AME 10-K & 10-Q changes, risk factors and insider trading
Ametek Inc./ · NYSE · Industrial Instruments For Measurement, Display, And Control · CIK 1037868 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
Largest changes
We rely on information technology systems, some of which are managed by third-parties, to process, transmit and store electronic information (including sensitive data such as confidential business information and personally identifiable data relating to employees, customers, other business partners and patients), and to monitor, manage, and support a variety of critical business processes and activities including receiving and fulfilling orders, billing, collecting and making payments, shipping products, providing services and support to customers and fulfilling contractual obligations. Despite our implementation of certain controls to protect our systems and sensitive, confidential or personal data or information, these systems, products, data and services may be damaged, compromised, disrupted or shut down due to attacks by computer hackers, computer viruses, ransomware, misuse of artificial intelligence, human error or malfeasance, power outages, hardware failures, telecommunication or utility failures, catastrophes or other unforeseen events. In any such circumstances, our system redundancy and other disaster recovery planning may be ineffective or inadequate. Further, we also face information security risks due to our reliance on internet technology and use of hybrid work arrangements, which could strain our technology resources or create additional opportunity for cyber-attackers to exploit vulnerabilities. Moreover, the rapid evolution and adoption of artificial intelligence may increase our cybersecurity risks.see in full comparison
International sales forsee in full comparison20242025 and20232024 represented 48.2% and 47.4% of our consolidated netsales.sales, respectively. As a result of our growth strategy, we anticipate that the percentage of sales outside the United States will increase in the future. As of December 31,2024,2025, we have manufacturing operations in2022 countries outside the United States, with significant operations in Canada, China, France, Germany, Mexico, Serbia, Poland and the United Kingdom. A disruption of our ability to obtain a supply of goods from these countries or a change in the cost to purchase, manufacture, or distribute these products could have an adverse effect on our sales and operations. International sales and operations are subject to the customary risks of operating in an international environment, including:
Full comparison: every changed paragraph (3)
International sales for 20242025 and 20232024 represented 48.2% and 47.4% of our consolidated net sales.sales, respectively. As a result of our growth strategy, we anticipate that the percentage of sales outside the United States will increase in the future. As of December 31, 2024,2025, we have manufacturing operations in 2022 countries outside the United States, with significant operations in Canada, China, France, Germany, Mexico, Serbia, Poland and the United Kingdom. A disruption of our ability to obtain a supply of goods from these countries or a change in the cost to purchase, manufacture, or distribute these products could have an adverse effect on our sales and operations. International sales and operations are subject to the customary risks of operating in an international environment, including:
We believe that our future success depends, in part, on our ability to develop, on a timely basis, technologically advanced products that meet or exceed appropriate industry standards. Maintaining our existing technological advantages will require us to continue investing in research and development and sales and marketing. There can be no assurance that we will have sufficient resources to make such investments, that we will be able to make the technological advances necessarynecessary, including through the use of artificial intelligence, to maintain such competitive advantages or that we can recover major research and development expenses. We are not currently aware of any emerging standards or new products which could render our existing products obsolete, although there can be no assurance that this will not occur or that we will be able to develop and successfully market new products.
We rely on information technology systems, some of which are managed by third-parties, to process, transmit and store electronic information (including sensitive data such as confidential business information and personally identifiable data relating to employees, customers, other business partners and patients), and to monitor, manage, and support a variety of critical business processes and activities including receiving and fulfilling orders, billing, collecting and making payments, shipping products, providing services and support to customers and fulfilling contractual obligations. Despite our implementation of certain controls to protect our systems and sensitive, confidential or personal data or information, these systems, products, data and services may be damaged, compromised, disrupted or shut down due to attacks by computer hackers, computer viruses, ransomware, misuse of artificial intelligence, human error or malfeasance, power outages, hardware failures, telecommunication or utility failures, catastrophes or other unforeseen events. In any such circumstances, our system redundancy and other disaster recovery planning may be ineffective or inadequate. Further, we also face information security risks due to our reliance on internet technology and use of hybrid work arrangements, which could strain our technology resources or create additional opportunity for cyber-attackers to exploit vulnerabilities. Moreover, the rapid evolution and adoption of artificial intelligence may increase our cybersecurity risks.
Management's Discussion & Analysis (MD&A)
New heading “Subsequent Event”
Removed heading “Subsequent Events”
Largest changes
“During 2025, the United States government announced additional tariffs and trade restrictions on goods imported into the U.S. from various nations. Our businesses have been proactive in addressing the potential impacts of tariffs, including targeted pricing initiatives, strategic adjustments to our global supply chains, and leveraging our worldwide manufacturing footprint to localize production and adapt to changing demand patterns. …”see in full comparison
“When testing goodwill for impairment, the Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not the estimated fair value of a reporting unit is less than its carrying amount. If the Company performs a qualitative assessment and determines that an impairment is more likely than not, then performance of a quantitative impairment test is required. …”see in full comparison
see in full comparisonTheIfCompanyperformed,principallythereliesquantitativeongoodwill impairment test uses a discounted cash flow analysis to determine the fair value of each reporting unit, which considers cash flows discounted at an appropriate discount rate. The annual goodwill impairment test requires the Company to make a number of assumptions and estimates concerning future levels of revenue growth, operating margins, depreciation, amortization and working capital requirements, which are based on the Company’s long-range plan and are considered level 3 inputs. The discount rate is an estimate of the overall after-tax rate of return required by a market participant whose weighted average cost of capital includes both equity and debt, including a risk premium. While the Company uses the best available information to prepare its cash flow and discount rate assumptions, actual future cash flows or market conditions could differ significantly resulting in future impairment charges related to recorded goodwill balances.While there are always changes in assumptions to reflect changing business and market conditions, the Company’s overall methodology and the population of assumptions used have remained unchanged. In order to evaluate the sensitivity of the goodwill impairment test to changes in the fair value calculations, the Company applied a hypothetical 10% decrease in fair values of each reporting unit. The 2024 results (expressed as a percentage of carrying value for the respective reporting unit) showed that, despite the hypothetical 10% decrease in fair value, the fair values of the Company’s reporting units still exceeded their respective carrying values by 95% to 388%.
•Goodwill and Other Intangible Assets. Goodwill and other intangible assets with indefinite lives, primarily trademarks and trade names, are not amortized; rather, they are tested for impairment at least annually. The Company performs either a qualitative or quantitative analysis to determine if it is more likely than not that the fair values of its reporting units are less than the respective carrying values of those reporting units.see in full comparisonThe Company elected to bypass performing the qualitative screen and performed a quantitative analysis of the goodwill impairment test in the current year. The Company may elect to perform a qualitative analysis in future periods.
“As a result of all of the Company’s cash flow activities in 2024, cash and cash equivalents at December 31, 2024 totaled $374.0 million, compared with $409.8 million at December 31, 2023. At December 31, 2024, the Company had $361.5 million in cash outside the United States, compared with $375.9 million at December 31, 2023. The Company utilizes this cash to fund its international operations, as well as to acquire international businesses. The Company is in compliance with all covenants, including financial covenants, for all of its debt agreements. …”see in full comparison
“As a result of all of the Company’s cash flow activities in 2025, cash and cash equivalents at December 31, 2025 totaled $458.0 million, compared with $374.0 million at December 31, 2024. At December 31, 2025, the Company had $374.5 million in cash outside the United States, compared with $361.5 million at December 31, 2024. The Company utilizes this cash to fund its international operations, as well as to acquire international businesses. The Company is in compliance with all covenants, including financial covenants, for all of its debt agreements. …”see in full comparison
Full comparison: every changed paragraph (53)
The Company benefits from its strategic initiatives under the AMETEK Growth Model's four key strategies: Operational Excellence, Strategic Acquisitions, Global & Market Expansion and New Products. In 2025, the Company posted record sales, operating income, net income, diluted earnings per share, orders, and backlog, as well as strong operating cash flow. Positive market trends, the Company's backlog, contributions from recent acquisitions, and benefits from the continued implementation of the AMETEK Growth Model had a positive impact on 2025 results.
AMETEK’s operations are affected by global, regional and industry-specific economic factors. However, the Company’s strategic geographic and industry diversification, and its mix of products and services, have helped to mitigate the potential adverse impact of any unfavorable developments in any one industry or the economy of any single country on its consolidated operating results. In 2024, the Company posted record sales, operating income, net income, diluted earnings per share, and operating cash flow. Positive market trends, the Company's backlog, contributions from recent acquisitions, and continued focus on and implementation of Operational Excellence initiatives had a positive impact on 2024 results. The Company also benefited from its strategic initiatives under AMETEK's four key strategies: Operational Excellence, Strategic Acquisitions, Global & Market Expansion and New Products.
•Cash provided by operating activities totaled a record $1,828.8 million in 2024, an increase of $93.5 million or 5.4%, compared with cash provided by operating activities of $1,735.3 million in 2023.
•Orders for 2025 were a record $7,579.4 million, an increase of $769.1 million or 11.3%, compared with $6,810.3 million in 2024. The Company's backlog of unfilled orders at December 31, 20242025 was $3,403.2a record $3,581.5 million.
•Cash provided by operating activities totaled $1,801.8 million in 2025. Free cash flow (cash flow provided by operating activities less capital expenditures) was $1,671.6 million in 2025.
•InDuring October 2024,2025, the Company spent $117.5$933.2 million in cash, net of cash acquired, to purchase Virtektwo Vision International ("Virtek"), a leading provider of advanced laser-based projection and inspection systems.businesses:
•In January 2025, AMETEK acquired Kern Microtechnik ("Kern"), a leading manufacturer of high-precision machining and optical inspection solutions.
•In July 2025, AMETEK acquired FARO Technologies ("FARO"), a leading provider of 3D measurement and imaging solutions.
•In 2025, the Company repurchased approximately 2.3 million shares of its common stock for $443.0 million, compared with $212.0 million used for repurchases of approximately 1.2 million shares in 2024.
•In the third quarter of 2024, the Company paid in full, at maturity, a $300 million in aggregate principal amount of 3.73% senior notes.
Recent Trends
During 2025, the United States government announced additional tariffs and trade restrictions on goods imported into the U.S. from various nations. Our businesses have been proactive in addressing the potential impacts of tariffs, including targeted pricing initiatives, strategic adjustments to our global supply chains, and leveraging our worldwide manufacturing footprint to localize production and adapt to changing demand patterns. The recent tariff modifications did not materially impact our results for 2025, however, as the situation continues to evolve, we cannot be certain of the outcome, which could adversely impact demand for our products, costs, inflation, customers, suppliers, and the overall global economy. We continue to monitor and analyze the impacts of the tariffs and will continue to implement appropriate actions as necessary to mitigate their effects.
For the year ended December 31, 2025 , the Company recorded $37.3 million of pre-tax acquisition-related costs related to the FARO acquisition, which are comprised of one-time transactions costs and ongoing integration costs. Acquisition-related integration costs of $25.3 million were recorded in Cost of sales and primarily include employee severance, change in control costs, and fair-value inventory adjustments. One-time acquisition-related transaction costs of $12.0 million were recorded in Other (expense) income, net and primarily include investment banker fees and representation and warranty insurance costs.
Net sales for 20242025 were $6,941.2$7,401.1 million, an increase of $344.2$459.9 million or 5.2%,6.6%, compared with net sales of $6,597.0$6,941.2 million in 2023.2024. The increase in net sales for 20242025 was due to a 7%4% increase from acquisitions, partially offset by a 2% organic sales decline.increase, as well as a 1% favorable effect of foreign currency translation. EIG net sales were $4,659.9$4,919.1 million in 2024,2025, an increase of 0.8%,5.6%, compared with $4,624.3$4,659.9 million in 2023.2024. EMG net sales were $2,281.3$2,482.0 million in 2024,2025, an increase of 15.6%,8.8%, compared with $1,972.7$2,281.3 million in 2023.2024.
Total international sales for 20242025 were $3,291.7$3,570.5 million or 47.4%48.2% of net sales, an increase of $163.5$278.8 million or 5.2%,8.5%, compared with international sales of $3,128.2$3,291.7 million or 47.4% of net sales in 2023.2024. The increase in international sales was primarily driven by strongcontributions from recent acquisitions and increased demand in Europeall and Asia, as well as contributions from the 2023 acquisitions.regions. Export shipments from the United States, which are included in total international sales, were $1,880.8$2,041.2 million in 2024,2025, an increase of $148.4$160.4 million or 8.6%,8.5%, compared with $1,732.4$1,880.8 million in 2023.2024.
Orders for 20242025 were $6,810.3$7,579.4 million, aan decreaseincrease of $102.1$769.1 million or 1.5%11.3% compared with $6,912.4$6,810.3 million in 2023.2024. The decreaseincrease in orders was due to a 2%4% increase from acquisitions, a 4% organic order decrease,increase, as well as a 1%3% unfavorablefavorable effect of foreign currency translation, partially offset by a 2% increase from acquisitions. The organic orders decrease is due to customer inventory normalization in our automation and engineered solutions core businesses.translation. The Company’s backlog of unfilled orders at December 31, 20242025 was $3,403.2a record $3,581.5 million, aan decreaseincrease of $130.9$178.3 million or 3.7%,5.2%, compared with $3,534.1$3,403.2 million at December 31, 2023.2024.
Segment operating income for 2024 was $1,884.9 million, an increase of $77.4 million or 4.3%, compared with segment operating income of $1,807.5 million in 2023. Segment operating income, as a percentage of net sales, decreased to 27.2% in 2024, compared with 27.4% in 2023. Segment operating income and operating margins in 2024 included $29.2 million of integration costs related to the Paragon acquisition, which negatively impacted segment operating margins by 40 basis points. The dilutive impact of the 2023 acquisitions negatively impacted segment operating margins by 110 basis points in 2024. Excluding the dilutive impact of the 2023 acquisitions and the Paragon integration costs, segment operating margins increased 130 basis points compared to 2023, due to the continued benefits from the Company's Operational Excellence initiatives.
Segment operating income for 2025 was $2,026.0 million, an increase of $141.1 million or 7.5%, compared with segment operating income of $1,884.9 million in 2024. Segment operating income, as a percentage of net sales, increased to 27.4% in 2025, compared with 27.2% in 2024. Segment operating income and operating margins in 2025 were negatively impacted 60 basis points by the dilutive impact of recent acquisitions and 30 basis points from acquisition-related integration costs. Segment operating income and operating margins in 2024 included $29.2 million of acquisition-related integration costs related to the Paragon acquisition, which negatively impacted segment operating margins by 40 basis points. Excluding the dilutive impact of the recent acquisitions, acquisition-related integration costs, and the Paragon acquisition-related integration costs, segment operating margins increased 70 basis points compared to 2024, due to the continued benefits from the Company's Operational Excellence initiatives.
Consolidated operating income was $1,779.6 million or 25.6% of net sales for 2024, an increase of $72.1 million or 4.2%, compared with $1,707.5 million or 25.9% of net sales in 2023.
Other expense, net was $5.1 million for 2024, compared with $19.3 million of other expense in 2023, a change of $14.2 million. During 2024, the Company recorded higher pension income of $6.5 million and lower acquisition-related due diligence expense compared to 2023.
The effective tax rate for 2024 was 17.2%, compared with 18.3% in 2023. See Note 9 to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for further details.
NetConsolidated operating income was $1,910.3 million or 25.8% of net sales for 2024 was $1,376.1 million,2025, an increase of $62.9$130.7 million or 4.8%,7.3%, compared with $1,313.2$1,779.6 million or 25.6% of net sales in 2023.2024.
Interest expense was $81.3 million for 2025, a decrease of $31.7 million or 28.1%, compared with $113.0 million in 2024. Higher borrowings under the revolving credit facility related to the December 2023 Paragon acquisition resulted in higher interest expense in 2024.
Other expense, net was $30.7 million for 2025, compared with $5.1 million of other expense in 2024. Other expense increased in 2025 primarily due to $12.0 million of acquisition-related transaction costs and increased environmental spend, compared to 2024.
The effective tax rate for 2025 was 17.7%, compared with 17.2% in 2024. See Note 9 to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for further details.
DilutedNet earnings per shareincome for 20242025 werewas $5.93,$1,480.1 million, an increase of $0.26$104.0 million or 4.5%,7.6%, compared with $5.67$1,376.1 per diluted sharemillion in 2023.2024.
Diluted earnings per share for 2025 were $6.40, an increase of $0.47 or 7.9%, compared with $5.93 per diluted share in 2024.
EIG’s net sales totaled a record $4,659.9$4,919.1 million for 2024,2025, an increase of $35.6$259.2 million or 0.8%,5.6%, compared with $4,624.3$4,659.9 million in 2023.2024. The net sales increase was due to a 2%6% increase from acquisitions,acquisitions and a 1% favorable effect of foreign currency translation, partially offset by a 1% organic sales decrease.
EIG’s operating income was a record $1,428.4$1,447.1 million for 2024,2025, an increase of $117.4$18.7 million or 9.0%,1.3%, compared with $1,311.0$1,428.4 million in 2023.2024. EIG’s operating margins were a29.4% recordof net sales for 2025, compared with 30.7% of net sales forin 2024,2024. comparedEIG's withoperating 28.3%income was negatively impacted 100 basis points by the dilutive impact of netrecent salesacquisitions and 50 basis points for acquisition-related integration costs in 2023.2025. Excluding the dilutive impact of recent acquisitions and acquisition-related integration costs, EIG's operating margins increased 20 basis points in 20242025 compared to 20232024 due to the sales increase discussed above, as well as continued benefits from the Company's Operational Excellence initiatives.
EMG’s net sales totaled a record $2,281.3$2,482.0 million for 2024,2025, an increase of $308.6$200.7 million or 15.6%,8.8%, compared with $1,972.7$2,281.3 million in 2023.2024. The net sales increase was due to aan 20% increase from acquisitions, partially offset by a 5%8% organic sales decrease. The organic sales decrease for 2024 is due to customer inventory normalization in our automationincrease and engineereda solutions1% corefavorable businesses.effect of foreign currency translation.
EMG’s operating income was $456.5a record $578.9 million for 2024,2025, aan decreaseincrease of $40.1$122.4 million or 8.1%,26.8%, compared with $496.6$456.5 million in 2023.2024. EMG’s operating margins were 20.0%23.3% of net sales for 2024,2025, compared with 25.2%20.0% of net sales in 2023. EMG's operating margins were negatively impacted by the dilutive impact of the 2023 acquisitions.2024. EMG's operating income and operating margins for 2024 included $29.2 million of acquisition-related integration costs related to the Paragon acquisition, which negatively impacted segment operating margins by 130 basis points. The dilutive impact of the 2023 acquisitions negatively impacted EMG operating margins by 270 basis points in 2024. Excluding the dilutiveParagon impact of the 2023 acquisitions and the Paragonacquisition-related integration costs, EMG operating margins decreasedincreased 120200 basis points compared to 2023,2024, due to the organic sales decreaseincrease discussed above.above, as well as the continued benefits from the Company's Operational Excellence initiatives.
Cash provided by operating activities totaled $1,828.8$1,801.8 million in 2024,2025, ana increasedecrease of $93.5$27.0 million or 5.4%,1.5%, compared with cash provided by operating activities of $1,735.3$1,828.8 million in 2023.2024. The increasedecrease in cash provided by operating activities for 20232025 was primarily due to higher net income, net of higher noncash depreciation and amortization expense related to recent acquisitions, and improved working capital management.investments, partially offset by higher net income.
Cash used by investing activities totaled $244.8$1,062.8 million in 2024,2025, compared with cash used by investing activities of $2,376.4$244.8 million in 2023.2024. In 2024,2025, the Company paid $933.2 million, net of cash acquired, to purchase Kern Microtechnik and FARO Technologies, compared to $117.5 million, net of cash acquired, to purchase Virtek Vision International, compared to $2,237.9 million, net of cash acquired, to purchase Bison Gear & Engineering Corp., United Electronic Industries, Amplifier Research Corp. and Paragon MedicalInternational in 2023.2024. Additions to property, plant and equipment totaled $130.2 million in 2025, compared with $127.1 million in 2024, compared with $136.2 million in 2023.2024.
Cash used by financing activities totaled $1,602.5$686.3 million in 2024,2025, compared with $697.3$1,602.5 million of cash providedused by financing activities in 2023.2024. At December 31, 2024,2025, total debt, net was $2,079.7$2,283.3 million, compared with $3,313.3$2,079.7 million at December 31, 2023.2024. In 2024,2025, total borrowings decreasedincreased by $1,189.7$6.4 million, compared with ana increasedecrease of $892.3$1,189.7 million in 2023.2024. At December 31, 2024,2025, the Company had available borrowing capacity of $2,020.3$1,489.2 million under its revolving credit facility and term loan,facility, excluding the $700 million accordion feature. At December 31, 2025, the Company had $18.8 million outstanding on the revolver.
At December 31, 2024, the Company had $230.0 million outstanding on the revolver with a maturity date of May 2027. The amount outstanding under the revolver that the Company expects, but is not required, to repay in 2025 is recorded in current liabilities on the consolidated balance sheet at December 31, 2024.
In the third quarter of 2024, the Company paid in full, at maturity, a $300 million in aggregate principal amount of 3.73% senior notes. The debt-to-capital ratio was 17.7% at December 31, 2024, compared with 27.5% at December 31, 2023. The net debt-to-capital ratio (total debt, net less cash and cash equivalents divided by the sum of net debt and stockholders’ equity) was 15.0% at December 31, 2024, compared with 25.0% at December 31, 2023. The net debt-to-capital ratio is presented because the Company is aware that this measure is used by third parties in evaluating the Company. (See "Non-GAAP Financial Measures" for a reconciliation of U.S. GAAP measures to comparable non-GAAP measures).
In 2024, the Company repurchased approximately 1.2 million shares of its common stock for $212.0 million, compared with $7.8 million used for repurchases of approximately 0.1 million shares in 2023. At December 31, 2024, $604.1 million was available under the Company’s Board of Directors authorization for future share repurchases.
Additional financing activities for 2024 included cash dividends paid of $258.8 million, compared with $230.3 million in 2023. Effective February 9, 2024, the Company’s Board of Directors approved a 12% increase in the quarterly cash dividend on the Company’s common stock to $0.28 per common share from $0.25 per common share. Proceeds from the exercise of employee stock options were $66.9 million in 2024, compared with $50.9 million in 2023.
As a result of all of the Company’s cash flow activities in 2024, cash and cash equivalents at December 31, 2024 totaled $374.0 million, compared with $409.8 million at December 31, 2023. At December 31, 2024, the Company had $361.5 million in cash outside the United States, compared with $375.9 million at December 31, 2023. The Company utilizes this cash to fund its international operations, as well as to acquire international businesses. The Company is in compliance with all covenants, including financial covenants, for all of its debt agreements. The Company believes it has sufficient cash-generating capabilities from domestic and unrestricted foreign sources, available credit facilities and access to long-term capital funds to enable it to meet its operating needs and contractual obligations for the foreseeable future.
Subsequent Events
On January 6, 2025, the Company established a commercial paper program under which it may issue short-term, unsecured commercial paper notes. Amounts available under the commercial paper program may be borrowed, repaid and re-borrowed, with the aggregate face or principal amount of the notes outstanding under the commercial paper program at any time not to exceed $2.3 billion. The notes will have maturities of up to 364 days from the date of issue. TheAt December 31, 2025, the Company intendshad the$740.0 million outstanding under its commercial paper program to provide additional financing flexibility for various purposes including acquisitions. The Company expects that outstanding indebtedness of the Company under both the revolving credit facility and the commercial paper program will not exceed $2.3 billion at any time.program.
In the second quarter of 2025, the Company paid in full, at maturity, a $50.0 million in aggregate principal amount of 3.91% senior notes. In the third quarter of 2025, the Company paid in full, at maturity, a $100.0 million in aggregate principal amount of 3.96% senior notes. In the fourth quarter of 2025, the Company paid in full, at maturity, a $275.0 million in aggregate principal amount of 4.18% senior notes. The debt-to-capital ratio was 17.7% at December 31, 2025 and December 31, 2024. The net debt-to-capital ratio (total debt, net less cash and cash equivalents divided by the sum of net debt and stockholders’ equity) was 14.7% at December 31, 2025, compared with 15.0% at December 31, 2024. The net debt-to-capital ratio is presented because the Company is aware that this measure is used by third parties in evaluating the Company. (See "Non-GAAP Financial Measures" for a reconciliation of U.S. GAAP measures to comparable non-GAAP measures).
Effective February 7, 2025, the Company's Board of Directors approved an 11% increase in the quarterly cash dividend on its common stock to $0.31 per share from $0.28 per share.
In 2025, the Company repurchased approximately 2.3 million shares of its common stock for $443.0 million, compared with $212.0 million used for repurchases of approximately 1.2 million shares in 2024. Effective February 7, 2025, the Company's Board of Directors approved a $1.25 billion share repurchase authorization. ThisThe new authorization replaces the previous $1 billion share repurchase authorization approved in May 2022. At December 31, 2025, $807.0 million was available under the Company’s Board of Directors authorization for future share repurchases.
Additional financing activities for 2025 included cash dividends paid of $285.3 million, compared with $258.8 million in 2024. Effective February 7, 2025, the Company's Board of Directors approved an 11% increase in the quarterly cash dividend on its common stock to $0.31 per share from $0.28 per share. Proceeds from the exercise of employee stock options were $36.4 million in 2025, compared with $66.9 million in 2024.
As a result of all of the Company’s cash flow activities in 2025, cash and cash equivalents at December 31, 2025 totaled $458.0 million, compared with $374.0 million at December 31, 2024. At December 31, 2025, the Company had $374.5 million in cash outside the United States, compared with $361.5 million at December 31, 2024. The Company utilizes this cash to fund its international operations, as well as to acquire international businesses. The Company is in compliance with all covenants, including financial covenants, for all of its debt agreements. The Company believes it has sufficient cash-generating capabilities from domestic and unrestricted foreign sources, available credit facilities and access to long-term capital funds to enable it to meet its operating needs and contractual obligations for the foreseeable future.
In January 2026, the Company acquired LKC Technologies, a leading provider of innovative technology to enable effective diagnosis and management of ophthalmic conditions. LKC Technologies will join EIG.
Subsequent Event
Effective February 12, 2026, the Company's Board of Directors approved a 10% increase in the quarterly cash dividend on its common stock to $0.34 per share from $0.31 per share.
In January 2025, the Company acquired Kern Microtechnik ("Kern"), a leading manufacturer of high-precision machining and optical inspection solutions supporting a wide range of applications within the medical, semiconductor, research, and space markets. Kern has annual sales of approximately 50 million Euros. Kern will join EIG.
•Goodwill and Other Intangible Assets. Goodwill and other intangible assets with indefinite lives, primarily trademarks and trade names, are not amortized; rather, they are tested for impairment at least annually. The Company performs either a qualitative or quantitative analysis to determine if it is more likely than not that the fair values of its reporting units are less than the respective carrying values of those reporting units. The Company elected to bypass performing the qualitative screen and performed a quantitative analysis of the goodwill impairment test in the current year. The Company may elect to perform a qualitative analysis in future periods.
When testing goodwill for impairment, the Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not the estimated fair value of a reporting unit is less than its carrying amount. If the Company performs a qualitative assessment and determines that an impairment is more likely than not, then performance of a quantitative impairment test is required. In conducting a qualitative assessment, the Company analyzes actual and forecasted net sales and selling profit for each reporting unit, as well as historical performance and the results of prior quantitative tests performed. Additionally, the Company assesses critical areas that may impact its business, including macroeconomic conditions, industry and market conditions, cost factors, or any relevant events and factors that may impact projected financial results.
TheIf Companyperformed, principallythe reliesquantitative ongoodwill impairment test uses a discounted cash flow analysis to determine the fair value of each reporting unit, which considers cash flows discounted at an appropriate discount rate. The annual goodwill impairment test requires the Company to make a number of assumptions and estimates concerning future levels of revenue growth, operating margins, depreciation, amortization and working capital requirements, which are based on the Company’s long-range plan and are considered level 3 inputs. The discount rate is an estimate of the overall after-tax rate of return required by a market participant whose weighted average cost of capital includes both equity and debt, including a risk premium. While the Company uses the best available information to prepare its cash flow and discount rate assumptions, actual future cash flows or market conditions could differ significantly resulting in future impairment charges related to recorded goodwill balances. While there are always changes in assumptions to reflect changing business and market conditions, the Company’s overall methodology and the population of assumptions used have remained unchanged. In order to evaluate the sensitivity of the goodwill impairment test to changes in the fair value calculations, the Company applied a hypothetical 10% decrease in fair values of each reporting unit. The 2024 results (expressed as a percentage of carrying value for the respective reporting unit) showed that, despite the hypothetical 10% decrease in fair value, the fair values of the Company’s reporting units still exceeded their respective carrying values by 95% to 388%.
What changed in the latest 10-Q
Risk Factors
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Management's Discussion & Analysis (MD&A)
New heading “Indicor, LLC Agreement”
New heading “Results of operations for the first six months of 2026 compared with the first six months of 2025”
New heading “Segment Results”
New heading “Non-GAAP Financial Measures”
Removed heading “Acquisition subsequent to March 31, 2026”
Largest changes
“Results of operations for the first six months of 2026 compared with the first six months of 2025”see in full comparison
“On June 9, 2026, the Company along with certain of its foreign subsidiaries entered into an amended and restated revolving credit agreement (the “Revolving Credit Agreement”) and a separate term loan credit agreement (the “Term Loan Agreement”). The Revolving Credit Agreement increased the aggregate commitments from $2.3 billion to $3.5 billion and extended the maturity to June 9, 2031. …”see in full comparison
“EBITDA represents earnings before interest, income taxes, depreciation and amortization. EBITDA is presented because the Company is aware that it is used by rating agencies, securities analysts, investors and other parties in evaluating the Company. It should not be considered, however, as an alternative to operating income as an indicator of the Company’s operating performance or as an alternative to cash flows as a measure of the Company’s overall liquidity as presented in the Company’s consolidated financial statements. …”see in full comparison
Full comparison: every changed paragraph (61)
Recent geopolitical developments in the Middle East,developments, including the conflict involving Iran, have contributed to increased uncertainty in global markets. Although we have limited Middle East sales exposure and do not have material operations or assets located in the region, we are not immune to the broader macroeconomic uncertainty an extended conflict may create on the global economy.
Our businesses have been proactive in addressing the impacts of tariffs, including targeted pricing initiatives, strategic adjustments to our global supply chains, and leveraging our worldwide manufacturing footprint to localize production and adapt to changing demand patterns. While recent tariff-related changes did not have a material impact on our results of operations for the threesix months ended MarchJune 31,30, 2026, as the situation continues to evolve, we cannot be certain of the outcome, which could adversely impact demand for our products, costs, inflation, customers, suppliers, and the overall global economy. We continue to monitor and analyze the impacts of the tariffs and the evolving macroeconomic environment and will continue to implement appropriate actions as necessary to mitigate their effects on our businesses.
Indicor, LLC Agreement
On May 5, 2026, the Company announced that it has entered into a definitive agreement to acquire a portfolio of instrumentation business from Indicor, LLC ("Indicor Instrumentation") in an all-cash transaction valued at approximately $5.0 billion. Indicor Instrumentation is a collection of leading businesses that design and manufacture mission critical solutions for demanding industrial and scientific applications. Its products serve customers across end markets that align closely with the Company's existing portfolio of instrumentation businesses. Indicor Instrumentation has annual sales of approximately $1.1 billion. The transaction is subject to customary closing conditions, including applicable regulatory approvals, and is expected to close in the second half of 2026. Following closing of the transaction, the businesses will be integrated into the Company's EIG or EMG based on product offerings and market alignment.
For the quarter ended MarchJune 31,30, 2026, the Company posted record sales, operating income, net income, orders, and backlog, as well as strong operating margins. Contributions from the acquisitions of FARO Technologies ("FARO") in July 2025 and2025, LKC Technologies ("LKC") in January 20262026, and First Aviation Services ("First Aviation") in May 2026, as well as our Operational Excellence initiatives had a positive impact on the firstsecond quarter of 2026 results. TheIn the second quarter of 2026, the Company recorded $1.6$16.2 million of pre-tax acquisition-related costs related to the FAROFARO, acquisition,LKC, and First Aviation acquisitions, which are comprised of ongoing integration costs, in the first quarter of 2026.costs. These integration costs are recorded in Cost of sales and primarily include employee severance.severance and fair-value inventory adjustments.
Results of operations for the firstsecond quarter of 2026 compared with the firstsecond quarter of 2025
Net sales for the firstsecond quarter of 2026 were $1,928.4a record $2,044.4 million, an increase of $196.4$266.3 million or 11.3%,15.0%, compared with net sales of $1,732.0$1,778.1 million for the firstsecond quarter of 2025. The increase in net sales for the firstsecond quarter of 2026 was due to a 5%10% increase in organic sales, a 4% increase from acquisitions, as well as a 2%5% favorableincrease effectfrom of foreign currency translation.acquisitions.
Total international sales for the firstsecond quarter of 2026 were $923.7$963.7 million or 47.9%47.1% of net sales, an increase of $119.3$120.7 million or 14.8%,14.3%, compared with international sales of $804.4$843.0 million or 46.4%47.4% of net sales for the firstsecond quarter of 2025. The increase in international sales was primarily driven by higher demand in Europe and Asia, as well as contributions from recent acquisitions.
Orders for the firstsecond quarter of 2026 were a record $2,217.6$2,284.0 million, an increase of $419.8$501.9 million or 23.3%,28.2%, compared with $1,797.8$1,782.1 million for the firstsecond quarter of 2025. The increase in orders for the firstsecond quarter of 2026 was due to a 22%25% increase in organic orders,orders and a 2%6% increase from acquisitions, partially offset by a 1%3% unfavorable effect of foreign currency translation. The Company's backlog of unfilled orders at MarchJune 31,30, 2026 was a record $3,870.7$4,110.2 million, an increase of $289.2$528.7 million or 8.1%14.8% compared with $3,581.5 million at December 31, 2025.
Cost of sales for the firstsecond quarter of 2026 was $1,210.9$1,309.4 million or 62.8%64.0% of net sales, an increase of $103.9$167.2 million or 9.4%,14.6%, compared with $1,107.0$1,142.2 million or 63.9%64.2% of net sales for the firstsecond quarter of 2025. The cost of sales increase was primarily due to the net sales increase discussed above, partially offset by continued benefits from the Company's Operational Excellence initiatives.
Segment operating income for the firstsecond quarter of 2026 was $544.7$559.0 million, an increase of $61.9$70.7 million or 12.8%,14.5%, compared with segment operating income of $482.8$488.3 million for the firstsecond quarter of 2025. Segment operating margins, as a percentage of net sales, increaseddecreased to 28.2%27.3% for the firstsecond quarter of 2026, compared with 27.9%27.5% for the firstsecond quarter of 2025. Operating income and operating margins for the second quarter of 2026 included $16.2 million of acquisition-related integration costs related to the FARO, LKC, and First Aviation acquisitions ("recent acquisitions"), which negatively impacted operating margins by 80 basis points. In the firstsecond quarter of 2026, segment operating margins were negatively impacted 9080 basis points by the dilutive impact of recent acquisitions and 10 basis points from acquisition-related costs.acquisitions. Excluding the dilutive impact of recent acquisitions and acquisition-related costs, segment operating margins increased 130140 basis points compared to the firstsecond quarter of 2025 due to the sales increase discussed above, as well as continued benefits from the Company's Operational Excellence initiatives.
Selling, general and administrative expenses for the firstsecond quarter of 2026 were $202.6$206.8 million or 10.5%10.1% of net sales, an increase of $32.4$32.5 million or 19.1%,18.7%, compared with $170.2$174.3 million or 9.8% of net sales for the firstsecond quarter of 2025. Selling expenses increased primarily due to the net sales increase discussed above, as well as higher selling expense related to recent acquisitions. General and administrative expenses for the firstsecond quarter of 2026 were $29.8$30.8 million, compared with $27.9$26.7 million for the firstsecond quarter of 2025.
Consolidated operating income was a record $514.9 million or 26.7% of net sales for the first quarter of 2026, an increase of $60.1 million or 13.2%, compared with $454.8 million or 26.3% of net sales for the first quarter of 2025. In the first quarter of 2026, operating margins were negatively impacted 80 basis points by the dilutive impact of recent acquisitions and 10 basis points from acquisition-related costs. Excluding the dilutive impact of recent acquisitions and acquisition-related costs, operating margins increased 130 basis points compared to the first quarter of 2025 due to the sales increase discussed above, as well as continued benefits from the Company's Operational Excellence initiatives.
Interest expense for the first quarter of 2026 was $20.9 million, an increase of $1.9 million or 10.1%, compared with $19.0 million for the first quarter of 2025.
Other expense, net was $1.0 million for the first quarter of 2026, compared with $1.6 million of other expense, net for the first quarter of 2025.
The effective tax rate for the first quarter of 2026 and 2025 was 19.0%.
NetConsolidated operating income was $528.2 million or 25.8% of net sales for the firstsecond quarter of 2026 was $399.4 million,2026, an increase of $47.6$66.6 million or 13.5%,14.4%, compared with $351.8$461.6 million or 26.0% of net sales for the firstsecond quarter of 2025.
Interest expense for the second quarter of 2026 was $30.1 million, an increase of $13.2 million or 78.6%, compared with $16.9 million for the second quarter of 2025. Interest expense increased in the second quarter of 2026 primarily due to $10.0 million of fees associated with the bridge loan financing entered into in connection with the definitive agreement to acquire Indicor Instrumentation. The bridge loan was terminated in June 2026 following the execution of the Revolving Credit Agreement and the Term Loan Agreement. See Note 12 for additional information.
DilutedOther earningsexpense, pernet sharewas $5.7 million for the firstsecond quarter of 2026 were a record $1.74, an increase of $0.22 or 14.5%,2026, compared with $1.52$2.6 permillion dilutedof shareother expense, net for the firstsecond quarter of 2025.
The effective tax rate for the second quarter of 2026 was 17.4%, compared with 19.0% for the second quarter of 2025. The decrease in the quarterly effective tax rate was primarily driven by favorable international tax planning initiatives and favorable return to provision adjustments.
Net income for the second quarter of 2026 was a record $406.9 million, an increase of $48.5 million or 13.5%, compared with $358.4 million for the second quarter of 2025.
Diluted earnings per share for the second quarter of 2026 were a record $1.77, an increase of $0.22 or 14.2%, compared with $1.55 per diluted share for the second quarter of 2025.
EIG’s net sales totaled $1,264.5 million for the first quarter of 2026, an increase of $120.8 million or 10.6%, compared with $1,143.7 million for the first quarter of 2025. The net sales increase was due to a 2% organic sales increase, 7% increase from recent acquisitions, as well as a 1% favorable effect of foreign currency translation.
EIG’s operating income was $373.9 million for the first quarter of 2026, an increase of $19.8 million or 5.6%, compared with $354.1 million for the first quarter of 2025. EIG’s operating margins were 29.6% of net sales for the first quarter of 2026, compared with 31.0% for the first quarter of 2025. In the first quarter of 2026, EIG's operating margins were negatively impacted 140 basis points by the dilutive impact of recent acquisitions and 10 basis points from acquisition-related expenses. Excluding the dilutive impact of recent acquisitions and acquisition-related expenses, EIG's operating margins increased 10 basis points compared to the first quarter of 2025 due to the sales increase discussed above, as well as continued benefits from the Company's Operational Excellence initiatives.
EMG’sEIG’s net sales totaled a record $663.9$1,321.2 million for the firstsecond quarter of 2026, an increase of $75.6$161.6 million or 12.9%,13.9%, compared with $588.3$1,159.6 million for the firstsecond quarter of 2025. The net sales increase was due to a 11%7% organic sales increase,increase as well as a 2%7% favorableincrease effectfrom ofrecent foreign currency translation.acquisitions.
EMG’sEIG’s operating income was a record $170.8$369.7 million for the firstsecond quarter of 2026, an increase of $42.1$25.3 million or 32.7%,7.3%, compared with $128.7$344.4 million for the firstsecond quarter of 2025. EMG’sEIG’s operating margins were 25.7%28.0% of net sales for the firstsecond quarter of 2026, compared with 21.9%29.7% for the firstsecond quarter of 2025. EMG'sEIG's operating income and operating margins for the second quarter of 2026 included $15.0 million of acquisition-related integration costs related to the FARO and LKC acquisitions, which negatively impacted EIG's operating margins by 110 basis points. EIG's operating margins were negatively impacted 120 basis points in the second quarter of 2026 by the dilutive impact of recent acquisitions. Excluding the dilutive impact of recent acquisitions and acquisition-related costs, EIG's operating margins increased 38060 basis points compared to the firstsecond quarter of 2025 due to the sales increase discussed above, as well as continued benefits from the Company's Operational Excellence initiatives.
EMG’s net sales totaled a record $723.2 million for the second quarter of 2026, an increase of $104.7 million or 16.9%, compared with $618.5 million for the second quarter of 2025. The net sales increase was due to a 15% organic sales increase as well as a 2% increase from recent acquisitions.
EMG’s operating income was a record $189.3 million for the second quarter of 2026, an increase of $45.4 million or 31.6%, compared with $143.9 million for the second quarter of 2025. EMG’s operating margins were 26.2% of net sales for the second quarter of 2026, compared with 23.3% for the second quarter of 2025. EMG's operating income and operating margins for the second quarter of 2026 included $1.2 million of acquisition-related integration costs related to the First Aviation acquisition, which negatively impacted operating margins by 10 basis points. Excluding the impact of acquisition-related costs, EMG's operating margins increased 300 basis points compared to the second quarter of 2025 due to the sales increase discussed above, as well as continued benefits from the Company's Operational Excellence initiatives.
Results of operations for the first six months of 2026 compared with the first six months of 2025
Net sales for the first six months of 2026 were $3,972.8 million, an increase of $462.8 million or 13.2%, compared with net sales of $3,510.0 million for the first six months of 2025. The increase in net sales for the first six months of 2026 was due to an 8% organic sales increase, as well as a 5% increase from acquisitions.
Total international sales for the first six months of 2026 were $1,887.3 million or 47.5% of net sales, an increase of $239.8 million or 14.6%, compared with international sales of $1,647.5 million or 46.9% of net sales for the first six months of 2025. The increase in international sales was primarily driven by increased demand in Europe and Asia, as well as contributions from recent acquisitions.
Orders for the first six months of 2026 were $4,501.5 million, an increase of $921.7 million or 25.7%, compared with $3,579.8 million for the first six months of 2025. The increase in orders for the first six months of 2026 was due to a 24% organic order increase, a 4% increase from acquisitions, partially offset by a 2% unfavorable effect of foreign currency translation.
Cost of sales for the first six months of 2026 was $2,520.2 million or 63.4% of net sales, an increase of $271.1 million or 12.1%, compared with $2,249.1 million or 64.1% of net sales for the first six months of 2025. The cost of sales increase was primarily due to the net sales increase discussed above, partially offset by continued benefits from the Company's Operational Excellence initiatives.
Segment operating income for the first six months of 2026 was $1,103.7 million, an increase of $132.6 million or 13.7%, compared with segment operating income of $971.1 million for the first six months of 2025. Segment operating margins, as a percentage of net sales, increased to 27.8% for the first six months of 2026, compared with 27.7% for the first six months of 2025. Operating income and operating margins for the first six months of 2026 included $17.8 million of acquisition-related integration costs related to the FARO, LKC, and First Aviation acquisitions ("recent acquisitions"), which negatively impacted operating margins by 40 basis points. Segment operating margins were negatively impacted 80 basis points in the first six months of 2026 by the dilutive impact of recent acquisitions. Excluding the dilutive impact of the recent acquisitions and acquisition-related costs, segment operating margins increased 130 basis points compared to the first six months of 2025, due to the sales increase discussed above, as well as continued benefits from the Company's Operational Excellence initiatives.
Selling, general and administrative expenses for the first six months of 2026 were $409.5 million or 10.3% of net sales, an increase of $65.1 million or 18.9%, compared with $344.4 million or 9.8% of net sales for the first six months of 2025. Selling expenses increased primarily due to the net sales increase discussed above, as well as higher selling expense related to recent acquisitions. General and administrative expenses for the first six months of 2026 were $60.6 million, compared with $54.6 million for the first six months of 2025.
Consolidated operating income was $1,043.1 million or 26.3% of net sales for the first six months of 2026, an increase of $126.6 million or 13.8%, compared with $916.5 million or 26.1% of net sales for the first six months of 2025.
Interest expense for the first six months of 2026 was $51.0 million, an increase of $15.1 million or 42.2%, compared with $35.9 million for the first six months of 2025. Interest expense increased in the first six months of 2026 primarily due to $10.0 million of fees associated with the bridge loan financing entered into in connection with the definitive agreement to acquire Indicor Instrumentation. The bridge loan was terminated in June 2026 following the execution of the Revolving Credit Agreement and the Term Loan Agreement. See Note 12 for additional information.
Other expense, net was $6.8 million for the first six months of 2026, compared with $4.2 million of other expense, net for the first six months of 2025.
The effective tax rate for the first six months of 2026 was 18.2%, compared with 19.0% for the first six months of 2025. The lower effective tax rate in the first six months of 2026 was primarily attributable to favorable international tax planning initiatives and favorable return to provision adjustments.
Net income for the first six months of 2026 was $806.3 million, an increase of $96.2 million or 13.5%, compared with $710.1 million for the first six months of 2025.
Diluted earnings per share for the first six months of 2026 were $3.51, an increase of $0.44 or 14.3%, compared with $3.07 per diluted share for the first six months of 2025.
Segment Results
EIG’s net sales totaled $2,585.7 million for the first six months of 2026, an increase of $282.5 million or 12.3%, compared with $2,303.2 million for the first six months of 2025. The net sales increase was due to a 7% increase from acquisitions, as well as a 5% increase in organic sales.
EIG’s operating income was $743.7 million for the first six months of 2026, an increase of $45.2 million or 6.5%, compared with $698.5 million for the first six months of 2025. EIG’s operating margins were 28.8% of net sales for the first six months of 2026, compared with 30.3% for the first six months of 2025. EIG's operating income and operating margins for the first six months of 2026 included $16.6 million of acquisition-related integration costs related to the FARO and LKC acquisitions, which negatively impacted EIG's operating margins by 60 basis points. EIG's operating margins were negatively impacted 130 basis points in the first six months of 2026 by the dilutive impact of recent acquisitions. Excluding the dilutive impact of recent acquisitions and acquisition-related costs, EIG's operating margins increased 40 basis points in the first six months of 2026 compared to the first six months of 2025 due to the sales increase discussed above, as well as continued benefits from the Company's Operational Excellence initiatives.
EMG’s net sales totaled $1,387.1 million for the first six months of 2026, an increase of $180.4 million or 14.9%, compared with $1,206.8 million for the first six months of 2025. The net sales increase was due to a 13% increase in organic growth, a 1% increase from acquisitions, as well as a 1% favorable effect of foreign currency translation.
EMG’s operating income was $360.1 million for the first six months of 2026, an increase of $87.5 million or 32.1%, compared with $272.6 million for the first six months of 2025. EMG’s operating margins were 26.0% of net sales for the first six months of 2026, compared with 22.6% for the first six months of 2025. EMG's operating income and operating margins for the first six months of 2026 included $1.2 million of acquisition-related integration costs related to First Aviation. EMG's operating margins increased 340 basis points compared to the first six months of 2025, due to the sales increase discussed above, as well as to the continued benefits from the Company's Operational Excellence initiatives.
Cash provided by operating activities totaled $451.5$935.2 million for the first threesix months of 2026, an increase of $34.0$158.6 million or 8.1%,20.4%, compared with $417.5$776.6 million for the first threesix months of 2025. The increase in cash provided by operating activities for the first threesix months of 2026 was primarily due to higher net income, partiallyas offsetwell byas higherreduced investments in working capital requirements.capital.
Free cash flow (cash flow provided by operating activities less capital expenditures) was $426.0$877.7 million for the first threesix months of 2026, compared with $394.4$724.3 million for the first threesix months of 2025. EBITDA (earnings before interest, income taxes, depreciation and amortization) was $618.3$1,245.7 million for the first threesix months of 2026, compared with $558.5$1,123.6 million for the first threesix months of 2025. Free cash flow and EBITDA are presented because the Company is aware that they are measures used by third parties in evaluating the Company.
Cash used by investing activities totaled $234.6$481.5 million for the first threesix months of 2026, compared with cash used by investing activities of $125.7$155.7 million for the first threesix months of 2025. For the first threesix months of 2026, the Company paid $209.6$424.5 million, net of cash acquired, to purchase LKC Technologies.Technologies in January 2026 and First Aviation Services, Inc. in May 2026. For the first threesix months of 2025, the Company paid $103.2$104.1 million, net of cash acquired, to purchase Kern Microtechnik. Additions to property, plant and equipment totaled $25.5$57.5 million for the first threesix months of 2026, compared with $23.1$52.3 million for the first threesix months of 2025.
Cash used by financing activities totaled $188.0$408.1 million for the first threesix months of 2026, compared with cash used by financing activities of $277.7$409.4 million for the first threesix months of 2025. At MarchJune 31,30, 2026, total debt, net was $2,177.5$2,036.2 million, compared with $2,283.3 million at December 31, 2025. For the first threesix months of 2026, total borrowings decreased by $82.7$208.7 million compared with a $185.1$252.7 million decrease for the first threesix months of 2025. At March 31, 2026, the Company had available borrowing capacity of $1,573.4 million under its revolving credit facility, excluding the $700 million accordion feature.
On June 9, 2026, the Company along with certain of its foreign subsidiaries entered into an amended and restated revolving credit agreement (the “Revolving Credit Agreement”) and a separate term loan credit agreement (the “Term Loan Agreement”). The Revolving Credit Agreement increased the aggregate commitments from $2.3 billion to $3.5 billion and extended the maturity to June 9, 2031. The facility is subject to customary financial and restrictive covenants and may be used for general corporate purposes, including working capital, debt refinancing, and up to $1.0 billion to fund a portion of the consideration for the previously announced acquisition of Indicor Holdings, LLC (the “Indicor Acquisition”). At June 30, 2026, the Company had available borrowing capacity of $2,904.2 million under its revolving credit facility.
The Term Loan Agreement provides for a senior unsecured term loan facility of up to $4.0 billion, consisting of three tranches: $1.625 billion maturing three years after funding, $1.625 billion maturing four years after funding, and $750 million maturing five years after funding. Funding under the Term Loan Agreement is subject to customary conditions, including the consummation of the Indicor Acquisition, and the proceeds may be used solely to finance the acquisition. The term loans will be available in a single borrowing on the closing date of the Indicor Acquisition. At June 30, 2026, the Company had no borrowings outstanding under the term loans.
The debt-to-capital ratio was 16.6%15.3% at MarchJune 31,30, 2026, compared with 17.7% at December 31, 2025. The net debt-to-capital ratio (total debt, net less cash and cash equivalents divided by the sum of net debt and stockholders’ equity) was 13.4%12.0% at MarchJune 31,30, 2026, compared with 14.7% at December 31, 2025. The net debt-to-capital ratio is presented because the Company is aware that this measure is used by third parties in evaluating the Company.
Additional financing activities for the first threesix months of 2026 included cash dividends paid of $77.8$155.7 million, compared with $71.5$143.0 million for the first threesix months of 2025. Effective February 12, 2026, the Company’s Board of Directors approved ana 10% increase in the quarterly cash dividend on the Company’s common stock to $0.34 per common share from $0.31 per common share. The Company repurchasedused $27.9$28.1 million ofto repurchase its common stock for the first threesix months of 2026, compared with $18.0$18.1 million for the first threesix months of 2025. Proceeds from stock option exercises were $9.6$20.8 million for the first threesix months of 2026, compared with $4.7$12.3 million for the first threesix months of 2025.
As a result of all of the Company’s cash flow activities for the first threesix months of 2026, cash and cash equivalents at MarchJune 31,30, 2026 totaled $481.3$495.4 million, compared with $458.0 million at December 31, 2025. At MarchJune 31,30, 2026, the Company had $380.5$440.1 million in cash outside the United States, compared with $374.5 million at December 31, 2025. The Company utilizes this cash to fund its international operations, as well as to acquire international businesses. The Company is in compliance with all covenants, including financial covenants, for all of its debt agreements. The Company believes it has sufficient cash-generating capabilities from domestic and unrestricted foreign sources, available credit facilities and access to long-term capital funds to enable it to meet its operating needs and contractual obligations in the foreseeable future.
Non-GAAP Financial Measures
EBITDA represents earnings before interest, income taxes, depreciation and amortization. EBITDA is presented because the Company is aware that it is used by rating agencies, securities analysts, investors and other parties in evaluating the Company. It should not be considered, however, as an alternative to operating income as an indicator of the Company’s operating performance or as an alternative to cash flows as a measure of the Company’s overall liquidity as presented in the Company’s consolidated financial statements. Furthermore, EBITDA measures shown for the Company may not be comparable to similarly titled measures used by other companies. The following table presents the reconciliation of net income reported in accordance with U.S. generally accepted accounting principles (“GAAP”) to EBITDA:
Free cash flow represents cash flow from operating activities less capital expenditures. Free cash flow is presented because the Company is aware that it is used by rating agencies, securities analysts, investors and other parties in evaluating the Company. The following table presents the reconciliation of cash flow from operating activities reported in accordance with U.S. GAAP to free cash flow:
Net debt represents total debt, net minus cash and cash equivalents. Net debt is presented because the Company is aware that it is used by rating agencies, securities analysts, investors and other parties in evaluating the Company. The following table presents the reconciliation of total debt, net reported in accordance with U.S. GAAP to net debt:
Acquisition subsequent to March 31, 2026
AME insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 1 Form 4 filing (1 insider, 1 trade date, 4,000 shares, about $1.0M) and open-market sales in 1 filing (1 insider, 1 trade date, 6,608 shares, about $1.7M). Net open-market shares: -2,608 (purchases minus sales); net value about -$655.0K.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-08-11 | Stanage Nick L |
Open-market purchase | 4,000 | $255.85 | $1.0M |
| 2026-08-07 | Hermance David F. |
Option exercise | 6,608 | $85.45 | $564.7K |
| 2026-08-07 | Hermance David F. |
Open-market sale | 6,608 | $254.00 | $1.7M |
| 2026-05-27 | Oscher Ronald J |
Other | 39,954 | — | — |
| 2026-05-27 | Oscher Ronald J |
Other | 39,954 | — | — |
| 2026-05-07 | Stanage Nick L |
Grant/award | 760 | $234.73 | $178.4K |
Well-known investors holding AME (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 1,375,088 | $329.7M | 0.11% | Added 32% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 1,117,983 | $270.5M | 0.16% | Reduced 23% |
| PRIMECAP Management | 2026-06-30 | 823,154 | $199.2M | 0.12% | No change |
| Millennium Management (Israel Englander) | 2026-06-30 | 783,287 | $189.5M | 0.13% | Added 112% |
| D. E. Shaw & Co. | 2026-06-30 | 591,116 | $143.0M | 0.09% | Reduced 34% |
| Point72 Asset Management (Steve Cohen) | 2026-06-30 | 480,357 | $116.2M | 0.18% | Added 28% |
| Two Sigma Investments | 2026-06-30 | 406,681 | $98.4M | 0.07% | Reduced 75% |
| Gotham Asset Management (Joel Greenblatt) | 2026-06-30 | 184,571 | $44.7M | 0.1% | Added 25% |
| Renaissance Technologies | 2026-06-30 | 181,950 | $44.0M | 0.06% | Reduced 41% |
| Bridgewater Associates | 2026-06-30 | 117,720 | $28.5M | 0.12% | Added 1% |
| ARK Investment Management (Cathie Wood) | 2026-06-30 | 4,186 | $1.0M | 0.01% | Reduced 18% |