CTAS 10-K & 10-Q changes, risk factors and insider trading

This Annual Report on Form 10-K contains forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a safe harbor from civil litigation for forward-looking statements. Forward-looking statements may be identified by wordswords, terms or expressions such as “estimates,” "confident," "continue," "hope," "likely," "might," "possible," "potential," "trend," “anticipates,” “predicts,” “projects,” “plans,” “expects,” “intends,” “target,targets,” “forecast,forecasts,” “believes,” “seeks,” “could,” “should,” “maymay,” "strategy," and “will"objective” or the negative versions thereof and similar words, terms and expressions and by the context in which they are used. Such statements are based upon current expectations of Cintas and speak only as of the date made. You should not place undue reliance on any forward-looking statement. We cannot guarantee that any forward-looking statement will be realized. These statements are subject to various risks, uncertainties, potentially inaccurate assumptions and other factors that could cause actual results to differ materially from those set forth in or implied by this Annual Report. Factors that are related to the Transaction that might cause such a difference include, but are not limited to, the occurrence of any event, change, or other circumstance that could give rise to the right of one or both of the parties to terminate the definitive merger agreement between Cintas and UniFirst; the outcome of any legal proceedings that may be instituted against Cintas or UniFirst; the possibility that the Transaction does not close when expected or at all because required regulatory, or other approvals and other conditions to closing are not received or satisfied on a timely basis or at all (and the risk that seeking or obtaining such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the Transaction); the risk that the benefits from the Transaction may not be fully realized or may take longer to realize than expected, including as a result of changes in, or problems arising from, general economic and market conditions, interest and exchange rates, monetary policy, trade policy (including tariff levels), laws and regulations and their enforcement, and the degree of competition in the geographic and business areas in which Cintas and UniFirst operate; any failure to promptly and effectively integrate the businesses of Cintas and UniFirst; the possibility that the Transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; reputational risk and potential adverse reactions of Cintas' or UniFirst's customers, employees or other business partners, including those resulting from the announcement, pendency or completion of the Transaction; the dilution caused by Cintas' issuance of additional shares of its capital stock in connection with the Transaction; changes in the trading price of Cintas' or UniFirst's capital stock; and the diversion of management's attention and time to the Transaction from ongoing business operations and opportunities. Additional factors that might cause such a difference include, but are not limited to, the possibility of greater than anticipated operating costs including energy and fuel costs; lower sales volumes; loss of customers due to outsourcing trends; the performance and costs of integration of acquisitions; supply chain constraints and macroeconomic conditions, including inflationary pressures and higher interest rates; changes in global trade policies, tariffs and other measures that could restrict international trade; fluctuations in costs of materials and labor, including increased medical costs; costs and possible effects of union organizing activities; failure to comply with government regulations concerning employment discrimination, employee pay and benefits and employee health and safety; the effect on operations of exchange rate fluctuations, tariffs and other political, economic and regulatory risks; uncertainties regarding any existing or newly-discovered expenses and liabilities related to environmental compliance and remediation; our ability to meet our aspirations relating to sustainability opportunities, improvements and efficiencies; the cost, results and ongoing assessment of internal controls forover financial reporting; the effect of new accounting pronouncements; risks associated with cybersecurity threats, including disruptions caused by the inaccessibility of computer systems data and cybersecurity risk management; the initiation or outcome of litigation, investigations or other proceedings; higher assumed sourcing or distribution costs of products; the disruption of operations from catastrophic or extraordinary events including global health pandemics; the amount and timing of repurchases of our common stock, if any; changes in global tax and labor laws; and the reactions of competitors in terms of price and service. Cintas undertakes no obligation to publicly release any revisions to any forward-looking statements or to otherwise update any forward-looking statements whether as a result of new information or to reflect events, circumstances or any other unanticipated developments arising after the date on which such statements are made, except otherwise as required by law. These risks and uncertainties include, but are not limited to, those described in this section and elsewhere in this report and may also be described from time to time in our future reports filed with the SEC. The risks and uncertainties described herein are not the only ones we may face. Additional risks and uncertainties presently not known to us or that we currently believe to be immaterial may also harm our business. Forward-looking and other statements in this Annual Report on Form 10-K regarding our greenhouse gas (GHG) reduction plans and other sustainability aspirations are not an indication that these statements are necessarily material to investors or required to be disclosed in our filings with the SEC. In addition, historical, current and forward-looking GHG-related and/or sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve and assumptions that are subject to change in the future.

Negative economic conditions, in North America and our other markets, have in the past and could again in the future, adversely affect our financial performance. Higher levels of unemployment, inflation, recessionary conditions, geopolitical developments, changes in trade agreements, tax rates and other changes in tax laws and other economic factors could adversely affect the demand for Cintas’Cintas' products and services. Increases in labor costs, including the cost to provide employee-partner related healthcare benefits, minimum wages, labor shortages or shortages of skilled labor, regulations regarding the classification of employees and/or their eligibility for overtime wages, higher material costs for items such as fabrics and textiles, the inability to obtain insurance coverage at cost-effective rates, higher interest rates, inflation, new or expanded tariffs and other measures that could restrict international trade, higher tax rates and other changes in tax laws and other economic factors could increase our costs of rental uniforms and facility services, cost of other services and selling and administrative expenses. As a result, these factors could adversely affect our revenue and consolidated results of operations.

Historically, a portion of our growth has come from acquisitions. We continue to evaluate opportunities for acquiring businesses that may supplement our internal growth. However, there can be no assurance that we will be able to identify and purchase suitable acquisitions. In addition, the success of any acquisition, including the ability to realize anticipated cost synergies, depends in part on our ability to integrate the acquired company. The process of integrating acquired businesses may involve unforeseen difficulties and may require a disproportionate amount of our management's attention and our financial and other resources. If management is not able to effectively manage the integration process, or if any significant business activities are interrupted as a result of the integration process, we may not be able to realize anticipated cost synergies resulting from acquisitions and our business could suffer. Although we conduct due diligence investigations prior to each acquisition, there can be no assurance that we will discover or adequately protect against all material liabilities of an acquired business for which we may be responsible as a successor owner or operator. The failure to identify suitable acquisitions and successfully integrate these acquired businesses, or to discover liabilities associated with such businesses in the diligence process, could adversely affect our consolidated results of operations.

Our businesses rely on various information technology systems, including third-party systems, to provide customer information, process customer transactions and provide other general information necessary to manage our businesses. Our information technology systems are subject to damage or interruption due to cybersecurity attacks, system conversions, power outages, computer or telecommunication failures, catastrophic events such as fires, tornadoes and hurricanes and usage errors by our employees.employee-partners. Although we have an active disaster recovery plan in place that is frequently reviewed and tested, and we believe that we have adopted appropriate measures designed to mitigate potential risks to our technology and our operations from these information technology-related and other potential disruptions, given the unpredictability of the timing, nature and scope of such disruptions, we could potentially be subject to production downtimes, operational delays and interruptions in our ability to provide products and services to our customers. Any disruption caused by the unavailability of our information technology systems could adversely affect our revenue, could require us to make a significant investment to fix or replace them and, therefore, could adversely affect our consolidated results of operations.

We have experienced cybersecurity incidents in the past, but none of these incidents, individually or in the aggregate, have had a material adverse effect on our business or results of operations. However, there can be no assurance that we will not experience material cybersecurity incidents in the future. If the network of security controls, policy enforcement mechanisms and monitoring systems to address these threats to our technology fails, or we are unable to successfully address cybersecurity incidents or the risks from cybersecurity threats, we could experience production downtimes, operational delays and interruptions in our ability to provide products and services to our customers, the compromising of confidential or otherwise protected Company, customer, or employeeemployee-partner information, destruction or corruption of data, security incidents, or other manipulation or improper use of our systems and networks which could result in financial losses from remedial actions, loss of business or potential liability and damage to our reputation.

We believe that a key component of our success is our corporate culture, which has been imparted by management throughout our corporate organization. Our corporate culture, along with our entire operation, depends on our ability to attract, develop and retain key employee-partners. Competitive pressures and labor shortages within and outside our industry may make it more difficult and expensive for us to attract and retain key employee-partners which could adversely affect our businesses. Our ability to attract, retain, and motivate employee-partners may also be adversely affected by stock price volatility. In addition, the pendency of the Transaction may cause our current and prospective employee-partners to experience uncertainty about their roles after the completion of the Transaction, which may have an adverse effect on our ability to attract, motivate or retain management personnel and other key employee-partners.

Our outstanding indebtedness along with adverse interest rate fluctuations may have negative consequences on our business, such as requiring us to dedicate a substantial portion of our cash flow from operations to the payment of debt service, reducing the availability of our cash flow to fund working capital, capital expenditures, acquisitions, dividend increases, stock buybacks and other general corporate purposes, as well as increasing our vulnerability to adverse economic or industry conditions. In addition, it may limit our ability to obtain additional financing in the future to enable us to react to changes in our business or industry or place us at a competitive disadvantage compared to businesses in our industry that have less debt. In connection with the proposed Transaction, we expect to incur approximately $2.8 billion in additional indebtedness and, if incurred, would have consolidated indebtedness of approximately $5.2 billion, which is greater than our current indebtedness. Any such increase in indebtedness in comparison to our indebtedness on a historical basis may have the effect of, among other things, reducing our flexibility to respond to changing business and economic conditions and increasing borrowing costs. In addition, any new financing arrangements that we enter into in connection with the proposed Transaction, may, under certain circumstances, impose significant operating and financial restrictions on us. Any such restrictions may affect our ability to operate our business and may limit our ability to take advantage of potential business opportunities as they arise.

Fiscal 20252026 total revenue was $10.3$11.3 billion, an increase of 7.7%8.9% over the prior fiscal year. Revenue increased organically by 8.0%8.3% primarily as a result of increased sales volume. Organic revenue growth adjusts for the impact of acquisitions, workday differencesacquisitions and foreign currency exchange rate fluctuations. Total revenue was positively impacted by 0.8%0.6% due to acquisitions, negatively impacted by 0.9% due to two less workdays in fiscal 2025 compared to fiscal 2024 and negatively impacted by 0.2% due to foreign currency exchange rate fluctuations.acquisitions.

Uniform Rental and Facility Services reportable operating segment revenue consists predominantly of revenue derived from the rental of corporate identity uniforms and other garments, including flame resistant clothing and the rental and/or sale of mats, mops, shop towels, restroom supplies and other rental services. Revenue from the Uniform Rental and Facility Services reportable operating segment increased 6.8%,8.1%, to $8,621.6 million compared to $7,976.1 million compared to $7,465.2 million in fiscal 2024.2025. Organic revenue growth for this reportable operating segment was 7.0%.7.6%. Revenue growth was positively impacted by 0.8%0.4% due to acquisitions, negatively impacted by 0.9% due to two less workdays in fiscal 2025 compared to fiscal 2024acquisitions and negatively impacted by 0.1% due to foreign currency exchange rate fluctuations. Revenue growth was a result of new business, the penetration of additional products and services into existing customers and price increases, partially offset by lost business. New business growth resulted from an increase in the number and productivity of sales representatives. Generally, sales productivity improvements are due to increased tenure and improved training, which produce a higher number of products and services sold.

Other revenue, consisting of revenue from the First Aid and Safety Services reportable operating segment and All Other, increased 10.9%,11.8%, to $2,643.1 million compared to $2,364.1 million compared to $2,131.4 million in fiscal 2024.2025. Revenue improved from increases in sales representative productivity and price increases. Revenue increased organically by 11.3%.10.6%. Revenue growth was positively impacted by 0.6%1.2% due to acquisitions, negatively impacted by 0.9% due to two less workdays in fiscal 2025 compared to fiscal 2024 and negatively impacted by 0.1% due to foreign currency exchange rate fluctuations.acquisitions.

Cost of uniform rental and facility services increased 4.5%6.7% compared to fiscal 2024.2025. Cost of uniform rental and facility services consists primarily of production expenses, delivery expenses and the amortization of in-service inventory, including uniforms, mats, shop towels and other ancillary items. The change from the prior year was primarily due to higher Uniform Rental and Facility Services reportable operating segment sales volume, as well as an increase in material cost to support increased revenue growth. TheAs a percent of revenue, the cost of uniform rental and facility services as a percent of revenue improved comparedfrom 50.7% in fiscal 2025, to 50.0% in fiscal 2024 from 51.8% to 50.7%2026, primarily due to efficiency gains in energy usage, more efficient use of in-service inventory and production efficiency gains.

Selling and administrative expenses increased $196.7$271.7 million, to 27.2%27.4% as a percent of revenue, compared to 27.3%27.2% in fiscal 2024.2025. In fiscal 2025 we recorded a $15$15.0 million gain on a sale of property, and in fiscal 2024 we recorded $15 million associated with a legal settlement, both ofproperty which impacted all segments by the same percent of revenue.revenue of approximately 0.2%. Excluding thosethat items,gain on the sale of property, selling and administrative expenses aswere a percent of revenue increasedconsistent from fiscal 20242025 to fiscal 2025. The resulting increase as a percent of revenue was primarily due to investments in technology and additional selling resources.2026.

Net interest expense (interest expense less interest income) was $101.2 million in fiscal 2026 compared to $95.5 million in fiscal 2025 compared to $95.0 million in fiscal 2024. Net interest expensebut was the same as a percent of revenue.

Net income for fiscal 20252026 of $1,812.3$2,000.0 million was a 15.3%10.4% increase compared to fiscal 2024.2025. Diluted earnings per share of $4.40$4.91 was aan 16.1%11.6% increase compared to fiscal 20242025 diluted earnings per share of $3.79.$4.40. Diluted earnings per share increased primarily due to the increase in net income.

Uniform Rental and Facility Services reportable operating segment revenue increased $510.9$645.6 million, or 6.8%,8.1%, and the cost of uniform rental and facility services increased $175.8$271.2 million, or 4.5%,6.7%, due to the reasons previously discussed. The reportable operating segment's fiscal 20252026 gross margin was 49.3%50.0% of revenue compared to 48.2%49.3% in fiscal 2024.2025. The improvement in gross margin was primarily due to efficiency gains in energy usage, more efficient use of in-service inventory and production efficiency gains.

Selling and administrative expenses for the Uniform Rental and Facility Services reportable operating segment increased $121.2$170.7 million in fiscal 20252026 compared to fiscal 20242025 in order to support revenue growth as well as invest in technology and selling resources. Selling and administrative expense as a percent of revenue for fiscal 20252026 was 25.8%25.9% compared to 26.0%25.8% in fiscal 2024.2025. Excluding the itemsgain on sale of property noted previously, selling and administrative expenses as a percent of revenue were largely consistent as compared to the prior fiscal year.

Income beforeOperating income taxes for the Uniform Rental and Facility Services reportable operating segment increased $213.9$203.6 million, or 12.9%,10.9%, for fiscal 20252026 compared to fiscal 2024.2025. The increase in income beforeoperating income taxes was due to the previously discussed growth in revenue and improvements in gross margin. Income beforeOperating income taxes as a percent of revenue was 23.5%24.1% compared to 22.2%23.5% in fiscal 2024.2025. The improvement over the prior fiscal year was primarily a result of the previously discussed improvement in gross margin.

First Aid and Safety Services reportable operating segment revenue increased $150.8$173.8 million in fiscal 2025,2026, a 14.1%14.3% increase compared to fiscal 2024.2025. Organic revenue growth for this reportable operating segment was 15.0%.14.0%. Revenue growth was positively impacted by 0.1%0.3% due to acquisitions, negatively impacted by 0.9% due to two less workdays in fiscal 2025 compared to fiscal 2024 and negatively impacted by 0.1% due to foreign currency exchange rate fluctuations.acquisitions. The increase in revenue was driven by many factors including increases in new business sold by sales representatives, penetration of additional products and services into existing customers, price increases and strong customer retention.

Selling and administrative expenses for the First Aid and Safety Services reportable operating segment increased by $48.4$47.2 million, or 13.7%,11.7%, in fiscal 20252026 compared to fiscal 2024,2025, but decreased as a percent of revenue to 32.3% in fiscal 2026 compared to 33.0% in fiscal 20252025. comparedThe to 33.1%improvement in fiscal 2024. Excluding the items noted previously, selling and administrative expenses as a percent of revenue werewas largely consistentdue to operating leverage as comparedrevenue togrew theat priora fiscalfaster year.rate than expenses.

Income beforeOperating income taxes for the First Aid and Safety Services reportable operating segment was $294.7$353.4 million in fiscal 2025,2026, an increase of $55.6$58.7 million, or 23.2%,19.9%, compared to fiscal 2024.2025. Income beforeOperating income taxes as a percent of revenue at 24.2%,25.4%, increased from 22.4%24.2% in fiscal 20242025 due to the previously discussed growth in revenue and improvements in gross margin.margin and selling and administrative expenses.

We expect our cash flows from operating activities to remain sufficient to provide us with adequate levels of liquidity. In addition, we have access to $2.0 billion of debt capacity from our amended and restated revolving credit facility.facility under our credit agreement. We believe the Company has sufficient liquidity to operate in the current business environment for at least the next 12 months and the foreseeable future thereafter. Acquisitions, repurchases of our common stock and dividends remain strategic objectives, but they will be dependent on the economic outlook and liquidity of the Company.

Net cash provided by operating activities was $2,165.9$2,276.3 million for fiscal 2025,2026, which was an increase of $97.4$110.4 million, or 4.7%,5.1%, compared to fiscal 2024.2025. The increase was primarily the result of an increase in net income, deferred income taxes and favorable changes in working capital, primarily income taxes, current, accounts payablereceivable, net, and accruedinventories, compensation and related liabilities.net. These improvements were partially offset by unfavorable changes in working capital, specifically inventories, net, accounts receivable,payable, netaccrued liabilities and other, and uniforms and other rental items in service.

Net cash used in investing activities was $568.4 million in fiscal 2026, compared to $623.6 million in fiscal 2025, compared to $603.3 million in fiscal 2024.2025. Net cash used in investing activities includes capital expenditures, purchases of investments and cash paid for acquisitions of businesses. These outflows were partially offset by proceeds from the sale of property. Capital expenditures were $408.9$395.1 million and $409.5$408.9 million for fiscal 20252026 and fiscal 2024,2025, respectively. Capital expenditures for fiscal 20252026 included $301.6$279.4 million for the Uniform Rental and Facility Services reportable operating segment and $55.4$59.0 million for the First Aid and Safety Services reportable operating segment. Cash paid for acquisitions of businesses, net of cash acquired, was $232.9$164.5 million and $186.8$232.9 million for fiscal 20252026 and fiscal 2024,2025, respectively. The acquisitions in both fiscal 20252026 and 20242025 occurred in our Uniform Rental and Facility Services reportable operating segment, our First Aid and Safety Services reportable operating segment and our Fire Protection operating segment, which is included in All Other. In addition, during fiscal 2025, Cintas received cash proceeds of $24.0 million related to the sale of property and equipment. Net cash used in investing activities also included $7.2$8.3 million and $7.5$7.2 million of purchases of investments during fiscal 20252026 and fiscal 2024,2025, respectively.

Net cash used in financing activities was $1,619.0$1,682.1 million for fiscal 2025,2026, compared to $1,247.5$1,619.0 million in fiscal 2024.2025. The increase in cash used in financing activities was primarily due to the increase in repayment of debt, share buyback activity and an increase in dividends paid.paid, Theserepurchases increasesof werecommon partiallystock offsetand by an increase in proceeds from thedebt issuance of debt in fiscal 2025 compared to fiscal 2024.costs.

Cintas announced on July 27, 2021, that the Board authorized a $1.5 billion share buyback program, which was completed during the fourth quarter of fiscal 2024. On July 26, 2022 and2022, July 23, 2024,2024 and October 28, 2025, Cintas announced that the Board authorized new share buyback programs, each for $1.0 billion. The July 26, 2022 share buyback program was completed during the second quarter of fiscal 2026. Neither of the outstanding share buyback programs have an expiration date.

There were no share buybacks inIn the period subsequent to May 31, 2025,2026, through July 28,29, 2025.2026, we purchased 0.2 million shares of Cintas common stock at an average price of $199.70 per share, for a total purchase price of $48.4 million. From the inception of the July 26,23, 20222024 share buyback program through July 28,29, 2025,2026, Cintas has purchased 4.12.9 million shares of Cintas common stock in the aggregate, at an average price of $178.20$191.99 per share, for a total purchase price of $736.4$562.7 million. Cintas has made no purchases under the JulyOctober 23,28, 20242025 share buyback program.

Our Board of Directors declared the following dividends:

TheCintas Corporation No. 2 (Corp. 2) entered into a credit agreement thatwhich supports our commercial paper program on March 27, 2026 (the Credit Agreement). The Credit Agreement has capacity under the revolving credit facility of $2.0 billion.billion and contains a letter of credit sub-facility of up to $300.0 million and a swing line sub-facility of up to $150.0 million. The creditCredit agreementAgreement has an accordion feature that provides Cintas with the ability to request increases to the borrowing commitments under the revolving credit facility of up to $500.0$1.0 millionbillion in the aggregate, subject to customary conditions. The maturity date of the revolving credit facility is March 27, 2031. In connection with the entry into the Credit Agreement, on March 27, 2026, Corp. 2 terminated all commitments and repaid all obligations under its existing Third Amended and Restated Credit Agreement, dated as of March 23, 2027.2022 (as amended, restated, supplemented or otherwise modified from time to time prior to such date, the “Existing Credit Agreement”). Upon the termination of the Existing Credit Agreement, all the obligations under the Existing Credit Agreement were terminated. As of both May 31, 20252026 and 2024,2025, there was no commercial paper outstanding and no borrowings on our revolving credit facility.

Cintas' debt agreements contain certain covenants. These covenants limit our ability to incur certain liens and priority debt,liens, to engage in sale-leaseback transactions and to merge, consolidate or sell all or substantially all of Cintas' assets. These covenants also require Cintas to maintain a certain debt to consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) and interest coverage ratios.ratio. Cross-default provisions exist between certain debt instruments. If a default of a significant covenant were to occur, the default could result in an acceleration of the maturity of the indebtedness, impair liquidity and limit the ability to raise future capital. Cintas was in compliance with all of the debt covenants for all periods presented.

Cintas Corporation No. 2 (Corp. 2) is the indirectly, wholly owned principal operating subsidiary of Cintas. Corp. 2 is the issuer of the $2,436.6 million aggregate principal amount of senior notes outstanding as of May 31, 2025,2026, which are unconditionally guaranteed, jointly and severally, by Cintas Corporation and its wholly owned, direct and indirect domestic subsidiaries. See Note 6 entitled Debt, Derivatives and Hedging Activities of "Notes to Consolidated Financial Statements" for more information on Cintas' outstanding debt.

Cintas is subject to legal proceedings, insurance receipts, legal settlements and claims arising from the ordinary course of its business, including personal injury, customer contract, environmental and employment claims. InWhile the opinionresults of management,any such legal proceedings cannot be predicted with certainty, management believes, the aggregate liability, if any, with respect to such ordinary course of business actions will not have a material adverse effect on the consolidated financial position, consolidated results of operations or consolidated cash flows of Cintas. Cintas is also party to additional litigation not considered in the ordinary course of business. See Note 15 entitled Litigation and Other Contingencies of "Notes to Consolidated Financial Statements" for a detailed discussion of such additional litigation.

In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures (ASU 2023-09), which expands disclosures in an entity’s income tax rate reconciliation table and regarding cash taxes paid both in the U.S. and foreign jurisdictions. ASU 2023-09 will be effective for annual periods beginning after December 15, 2024 (fiscal 2026). The Company is currently evaluatingadopted the impact of ASU 2023-09standard on a prospective basis, for the consolidatedfiscal financialyear statements.ended May 31, 2026, see additional disclosures in the "Notes to Consolidated Financial Statements."

Revenue recognition. ApproximatelyOver 95% of the Company's revenue is derived from fees for route servicing of Uniform Rental and Facility Services, First Aid and Safety Services and Fire Protection Services customers, performed by a Cintas employee-partner, at the customer's location of business. Revenue from our route servicing customer contracts represent a single-performance obligation. The Company recognizes revenue over time as services are performed, based on the nature of services provided and contractual rates (output method) or at a point in time when the performance obligation under the terms of the contract with a customer are satisfied, at the customer's location of business. The Company's remaining revenue, primarily within the Uniform Direct Sales operating segment, and representing approximately 5% of the Company's total revenue, is recognized when the obligations under the terms of a contract with a customer are satisfied. This generally occurs when the goods are transferred to the customer.

Revenue recorded is presented net of sales and other taxes we collect on behalf of governmental authorities. Shipping and handling costs charged to customers are treated as fulfillment activities and are recorded in both revenue and cost of sales at the time control is transferred to the customer. Certain of our customer contracts include pricing terms and conditions that include components of variable consideration. The variable consideration is typically in the form of consideration paid to a customer based on performance metrics specified within the contract and is not material in any period presented. When determining if variable consideration should be constrained, the Company considers whether factors outside its control could result in a significant reversal of revenue. In making these assessments, the Company considers the likelihood and magnitude of a potential reversal. The Company's performance period generally corresponds with the monthly invoice period. No constraints on our revenue recognition were applied during the fiscal years ended May 31, 2025, 2024 or 2023. See Note 2 entitled Revenue Recognition of "Notes to Consolidated Financial Statements".

Uniforms and other rental items in service. Uniforms and other rental items in service are valued at cost less amortization, calculated using the straight-line method. Uniforms in service (other than cleanroom garments) are amortized over their useful lives, which range from 18 to 30 months. Other rental items, including shop towels, mats, mops, cleanroom garments, linens and restroom dispensers, are amortized over their useful lives, which range from 8 to 60 months. The amortization rates used are based on industry experience,experience and Cintas' specific experience and wear tests performed by Cintas.experience. These factors are critical to determining the amount of in servicein-service inventory and related cost of uniforms and facility services that are presented in the consolidated financial statements.

Insurance reserve. The insurance reserve represents the estimated ultimate cost of all asserted and unasserted claims (incurred but not reported), primarily related to workers' compensation, auto liability and other general liability exposure through the consolidated balance sheet dates. Our incurred but not reported reserves are estimated through actuarial procedures, with the assistance of third-party actuarial specialists, of the insurance industry and by using industry assumptions, adjusted for specific expectations based on our claims history. Cintas records an increase or decrease in selling and administrative expenses related to development of prior claims, higherrecent claims activity and other industry factors in the period in which it becomes known. These changes in estimates may be material to the consolidated financial statements.

Cintas classifies its business into two reportable operating segments and places the remainder of its operating segments in an All Other category. Cintas’ two reportable operating segments are Uniform Rental and Facility Services and First Aid and Safety Services. The Uniform Rental and Facility Services reportable operating segment consists of the rental and servicing of uniforms and other garments including flame resistant clothing, mats, mops and shop towels and other ancillary items. In addition to these rental items, restroom cleaning services and supplies and the sale of items from our catalogs to our customers on route are included within this reportable operating segment. The First Aid and Safety Services reportable operating segment consists of first aid and safety products and services, as well as workplace water services. The remainder of Cintas’ business, which consists of the Fire Protection Services operating segment and the Uniform Direct Sales operating segment, is included in All Other. These operating segments consist of fire protection products and services and the direct sale of uniforms and related items. Cintas evaluates operating segment performance based on revenue and operating income. Revenue and operating income for the three and nine months ended FebruaryAugust 28,31, 2026 and 2025, for the two reportable operating segments and All Other are presented in Note 1110 entitled Segment Information of “Notes to Consolidated Condensed Financial Statements.” The Company regularly reviews its operating segments for reporting purposes based on the information its chief operating decision maker (CODM) regularly reviews for purposes of allocating resources and assessing performance and makes changes when appropriate.

Three Months Ended FebruaryAugust 28,31, 2026 Compared to Three Months Ended FebruaryAugust 28,31, 2025

Total revenue increased 8.9%10.9% to $2,841.4$3,014.0 million for the three months ended FebruaryAugust 28,31, 2026, compared to $2,609.2$2,718.1 million for the three months ended FebruaryAugust 28,31, 2025. The organic revenue growth rate, which adjusts for the impact of acquisitionsacquisitions, workday differences and foreign currency exchange rate fluctuations, was 8.2%.8.9%. Revenue growth was positively impacted by 0.4% due to acquisitionsacquisitions, positively impacted by 1.7% due to one more workday in the three months ended August 31, 2026 compared to the three months ended August 31, 2025, and 0.3%negatively impacted by 0.1% due to foreign currency exchange rate fluctuations.

Uniform Rental and Facility Services reportable operating segment revenue was $2,177.5$2,294.7 million for the three months ended FebruaryAugust 28,31, 2026, compared to $2,021.1$2,091.1 million for the three months ended FebruaryAugust 28,31, 2025, which was an increase of 7.7%.9.7%. The organic revenue growth rate for this reportable operating segment was 7.3%.8.0%. Revenue growth in the Uniform Rental and Facility Services reportable operating segment was positively impacted by 0.1%0.2% due to acquisitionsacquisitions, positively impacted by 1.7% due to one more workday in the three months ended August 31, 2026 compared to the three months ended August 31, 2025, and 0.3%negatively impacted by 0.2% due to foreign currency exchange rate fluctuations. Revenue growth was a result of new business, the penetration of additional products and services into existing customers, price increases, and strong customer retention.

Other revenue, consisting of revenue from the First Aid and Safety Services reportable operating segment and All Other, increased 12.9%14.7% for the three months ended FebruaryAugust 28,31, 2026, compared to the three months ended FebruaryAugust 28,31, 2025, from $588.0$627.1 million to $664.0$719.2 million. The organic revenue growth rate for other revenue was 11.4%.11.9%. Revenue growth was positively impacted by 1.4%1.1% due to acquisitions and 0.1%positively impacted by 1.7% due to foreignone currencymore exchangeworkday ratein fluctuations.the three months ended August 31, 2026 compared to the three months ended August 31, 2025.

Cost of uniform rental and facility services consists primarily of production expenses, delivery expenses and the amortization of in-service inventory, including uniforms, mats, shop towels and other ancillary items. Cost of uniform rental and facility services increased $73.4$76.3 million, or 7.3%, for the three months ended FebruaryAugust 28,31, 2026, compared to the three months ended FebruaryAugust 28,31, 2025. Cost of uniform rental and facility services improved as a percent of revenue, decreasing from 50.0%50.3% for the three months ended FebruaryAugust 28,31, 2025, to 49.7%49.2% for the three months ended FebruaryAugust 28,31, 2026. This improvement as a percent of revenue was primarily due to more efficient usage of in-service inventory, strategic sourcing initiatives, efficiency gains and improved leverage of fixed costs.

Cost of other consists primarily of cost of goods sold (predominantly first aid and safety products, personal protective equipment, uniforms and fire protection products), delivery expenses and distribution expenses in the First Aid and Safety Services reportable operating segment and All Other. Cost of other increased $29.8$32.5 million, or 10.6%,10.9%, for the three months ended FebruaryAugust 28,31, 2026, compared to the three months ended FebruaryAugust 28,31, 2025. Cost of other improved as a percent of revenue, decreasing from 47.6%47.7% for three months ended FebruaryAugust 28,31, 2025, to 46.7%46.1% for the three months ended FebruaryAugust 28,31, 2026. The improvement in cost of sales as a percent of revenue was primarily due to favorable sales mix and sourcing and productivity initiatives.initiatives and a favorable sales mix.

Selling and administrative expenses increased $79.1$78.5 million, or 11.1%,10.5%, in the three months ended FebruaryAugust 28,31, 2026, compared to the three months ended FebruaryAugust 28,31, 2025. Selling and administrative expenses as a percent of revenue were 27.8%27.4% for the three months ended FebruaryAugust 28,31, 2026, compared to 27.2%27.5% for the three months ended FebruaryAugust 28,31, 2025. We recorded a gain of $15.0 million on a sale of property and equipment in the three months ended February 28, 2025 which impacted all segments by the same percent of revenue. Excluding this gain, selling and administrative expenses as a percent of revenue remained the same for the three months ended February 28, 2026, compared to the three months ended February 28, 2025.

Operating income was $659.9$711.9 million, or 23.2%23.6% of revenue, for the three months ended FebruaryAugust 28,31, 2026, compared to $609.9$617.9 million, or 23.4%22.7% of revenue, for the three months ended FebruaryAugust 28,31, 2025. Excluding the gain on a sale of property and equipment in the three months ended February 28, 2025 noted previously, operating income as a percent of revenue improved by 0.4%. The resulting increase in operating income as a percent of revenue was primarily due to more efficient usage of in-service inventory, strategic sourcing initiatives, efficiency gains and improved leverage of fixed costs.

Net interest expense (interest expense less interest income) was $27.4$22.1 million for the three months ended FebruaryAugust 28,31, 2026, compared to $23.4$22.0 million for the three months ended FebruaryAugust 28,31, 2025. The change was primarily due to an increase in the average amount of outstanding commercial paper during the three months ended February 28, 2026.

Cintas’ effective tax rate was 20.6%20.0% and 21.0%17.6% for the three months ended FebruaryAugust 28,31, 2026 and 2025, respectively. The effective tax rate in both periods was impacted by certain discrete items, primarily the tax accounting impact for stock-based compensation.

Net income was $502.5$551.7 million for the three months ended FebruaryAugust 28,31, 2026, an increase of 8.4%12.3% compared to the three months ended FebruaryAugust 28,31, 2025. Diluted earnings per share were $1.24$1.36 for the three months ended FebruaryAugust 28,31, 2026, which was an increase of 9.7%13.3% compared to the three months ended FebruaryAugust 28,31, 2025. Diluted earnings per share increased primarily due to the increase in net income and share repurchases.income.

Three Months Ended FebruaryAugust 28,31, 2026 Compared to Three Months Ended FebruaryAugust 28,31, 2025

Uniform Rental and Facility Services reportable operating segment revenue increased to $2,177.5$2,294.7 million from $2,021.1$2,091.1 million, or 7.7%,9.7%, for the three months ended FebruaryAugust 28,31, 2026, over the three months ended FebruaryAugust 28,31, 2025. The organic revenue growth rate for the reportable operating segment was 7.3%.8.0%. The cost of uniform rental and facility services increased $73.4$76.3 million, or 7.3%. The reportable operating segment’s gross margin was $1,094.4$1,165.9 million. Gross margin as a percent of revenue was 50.3%50.8% for the three months ended FebruaryAugust 28,31, 2026, compared to 50.0%49.7% for the three months ended FebruaryAugust 28,31, 2025. The resulting increase as a percent of revenue was primarily due to more efficient usage of in-service inventory, strategic sourcing initiatives, efficiency gains and improved leverage of fixed costs.

Selling and administrative expenses for the Uniform Rental and Facility Services reportable operating segment increased $51.4$52.2 million in the three months ended FebruaryAugust 28,31, 2026, compared to the three months ended FebruaryAugust 28,31, 2025. Selling and administrative expenses as a percent of revenue for the three months ended FebruaryAugust 28,31, 2026 were 26.3%,25.7%, compared to 25.8% in the three months ended FebruaryAugust 28,31, 2025. Excluding the gain on a sale of property and equipment in the three months ended February 28, 2025, selling and administrative expenses as a percent of revenue remained the same in the three months ended February 28, 2026, compared to the three months ended February 28, 2025.

Operating Incomeincome increased $31.5$75.2 million, or 6.4%,15.0%, for the Uniform Rental and Facility Services reportable operating segment for the three months ended FebruaryAugust 28,31, 2026, compared to the three months ended FebruaryAugust 28,31, 2025. Operating income was 23.9%25.1% of the reportable operating segment's revenue compared to the three months ended FebruaryAugust 28,31, 2025 of 24.2%23.9% of revenue. Excluding the gain on a sale of property and equipment in the three months ended February 28, 2025 noted previously, operating income as a percent of revenue improved by 0.3%. The improvement in operating income was primarily a result of the expansion in gross margin.

Three Months Ended FebruaryAugust 28,31, 2026 Compared to Three Months Ended FebruaryAugust 28,31, 2025

First Aid and Safety Services reportable operating segment revenue increased to $346.8$388.5 million from $301.8$334.7 million, or 14.9%,16.1%, for the three months ended FebruaryAugust 28,31, 2026, over the three months ended FebruaryAugust 28,31, 2025. The organic revenue growth rate for the reportable operating segment was 14.6%.14.2%. First Aid and Safety Services reportable operating segment revenue was positively impacted by 0.2% due to acquisitions.acquisitions and by 1.7% due to one more workday in the three months ended August 31, 2026 compared to the three months ended August 31, 2025. The increase in revenue was driven by many factors including increases in new business sold by sales representatives, penetration of additional products and services into existing customers, price increases and strong customer retention.

Cost of first aid and safety services for the three months ended FebruaryAugust 28,31, 2026, increased $15.6$20.2 million, or 12.0%,14.0%, compared to the three months ended FebruaryAugust 28,31, 2025. The gross margin as a percent of revenue was 58.1%57.6% for the three months ended FebruaryAugust 28,31, 2026, compared to 57.0%56.8% in the three months ended FebruaryAugust 28,31, 2025. The improvement in gross margin as a percent of revenue was primarily due to a favorable sales mixmix, efficiency gains and strategic sourcing initiatives.

Selling and administrative expenses increased $13.7$14.4 million in the three months ended FebruaryAugust 28,31, 2026, compared to the three months ended FebruaryAugust 28,31, 2025. Selling and administrative expenses as a percent of revenue for the three months ended FebruaryAugust 28,31, 2026 were 33.0%,32.0%, compared to 33.3%32.8% for the three months ended FebruaryAugust 28, 2025. Excluding the gain on a sale of property and equipment in the three months ended February 28, 2025, selling and administrative expenses as a percent of revenue improved by 0.9% in the three months ended February 28, 2026, compared to the three months ended February 28,31, 2025. The improvement as a percent of revenue was primarily due to operating leverage from revenue growth.

Operating Incomeincome for the First Aid and Safety Services reportable operating segment increased $15.8$19.2 million to $87.3$99.5 million for the three months ended FebruaryAugust 28,31, 2026, compared to the three months ended FebruaryAugust 28,31, 2025. Operating income was 25.2%25.6% of the reportable operating segment’s revenue compared to the three months ended FebruaryAugust 28,31, 2025 of 23.7%.24.0%. The improvement in operating income as a percent toof revenue was primarily due to the previously discussed changes in gross margin and selling and administrative expenses noted above.

The following is a summary of our cash flows and cash and cash equivalents as of and for the ninethree months ended FebruaryAugust 2831:

Cash and cash equivalents as of FebruaryAugust 28,31, 2026 and 2025, include $97.6$79.8 million and $34.2$66.7 million, respectively, that is located outside of the U.S.

Cash flows provided by operating activities have historically supplied us with a significant source of liquidity. We generally use these cash flows to fund most, if not all, of our operations and expansion activities and dividends on our common stock. We may also use cash flows provided by operating activities, as well as proceeds from long-term debt and short-term borrowingsborrowings, to fund growth and expansion opportunities, as well as other cash requirements such as the repurchase of our common stock and payment of long-term debt.

Net cash provided by operating activities was $1,567.2$572.3 million for the ninethree months ended FebruaryAugust 28,31, 2026, compared to $1,525.6$414.5 million for the ninethree months ended FebruaryAugust 28,31, 2025. The change from the prior fiscal year was primarily due to an increase in net income,income and favorable changes in working capital, specifically, accounts receivable,payable, netaccrued liabilities and income taxes. These changes were partially offset by unfavorable changes in working capital, specifically accruedprepaid liabilitiesexpenses and other current assets and accounts payable.receivable, net.

Net cash used in investing activities includes capital expenditures, purchases of investments and cash paid for acquisitions of businesses. Capital expenditures were $299.1$107.5 million and $294.3$102.0 million for the ninethree months ended FebruaryAugust 28,31, 2026 and 2025, respectively. Capital expenditures in the ninethree months ended FebruaryAugust 28,31, 2026, included $206.5$88.8 million for the Uniform Rental and Facility Services reportable operating segment and $48.7$11.8 million for the First Aid and Safety Services reportable operating segment. Cash paid for acquisitions of businesses was $102.7$3.9 million and $198.8$7.6 million for the ninethree months ended FebruaryAugust 28,31, 2026 and 2025, respectively. The acquisitions during both the ninethree months ended FebruaryAugust 28,31, 2026 andoccurred in our Fire Protection Services operating segment, which is included in All Other. During the three months ended August 31, 2025, acquisitions occurred in our Uniform Rental and Facility Services reportable operating segment, our First Aid and Safety Services reportable operating segment and our Fire Protection Services operating segment, which is included in All Other. In addition, during the nine months ended February 28, 2025, Cintas received cash proceeds of $24.0 million related to the sale of property and equipment. Net cash used in investing activities also includes $8.3$7.2 million and $7.1$6.5 million of purchases of investments during the ninethree months ended FebruaryAugust 28,31, 2026 and 2025, respectively.

Net cash used in financing activities was $1,239.0$500.2 million and $1,146.0$424.0 million for the ninethree months ended FebruaryAugust 28,31, 2026 and 2025, respectively. The increase in cash used in financing activities was due to an increase in repurchases of common stock and an increase in dividends paid. This increase in cash used in financing activity was partially offset by an increase in the net issuance of commercial paper in the nine months ended February 28, 2026.

On July 26, 2022, July 23, 2024 and October 28, 2025, Cintas announced that the Board of Directors (the Board) authorized share buyback programs, each for $1.0 billion. The July 26, 2022 share buyback planprogram was completed during the second quarter of fiscal 2026. Neither of the outstanding share buyback programs have an expiration date. The following table summarizes the share buyback activity by program for the three months ended August 31:

ThereIn werethe noperiod subsequent to August 31, 2026, through October 7, 2026, Cintas purchased 2.5 million shares of Cintas common stock at an average price of $198.99 per share, for a total purchase price of $494.0 million. The July 23, 2024 share buybacksbuyback program was completed in the period subsequent to FebruaryAugust 28, 2026, through April 7,31, 2026. From the inception of the July 23, 2024 share buyback program through April 7,September 2026, Cintas has purchased 2.75.1 million shares of Cintas common stock in the aggregate, at an average price of $189.32$195.19 per share, for a total purchase price of $508.9$1.0 million.billion. Cintas has made no purchases underUnder the October 28, 2025 share buyback program.program, Cintas has purchased 1.2 million shares of Cintas common stock at an average price of $198.90 per share, for a total purchase price of $244.1 million in the period subsequent to August 31, 2026, through October 7, 2026.

(1)The dividends declared during the three months ended FebruaryAugust 28,31, 2026 and 2025 were included in current accrued liabilities on the consolidated condensed balance sheet at FebruaryAugust 28,31, 2026 and 2025.

Cintas Corporation No. 2 (Corp. 2) entered into aThe credit agreement which supports our commercial paper program on March 27, 2026 (the Credit Agreement). The Credit Agreement has capacity under thea revolving credit facility of $2.0 billion and contains a letter of credit sub-facility of up to $300.0 million and a swing line sub-facility of up to $150.0 million. The Creditcredit Agreementagreement has an accordion feature that provides Cintas with the ability to request increases to the borrowing commitments under the revolving credit facility up to $1.0 billion in the aggregate, subject to customary conditions. The maturity date of the revolving credit facility is March 27, 2031. In connection with the entry into the Credit Agreement, on March 27, 2026, Corp. 2 terminated all commitments and repaid all obligations under its existing Third Amended and Restated Credit Agreement, dated as of March 23, 2022 (as amended, restated, supplemented or otherwise modified from time to time prior to such date, the “Existing Credit Agreement”). Upon the termination of the Existing Credit Agreement, all of the obligations under the Existing Credit Agreement were terminated. As of FebruaryAugust 28,31, 2026 there was $229.5 million of commercial paper outstanding with a weighted average interest rate of 3.81% and no borrowings on our Existing Credit Agreement. As of May 31, 2025,2026, there was no commercial paper outstanding and no borrowings on our Existingrevolving Creditcredit Agreement.facility.