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

The Company has had significant divestiture activity in the past in accordance with its portfolio management initiative,initiative. and itIt divested one business in the first quarter of 2023 as it continues portfolio refinements to maintain portfolio discipline. The Company has retained certain liabilities directly or through indemnifications made to the buyers against known and unknown contingent liabilities such as lawsuits, tax liabilities, product liability claims and environmental matters, which could adversely affect the Company's financial results.

The Company has a decentralized operating structure under which its individual businesses are allowed significant decision-making autonomy within the Company's strategic framework and internal financial and compliance controls. The Company is subject to complex U.S., foreign and other local laws and regulations that are applicable to its operations, such as anti-bribery and anti-corruption, competition, export and import, trade sanctions, data privacy, environmental, the use of artificial intelligence in our business and in our products and services, and human rights laws. Although the Company has implemented compliance programs which include internal controls, internal audits, policies and procedures and employee training to deter prohibited practices, these measures may not be effective in preventing employees, agents or business partners from violating or circumventing such internal policies and violating applicable laws and regulations. Any such improper actions could subject the Company to civil or criminal investigations, could lead to substantial civil or criminal monetary and non-monetary penalties against the Company or its subsidiaries, or could damage its reputation.

This Annual Report on Form 10-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "believe," "expect," "plans," "intend," "may," "strategy," "prospects," "estimate," "will," "should," "could," "project," "target," "anticipate," "guidance," "forecast," and other similar words, and may include, without limitation, statements regarding the duration and potential effects of global supply chain challenges, relatedthe government actionscurrent and theexpected Company'simpact strategyof inU.S. responsetrade theretopolicy, onincluding tariffs and related retaliatory countermeasures, the Company'sexpected business,impact of the One Big Beautiful Bill Act, future financial and operating performance, free cash flow, economic and regulatory conditions in various geographic regions, the impact of foreign currency fluctuations, the timing and amount of benefits from the Company's enterprise strategy initiatives, the timing and amount of dividends and share repurchases, the protection of the Company's intellectual property, the likelihood of future goodwill or intangible asset impairment charges, the impact of adopting new accounting pronouncements, the adequacy of internally generated funds and credit facilities to service debt and finance the Company's capital allocation priorities, the sufficiency of U.S. generated cash to fund cash requirements in the U.S., the cost and availability of additional financing, the availability of raw materials and energy and the impact of raw material cost inflation, the Company's enterprise initiatives, the Company's portion of future benefit payments related to pension and postretirement benefits, the Company's information technology infrastructure, potential acquisitions and divestitures and the expected performance of acquired businesses and impact of divested businesses, the impact of U.S. and global tax legislation and the estimated timing and amount related to the resolution of tax matters, the cost of compliance with environmental regulations, the impact of interest rate changes, the impact of failure of the Company's employees to comply with applicable laws and regulations, and the outcome of outstanding legal proceedings. These statements are subject to certain risks, uncertainties, and other factors, which could cause actual results to differ materially from those anticipated. Important risks that may influence future results include those risks described above. These risks are not all inclusive and given these and other possible risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

•Customer-back Innovation has fueled decades of profitable growth at ITW. The Company's unique innovation approach is built on insight gathered from the 80/20 Front-to-Back process. Working from the customer back, ITW businesses position themselves as the go-to problem solver for their "80" customers. ITW's innovation efforts are focused on understanding customer needs, particularly those in "80" markets with solid long-term growth fundamentals, and creating unique solutions to address those needs. These customer insights and learnings drive innovation at ITW and have contributed to a portfolio of approximately 20,90021,800 granted and pending patents; and

In the Next Phase of the Company's evolution, the ITW Business Model and the Enterprise Strategy framework will be as formidable of a competitive advantage and performance differentiator as it has been over the last decade, if not more so. Volatility, risk and the pace of change in the global operating environment will continue to increase, and a decentralized entrepreneurial culture allows the Company to be a fast adaptor – to read, react, respond and evolve. The Company’sCompany's ability to consistently execute and invest through the ups and downs of the business cycle is now a defining competitive advantage.

In the fourth quarter of 2022, plans were approved to divest one business in the Specialty Products segment. This business was presented as held for sale beginning in the fourth quarter of 2022. This business was sold on April 3, 2023, with no significant gain or loss upon sale. Operating revenue related to this business that was included in the Company's results of operations was $9 million and $37 million for the twelve months ended December 31, 2023 and 2022, respectively.2023. Refer to Note 3. Divestitures in Item 8. Financial Statements and Supplementary Data for further information regarding the Company's divestitures.

On January 2, 2024, the Company completed the acquisition of one business in the Test & Measurement and Electronics segment for $57 million, net of cash acquired. On April 1, 2024, the Company completed the acquisition of one business in the Test & Measurement and Electronics segment for $59 million, net of cash acquired. The Company has completed the allocation of purchase price for both acquisitionsof wasthese acquisitions. On October 1, 2025, the Company completed the acquisition of one business in the Test & Measurement and Electronics segment for $120 million, net of cash acquired, and subject to certain closing adjustments. The allocation of purchase price for this acquisition will be completed as soon as practicable, but no later than one year from the acquisition date. These acquisitions were not material, individually or in the aggregate, to the Company’sCompany's results of operations, financial position or cash flows. Refer to Note 2. Acquisitions in Item 8. Financial Statements and Supplementary Data for further information regarding the Company's acquisitions.

On August 5, 2024, the Company entered into a purchase agreement with affiliates of Clayton, Dubilier & Rice, LLC ("CD&R") for the sale of the Company’sCompany's noncontrolling equity interest in Wilsonart International Holdings LLC ("Wilsonart") for $398 million. The transaction closed immediately after the execution of the purchase agreement. Proceeds from the transaction, net of transaction costs, were $395 million, resulting in a pre-tax gain of $363 million which was included in Other income (expense) in the Statement of Income. Income taxes on the gain were more than offset by a discrete tax benefit of $107 million in the third quarter of 2024 related to the utilization of capital loss carryforwards upon the sale of Wilsonart. The sale of the Company’s equity interest in Wilsonart is not expected to have a material impact on the Company’s financial results in subsequent periods. Refer to Note 5. Other Income (Expense) and Note 6. Income Taxes in Item 8. Financial Statements and Supplementary Data for additional information regarding this transaction.

During the first quarter of 2022, Russian military forces invaded Ukraine. In response, the United States and several other countries imposed economic and other sanctions on Russia. The Company has four immaterial Russian subsidiaries with totalnet assets of approximately $22$38 million as of December 31, 2024.2025. The revenue for these four subsidiaries for the twelve months ended December 31, 20242025 was approximately $24 million. These subsidiaries were not material to the Company's results of operations or financial position.

In the fourth quarter of 2022, plans were approved to divest one business in the Specialty Products segment. This business was presented as held for sale beginning in the fourth quarter of 2022. This business was sold on April 3, 2023, with no significant gain or loss upon sale. Operating revenue related to this business that was included in the Company's results of operations was $9 million for the twelve months ended December 31, 2023 and 2022 was $9 million and $37 million, respectively.2023. Refer to Note 3. Divestitures in Item 8. Financial Statements and Supplementary Data for further information regarding the Company's divestitures.

On January 2, 2024, the Company completed the acquisition of one business in the Test & Measurement and Electronics segment for $57 million, net of cash acquired. On April 1, 2024, the Company completed the acquisition of one business in the Test & Measurement and Electronics segment for $59 million, net of cash acquired. The Company has completed the allocation of purchase price for both acquisitionsof wasthese acquisitions. On October 1, 2025, the Company completed the acquisition of one business in the Test & Measurement and Electronics segment for $120 million, net of cash acquired, and subject to certain closing adjustments. These acquisitions were not material, individually or in the aggregate, to the Company’s results of operations, financial position or cash flows. The allocation of purchase price for thesethis acquisitionsacquisition will be completed as soon as practicable, but no later than one year from the acquisition date. These acquisitions were not material, individually or in the aggregate, to the Company's results of operations, financial position or cash flows. Refer to Note 2. Acquisitions in Item 8. Financial Statements and Supplementary Data for further information regarding the Company's acquisitions.

During the first quarter of 2024, the Company changed the method used to determine the cost of inventory at certain U.S. businesses from the last-in, first-out ("LIFO") method to the first-in, first-out ("FIFO") method, as the Company believes the FIFO method is preferable because it provides a more consistent method for valuing inventory across the Company’sCompany's operations, improves comparability with peers, and better reflects the current value of inventories at the balance sheet date. The LIFO provision for the yearsyear ended December 31, 2023 and 2022 was $6 million of expense and $7 million of income, respectively,expense, and was not material to the Company’s results of operations, financial position or cash flows. Therefore, the Company recorded the pre-tax cumulative effect of this change in accounting method of $117 million as a reduction of Cost of revenue in the first quarter of 2024. Refer to Note 1. Description of Business and Summary of Significant Accounting Policies in Item 8. Financial Statements and Supplementary Data for additional information regarding this change in accounting method and the Company’sCompany's inventory balances.

On August 5, 2024, the Company entered into a purchase agreement with affiliates of CD&R for the sale of the Company’sCompany's noncontrolling equity interest in Wilsonart. The transaction closed immediately after the execution of the purchase agreement. Proceeds from the transaction, net of transaction costs, were $395 million, resulting in a pre-tax gain of $363 million which was included in Other income (expense) in the Statement of Income. Income taxes on the gain were more than offset by a discrete tax benefit of $107 million in the third quarter of 2024 related to the utilization of capital loss carryforwards upon the sale of Wilsonart. The sale of the Company’s equity interest in Wilsonart is not expected to have a material impact on the Company’s financial results in subsequent periods. Refer to Note 5. Other Income (Expense) and Note 6. Income Taxes in Item 8. Financial Statements and Supplementary Data for additional information regarding this transaction.

In a challenging and dynamic environment,2025, the Company delivered solid financial results in 2024a challenging and dynamic environment primarily due to the continued successfulstrong execution ofon enterprise initiatives andas continuedan focusoutcome onof the highly differentiated ITW Business Model.

Selling, administrative, and research and development expenses were $2.7$2.78 billion in 2024,2025, $2.6$2.68 billion in 20232024 and $2.6$2.64 billion in 2022.2023. Selling, administrative, and research and development expenses in 2025 increased 3.9% compared to 2024 primarily due to higher employee-related expenses and higher research and development expenses, partially offset by benefits from the Company's enterprise initiatives. Expenses in 2024 increased 1.4% compared to 2023 primarily driven by higher employee-related expenses and the impact of acquisitions in 2024. Selling, administrative, and research and development expenses as a percent of operating revenue were higher in 2024 compared to 2023, as higher employee-related expenses and the unfavorable impact of acquisitions in the first and second quarters of 2024 were partially offset by benefits from the Company's enterprise initiatives. Expenses in 2023 increased 2.3% compared to 2022 driven by a 3.0% increase resulting from higher organic revenue, partially offset by the impact of divestiture activity which reduced expenses by 0.7%. Selling, administrative, and research and development expenses as a percent of operating revenue were slightly higher in 2023 compared to 2022 primarily due to higher employee-related expenses and research and development expenses, partially offset by positive operating leverage and benefits from the Company's enterprise initiatives.

Segments are allocated a fixed overhead charge based on the segment's revenue. Expenses not charged to the segments are reported separately as Unallocated. Because the Unallocated category includes a variety of items, it is subject to fluctuations on a quarterly and annual basis. Unallocated expenses in 2025 included higher employee-related expenses, including health and welfare expenses and insurance-related expenses as compared to 2024. Unallocated expenses in 2024 included the favorable pre-tax cumulative effect of the LIFO accounting method change of $117 million in the first quarter of 2024. Refer to Note 1. Description of Business and Summary of Significant Accounting Policies in Item 8. Financial Statements and Supplementary Data for additional information regarding this change in accounting method and the Company’sCompany's inventory balances. Unallocated expenses in 2023 were lower as compared to 2022 primarily due to the impact of lower corporate expenses, including favorable health and welfare expenses, and an immaterial insurance recovery.

•Product line simplification ("PLS") - focuses businesses on eliminating the complexity and overhead costs associated with smaller product lines and customers, and focuses businesses on supporting and growing their largest customers and product lines. In the short-term, PLS may result in a decrease in revenue and overhead costs while improving operating margin. In the long-term, PLS is expected to result in growth in revenue, profitability,profitability and returns.

During the first quarter of 2022, Russian military forces invaded Ukraine. In response, the United States and several other countries imposed economic and other sanctions on Russia. The Company has four immaterial Russian subsidiaries with net assets of approximately $38$42 million as of MarchJune 31,30, 2026. The revenue for these four subsidiaries for the three and six months ended MarchJune 31,30, 2026 was approximately $6$8 million.million and $14 million, respectively. These subsidiaries are not material to the Company's results of operations or financial position.

On April 2, 2025, the United States government announced additional tariffs on goods imported to the U.S. from numerous countries. In response, certain countries retaliated with additional counter-tariffs or negotiated with the U.S. government regarding tariffs. Tariffs on goods from many countries became effective on August 1, 2025. On February 20, 2026, the U.S. Supreme Court invalidated many of the tariffs imposed under the International Emergency Economic Powers Act (the "IEEPA"), resulting in the termination of many tariffs imposed in 2025. Following this decision, a new temporary 10 percent global tariff was imposed under the Trade Act, which may remainexpired in effectJuly up2026, toand 150was days.effectively replaced by similar tariffs imposed on numerous countries under different provisions of the Trade Act. The Company believes that it continues to be well positioned to minimize the impact of these tariffs because its businesses generally manufacture products in the markets where they are sold and the Company expects to recover any increased cost due to tariffs through price increases. However, current tariff policies have introduced additional uncertainty and may negatively impact overall demand from the Company's customers. The Company continues to assess the impact of the tariffs and actions that can be taken to moderate and/or minimize their effects on the Company.

In an uncertain external environment, theThe Company delivered solid financial results in the firstsecond quarter and year-to-date periods of 2026 primarily due to the continued successful execution of enterprise initiatives and continued focus on the highly differentiated ITW Business Model.

Refer to the "Results of Operations for Total Company" and the "Results of Operations by Segment" sections for discussion of changes in operating revenue for the firstsecond quarter and year-to-date periods of 2026 compared to 2025.

Cost of revenue was $2.3$2.4 billion and $2.2$2.3 billion in the firstsecond quarter of 2026 and 2025, respectively, an increase of 4.4%,5.8%, primarily due to higher revenue and higher employee-related expenses. Cost of revenue as a percent of operating revenue was lower in the second quarter of 2026 compared to 2025 as benefits from the Company's enterprise initiatives were essentiallypartially offset by higher employee-related expensesexpenses. In the year-to-date period, Cost of revenue was $4.7 billion and $4.4 billion in 2026 and 2025, respectively, an increase of 5.1%, primarily due to higher revenue and higher revenue.employee-related expenses. Cost of revenue as a percent of operating revenue was lower in the year-to-date period of 2026 compared to 2025 as benefits from the Company's enterprise initiatives were partially offset by higher employee-related expenses.

Selling, administrative, and research and development expenses were $722$735 million and $706$693 million in the firstsecond quarter of 2026 and 2025, respectively, an increase of 2.3%.6.1%. Selling, administrative, and research and development expenses as a percent of operating revenue was flat in 2026 compared to 2025 as benefits from the Company's enterprise initiatives were offset by higher selling, advertising and employee-related expenses. In the year-to-date period, Selling, administrative, and research and development expenses were $1.5 billion and $1.4 billion in 2026 and 2025, respectively, an increase of 4.1%. Selling, administrative, and research and development expenses as a percent of operating revenue were lower in the year-to-date period of 2026 compared to 2025 primarily due to benefits from the Company's enterprise initiatives, partially offset by higher selling, advertising and research and developmentemployee-related expenses.

Amortization and impairment of intangible assets was lower in the firstsecond quarter and year-to-date periods of 2026 compared to 2025 primarily due to fully amortized intangible assets.

Refer to the "Results of Operations for Total Company" and the "Results of OperationOperations by Segment" sections for additional discussion of operating results for the firstsecond quarter and year-to-date periods of 2026 compared to 2025.

The Company's consolidated results of operations for the firstsecond quarter and year-to-date periods of 2026 and 2025 were as follows:

•Operating revenue grew in the second quarter and year-to-date periods due to higher organic and acquisition revenues and the favorable effect of foreign currency translation and higher organic and acquisition revenues.translation.

•Organic revenue increased 0.4%4.5% asin the second quarter and 2.5% in the year-to-date period primarily driven by growth in the Test & Measurement and Electronics, Welding and Polymers & Fluids segments was partially offset by a decline in the Specialty Products, Food Equipment, Automotive OEM and Construction Products segments. Product line simplification activities reduced organic revenue by 60 basis points.points in both the second quarter and year-to-date periods.

◦North American organic revenue grew 1.2%6.4% in the second quarter as growth in the Welding, Test & Measurement and Electronics, Welding and Polymers & FluidsFluids, Construction Products, Specialty Products and Automotive OEM segments was partially offset by a decrease in the Food Equipment,Equipment Specialtysegment. Products,In Automotivethe OEMyear-to-date period, organic revenue increased 3.8% due to growth in the Welding, Test & Measurement and Electronics, Polymers & Fluids and Construction Products segments, partially offset by a decline in the Food Equipment, Specialty Products and Automotive OEM segments.

◦Europe, Middle East and Africa organic revenue decreasedwas 2.2%flat in the second quarter as growth in the Food Equipment, Polymers & Fluids, Construction Products and Specialty Products segments was offset by a decline in the Automotive OEM, Test & Measurement and Electronics and Welding segments. In the year-to-date period, organic revenue declined 1.1% as a declinedecrease in the Test & Measurement and Electronics, Automotive OEM, Welding and Construction Products and Welding segments was partially offset by growth in the SpecialtyFood Products,Equipment, Polymers & Fluids, Food EquipmentFluids and AutomotiveSpecialty OEMProducts segments.

•Operating margin was 26.7% in the second quarter. The increase of 25.4% increased 6040 basis points was primarily due to benefits from the Company's enterprise initiatives of 120 basis points and lowerpositive restructuringoperating expensesleverage of 3090 basis points, partially offset by higher employee-related expenses.expenses and unfavorable price/cost of 40 basis points.

•The Company's effective tax rate for the firstsecond quarter of 2026 and 2025 was 20.6%24.4% in both periods and 21.7%,22.6% and 23.1% for the year-to-date periods of 2026 and 2025, respectively. The effective tax rate for the firstyear-to-date quarterperiod of 2026 included a discrete tax benefit of $34 million in the first quarter of 2026 primarily related to the resolution of a U.S. tax audit. TheAdditionally, the effective tax rate for the firstyear-to-date quarterperiod of 2025 included a discrete tax benefit of $21 million in the first quarter of 2025 related to the reversal of a valuation allowance on net operating loss carryforwards. Additionally, theThe effective tax rates for 2026 and 2025 also included discrete tax benefits related to excess tax benefits from stock-based compensation of $4$1 million for boththe second quarter of 2025, and $4 million and $5 million for the firstyear-to-date quarterperiods of 2026 and 2025.2025, respectively.

•Diluted earnings per share ("EPS") of $2.66$2.84 for the firstsecond quarter and $5.50 for the year-to-date period of 2026 increased 11.8%.10.1% and 11.1%, respectively.

•The Company repurchased approximately 1.42.9 million and 4.3 million shares of its common stock in the firstsecond quarter and year-to-date periods of 20262026, respectively, for approximately $375$750 million.million and $1.1 billion, respectively.

Total operating revenue and operating income for the firstsecond quarter and year-to-date periods of 2026 and 2025 were as follows:

This segment is a global, niche supplier to top tier OEMs, providing unique innovation to address pain points for sophisticated customers with complex problems. Businesses in this segment produce components and fasteners for automotive-related applications. This segment primarily serves the automotive original equipment manufacturersOEMs and tiers market. Products in this segment include:

The results of operations for the Automotive OEM segment for the firstsecond quarter and year-to-date periods of 2026 and 2025 were as follows:

•Operating revenue grew in the second quarter and year-to-date periods due to the favorable effect of foreign currency translation, partially offset by lower organic revenue.

•Organic revenue decreased 0.9%0.4% in the second quarter and 0.6% in the year-to-date period compared to worldwide auto builds which declinedwere 3%.flat in the second quarter and decreased 1% in the year-to-date period. Product line simplification activities reduced organic revenue by 10080 basis points.points in the second quarter and 90 basis points in the year-to-date period.

◦North American organic revenue declinedgrew 4.9%1.3% and decreased 1.8% in the second quarter and year-to-date periods, respectively, compared to North American auto builds which decreasedwere 2%,flat in the second quarter and declined 1% in the year-to-date period, primarily due to product line simplification activities.activities and customer mix.

◦European organic revenue increaseddecreased 0.1%5.3% in the second quarter and 2.7% in the year-to-date period compared to European auto builds which declined 1%.1% The business outperformedin the marketsecond quarter and were flat in the year-to-date period, primarily due to marketcustomer penetrationmix gains.and product line simplification activities.

◦Asia Pacific organic revenue grew 2.7%,3.1% and 2.9% in the second quarter and year-to-date periods, respectively, primarily due to market growth and penetration gains in India and South Korea, partially offset by a decline in China.India. Organic revenue in China decreasedincreased 3.2%0.5% and declined 1.2% in the second quarter and year-to-date periods, respectively, compared to China auto builds which declined 10%.3% in the second quarter and 5% in the year-to-date period. Auto builds of foreign automotive manufacturers in China decreased 18%.31% in the second quarter and 23% in the year-to-date period. The business outperformed the market primarily due to marketcustomer penetration gainsmix including growth in the electric vehiclesvehicle end market.

•Operating margin was 21.6% in the second quarter. The increase of 21.0% increased 17030 basis points was primarily due to benefits from the Company's enterprise initiatives and lower restructuring expenses of 80 basis points,initiatives, partially offset by unfavorable price/cost of 90 basis points, higher employee-related expenses,expenses and continued investment in the business and unfavorable operating leverage of 20 basis points.business.

The results of operations for the Food Equipment segment for the firstsecond quarter and year-to-date periods of 2026 and 2025 were as follows:

•Operating revenue grew in the second quarter due to the favorable effect of foreign currency translation. In the year-to-date period, operating revenue increased due to the favorable effect of foreign currency translation, partially offset by lower organic revenue.

•Organic revenue decreasedwas 2.8%flat in the second quarter as equipment organic revenue declined 6.0%2.4% and service organic revenue increased 5.0%. In the year-to-date period, organic revenue declined 1.3% as equipment organic revenue decreased 4.1% and service organic revenue grew 3.2%.4.1%.

◦North American organic revenue decreased 4.7%.3.5% in the second quarter and 4.1% in the year-to-date period. Equipment organic revenue declined 10.1%8.2% and 9.1% in the second quarter and year-to-date periods, respectively, primarily due to lower demand in the institutional end market and foodindependent retailand endquick markets,service partiallyrestaurants offset by higher demand inwithin the noninstitutional end market, primarily in the quick serve restaurant end market. Service organic revenue grewincreased 4.1%.4.9% in the second quarter and 4.5% in the year-to-date period.

◦International organic revenue grew 0.2%.5.7% and 3.1% in the second quarter and year-to-date periods, respectively. Equipment organic revenue decreasedincreased 0.4%6.2% in the second quarter and 3.0% in the year-to-date period primarily due to lower demand in the European cooking and refrigeration end markets, partially offset by higher demand in the European warewash end market and higher demand in Asia.Asia, partially offset by lower demand in the European cooking and refrigeration end markets. Service organic revenue grew 1.5%.5.3% in the second quarter and 3.4% in the year-to-date period.

•Operating margin ofwas 24.7%27.1% decreasedin 180the basissecond pointsquarter. primarilyThe due to product mix, unfavorable operating leveragedecrease of 60 basis points andwas primarily due to higher employee-related expenses,expenses and product mix, partially offset by benefits from the Company's enterprise initiatives and lowerfavorable restructuring expensesprice/cost of 2010 basis points.

This segment is a branded and innovative producer of test and measurement and electronic manufacturing and maintenance, repair, and operations, or "MRO" solutions that improve efficiency and quality for customers in diverse end markets. Businesses in this segment produce equipment, consumables, and related software for testing and measuring of materials and structures, as well as equipment and consumables used in the production of electronic subassemblies and microelectronics. This segment primarily serves the electronics, general industrial, automotive original equipment manufacturersOEMs and tiers, energy, industrial capital goods and consumer durables markets. Products in this segment include:

The results of operations for the Test & Measurement and Electronics segment for the firstsecond quarter and year-to-date periods of 2026 and 2025 were as follows:

•Operating revenue grew in the second quarter and year-to-date periods due to higher organic and acquisition revenuesrevenues, and the favorable effect of foreign currency translation.

•Organic revenue increased 4.6%10.0% in the second quarter and 7.4% in the year-to-date period primarily due to higher demand in the semiconductor and electronics end markets, partially offset by lower demand in the general industrial end market.markets.

◦Organic revenue for the test and measurement businesses increased 1.4%4.2% in the second quarter and 2.9% in the year-to-date period primarily driven by higher demand in the semiconductor end market, primarily in North America and Asia Pacific, and growth in Instron, partially offset by a decline in the MTS Test & Simulation business.

◦Electronics organic revenue grew 21.0% in the second quarter and increased 10.3%15.7% in the year-to-date period primarily due to higher demand in the semiconductor end market. The electronics assembly businesses grew 24.7%49.2% in the second quarter and increased 36.9% in the year-to-date period primarily due to higher demand inacross Northall Americamajor and Asia Pacific.regions. The other electronics businesses, which include the contamination control, static control and pressure sensitive adhesives businesses, grewincreased 5.1%11.3% in the second quarter and 8.3% in the year-to-date period primarily due to higher demand in North America and Asia Pacific, partially offset by a decline in Europe.

•Operating margin was 25.2% in the second quarter. The increase of 22.9% increased 150240 basis points was primarily due to positive operating leverage of 130250 basis points,points and benefits from the Company's enterprise initiatives and lower restructuring expenses of 50 basis points,initiatives, partially offset by higher employee-related expenses and the dilutive impact of 6020 basis points from an acquisition and higher employee-related expenses.acquisition.

This segment is a branded value-added equipment and specialty consumable manufacturer with innovative and leading technology. Businesses in this segment produce arc welding equipment, consumables and accessories for a wide array of industrial and commercial applications. This segment primarily serves the general industrial market, which includes fabrication, shipbuilding and other general industrial markets, and construction, energy, MRO, industrial capital goods and automotive original equipment manufacturersOEMs and tiers markets. Products in this segment include:

The results of operations for the Welding segment for the firstsecond quarter and year-to-date periods of 2026 and 2025 were as follows:

•Operating revenue grew in the second quarter and year-to-date periods due to higher organic revenue and the favorable effect of foreign currency translation.

•Organic revenue increased 6.0%13.9% in the second quarter as equipment and consumables grew 8.1%18.7% and 2.1%,6.0%, respectively. In the year-to-date period, organic revenue grew 10.0% as equipment increased 13.4% and consumables grew 4.1%.

◦North American organic revenue increased 8.4%18.5% and 13.5% in the second quarter and year-to-date periods, respectively, primarily due to growth in the industrial end market of 16.7% and 11.9%, respectively, and in the commercial end marketsmarket of 7.2%14.2% and 5.6%,9.9%, respectively,respectively. andThe growth in both periods was primarily due to higher demand in the infrastructure, energy, aerospace and defense end market.markets.

◦International organic revenue declined 6.2%6.4% in the second quarter and 6.3% in the year-to-date period primarily due to lower demand in Asia Pacific and Middle East.Europe.

•Operating margin was 32.4% in the second quarter. The decrease of 32.1% decreased 4070 basis points was primarily due to higher employee-related expenses, unfavorable price/cost of 50 basis points and higher restructuring expenses of 30 basis points, partially offset by positive operating leverage of 100220 basis points and benefits from the Company's enterprise initiatives.

The results of operations for the Polymers & Fluids segment for the firstsecond quarter and year-to-date periods of 2026 and 2025 were as follows:

•Operating revenue grew in the second quarter and year-to-date periods due to higher organic revenue and the favorable effect of foreign currency translation and higher organic revenue.translation.

•Organic revenue increased 1.7%7.3% in the second quarter and 4.6% in the year-to-date period due to higher demand across all major regions. Product line simplification activities reduced organic revenue by 7030 basis points.points and 50 basis points in the second quarter and year-to-date periods, respectively.

◦Organic revenue for the automotive aftermarket businesses increased 2.9%7.4% in the second quarter primarily due to higher demand in the car care, engine repair and body repair businesses in North America and the tire repair business in Asia Pacific and Europe. In the year-to-date period, organic revenue grew 5.1% primarily due to higher demand in the car care, engine repair and tire repair businesses in North America and the tire repair business in Asia Pacific and Europe.Europe, partially offset by lower demand in the body repair business.