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

Adverse global macroeconomic conditions, including due to heightened geopolitical tensions, inflation, slowing growth or a recession, currency fluctuations, new or increased tariffs or barriers to trade, tighter credit, higher interest rates, union strikes, and higher unemployment rates can negatively impact customer confidence, spending, and demand for our products and services. In addition, these conditions can negatively impact our customers and suppliers. A downturn in the economic environment can also lead to increased credit and collectability risk or slower collection on the Company's trade receivables, increased bankruptcy risk amongst our suppliers, the failure of derivative counterparties or other financial institutions, limitations on the ability of the Company to issue new debt, reduced liquidity, declines in the fair value of the Company's financial instruments, and increased impairment risk for the Company's goodwill and intangible assets. We have experienced andand, in the futurefuture, may continue to experience volatility in revenues, operating results and profitability primarily as a result of these uncertain global macroeconomic conditions.

Our business relies on third-party suppliers for raw materials, components and contract manufacturing services to produce our products. Commodity prices and the prices for other raw materials necessary for production have fluctuated, and may continue to fluctuate, andwhich inrepresent 2024a increasespotential inrisk raw material costs negatively impactedfor our financial results. We are not always able to pass along raw material and component price increases to our customers which has impacted, and may continue to impact, our sales growth and profitability.

In addition, the supply of raw materials to ITT and to its component parts suppliers has been, and may continue to be, interrupted for a variety of reasons affecting our suppliers, including congested shipping ports around the world, production interruptions, heightened geopolitical tensions, including related to the Russia-Ukraine and the Middle East conflicts, global pandemics, the impaired financial condition of a particular supplier, capacity constraints, labor disputes or shortages, the ability to meet regulatory requirements and commitments to other purchasers. For most of our products, we have existing alternate sources of supply, or the required materials have historically been readily available. In limited instances, we depend on a single source of supply, manufacturing or assembly, or participate in commodity markets that may be subject to a limited number of suppliers. Although we believe we could obtain and qualify alternative sources for most sole and limited source supplier materials if necessary, the transition to an alternative source could be complex, costly, and protracted, especially if the change requires us to redesign our systems or re-qualify our products. InAny 2024,further delay in our suppliers’ abilities to provide us with sufficient quality or flow of materials or any supplier price increases, or any decreased availability of raw materials andor componentcommodities, partscould adverselyfurther affectedimpair our ability to deliver products to our customers and resultedmay inimpact increasedour backlog.profitability.

We regularly review our portfolio of businesses and pursue growth through the acquisition of other companies, assets and product lines that either complement or expand our existing businesses. For example, on December 4, 2025, we entered into the Purchase Agreement for the acquisition of SPX FLOW, which remains subject to the satisfaction or waiver of customary closing conditions, including regulatory approvals. Refer to Note 22, Acquisitions, Investments, and Divestitures, for further information regarding acquisitions and investments made during the year and the pending acquisition of SPX FLOW. In addition, from time to time, we make minority investments in other early-stage companies, and we risk losing part or all of our capital in any such investment. Refer to Note 21, Acquisitions, Investments, and Divestitures, for further information regarding acquisitions and investments made during the year. Although we conduct what we believe to be a prudent level of investigation regarding the operating and financial condition of the businesses we acquire, a level of risk remains regarding the actual operating condition of these businesses. Until we actually assume operating control of these businesses and their operations, we may not be able to ascertain the actual value or understand the potential liabilities of, or challenges facing, the acquired businesses and their operations. AcquisitionsAcquisitions, including the pending acquisition of SPX FLOW, involve a number of risks and present financial, managerial and operational challenges that could have a material adverse effect on our reputation, financial results and business. These include the possibility that:

Obtaining, maintaining and enforcing our proprietary rights is another factor that is critical to the success of our business and our ability to remain competitive. For certain products and manufacturing processes, we rely on patents, trademarks, trade secrets, non-disclosure agreements and other contracts to protect these rights. These contracts may be breached,breached or may not prevent competitors from independently developing or selling similar products. In addition, during the normal course of business, we could unintentionally infringe or violate the proprietary rights of others. Intellectual property litigation could be time consuming for management and could result in significant legal expenses to either pursue claims against others, or to defend ourselves. If we are unable to protect our patents, trademarks, or other proprietary rights, or if we infringe or violate the rights of others, our ability to remain competitive could be adversely impacted.

Our information technology systems and those of our third-party service providers may be susceptible to damage, disruptions or shutdowns due to power outages, hardware failures, telecommunication failures, cybersecurity incidents and user errors that may affect our operations. Although we actively manage the risks to our information technology systems that are within our control, we can provide no assurance that our actions or those of our third-party service providers will always be successful in eliminating or mitigating risks to our systems, networks or data. Even the most well-protected information technology systems could be vulnerable to internal and external cybersecurity incidents including, but not limited to, those by employees and by computer hackers and other threat actors utilizing techniques such as phishing, ransomware or denial of service attacks. We have experienced cybersecurity incidents in the past which have not had a material impact on our operations or financial results. If we experience a future disruption in our information technology systems, it could result in the loss of sales and customers and significant incremental costs, which could materially adversely affect our business. In addition, as a provider of products and services to government and commercial customers, and particularly as a government contractor, we are subject to a heightened risk of cybersecurity incidents caused by computer viruses, illegal break-ins or hacking, sabotage, or acts of vandalism, including by foreign governments, hackers and cyber terrorists. Furthermore, information technology security threats are increasing in sophistication, intensity and frequency. A cybersecurity incident may occur, including breaches that we may be unable to detect in a timely manner. The unavailability of our information technology systems, the failure of these systems to perform as anticipated for any reason, or any significant breach of security could cause significant disruption to our business or could result in decreased performance and increased costs.

We continue to monitor data security regulations in the jurisdictions in which we operate. The processing and storage of certain information is increasingly subject to privacy and data security regulations, and many such regulations are country-specific.country specific. The interpretation and application of data protection laws in the U.S., Europe, China, and elsewhere are uncertain, evolving and may be inconsistent across jurisdictions. Compliance with these various laws may be onerous and require us to incur substantial costs or to change our business practices in a manner that adversely affects our business, while failure to comply with such laws may subject us to substantial penalties.

Sales to Continental,Aumovio SE, a supplier to the automotive industry and ITT's largest customer, were approximately 7%6% of our total revenue in 2024.2025. Requests by automakers to use ITT brake pads in their Continental-producedAumovio produced braking systems (calipers) typically account for approximately half of MT's revenue from Continental.Aumovio. These automaker requests are generally formalized through supply agreements signed directly between MT and the automakers. The remainder of MT's sales to ContinentalAumovio in 20242025 was generated from a 10-year agreement to supply ContinentalAumovio with aftermarket parts, which is effective through December 31, 2033, although there can be no assurance that we are able to retain this customer's business in the future. The loss of this customer, or a reduction in this customer's market share could have a material adverse effect on our business, results of operations or financial condition.

Our international operations, including U.S. exports, comprise a growing portion of our operations and are a strategic focus for continued future growth. OurWe have sales in emerging markets such as Mexico, South America, China, and the Middle East have been increasing.East. In both 2024 and 2023,2025, approximately 67%65% of our total sales were to customers operating outside of the United States. Our sales from international operations and export sales are subject to varying degrees of risks inherent in doing business outside of the United States. These risks include the following:

Over the last sevenseveral years the U.S. government has undertaken a series of actions to increase tariffs on certain goods imported into the U.S., particularly from China and other key trading partners. In early 2025, the U.S. Theregovernment isannounced or extended tariffs on a possibilityrange theof currentimported presidentialgoods, administrationincluding maycertain alsoindustrial imposecomponents newand raw materials, as part of ongoing trade actions. In response, several countries, including China, announced or increased U.S. import tariffs, initially focusing on goods from Mexico, Canada, and China, with the potential for additional countries to be affected. In response to prior tariffs, certain governments imposedimplemented retaliatory tariffs on variousgoods goods,exported from the United States. These reciprocal trade measures have contributed to increased uncertainty in global trade policy and insupply responsechain to new or increased U.S. tariffs, have threatened to similarly retaliate.dynamics. Prior tariffs have negatively impacted demand for our products as well as the cost of certain parts and materials that we purchase from vendors located overseas, particularly in China. Although we have been mitigating, and will continue attempting to mitigate, the impact of tariffs by supplier and customer negotiations, diversification strategies and pricing actions, there can be no assurance that our mitigation actions will be effective. At this time, it remains unclear what further measures will be implementedimplemented, including changes to existing trade agreements or ifthe imposition of additional countries will impose retaliatory tariffs. Any new or continued trade disputes or increased tensions between the U.S. and other countries, and any governmental actions, including further increases of existing tariffs or the imposition of new tariffs, or changes to trade agreements applicable to our operations, may continue to adversely impact demand for our products, increase our costs, and disrupt our supply chain. These risks, in turn, could have a material adverse effect on our business results of operations and financial condition.

Our customer'scustomers' businesses, particularly those in the energy, chemical and mining industries, which represented approximately 11%,16%, 8%,9%, and 3%, respectively, of our 20242025 revenue, are to varying degrees cyclical and have experienced, and may in the future experience, periodic downturns of varying severity. For example, the volatility of the energy market has generally been dependent upon the prevailing view of future gas and oil prices, which are influenced by numerous supply and demand factors, including availability and cost of capital, global and domestic economic conditions, environmental regulations, policies of the Organization of the Petroleum Exporting Countries (OPEC) countries and Russia and other factors. Our customers in these industries, particularly those whose demand for our products and services is primarily profit-driven, have tended to delay large capital projects, including expensive maintenance and upgrades, during economic downturns. Additionally, fluctuating energy demand forecasts and commodity pricing and other macroeconomic factors may cause our customers to be more conservative in their capital planning, which could reduce demand for our products and services, result in the delay or cancellation of existing orders, or lead to excess manufacturing capacity, which unfavorably impacts our absorption of fixed manufacturing costs. This reduced demand may also erode average selling prices in our industry. These factors could have a material adverse effect on our business, results of operations and financial condition.

There is an increasing focus from certain investors, customers and other key stakeholders on corporate responsibility, specifically related to environmental, social, and governance ("ESG") matters, including companies' contribution to climate change and loss of biodiversity. Some investors have used, and may continue to use, ESG criteria to guide their investment strategies and, in some cases, have chosen, and may continue to choose, not to invest in ITT, or to divest their holdings of ITT if they believe our policies relating to corporate responsibility are inadequate. New U.S. and European Union climate-related disclosure requirements may require additional systems, internal controls, and assurance processes that could increase compliance costs.

The ESG factors by which companies’ corporate responsibility practices are assessed have been evolving and may continue to evolve. Additionally, requirements on U.S. public companies and companies with European operations with regards to ESG compliance have been increasing and may continue to increase, including, but not limited to, the SEC's rule requiring extensive climate-related disclosures,to California's Climate Accountability Laws,Laws and the European Union's Corporate Sustainability Reporting Directive (CSRD), which will require third-party assurance disclosures. These evolving standards and regulations have caused us, and may continue causing us, to undertake costly initiatives to satisfy such new criteria. If we are unable to satisfy new corporate responsibility criteria, investors may conclude our policies are inadequate and choose not to invest in our securities or to divest all or a portion of their current holdings, which in either case may adversely affect the price of our securities.

In addition, as we identify ESGsustainability topics for voluntary disclosure and work to align with the recommendations of the Financial Stability Board’s Task Force on Climate-Related Financial Disclosures (TCFD) and Sustainability Accounting Standards Board (SASB) standards and our own assessment of priority of ESGsustainability issues, we have expanded and, in the future, may continue to expand our disclosures in these areas. Statements about our ESGsustainability initiatives and goals, and progress against those goals, 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. If our ESG-relatedsustainability-related data, processing and reporting are incomplete or inaccurate, if we fail to achieve progress on our metrics on a timely basis or at all, or if we fail to satisfy the expectations of investors and other key stakeholders, our reputation, business, and financial performance could be adversely affected.

We are closely monitoring the potential passage of new U.S. and foreign tax legislation, which could result in substantial changes to the current U.S. or foreign tax systems. In October 2021, the OrganizationOrganisation for Economic Cooperation and Development (OECD) and G20 Finance Ministers reached an agreement, known as Base Erosion and Profit Shifting (BEPS) Pillar Two, which is a multi-jurisdictional plan of action to address base erosion and profit shifting. On December 20, 2021, the OECD released the Model GloBE Rules for Pillar Two defining a 15% global minimum tax rate for large multinational corporations. Countries are implementing legislation with widespread adoption of the Model GloBE Rules for Pillar Two. We continue to evaluate the Model GloBE Rules for Pillar Two and related legislation, and their potential impacts. Continuing enactment of these regulations could increase the amount of global corporate income tax paid by the Company. These increases could have a material adverse effect on our effective tax rate. As the effects of a change in U.S. or foreign tax law must be recognized in the period in which the new legislation is enacted, should new legislation be signed into law, our financial results could be materially impacted.

On August 16, 2022, the U.S. government enacted the Inflation Reduction Act of 2022 (the Inflation Reduction Act) into law. The Inflation Reduction Act includes a new corporate alternative minimum tax (the Corporate AMT) of 15% on the adjusted financial statement income (the "AFSI") of corporations with an average AFSI exceeding $1.0 billion over a three-year period. The Corporate AMT was effective for the Company beginning in 2023. Given the AFSI threshold, the Corporate AMT was not applicable to the Company in 2024,2025, but the Corporate AMT may have potential impacts on our future U.S. tax expense, cash taxes and effective tax rate. Additionally, the Inflation Reduction Act imposes a 1% excise tax on the fair market value of net stock repurchases made after December 31, 2022. Although the impact of this provision was not material in 2024prior years, we incurred $5.0 of excise tax on stock repurchases in 2025, and future impacts will be dependentdepend on the extent of share repurchases made in futuresubsequent periods, there can be no assurance that our business operations and financial condition will not be materially impacted by this provision in the future.periods.

We are subject to a variety of federal, state, local and foreign laws, rules and regulations related to the use, storage, handling, discharge or disposal of certain toxic, volatile or otherwise hazardous chemicals, gases and other substanceschemicals used in manufacturing our products, as well as laws related to greenhouse gas emissions (including cap-and-trade laws). These laws could require us to incur substantial expenses. Environmental laws and regulations allow for the assessment of substantial fines and criminal sanctions as well as facility shutdowns to address violations and may require the installation of costly pollution control equipment or operational changes to limit emissions or discharges. The discovery of previously unknown or more extensive contamination at a site which the Company previously operated or currently operates could suddenly subject the Company to costly remediation efforts. We could be affected directly or indirectly through impacts on our customers and suppliers by changes in environmental laws or regulations, including, for example, those imposed in response to vapor intrusion or climate change concerns and violations by us of such laws and regulations. We may also be impacted by the adequacy of insurance policies, our inability to recover costs associated with any such developments, or financial insolvency of other potentially responsible parties which could have a material adverse effect on our business, financial condition and results of operations. In addition, new laws and regulations that might reduce demand for oil and gas production or power generation may result in lower spending by some of our IP customers.

•We increased our capitalCapital expenditures byover 15%$120 compared tofor the previoussecond year in a row, reflecting our continued commitment to innovationfund andfuture growth,growth through capacity expansion, productivity and green energy, including solar installations.innovation.

•WeExecuted repurchasedrepurchases 0.8of 3.8 shares of common stock on the open market for $104.8.$521.0.

•We paid $104.7$111.0 in dividendsdividend payments to our shareholders. Our dividends declared in 20242025 of $1.28$1.40 per share represented a 10% increase over the dividends per share declared of $1.16$1.28 in 2023.2024.

MT revenue for the year ended December 31, 20242025 decreased $10.0$19.6 primarily duedriven toby the lossprior year divestiture of $68.7the Wolverine business which generated $89.1 of revenue as a result of the divestiture of Wolverine in Julyduring 2024. OurThis Frictiondecline businesswas grewpartially 4%offset due to strong OEM and aftermarket demand. Additionally, our KONI and Axtone businesses grew 15% and 6% respectively, due toby strength in Friction original equipment reflecting our railmarket outperformance and growth across our KONI business. The current year period also benefited from favorable foreign currency translation of $9.7.$44.0. Excluding the impact from the divestiture and foreign currency translation and the divestiture,translation, organic revenue increased $68.4$25.5, or 4.9%.1.9%.

IP revenue for the year ended December 31, 20242025 increased $231.4$135.2, driven primarily driven by the acquisition of Svanehøj, which closedgrowth in Januarypump 2024projects, reflecting strength across markets and contributed $156.2 to total revenue growth. Our pump project revenue grew 19%, primarily within the energy and chemical markets, and the short cycle business grew 5% primarily within the energy and industrial markets.geographies. The current year period also included growth from acquisitions of $26.1 and benefited by $13.0 from favorable foreign currency translation.translation of $15.7. Excluding the impacts from the acquisitionacquisitions and foreign currency translation, organic revenue increased $88.2$93.4, or 7.8%.6.9%.

Gross profit for 2025 was $1,392.4, reflecting a gross margin of 35.4%. Gross profit for 2024 was $1,247.3,$1,249.4, reflecting a gross margin of 34.4%. Gross profit for 2023 was $1,107.3, reflecting a gross margin of 33.7%. The increases in gross profit and gross margin were primarily driven by higherbenefits revenue, includingfrom pricing actions,actions describedand abovevolume ingrowth, thenet sectionsavings titledfrom "Revenue",productivity and sourcing initiatives and favorable foreign currency translation, partially offset by increasesunfavorable insales material and labor costs, as discussed above in the section titled "Global Macroeconomic Conditions".mix.

SalesGeneral and marketingadministrative (G&A) expenses increased $31.7$71.3 for the year ended December 31, 2024,2025, primarily driven by thehigher additionsincentive-based ofcompensation, kSARIArestructuring expenses, acquisition-related expenses, and Svanehøj,unfavorable asforeign wellcurrency as higher personnel and other selling and marketing-related costs to support higher sales activity. The increase was partially offset by the divestiture of the Wolverine business.translation.

ResearchSales and development (R&D)marketing expenses increased $13.7$23.0 for the year ended December 31, 2024,2025, primarily driven by acquisitions, higher personnelpersonnel, costscommissions, and continuedother strategicselling investmentsand marketing-related costs to support innovationhigher andsales newactivity, productas development,well partiallyas offsetincreased byintangible theamortization divestiture of the Wolverine business.expenses.

Gain on sale of businesses includes $47.8 related to our July 2024 sale of the Wolverine business which was previously held within our MT segment. The 2023 loss on sale of businesses includes a $15.3 loss due to the divestiture of our Matrix business, partially offset by a gain on sale of a product line, both previously held within our CCT segment.

MT operating income for the year ended December 31, 20242025 increaseddecreased $83.8$38.7, primarilydriven dueby to athe $47.8 gain on sale of the Wolverine business.business Inrecognized addition,in operating income benefited from higher revenue and savings from productivity and sourcing initiatives2024, as well as lowerthe materialloss of income following the divestiture, and overheadunfavorable foreign currency, pricing and sales mix impacts, and higher restructuring costs. OperatingThe income growthdecrease was partially offset by higher labor costsproductivity and strategicsupply investments.chain savings and benefits from sales volume growth.

CCTIP operating income for the year ended December 31, 20242025 increased $38.6,$36.7, driven by benefits from pricing actions, higher revenue,sales asvolume, discussednet above,savings from supply chain, restructuring, and productivity savings.initiatives, Thislower acquisition-related expenses, and favorable foreign currency impacts. The increase was partially offset by aunfavorable priorsales year net loss on the sale of businesses of $8.1,mix and higher material, labor, overhead costs, and incentive-based compensation in the current year.costs.

Corporate & Other costs increased $7.3$23.7 for the year ended December 31, 2024,2025, primarily drivendue byto thehigher impactincentive-based ofcompensation acosts, priorM&A-related yearprofessional gainservice of $3.7 associated with a lease terminationcosts, and highercharitable legal expenses in the current year.contributions. The increase was partially offset by favorable foreign currency impacts and lower incentive-based compensation.impacts.

On August 16, 2022, the U.S. government enacted the Inflation Reduction Act of 2022 (the Inflation Reduction Act) into law. The Inflation Reduction Act includes a new corporate alternative minimum tax (the Corporate AMT) of 15% on the adjusted financial statement income (the "AFSI") of corporations with an average AFSI exceeding $1.0 billion over a three-year period. The Corporate AMT was effective for the Company beginning in 2023. Given the AFSI threshold, the Corporate AMT was not applicable to the Company in 2024,2025, but the Corporate AMT may have potential impacts on our future U.S. tax expense, cash taxes and effective tax rate. Additionally, the Inflation Reduction Act imposes a 1% excise tax on the fair market value of net stock repurchases made after December 31, 2022. The impactexcise oftax on stock repurchases has been appropriately recognized and disclosed in the accompanying consolidated financial statements in this provisionForm was not material in 2024 and future impacts will be dependent on the extent of share repurchases made in future periods.10-K.

As of December 31, 2024,2025, we have access to short- and long-term funding sources. These include access to the capital markets through a commercial paper program, as well as $700$1,100 of available borrowing capacity under our 20212025 Revolving Credit Agreement (defined below), which may potentially be expanded to $1,050$1,650 under the agreement. In addition, we have market access to secure longer-term funding, if needed. Our commercial paper program is supported by our 20212025 Revolving Credit Agreement and our policy is to maintain unused committed bank lines of credit in an amount greater than outstanding commercial paper balances. These sources of capital are described further below.below and within Note 15, Debt.

When available and economically feasible, we have accessed the commercial paper market through programs in place in the U.S. and Europe to supplement cash flows generated internally and to provide additional short-term funding. The following table presents our outstanding commercial paper borrowings.

In the year ended December 31, 2025, we borrowed under the European commercial paper program to partially refinance the Company’s U.S. commercial paper. The proceeds of the 2025 Term Loan Credit Agreement (defined below) were used to refresh the U.S. commercial paper capacity and for other general corporate purposes. All outstanding commercial paper for both periods had maturity terms of less than three months from the date of issuance. Our average daily outstanding commercial paper balance for the years ended 20242025 and 20232024 was $338.5$525.5 and $366.9,$338.5, respectively, and the maximum outstanding commercial paper during each of those respective years was $455.0$1,113.5 and $669.9.$455.0.

The ongoing conflict involvingin the UnitedMiddle States, Israel, and IranEast and related geopolitical instability may adversely affect our business.

InBeginning in February 2026, the United States and Israel conducted coordinated military strikes against Iran, which responded with missiledirect and indirect attacks across the region.Middle East. Since that time, the conflict has continued through periods of escalation and attempted de-escalation, and hostilities between the United States and Iran have recently resumed. Although we do not have material operations in the Middle East,region, the ongoing conflict, and any further escalation, including additional military actions, retaliatory measures, sanctions, disruptions to trade or transportation routes, cyberattacks, or other governmental or market responses, has resulted in, and could continue to result in, significant disruptions to global energy supplies and increases in energy prices. These developments may heighten inflationary pressures on our input costs and supply chain, adversely affect global supply chains, energy and commodity markets, currency exchange rates, financial markets, and overall macroeconomic conditions, and negatively impact customer demand in the markets in which we operate. While we expect the conflict to continue to affect our business, financial condition, and results of operations, the extent and duration of these impacts remain uncertain.

All comparisons included within Management’s Discussion and Analysis of Financial Condition and Results of Operations refer to the comparable three and six months ended MarchJune 29,28, 2025, unless stated otherwise.

Global macroeconomic conditions continue to evolve againstamid a backdrop ofongoing geopolitical uncertaintyuncertainty, trade policy developments, and shifting market demands.dynamics. While these dynamicsfactors have created areas of variability, the Company continuedhas to applymaintained disciplined execution and continued strategic investment across its businesses. For the remainder of 2026, we expect demand to remain firm,generally butresilient, withalthough variationthe betweenoutlook industrialremains endinfluenced markets. In addition, changes inby geopolitical developments, trade policy actions, and energy market risk,volatility. tariffsWe believe our diversified portfolio, global operating footprint, and tradefocus policies,on workforceoperational availabilityexcellence position us to respond effectively to changing market conditions and cost,support technologylong-term transformationvalue and cost inflation are factors that we are watching that may impact our performance going forward.creation.

Geopolitical and Energy Market Risk: Geopolitical developments, including heightenedongoing tensionsconflict and active conflictinstability in the Middle East, maycontinue impactto influence global supply chains, energytrade pricing trends,flows, and defense‑relatedenergy procurement.markets. In particular,During the developingsecond U.S. military conflict with Iran, along with the closurequarter of 2026, disruptions affecting the Strait of Hormuz,Hormuz hasand broader regional energy infrastructure contributed to increasedheightened volatility in globaloil, natural gas, and shipping markets, although diplomatic efforts and ceasefire discussions have supported a partial normalization of certain trade routes and energy marketsflows. andDespite higherthese oildevelopments, andenergy natural gas prices. These dynamics may influence customer investment decisions, project timing,prices, logistics costs, and overall market conditionssentiment acrossremain certainsensitive endto markets.further escalation or renewed disruptions. At the same time, our growing presence in critical flow technologies, energy‑related applications, and resilient aftermarket channels helps balance exposure to near‑term volatility. Additionally, select programs within CCT may benefit from sustained or increased investments in defense, security, and national infrastructure. Overall, our continued portfolio evolution and diversified end‑market exposure are intended to enhance durability and adaptability across macroeconomic and geopolitical cycles.

The following table provides a summary of key performance indicators for the firstsecond quarter of 2026 as compared to the firstsecond quarter of 2025. There were four additional working days in the quarter versus the prior year.

Our firstsecond quarter 2026 results are summarized below:

•Revenue of $1,211.9$1,473.1 increased by $298.9$500.7 including $151.4$359.6 from acquisition activitycontributions and $47.8$17.6 from favorable foreign currency translation. Organic revenue increased 10.9%,by $123.5, or $99.7,12.7%, drivenled by aerospace and defense in CCT, growth in pump projects and valves in FT, strengthand acrossincreased endaftermarket marketsdemand infor CCT, led by aerospaceFriction and defense,KONI and Friction original equipment market outperformancedefense in MT.

•Operating income of $141.2$180.3 decreasedincreased 6.4%,by $5.2, or $9.7,3.0%, primarily due to acquisition-relatedincremental costs of $67.5volume and pricing actions partially offset by an increased intangible amortization expense of $12.7$51.0 related to our acquisition of SPX FLOW. Adjusted operating income increased 41.7%,by $104.6, or $72.3,54.9%, driven by volume leverage, benefits from productivity actions, and a favorablefull foreignquarter currencyof impact,SPX partiallyFLOW offset by material cost inflation.results.

•Income from continuing operations was $0.89$0.95 per diluted share, a decrease of $0.44$0.57 as compared to the prior year, primarily due to acquisition-related costs and intangible amortization expenses.costs. Adjusted income from continuing operations was $1.98$2.08 per diluted share, an increase of 25.3%,$0.32, or $0.40,18.2% duecompared towith athe strongprior operationalyear performanceperiod. The increase was primarily driven by eachadjusted businessoperating segment,income includinggrowth accretionfrom all segments, partially offset by higher interest expense, effective tax rate and weighted-average share count resulting from the acquisition of SPX FLOW, partially offset by an increase in interest and tax expenses and a higher weighted average share count.FLOW.

FT revenue for the three and six months ended AprilJuly 4, 2026 increased $204.1,by including$436.6 $151.4and from$640.7, respectively, primarily due to acquisition activitycontributions of $359.6 and $12.1$511.0, from favorable foreign currency translation.respectively. Organic revenue increased 12.2%,by $73.8, or $40.6,20.7%, and $114.4, or 16.6%, for the three and six-month periods, respectively, primarily reflectingdriven by growth in projectpump pumpsprojects of 16%45% and 30%, respectively, reflecting strong demand in the energy market. Additionally, short-cycle demand remained strong with revenue growth of 10%,10% includingin aboth strongperiods, executiondriven from Svanehøj andby valves.

MT revenue for the three and six months ended AprilJuly 4, 2026 increased $51.1,$20.3 and $71.4, respectively, including $32.8 from favorable foreign currency translation.translation of $14.3 and $47.1, respectively. Organic revenue increased 5.3%,by $6.0, or $18.3,1.6%, and $24.3, or 3.4%, for the three and six month periods, respectively, primarily reflectingdriven by increased aftermarket sales of 6% and 4%, respectively. In addition, organic revenue for the six-month period included growth fromof Frictionapproximately original equipment and aftermarket, as well as strength6% from our KONI rail.rail business.

Gross profit for the three and six months ended AprilJuly 4, 2026 increased 32.7%45.4% to $428.8.$510.1 and 39.3% to $938.9, respectively. The increase in gross profit for both periods was primarily driven by the acquisition of SPX FLOW, volume leverage andleverage, benefits from pricing actions andactions, net savings from productivity and sourcing initiatives, and favorable foreign currency translations, partially offset by unfavorable sales mix and higher freightmaterial and labor costs.

Sales and marketing expenses increased 53.9%,by $36.1, or $25.8,70.2%, and $62.1, or 62.7%, respectively, for the three and six months ended July 4, 2026. The increase was primarily driven by the acquisition of SPX FLOW and higher personnel costs and commissionscommission expenses.

Research and development (R&D) expenses increased 30.8%,$8.6, or $7.8,31.6%, and $16.3, or 31.0%, respectively, for the three and six months ended July 4, 2026. The increase was primarily due to the acquisition of SPX FLOW and the timing of customer-funded R&D project activity.activity and reimbursements.

Intangible amortization increased 90.7%,$51.0, or $12.7439.7%, primarilyand $63.7, or 248.8%, for the three and six months ended July 4, 2026, respectively, due to the amortization of backlog and customer relationship intangible assets acquired in connection with the purchaseacquisition of SPX FLOW.

MT operating income for the three and six months ended July 4, 2026 increased 23.4%,$10.9, or $15.8,15.3%, and $26.8, or 19.3%, respectively, primarily due to higher sales volume, net savings from productivity and sourcing initiatives, and a favorable impact from foreign currency fluctuations, which was partially offset by competitive pricing dynamics.

CCT operating income for the three and six months ended July 4, 2026 increased 36.7%,$15.9, or $13.2,35.4%, and $29.2, or 36.1%, respectively, primarily driven by benefits from higher sales volume andvolume, pricing actions, partially offset by higher material costs and R&Dnet expenses.savings from productivity initiatives.

The effective tax rateETR for the three and six months ended AprilJuly 4, 2026 increased to 38.3%36.0% and 37.2%, respectively, primarily due to the recognition of additional tax expense related to undistributed foreign earnings,earnings and transaction-related costs incurred in connection with the acquisition of SPX FLOW,FLOW. and the impact of amended tax filings in Luxembourg. In addition, theThe acquisition also affected the geographic mix of earnings which further contributed to the higher effective tax rate for theboth period.periods.

In October 2021, more than 135 countries and jurisdictions agreed to participate in a “two-pillar” international tax approach developed by the OECD, which includes establishing a global minimum corporate tax rate of 15 percent. The OECD published Tax Challenges Arising from the Digitalisation of the Economy — Global Anti-Base Erosion Model Rules (Pillar Two) in December 2021 and subsequently issued additional commentary and administrative guidance clarifying several aspects of the model rules. Since the model rules have been released, many countries have enacted Pillar Two-related laws, many of which became effective January 1, 2024 with additional laws effective January 1, 2025. As of AprilJuly 4, 2026, the Company does not expect Pillar Two taxes to have a significant impact on its 2026 financial statements.

We manage our worldwide cash requirements considering available funds among the many subsidiaries through which we conduct business and the cost effectiveness with which those funds can be accessed. We support our growth and expansion in markets outside of the U.S. through the enhancement of existing products and development of new products, increased capital spending, and potential foreign acquisitions. We look for opportunities to access cash balances in excess of local operating requirements to meet our global liquidity needs in a cost-efficient manner. We transfer cash between certain international subsidiaries and the U.S. when it is cost effective to do so. During the threesix months ended AprilJuly 4, 2026, we had net cash distributions from foreign countries to the U.S. of $1.6.$402.5. During the year ended December 31, 2025, we had net cash distributions from foreign countries to the U.S. of $577.5. The timing and amount of any additional future distributions will be evaluated based on our jurisdictional cash needs.

The amount and timing of dividends payable on our common stock are within the sole discretion of our Board of Directors and will be based on, and affected by, several factors, including our financial position and results of operations, available cash, expected capital spending plans, prevailing business conditions, and other factors the Board of Directors deems relevant. Therefore, we cannot provide any assurance as to what level of dividends, if any, will be paid in the future. In the firstsecond quarter of 2026, we declared a dividend of $0.386 per share for shareholders of record on MarchJune 6,8, 2026, which was a 10% increase from the quarterly dividends of $0.351 that were declared in 2025. Dividend payments during the threesix months ended AprilJuly 4, 2026 amounted to $35.0.$69.5.

From time to time, the Company may repurchase shares of its stock on the open market. The timing of any repurchases and the actual number of shares repurchased depends on a variety of factors, including remaining authorization under existing Board-approved share repurchase program, the Company’s stock price, restrictions under the Company’s debt obligations, other uses for capital, the dilutive impact of shares issued during the period related to the Company’s long-term incentive plans, impacts on the value of remaining shares, and market and economic conditions. WeThe spentCompany repurchased approximately $100$100.0 onand open-market share repurchases$500.1 under our share repurchase program during both the threesix months ended AprilJuly 4, 2026 and MarchJune 29,28, 2025.2025, respectively. All repurchased shares arewere retired immediately following the repurchases. See Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds, for additional information.

During the threesix months ended AprilJuly 4, 2026, we borrowed under theU.S. U.S.and Euro commercial paper program to support the timing of overall liquidity requirementsprograms for general corporate purposes.purposes and lower interest rates. See Note 15, Debt, to the Consolidated Condensed Financial Statements for further information.

The loans drawn under the 2026 DDTL Credit Agreement (the DDTL Loans) will mature two years from the date of the first borrowing of the DDTL Loans. Total outstanding borrowings under the 2026 DDTL Credit Agreement were $2,875 as of April July 4, 2026.

The DDTL Loans will bear interest at rate per annum equal to, at the Company’s option, either (i) Term SOFR plus a margin ranging from 1.00% to 1.50%, or (ii) an alternate base rate plus a margin ranging from 0.0% to 0.50%, with the applicable margin determined by reference to the Company’s debt ratings as set forth in the 2026 DDTL Credit Agreement. The DDTL Loans may be prepaid by the Company at any time, in whole or in part, without penalty or premium, subject to certain customary conditions.

On April 30, 2025, the Company entered into a credit agreement (as amended, the 2025 Term Loan Credit Agreement) among the Company, as borrower, certain of our subsidiaries, as guarantors, each lender from time to time party thereto, and U.S. Bank National Association, as the administrative agent. The 2025 Term Loan Credit Agreement has a maturity of two years and provides for a term loan of $750. Proceeds of the term loan were applied to pay down the Company’s U.S. commercial paper capacity and for other general corporate purposes, including working capital needs. In connection with the entry into the 2025 Revolving Credit Agreement, on July 30, 2025, the Company and lenders entered into an amendment to the 2025 Term Loan Credit Agreement to modify certain covenant baskets and other terms (including amendments to the leverage ITT Inc. | Q2 2026 Form 10-Q | 37 ratio definition) to conform to the 2025 Revolving Credit Agreement. During the six months ended July 4, 2026, we made principal payments of $425.0 reducing the remaining outstanding principal balance to $95.0 as of July 4, 2026.

The decrease in net cash from operating activities of $73.5$36.0 was primarily due to $71.4the transaction expenses paid relatedin toconnection with the SPX FLOW acquisition, as well as higher interest and income tax payments, and increasedunfavorable commodityworking pre-purchasescapital changes primarily due to securethe supplytiming andof cost.customer payments. The decrease was partially offset by increased cash generated from segment operations.