What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2025-11-18 compared with 2024-11-19 · 684 added, 659 removed, 916 unchanged (59% of the section changed)

3 unchanged sentences

Management recognizes that any controls and procedures, no matter how well designed, and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Based on this evaluation, the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO") have concluded that our disclosure controls and procedures were effective as of September 27, 2024.

Based on this evaluation, the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO") have concluded that our disclosure controls and procedures were effective as of October 3, 2025.

Management's Annual Report on Internal Control Over Financial Reporting

4 unchanged sentences

Accordingly, even effective internal controls and procedures can provide only reasonable assurance with respect to financial statement preparation and presentation.

Under the supervision and with the participation of our management, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of September 27, 2024.

Based on this evaluation, our management concluded that we maintained effective internal control over financial reporting as of September 27, 2024.

The effectiveness of our internal control over financial reporting as of September 27, 2024 has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their attestation report, which appears below in this Item 9A.

Under the supervision and with the participation of our management, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of October 3, 2025.

Based on this evaluation, our management concluded that we maintained effective internal control over financial reporting as of October 3, 2025.

The effectiveness of our internal control over financial reporting as of October 3, 2025 has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their attestation report, which appears below in this Item 9A.

Changes in Internal Control Over Financial Reporting

There were no changes to our internal control over financial reporting during the quarter ended September 27, 2024, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) under the Exchange Act).

There were no changes to our internal control over financial reporting during the quarter ended October 3, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) under the Exchange Act).

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

1 unchanged sentence

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Varex Imaging Corporation and subsidiaries (the “Company”) as of September 27, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of September 27, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended September 27, 2024, of the Company and our report dated November 19, 2024, expressed an unqualified opinion on those financial statements.

We have audited the internal control over financial reporting of Varex Imaging Corporation and subsidiaries (the “Company”) as of October 3, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of October 3, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended October 3, 2025, of the Company and our report dated November 18, 2025, expressed an unqualified opinion on those financial statements.

Basis for Opinion

18 unchanged sentences

Other Information

During the three months ended September 27, 2024, none of our directors or officers informed us of the adoption or termination of a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Regulation S-K, Item 408, except as follows:

On August 9, 2024, Sunny Sanyal , our President, CEO, and member of our Board of Directors , modified the Rule 10b5-1 trading arrangement he adopted on March 5, 2024 .

As initially adopted, the 10b5-1 trading arrangement (the “10b5-1 Plan”) provided for (i) the sale of shares of Company common stock owned by Mr.

Sanyal once per quarter in an amount not to exceed $100,000 in any single quarter, and not to exceed $300,000 in the aggregate during the term of the 10b5-1 Plan, with the aggregate number of shares to be sold during such term not to exceed 23,009 shares;

and (ii) the exercise, subject to pricing triggers, of up to 720,585 stock options (which includes options to be withheld by the Company in payment of the exercise prices and applicable taxes), that have vested or may vest to Mr.

Sanyal pursuant to previous awards, some of which expire in February 2025 .

The August 9, 2024 modification removes the sale of shares of Company common stock described above from the 10b5-1 Plan, but continues to include the exercise of 720,585 stock options.

Sanyal does not presently intend to sell the net shares he acquires pursuant to exercise of these options.

The 10b5-1 Plan, as modified, is intended to satisfy the affirmative defense of Rule 10b5-1(c).

Disclosures Regarding Foreign Jurisdictions that Prevent Inspections.

Revision of Prior Period Financial Statements

As disclosed in more detail in “Revision to Prior Period Financial Statements” in Note 1 to the Consolidated Financial Statements included in this Annual Report on Form 10-K, the financial statements include the correction of an error to previously issued financial statements that required a recovery analysis of incentive-based compensation received by our executive officers under the Varex Imaging Corporation Compensation Recovery Policy filed as Exhibit 97 to this Annual Report.

We have determined that no recovery of incentive-based compensation is required as the correction resulted in no changes to the performance metrics used to determine incentive-based compensation for executive officers during any of the applicable completed fiscal years.

Insider Trading Arrangements

During the three months ended October 3, 2025, none of our directors or officers informed us of the adoption, modification or termination of a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Regulation S-K, Item 408.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Not applicable.

Except as otherwise disclosed below, the information required by Items 10, 11, 12, 13 and 14 is incorporated by reference from our definitive proxy statement for the 2026 Annual Meeting of Stockholders.

Our definitive proxy statement for the 2025 Annual Meeting of Stockholders ("Proxy Statement") will be filed with the SEC no later than 120 days after September 27, 2024.

Our definitive proxy statement for the 2026 Annual Meeting of Stockholders ("Proxy Statement") will be filed with the SEC no later than 120 days after October 3, 2025.

Directors, Executive Officers and Corporate Governance.

4 unchanged sentences

The Code of Conduct is available on our website at http://www.vareximaging.com.

We intend to comply with the disclosure requirements of Item 5.05(c) of Form 8-K regarding an amendment to, or waiver from, a provision of the Code of Conduct that applies to our principal executive officer, principal financial officer, principal accounting officer or persons performing similar functions by posting such information on our website, specified above.

In the event of an amendment to, or waiver from, a provision of the Code of Conduct that applies to our principal executive officer, principal financial officer, principal accounting officer or persons performing similar functions, we intend to comply with the disclosure requirements of Item 5.05(c) of Form 8-k by posting such information on our website, specified above.

We will provide disclosure of delinquent Section 16(a) reports, if any, in our Proxy Statement, and such disclosure, if any, is incorporated herein by reference.

1 unchanged sentence

We have an Insider Trading Policy applicable to our directors, officers, employees and certain persons and entities that we believe is reasonably designed to promote compliance with insider trading laws, rules and regulations, and Nasdaq listing standards applicable to our Company.

The foregoing summary of our Insider Trading Policy is not complete and is qualified in its entirety by reference to the full text of our Insider Trading Policy attached hereto as Exhibit 19.1.

The foregoing summary of our Insider Trading Policy is not complete and is qualified in its entirety by reference to the full text of our Insider Trading Policy, which is filed as Exhibit 19.1 to this Annual Report on Form 10-K.

Executive Compensation

2 unchanged sentences

Equity Compensation Plan Information

The following table provides information as of September 27, 2024 with respect to the shares of our common stock that may be issued under our existing equity compensation plans.

The following table provides information as of October 3, 2025 with respect to the shares of our common stock that may be issued under our existing equity compensation plans.

Plan Category (amounts in thousands except per share data) Number of securities to be issued upon exercise of outstanding options, warrants and rights (1) (a)

2 unchanged sentences

Equity compensation plans approved by security holders 3,775 $ 25.61 5,279

Equity compensation plans not approved by security holders — — —

Total 3,767 $ 26.79 5,276

(1) Consists of stock options, restricted stock units ("RSUs"), and deferred stock units ("DSUs") granted under the Varex Imaging Corporation 2017 Omnibus Stock Plan and the 2020 Omnibus Stock Plan, as Amended and Restated (the "2020 Stock Plan").

(1) Consists of stock options, restricted stock units ("RSUs"), performance stock units ("PSUs") and deferred stock units ("DSUs") granted under the Varex Imaging Corporation 2017 Omnibus Stock Plan and the 2020 Omnibus Stock Plan, as Amended and Restated (the "2020 Stock Plan").

Excludes purchase rights under the ESPP.

(2) The weighted average exercise price does not take into account the shares issuable upon vesting of outstanding RSUs and DSUs, which have no exercise price.

(2) The weighted average exercise price does not take into account the shares issuable upon vesting of outstanding RSUs, PSUs, and DSUs, which have no exercise price.

(3) Includes 4,456 thousand shares available for future issuance under the 2020 Stock Plan, and also includes 823 thousand shares available for future issuance under the ESPP.

15 unchanged sentences

2.1* Separation and Distribution Agreement, dated as of January 27, 2017, by and between Varian and (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed January 30, 2017).

3.1* Amended and Restated Certificate of Incorporation, dated January 27, 2017 (as corrected December 11, 2017) (incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K filed November 27, 2018).

3.2* Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Varex Imaging Corporation, effective as of February 13, 2025 (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed February 1 4, 2025.)

3.3* Amended and Restated Bylaws of the Company, as amended February 11, 2021 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed February 16, 2021).

4.1 Information required by Item 202(a) through (d) and (f) of Regulation S-K for each class of Company securities that is registered under Section 12 of the Exchange Act.

4.2* Indenture, dated June 9, 2020, by and among Varex Imaging Corporation and Wells Fargo Bank, National Association, as Trustee, including form of 4.00% Convertible Senior Notes due 2025 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed June 9, 2020).

4.3* Indenture, dated as of September 30, 2020, by and among Varex Imaging Corporation, the Guarantors party thereto and Wells Fargo Bank, National Association, as trustee and collateral agent, including the form of 7.875% Senior Secured Notes due 2027 as Exhibit A (incorporated by reference to Exhibit 4.3 to the Company’s Current Report on Form 10-K filed November 30, 2021).

4.2* Senior Secured Notes Indenture, dated as of September 30, 2020, by and among Varex Imaging Corporation, the Guarantors party thereto and Wells Fargo Bank, National Association, as trustee and collateral agent, including the form of 7.875% Senior Secured Notes due 2027 as Exhibit A (incorporated by reference to Exhibit 4.3 to the Company’s Current Annual Report on Form 10-K filed November 30, 2020).

4.3* First Supplemental Indenture, dated as of December 20, 2024, by and among Varex Imaging Corporation, the Guarantors party thereto and Computershare Trust Company, N.A., in its capacity as successor trustee and successor notes collateral agent (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed December 23, 2024).

10.1* Tax Matters Agreement, dated as of January 27, 2017 by and between Varian and Company (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed January 30, 2017).

4 unchanged sentences

10.6*† Form of Restricted Stock Unit Award Agreement under the 2017 Omnibus Stock Plan (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed February 16, 2017).

10.7*† Varex Imaging Corporation 2017 Employee Stock Purchase Plan (incorporated by reference to Appendix A to the proxy statement filed by the Registrant on December 28, 2021).

10.8*† Varex Imaging Corporation Management Incentive Plan

10.7*† Varex Imaging Corporation 2017 Employee Stock Purchase Plan, as Amended (incorporated by reference to Appendix A to the proxy statement filed by the Registrant on December 30, 2024).

10.8*† Varex Imaging Corporation Management Incentive Plan (incorporated by reference to Exhibit 10.9 of the Company's Current Report on Form 8-K filed January 30, 2017).

10.9*† Form of Change in Control Agreement (incorporated by reference to Exhibit 10.11 to the Company’s Annual Report on Form 10-K filed November 19, 2021) .

6 unchanged sentences

10.14*† Form of Nonqualified Stock Option Agreement, Form of Restricted Stock Unit Agreement and Form of Grant Agreement – Deferred Stock Units under the Varex Imaging Corporation 2020 Omnibus Stock Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 14, 2020).

10.15* Form of Base Convertible Bond Hedge Confirmation, dated June 4, 2020, between Varex Imaging Corporation and each of the counterparties thereto (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed June 9, 2020).

10.16* Form of Base Warrant Confirmation, dated June 4, 2020, between Varex Imaging Corporation and each of the counterparties thereto (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed June 9, 2020).

10.17* Form of Additional Convertible Bond Hedge Confirmation, dated June 5, 2020, between Varex Imaging Corporation and each of the counterparties thereto (incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed June 9, 2020).

10.18* Form of Additional Warrant Confirmation, dated June 5, 2020, between Varex Imaging Corporation and each of the Counterparties (incorporated by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed June 9, 2020).

10.15*† Form of Performance Unit Agreement under the 2020 Omnibus Stock Plan (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed November 17, 2023).

2 unchanged sentences

DBA Zions First National bank, as administrative and collateral agent, and the lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed March 27, 2024).

10.22* Equipment Credit Agreement dated as of April 26, 2024, by and among the Company, Varex Imaging West, LLC, certain guarantors party thereto and Zions Bancorporation, N.A.

DBA Zions Credit Corporation (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed May 2, 2024).

10.18* Amendment No.

1 to Revolving Credit and Guarantee Agreement, dated August 30, 2024, made and entered into by and among Varex Imaging Corporation, Varex Imaging West, LLC, Varex Imaging Deutschland AG, the other Loan Parties party thereto and Zions Bancorporation, N.A.

DBA Zions First National Bank, as administrative and collateral agent for the lenders party thereto.

19.1 Varex Imaging Corporation Insider Trading Policy

21.1 List of Subsidiaries as of September 27, 2024

DBA Zions First National Bank, as administrative and collateral agent for the lenders party thereto (incorporated by reference to Exhibit 10.23 to the Company’s Annual Report on Form 10-K filed November 19, 2024).

10.19* Amendment No.

2 to Revolving Credit and Guaranty Agreement among the Company, Varex Imaging West, LLC, Varex Imaging Deutschland AG, the other Loan Parties party thereto and Zions Bancorporation, N.A.

DBA Zions First National Bank (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed December 17, 2024).

10.20† Executive Transition, Separation and Release Agreement, dated as of September 5, 2025, by and between Varex Imaging Corporation and Kimberley E.

19.1* Varex Imaging Corporation Insider Trading Policy (incorporated by reference to Exhibit 19.1 to the Company’s Annual Report on Form 10-K filed November 19, 2024).

21.1 List of Subsidiaries as of October 3, 2025

23.1 Consent of Deloitte & Touche LLP, Independent Registered Public Accounting Firm

24.1 Power of Attorney (included on signature page)

31.1 Chief Executive Officer Certification Pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act.

4 unchanged sentences

Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

97.1 Varex Imaging Corporation Compensation Recovery Policy

97.1* Varex Imaging Corporation Compensation Recovery Policy (incorporated by reference to Exhibit 97.1 to the Company’s Annual Report on Form 10-K filed November 19, 2024).

101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

17 unchanged sentences

Signature Capacity Date

SANYAL President and Chief Executive Officer and Director (Principal Executive Officer)

SANYAL President and Chief Executive Officer and Director

(Principal Executive Officer)

November 18, 2025

4 unchanged sentences

/s/ WALTER M ROSEBROUGH, JR.

Chairman of the Board November 19, 2024

Chair of the Board November 18, 2025

Walter M Rosebrough, Jr.

10 unchanged sentences

Report of Independent Registered Public Accounting Firm (PCAOB ID No.

Consolidated Statements of Operations for the fiscal years ended 2024, 2023, and 2022

Consolidated Statements of Comprehensive (Loss) I ncome for the fiscal years ended 2024, 2023, and 2022

Consolidated Statements of Operations for the fiscal years en ded 2025 , 2024 , and 2023

Consolidated Statements of Comp rehensive (Loss) Income for th e fiscal ye ars ended 2025 , 2024 , and 2023

Consolidated Balance Sheets as of the end of fiscal years 2025 and 2024

5 unchanged sentences

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Varex Imaging Corporation and subsidiaries (the "Company") as of September 27, 2024 and September 29, 2023, the related consolidated statements of operations, comprehensive (loss) income, stockholders' equity, and cash flows, for each of the three years in the period ended September 27, 2024, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of September 27, 2024 and September 29, 2023, and the results of its operations and its cash flows for each of the three years in the period ended September 27, 2024, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of September 27, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated November 19, 2024, expressed an unqualified opinion on the Company's internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 1 to the financial statements, the Company changed its method of accounting for Convertible Notes effective October 1, 2022, due to the adoption of Accounting Standards Update, 2020-06, Debt — Debt With Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity , using the modified retrospective approach.

We have audited the accompanying consolidated balance sheets of Varex Imaging Corporation and subsidiaries (the "Company") as of October 3, 2025 and September 27, 2024, the related consolidated statements of operations, comprehensive (loss) income, stockholders' equity, and cash flows, for each of the three years in the period ended October 3, 2025, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of October 3, 2025 and September 27, 2024, and the results of its operations and its cash flows for each of the three years in the period ended October 3, 2025, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of October 3, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated November 18, 2025, expressed an unqualified opinion on the Company's internal control over financial reporting.

Basis for Opinion

23 unchanged sentences

• We tested the effectiveness of controls over the valuation of excess and obsolete inventories.

The controls we tested included those over the calculation, accuracy and completeness of underlying data used in the calculation, including historical sales and anticipated future sales by product, product quantities on hand, and applicable prices.

The controls we tested included those over the calculation and the accuracy and completeness of underlying data used in the calculation, including historical sales and anticipated future sales by product, product quantities on hand, and applicable prices.

• We evaluated management’s ability to accurately estimate the valuation of excess and obsolete inventories by comparing actual inventory write-downs to management’s historical estimates.

7 unchanged sentences

The evaluation includes consideration of qualitative factors including industry and market considerations, overall financial performance, and other relevant events and factors affecting the reporting unit.

In the fourth quarter of 2024, the Company performed a quantitative impairment analysis to determine the fair values of its reporting units.

As a result of various changes in circumstances, the Company performed a quantitative impairment analysis to determine the fair value of its reporting units during the fiscal quarter ended July 4, 2025.

The Company used both an income approach utilizing the discounted cash flow method and a market approach utilizing the public company market multiple method.

No impairment was recognized for any reporting unit, as the fair value of each reporting unit exceeded its carrying value as of the measurement date.

We identified the valuation of the Medical reporting unit as a critical audit matter because of the significant judgments and estimates management made to determine the fair value of the reporting unit.

As a result of the impairment test, the Company determined that the carrying amount of the Medical reporting unit was below its fair value, and the Company recorded a $93.9 million goodwill impairment charge to its Medical reporting unit.

We identified the valuation of the Medical reporting unit performed as of July 4, 2025 as a critical audit matter because of the significant judgments and estimates management made to determine the fair value of the reporting unit.

This required a high degree of auditor judgment and an increased extent of effort when performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to selection of the discount rate and forecasts of future revenues used in determining the fair value of the Medical reporting unit, including the need to involve our fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to management’s estimates and assumptions for selection of the discount rate and forecasts of future revenues in determining the fair value of the Medical reporting unit included the following, among others:

• We tested the effectiveness of controls over management’s goodwill impairment evaluation, including those over the determination of the fair value of the Medical reporting unit, such as controls related to management’s estimates and assumptions for the selection of the discount rate and forecasts of future revenues.

12 unchanged sentences

Revenues, net $ 844.6 $ 811.0 $ 893.4

$ 811.0 $ 893.4 $ 859.4

Cost of revenues 554.1 554.1 603.1

554.1 603.1 575.9

Gross profit 290.5 256.9 290.3

1 unchanged sentence

Research and development 91.1 87.0 84.8

87.0 84.8 77.0

Selling, general, and administrative 133.3 137.8 128.4

137.8 128.4 118.3

Impairment of goodwill 93.9 — —

Total operating expenses 318.3 224.8 213.2

224.8 213.2 195.3

Operating income 32.1 77.1 88.2

Operating (loss) income ( 27.8 ) 32.1 77.1

Interest income 8.5 7.3 3.7

Interest expense ( 35.5 ) ( 30.2 ) ( 29.3 )

( 30.2 ) ( 29.3 ) ( 39.8 )

Other expense, net ( 4.4 ) ( 4.2 ) ( 20.2 )

Interest and other expense, net ( 31.4 ) ( 27.1 ) ( 45.8 )

Income before taxes 5.0 31.3 44.5

(Loss) income before taxes ( 59.2 ) 5.0 31.3

Income tax expense (benefit) 10.7 53.3 ( 16.6 )

13 unchanged sentences

Net (loss) income $ ( 69.9 ) $ ( 48.3 ) $ 47.9

Other comprehensive (loss) income, net of tax

Unrealized gain (loss) on defined benefit obligations — ( 1.0 ) 1.4

Income (loss) on forward contracts 0.1 0.1 ( 0.6 )

Unrealized income (loss) on available-for-sale securities 0.1 0.1 ( 0.1 )

Other comprehensive loss

Unrealized loss on defined benefit obligations — — ( 1.0 )

Gain on forward contracts 0.1 0.1 0.1

Unrealized (loss) gain on available-for-sale securities ( 0.1 ) 0.1 0.1

Foreign currency translation adjustments ( 2.3 ) ( 1.9 ) ( 0.5 )

5 unchanged sentences

CONSOLIDATED BALANCE SHEETS

(In millions, except share amounts)

September 27, 2024 September 29, 2023

(In millions, except share and per share amounts) October 3, 2025 September 27, 2024

Current assets:

Cash and cash equivalents $ 145.0 $ 168.7

$ 168.7 $ 152.6

Marketable securities 10.1 31.8

Accounts receivable, net of allowance for credit losses of $ 1.0 million and $ 0.6 million at September 27, 2024 and September 29, 2023, respectively

Accounts receivable, net of allowance for credit losses of $ 2.1 million and $ 1.0 million at October 3, 2025 and September 27, 2024, respectively

Inventories, net 299.4 264.8

21 unchanged sentences

Total liabilities 620.8 670.4

Commitments and contingencies (Note 13)

Stockholders' equity:

4 unchanged sentences

Shares issued and outstanding:

41,094,179 and 40,529,573 at September 27, 2024 and September 29, 2023, respectively

41,689,672 and 41,094,179 at October 3, 2025 and September 27, 2024, respectively

Additional paid-in capital 483.3 467.2

Accumulated other comprehensive loss ( 5.2 ) ( 2.9 )

Retained earnings

(Accumulated deficit) retained earnings ( 5.9 ) 64.4

Total Varex stockholders' equity 472.6 529.1

2 unchanged sentences

Total liabilities and stockholders' equity $ 1,107.4 $ 1,213.6

$ 1,217.0 $ 1,249.6

See accompanying Notes to the Consolidated Financial Statements.

1 unchanged sentence

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss) Retained Earnings Total Varex Equity Noncontrolling Interests Total Stockholders' Equity

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive income (loss) Retained Earnings (Accumulated Deficit) Total Varex Equity Noncontrolling Interests Total Stockholders' Equity

(In millions) Shares Amount

October 1, 2021 39.4 $ 0.4 $ 449.4 $ — $ 33.5 $ 483.3 $ 13.2 $ 496.5

September 30, 2022 40.1 $ 0.4 $ 469.1 $ 0.1 $ 59.7 $ 529.3 $ 13.3 $ 542.6

Net income — — — — 47.4 47.4 0.5 47.9

Cumulative effect of accounting change — — ( 34.6 ) — 6.1 ( 28.5 ) — ( 28.5 )

Exercise of stock options — — 0.2 — — 0.2 — 0.2

Common stock issued upon vesting of restricted shares 0.2 — — — — — — —

Shares withheld on vesting of restricted shares ( 0.1 ) — ( 2.8 ) — — ( 2.8 ) — ( 2.8 )

Shares withheld on vesting of restricted stock ( 0.1 ) — ( 1.4 ) — — ( 1.4 ) — ( 1.4 )

Common stock issued under employee stock purchase plan 0.3 — 3.9 — — 3.9 — 3.9

Share-based compensation — — 13.5 — — 13.5 — 13.5

Unrealized loss on forward contracts — — — ( 0.6 ) — ( 0.6 ) — ( 0.6 )

Unrealized loss on change in fair value of available-for-sale securities — — — ( 0.1 ) — ( 0.1 ) — ( 0.1 )

Unrealized gain on defined benefit obligations, net of tax — — — 1.4 — 1.4 — 1.4

Realized gain on forward contracts — — — 0.1 — 0.1 — 0.1

Unrealized gain on change in fair value of available-for-sale securities — — — 0.1 — 0.1 — 0.1

Unrealized loss on defined benefit obligations, net of tax — — — ( 1.0 ) — ( 1.0 ) — ( 1.0 )

Foreign currency translation adjustments — — — ( 0.5 ) — ( 0.5 ) — ( 0.5 )

1 unchanged sentence

September 29, 2023 40.5 $ 0.4 $ 450.4 $ ( 1.2 ) $ 113.2 $ 562.8 $ 13.3 $ 576.1

Net income — — — — 48.2 48.2 0.5 48.7

Cumulative effect of accounting change — — ( 34.6 ) — 6.1 ( 28.5 ) — ( 28.5 )

Exercise of stock options — — 0.2 — — 0.2 — 0.2

Net (loss) income — — — — ( 48.8 ) ( 48.8 ) 0.5 ( 48.3 )

Common stock issued upon vesting of restricted shares 0.4 — — — — — — —

Shares withheld on vesting of restricted shares ( 0.1 ) — ( 1.4 ) — — ( 1.4 ) — ( 1.4 )

Shares withheld on vesting of restricted stock ( 0.1 ) — ( 2.2 ) — — ( 2.2 ) — ( 2.2 )

Common stock issued under employee stock purchase plan 0.3 — 3.8 — — 3.8 — 3.8

2 unchanged sentences

Unrealized gain on change in fair value of available-for-sale securities — — — 0.1 — 0.1 — 0.1

Unrealized loss on defined benefit obligations, net of tax — — — ( 1.0 ) — ( 1.0 ) — ( 1.0 )

Foreign currency translation adjustments — — — ( 1.9 ) — ( 1.9 ) — ( 1.9 )

Business acquisitions — — — — — — 0.7 0.7

Other — — — — — — ( 0.4 ) ( 0.4 )

2 unchanged sentences

Common stock issued upon vesting of restricted shares 0.4 — — — — — — —

Shares withheld on vesting of restricted shares ( 0.1 ) — ( 2.2 ) — — ( 2.2 ) — ( 2.2 )

Shares withheld on vesting of restricted stock ( 0.1 ) — ( 1.9 ) — — ( 1.9 ) — ( 1.9 )

Common stock issued under employee stock purchase plan 0.3 — 3.3 — — 3.3 — 3.3

1 unchanged sentence

Realized gain on forward contracts — — — 0.1 — 0.1 — 0.1

Unrealized gain on change in fair value of available-for-sale securities — — — 0.1 — 0.1 — 0.1

Business acquisitions — — — — — — 0.7 0.7

Unrealized loss on change in fair value of available-for-sale securities — — — ( 0.1 ) — ( 0.1 ) — ( 0.1 )

Foreign currency translation adjustments — — — ( 2.3 ) — ( 2.3 ) — ( 2.3 )

Other — — ( 0.1 ) — — ( 0.1 ) ( 0.5 ) ( 0.6 )

September 27, 2024 41.1 $ 0.4 $ 467.2 $ ( 2.9 ) $ 70.4 $ 535.1 $ 14.1 $ 549.2

October 3, 2025 41.7 $ 0.4 $ 483.3 $ ( 5.2 ) $ ( 5.9 ) $ 472.6 $ 14.0 $ 486.6

See accompanying Notes to the Consolidated Financial Statements

13 unchanged sentences

Gain on purchase of business — ( 2.1 ) —

Impairment of goodwill 93.9 — —

Inventory write-down 3.8 4.9 5.6

Loss on operating lease abandonment — — 1.9

Other, net ( 1.8 ) 1.5 3.0

1 unchanged sentence

Accounts receivable 0.1 6.7 9.8

Inventories 6.6 20.2 ( 85.0 )

Inventories, net ( 39.9 ) 6.6 20.2

Prepaid expenses and other assets ( 3.6 ) 3.3 7.0

6 unchanged sentences

Loss on settlement of cash flow hedge — — ( 0.2 )

Proceeds from sales of marketable debt securities 11.5 — —

Proceeds from maturities of marketable debt securities 50.5 58.8 28.3

3 unchanged sentences

Proceeds from maturities of certificates of deposit 3.4 1.8 —

Acquisitions of businesses, net of cash acquired 0.9 ( 1.0 ) —

Settlement of net investment hedge ( 0.8 ) — 7.0

Proceeds from sales of business and assets — — 1.7

Investments in and loans to privately-held companies — — ( 0.6 )

Other ( 1.1 ) ( 2.4 ) ( 1.4 )

Net cash used in investing activities ( 27.5 ) ( 44.9 ) ( 48.4 )

Acquisitions of businesses, net of cash acquired — 0.9 ( 1.0 )

Other, net ( 0.8 ) ( 1.1 ) ( 2.4 )

Net cash provided by (used in) investing activities 10.3 ( 27.5 ) ( 44.9 )

Cash flows from financing activities:

Taxes related to net share settlement of equity awards

( 1.9 ) ( 2.2 ) ( 1.4 )

Proceeds from issuance of senior secured notes 126.9 — —

Repayments of borrowings ( 201.9 ) ( 1.6 ) ( 2.4 )

Proceeds from exercise of stock options

Payment of debt issuance costs

( 1.2 ) ( 2.3 ) —

Proceeds from shares issued under employee stock purchase plan

Proceeds from exercise of stock options — 0.2 3.8

Taxes related to net share settlement of equity awards ( 2.2 ) ( 1.4 ) ( 2.8 )

Other financing activities ( 1.0 ) ( 0.5 ) ( 0.3 )

Other, net ( 1.1 ) ( 1.0 ) ( 0.5 )

Net cash used in financing activities ( 75.9 ) ( 3.3 ) ( 0.2 )

Effects of exchange rate changes on cash and cash equivalents and restricted cash

Net increase (decrease) in cash and cash equivalents and restricted cash 16.4 63.4 ( 55.5 )

0.6 ( 0.1 ) 0.1

Net (decrease) increase in cash and cash equivalents and restricted cash

( 23.3 ) 16.4 63.4

Cash and cash equivalents and restricted cash at beginning of period

170.4 154.0 90.6

Cash and cash equivalents and restricted cash at end of period

$ 147.1 $ 170.4 $ 154.0

Supplemental cash flow information:

Cash paid for interest $ 31.3 $ 27.6 $ 27.4

Cash paid for income tax, net of refunds 20.2 16.7 2.2

Income taxes paid, net of refunds 18.6 20.2 16.7

Supplemental non-cash activities:

9 unchanged sentences

The Company generally sells security and inspection products to OEM customers who incorporate Varex’s products into their inspection or irradiation systems and processes.

The Company also manufactures and sells its own X-ray imaging systems for industrial applications.

The Company conducts an active research and development program to focus on new technologies and applications in both medical and industrial X-ray imaging.

3 unchanged sentences

All intercompany balances and transactions have been eliminated in consolidation.

Reclassification of Prior Period Presentation

Certain prior period amounts in the Financial Statements and the Notes to the Consolidated Financial Statements have had a change in presentation to conform to current period presentation.

This change does not affect previously reported results.

Revision of Prior Period Financial Statements

During the third quarter of 2025, the Company identified an accounting error related to its deferred tax assets and liabilities and income tax expense calculations in prior periods.

The Company has revised its prior period Consolidated Statements of Operations, Consolidated Statements of Comprehensive (Loss) Income, Consolidated Balance Sheets, Consolidated Statements of Stockholders' Equity, and Consolidated Statements of Cash Flows to correct this error.

The Company evaluated the effect of the error on the previously issued Consolidated Financial Statements and determined that the related impacts were not material, individually or in aggregate.

However, correcting the cumulative effect of the errors as out-of-period adjustments would be material for the current year.

As such the Company has corrected these errors in the Consolidated Financial Statements for all prior periods presented herein.

The following tables provide a reconciliation of the revisions for the previously reported Consolidated Statements of Operations, Consolidated Statements of Comprehensive (Loss) Income, Consolidated Statements of Stockholders' Equity, and Consolidated Statements of Cash Flows as of the fiscal years ended September 27, 2024 and September 29, 2023 and the revisions for the previously reported Consolidated Balance Sheets as of the fiscal year ended September 27, 2024.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per share amounts) As Previously Reported Revision As Revised As Previously Reported Revision As Revised

Income tax expense (benefit) $ 52.2 $ 1.1 $ 53.3 $ ( 17.4 ) $ 0.8 $ ( 16.6 )

Net (loss) income ( 47.2 ) ( 1.1 ) ( 48.3 ) 48.7 ( 0.8 ) 47.9

Net (loss) income attributable to Varex ( 47.7 ) ( 1.1 ) ( 48.8 ) 48.2 ( 0.8 ) 47.4

Net (loss) income per common share attributable to Varex

Basic $ ( 1.17 ) $ ( 0.03 ) $ ( 1.20 ) $ 1.20 $ ( 0.02 ) $ 1.18

Diluted $ ( 1.17 ) $ ( 0.03 ) $ ( 1.20 ) $ 1.08 $ ( 0.01 ) $ 1.07

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(In millions) As Previously Reported Revision As Revised As Previously Reported Revision As Revised

Net (loss) income $ ( 47.2 ) $ ( 1.1 ) $ ( 48.3 ) $ 48.7 $ ( 0.8 ) $ 47.9

Total comprehensive (loss) income ( 48.9 ) ( 1.1 ) ( 50.0 ) 47.4 ( 0.8 ) 46.6

Comprehensive (loss) income attributable to Varex ( 49.4 ) ( 1.1 ) ( 50.5 ) 46.9 ( 0.8 ) 46.1

CONSOLIDATED BALANCE SHEETS

September 27, 2024

(In millions) As Previously Reported Revision As Revised

Deferred tax assets $ 4.7 $ ( 3.4 ) $ 1.3

Total assets 1,217.0 ( 3.4 ) 1,213.6

Deferred tax liabilities 1.4 2.6 4.0

Total liabilities 667.8 2.6 670.4

Retained earnings 70.4 ( 6.0 ) 64.4

Total Varex stockholders' equity 535.1 ( 6.0 ) 529.1

Total stockholders' equity 549.2 ( 6.0 ) 543.2

Total liabilities and stockholders' equity 1,217.0 ( 3.4 ) 1,213.6

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(In millions) Retained Earnings Total Varex Equity Total Stockholders' Equity

As Previously Reported

For the Year Ended September 29, 2023

Balance at September 30, 2022 $ 63.8 $ 533.4 $ 546.7

Net income 48.2 48.2 48.7

Balance at September 29, 2023 $ 118.1 $ 567.7 $ 581.0

For the Year Ended September 29, 2023

Balance at September 30, 2022 $ ( 4.1 ) $ ( 4.1 ) $ ( 4.1 )

Net loss ( 0.8 ) ( 0.8 ) ( 0.8 )

Balance at September 29, 2023 $ ( 4.9 ) $ ( 4.9 ) $ ( 4.9 )

For the Year Ended September 29, 2023

Balance at September 30, 2022 $ 59.7 $ 529.3 $ 542.6

Net income 47.4 47.4 47.9

Balance at September 29, 2023 $ 113.2 $ 562.8 $ 576.1

(In millions) Retained Earnings Total Varex Equity Total Stockholders' Equity

As Previously Reported

For the Year Ended September 27, 2024

Balance at September 29, 2023 $ 118.1 $ 567.7 $ 581.0

Net loss ( 47.7 ) ( 47.7 ) ( 47.2 )

Balance at September 27, 2024 $ 70.4 $ 535.1 $ 549.2

For the Year Ended September 27, 2024

Balance at September 29, 2023 $ ( 4.9 ) $ ( 4.9 ) $ ( 4.9 )

Net loss ( 1.1 ) ( 1.1 ) ( 1.1 )

Balance at September 27, 2024 $ ( 6.0 ) $ ( 6.0 ) $ ( 6.0 )

For the Year Ended September 27, 2024

Balance at September 29, 2023 $ 113.2 $ 562.8 $ 576.1

Net loss ( 48.8 ) ( 48.8 ) ( 48.3 )

Balance at September 27, 2024 $ 64.4 $ 529.1 $ 543.2

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions) As Previously Reported Revision As Revised As Previously Reported Revision As Revised

Cash flows from operating activities:

Net (loss) income $ ( 47.2 ) $ ( 1.1 ) $ ( 48.3 ) $ 48.7 $ ( 0.8 ) $ 47.9

Deferred taxes 37.0 1.1 38.1 ( 39.5 ) 0.8 ( 38.7 )

These revisions had no impact on gross profit, operating expenses, or operating income in any of the fiscal periods.

Segment Reporting

2 unchanged sentences

See Note 13, Segment Information, included in this report, for further information on the Company’s segments.

The fiscal years of the Company as reported are the 52 or 53-week period ending on the Friday nearest September 30.

Fiscal year 2024 was the 52-week period that ended September 27, 2024, fiscal year 2023 was the 52-week period that ended September 29, 2023, and fiscal year 2022 was the 52-week period that ended September 30, 2022.

The fiscal years of the Company as reported are the 52- or 53-week periods ending on the Friday nearest September 30.

Fiscal year 2025 was the 53-week period that ended October 3, 2025, fiscal year 2024 was the 52-week period that ended September 27, 2024, and fiscal year 2023 was the 52-week period that ended September 29, 2023.

Variable Interest Entities

1 unchanged sentence

If the Company is the primary beneficiary of a variable interest entity, the assets, liabilities, and results of operations of the variable interest entity will be included in the Company’s consolidated financial statements.

As of September 27, 2024, the Company had variable interests in two entities, neither of which were consolidated by the Company.

As of October 3, 2025, the Company had variable interests in two entities, neither of which were consolidated by the Company.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting periods.

Such estimates include the valuation of inventories, valuation of goodwill and intangible assets, receivables, warranties, refund liabilities, long-lived

asset valuations, impairment of investments, valuation of financial instruments, and taxes on income.

Such estimates include the valuation of inventories, valuation of goodwill and intangible assets, receivables, warranties, refund liabilities, long-lived asset valuations, impairment of investments, valuation of financial instruments, and taxes on income.

Actual results could differ from these estimates.

2 unchanged sentences

Restricted Cash

Restricted cash primarily consists of cash collateral related to certain lease and inventory arrangements.

Restricted cash primarily consists of cash collateral related to certain leases and inventory arrangements.

Restricted cash is included in other assets on the Company's Consolidated Balance Sheets.

Cash and cash equivalents and restricted cash as reported within the Consolidated Statements of Cash Flows consisted of the following:

Twelve Months Ended September 27, 2024 Twelve Months Ended September 29, 2023

October 3, 2025 September 27, 2024

(In millions) Beginning of Period End of Period Beginning of Period End of Period

31 unchanged sentences

18.0 % 17.6 % 16.5 %

Canon Medical Systems Corporation accounted for 9.5 % and 13.8 % of the Company’s accounts receivable as of September 27, 2024 and September 29, 2023, respectively.

Canon Medical Systems Corporation accounted for 14.0 % and 9.5 % of the Company’s accounts receivable as of October 3, 2025 and September 27, 2024, respectively.

Inventories, net

4 unchanged sentences

The following table summarizes the Company’s inventories, net :

(In millions) September 27, 2024 September 29, 2023

(In millions) October 3, 2025 September 27, 2024

Raw materials and parts $ 228.1 $ 214.5

1 unchanged sentence

Finished goods 40.0 34.1

Total inventories $ 264.8 $ 277.5

The Company recorded inventory write-downs of $ 4.9 million, $ 5.6 million and $ 6.4 million for the twelve months ended September 27, 2024, September 29, 2023, and September 30, 2022, respectively.

Total inventories, net $ 299.4 $ 264.8

The Company recorded inventory write-downs of $ 3.8 million, $ 4.9 million, and $ 5.6 million in fiscal years ended 2025, 2024, and 2023, respectively.

Property, Plant and Equipment, net

11 unchanged sentences

The following table summarizes the Company’s property, plant, and equipment, net :

(In millions) September 27, 2024 September 29, 2023

(In millions) October 3, 2025 September 27, 2024

Land $ 8.6 $ 8.6

7 unchanged sentences

Equity Method Investments

The Company accounts for its equity investments in privately-held companies under the equity method of accounting if the Company has the ability to exercise significant influence in, but not control, these investments.

The Company records impairment losses on its equity method investments if an impairment exists and is deemed to be other-than-temporary, which is based on various factors, including but not limited to, the length of time the fair value of the investment is below the carrying value, the absence of an ability to recover the carrying amount of the investment, and the inability of the investee to sustain an earnings capacity that would justify the carrying amount of the investment.

6 unchanged sentences

Classification of marketable debt securities is determined at the time of purchase, and the Company reevaluates such classification as of each balance sheet date.

Marketable debt securities are recorded at estimated fair value and included in cash and cash equivalents, prepaid expenses and other current assets, and other assets within the Consolidated Balance Sheets.

Marketable debt securities are recorded at estimated fair value and included in cash and cash equivalents, marketable securities, and other assets within the Consolidated Balance Sheets.

Any unrealized gains or losses are included in accumulated other comprehensive loss within the Consolidated Balance Sheets.

When the fair value of a marketable debt security declines below its amortized cost basis, any portion of that decline attributable to credit losses, to the extent expected to be nonrecoverable before the sale of the security, is recognized in the Consolidated Statements of Operations.

When the fair value of a marketable debt security declines below its amortized cost basis due to changes in interest rates, such amounts are recorded in accumulated other comprehensive loss, and are recognized in the Consolidated Statements of Operations only if the Company sells or intends to sell the security before recovery of its cost basis.

There were no impairments related to marketable debt securities recorded during the twelve months ended September 27, 2024.

When the fair value of a marketable debt security declines below its amortized cost basis due to changes in interest rates, such amounts are recorded in other comprehensive loss and are recognized in the Consolidated Statements of Operations only if the Company sells or intends to sell the security before recovery of its cost basis.

There were no impairments related to marketable debt securities recorded during fiscal years 2025 and 2024.

Marketable Equity Securities

13 unchanged sentences

If the Company determines that a quantitative analysis is necessary, the Company performs a step one analysis, which consists of a comparison of the fair value of a reporting unit against its carrying amount, including the goodwill allocated to each reporting unit.

In fiscal years 2023 and 2022 the Company

performed the annual goodwill qualitative impairment test for our two reporting units and determined that, at those dates, it was not more likely than not that the fair values of the reporting units were less than their carrying amount and accordingly recorded no impairment.

In the fourth quarter of 2024, changes in facts and circumstances related to reduced demand of the Company's medical products, coupled with a sustained decrease in the Company's stock price, resulted in the Company determining that an indicator of possible impairment existed within its reporting units.

Accordingly, the Company performed a quantitative impairment analysis to determine the fair values of those reporting units, using both an income approach utilizing the discounted cash flow method and market approach utilizing the public company market multiple method.

Based on the output of the analysis, the Company determined that the fair values of both the Medical and Industrial reporting units exceeded their carrying amounts.

Accordingly, no impairment charges were recorded during the year ended September 27, 2024.

In fiscal years 2024 and 2023 the Company performed the annual goodwill qualitative impairment test for our two reporting units and determined that, at those dates, it was not more likely than not that the fair values of the reporting units were less than their carrying amount and accordingly recorded no impairment.

During fiscal year 2025, changes in facts and circumstances related to a sustained decrease in the Company's stock price, a decrease in its market capitalization, and downward revisions in its longer term forecast received during the quarter, which included the impact of tariffs and the China Ministry of Commerce ("MOFCOM") initiating two investigations related to medical products imported into China (the "MOFCOM Investigations"), which were temporarily suspended in May 2025 and August 2025 and indefinitely suspended in November 2025, resulted in the Company determining that an indicator of possible impairment existed within its reporting units.

Accordingly, in connection with the preparation of its financial statements for the three months ended July 4, 2025, the Company performed a quantitative impairment analysis to determine the fair values of those reporting units, using both an income approach utilizing the discounted cash flow method and a market approach utilizing the public company market multiple method.

Based on the output of the analysis, the Company determined that the carrying of its Medical reporting unit exceeded its fair value.

Accordingly, the Company recorded $ 93.9 million of impairment charge to its Medical reporting unit within impairment of goodwill in the Consolidated Statements of Operations.

See Note 5 Goodwill and Intangible Assets, for further details.

Loss Contingencies

From time to time, the Company is involved in legal proceedings, claims and government inspections or investigations, customs and duties audits, and other contingency matters, both inside and outside the United States, arising in the ordinary course of its business or otherwise.

From time to time, the Company is involved in legal proceedings, claims, and government inspections or investigations, customs and duties audits, and other contingency matters, both inside and outside the United States, arising in the ordinary course of

its business or otherwise.

The Company accrues amounts for probable losses, to the extent they can be reasonably estimated, that it believes are adequate to address any liabilities related to legal proceedings and other loss contingencies that the Company believes will result in a probable loss (including, among other things, probable settlement value).

1 unchanged sentence

When a loss contingency is probable but not reasonably estimable, the nature of the contingency and the fact that an estimate cannot be made is disclosed.

See Note 13, Commitments and Contingencies, for further information regarding certain of our contractual obligations and contingencies.

Supplier Finance Programs

4 unchanged sentences

The following table presents the change in the direct supplier financing obligation:

Fiscal Years Ended

(In millions) September 27, 2024 September 29, 2023

(In millions) October 3, 2025 September 27, 2024

Confirmed obligations outstanding at the beginning of the period $ 2.6 $ 4.2

7 unchanged sentences

The Company anticipates that it will be obligated to reimburse Varian for 20 % of the liabilities of Varian related to these sites (after adjusting for any insurance proceeds or tax benefits received by Varian).

As of September 27, 2024 and September 29, 2023, the Company's estimated liability for these sites was $ 3.9 million and $ 2.8 million, net of expected insurance proceeds, respectively.

As of October 3, 2025 and September 27, 2024, the Company's estimated environmental liability for these sites was $ 3.2 million and $ 3.9 million, net of expected insurance proceeds, respectively.

Product Warranty

2 unchanged sentences

The accrued warranty costs represent the best estimate at the time of sale of the total costs that the Company will incur to repair or replace product parts that fail while still under warranty.

The amount of the accrued estimated warranty costs obligation for established products is primarily based on historical experience as to product failures adjusted for current information on repair costs.

The amount of the accrued estimated warranty costs obligation for established products is primarily based on historical experience of product failures, adjusted for current information on repair costs.

For new products, estimates include the historical experience of similar products, as well as a reasonable allowance for warranty expenses associated with new products.

1 unchanged sentence

The following table reflects the changes in the Company’s accrued product warranty:

Fiscal Years Ended

(In millions) September 27, 2024 September 29, 2023

(In millions) October 3, 2025 September 27, 2024

Accrued product warranty, at beginning of period $ 10.8 $ 7.7

3 unchanged sentences

The Company determines if an arrangement is or contains a lease at the inception of an arrangement.

The Company's operating lease right-of-use ("ROU") assets represent the right to use an underlying asset over the lease term and lease liabilities represent its obligation to make lease payments arising from the lease.

The Company's operating lease right-of-use ("ROU") assets represent the right to use an underlying asset over the lease term and lease liabilities

represent its obligation to make lease payments arising from the lease.

ROU assets may also include initial direct costs incurred and prepaid lease payments, less lease incentives.

40 unchanged sentences

Revenue is disaggregated from contracts between geography and by reportable operating segment, which the Company believes best depicts how the nature, amount, timing, and uncertainty of revenues and cash flows are affected by economic factors.

Refer to Note 17, Segment Information, included in this report, for the disaggregation of the Company’s revenue based on reportable operating segments and disaggregated by geographic region.

Refer to Note 13, Segment Information , for the disaggregation of the Company’s revenue based on reportable operating segments and Note 2, Revenue , for the disaggregation of revenue by geographic region and country.

Contract Balances

13 unchanged sentences

On a quarterly basis, the Company considers historical trends, current information and any reasonable and supportable forecasts to determine if an amount should be included in the allowance for credit losses.

The Company had an allowance for credit losses of $ 1.0 million and $ 0.6 million as of September 27, 2024 and September 29, 2023, respectively.

The Company had an allowance for credit losses of $ 2.1 million and $ 1.0 million as of October 3, 2025 and September 27, 2024, respectively.

Share-Based Compensation Expense

6 unchanged sentences

Share-based compensation expense recognized in the Consolidated Statements of Operations includes compensation expense for the share-based payment awards based on the grant date fair value estimated in accordance with the guidance on share-based compensation.

The Company records forfeitures as they occur.

Company records forfeitures as they occur.

The Company attributes the value of share-based compensation to expense using the straight-line method.

24 unchanged sentences

The 2017 Tax Cuts and Jobs Act ("TCJA") included a provision requiring research and development expenditures to be capitalized for tax years beginning after December 31, 2021, which was effective for the Company starting in fiscal year 2023.

Because the Company has a significant amount of research and development expenditures, U.S.

taxable income and cash taxes are expected to be significantly higher over the next several years.

With the 2025 One Big Beautiful Bill Act ("OBBBA"), this provision will be repealed starting in fiscal year 2026.

As a result of this repeal, U.S.

taxable income and cash taxes are expected to be lower over the next several years.

Foreign Currency Remeasurement and Translation

6 unchanged sentences

Recently Adopted Accounting Pronouncements

In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.

The standard removed certain separation models in ASC 470-20 for convertible instruments, and, as a result, embedded conversion features are no longer separated from the host contract for convertible instruments with conversion features that are not required to be accounted for as derivatives under ASC 815.

These convertible debt instruments are accounted for as a single liability measured at amortized cost.

This results in the interest expense recognized for convertible debt instruments to be typically closer to the coupon interest rate.

Further, the ASU made amendments to the earnings per share (“EPS”) guidance in Topic 260 for convertible instruments, the most significant impact of which was requiring the use of the if-converted method for diluted EPS calculation, and no longer allowing the net share settlement method.

The Company adopted this ASU on October 1, 2022, using the modified retrospective method.

On the date of adoption, the Company recorded an entry to reduce additional paid-in capital by $ 34.6 million, increase long-term debt, net by $ 28.0 million, decrease deferred tax assets by $ 0.5 million, and increase retained earnings by $ 6.1 million for the after-tax impact of previously recognized amortization of the debt discount associated with the Company’s Convertible Notes (as defined herein).

The unamortized discount on the Company's Convertible Notes was derecognized in the first quarter of fiscal year 2023, which removed the amortization of the debt discount, and brought the effective interest rate closer to the coupon rate of 4.00 %.

The impact that the adoption of ASU 2020-06 has on the Company's net income per diluted share will depend on the amount of earnings in each period and could result in additional dilution.

In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs, which requires entities to provide qualitative and quantitative disclosures about their supplier finance programs, including a rollforward of related obligations.

The adoption of ASU 2022-04 did not affect the Company’s financial condition, results of operations, or cash flows as the guidance only requires additional disclosures.

We adopted this ASU effective September 30, 2023 on a retrospective basis, except for the amendment on rollforward information, which has been adopted on a prospective basis.

Recent Accounting Standards and Updates Not Yet Effective

In November 2023, the FASB issued ASU 2023-07, Improvements to Reportable Segment Disclosures.

ASU 2023-07 requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within the segment measure of profit or loss, an amount and description of its composition for other segment items to reconcile to segment profit or loss, and the title and position of the entity’s CODM.

ASU 2023-07 will be applied retrospectively and is effective for annual reporting periods in fiscal years beginning after December 15, 2023, and interim reporting periods in fiscal years beginning after December 31, 2024.

The Company is currently reviewing the impact that the adoption of ASU 2023-07 may have on its consolidated financial statements and disclosures.

ASU 2023-07 will be applied retrospectively and is effective for annual reporting periods in fiscal years beginning after December 15, 2023, and interim reporting periods in fiscal

years beginning after December 31, 2024.

The Company adopted this guidance beginning with this annual report and this guidance will be applied to interim periods starting in fiscal year 2026 on a retrospective basis.

Refer to Note 13, Segment Information, for our segment reporting disclosures.

Recent Accounting Standards or Updates Not Yet Effective

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses.

This standard responds to investor input by requiring public companies to disclose, in interim and annual reporting periods, additional information about certain expenses in the notes to the financial statements.

This standard is effective for annual periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027, but early adoption is permitted.

The Company is currently evaluating the impact of this standard on our disclosures.

In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topic 740):

3 unchanged sentences

The Company is currently evaluating ASU 2023-09 and does not expect it to have a material effect on its consolidated financial statements.

REVENUE RECOGNITION

Disaggregation of Revenue

Revenue is disaggregated from contracts by geographic region, country, and by reportable operating segment, which the Company believes best depicts how the nature, amount, timing, and uncertainty of revenues and cash flows are affected by economic factors.

The Company operates various manufacturing and marketing operations outside the United States.

The Company's products are sold in three geographic regions:

the Americas, EMEA, and APAC.

The Americas includes North America (primarily the United States) and Latin America.

EMEA includes Europe, the Middle East, India, and Africa.

APAC includes Asia (other than India) and Australia.

Revenues by region are based on the known final destination of products sold.

The following table disaggregates the Company’s revenue by geographic region:

(In millions) 2025 2024 2023

Americas $ 276.5 $ 266.5 $ 281.8

EMEA 284.8 280.3 290.7

APAC 283.3 264.2 320.9

Total revenues, net $ 844.6 $ 811.0 $ 893.4

The following table disaggregates the Company’s revenue by country:

(In millions) 2025 2024 2023

United States $ 254.9 $ 257.7 $ 275.1

Japan 143.5 118.1 156.6

China 128.3 118.0 146.8

317.9 317.2 314.9

Total revenues, net $ 844.6 $ 811.0 $ 893.4

(1) No individual country included in the Other category generated more than 10% of total revenues, net.

Refer to Note 13, Segment Information, for the disaggregation of the Company's revenue based on reportable operating segments.

Right of Return Assets and Refund Liabilities

1 unchanged sentence

Refund liabilities are included within the accrued liabilities and other current liabilities and other long-term liabilities in the Consolidated Balance Sheets.

The following tables summarize the changes in the right of return assets and refund liabilities for the twelve months ended September 27, 2024 and September 29, 2023:

The following tables summarize the changes in the right of return assets and refund liabilities for the fiscal years ended October 3, 2025 and September 27, 2024:

(In millions) Right of Return Assets

Balance at October 1, 2022 $ 25.4

Balance at September 29, 2023 $ 26.0

Costs recovered from product returns during the period ( 7.2 )

5 unchanged sentences

Right of return assets from shipments of products subject to return during the period 6.4

Adjustment for actual vs.

reserved product returns 0.8

Balance at September 27, 2024 $ 25.2

(In millions) Refund Liabilities

Balance at October 3, 2025 $ 24.9

(In millions) Refund Liabilities

Balance at September 29, 2023 $ 28.9

Release of refund liability included in beginning of year refund liability ( 8.0 )

7 unchanged sentences

reserved product returns 0.1

Balance at September 27, 2024 $ 28.0

Balance at October 3, 2025 $ 27.7

During fiscal year 2025, the Company recognized revenue of $ 7.9 million related to deferred revenue which existed at September 27, 2024.

3 unchanged sentences

See Note 1, Summary of Significant Accounting Policies, for details on the nature of the remaining performance obligations within these contracts and how they will be resolved.

The Company has operating and finance leases for office space, warehouse and manufacturing space, vehicles, and certain equipment.

The Company's lease agreements do not contain any material residual value guarantees, variable lease costs, bargain purchase options or restrictive covenants.

The Company does not have any lease transactions with related parties.

Leases with an initial term of 12 months or less are generally not recorded on the balance sheet and expense for these leases is recognized on a straight-line basis over the lease term.

The Company's leases have remaining lease terms of less than one year to approximately ninety-four years , some of which may include options to extend the leases for up to six years and some include options to terminate early.

These options have been included in the determination of the lease liability when it is reasonably certain that the option will be exercised.

Right-of-use assets represent the Company's right to use an underlying asset for the lease term, and lease liabilities represent the Company's obligation to make lease payments arising from the lease contract.

Operating lease liabilities and their corresponding

right-of-use assets are recorded based on the present value of fixed lease payments over the expected lease term.

The interest rate implicit in lease contracts is typically not readily determinable.

As such, the Company's incremental borrowing rate is based on a credit-adjusted risk-free rate, which best approximates a secured rate over a similar term of lease.

During the twelve months ended September 30, 2022, the Company recorded a loss due to abandonment of $ 1.9 million, which is included in selling, general and administrative on the Consolidated Statements of Operations.

The following table presents supplemental balance sheet information related to the Company's operating and finance leases:

(In millions) Balance Sheet Location September 27, 2024 September 29, 2023

Operating lease right-of-use assets Operating lease assets $ 28.3 $ 29.0

Finance lease right-of-use assets Property, plant and equipment, net 6.6 0.3

Operating lease liabilities (current) Current operating lease liabilities 4.0 3.8

Finance lease liabilities (current) Accrued liabilities and other current liabilities 0.4 0.1

Operating lease liabilities (non-current) Operating lease liabilities 23.0 23.1

Finance lease liabilities (non-current) Other long-term liabilities $ 5.9 $ 0.2

The following table presents the weighted average remaining lease term and discount rate information related to the Company's operating and finance leases:

September 27, 2024 September 29, 2023

Operating lease weighted average remaining lease term (in years) 7.9 7.8

Operating lease weighted average discount rate 8.0 % 7.9 %

Finance lease weighted average remaining lease term (in years) 13.9 3.6

Finance lease weighted average discount rate 6.1 % 4.7 %

The following table provides information related to the Company’s operating and finance leases:

(In millions) 2024 2023 2022

Total operating lease costs (1)

$ 6.3 $ 5.8 $ 6.4

Total finance lease costs $ 0.3 $ 0.2 $ 0.2

Operating cash flows from operating leases $ 5.9 $ 7.8 $ 7.3

Financing cash flows from finance leases 0.5 0.3 0.2

Total cash paid for amounts included in the measurement of lease liabilities $ 6.4 $ 8.1 $ 7.5

Non-cash operating right-of-use assets obtained in exchange for new lease liabilities $ 5.4 $ 10.6 $ 5.4

Non-cash finance right-of-use assets obtained in exchange for new lease liabilities 6.5 0.2 0.1

Total right-of-use assets obtained in exchange for new lease liabilities $ 11.9 $ 10.8 $ 5.5

(1) Includes variable and short-term lease expense, which were immaterial for fiscal years 2024, 2023, and 2022.

As of September 27, 2024, maturities of operating lease and finance lease liabilities for each of the following five years and a total thereafter were as follows:

(In millions)

Fiscal Years:

Operating Leases Finance Leases

2025 $ 5.8 $ 0.8

Thereafter 15.3 6.0

Total future lease payments $ 37.5 $ 9.4

imputed interest ( 10.5 ) ( 3.1 )

Present value of lease liabilities $ 27.0 $ 6.3

As of September 27, 2024 , the Company had not entered into any material leases that have not yet commenced.

RELATED-PARTY TRANSACTIONS

6 unchanged sentences

The loss on the equity investment in dpiX Holding is included in other expense, net in the Consolidated Statements of Operations.

The carrying value of the equity investment in dpiX Holding was $ 24.8 million and $ 25.8 million at September 27, 2024 and September 29, 2023, respectively.

The carrying value of the equity investment in dpiX Holding was $ 22.5 million and $ 24.8 million at October 3, 2025 and September 27, 2024, respectively.

During fiscal year 2023, the Company recorded an impairment of its investment in dpiX Holding of $ 16.4 million.

3 unchanged sentences

These purchases of glass transistor arrays are included as a component of inventories, net on the Consolidated Balance Sheets or cost of revenues in the Consolidated Statements of Operations.

As of September 27, 2024 and September 29, 2023, the Company had accounts payable to dpiX totaling $ 3.0 million and $ 2.7 million, respectively.

As of October 3, 2025 and September 27, 2024, the Company had accounts payable to dpiX totaling $ 1.9 million and $ 3.0 million, respectively.

In October 2013, the Company entered into an amended agreement with dpiX and other parties that, among other things, provides it with the right to 50 % of dpiX’s total manufacturing capacity.

In addition, the Company is required to pay for 50 % of dpiX's fixed costs, as determined at the beginning of each calendar year.

In January 2024, the fixed cost commitment was determined and approved by the dpiX board of directors to be $ 12.4 million for calendar year 2024.

As of September 27, 2024, the Company estimated it has fixed cost commitments of $ 3.1 million related to the amended agreement through the remainder of calendar year 2024.

In January 2025, the Company's fixed cost commitment was determined and approved by the dpiX board of directors to be $ 13.7 million for calendar year 2025.

As of October 3, 2025, the Company estimated it has fixed cost commitments of $ 3.4 million related to the amended agreement with dpiX through the remainder of the calendar year 2025.

The amended agreement will continue unless the ownership structure of dpiX changes (as defined in the amended agreement).

5 unchanged sentences

KG (“VEC”), a joint venture formed to develop technology for use in X-ray imaging components.

In accordance with the VEC agreement,

net profits or losses are allocated to the members in accordance with their ownership interest.

In accordance with the VEC agreement, net profits or losses are allocated to the members in accordance with their ownership interest.

The Company's investment in VEC is accounted for under the equity method of accounting.

1 unchanged sentence

In fiscal years 2025, 2024, and 2023, the Company recorded a loss on the equity investment in VEC of $ 0.0 million, $ 0.1 million, and $ 0.4 million respectively.

The Company's investment in VEC was $ 2.0 million and $ 2.1 million as of September 27, 2024 and September 29, 2023, respectively.

The Company's investment in VEC was $ 2.0 million and $ 2.0 million as of October 3, 2025 and September 27, 2024, respectively.

In fiscal years 2025 and 2024, the Company had loans and other receivables from VEC of $ 0.8 million and $ 0.7 million, respectively, which are recorded in prepaid expenses and other current assets in the Consolidated Balance Sheets.

RESTRUCTURING

In July 2018, the Company committed to relocate the production of amorphous silicon glass for digital detectors from its Santa Clara facility to the dpiX fabrication facility in Colorado.

In July 2019, the Company committed to close its Santa Clara facility and to relocate the remaining production to its other existing facilities.

The Company ceased all operations at the Santa Clara facility as of October 2, 2020, and all activities related to the closure of the facility were completed by the end of December 2020.

Cash outflows associated with these restructuring charges are limited to employee termination expenses, facility closure and equipment sales and disposals.

Below is a detail of restructuring charges incurred during the 2024, 2023 and 2022 fiscal years, which predominately relate to the Company's Medical segment:

(In millions) Location of Restructuring Charges in Consolidated Statements of Operations 2024 2023 2022

Other assets impairment charges Selling, general and administrative $ — $ — $ 1.8

OTHER FINANCIAL INFORMATION

The following table summarizes the Company’s accrued liabilities and other current liabilities:

(In millions) September 27, 2024 September 29, 2023

Accrued compensation and benefits $ 30.0 $ 33.4

Product warranty 10.8 7.7

Taxes payable 8.1 13.3

Refund liability 7.5 7.2

Accrued interest 11.7 11.6

Other 10.5 9.4

Total accrued liabilities and other current liabilities $ 78.6 $ 82.6

The following table summarizes the Company’s other long-term liabilities:

(In millions) September 27, 2024 September 29, 2023

Long-term income tax payable $ 4.0 $ 4.6

Environmental liabilities 3.0 1.9

Defined benefit obligation liability 5.9 5.2

Long-term refund liability 20.5 21.7

Derivative liability 8.6 4.9

Long-term other 8.4 3.3

Total other long-term liabilities $ 50.4 $ 41.6

The following table summarizes the Company’s other expense, net:

(In millions) 2024 2023 2022

Loss from equity method investments $ ( 1.0 ) $ ( 1.4 ) $ ( 3.0 )

Gain on purchase of business 2.1 — —

Impairment of equity method investment — ( 16.4 ) —

Realized losses on foreign currencies, net ( 2.3 ) ( 1.0 ) ( 1.5 )

Other ( 3.0 ) ( 1.4 ) 0.2

Total other expense, net $ ( 4.2 ) $ ( 20.2 ) $ ( 4.3 )

NET (LOSS) INCOME PER SHARE

Basic net (loss) income per common share is computed by dividing the net (loss) income for the period by the weighted average number of shares of common stock outstanding during the reporting period.

Diluted net (loss) income per common share reflects the effects of potentially dilutive securities, which is computed by dividing the sum of net (loss) income and any adjustments to net income by the sum of the weighted average number of common shares outstanding and dilutive common shares.

A reconciliation of the numerator and denominator used in the calculation of basic and diluted net (loss) income per common share is as follows:

(In millions, except per share amounts)

2024 2023 2022

Net (loss) income per share – basic

Net (loss) income attributable to Varex $ ( 47.7 ) $ 48.2 $ 30.3

Basic weighted average shares outstanding

40.8 40.3 39.8

Basic net (loss) income per share attributable to Varex $ ( 1.17 ) $ 1.20 $ 0.76

Net (loss) income per share – diluted

Net (loss) income attributable to Varex $ ( 47.7 ) $ 48.2 $ 30.3

Interest expense on Convertible Notes, net of tax — 6.2 —

Diluted net (loss) income $ ( 47.7 ) $ 54.4 $ 30.3

Basic weighted average shares outstanding 40.8 40.3 39.8

Dilutive effect of Convertible Senior Notes — 9.6 1.3

Dilutive effect of share-based awards and other

Diluted weighted average shares outstanding

40.8 50.3 41.6

Diluted net (loss) income per share attributable to Varex $ ( 1.17 ) $ 1.08 $ 0.73

Anti-dilutive share summary

Share-based awards and other

Convertible notes 9.6 — —

Warrants 9.6 9.6 —

Total anti-dilutive shares 22.5 12.3 3.0

Potentially dilutive shares, which are based on the weighted-average shares of common stock underlying stock options, unvested stock awards, purchase rights granted under the employee stock purchase plan, warrants, and Convertible Notes using the treasury stock method or the if-converted method, as applicable, are included when calculating diluted net (loss) income per share attributable to Varex when their effect is dilutive.

As of October 1, 2022, the Company adopted ASU 2020-06 using the modified retrospective method.

The standard requires the Company to apply the if-converted method in relation to the Convertible Notes, which

requires the Company to assume that the Convertible Notes would have been converted using only share settlement at the beginning of the period, resulting in an additional 0 shares outstanding.

Using this method, the numerator is affected by adding back the after-tax interest expense and the denominator is affected by including the effect of potential share settlement, if the effect is dilutive.

Prior to the adoption of ASU 2020-06, the Convertible Notes were accounted for using the treasury stock method for purposes of net income per share.

See Note 1, Summary of Significant Accounting Policies, "Recently Adopted Accounting Pronouncements" for further details concerning the adoption of ASU 2020-06.

Furthermore, in connection with the offering of the Convertible Notes, the Company entered into convertible note hedges and warrants (see Note 9, Borrowings ).

However, the Company's convertible note hedges are not included when calculating potentially dilutive shares since their effect is always anti-dilutive.

FINANCIAL DERIVATIVES AND HEDGING ACTIVITIES

As part of the Company’s overall risk management practices, the Company enters into financial derivatives to manage its financial exposures to foreign currency exchange rates and interest rates.

The Company records all derivatives on the Consolidated Balance Sheets at fair value.

The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting, and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting.

A qualitative assessment of hedge effectiveness is performed on a quarterly basis, unless facts and circumstances indicate the hedge may no longer be highly effective, in which case the Company would test for effectiveness on a more frequent basis.

The changes in fair value for all trades that are not designated for hedge accounting are recognized in current period income.

The Company does not offset fair value amounts recognized for derivative instruments in its Consolidated Balance Sheets for presentation purposes.

Credit risk related to derivative transactions reflects the risk that a party to the transaction could fail to meet its obligation under the derivative contracts.

Therefore, the Company’s exposure to the counterparty’s credit risk is generally limited to the amounts, if any, by which the counterparty’s obligations to the Company exceed the Company’s obligations to the counterparty.

The Company’s policy is to enter into contracts only with financial institutions that meet certain minimum credit ratings to help mitigate counterparty credit risk.

Derivatives Designated as Hedging Instruments - Net Investment Hedges

The Company uses cross currency swap contracts as net investment hedges to manage its risk of variability in foreign currency-denominated net investments in majority-owned international operations.

All changes in fair value of the derivatives designated as net investment hedges are reported in accumulated other comprehensive loss along with the foreign currency translation adjustments on those investments.

During fiscal year 2023, the Company terminated all three of its previously outstanding cross currency swap contracts which resulted in cash received upon settlement of $ 7.3 million.

The gain on the cross currency swap contracts was recorded in accumulated other comprehensive loss where it will remain until such time that substantial liquidation of the international operations should occur.

Concurrent with the termination of the previous cross currency swap contracts, the Company entered into two new cross currency swap contracts which have been designated as net investment hedges.

As of September 27, 2024, the Company had the following outstanding derivatives designated as net investment hedging instruments:

(In millions, except for number of instruments)

Number of Instruments

Notional Value

Cross currency swap contracts

The following table summarizes the amount of pre-tax gain (loss) recognized from derivative instruments for the periods indicated and the line items in the accompanying statements of operations where the results are recorded for net investment hedges:

Amount of (Loss) or Gain Recognized in OCI on Derivatives

Fiscal Year Ended

Location of Gain or (Loss) Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing)

Amount of Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing)

Fiscal Year Ended

(In millions)

2024 2023 2022 2024 2023 2022

Cross currency swap contracts

$ ( 3.9 ) $ ( 4.4 ) $ 8.7 Interest expense $ 0.9 $ 0.9 $ 1.2

These derivative instruments are subject to master netting agreements giving effect to rights of offset with each counterparty.

None of the balances were eligible for netting.

The following table summarizes the gross fair values of derivative instruments as of the periods indicated and the line items in the accompanying Consolidated Balance Sheets where the instruments are recorded:

(In millions)

Derivative Assets and Liabilities

Derivatives Designated as Net Investment Hedges

Balance Sheet Location

Cross currency swap contracts

Prepaid expenses and other current assets $ 1.0 $ 0.7

Cross currency swap contracts Other long-term liabilities $ 8.6 $ 4.9

Balance Sheet Hedges

The Company also enters into foreign currency forward contracts to hedge fluctuations associated with foreign currency-denominated monetary assets and liabilities, primarily cash, lease contracts, third-party accounts receivable and payable, and intercompany accounts receivable and payables.

These forward contracts are generally entered into at the end of one fiscal period and expire by the end of the next fiscal period.

These forward contracts are not designated for hedge accounting treatment;

therefore, the change in fair value of these derivatives is recorded as a component of other expense, net in the Consolidated Statements of Operations and offsets the change in fair value of the foreign currency-denominated assets and liabilities, which are also recorded as a component of other expense, net.

The Company has not and does not intend to use derivative financial instruments for speculative or trading purposes.

The following table shows the notional amounts of outstanding foreign currency contracts as of September 27, 2024:

Notional Value of Derivatives not Designated as Hedging Instruments:

(In millions of equivalent USD) Buy Contracts Sell Contracts

Australian Dollar $ — $ 2.6

Chinese Renminbi — 31.8

Indian Rupee 1.2 —

Japanese Yen 7.8 —

Mexican Peso — 1.6

Swiss Franc 3.7 —

Philippine Peso 6.8 —

Total notional value $ 19.5 $ 56.7

The following table summarizes the Company's short-term and long-term debt:

September 27, 2024 September 29, 2023

(In millions, except for percentages) Amount Weighted-Avg Effective Interest Rate Amount Weighted-Avg Effective Interest Rate $ Change

Current maturities of long-term debt:

Convertible Senior Unsecured Notes $ 45.0 4.8 % $ — $ 45.0

Other debt 1.5 1.5 —

Total current maturities of long-term debt $ 46.5 $ 1.5 $ 45.0

Non-current maturities of long-term debt:

Convertible Senior Unsecured Notes (1)

$ 155.0 4.8 % $ 200.0 4.8 % $ ( 45.0 )

Senior Secured Notes 243.0 8.2 % 243.0 8.2 % —

Other debt 2.1 3.5 ( 1.4 )

Total non-current maturities of long-term debt $ 400.1 $ 446.5 $ ( 46.4 )

Unamortized issuance costs and debt discounts:

Unamortized issuance costs - Convertible Notes $ ( 1.0 ) $ ( 2.5 ) $ 1.5

Debt issuance costs - Senior Secured Notes ( 2.2 ) ( 2.9 ) 0.7

Total ( 3.2 ) ( 5.4 ) 2.2

Total debt outstanding, net $ 443.4 $ 442.6 $ 0.8

(1) This amount has been excluded from current liabilities as it is supported by the Revolving Credit Facility (as defined below) and is expected to remain outstanding for an uninterrupted period extending beyond one year from the balance sheet date.

Future principal payments of long-term debt outstanding as of September 27, 2024 are as follows:

(In millions)

Fiscal Years:

Total debt outstanding $ 446.6

current maturities of long-term debt ( 46.5 )

Non-current portion of long-term debt $ 400.1

The following table summarizes the Company's interest expense:

Twelve Months Ended

September 27, 2024 September 29, 2023 September 30, 2022

Contractual interest coupon and other $ 26.8 $ 26.7 $ 27.6

Amortization/extinguishment of debt issuance costs 3.4 2.6 3.4

Amortization of debt discounts — — 8.8

Total interest expense $ 30.2 $ 29.3 $ 39.8

Senior Secured Revolving Credit Facility

On March 26, 2024, the Company entered into a senior secured revolving credit agreement (the "Credit Agreement") providing for a senior secured revolving credit facility of up to $ 155.0 million (the “Revolving Credit Facility”).

Simultaneous with its entry into the Revolving Credit Facility, the Company terminated its $ 100.0 million asset-based loan revolving credit facility (the "ABL Facility"), dated as of September 30, 2020.

As of September 27, 2024, the Revolving Credit Facility remains undrawn.

The maximum availability under the Revolving Credit Facility is $ 155.0 million, which is available to the Company for revolving loans in U.S.

dollars and for the issuance of letters of credit.

The Company may make and repay borrowings from time to time until the maturity of the Revolving Credit Facility.

Borrowings under the Revolving Credit Facility will mature, and lending commitments thereunder will terminate, on September 26, 2027.

The interest rate for Revolving Credit Facility borrowings is the Secured Overnight Financing Rate (“SOFR”) (subject to a floor of 0.00 %) plus a margin of 2.00 % to 2.75 %, depending on the consolidated total net leverage ratio of the Company (as defined in the Credit Agreement).

Alternatively, the Company has the option of selecting a base rate equal to the highest of (a) the prime rate, (b) the Federal Funds Rate plus 0.50 % and (c) the one-month SOFR (subject to a floor of 0.00 %) plus a margin of 1.00 %.

An unused commitment fee of 0.375 % per annum was payable from March 26, 2024 until June 28, 2024, and thereafter an unused commitment fee of between 0.30 % to 0.40 % per annum is payable quarterly on the actual daily unused portion of the Revolving Credit Facility, depending on the consolidated total net leverage ratio of the Company.

Debt issuance costs, including unamortized deferred costs for continuing lenders under the previously existing ABL Facility, of $ 2.3 million were capitalized and are included within other assets on the Consolidated Balance Sheets.

These costs are being amortized over the term of the new agreement and are being recorded within interest expense in the Consolidated Statements of Operations.

The Credit Agreement contains customary covenants restricting the Company’s activities, as well as those of its subsidiaries, including limitations on the ability to sell assets, engage in mergers, or other fundamental changes, enter into capital leases or certain leases not in the ordinary course of business, enter into transactions involving related parties or derivatives, incur or prepay indebtedness, grant liens or negative pledges on its assets, make loans or other investments, pay dividends or repurchase stock or other securities, guarantee third-party obligations, engage in sale leasebacks, and make changes in its corporate structure, though there are certain exceptions and carveouts related to these restrictions.

One such covenant involves maintaining compensating cash balances.

The Company must maintain the lesser of an average quarterly balance of $ 80.0 million and 80 % of the U.S.

cash availability in certain deposit accounts;

provided that the amounts maintained must not be less than $ 80.0 million prior to June 30, 2025.

The compensating balances may be withdrawn but the availability of the Revolving Credit Facility is dependent upon maintenance of such compensating balances.

In addition, the Credit Agreement includes financial covenants related to the Company’s consolidated total net leverage ratio and its consolidated fixed charge coverage ratio.

The Company’s obligations under the Revolving Credit Facility are guaranteed by the Company and a number of Company subsidiaries.

These guarantees are secured on a first lien basis by specified assets, including inventory, accounts receivable, cash, intercompany accounts and loans, and certain real property.

In addition, the Revolving Credit Facility is secured by second liens on certain assets securing the Company’s 7.875 % Senior Secured Notes due 2027.

An intercreditor agreement governs how the collateral securing the respective debt obligations will be treated among the secured parties.

Equipment Credit Agreement

On April 26, 2024, the Company entered into a secured delayed draw term loan credit agreement (the “Equipment Credit Agreement”), providing for a secured equipment credit facility of up to $ 20.0 million (the “Equipment Credit Facility”).

As of September 27, 2024, there was no principal balance outstanding under the Equipment Credit Facility.

The maximum availability under the Equipment Credit Facility is $ 20.0 million, available to the Company for delayed draw term loans drawn on or before June 30, 2025, in U.S.

The Company may make and repay borrowings from time to time until the maturity of the Equipment Credit Facility, but once repaid, loans may not be reborrowed.

The Company may make voluntary prepayments of borrowings at any time.

Borrowings under the Equipment Credit Facility will mature on September 26, 2027.

interest rate for borrowings by the Company under the Equipment Credit Facility is the SOFR (subject to a floor of 0.00 %) plus a margin of 2.00 % to 2.75 %, depending on the consolidated total net leverage ratio of the Company.

Alternatively, Equipment Borrowers have the option of selecting a base rate equal to the highest of (a) the prime rate, (b) the Federal Funds Rate plus 0.50 % and (c) SOFR (subject to a floor of 0.00 %) plus a margin of 1.00 %, in each case plus a margin of 1.00 % to 1.75 %, depending on the consolidated total net leverage ratio of the Company.

A commitment fee of 0.375 % per annum was paid from April 26, 2024 until June 28, 2024, and thereafter a commitment fee of between 0.30 % to 0.40 % per annum is payable quarterly on the actual daily unused portion of the Equipment Credit Facility, depending on the consolidated total net leverage ratio of the Company.

The proceeds of the Equipment Credit Facility will be used for purchases of eligible equipment and associated software costs for the Company and its subsidiaries.

The Company’s obligations under the Equipment Credit Agreement are secured by the equipment and associated software financed by the Equipment Credit Facility and are guaranteed by a number of Company subsidiaries on an unsecured basis.

The Equipment Credit Agreement contains customary covenants restricting the Company’s activities, as well as those of its subsidiaries, including limitations on the ability to sell financed equipment or all or substantially all assets, engage in mergers or other fundamental changes, grant liens or negative pledges on financed equipment, make changes in its corporate structure, though there are certain exceptions and carveouts related to these restrictions.

In addition, the Equipment Credit Agreement includes financial covenants related to the Company’s consolidated total net leverage ratio and its consolidated fixed charge coverage ratio.

Convertible Senior Unsecured Notes

On June 9, 2020, Varex issued $ 200.0 million in aggregate principal amount of 4.00 % convertible senior unsecured notes due 2025 (“Convertible Notes”).

The net proceeds from the issuance of the Convertible Notes, after deducting transaction fees and offering expense payable by the Company, were approximately $ 193.1 million.

The Convertible Notes bear interest at the annual rate of 4.00 %, payable semiannually on June 1 and December 1 of each year, beginning on December 1, 2020, and will mature on June 1, 2025, unless earlier converted or repurchased by Varex.

The Convertible Notes are convertible into cash, shares of Varex common stock or a combination thereof, at Varex’s election, at an initial conversion rate of 48.048 shares of common stock per $1,000 principal amount of Convertible Notes, which is equivalent to an initial conversion price of approximately $ 20.81 per share, subject to adjustment pursuant to the terms of the indenture governing the Convertible Notes.

The Convertible Notes may be converted at any time after, and including, December 15, 2024, until the close of business on the second scheduled trading day immediately before the maturity date.

The maximum number of shares issuable upon conversion of the Convertible Notes is 9.6 million.

In accordance with the applicable accounting standards, a short-term debt obligation should be excluded from current liabilities if the entity has both the intent and ability to refinance the obligation on a long-term basis.

The intent and ability can be demonstrated by the issuance of a long-term obligation to refinance the short-term obligation on a long-term basis after the date of an entity’s balance sheet but before that balance sheet is issued.

Due to the entry into the Revolving Credit Facility, the Company classified $ 155.0 million of debt outstanding as of September 27, 2024 as long-term debt, net of current portion.

The remaining principal amount totaling $ 45.0 million is classified as current portion of long-term debt as of September 27, 2024.

On June 4, 2020 and June 5, 2020, in connection with the offering of the Convertible Notes, Varex entered into privately negotiated convertible note hedge transactions (collectively, the “Hedge Transactions”).

The Hedge Transactions cover, subject to customary anti-dilution adjustments, the number of shares of Varex common stock that initially underlie the Convertible Notes.

The Hedge Transactions are expected generally to reduce the potential dilution and/or offset any cash payments Varex is required to make in excess of the principal amount due upon conversion of the Convertible Notes in the event that the market price of Varex common stock is greater than the strike price of the Hedge Transactions, which was initially $ 20.81 per share (subject to adjustment under the terms of the Hedge Transactions).

The strike price of $ 20.81 corresponds to the initial conversion price of the Convertible Notes.

The number of shares underlying the Hedge Transactions is 9.6 million.

On June 4, 2020 and June 5, 2020, Varex also entered into privately negotiated warrant transactions (collectively, the “Warrant Transactions” and, together with the Hedge Transactions, the “Call Spread Transactions”), whereby the Company sold warrants at a higher strike price relating to the same number of shares of Varex common stock that initially underlie the Convertible Notes, subject to customary anti-dilution adjustments.

The initial strike price of the warrants is $ 24.975 per share (subject to adjustment under the terms of the Warrant Transactions), which is 50 % above the last reported sale price of Varex common stock on June 4, 2020.

The Warrant Transactions could have a dilutive effect to the Company's stockholders to the extent that the market price per share of Varex common stock, as measured under the terms of the Warrant Transactions, exceeds the applicable strike price of the

The number of shares underlying the Warrant Transactions is 9.6 million.

The number of warrants outstanding as of September 27, 2024, was 9.6 million.

Senior Secured Notes

Varex issued $ 300.0 million aggregate principal amount of 7.875 % Senior Secured Notes due 2027 (the "Senior Secured Notes") pursuant to an indenture dated September 30, 2020, among Varex, certain of its direct or indirect wholly-owned subsidiaries as guarantors, and Wells Fargo Bank, National Association as trustee and collateral agent.

Interest payments are paid semiannually on April 15 and October 15 of each year, beginning on April 15, 2021.

The Senior Secured Notes are secured by a first priority lien on substantially all of the assets of Varex and the assets and capital stock of its subsidiary guarantors (subject to exceptions), except for assets for which a first priority security interest is pledged for the Revolving Credit Facility, in which the Senior Secured Notes will have a second lien security interest.

The Senior Secured Notes include negative covenants, subject to certain exceptions, restricting or limiting Varex's ability and the ability of its restricted subsidiaries to, among other things, incur liens on collateral;

sell certain assets;

incur additional indebtedness;

pay dividends;

issue preferred shares;

consolidate, merge, or sell all or substantially all of its assets;

and enter into certain transactions with their affiliates.

On July 15, 2021, the Company redeemed $ 30 million of Senior Secured Notes, in accordance with the terms and conditions of the governing indenture, by paying cash of $ 31.5 million, inclusive of the redemption premium and accrued interest, and recognized a $ 1.4 million loss related to the redemption premium and the write-off of previously recorded debt issuance costs.

The redemption price of the redeemed notes was 103 % of the principal amount, plus accrued and unpaid interest from, and including, April 15, 2021 to, but excluding, the redemption date of July 15, 2021.

On March 18, 2022, the Company redeemed $ 27 million of Senior Secured Notes, in accordance with the terms and conditions of the governing indenture, by paying cash of $ 28.7 million, inclusive of the redemption premium and accrued interest, and recognized a $ 1.2 million loss related to the redemption premium and the write-off of previously recorded debt issuance costs.

The redemption price of the redeemed notes was 103 % of the principal amount, plus accrued and unpaid interest from, and including, October 15, 2021 to, but excluding, the redemption date of March 18, 2022.

As of September 27, 2024, the aggregate principal amount of the outstanding Senior Secured Notes was $ 243.0 million.

Asset-Based Loan

On September 30, 2020, the Company entered into a revolving credit agreement consisting of a $ 100.0 million asset-based loan revolving credit facility.

On March 26, 2024, the Company terminated the ABL Facility and recognized $ 0.6 million of the remaining unamortized issuance costs in interest expense in the Consolidated Statements of Operations, which excludes costs related to lenders that continued under the Revolving Credit Facility.

There was no principal balance outstanding under the ABL Facility when it was terminated.

BUSINESS COMBINATIONS

As of September 29, 2023, the Company, through two of its consolidated subsidiaries, Varex Imaging Deutschland AG and MeVis Medical Solutions AG ("MeVis Medical"), held a combined ownership interest in MeVis BreastCare GmbH and MeVis BreastCare Gmbh & Co KG (referred to in combination as "MeVis Breastcare") of 37.6 %.

Because the Company had the ability to exercise significant influence in, but not control, over MeVis Breastcare, it was historically accounted for as an equity method investment.

During the first quarter of fiscal year 2024, the Company increased its ownership in MeVis Breastcare to 87.1 % for a purchase price of $ 0.9 million, resulting in the Company now holding a controlling interest in MeVis Breastcare.

The purchase of this additional ownership interest was accounted for as a business combination achieved in stages, or step acquisition.

As a result, the previously held equity interest was remeasured to its acquisition-date fair value, with a gain of $ 0.9 million recognized in Other expense, net in the Consolidated Statements of Operations.

The assets and liabilities of MeVis Breastcare were then recorded on the Company's balance sheet at their fair values in accordance with ASC 805, and a gain on bargain purchase of $ 1.2 million was recorded during the first quarter of fiscal year 2024 in Other expense, net in the Consolidated Statements of Operations.

Because the purchase price did not give consideration to the other assets of the business, the fair value of the ownership interest acquired exceeded the price paid to the third party partial owner and this resulted in a gain on bargain purchase.

The following table summarizes the consideration paid for MeVis Breastcare and the amounts of the assets acquired and liabilities assumed recognized at their estimated acquisition date fair values, as well as the estimated fair value at the acquisition date of the noncontrolling interest in MeVis Breastcare.

(in millions)

Consideration paid

Fair value of total consideration transferred 0.9

Remeasurement of previous equity interest

Carrying value of previous equity interest before acquisition 1.1

Fair value of previous equity interest at acquisition date 2.0

Remeasurement gain recorded on previous equity interest 0.9

Total of consideration paid and fair value of previous equity interest $ 2.9

Recognized amounts of identifiable assets acquired and liabilities assumed

Cash and cash equivalents $ 1.8

Accounts receivable, net 1.2

Intangible assets, net 2.6

Accounts payable ( 0.1 )

Accrued liabilities and other current liabilities ( 0.6 )

Other long-term liabilities ( 0.1 )

Total identifiable net assets 4.8

Noncontrolling interest in MeVis Breastcare ( 0.7 )

Bargain purchase gain ( 1.2 )

Assets/Liabilities Measured at Fair Value on a Recurring Basis

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The fair values of certain of the Company’s financial instruments, including bank deposits included in cash and cash equivalents, accounts receivable, net and accounts payable, approximate their fair values due to their short maturities.

As of September 27, 2024, the fair value of the Company's Convertible Notes and Senior Secured Notes, as defined in Note 9, Borrowings and measured using Level 1 inputs, were $ 197.7 million and $ 247.6 million, respectively.

As of September 29, 2023, the fair values of the Company's Convertible Notes and Senior Secured Notes, measured using Level 1 inputs, were $ 228.4 million and $ 243.6 million, respectively.

The fair values of the Company’s Senior Secured Notes, as defined in Note 6, Borrowings and measured using Level 1 inputs, and as of October 3, 2025 and September 27, 2024 was $ 375.8 million and $ 247.6 million respectively.

The Company has elected to use the income approach to value its derivative instruments using standard valuation techniques and Level 2 inputs, such as currency spot rates, forward points and credit default swap spreads.

In the tables below, the Company has segregated all assets and liabilities that are measured at fair value on a recurring basis into the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the measurement date.

Fair Value Measurements at September 27, 2024

(In millions)

Quoted Prices in Active Markets

Fair Value at October 3, 2025

(In millions) Quoted Prices in Active Markets

Significant Other

1 unchanged sentence

Significant Unobservable Inputs

Money market funds $ — $ 24.4 $ — $ 24.4

Commercial paper $ — $ 2.0 $ — $ 2.0

Corporate notes/bonds — 4.0 — 4.0

Government agencies — 2.0 — 2.0

US treasury bills — 6.1 — 6.1

Certificates of deposit — 0.9 — 0.9

Derivative assets

treasury bills — 15.8 — 15.8

Deferred compensation plan (1)

5 unchanged sentences

(1) The assets held under the Company’s deferred compensation plan are classified in Level 1, as they relate primarily to publicly traded mutual funds for which there are observable market prices in active markets.

Fair Value Measurements at September 29, 2023

(In millions)

Quoted Prices in Active Markets

Fair Value at September 27, 2024

(In millions) Quoted Prices in Active Markets

Significant Other

2 unchanged sentences

Money market funds $ — $ 24.4 $ — $ 24.4

Commercial paper — 6.0 — 6.0

Corporate notes/bonds — 16.5 — 16.5

Government agencies — 18.3 — 18.3

US treasury bills — 28.6 — 28.6

treasury bills — 6.1 — 6.1

Certificates of deposit — 0.9 — 0.9

Derivative assets — 1.0 — 1.0

6 unchanged sentences

Nonrecurring Fair Value Measurements

In fiscal year 2023, the Company assessed its equity method investment in dpiX Holding for impairment and concluded that the carrying value of the investment was greater than its fair value.

The nonrecurring fair value measurements used by the Company to impair its equity method investment in dpiX Holding was calculated by equal weighting of the income approach based on estimated discounted future cash flows and the market approach based on comparable publicly traded companies in similar lines of businesses.

During fiscal year 2025, the Company assessed its goodwill for impairment and concluded that the carrying value of the Medical reporting unit was greater than its fair value.

The nonrecurring fair value measurements used by the Company to determine the impairment of the Medical reporting unit goodwill was calculated by equal weighting of the income approach based on estimated discounted future cash flows and the market approach based on comparable publicly traded companies in similar lines of businesses.

Under the income approach, fair value is determined based on a discounted cash flow technique that uses estimates of cash flows discounted to present value using rates commensurate with the risks associated with those cash flows.

Under the market approach, a market-based value is derived by relating multiples for earnings and cash flow measures for a group of comparable public companies to the same measure for each reporting unit to estimate fair value.

Under the market approach, a market-based value is derived by relating multiples of revenue for a group of comparable public companies to the same measure for

each reporting unit to estimate fair value.

This valuation resulted in a Level 3 nonrecurring fair value measurement.

See Note 1, Summary of Significant Accounting Policies, for details on the nature of the impairment.

See Note 5, Goodwill and Intangible Assets , for further information on the nature of the impairment.

Marketable Debt Securities

The following is a summary of marketable debt securities, which are included within the cash and cash equivalents, marketable securities, and other assets balances on the Consolidated Balance Sheets.

September 27, 2024

(In millions) Amortized Costs Unrealized Gains Fair Value

October 3, 2025

(In millions) Amortized Costs Unrealized Losses Fair Value

Commercial paper $ 2.0 $ — $ 2.0

Corporate notes/bonds 4.1 ( 0.1 ) 4.0

US treasury bills 6.1 — 6.1

treasury bills 15.8 — 15.8

Government agencies 2.0 — 2.0

Certificates of deposit 0.9 — 0.9

Total marketable debt securities $ 23.9 $ ( 0.1 ) $ 23.8

The following table summarizes the marketable debt securities on the Consolidated Balance Sheets as of September 29, 2023.

September 27, 2024

(In millions) Amortized Costs Fair Value

Commercial paper $ 6.0 $ 6.0

(In millions) Amortized Costs Unrealized Gains Fair Value

Corporate notes/bonds $ 16.4 $ 0.1 $ 16.5

US treasury bills 28.6 28.6

treasury bills 6.1 — 6.1

Government agencies 18.3 — 18.3

Certificates of deposit 0.9 — 0.9

Total marketable debt securities $ 41.7 $ 0.1 $ 41.8

The contractual maturities of marketable debt securities as of September 27, 2024, are shown in the table below.

The contractual maturities of marketable debt securities as of October 3, 2025, are shown in the table below.

Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations.

September 27, 2024

October 3, 2025

(In millions) Amortized Costs Fair Value

1 unchanged sentence

Due within one year $ 23.9 $ 23.8

Due after one year through five years 8.9 9.0

Total marketable debt securities $ 23.9 $ 23.8

During the twelve months ended September 27, 2024, there were no gross realized gains or losses from the sale of certain marketable debt securities that were reclassified out of accumulated other comprehensive loss.

The following tables summarizes the balance sheet locations for marketable debt securities:

September 27, 2024

(In millions) Commercial Paper Corporate Notes/Bonds Government Agencies Treasury Bills Certificates of Deposit Total

During the fiscal year ended October 3, 2025, there were no gross realized gains or losses from the sale of certain marketable debt securities that were reclassified out of accumulated other comprehensive loss.

The following tables summarize the balance sheet locations for marketable debt securities:

October 3, 2025

(In millions) Commercial Paper Corporate Notes/Bonds Government Agencies Treasury Bills Total

Cash and cash equivalents $ — $ — $ — $ 13.7 $ 13.7

Marketable securities 2.0 4.0 2.0 2.1 10.1

Other assets — 6.0 2.0 1.0 — 9.0

Total marketable debt securities $ 2.0 $ 4.0 $ 2.0 $ 15.8 $ 23.8

September 27, 2024

(In millions) Commercial Paper Corporate Notes/Bonds Government Agencies Treasury Bills Total

(In millions) Corporate Notes/Bonds Government Agencies Treasury Bills Certificates of Deposit Total

Cash and cash equivalents $ — $ — $ 1.0 $ — $ 1.0

Marketable securities 10.5 16.3 4.1 0.9 31.8

Other assets 6.0 2.0 1.0 — 9.0

Total marketable debt securities $ 16.5 $ 18.3 $ 6.1 $ 0.9 $ 41.8

GOODWILL AND INTANGIBLE ASSETS

The following table reflects goodwill by reportable segment:

(In millions)

The following table reflects goodwill by reportable operating segment:

(In millions) Medical Industrial Total

Balance at September 27, 2024 $ 173.0 $ 118.0 $ 291.0

Impairment of goodwill ( 93.9 ) — ( 93.9 )

Foreign currency translation adjustments 0.7 0.6 1.3

Balance at September 27, 2024 $ 173.0 $ 118.0 $ 291.0

Balance at October 3, 2025 $ 79.8 $ 118.6 $ 198.4

Medical Industrial Total

Balance at October 3, 2025

Goodwill $ 173.7 $ 118.6 $ 292.3

Accumulated impairment losses ( 93.9 ) — ( 93.9 )

Total goodwill $ 79.8 $ 118.6 $ 198.4

The Company performs its annual goodwill impairment test as of the beginning of the fourth quarter of each fiscal year or whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount.

Refer to Note 1, Summary of Significant Accounting Policies, for further details concerning our annual goodwill impairment evaluation.

During the three months ended July 4, 2025, the Company identified triggering events in its Industrial and Medical reporting units due to a sustained decline in its market capitalization, a sustained decline in its stock price, and downward revisions in its longer-term forecast received during the quarter, which included the impact of tariffs and MOFCOM Investigations announcements.

As a result, in connection with the preparation of its financial statements for the three months ended July 4, 2025, the Company performed a quantitative impairment analysis for goodwill related to its Medical and Industrial reporting units.

The fair value of the reporting units were determined using both an income approach utilizing the discounted cash flow method and market approach utilizing the public company market multiple method.

Based on this analysis, the Company determined that the carrying amount of the Medical reporting unit exceeded fair value, and recorded a goodwill impairment charge of $ 93.9 million to its Medical reporting unit within impairment of goodwill in the Consolidated Statements of Operations.

Additionally, based on the output of the analysis, the Company determined that the fair value of the Industrial reporting unit exceeded its carrying amount.

Accordingly, no impairment charge was recorded relating to its Industrial reporting unit.

The goodwill within the Medical reporting unit remains susceptible to future impairment charges.

Any significant adverse change in the Company's near- or long-term projections or macroeconomic conditions would result in future impairment charges for the Medical reporting unit.

The following table reflects the gross carrying amount and accumulated amortization of the Company’s finite-lived intangible assets included in intangible assets, net in the Consolidated Balance Sheets:

September 27, 2024 September 29, 2023

(In millions)

Gross Carrying Amount Accumulated Amortization

Net Carrying Amount Gross Carrying Amount Accumulated Amortization

Net Carrying Amount

October 3, 2025 September 27, 2024

(In millions) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount

Acquired existing technology

7 unchanged sentences

Amortization expense for intangible assets was $ 4.0 million, $ 9.9 million, and $ 13.7 million in fiscal years 2025, 2024, and 2023, respectively.

As of September 27, 2024, the estimated future amortization expense of intangible assets with finite lives is as follows:

As of October 3, 2025 , the estimated future amortization expense of intangible assets with finite lives is as follows:

(In millions)

1 unchanged sentence

Thereafter 0.3

COMMITMENTS AND CONTINGENCIES

Lease Commitments

See Note 3 , Leases, included in this report, for additional information about the Company's lease commitments.

Other Commitments

See Note 4, Related-Party Transactions, included in this report, for additional information about the Company’s commitments to dpiX.

See Note 14 , Noncontrolling Interests, included in this report, for additional information about the Company’s commitment to the noncontrolling shareholders of MeVis.

The Company has an environmental liability of approximately $ 3.9 million as of September 27, 2024.

See Note 1, Summary of Significant Accounting Policies, included in the accompanying Notes to the Consolidated Financial Statements for additional information.

In fiscal year 2022, the Company entered into several agreements with a third-party company, whose stock is publicly traded on a foreign exchange.

Under these agreements, the Company will make certain milestone payments of up to $ 5 million upon achievement of specified milestones.

During fiscal years 2022, 2023 and 2024, the Company paid $ 1 million, $ 2 million, and $ 1 million respectively, to the third-party company, which was recorded in research and development in the Consolidated Statements of Operations.

The remaining milestone was achieved and paid in the first quarter of fiscal year 2025.

The Company enters into purchase agreements with its suppliers in the ordinary course of its business for the purchase of goods and services.

Some of these purchase agreements are non-cancellable and thus contractually obligate the Company to future cash payments.

The Company has non-cancellable supplier purchase obligations of approximately $ 6.7 million as of September 27, 2024.

Contingencies

The Company did not have any material contingent liabilities as of September 27, 2024 and September 29, 2023.

Legal expenses are expensed as incurred.

The following table summarizes the Company’s short-term and long-term debt:

October 3, 2025 September 27, 2024

(In millions, except for percentages) Amount Amount Contractual Interest Rate Effective Interest Rate

Current maturities of long-term debt:

Convertible Senior Unsecured Notes $ — $ 45.0 4.0 % 4.8 %

Other debt 1.5 1.5

Total current maturities of long-term debt $ 1.5 $ 46.5

Non-current maturities of long-term debt:

Convertible Senior Unsecured Notes (1)

$ — $ 155.0 4.0 % 4.8 %

Senior Secured Notes 368.0 243.0 7.9 % 8.2 %

Other debt 0.4 2.1

Total non-current maturities of long-term debt $ 368.4 $ 400.1

Unamortized issuance costs and debt discounts:

Unamortized issuance costs - Convertible Notes $ — $ ( 1.0 )

Unamortized issuance costs, net of debt premium - Senior Secured Notes ( 2.4 ) ( 2.2 )

Total unamortized issuance costs and debt discounts ( 2.4 ) ( 3.2 )

Total debt outstanding, net $ 367.5 $ 443.4

(1) This amount has been excluded from current liabilities as it is supported by the Revolving Credit Facility and restricted cash from the proceeds of the Senior Secured Notes Add On (as defined below), which are expected to remain outstanding for an uninterrupted period extending beyond one year from the balance sheet date.

Future principal payments of long-term debt outstanding as of October 3, 2025 are as follows:

(In millions)

Fiscal Years:

Total debt outstanding $ 369.9

current maturities of long-term debt ( 1.5 )

Non-current portion of long-term debt $ 368.4

The following table summarizes the Company’s interest expense:

(In millions) 2025 2024 2023

Contractual interest coupon and other $ 32.7 $ 26.8 $ 26.7

Amortization of debt issuance costs 2.8 3.4 2.6

Total interest expense $ 35.5 $ 30.2 $ 29.3

Senior Secured Revolving Credit Facility

As of October 3, 2025, the Revolving Credit Facility remains undrawn.

The maximum availability under the Revolving Credit Facility is $ 155.0 million, which is available to the Company for revolving loans in U.S.

dollars and for the issuance of letters of credit.

As of October 3, 2025, the amount available under the Revolving Credit Facility was $ 154.8 million.

The Company may make and repay borrowings from time to time until the maturity of the Revolving Credit Facility.

Borrowings under the Revolving Credit Facility will mature, and lending commitments thereunder will terminate, on September 26, 2027.

A Base Rate Loan also has an additional margin of 1.00 % to 1.75 %.

depending on the consolidated total net leverage ratio of the Company at that time.

These costs will be amortized over the term of the new agreement and will be recorded within interest expense in the Consolidated Statements of Operations.

One such covenant involves maintaining compensating cash balances.

The Company must maintain with the Cash Management Banks (as defined in the Credit Agreement) one or more accounts and/or Bank Products (as defined in the Credit Agreement) at least 80 % of its U.S.

cash availability.

The compensating balances may be

withdrawn but the availability of the Revolving Credit Facility is dependent upon maintenance of such compensating balances.

In addition, the Credit Agreement includes financial covenants related to the Company’s consolidated total net leverage ratio and its consolidated fixed charge coverage ratio.

The Company’s obligations under the Revolving Credit Facility are guaranteed by the Company and a number of Company subsidiaries.

These guarantees are secured on a first lien basis by specified assets, including inventory, accounts receivable, cash, intercompany accounts and loans, and certain real property.

In addition, the Revolving Credit Facility is secured by second liens on certain assets securing the Company’s 7.875 % Senior Secured Notes due 2027.

An intercreditor agreement governs how the collateral securing the respective debt obligations will be treated among the secured parties.

Equipment Credit Agreement

On December 20, 2024, the Company terminated the Equipment Credit Agreement and recognized $ 0.1 million of the remaining unamortized issuance costs in interest expense in the Consolidated Statements of Operations.

There was no principal balance outstanding under the Equipment Credit Facility when it was terminated.

Convertible Senior Unsecured Notes

On June 9, 2020, Varex issued $ 200.0 million in aggregate principal amount of 4.00 % Convertible Senior Unsecured Notes due 2025 (“Convertible Notes”).

The net proceeds from the issuance of the Convertible Notes, after deducting transaction fees and offering expense payable by the Company, were approximately $ 193.1 million.

The Convertible Notes bore interest at the annual rate of 4.00 %, payable semiannually on June 1 and December 1 of each year.

On June 1, 2025, the Convertible Notes matured and were settled using $ 200.0 million in cash.

On June 4, 2020 and June 5, 2020, Varex entered into privately negotiated warrant transactions (collectively, the “Warrant Transactions”), whereby the Company sold warrants at a higher strike price relating to the same number of shares of Varex common stock that initially underlie the Convertible Notes, subject to customary anti-dilution adjustments.

The initial strike price of the warrants is $ 24.975 per share (subject to adjustment under the terms of the Warrant Transactions), which was 50 % above the last reported sale price of Varex common stock on June 4, 2020.

The number of shares underlying the Warrant Transactions is 9.6 million.

The number of warrants outstanding as of October 3, 2025 was 9.6 million.

The warrants expire after a 90 day trading period (as described in the warrant agreements) that begins on September 2, 2025.

Senior Secured Notes

Varex issued $ 300.0 million aggregate principal amount of 7.875 % Senior Secured Notes due 2027 (the "Senior Secured Notes") pursuant to an indenture dated September 30, 2020.

Interest payments are paid semiannually on April 15 and October 15 of each year, beginning on April 15, 2021.

The Senior Secured Notes will mature on October 15, 2027, unless earlier redeemed or repurchased by Varex.

On July 15, 2021, we redeemed $ 30.0 million, and on March 18, 2022, we redeemed $ 27.0 million of the Senior Secured Notes.

On December 20, 2024, the Company issued an additional $ 125.0 million of Senior Secured Notes (the "Senior Secured Notes Add On") pursuant to the Base Indenture, as supplemented by a supplemental indenture, dated December 20, 2024.

The net proceeds from the Senior Secured Notes Add On after initial purchasers’ premium, commissions, estimated fees, accrued interest in arrears, and expenses of $ 1.1 million, were approximately $ 123.9 million.

The Company used the proceeds from the offering to repay a portion of the Convertible Notes on their maturity date of June 1, 2025.

As of October 3, 2025, the aggregate principal amount of the outstanding Senior Secured Notes was $ 368.0 million.

sell certain assets;

incur additional indebtedness;

pay dividends;

issue preferred shares;

consolidate, merge, or sell all or substantially all of its assets;

and enter into certain transactions with their affiliates.

NET (LOSS) INCOME PER SHARE

Basic net (loss) income per common share is computed by dividing the net (loss) income for the period by the weighted average number of shares of common stock outstanding during the reporting period.

A reconciliation of the numerator and denominator used in the calculation of basic and diluted net (loss) income per common share is as follows:

(In millions, except per share amounts)

2025 2024 2023

Net (loss) income per share - basic

Net (loss) income attributable to Varex $ ( 70.3 ) $ ( 48.8 ) $ 47.4

Basic weighted average shares outstanding

41.4 40.8 40.3

Basic net (loss) income per share attributable to Varex $ ( 1.70 ) $ ( 1.20 ) $ 1.18

Net (loss) income per share - diluted

Net (loss) income attributable to Varex $ ( 70.3 ) $ ( 48.8 ) $ 47.4

Interest expense on Convertible Notes, net of tax — — 6.2

Diluted net (loss) income $ ( 70.3 ) $ ( 48.8 ) $ 53.6

Basic weighted average shares outstanding 41.4 40.8 40.3

Dilutive effect of Convertible Notes — — 9.6

Dilutive effect of share-based awards and other — — 0.4

Diluted weighted average shares outstanding

41.4 40.8 50.3

Diluted net (loss) income per share attributable to Varex $ ( 1.70 ) $ ( 1.20 ) $ 1.07

Anti-dilutive share summary

Share-based awards and other

Convertible notes — 9.6 —

Warrants 9.6 9.6 9.6

Total anti-dilutive shares 13.0 22.5 12.3

The Company has operating and finance leases for office space, warehouse and manufacturing space, vehicles, and certain equipment.

The Company's lease agreements do not contain any material residual value guarantees, variable lease costs, bargain purchase options or restrictive covenants.

The Company does not have any lease transactions with related parties.

Leases with an initial term of 12 months or less are generally not recorded on the balance sheet and expense for these leases is recognized on a straight-line basis over the lease term.

The Company's leases have remaining lease terms of less than one year to approximately ninety-three years , some of which may include options to extend the leases for up to five years and some include options to terminate early.

These options have been included in the determination of the lease liability when it is reasonably certain that the option will be exercised.

Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of fixed lease payments over the expected lease term.

The interest rate implicit in lease contracts is typically not readily determinable.

As such, the Company's incremental borrowing rate is based on a credit-adjusted risk-free rate, which best approximates a secured rate over a similar term of lease.

The following table presents supplemental balance sheet information related to the Company's operating and finance leases:

(In millions) Balance Sheet Location October 3, 2025 September 27, 2024

Operating lease right-of-use assets Operating lease assets $ 29.4 $ 28.3

Finance lease right-of-use assets Property, plant, and equipment, net 5.7 6.6

Operating lease liabilities (current) Current operating lease liabilities 4.4 4.0

Finance lease liabilities (current) Accrued liabilities and other current liabilities 0.4 0.4

Operating lease liabilities (non-current) Operating lease liabilities 24.0 23.0

Finance lease liabilities (non-current) Other long-term liabilities 5.6 5.9

The following table presents the weighted average remaining lease term and discount rate information related to the Company's operating and finance leases:

October 3, 2025 September 27, 2024

Operating lease weighted average remaining lease term (in years) 7.7 7.9

Operating lease weighted average discount rate 7.2 % 8.0 %

Finance lease weighted average remaining lease term (in years) 13.2 13.9

Finance lease weighted average discount rate 6.1 % 6.1 %

The following table provides information related to the Company’s operating and finance leases:

(In millions) 2025 2024 2023

Total operating lease costs (1)

$ 6.2 $ 6.3 $ 5.8

Amortization of right-of-use assets $ 1.0 $ 0.3 $ 0.2

Interest on lease liabilities 0.4 — —

Total finance lease costs $ 1.4 $ 0.3 $ 0.2

Operating cash flows from operating leases $ 6.1 $ 5.9 $ 7.8

Operating cash flows from finance leases 0.4 — —

Financing cash flows from finance leases 0.6 0.5 0.3

Total cash paid for amounts included in the measurement of lease liabilities $ 7.1 $ 6.4 $ 8.1

Noncash operating right-of-use assets obtained in exchange for new lease liabilities $ 8.1 $ 5.4 $ 10.6

Noncash finance right-of-use assets obtained in exchange for new lease liabilities 0.2 6.5 0.2

Total right-of-use assets obtained in exchange for new lease liabilities $ 8.3 $ 11.9 $ 10.8

(1) Includes variable and short-term lease expense, which were immaterial for fiscal years 2025, 2024, and 2023.

As of October 3, 2025, maturities of operating lease and finance lease liabilities for each of the following five years and a total thereafter were as follows:

(In millions)

Fiscal years:

Operating Leases Finance Leases

2026 $ 6.2 $ 0.7

Thereafter 14.0 5.5

Total future lease payments $ 37.5 $ 8.7

imputed interest ( 9.1 ) ( 2.7 )

Present value of lease liabilities $ 28.4 $ 6.0

As of October 3, 2025 , the Company had not entered into any material leases that have not yet commenced.

FINANCIAL DERIVATIVES AND HEDGING ACTIVITIES

As part of the Company’s overall risk management practices, the Company enters into financial derivatives to manage its financial exposures to foreign currency exchange rates and interest rates.

The Company records all derivatives on the Consolidated Balance Sheets at fair value.

The changes in fair value for all trades that are not designated for hedge accounting are recognized in current period income.

The Company does not offset fair value amounts recognized for derivative instruments in its Consolidated Balance Sheets for presentation purposes.

Credit risk related to derivative transactions reflect the risk that a party to the transaction could fail to meet its obligation under the derivative contracts.

The Company’s policy is to enter into contracts only with financial institutions that meet certain minimum credit ratings to help mitigate counterparty credit risk.

Derivatives Designated as Hedging Instruments - Net Investment Hedges

The Company uses cross currency swap contracts as net investment hedges to manage its risk of variability in foreign currency-denominated net investments in wholly-owned international operations.

During fiscal year 2023, the Company terminated all three of its previously outstanding cross currency swap contracts which resulted in cash received upon settlement of $ 7.3 million.

Concurrent with the termination of the previous cross currency swap contracts, the Company entered into two new cross currency swap contracts which have been designated as net investment hedges.

As of October 3, 2025, the Company had the following outstanding derivatives designated as net investment hedging instruments:

(In millions, except number of instruments) Number of Instruments Notional Value

Cross currency swap contracts 2 $ 51.8

The following table summarizes the amount of pre-tax income recognized from derivative instruments for the periods indicated and the line items in the accompanying Consolidated Statements of Operations where the results are recorded for net investment hedges:

Amount of Loss Recognized in OCI on Derivatives

Fiscal Year Ended Location of Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing) Amount of Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing)

Fiscal Year Ended

(In millions)

2025 2024 2023 2025 2024 2023

Cross currency swap contracts

$ ( 2.7 ) $ ( 3.9 ) $ ( 4.4 ) Interest expense $ 0.8 $ 0.9 $ 0.9

These derivative instruments are subject to master netting agreements giving effect to rights of offset with each counterparty.

None of the balances were eligible for netting.

(In millions) Derivative Assets and Liabilities

Derivatives Designated as Net Investment Hedges Balance Sheet Location October 3, 2025 September 27, 2024

Cross currency swap contracts Prepaid expenses and other current assets $ — $ 1.0

Cross currency swap contracts Accrued liabilities and other current liabilities 10.4 —

Cross currency swap contracts Other long-term liabilities $ — $ 8.6

Derivatives not Designated as Hedging Instruments

During the second quarter of fiscal year 2025, the Company elected to partially dedesignate $ 6.9 million of the cross currency swap contracts that ceased to meet the effectiveness criteria and hedge accounting was discontinued.

At the time of dedesignation, the total amount recorded for the dedesignated portion as a cumulative fair value basis adjustment on the cross currency swap was a loss of $ 0.4 million.

The loss on the cross currency swap dedesignation is recorded in accumulated other comprehensive loss where it will remain until such time that substantial liquidation of the international operations should occur.

The dedesignated cross currency swap contract is considered an economic hedge of the Company's investments in wholly-owned international operations.

As such, changes in the fair value of the dedesignated cross currency swap after the date of dedesignation have been reported in other expense, net in the Consolidated Statements of Operations.

During the third quarter of fiscal year 2025, the Company unwound the dedesignated portion of its outstanding cross currency swap contract which resulted in cash paid upon settlement of $ 0.8 million.

The Company recognized $ 0.1 million of loss on the unwinding of the dedesignated portion, which was reported in other expense, net in the Consolidated Statements of Operations.

Balance Sheet Hedges

These forward contracts are generally entered into at the end of one fiscal period and expire by the end of the next fiscal period.

These forward contracts are not designated for hedge accounting treatment;

The Company has not and does not intend to use derivative financial instruments for speculative or trading purposes.

The following table shows the notional amounts of outstanding foreign currency contracts as of October 3, 2025:

Notional Value of Derivatives not Designated as Hedging Instruments:

(In millions of equivalent USD) Buy Contracts Sell Contracts

Australian Dollar $ — $ 2.9

Chinese Renminbi — 15.6

Japanese Yen 7.3 —

Mexican Peso — 1.3

Philippine Peso 16.3 —

Swiss Franc 2.4 —

Total notional value $ 26.0 $ 47.6

NONCONTROLLING INTERESTS

1 unchanged sentence

The Company has majority voting rights with an approximate 75 % interest.

Accordingly, the Company has consolidated the operations of the Saudi Arabia partnership in the Company's consolidated financial statements and recorded the noncontrolling interests.

The noncontrolling interest related to the partner’s 25 % interest in the joint venture is included in noncontrolling interests in the equity section of the Company’s Consolidated Balance Sheets.

Accordingly, the Company has consolidated the operations of the Saudi Arabia partnership in its Consolidated Balance Sheets and recorded the noncontrolling interests.

The noncontrolling interest related to the partner’s 25 % interest is included in noncontrolling interests in the equity section of the Company’s Consolidated Balance Sheets.

Income representing the noncontrolling partner's share of income from operations is included in the Company's Consolidated Statements of Operations.

In April 2015, the Company completed the acquisition of 73.5 % of the then outstanding shares of MeVis Medical Solutions AG (“MeVis”), a public company based in Bremen, Germany, that provides image processing software and services for cancer screening.

In August 2015, the Company, through one of its German subsidiaries, entered into a Domination and Profit and Loss Transfer Agreement (the “DPLTA”) with MeVis.

In October 2015, the DPLTA became effective upon its registration at the local court of Bremen, Germany.

Unde r the DPLTA, MeVis subordinates its management to the Company and undertakes to transfer all of its annual profits and losses to the Company.

In return, the DPLTA grants the noncontrolling shareholders of MeVis:

(1) an annual recurring net compensation of € 0.95 per MeVis share starting from January 1, 2015 and (2) a put right for their MeVis shares at € 19.77 per MeVis share.

In fiscal years 2017 and 2018, the Company purchased an immaterial number of MeVis' shares for an additional 0.2 % of outstanding shares under the put right such that the Company now owns 73.7 % of the outstanding shares of common stock of MeVis .

During the fourth quarter of fiscal year 2020, the put right granted to the noncontrolling shareholders of MeVis under the DPLTA expired unexercised, which resulted in the redeemable noncontrolling interests being reclassified to permanent equity as noncontrolling interest in the Consolidated Balance Sheets.

As of September 27, 2024, noncontrolling shareholders together held approximately 0.5 million shares of MeVis, representing 26.3 % of the outstanding shares.

Changes in noncontrolling interests were as follows:

(In millions) Noncontrolling

Interests Noncontrolling Interests

Balance at beginning of period $ 13.3 $ 13.3

In April 2015, the Company acquired 73.5 % of the then outstanding shares of MeVis Medical , a publicly traded company based in Bremen, Germany that provides image processing software and services for cancer screening.

In August 2015, the Company, through one of its German subsidiaries, entered into a Domination and Profit and Loss Transfer Agreement (the “DPLTA”) with MeVis Medical.

In fiscal years 2017 and 2018, the Company purchased an additional 0.2 % of outstanding shares such that the Company now owns 73.7 % of the outstanding shares of common stock of MeVis Medical.

Under the DPLTA, MeVis Medical subordinates its management to the Company and undertakes to transfer all its annual profits and losses to the Company.

In return, the DPLTA grants the noncontrolling shareholders of MeVis Medical, an annual recurring net compensation of € 0.95 per MeVis Medical share.

At October 3, 2025, noncontrolling shareholders together held approximately 0.5 million shares of MeVis Medical, representing 26.3 % of the outstanding shares.

During the first quarter of fiscal year 2024, the Company acquired a controlling interest in MeVis Breastcare, in which the Company now holds an 87.1 % ownership interest.

In connection with this acquisition, the Company recorded an associated noncontrolling interest of $ 0.7 million.

The c hanges in noncontrolling interests were as follows:

(In millions) 2025 2024

Noncontrolling interests, at beginning of period $ 14.1 $ 13.3

Net income attributable to noncontrolling interests 0.4 0.5

Business acquisitions — 0.7

Other, including foreign currency remeasurement ( 0.4 ) ( 0.5 )

Balance at end of period $ 14.1 $ 13.3

Other ( 0.5 ) ( 0.4 )

Noncontrolling interests, at end of period $ 14.0 $ 14.1

EMPLOYEE STOCK PLANS

2 unchanged sentences

In January 2017, Varex stockholders approved the 2017 ESPP, which provides eligible employees with an opportunity to purchase shares of Varex common stock at 85 % of the lower of its fair market value at the start and end of a six-month purchase period.

During the fiscal year 2022, the Company's Board of Directors approved an increase in the number of shares available for issuance under the 2017 ESPP of 0.8 million shares.

As of September 27, 2024 the 2017 ESPP provides for the purchase of up to 1.8 million shares of Varex common stock.

During fiscal year 2025, the Company's Board of Directors approved an increase in the number of shares available for issuance under the 2017 ESPP of 0.9 million shares.

As of October 3, 2025 the 2017 ESPP provides for the purchase of up to 2.7 million shares of Varex common stock.

Share-Based Compensation Expense

3 unchanged sentences

(In millions) 2025 2024 2023

2024 2023 2022

Cost of revenues $ 2.0 $ 1.8 $ 1.7

$ 1.8 $ 1.7 $ 1.6

Research and development 3.2 3.4 3.3

1 unchanged sentence

Total share-based compensation expense $ 15.0 $ 15.3 $ 13.5

$ 15.3 $ 13.5 $ 14.0

The unrecognized share-based compensation cost as of September 27, 2024 was $ 23.8 million, and is expected to be recognized over a weighted average period of 1.9 fiscal years.

As of September 27, 2024, there were approximately 5.0 million and 0.3 million shares of common stock available for future issuances under the 2020 Stock Plan and the 2017 ESPP, respectively.

The unrecognized share-based compensation cost as of October 3, 2025 was $ 20.3 million, and is expected to be recognized over a weighted average period of 2.1 years.

As of October 3, 2025, there were approximately 4.5 million and 0.8 million shares of common stock available for future issuances under the 2020 Stock Plan and the 2017 ESPP, respectively.

The Company utilized the Black-Scholes valuation model for estimating the fair value of stock options granted and the option component of ESPP grants.

29 unchanged sentences

The following table summarizes the activity for stock options under Varex’s employee incentive plans for the Company’s employees:

(In thousands, except per share amounts and the remaining term)

Weighted Average

Exercise Price

(In thousands, except per share amounts and the remaining term) Options Price Range Weighted Average Exercise Price

Weighted Average Remaining Term (in years)

2 unchanged sentences

$ 26.79 5.5 $ —

17 $ 13.84 - $ 13.84

Canceled, expired or forfeited ( 267 ) $ 22.13 - $ 37.60

( 782 ) $ 31.08 - $ 34.13

Outstanding at September 27, 2024 2,097 $ 13.61 - $ 37.60

Outstanding at October 3, 2025 1,830 $ 13.61 - $ 31.42

$ 25.61 5.1 $ —

Exercisable at September 27, 2024 1,720 $ 13.61 - $ 37.60

Exercisable at October 3, 2025 1,675 $ 13.61 - $ 31.42

$ 25.89 4.9 $ —

(1) The aggregate intrinsic value represents the total pre-tax intrinsic value, which is computed based on the difference between the exercise price and the closing price of Varex common stock of $ 11.92 as of September 27, 2024, the last trading date of the Company's respective fiscal years, and which represents the amount that would have been received by the option holders had all option holders exercised their options and sold the shares received upon exercise as of that date.

(1) The aggregate intrinsic value represents the total pre-tax intrinsic value, which is computed based on the difference between the exercise price and the closing price of Varex common stock of $ 11.94 as of October 3, 2025, the last trading date of the Company's respective fiscal years, and which represents the amount that would have been received by the option holders had all option holders exercised their options and sold the shares received upon exercise as of that date.

The grant-date fair value of options granted during fiscal years 2025, 2024, and 2023 was $ 0.0 million , $ 0.1 million and $ 4.0 million, respectively.

The total intrinsic value of the options exercised during the years ended September 27, 2024, September 29, 2023 and September 30, 2022 was $ 0.0 million , $ 0.1 million and $ 0.5 million, respectively.

The total intrinsic value of the options exercised during the years ended October 3, 2025, September 27, 2024, and September 29, 2023 was $ 0.0 million , $ 0.0 million and $ 0.1 million, respectively.

Restricted Stock Units, Performance Stock Units, Restricted Stock Awards and Deferred Stock Units

During the fiscal year 2024, the Company issued performance stock units ("PSUs") to certain officers and key employees in connection with our long-term incentive program.

The Company issues performance stock units ("PSUs") to certain officers and key employees in connection with our long-term incentive program.

Each PSU represents the right to receive one share of our common stock, provided that the applicable performance and vesting conditions are satisfied.

The fair value of PSUs are linked to the achievement of financial performance metrics or a market condition based on our relative total shareholder return over the performance period compared to a predetermined peer group.

The following table summarizes the activity for restricted stock units, performance stock units, restricted stock awards and deferred stock units under the 2020 Stock Plan:

(In thousands, except per share amounts)

Number of Shares

Weighted Average

Grant-Date Fair

Balance at September 29, 2023 1,277 $ 22.30

( 394 ) 23.05

Canceled, expired or forfeited

Balance at September 27, 2024 1,670 $ 20.74

(In thousands, except per share amounts) Number of Shares Weighted Average Grant-Date Fair Value

Outstanding at September 27, 2024 1,670 $ 20.74

Granted 776 14.95

Vested ( 407 ) 21.30

Canceled or expired ( 93 ) 20.40

Outstanding at October 3, 2025 1,946 $ 18.35

The total grant-date fair value of shares granted was $ 11.6 million, $ 17.2 million, and $ 11.3 million for fiscal years 2025, 2024, and 2023, respectively.

Shares outstanding at September 27, 2024, September 29, 2023 and September 30, 2022 had an estimated market value of $ 20.0 million, $ 24.0 million and $ 22.1 million, respectively.

TAXES ON INCOME

Shares outstanding at October 3, 2025, September 27, 2024, and September 29, 2023 had an estimated market value of $ 23.2 million, $ 20.0 million, and $ 24.0 million, respectively.

TAXES ON INCOME (LOSS)

Income tax expense or benefit is based on reported income or loss before income taxes.

2 unchanged sentences

Valuation allowances are recognized to reduce deferred tax assets to the amount that is more likely than not to be realized.

Income tax expense (benefit) was as follows:

The income tax expense (benefit) was as follows:

(In millions) 2025 2024 2023

2 unchanged sentences

State and local

4.6 12.6 10.3

Total current

8 unchanged sentences

Income tax expense (benefit) $ 10.7 $ 53.3 $ ( 16.6 )

Income before taxes are generated from the following geographic areas:

The (loss) income before taxes are generated from the following geographic areas:

(In millions) 2025 2024 2023

1 unchanged sentence

Foreign ( 33.4 ) 20.1 37.5

Income before taxes $ 5.0 $ 31.3 $ 44.5

(Loss) income before taxes $ ( 59.2 ) $ 5.0 $ 31.3

The effective tax rate differs from the U.S.

federal statutory tax rate as a result of the following:

2025 2024 2023

Federal statutory income tax rate

2 unchanged sentences

( 0.4 ) ( 7.5 ) 0.3

Impairment of goodwill ( 33.3 ) — —

Statutory rate change impact on prior year deferreds — ( 0.3 ) —

10 unchanged sentences

During fiscal year 2025, the Company's effective tax rate varied from the U.S.

federal statutory rate of 21% primarily due to the goodwill impairment that took place in the third quarter of fiscal year 2025, the unfavorable impact of U.S.

deferred tax attributes and losses in certain foreign jurisdictions for which a valuation allowance is provided, as well as profit in foreign jurisdictions with statutory tax rates greater than 21%.

These unfavorable items were partially offset by the favorable impact of U.S.

tax reform regarding international provision, R&D credits, and return to provision adjustments.

The Organization for Economic Cooperation and Development enacted model rules for Pillar Two, which became effective for the Company in fiscal year 2025.

However, on June 28, 2025, the G7 released a joint statement that it had reached an understanding with the United States for a side-by-side system based on certain accepted principles, including that U.S.-parented groups, such as ours, would be exempted from certain provisions of Pillar Two.

As a result, there remains a great deal of uncertainty

as to the final Pillar Two model rules applicable to our Company and its subsidiaries.

The Company has estimated its fiscal year 2025 Pillar Two tax expense, and has included these amounts in the calculation of the fiscal year 2025 tax provision.

On July 4, 2025, the OBBBA was enacted in the U.S.

The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions, including the option to claim 100% accelerated depreciation deductions and qualified property, with retrospective application beginning January 20, 2025.

The legislation has multiple effective dates, with the 100% accelerated depreciation deduction starting to be effective during the fiscal year ended October 3, 2025, and others implemented through future years.

During fiscal year 2024, the Company’s effective tax rate varied from the U.S.

federal statutory rate of 21% primarily due to the unfavorable impact of U.S.

7 unchanged sentences

These favorable items were partially offset by the unfavorable impact of profit in foreign jurisdictions with statutory tax rates greater than 21%.

During fiscal year 2022, the Company’s effective tax rate varied from the U.S.

federal statutory rate of 21% primarily due to the unfavorable impact of profit in foreign jurisdictions with statutory tax rates greater than 21% and also U.S.

deferred tax attributes and losses in certain foreign jurisdictions for which a valuation allowance is provided.

These unfavorable items are partially offset by the favorable impact of U.S.

tax reform international provisions, return to provision adjustments, and R&D tax credits.

The Company has estimated its fiscal year 2024 GILTI (global intangible low-taxed income), BEAT (base-erosion anti-abuse tax), FDII (foreign-derived intangible income), limitations on interest expense deductions, and other components of U.S.

tax reform, and have included these amounts in the calculation of the fiscal year 2024 tax provision.

The Company has made an accounting policy election, as allowed by the SEC and FASB, to recognize the impact of GILTI as a period cost if and when incurred.

Significant components of deferred tax assets and liabilities are as follows:

(In millions) September 27, 2024 September 29, 2023

The s ignificant components of deferred tax assets and liabilities are as follows:

(In millions) October 3, 2025 September 27, 2024

Deferred tax assets:

9 unchanged sentences

Deferred financing fees 0.1 2.5

Interest expense limitation 1.1 —

Capitalized interest 1.0 1.1

1 unchanged sentence

Investments in privately held companies 4.2 4.0

Research and experimentation capitalization 30.8 17.6

Royalty advance 1.5 6.6

Research and experimentation capitalization 37.8 30.8

Other DTA 5.2 3.9

5 unchanged sentences

Property, plant and equipment ( 5.7 ) ( 7.1 )

Goodwill amortization — ( 6.0 )

Operating lease assets ( 6.1 ) ( 7.3 )

1 unchanged sentence

Total deferred tax liabilities ( 23.3 ) ( 25.5 )

Net deferred tax assets $ 3.3 $ 41.3

Net deferred tax liabilities $ ( 2.6 ) $ ( 2.7 )

Deferred tax assets $ 20.7 $ 22.8

Deferred tax liabilities ( 23.3 ) ( 25.5 )

Net deferred tax assets $ 3.3 $ 41.3

The Company is maintaining its reinvestment assertion with respect to foreign earnings for the year ended September 27, 2024, which is that all earnings prior to fiscal year 2018 are permanently reinvested for all countries, and that all earnings for Varex Imaging Sweden and Oy Varex Imaging Finland, are also indefinitely reinvested in those countries, but post fiscal year 2017 earnings in all other countries are not permanently reinvested.

Net deferred tax liabilities $ ( 2.6 ) $ ( 2.7 )

The Company is maintaining its reinvestment assertion with respect to foreign earnings for the year ended October 3, 2025, which is that all earnings prior to fiscal year 2018 are permanently reinvested for all countries, and that all earnings for Varex Imaging Sweden and Oy Varex Imaging Finland, are also indefinitely reinvested in those countries, but post fiscal year 2017 earnings in all other countries are not permanently reinvested.

Due to the level of earnings available for repatriation, the treaty benefits applicable to jurisdictions in which those earnings are located, and the now favorable U.S.

2 unchanged sentences

state income taxes and foreign withholding taxes that would apply if the foreign earnings were repatriated in the form of a dividend.

As of September 27, 2024, the Company had foreign net operating loss carryforwards ("NOL") of approximately $ 18.9 million carried forward indefinitely.

As of October 3, 2025, the Company had foreign net operating loss carryforwards ("NOL") of approximately $ 89.6 million carried forward indefinitely.

A valuation allowance is provided if it is more likely than not that some or all of the deferred tax assets will not be realized.

Also, net operating loss carryforwards in jurisdictions with current losses provide uncertainty for realization.

As of September 27, 2024, based on the Company’s assessment of the realizability of net deferred tax assets, it reached the conclusion that it was more likely than not that the U.S.

federal deferred tax assets are not realizable.

As a result, a valuation allowance was placed against all of

federal deferred tax assets.

The Company continues to maintain a valuation allowance against U.S.

state R&D credit carryforwards and increased its valuation allowance against state net operating losses.

The Company also maintains full valuation allowances against the net deferred tax assets in Sweden, the United Kingdom, and Saudi Arabia, due to recent historical losses and the uncertainty of future taxable income to realize those net operating losses.

The valuation allowance increased by $ 56.0 million during fiscal year 2024 and decreased by $ 13.5 million during fiscal year 2023.

Changes in the Company's valuation allowance for deferred tax assets were as follows:

As of October 3, 2025,

based on the Company’s assessment of the realizability of net deferred tax assets, it reached the conclusion that it was more likely than not that one of its Indian subsidiaries' deferred tax assets are not realizable.

As a result, a valuation allowance was placed against the subsidiaries' Indian deferred tax assets.

The Company also maintains full valuation allowances against the net deferred tax assets in Sweden, the United Kingdom, the United States, and Saudi Arabia, due to recent historical losses and/or the uncertainty of future taxable income to realize those net operating losses.

The valuation allowance increased by $ 4.7 million during fiscal year 2025 and increased by $ 56.0 million during fiscal year 2024.

The c hanges in the Company's valuation allowance for deferred tax assets were as follows:

(In millions) 2025 2024 2023

6 unchanged sentences

The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement.

Changes in the Company’s unrecognized tax benefits were as follows:

The c hanges in the Company’s unrecognized tax benefits were as follows:

(In millions) 2025 2024

1 unchanged sentence

Additions based on tax positions related to the current year 0.2 0.2

Reductions resulting from the expiration of the applicable statute of limitations ( 0.5 ) —

Unrecognized tax benefits balance—end of fiscal year $ 1.3 $ 1.6

As of September 27, 2024 and September 29, 2023, the total amount of gross unrecognized tax benefits was $ 1.6 million and $ 1.4 million, respectively, all of which would affect the effective tax rate if recognized.

As of October 3, 2025 and September 27, 2024, the total amount of gross unrecognized tax benefits was $ 1.3 million and $ 1.6 million, respectively, all of which would affect the effective tax rate if recognized.

The Company includes interest and penalties related to income taxes within income tax expense (benefit) on the Consolidated Statements of Operations.

For the year ended September 27, 2024, $ 0.2 million interest and penalties have been included for this period.

For the year ended September 29, 2023, $ 0.2 million interest and penalties have been included for this period.

For the year ended September 30, 2022, $ 0.2 million interest and penalties have been included for this period.

Interest and penalties of $ 0.1 million, $ 0.2 million, and $ 0.2 million were included for the fiscal periods ended October 3, 2025, September 27, 2024, and September 29, 2023, respectively.

The Company files U.S.

7 unchanged sentences

Medical and Industrial, which aligns with how its CEO, who is the Company's Chief Operating Decision Maker (“CODM”) reviews the Company’s performance.

The segments align the Company’s products and service offerings with customer use in medical and industrial and are consistent with how the Company’s CEO evaluates the business for the allocation of resources.

The segments align the Company’s products and service offerings with customer use in medical and industrial markets and are consistent with how the Company’s CEO evaluates the business for the allocation of resources.

The CODM allocates resources to and evaluates the financial performance of each operating segment primarily based on revenues and gross profit.

1 unchanged sentence

Description of Segments

The Medical segment designs, manufactures, sells, and services X-ray imaging components, including X-ray tubes, digital detectors and accessories, ionization chambers, high voltage connectors, image-processing software and workstations, 3D reconstruction software, computer-aided diagnostic software, collimators, automatic exposure control devices, generators, and heat exchangers.

The Medical segment designs, manufactures, sells, and services X-ray imaging components, including X-ray tubes, digital detectors and accessories, ionization chambers, high voltage connectors, image-processing software and workstations, 3D reconstruction software, computer-aided diagnostic software, automatic exposure control devices, generators, and heat exchangers.

These components are used in a range of medical imaging applications including CT, mammography, oncology, cardiac, surgery, dental, and other diagnostic radiography uses.

The Industrial segment designs, develops, manufactures, sells and services X-ray imaging products for use in a number of applications, including security applications for cargo screening at ports and borders, baggage screening at airports, and nondestructive testing, irradiation, and inspection applications used in a number of other verticals.

The Company's industrial products include Linatron® X-ray linear accelerators, X-ray tubes, digital detectors, high voltage connectors, and coolers.

The Industrial segment designs, develops, manufactures, sells and services X-ray imaging products for use in a number of markets, including security applications for cargo screening at ports and borders, baggage screening at airports, and nondestructive testing, irradiation, and inspection applications used in a number of other vertical markets, as well as X-ray imaging systems for industrial applications.

The Company's industrial products include Linatron® X-ray linear accelerators, non-intrusive cargo inspection systems, X-ray tubes, digital detectors, high voltage connectors, and coolers.

In addition, the Company licenses proprietary image-processing and detection software designed to work with other Varex products to provide packaged sub-assembly solutions to industrial customers.

3 unchanged sentences

(In millions) 2025 2024 2023

2024 2023 2022

$ 581.7 $ 673.3 $ 674.7

229.3 220.1 184.7

Revenues, net

Medical $ 592.6 $ 581.7 $ 673.3

Industrial 252.0 229.3 220.1

Total revenues 844.6 811.0 893.4

811.0 893.4 859.4

176.7 205.5 210.5

80.2 84.8 73.0

Cost of revenues

Medical 392.5 405.0 467.8

Industrial 161.6 149.1 135.3

Total cost of revenues 554.1 554.1 603.1

Medical 200.1 176.7 205.5

Industrial 90.4 80.2 84.8

Total gross profit 290.5 256.9 290.3

256.9 290.3 283.5

Total operating expenses 318.3 224.8 213.2

224.8 213.2 195.3

Interest and other expense, net ( 31.4 ) ( 27.1 ) ( 45.8 )

Income before taxes 5.0 31.3 44.5

(Loss) income before taxes ( 59.2 ) 5.0 31.3

Income tax expense (benefit) 10.7 53.3 ( 16.6 )

4 unchanged sentences

Geographic Information

Revenues Long-Lived Assets

Fiscal Years Fiscal Years

(In millions) 2024 2023 2022 2024 2023

The following table summarizes the Company’s long-lived assets by geographic region:

(In millions) October 3, 2025 September 27, 2024

Americas $ 102.7 $ 109.2

1 unchanged sentence

APAC 14.2 16.6

Total company

$ 811.0 $ 893.4 $ 859.4 $ 153.4 $ 143.6

Revenue in the United States of America was $ 257.7 million, $ 275.1 million and $ 263.7 million in fiscal years 2024, 2023 and 2022, respectively.

The Company operates various manufacturing and marketing operations outside the United States.

Americas includes North and South America.

EMEA includes Europe, Russia, the Middle East, India and Africa.

APAC includes Asia and Australia.

Revenues by region are based on the known final destination of products sold.

Total property, plant, and equipment, net $ 157.8 $ 153.4

See Note 2, Revenue, for disaggregation of revenue by geographic region and country.

OTHER FINANCIAL INFORMATION

The following table summarizes the Company’s accrued liabilities and other current liabilities :

(In millions) October 3, 2025 September 27, 2024

Accrued compensation and benefits $ 43.4 $ 30.0

Product warranty 8.5 10.8

Taxes payable 5.3 8.1

Refund liability 7.7 7.5

Derivative liability 10.4 —

Accrued interest 13.5 11.7

Other 9.6 10.5

Total accrued liabilities and other current liabilities $ 98.4 $ 78.6

The following table summarizes the Company’s other long-term liabilities :

(In millions) October 3, 2025 September 27, 2024

Long-term income tax payable $ 2.3 $ 4.0

Environmental liabilities 2.4 3.0

Defined benefit obligation liability 6.2 5.9

Long-term refund liability 20.0 20.5

Derivative liability — 8.6

Long-term other 7.2 8.4

Total other long-term liabilities $ 38.1 $ 50.4

The following table summarizes the Company’s other expense, net :

(In millions) 2025 2024 2023

Loss from equity method investments $ ( 2.3 ) $ ( 1.0 ) $ ( 1.4 )

Gain on purchase of business — 2.1 —

Impairment of equity method investment — — ( 16.4 )

Realized losses on foreign currencies, net ( 3.0 ) ( 2.3 ) ( 1.0 )

Other 0.9 ( 3.0 ) ( 1.4 )

Total other expense, net $ ( 4.4 ) $ ( 4.2 ) $ ( 20.2 )

BUSINESS COMBINATIONS

Because the Company had the ability to exercise significant influence in, but not control, over MeVis Breastcare, it was historically accounted for as an equity method investment.

The purchase of this additional ownership interest was accounted for as a business combination achieved in stages, or step acquisition.

As a result, the previously held equity interest was remeasured to its acquisition-date fair value, with a gain of $ 0.9 million recognized in other expense, net in the Consolidated Statements of Operations.

The assets and liabilities of MeVis Breastcare were then recorded on the Company's balance sheet at their fair values in accordance with ASC 805, and a gain on bargain purchase of $ 1.2 million was recorded during the first quarter of fiscal year 2024 in other expense, net in the Consolidated Statements of Operations.

(in millions)

Consideration paid

Fair value of total consideration transferred 0.9

Remeasurement of previous equity interest

Carrying value of previous equity interest before acquisition 1.1

Fair value of previous equity interest at acquisition date 2.0

Remeasurement gain recorded on previous equity interest 0.9

Total of consideration paid and fair value of previous equity interest $ 2.9

Recognized amounts of identifiable assets acquired and liabilities assumed

Cash and cash equivalents $ 1.8

Accounts receivable, net 1.2

Intangible assets, net 2.6

Accounts payable ( 0.1 )

Accrued liabilities and other current liabilities ( 0.6 )

Other long-term liabilities ( 0.1 )

Total identifiable net assets 4.8

Noncontrolling interest in MeVis Breastcare ( 0.7 )

Bargain purchase gain ( 1.2 )

COMMITMENTS AND CONTINGENCIES

Lease Commitments

See Note 8 , Leases, for additional information about the Company's lease commitments.

Other Commitments

See Note 3, Related-Party Transactions, for additional information about the Company’s commitments to dpiX.

See Note 10 , Noncontrolling Interests, for additional information about the Company’s commitment to the noncontrolling shareholders of MeVis.

The Company has an environmental liability of approximately $ 3.2 million as of October 3, 2025.

See Note 1, Summary of Significant Accounting Policies, for additional information.

The Company enters into purchase agreements with its suppliers in the ordinary course of its business for the purchase of goods and services.

Some of these purchase agreements are non-cancellable and thus contractually obligate the Company to future cash payments.

The Company has non-cancellable supplier purchase obligations of approximately $ 3.0 million as of October 3, 2025.

Contingencies

The Company did not have any material contingent liabilities as of October 3, 2025 and September 27, 2024.

Legal expenses are expensed as incurred.

EMPLOYEE BENEFIT PLANS

Varex’s 401(k) plan is intended to be qualified under Section 401(a) of the Code with the 401(k) plan’s related trust intended to be tax exempt under Section 501(a) of the Code and intended for all full-time employees in the United States.

This plan allows employees to contribute a portion of their pretax salary up to the maximum dollar limitation prescribed by the Internal Revenue

This plan allows employees to contribute a portion of their pretax salary up to the maximum dollar limitation prescribed by the Internal Revenue Service.

The Company made matching contributions to the plan totaling $ 4.4 million, $ 4.6 million, and $ 4.9 million in fiscal years 2025, 2024, and 2023, respectively.

The Company also maintains defined benefit plans for certain employees located outside the United States.

The net pension liability is included in other long-term liabilities on the Company's Consolidated Balance Sheets and totaled $ 5.9 million and $ 5.2 million as of September 27, 2024 and September 29, 2023, respectively.

The net pension liability is included in other long-term liabilities on the Company's Consolidated Balance Sheets and totaled $ 6.2 million and $ 5.9 million as of October 3, 2025 and September 27, 2024, respectively.

The Company’s net periodic benefit costs for the Company’s defined benefit plans were not material for fiscal years 2025, 2024, and 2023.

ACCUMULATED OTHER COMPREHENSIVE LOSS

The following tables present the changes in the accumulated balances for each component of other comprehensive (loss) income:

(In millions) (Loss) Income on Forward Contracts Unrealized Gain (Loss) on Defined Benefit Obligations CTA, Including Impact of Net Investment Hedge Unrealized (Loss) Income on Available-For-Sale Securities Accumulated Other Comprehensive Income (Loss)

The following tables present the changes in the accumulated balances for each component of accumulated other comprehensive loss:

(In millions)

Gain on Forward Contracts Unrealized Loss on Defined Benefit Obligations CTA, Including Impact of Net Investment Hedge

Unrealized (Loss) Gain on Available-For-Sale Securities Accumulated Other Comprehensive Loss

Balance at September 29, 2023 $ ( 0.5 ) $ ( 0.4 ) $ ( 0.3 ) $ — $ ( 1.2 )

2 unchanged sentences

Adjustments reclassified out of accumulated other comprehensive loss 0.1 — — — 0.1

Income tax impact

— 0.2 — — 0.2

Foreign currency translation adjustment

1 unchanged sentence

Balance at September 27, 2024 $ ( 0.4 ) $ ( 0.4 ) $ ( 2.2 ) $ 0.1 $ ( 2.9 )

Other comprehensive (loss) income before reclassifications

Other comprehensive income (loss) before reclassifications

— 0.1 ( 2.7 ) ( 0.1 ) ( 2.7 )

Adjustments reclassified out of accumulated other comprehensive loss 0.1 — — — 0.1

Income tax impact

— ( 0.1 ) — — ( 0.1 )

Foreign currency translation adjustment

— — 0.4 — 0.4

Balance at September 27, 2024 $ ( 0.4 ) $ ( 0.4 ) $ ( 2.2 ) $ 0.1 $ ( 2.9 )

Balance at October 3, 2025 $ ( 0.3 ) $ ( 0.4 ) $ ( 4.5 ) $ — $ ( 5.2 )

SUBSEQUENT EVENTS

On October 14, 2025, the Company purchased certain equipment, inventory, and other assets to be used in the Company’s operations.

The Company anticipates accounting for the transaction as an asset acquisition in accordance with U.S.

The purchase price for the asset acquisition was $ 3.6 million.

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 9A. Controls and Procedures