the AMS market, which offset lower sales to the Transportation and Steel markets.

Overall gross profit margin in the second fiscal quarter of 2025 increased 3.0% as compared to the first fiscal quarter of 2025 and decreased 1.2% from the second fiscal quarter of 2024 across all three reporting segments.

Optimize Core Competence

The Company’s core competencies include our innovative deep technical and applications-specific expertise to add value to our customers' products, our strong brands and customer relationships, our focus on operational excellence, our ability to select and develop our management teams, and our proven M&A strategy.

We continue to optimize all aspects of our development, manufacturing and sales processes, including by increasing our technical sales efforts;

continuing to innovate in product performance and design;

and refining our manufacturing processes.

Our Sensors segment research group developed innovations that enhance the capability and performance of our strain gages, while simultaneously reducing their size and power consumption as part of our advanced sensors product line.

We believe this unique foil technology will create new markets as customers “design in” these next generation products in existing and new applications.

Our development engineering team is also responsible for creating new processes to further automate manufacturing and improve productivity and quality.

Our advanced sensors manufacturing technology also offers us the capability to produce high-quality foil strain gages in a highly automated environment, which we believe results in reduced manufacturing and lead times, improved quality and increased margins.

As a sign of our commitment to these businesses, we signed a long-term lease for a state-of-the-art facility that has been constructed in Israel.

Our design, research, and product development teams, in partnership with our marketing teams, drive our efforts to bring innovations to market.

We intend to leverage our insights into customer demand to continually develop and roll out new, innovative products within our existing lines and to modify our existing core products in ways that make them more appealing, addressing changing customer needs and industry trends in terms of form, fit, and function.

We also seek to achieve significant production cost savings through the transfer, expansion, and construction of manufacturing operations in countries such as India, Japan, and Israel, where we can benefit from improved efficiencies or available tax and other government-sponsored incentives.

In the past several years, we incurred restructuring expense related to closing and downsizing of facilities as part of the manufacturing transitions of our load cell products to facilities in India and China, which marked key milestones in our ongoing strategic initiatives to align and consolidate our manufacturing footprint.

Acquisition Strategy

We expect to continue to make strategic acquisitions where opportunities present themselves to grow and expand our segments.

Historically, our growth and acquisition strategy had been largely focused on vertical product integration, using our foil strain gages in our load cell products, and incorporating those products into our weighing solutions.

In recent years, we widened our acquisition strategy to include a broader set of precision measurement systems and product companies.

We expect to expand our expertise, and our acquisition focus, outside our traditional vertical approach to other precision measurement solutions, including in the fields of measurement of force, weight, pressure, torque, tilt, motion, and acceleration.

We believe acquired businesses will benefit from improvements we implement to reduce redundant functions and from our current global manufacturing and distribution footprint.

On September 30, 2024, the Company acquired Nokra Optische Prueftechnik und Automation GmbH, a Germany-based, privately held maker of precision measuring and testing equipment for manufacturing.

Please see our Form 8-K dated September 30, 2024, for more information.

Research and Development

Research and development (“R&D”) will continue to play a key role in our efforts to introduce innovative products to generate new sales and to improve profitability.

We expect to continue to expand our position as a leading supplier of precision foil technology products.

We believe our R&D efforts should provide us with a variety of opportunities to leverage technology, products, and our manufacturing base in order to ultimately improve our financial performance.

Cost Management

To be successful, we believe we must seek new strategies for controlling operating costs.

Through automation in our plants, we believe we can optimize our capital and labor resources in production, inventory management, quality control, and warehousing.

We are in the process of moving some manufacturing to more cost-effective locations.

This may enable us to become more efficient and cost competitive and also maintain tighter controls of the operation.

Production transfers, facility consolidations, and other long-term cost-cutting measures require us to initially incur significant severance and other exit costs.

We are realizing the benefits of our restructuring through lower labor costs and other operating expenses and expect to continue reaping these benefits in future periods.

However, these programs to improve our profitability also involve certain risks which could materially impact our future operating results, as further detailed in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 25, 2025.

We are evaluating plans to further reduce our costs by consolidating additional manufacturing operations.

These plans may require us to incur restructuring and severance costs in future periods.

While streamlining and reducing fixed overhead, we are exercising caution so that we will not negatively impact our customer service or our ability to further develop products and processes.

We test the goodwill in each of our reporting units for impairment at least annually, as of the first day of our fourth quarter, and whenever events or changes in circumstances occur indicating that a possible impairment may have been incurred.

Determining whether to test goodwill for impairment, and the application of goodwill impairment tests, require significant management judgment, including the identification of reporting units, assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value of each reporting unit.

Changes in these estimates could materially affect the determination of fair value for each reporting unit.

A slowdown or deferral of orders for a business, with which we have goodwill associated, could impact our valuation of that goodwill.

Foreign Currency

We are exposed to foreign currency exchange rate risks, particularly due to transactions in currencies other than the functional currencies of certain subsidiaries.

GAAP requires that entities identify the “functional currency” of each of their subsidiaries and measure all elements of the financial statements in that functional currency.

A subsidiary’s functional currency is the currency of the primary economic environment in which it operates.

In cases where a subsidiary is relatively self-contained within a particular country, the local currency is generally deemed to be the functional currency.

However, a foreign subsidiary that is a direct and integral component or extension of the parent company’s operations generally would have the parent company’s currency as its functional currency.

We have subsidiaries that fall into each of these categories.

Foreign Subsidiaries which use the Local Currency as the Functional Currency

Our operations in Europe, Canada, and certain locations in Asia primarily generate and expend cash using local currencies, and accordingly, these subsidiaries utilize the local currency as their functional currency.

For those subsidiaries where the local currency is the functional currency, assets and liabilities in the consolidated condensed balance sheets have been translated at the rate of exchange as of the balance sheet date.

Translation adjustments do not impact the results of operations and are reported as a separate component of equity.

For those subsidiaries where the local currency is the functional currency, revenues and expenses are translated at the average exchange rate for the period.

While the translation of revenues and expenses into U.S.

dollars does not directly impact the consolidated condensed statement of operations, the translation effectively increases or decreases the U.S.

dollar equivalent of revenues generated and expenses incurred in those foreign currencies.

Foreign Subsidiaries which use the U.S.

Dollar as the Functional Currency

Our operations in Israel and certain locations in Asia primarily generate cash in U.S.

dollars, and accordingly, these subsidiaries utilize the U.S.

dollar as their functional currency.

For those foreign subsidiaries where the U.S.

dollar is the functional currency, all foreign currency financial statement amounts are remeasured into U.S.

Exchange gains and losses arising from remeasurement of foreign currency-denominated monetary assets and liabilities are included in the results of operations.

While these subsidiaries transact most business in U.S.

dollars, they may have significant costs, particularly related to payroll, which are incurred in the local currency and significant lease assets and liabilities.

Effects of Foreign Currency Exchange Rate on Operations

For the fiscal quarter ended June 28, 2025, the effect of foreign currency exchange rates increased net revenues by $1.2 million, and increased costs of products sold and selling, general, and administrative expenses by $1.6 million, when compared to the comparable prior year period.

For the six fiscal months ended June 28, 2025, the effect of foreign currency exchange rates increased net revenues by $0.2 million, and increased costs of products sold and selling, general, and administrative expenses by $1.2 million, when compared to the comparable prior year period.

Results of Operations

Statement of operations’ captions as a percentage of net revenues and the effective tax rates were as follows:

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Costs of products sold

Selling, general, and administrative expenses

Operating income

(Loss) income before taxes

Net (loss) earnings

Net (loss) earnings attributable to VPG stockholders

Effective tax rate

Net revenues were as follows (dollars in thousands) :

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Change versus comparable prior year period

Percentage change versus prior year period

Changes in net revenues were attributable to the following:

Change attributable to:

Change in volume

Change in average selling prices

Foreign currency effects

During the quarter ended and six fiscal months ended June 28, 2025, net revenues decreased by 2.8% and 7.1% as compared to the comparable prior year periods, mainly due to lower volume on the Measurements systems and the Sensors segments.

Gross Profit Margin

Gross profit as a percentage of net revenues was as follows:

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Gross profit margin

The gross profit margin for the fiscal quarter ended June 28, 2025, decreased by 1.2% and for the six fiscal months ended June 28, 2025 decreased 3.5% as compared to the comparable prior year periods.

For the second fiscal quarter of 2025, Weighing Solutions and Measurement Systems reporting segments had higher gross profit margins compared to the prior year period.

Analysis of revenues and gross profit margins for each of our reportable segments is provided below.

Net revenues of the Sensors segment were as follows (dollars in thousands) :

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Change versus comparable prior year period

Percentage change versus prior year period

Changes in Sensors segment net revenues were attributable to the following:

Change attributable to:

Change in volume

Change in average selling prices

Foreign currency effects

The Sensors segment revenue of $26.6 million in the second fiscal quarter of 2025 decreased 8.0% from $28.9 million in the second fiscal quarter of 2024;

sequentially, revenue decreased 1.8% compared to $27.1 million in the first fiscal quarter of 2025.

The year-over-year decrease in revenues was primarily attributable to lower sales of strain gages in our markets for consumer applications which offset higher sales in the Test & Measurement market.

Sequentially, the decrease primarily reflected lower sales of precision resistors in the Test and Measurement market.

Gross profit as a percentage of net revenues for the Sensors segment was as follows:

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Gross profit margin

Gross profit margin for the Sensors segment was 32.0% for the second fiscal quarter of 2025, as compared to 38.3% in the second fiscal quarter of 2024, and increased compared to 30.1% in the first fiscal quarter of 2025.

The year-over-year decrease in gross profit margin was primarily due to lower volume, net tariffs cost, and manufacturing inefficiencies, partially offset by an increase in inventories.

Sequentially, the higher gross profit margin was primarily due to an increase in inventories and favorable foreign currency exchange rates, which offset the impact of lower volume and net tariff costs.

Weighing Solutions

Net revenues of the Weighing Solutions segment were as follows (dollars in thousands) :

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Change versus comparable prior year period

Percentage change versus prior year period

Changes in Weighing Solutions segment net revenues were attributable to the following:

Change attributable to:

Change in volume

Change in average selling prices

Foreign currency effects

The Weighing Solutions segment revenue of $29.4 million in the second fiscal quarter of 2025 increased 7.2% compared to $27.5 million in the second fiscal quarter of 2024 and was 11.3% higher than $26.4 million in the first fiscal quarter of 2025.

The year-over-year increase in revenues was mainly attributable to higher sales in the Industrial Weighing and Transportation markets, as well as in our Other markets.

Sequentially, the increase in revenues was primarily attributable to higher sales in the Transportation and Industrial Weighing, and in our Other markets for precision agriculture and medical applications.

Gross profit as a percentage of net revenues for the Weighing Solutions segment was as follows:

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Gross profit margin

Gross profit margin for the Weighing Solutions segment was 39.6% for the second fiscal quarter of 2025, which increased compared to 37.6% in the second fiscal quarter of 2024, and increased compared to 36.8% in the first fiscal quarter of 2025.

The year-over-year increase in gross profit margin was primarily due to higher volume, favorable foreign exchange rates, and cost reduction.

The sequential increase in gross profit margin primarily reflected higher volume and favorable foreign exchange rates, which offset the impact of net tariff costs.

Measurement Systems

Net revenues of the Measurement Systems segment were as follows (dollars in thousands) :

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Change versus comparable prior year period

Percentage change versus prior year period

Changes in Measurement Systems segment net revenues were attributable to the following:

Change attributable to:

Change in volume

Change in average selling prices

Foreign currency effects

The Measurement Systems segment revenue of $19.2 million in the second fiscal quarter of 2025 decreased 8.9% year-over-year from $21.0 million in the second fiscal quarter of 2024 and increased 5.1% from $18.3 million in the first fiscal quarter of 2025.

The year-over-year decrease was primarily attributable to decreased revenue in the Steel market.

which offset higher sales in the Transportation and Avionics, Military and Space ("AMS") markets.

Sequentially, the increase in revenue was primarily due to higher sales in the AMS market, which offset lower sales to the Transportation and Steel markets.

Gross profit as a percentage of net revenues for the Measurement Systems segment were as follows:

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Gross profit margin

Gross profit margin for the Measurement Systems segment was 54.6%, compared to 52.4% in the second fiscal quarter of 2024, and 50.3% in the first fiscal quarter of 2025.

The year-over-year increase in gross profit margin was primarily due to favorable product mix.

The sequentially higher gross profit margin reflected higher volume and favorable product mix.

Selling, General, and Administrative Expenses

Selling, general, and administrative (“SG&A”) expenses are summarized as follows (dollars in thousands) :

Fiscal Quarter Ended

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

June 28, 2025

June 29, 2024

Total SG&A expenses

As a percentage of net revenues

SG&A expenses for the fiscal quarter and six fiscal months ended June 28, 2025 increased $1.2 million and $0.5 million, respectively, compared to the comparable prior year period.

Restructuring Costs

Restructuring costs reflect the cost reduction programs implemented by the Company.

Restructuring costs are expensed during the period in which the Company determines it will incur those costs and all requirements for accrual are met.

Because these costs are recorded based upon estimates, actual expenditures for the restructuring activities may differ from the initially recorded costs.

If the initial estimates are too low or too high, the Company could be required either to record additional expense in future periods or to reverse part of the previously recorded charges.

The Company recorded $0.2 million and $0.0 million of restructuring costs during the fiscal quarter ended June 28, 2025 and June 29, 2024, respectively, and $0.6 million and $0.8 million of restructuring costs during the six fiscal months ended June 28, 2025 and June 29, 2024, respectively.

Restructuring costs were comprised primarily of employee termination costs, including severance and statutory retirement allowances, in connection with various cost reduction programs.

Other Income (Expense)

The following table analyzes the components of the line “Other” on the consolidated condensed statements of operations (in thousands) :

Fiscal Quarter Ended

June 28, 2025

June 29, 2024

Foreign currency exchange (loss) gain

Interest income

Pension expense

Six Fiscal Months Ended

June 28, 2025

June 29, 2024

Foreign currency exchange (loss) gain

Interest income

Pension expense

Foreign currency exchange gain or loss are due to volatility in the global currency markets.

For the fiscal quarter ended June 28, 2025 the foreign currency exchange loss was largely due to the fluctuation of the Israeli Shekel against the U.S.

For the six fiscal months ended June 28, 2025 the foreign currency exchange loss was largely due to the fluctuation of the Japanese yen, Israeli Shekel and the British pound against the U.S.

For the fiscal quarter ended June 28, 2025, the Company reported income tax expense, and its effective tax rate was 66.0% compared to the fiscal quarter ended June 29, 2024, where the Company reported income taxes and its effective tax rate was 33.3%.

The effective tax rate for the fiscal quarter ended June 28, 2025, resulted primarily from our foreign income being taxed at varying tax rates and changes in valuation allowance on deferred tax assets.

The effective tax rate for the fiscal quarter ended June 29, 2024 resulted primarily from the foreign income taxed at varying tax rates and changes in the valuation allowance on deferred tax assets.

For the six months ended June 28, 2025, the Company reported income taxes at an effective tax rate of (66.5)%, compared to the six months ended June 29, 2024, where the Company reported income taxes at an effective tax rate of 30.7%.

The change in effective tax rate in the six months ended June 28, 2025, compared to the corresponding period in the prior fiscal year is mainly due to fiscal year 2025 second quarter that increased the Company's tax expenses, in addition to the effect of foreign currency exchange rates effect on tax provisions in our non-US entities, and the valuation allowance on part of our deferred tax assets.

On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted into law, extending key provisions of the 2017 Tax Cuts and Jobs Act.

Additionally, the OBBBA restores the EBITDA-based interest expense limitation and includes changes related to the U.S.

taxation of the income of our foreign subsidiaries and certain foreign derived income and the base erosion and anti-abuse tax.

The legislation has multiple effective dates, with certain provisions effective in 2024 and other implemented through 2027.

The Company is continuing to evaluate the impact of the OBBBA on its tax expenses.

The Company and its subsidiaries are subject to income taxes imposed by the U.S., various states, and the foreign jurisdictions in which we operate.

Each jurisdiction establishes rules that set forth the years which are subject to examination by its tax authorities.

While the Company believes the tax positions taken on its tax returns for each jurisdiction are supportable, they may still be challenged by the jurisdiction's tax authorities.

In anticipation of such challenges, the Company has established reserves for tax-related uncertainties.

These liabilities are based on the Company’s best estimate of the potential tax exposures in each respective jurisdiction.

It may take a number of years for a final tax liability in a jurisdiction to be determined, particularly in the event of an audit.

If an uncertain matter is determined favorably, there could be a reduction in the Company’s tax expense.

An unfavorable determination could increase tax expense and could require a cash payment, including interest and penalties.

Financial Condition, Liquidity, and Capital Resources

We believe that our current cash and cash equivalents, credit facilities and projected cash from operations will be sufficient to meet our liquidity needs for at least the next 12 months.

On August 15, 2024, the Company entered into a Fourth Amended and Restated Credit Agreement (the “2024 Credit Agreement”) among the Company, the lenders party thereto, JPMorgan Chase Bank, N.A., Wells Fargo Bank, N.A.

and HSBC as joint lead arrangers and joint bookrunner, and JPMorgan Chase Bank, N.A, as agent for such lenders, pursuant to which the 2020 Credit Agreement, as amended, was amended and restated to, among other things, extend the maturity date from March 20, 2025 to August 15, 2029 and adjust the interest rate and commitment fee.

The 2024 Credit Agreement provides for a multi-currency, secured credit facility (the “2024 Revolving Facility”) in an aggregate principal amount of $75.0 million, with a sublimit of $10.0 million which can be used for letters of credit for the account of the Company or its subsidiaries that are parties to the 2024 Credit Agreement, the proceeds of which may be used for working capital and general corporate purposes, and a portion of which were used to refinance the Company’s previously existing credit agreement.

The Company may elect to make loans under the 2024 Revolving Facility in US Dollars, Euros, Canadian Dollars, Sterling, Japanese Yen or such other freely convertible foreign currency.

The obligations of the Company and the guarantors under the 2024 Credit Agreement are secured by substantially all the assets (excluding real estate) of the Company and such guarantors.

The financial maintenance covenants include an interest coverage ratio and a leverage ratio.

The Company was in compliance with its financial maintenance covenants at June 28, 2025.

If the Company is not in compliance with any of these covenant restrictions, the credit facility could be terminated by the lenders, and all amounts outstanding pursuant to the credit facility could become immediately payable.

Our business has historically generated significant cash flow.

For the six fiscal months ended June 28, 2025, cash provided by operating activities was $11.2 million compared to $13.9 million in the comparable prior year period.

Our net cash used in investing activities for the six fiscal months ended June 28, 2025 was lower compared to the prior year period mainly due to lower capital spending.

Our net cash used in financing activities for the six fiscal months ended June 28, 2025 was significantly lower when compared with the prior year period, due to expiration of the stock repurchase plan in accordance with its terms on August 9, 2024.

Approximately 92% and 94% of our cash and cash equivalents balance at June 28, 2025 and December 31, 2024, respectively, was held by our non-U.S.

subsidiaries.

See the following table for the percentage of cash and cash equivalents, by region, at June 28, 2025 and December 31, 2024:

June 28, 2025

December 31, 2024

United States

We earn a significant amount of our operating income outside the United States, the majority of which is deemed to be indefinitely reinvested in foreign jurisdictions.

As a result, as discussed above, a significant portion of our cash and short-term investments are held by foreign subsidiaries.

The Company will continue to evaluate its cash needs, however we currently do not intend, nor do we foresee a need, to repatriate funds in excess of what is already planned.

The Company will evaluate the possibility of repatriating future cash provided such repatriation can be accomplished in a tax efficient manner.

In addition, we expect existing domestic cash, short-term investments, and cash flows from operations to continue to be sufficient to fund our domestic operating activities and cash commitments for investing and financing activities, such as debt repayment and capital expenditures, for at least the next 12 months and thereafter for the foreseeable future.

If we should require more capital in the United States than is generated by our domestic operations, for example, to fund significant discretionary activities, such as business acquisitions, we could elect to repatriate future earnings from foreign jurisdictions or raise capital in the United States through debt or equity issuances.

These alternatives could result in higher tax expense, increased interest expense, or dilution of our earnings.

We consider the majority of the undistributed earnings of our foreign subsidiaries, as of June 28, 2025, to be indefinitely reinvested.

Adjusted free cash flow generated during the six fiscal months ended June 28, 2025, was $8.5 million.

We refer to the amount of cash provided by operating activities ($11.2 million) in excess of our capital expenditures ($2.7 million), net of proceeds, if any, from the sale of assets as “adjusted free cash flow.”

The following table summarizes the components of net cash at June 28, 2025 and December 31, 2024 (in thousands) :

June 28, 2025

December 31, 2024

Cash and cash equivalents

Third-party long-term debt:

Revolving debt

Deferred financing costs

Total third-party debt

Measurements such as “adjusted free cash flow” and “net cash" do not have uniform definitions and are not recognized in accordance with U.S.

Such measures should not be viewed as alternatives to GAAP measures of performance or liquidity.

However, management believes that “adjusted free cash flow” is a meaningful measure of our ability to fund acquisitions, and that an analysis of “net cash” assists investors in understanding aspects of our cash and debt management.

These measures, as calculated by us, may not be comparable to similarly titled measures used by other companies.

Our financial condition as of June 28, 2025 remains strong, with a current ratio (current assets to current liabilities) of 4.4 to 1.0, as compared to a ratio of 4.5 to 1.0 at December 31, 2024.

Cash paid for property and equipment for the six fiscal months ended June 28, 2025 was $2.8 million compared to $5.2 million in the comparable prior year period.

As of June 28, 2025 and December 31, 2024, we did not have any off-balance sheet arrangements.

Safe Harbor Statement

From time to time, information provided by us, including, but not limited to, statements in this report, or other statements made by or on our behalf, may contain or constitute "forward-looking" information within the meaning of the Private Securities Litigation Reform Act of 1995.

Such statements involve a number of risks, uncertainties, and contingencies, many of which are beyond our control, which may cause actual results, performance, or achievements to differ materially from those anticipated.

Such statements are based on current expectations only, and are subject to certain risks, uncertainties, and assumptions.

Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, expected, estimated, or projected.

Among the factors that could cause actual results to materially differ include:

general business and economic conditions;

significant developments from the recent and potential changes in tariffs and trade regulation;

impact of inflation;

potential issues respecting the United States federal government debt ceiling;

global labor and supply chain challenges;

difficulties or delays in identifying, negotiating and completing acquisitions and integrating acquired companies;

the inability to realize anticipated synergies and expansion possibilities;

difficulties in new product development;

changes in competition and technology in the markets that we serve and the mix of our products required to address these changes;

changes in foreign currency exchange rates;

political, economic, and health (including pandemics) instabilities;

instability or disruption caused by military hostilities in the regions or countries in which we operate (including Israel);

difficulties in implementing our cost reduction strategies, such as underutilization of production facilities, labor unrest or legal challenges to our lay-off or termination plans, operation of redundant facilities due to difficulties in transferring production to achieve efficiencies;

compliance issues under applicable laws, such as export control laws, including the outcome of our voluntary self-disclosure of export control non-compliance;

our ability to execute our new corporate strategy and business continuity, operational and budget plans;

and other factors affecting our operations, markets, products, services, and prices that are set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

We caution you not to place undue reliance on forward-looking statements, which speak only as of the date of this report or as of the dates otherwise indicated in such forward-looking statements.

We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes in the market risks previously disclosed in Part II, Item 7A “Quantitative and Qualitative Disclosures About Market Risk” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 25, 2025.

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