Item 1. FINANCIAL STATEMENTS.

EATON CORPORATION plc

CONSOLIDATED STATEMENTS OF INCOME

			Three months ended June 30												Six months ended June 30
(In millions except for per share data)			2025						2024						2025						2024
Net sales			$	7,028					$	6,350					$	13,404					$	12,293
Cost of products sold			4,431						3,940						8,361						7,665
Selling and administrative expense			1,149						1,021						2,197						2,046
Research and development expense			192						196						390						385
Interest expense - net			71						29						103						59
Other income - net			(1)						(32)						(10)						(58)
Income before income taxes			1,186						1,195						2,363						2,195
Income tax expense			203						201						415						379
Net income			982						994						1,947						1,816
Less net income for noncontrolling interests			(1)						(1)						(2)						(2)
Net income attributable to Eaton ordinary shareholders			$	982					$	993					$	1,945					$	1,814
Net income per share attributable to Eaton ordinary shareholders
Diluted			$	2.51					$	2.48					$	4.96					$	4.52
Basic			2.52						2.49						4.97						4.54
Weighted-average number of ordinary shares outstanding
Diluted			391.4						401.0						392.5						401.5
Basic			390.3						399.2						391.2						399.6
Cash dividends declared per ordinary share			$	1.04					$	0.94					$	2.08					$	1.88

The accompanying notes are an integral part of these condensed consolidated financial statements.

EATON CORPORATION plc

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

			Three months ended June 30												Six months ended June 30
(In millions)			2025						2024						2025						2024
Net income			$	982					$	994					$	1,947					$	1,816
Less net income for noncontrolling interests			(1)						(1)						(2)						(2)
Net income attributable to Eaton ordinary shareholders			982						993						1,945						1,814
Other comprehensive income (loss), net of tax
Currency translation and related hedging instruments			179						(125)						263						(178)
Pensions and other postretirement benefits			(21)						13						(24)						30
Cash flow hedges			(3)						(10)						8						(14)
Other comprehensive income (loss) attributable to Eaton ordinary shareholders			155						(122)						247						(162)
Total comprehensive income attributable to Eaton ordinary shareholders			$	1,137					$	871					$	2,192					$	1,652

The accompanying notes are an integral part of these condensed consolidated financial statements.

EATON CORPORATION plc

CONSOLIDATED BALANCE SHEETS

(In millions)			June 30, 2025						December 31, 2024
Assets
Current assets
Cash			$	398					$	555
Short-term investments			186						1,525
Accounts receivable - net			5,486						4,619
Inventory			4,581						4,227
Prepaid expenses and other current assets			1,246						874
Total current assets			11,897						11,801
Property, plant and equipment
Land and buildings			2,299						2,239
Machinery and equipment			7,328						6,823
Gross property, plant and equipment			9,627						9,062
Accumulated depreciation			(5,595)						(5,333)
Net property, plant and equipment			4,032						3,729
Other noncurrent assets
Goodwill			15,790						14,713
Other intangible assets			5,227						4,658
Operating lease assets			709						806
Deferred income taxes			621						609
Other assets			2,230						2,066
Total assets			$	40,507					$	38,381
Liabilities and shareholders’ equity
Current liabilities
Short-term debt			$	1,111					$	—
Current portion of long-term debt			1,134						674
Accounts payable			3,762						3,678
Accrued compensation			529						670
Other current liabilities			3,058						2,835
Total current liabilities			9,594						7,857
Noncurrent liabilities
Long-term debt			8,751						8,478
Pension liabilities			758						741
Other postretirement benefits liabilities			161						164
Operating lease liabilities			587						669
Deferred income taxes			280						275
Other noncurrent liabilities			1,728						1,667
Total noncurrent liabilities			12,265						11,994
Shareholders’ equity
Ordinary shares (389.3 million outstanding in 2025 and 392.9 million in 2024)			4						4
Capital in excess of par value			12,780						12,731
Retained earnings			9,917						10,096
Accumulated other comprehensive loss			(4,095)						(4,342)
Shares held in trust			—						(1)
Total Eaton shareholders’ equity			18,606						18,488
Noncontrolling interests			41						43
Total equity			18,647						18,531
Total liabilities and equity			$	40,507					$	38,381

The accompanying notes are an integral part of these condensed consolidated financial statements.

EATON CORPORATION plc

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

			Six months ended June 30
(In millions)			2025						2024
Operating activities
Net income			$	1,947					$	1,816
Adjustments to reconcile to net cash provided by operating activities
Depreciation and amortization			493						452
Deferred income taxes			123						9
Pension and other postretirement benefits expense			20						11
Contributions to pension plans			(58)						(64)
Contributions to other postretirement benefits plans			(9)						(8)
Changes in working capital			(1,397)						(784)
Other - net			37						(11)
Net cash provided by operating activities			1,156						1,421
Investing activities
Capital expenditures for property, plant and equipment			(349)						(370)
Cash paid for acquisition of businesses, net of cash acquired			(1,450)						(51)
Proceeds from sales of property, plant and equipment			53						77
Investments in associate companies			(16)						(68)
Return of investment from associate companies			—						33
Sales (purchases) of short-term investments - net			1,343						(126)
Proceeds from (payments for) settlement of currency exchange contracts not designated as hedges - net			(21)						1
Other - net			(49)						(7)
Net cash used in investing activities			(490)						(511)
Financing activities
Proceeds from borrowings			1,058						1,084
Payments on borrowings			(713)						(399)
Short-term debt, net			1,111						(4)
Cash dividends paid			(818)						(756)
Exercise of employee stock options			29						46
Repurchase of shares			(1,307)						(738)
Employee taxes paid from shares withheld			(46)						(63)
Other - net			(11)						(8)
Net cash used in financing activities			(697)						(839)
Effect of currency on cash			(126)						(20)
Total increase (decrease) in cash			(157)						52
Cash at the beginning of the period			555						488
Cash at the end of the period			$	398					$	540

The accompanying notes are an integral part of these condensed consolidated financial statements.

EATON CORPORATION plc

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Amounts are in millions unless indicated otherwise (per share data assume dilution). Columns and rows may not add and the sum of components may not equal total amounts reported due to rounding.

Note 1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of Eaton Corporation plc (Eaton or the Company) have been prepared in accordance with generally accepted accounting principles for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by United States generally accepted accounting principles (US GAAP) for complete financial statements. However, in the opinion of management, all adjustments (consisting of normal recurring accruals) have been made that are necessary for a fair presentation of the condensed consolidated financial statements for the interim periods.

This Form 10-Q should be read in conjunction with the consolidated financial statements and related notes included in Eaton’s 2024 Form 10-K. The interim period results are not necessarily indicative of the results to be expected for the full year. Management has evaluated subsequent events through the date this Form 10-Q was filed with the Securities and Exchange Commission.

Adoption of New Accounting Standard

Eaton adopted Accounting Standards Update 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, in the fourth quarter of 2024 on a retrospective basis. This accounting standard requires additional segment disclosures on an annual and interim basis, including significant segment expenses that are regularly provided to the chief operating decision maker. The standard does not change how operating segments and reportable segments are determined. The adoption of the standard did not have a material impact on the condensed consolidated financial statements.

Recently Issued Accounting Pronouncements

In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09). This accounting standard requires disaggregated income tax disclosures on an annual basis, including information on the Company’s effective income tax rate reconciliation and income taxes paid. ASU 2023-09 is effective for annual reporting periods beginning after December 15, 2024, and may be applied prospectively or retrospectively. The Company is evaluating the impact of ASU 2023-09 and expects the standard will only impact its income taxes disclosures with no material impact to the consolidated financial statements.

In November 2024, the FASB issued Accounting Standards Update 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). This accounting standard requires disaggregated income statement expense disclosures on an annual and interim basis, including inventory purchases, employee compensation, depreciation, and intangible asset amortization for each income statement line item that contains these expenses. The standard also requires disclosure of total selling expenses on an annual and interim basis, and the definition of those expenses disclosed annually. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, and may be applied prospectively or retrospectively. The Company is evaluating the impact of ASU 2024-03 and expects the standard will only impact its disclosures with no material impact to the consolidated financial statements.

Note 2. ACQUISITIONS OF BUSINESSES

Acquisition of Exertherm

On May 20, 2024, Eaton acquired Exertherm, a U.K.-based provider of thermal monitoring solutions for electrical equipment. Exertherm is reported within the Electrical Americas business segment.

Acquisition of a 49% stake in NordicEPOD AS

On May 31, 2024, Eaton acquired a 49 percent stake in NordicEPOD AS, which designs and assembles standardized power modules for data centers in the Nordic region. Eaton accounts for this investment on the equity method of accounting and it is reported within the Electrical Global business segment.

Acquisition of Fibrebond Corporation

On April 1, 2025, Eaton acquired Fibrebond Corporation (Fibrebond) for $1.45 billion, net of cash acquired. Fibrebond is a U.S. based designer and builder of pre-integrated modular power enclosures for data center, industrial, utility and communications customers. Fibrebond had sales of approximately $378 million for the twelve months ended February 28, 2025, and is reported within the Electrical Americas business segment.

The acquisition of Fibrebond has been accounted for using the acquisition method of accounting which requires the assets acquired and liabilities assumed be recognized at their respective fair values on the acquisition date. The table below summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed on the acquisition date. These preliminary estimates will continue to be revised during the measurement period as third-party valuations are received and finalized, further information becomes available and additional analyses are performed, and these differences could have a material impact on Eaton's preliminary purchase price allocation.

(In millions)																		April 1, 2025
Accounts receivable																		$	50
Inventory																		96
Prepaid expenses and other current assets																		72
Property, plant and equipment																		104
Other intangible assets																		709
Other assets																		3
Accounts payable																		(48)
Other current liabilities																		(106)
Other noncurrent liabilities																		(2)
Total identifiable net assets																		$	878
Goodwill																		572
Total consideration, net of cash received																		$	1,450

Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents the anticipated synergies of acquiring Fibrebond. Goodwill recognized as a result of the acquisition is expected to be deductible for tax purposes. Other intangible assets of $709 million are expected to include customer relationships, backlog, trademarks and technology. Given the timing of the acquisition, Eaton utilized a benchmarking approach based on similar acquisitions to determine the preliminary fair values for intangible assets. See Note 6 for additional information about goodwill.

As part of the acquisition, Eaton assumed $240 million of employee transaction and retention awards. Awards vest in six equal annual installments starting in the second quarter of 2025, subject to continued employment with Eaton. Forfeited employee awards are paid to former Fibrebond shareholders annually. Eaton recognizes compensation expense for the awards over the requisite service period and any employee forfeitures owed to former Fibrebond shareholders are expensed immediately in Other income - net. During the second quarter of 2025, compensation expense of $34 million, $11 million and $2 million were included in Costs of products sold, Selling and administrative expense, and Other income - net, respectively.

Eaton's 2025 condensed consolidated financial statements include Fibrebond results of operations, including segment operating profit of $44 million on sales of $144 million, from the date of acquisition through June 30, 2025.

Agreement to Acquire Ultra PCS Limited

On June 16, 2025, Eaton signed an agreement to acquire Ultra PCS Limited (Ultra PCS), which is headquartered in the United Kingdom with operations in the U.K. and the United States. Ultra PCS produces electronic controls, sensing, stores ejection and data processing solutions, enabling mission success for global aerospace customers in the air and on the ground. Under the terms of the agreement, Eaton will pay $1.55 billion for Ultra PCS. The transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the first half of 2026. Ultra PCS will be reported within the Aerospace business segment.

Agreement to Acquire Resilient Power Systems Inc.

On July 11, 2025, Eaton signed an agreement to acquire Resilient Power Systems Inc., a leading North American developer and manufacturer of innovative energy solutions, including solid-state transformer-based technology. Under the terms of the agreement, Eaton will pay $55 million of cash at closing and contingent future consideration and other payments that could reach $95 million based on 2025 through 2028 revenue performance, achievement of technology-based milestones, and in certain cases subject to management's continued employment with Eaton. The transaction is subject to customary closing conditions and is expected to close in the third quarter of 2025. Resilient Power Systems Inc. will be reported within the Electrical Americas business segment.

Note 3. REVENUE RECOGNITION

Sales are recognized when obligations under the terms of the contract are satisfied and control of promised goods or services have transferred to our customers. Control is transferred when the customer has the ability to direct the use of and obtain benefits from the goods or services. Sales are measured at the amount of consideration the Company expects to be paid in exchange for these products or services.

The following table provides disaggregated sales by lines of businesses, geographic destination, market channel or end market, as applicable, for the Company's operating segments:

			Three months ended June 30												Six months ended June 30
(In millions)			2025						2024						2025						2024
Electrical Americas
Products			$	817					$	745					$	1,560					$	1,478
Systems			2,533						2,132						4,800						4,089
Total			$	3,350					$	2,877					$	6,360					$	5,567
Electrical Global
Products			$	1,008					$	882					$	1,946					$	1,726
Systems			744						724						1,416						1,380
Total			$	1,753					$	1,606					$	3,362					$	3,105
Aerospace
Original Equipment Manufacturers			$	409					$	389					$	795					$	744
Aftermarket			396						329						746						620
Industrial and Other			275						237						518						462
Total			$	1,080					$	955					$	2,059					$	1,826
Vehicle
Commercial			$	377					$	454					$	736					$	889
Passenger and Light Duty			287						269						544						558
Total			$	663					$	723					$	1,280					$	1,447
eMobility			$	182					$	189					$	343					$	348
Total net sales			$	7,028					$	6,350					$	13,404					$	12,293

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (revenue recognized exceeds amount billed to the customer), and deferred revenue (advance payments and billings in excess of revenue recognized). Accounts receivable from customers were $4,923 million and $4,079 million at June 30, 2025 and December 31, 2024, respectively. Amounts are billed as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals or upon achievement of contractual milestones. These assets and liabilities are reported on the Consolidated Balance Sheets on a contract-by-contract basis at the end of each reporting period. Unbilled receivables were $510 million and $330 million at June 30, 2025 and December 31, 2024, respectively, and are recorded in Prepaid expenses and other current assets. The increase in unbilled receivables reflects higher revenue recognized and not yet billed from increased business activity in 2025 and unbilled receivables associated with the Fibrebond acquisition.

Changes in the deferred revenue liabilities are as follows:

(In millions)			Deferred Revenue
Balance at January 1, 2025			$	618
Customer deposits and billings			1,902
Revenue recognized in the period			(1,862)
Deferred revenue from business acquisition			73
Translation			15
Balance at June 30, 2025			$	746

(In millions)			Deferred Revenue
Balance at January 1, 2024			$	626
Customer deposits and billings			1,333
Revenue recognized in the period			(1,306)
Balance at June 30, 2024			$	653

Deferred revenue liabilities of $725 million and $602 million as of June 30, 2025 and December 31, 2024, respectively, were included in Other current liabilities on the Consolidated Balance Sheets with the remaining balance presented in Other noncurrent liabilities.

A significant portion of open orders placed with Eaton are by original equipment manufacturers or distributors. These open orders are not considered firm as they have been historically subject to releases by customers. In measuring backlog of unsatisfied or partially satisfied obligations, only the amount of orders to which customers are firmly committed are included. Using this criterion, total backlog at June 30, 2025 was approximately $17.5 billion. At June 30, 2025, approximately 70% of this backlog is targeted for delivery to customers in the next twelve months and the rest thereafter.

Note 4. CREDIT LOSSES FOR RECEIVABLES

Receivables are exposed to credit risk based on the customers’ ability to pay which is influenced by, among other factors, their financial liquidity position. Eaton’s receivables are generally short-term in nature with a majority outstanding less than 90 days.

Eaton performs ongoing credit evaluation of its customers and maintains sufficient allowances for potential credit losses. The Company evaluates the collectability of its receivables based on the length of time the receivable is past due, and any anticipated future write-off based on historic experience adjusted for market conditions. The Company's segments, supported by our global credit department, perform the credit evaluation and monitoring process to estimate and manage credit risk. The process includes an evaluation of credit losses for both the overall segment receivable and specific customer balances. The process also includes review of customer financial information and credit ratings, approval and monitoring of customer credit limits, and an assessment of market conditions. The Company may also require prepayment from customers to mitigate credit risk. Receivable balances are written off against an allowance for credit losses after a final determination of collectability has been made.

Accounts receivable are net of an allowance for credit losses of $56 million and $55 million at June 30, 2025 and December 31, 2024, respectively. The change in the allowance for credit losses includes expense and net write-offs, none of which are significant.

Note 5. INVENTORY

Inventory is carried at lower of cost or net realizable value. The components of inventory are as follows:

(In millions)			June 30, 2025						December 31, 2024
Raw materials			$	1,710					$	1,614
Work-in-process			1,214						1,038
Finished goods			1,656						1,576
Total inventory			$	4,581					$	4,227

Note 6. GOODWILL

Changes in the carrying amount of goodwill by segment are as follows:

(In millions)			January 1, 2025						Additions																		Translation						June 30, 2025
Electrical Americas			$	7,396					$	576																	$	28					$	8,000
Electrical Global			3,842						—																		334						4,176
Aerospace			2,856						—																		133						2,989
Vehicle			285						—																		5						290
eMobility			333						—																		2						335
Total			$	14,713					$	576																	$	502					$	15,790

The 2025 additions to goodwill relate primarily to the anticipated synergies of acquiring Fibrebond. The allocation of the Fibrebond purchase price is preliminary and will be completed during the measurement period.

Note 7. SUPPLY CHAIN FINANCE PROGRAM

The Company negotiates payment terms directly with its suppliers for the purchase of goods and services. In addition, a third-party financial institution offers a voluntary supply chain finance (SCF) program that enables certain of the Company’s suppliers, at the supplier’s sole discretion, to sell receivables due from the Company to the financial institution on terms directly negotiated with the financial institution. If a supplier elects to participate in the SCF program, the supplier decides which invoices are sold to the financial institution and the Company has no economic interest in a supplier’s decision to sell an invoice. Payments by the Company to participating suppliers are paid to the financial institution on the invoice due date, regardless of whether an individual invoice is sold by the supplier to the financial institution. The amounts due to the financial institution for suppliers that participate in the SCF program are included in Accounts payable on the Consolidated Balance Sheets, and the associated payments are included in operating activities on the Condensed Consolidated Statements of Cash Flows.

The changes in SCF obligations are as follows:

(In millions)			SCF Obligations
Balance at January 1, 2025			$	398
Invoices confirmed during the period			811
Invoices paid during the period			(739)
Balance at June 30, 2025			$	470

(In millions)			SCF Obligations
Balance at January 1, 2024			$	369
Invoices confirmed during the period			695
Invoices paid during the period			(695)
Translation			(1)
Balance at June 30, 2024			$	367

Note 8. DEBT

On May 9, 2025, a subsidiary of Eaton issued Euro denominated notes (2025 Euro Notes) with a face amount of €500 million ($564 million). The 2025 Euro Notes mature in 2035 with interest payable annually at a rate of 3.625% per annum. The issuer received proceeds totaling €494 million ($558 million) from the 2025 Euro Notes issuance, net of financing costs and discounts. The 2025 Euro Notes are fully and unconditionally guaranteed on an unsubordinated, unsecured basis by Eaton and certain of its direct and indirect subsidiaries. The 2025 Euro Notes contain customary optional redemption and par call provisions. The 2025 Euro Notes also contain a change of control provision which requires the Company to make an offer to purchase all or any part of the 2025 Euro Notes at a purchase price of 101% of the principal amount plus accrued and unpaid interest. The capitalized deferred financing fees are amortized in Interest expense - net over the term of the 2025 Euro Notes. The 2025 Euro Notes are subject to customary non-financial covenants.

Also on May 9, 2025, the same subsidiary of Eaton issued senior notes (2025 Notes) with a face amount of $500 million. The 2025 Notes mature in 2030 with interest payable semi-annually at a rate of 4.45% per annum. The issuer received proceeds totaling $495 million from the 2025 Notes issuance, net of financing costs and discounts. The 2025 Notes are fully and unconditionally guaranteed on an unsubordinated, unsecured basis by Eaton and certain of its direct and indirect subsidiaries. The 2025 Notes contain customary optional redemption and par call provisions. The 2025 Notes also contain a change of control provision which requires the Company to make an offer to purchase all or any part of the 2025 Notes at a purchase price of 101% of the principal amount plus accrued and unpaid interest. The capitalized deferred financing fees are amortized in Interest expense - net over the term of the 2025 Notes. The 2025 Notes are subject to customary non-financial covenants.

Note 9. RETIREMENT BENEFITS PLANS

The components of retirement benefits expense (income) are as follows:

			United States pension benefit expense																		Non-United States pension benefit expense																		Other postretirement benefits expense
			Three months ended June 30
(In millions)			2025						2024												2025						2024												2025						2024
Service cost			$	4					$	5											$	11					$	11											$	—					$	—
Interest cost			34						34												23						22												3						3
Expected return on plan assets			(47)						(48)												(33)						(33)												—						—
Amortization			3						3												4						2												(3)						(3)
			(6)						(6)												5						2												—						—
Settlements			9						10												3						2												—						—
Total expense			$	3					$	4											$	8					$	4											$	—					$	—
			United States pension benefit expense												Non-United States pension benefit expense												Other postretirement benefits expense (income)
			Six months ended June 30
(In millions)			2025						2024												2025						2024												2025						2024
Service cost			$	8					$	9											$	22					$	23											$	—					$	—
Interest cost			68						67												44						43												5						5
Expected return on plan assets			(95)						(95)												(64)						(66)												—						—
Amortization			7						5												8						5												(6)						(6)
			(12)						(14)												10						5												(1)						(1)
Settlements			18						19												5						3												—						—
Total expense (income)			$	6					$	5											$	15					$	8											$	(1)					$	(1)

The components of retirement benefits expense (income) other than service costs are included in Other income - net.

During 2020, the Company announced it was freezing its United States pension plans for its non-union employees. The freeze was effective January 1, 2021 for non-union U.S. employees whose retirement benefit was determined under a cash balance formula and is effective January 1, 2026 for non-union U.S. employees whose retirement benefit is determined under a final average pay formula.

Note 10. LEGAL CONTINGENCIES

Eaton is subject to a broad range of claims, administrative proceedings, and legal proceedings, including, but not limited to, claims for punitive damages, penalties, and interest, in a variety of matters, including, but not limited to, contract, indemnity, tax, patent infringement, intellectual property, personal injury, commercial, warranty, product liability, environmental, antitrust and trade regulation, class action, and labor and employment matters. Eaton is also subject to legal claims from historic products which may have contained asbestos. Insurance may cover some of the costs associated with claims and proceedings involving Eaton. Although it is not possible to predict with certainty the outcome or cost of these matters, the Company believes they will not have a material adverse effect on the condensed consolidated financial statements.

Note 11. INCOME TAXES

The effective income tax rate for the second quarter of 2025 was expense of 17.2% compared to expense of 16.8% for the second quarter of 2024. The effective income tax rate for the first six months of 2025 was expense of 17.6% compared to expense of 17.3% for the first six months of 2024. The increase in the effective tax rate in the second quarter and first six months of 2025 was primarily due to greater levels of income in higher tax jurisdictions.

Brazil Tax Years 2005-2012

The Company has two Brazilian tax cases primarily relating to the amortization of certain goodwill generated from the acquisition of third-party businesses and corporate reorganizations. One case involves tax years 2005-2008 (Case 1), and the other involves tax years 2009-2012 (Case 2). Case 2 is proceeding on a more accelerated timeline than Case 1. For Case 2, the Company received a tax assessment in 2014 that included interest and penalties. In November 2019, the Company received an unfavorable result at the final tax administrative appeals level, resulting in an alleged tax deficiency of $24 million plus $116 million of interest and penalties (translated at the June 30, 2025 exchange rate). The Company is challenging this assessment in the judicial system and, on April 18, 2022, received an unfavorable decision at the first judicial level. On April 27, 2022, the Company filed a motion for clarification relating to that decision. On May 20, 2022, the court largely upheld its prior decision without further clarification. On June 9, 2022, the Company filed its notice of appeal to the second level court. On July 11, 2024, the court published a favorable decision resulting in the cancellation of a portion of the penalties imposed by the tax authorities. As a result of the favorable decision, the alleged interest and penalties was reduced from $116 million to $83 million (translated at the June 30, 2025 exchange rate). The Company intends to continue its challenge of the assessment in the judicial system.

As previously disclosed for Case 1, the Company received a separate tax assessment alleging a tax deficiency of $30 million plus $116 million of interest and penalties (translated at the June 30, 2025 exchange rate), which the Company is challenging in the judicial system. On April 4, 2024, the court published a favorable decision resulting in a reduction to the Case 1 assessment for the goodwill generated from the acquisition of a third-party business. In the same decision, the court confirmed the cancellation of a portion of the penalties imposed by the tax authorities. In May 2025, Eaton obtained a favorable decision that cancelled a portion of the assessment due to the expiration of the statute of limitations. As a result of the favorable decisions, the alleged tax deficiency was reduced to $22 million plus $60 million of interest and penalties (translated at the June 30, 2025 exchange rate). The remainder of Case 1 is still pending resolution at the first judicial level.

Both cases are expected to take several years to resolve through the Brazilian judicial system and require provision of certain assets as security for the alleged deficiencies. As of June 30, 2025, the Company pledged Brazilian real estate assets with net book value of $17 million and provided additional security in the form of bank secured bonds and insurance bonds totaling $91 million and a cash deposit of $22 million (translated at the June 30, 2025 exchange rate).

Note 12. EATON SHAREHOLDERS' EQUITY

The changes in Shareholders’ equity are as follows:

			Ordinary shares												Capital in excess of par value						Retained earnings						Accumulated other comprehensive loss						Shares held in trust						Total Eaton shareholders' equity						Noncontrolling interests						Total equity
(In millions)			Shares						Dollars
Balance at January 1, 2025			392.9						$	4					$	12,731					$	10,096					$	(4,342)					$	(1)					$	18,488					$	43					$	18,531
Net income			—						—						—						964						—						—						964						1						965
Other comprehensive income, net of tax																											92												92												92
Cash dividends paid and accrued			—						—						—						(411)						—						—						(411)						(2)						(413)
Issuance of shares under equity-based compensation plans			0.4						—						(19)						—						—						—						(19)						—						(19)
Changes in noncontrolling interest of consolidated subsidiaries - net			—						—						—						—						—						—						—						(1)						(1)
Repurchase of shares			(1.9)						—						—						(608)						—						—						(608)						—						(608)
Balance at March 31, 2025			391.3						4						12,711						10,041						(4,250)						(1)						18,506						41						18,547
Net income			—						—						—						982						—						—						982						1						982
Other comprehensive income, net of tax																											155												155												155
Cash dividends paid			—						—						—						(407)						—						—						(407)						—						(407)
Issuance of shares under equity-based compensation plans			0.2						—						69						(1)						—						—						68						—						68
Changes in noncontrolling interest of consolidated subsidiaries - net			—						—						—						—						—						—						—						(1)						(1)
Repurchase of shares			(2.3)						—						—						(698)						—						—						(698)						—						(698)
Balance at June 30, 2025			389.3						$	4					$	12,780					$	9,917					$	(4,095)					$	—					$	18,606					$	41					$	18,647

			Ordinary shares												Capital in excess of par value						Retained earnings						Accumulated other comprehensive loss						Shares held in trust						Total Eaton shareholders' equity						Noncontrolling interests						Total equity
(In millions)			Shares						Dollars
Balance at January 1, 2024			399.4						$	4					$	12,634					$	10,305					$	(3,906)					$	(1)					$	19,036					$	33					$	19,069
Net income			—						—						—						821						—						—						821						1						822
Other comprehensive loss, net of tax																											(40)												(40)						—						(40)
Cash dividends paid and accrued			—						—						—						(381)						—						—						(381)						—						(381)
Issuance of shares under equity-based compensation plans			0.9						—						(4)						(1)						—						—						(5)						—						(5)
Repurchase of shares			(0.5)						—						—						(138)						—						—						(138)						—						(138)
Balance at March 31, 2024			399.8						4						12,630						10,605						(3,946)						(1)						19,292						34						19,326
Net income			—						—						—						993						—						—						993						1						994
Other comprehensive loss, net of tax																											(122)												(122)												(122)
Cash dividends paid			—						—						—						(375)						—						—						(375)						—						(375)
Issuance of shares under equity-based compensation plans			0.1						—						31						—						—						—						31						—						31
Repurchase of shares			(1.9)						—						—						(600)						—						—						(600)						—						(600)
Balance at June 30, 2024			398.1						$	4					$	12,662					$	10,622					$	(4,069)					$	(1)					$	19,219					$	35					$	19,254

On February 23, 2022, the Board of Directors adopted a share repurchase program for repurchases of ordinary shares up to $5.0 billion to be made during the three-year period commencing on that date (2022 Program). On February 27, 2025, the Board of Directors renewed the 2022 Program by providing authority for up to $9.0 billion in repurchases to be made during the three-year period commencing on that date (2025 Program). Under the 2025 Program, the ordinary shares are expected to be repurchased over time, depending on market conditions, the market price of ordinary shares, capital levels, and other considerations. During the three and six months ended June 30, 2025, 2.3 million and 4.2 million ordinary shares, respectively, were repurchased under the 2025 or 2022 Programs in the open market at a total cost of $698 million and $1,306 million, respectively. During the three and six months ended June 30, 2024, 1.9 million and 2.3 million ordinary shares, respectively, were repurchased under the 2022 program in the open market at a total cost of $600 million and $738 million, respectively.

The changes in Accumulated other comprehensive loss are as follows:

(In millions)			Currency translation and related hedging instruments						Pensions and other postretirement benefits						Cash flow hedges						Total
Balance at January 1, 2025			$	(3,399)					$	(1,044)					$	101					$	(4,342)
Other comprehensive income (loss) before reclassifications			269						(52)						11						228
Amounts reclassified from Accumulated other comprehensive loss (income)			(6)						28						(3)						19
Net current-period Other comprehensive income (loss)			263						(24)						8						247
Balance at June 30, 2025			$	(3,136)					$	(1,068)					$	109					$	(4,095)

The reclassifications out of Accumulated other comprehensive loss are as follows:

(In millions)						Six months ended June 30, 2025						Consolidated Statements of Income classification
Gains and (losses) on net investment hedges (amount excluded from effectiveness testing)
Currency exchange contracts						$	6					Interest expense - net
Tax expense						—
Total, net of tax						6
Amortization of defined benefits pensions and other postretirement benefits items
Actuarial loss and prior service cost						(32)			1
Tax benefit						4
Total, net of tax						(28)
Gains and (losses) on cash flow hedges
Floating-to-fixed interest rate swaps						7						Interest expense - net
Currency exchange contracts						(3)						Net sales and Cost of products sold
Tax expense						(1)
Total, net of tax						3
Total reclassifications for the period						$	(19)

1 These components of Accumulated other comprehensive loss are included in the computation of net periodic benefit cost. See Note 9 for additional information about pension and other postretirement benefits items.

Net Income Per Share Attributable to Eaton Ordinary Shareholders

A summary of the calculation of net income per share attributable to Eaton ordinary shareholders is as follows:

			Three months ended June 30												Six months ended June 30
(In millions except for per share data)			2025						2024						2025						2024
Net income attributable to Eaton ordinary shareholders			$	982					$	993					$	1,945					$	1,814
Weighted-average number of ordinary shares outstanding - diluted			391.4						401.0						392.5						401.5
Less dilutive effect of equity-based compensation			1.1						1.8						1.3						1.9
Weighted-average number of ordinary shares outstanding - basic			390.3						399.2						391.2						399.6
Net income per share attributable to Eaton ordinary shareholders
Diluted			$	2.51					$	2.48					$	4.96					$	4.52
Basic			2.52						2.49						4.97						4.54

For the second quarter and first six months of 2025, 0.1 million stock options were excluded from the calculation of diluted net income per share attributable to Eaton ordinary shareholders because the exercise price of the options exceeded the average market price of the ordinary shares during the period and their effect, accordingly, would have been antidilutive. For the second quarter and first six months of 2024, all stock options were included in the calculation of diluted net income per share attributable to Eaton ordinary shareholders because they were all dilutive.

Note 13. FAIR VALUE MEASUREMENTS

Fair value is measured based on an exit price, representing the amount that would be received to sell an asset or paid to satisfy a liability in an orderly transaction between market participants. Fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a fair value hierarchy is established, which categorizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

A summary of financial instruments recognized at fair value, and the fair value measurements used, is as follows:

(In millions)			Total						Quoted prices in active markets for identical assets (Level 1)						Other observable inputs (Level 2)						Unobservable inputs (Level 3)
June 30, 2025
Cash			$	398					$	398					$	—					$	—
Short-term investments			186						186						—						—
Net derivative contracts			(37)						—						(37)						—
December 31, 2024
Cash			$	555					$	555					$	—					$	—
Short-term investments			1,525						1,525						—						—
Net derivative contracts			(16)						—						(16)						—

Eaton values its financial instruments using an industry standard market approach, in which prices and other relevant information is generated by market transactions involving identical or comparable assets or liabilities.

Other Fair Value Measurements

Long-term debt and the current portion of long-term debt had a carrying value of $9,885 million and fair value of $9,516 million at June 30, 2025 compared to $9,152 million and $8,651 million, respectively, at December 31, 2024. The fair value of Eaton's debt instruments was estimated using prevailing market interest rates on debt with similar creditworthiness, terms and maturities and is considered a Level 2 fair value measurement.

Note 14. DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

In the normal course of business, Eaton is exposed to certain risks related to fluctuations in interest rates, currency exchange rates and commodity prices. The Company uses various derivative and non-derivative financial instruments, primarily interest rate swaps, currency forward exchange contracts, currency swaps and commodity contracts to manage risks from these market fluctuations. The instruments used by Eaton are straightforward, non-leveraged instruments. The counterparties to these instruments are financial institutions with strong credit ratings. Eaton maintains control over the size of positions entered into with any one counterparty and regularly monitors the credit rating of these institutions. Such instruments are not purchased and sold for trading purposes.

Derivative financial instruments are accounted for at fair value and recognized as assets or liabilities in the Consolidated Balance Sheets. Accounting for the gain or loss resulting from the change in the fair value of the derivative financial instrument depends on whether it has been designated as part of a hedging relationship, is effective and the nature of the hedging activity. Eaton formally documents all relationships between derivative financial instruments accounted for as designated hedges and the hedged item, as well as its risk-management objective and strategy for undertaking the hedge transaction. This process includes linking derivative financial instruments to a recognized asset or liability, specific firm commitment, forecasted transaction, or net investment in a foreign operation. These financial instruments can be designated as:

• Hedges of the change in the fair value of a recognized fixed-rate asset or liability, or the firm commitment to acquire such an asset or liability (a fair value hedge); for these hedges, the gain or loss from the derivative financial instrument, as well as the offsetting loss or gain on the hedged item attributable to the hedged risk, are recognized in income during the period of change in fair value.

• Hedges of the variable cash flows of a recognized variable-rate asset or liability, or the forecasted acquisition of such an asset or liability (a cash flow hedge); for these hedges, the gain or loss from the derivative financial instrument is recognized in Accumulated other comprehensive income and reclassified to income in the same period when the gain or loss on the hedged item is included in income.

• Hedges of the currency exposure related to a net investment in a foreign operation (a net investment hedge); for these hedges, the gain or loss from the derivative financial instrument is recognized in Accumulated other comprehensive income and reclassified to income in the same period when the gain or loss related to the net investment in the foreign operation is included in income.

The gain or loss from a derivative financial instrument designated as a hedge is classified in the same line of the Consolidated Statements of Income as the offsetting loss or gain on the hedged item. The cash flows resulting from these financial instruments are classified in operating activities on the Condensed Consolidated Statements of Cash Flows.

For derivatives that are not designated as a hedge, any gain or loss is immediately recognized in income. The majority of derivatives used in this manner relate to risks resulting from assets or liabilities denominated in a foreign currency and certain commodity contracts that arise in the normal course of business.

Eaton uses currency exchange contracts, cross-currency interest rate swaps, and certain of its debt denominated in foreign currency to hedge portions of its net investments in foreign operations against foreign currency exposure (net investment hedges). The Company uses the spot rate method to assess hedge effectiveness when derivative financial instruments are used in net investment hedges. Under this method, changes in the fair value of currency exchange contracts attributable to changes in the spot exchange rate and changes in the fair value of cross-currency interest rate swaps are recognized in Accumulated other comprehensive loss. Changes related to the forward rate of currency exchange contracts are excluded from the hedging relationship and the forward points are amortized to Interest expense - net on a straight-line basis over the term of the contract. Interest accruals on cross-currency interest rate swaps are excluded from the hedging relationship and recognized in Interest expense - net. The cash flows resulting from currency exchange contracts and cross-currency interest rate swaps are classified in investing activities on the Condensed Consolidated Statements of Cash Flows.

Derivative Financial Statement Impacts

The fair value of derivative financial instruments recognized in the Consolidated Balance Sheets is as follows:

(In millions)			Notional amount						Other current assets						Other noncurrent assets						Other current liabilities						Other noncurrent liabilities						Type of hedge						Term
June 30, 2025
Derivatives designated as hedges
Currency exchange contracts			$	435					$	17					$	—					$	8					$	—					Cash flow						1 to 11 months
Commodity contracts			5						—						—						—						—						Cash flow						1 to 12 months
Currency exchange contracts			656						—						—						—						—						Net investment						3 months
Cross-currency interest rate swaps			523						—						—						—						51						Net investment						5 years
Total									$	18					$	—					$	8					$	51
Derivatives not designated as hedges
Currency exchange contracts			$	3,966					$	13											$	9																	1 to 7 months
December 31, 2024
Derivatives designated as hedges
Forward starting floating-to-fixed interest rate swaps			$	156					$	—					$	—					$	—					$	1					Cash flow						11 years
Currency exchange contracts			499						12						—						14						—						Cash flow						1 to 13 months
Commodity contracts			4						—						—						—						—						Cash flow						1 to 11 months
Currency exchange contracts			545						3						—						—						—						Net investment						3 months
Total									$	15					$	—					$	14					$	1
Derivatives not designated as hedges
Currency exchange contracts			$	4,945					$	13											$	29																	1 to 7 months

The currency exchange contracts shown in the table above as derivatives not designated as hedges are primarily contracts entered into to manage currency volatility or exposure on intercompany receivables, payables and loans. While Eaton does not elect hedge accounting treatment for these derivatives, Eaton targets managing 95% to 100% of the intercompany balance sheet exposure to minimize the effect of currency volatility related to the movement of goods and services in the normal course of its operations. This activity represents the great majority of these currency exchange contracts. The cash flows resulting from the settlement of these derivatives have been classified in investing activities in the Condensed Consolidated Statements of Cash Flows.

Foreign currency denominated debt designated as non-derivative net investment hedging instruments had a carrying value on an after-tax basis of $3,988 million at June 30, 2025 and $3,105 million at December 31, 2024.

As of June 30, 2025, the volume of outstanding commodity contracts that were entered into to hedge forecasted transactions:

Commodity						June 30, 2025												Term
Copper						1						Millions of pounds						1 to 12 months

The following amounts were recorded on the Consolidated Balance Sheets related to fixed-to-floating interest rate swaps:

(In millions)			Carrying amount of the hedged assets (liabilities)												Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged asset (liabilities)1
Location on Consolidated Balance Sheets			June 30, 2025									December 31, 2024						June 30, 2025						December 31, 2024
Long-term debt			$	(502)								$	(647)					$	(34)					$	(37)

1 At June 30, 2025 and December 31, 2024, these amounts include the cumulative liability amount of fair value hedging adjustments remaining for which the hedge accounting has been discontinued of $34 million and $37 million, respectively.

The impact of hedging activities to the Consolidated Statements of Income is as follows:

			Three months ended June 30, 2025
(In millions)			Net Sales						Cost of products sold						Interest expense - net
Amounts from Consolidated Statements of Income			$	7,028					$	4,431					$	71
Gain (loss) on derivatives designated as cash flow hedges
Forward starting floating-to-fixed interest rate swaps
Hedged item			$	—					$	—					$	(3)
Derivative designated as hedging instrument			—						—						3
Currency exchange contracts
Hedged item			$	(1)					$	(4)					$	—
Derivative designated as hedging instrument			1						4						—
Gain (loss) on derivatives designated as net investment hedges
Cross-currency interest rate swaps
Initial value of component excluded from effectiveness testing amortized to earnings			$	—					$	—					$	2

			Three months ended June 30, 2024
(In millions)			Net Sales						Cost of products sold						Interest expense - net
Amounts from Consolidated Statements of Income			$	6,350					$	3,940					$	29
Gain (loss) on derivatives designated as cash flow hedges
Forward starting floating-to-fixed interest rate swaps
Hedged item			$	—					$	—					$	(3)
Derivative designated as hedging instrument			—						—						3
Currency exchange contracts
Hedged item			$	2					$	(4)					$	—
Derivative designated as hedging instrument			(2)						4						—
Commodity contracts
Hedged item			$	—					$	(1)					$	—
Derivative designated as hedging instrument			—						1						—

			Six months ended June 30, 2025
(In millions)			Net Sales						Cost of products sold						Interest expense - net
Amounts from Consolidated Statements of Income			$	13,404					$	8,361					$	103
Gain (loss) on derivatives designated as cash flow hedges
Forward starting floating-to-fixed interest rate swaps
Hedged item			$	—					$	—					$	(7)
Derivative designated as hedging instrument			—						—						7
Currency exchange contracts
Hedged item			$	2					$	1					$	—
Derivative designated as hedging instrument			(2)						(1)						—
Gain (loss) on derivatives designated as net investment hedges
Cross-currency interest rate swaps
Initial value of component excluded from effectiveness testing amortized to earnings			$	—					$	—					$	3

			Six months ended June 30, 2024
(In millions)			Net Sales						Cost of products sold						Interest expense - net
Amounts from Consolidated Statements of Income			$	12,293					$	7,665					$	59
Gain (loss) on derivatives designated as cash flow hedges
Forward starting floating-to-fixed interest rate swaps
Hedged item			$	—					$	—					$	(6)
Derivative designated as hedging instrument			—						—						6
Currency exchange contracts
Hedged item			$	—					$	(12)					$	—
Derivative designated as hedging instrument			—						12						—

The impact of derivatives not designated as hedges to the Consolidated Statements of Income is as follows:

			Gain (loss) recognized in Consolidated Statements of Income												Consolidated Statements of Income classification
			Three months ended June 30
(In millions)			2025						2024
Gain (loss) on derivatives not designated as hedges
Currency exchange contracts			$	(16)					$	(29)					Interest expense - net
Total			$	(16)					$	(29)

			Gain (loss) recognized in Consolidated Statements of Income												Consolidated Statements of Income classification
			Six months ended June 30
(In millions)			2025						2024
Gain (loss) on derivatives not designated as hedges
Currency exchange contracts			$	3					$	(9)					Interest expense - net
Total			$	3					$	(9)

The impact of derivative and non-derivative instruments designated as hedges to the Consolidated Statements of Income and Comprehensive Income is as follows:

			Gain (loss) recognized in other comprehensive income (loss)												Location of gain (loss) reclassified from Accumulated other comprehensive loss						Gain (loss) reclassified from Accumulated other comprehensive loss
			Three months ended June 30																		Three months ended June 30
(In millions)			2025						2024												2025						2024
Derivatives designated as cash flow hedges
Forward starting floating-to-fixed interest rate swaps			$	(1)					$	4					Interest expense - net						$	3					$	3
Currency exchange contracts			6						(12)						Net sales and Cost of products sold						5						3
Commodity contracts			—						3						Cost of products sold						—						1
Derivatives designated as net investment hedges
Currency exchange contracts
Effective portion			(9)						5						Gain (loss) on sale of business						—						—
Amount excluded from effectiveness testing			4						—						Interest expense - net						4						3
Cross-currency interest rate swaps
Effective portion			(45)						—						Gain (loss) on sale of business						—						—
Amount excluded from effectiveness testing not amortized to earnings			3						—						Gain (loss) on sale of business						—						—
Non-derivative designated as net investment hedges
Foreign currency denominated debt			(272)						26						Gain (loss) on sale of business						—						—
Total			$	(314)					$	26											$	12					$	10

			Gain (loss) recognized in other comprehensive income (loss)												Location of gain (loss) reclassified from Accumulated other comprehensive loss						Gain (loss) reclassified from Accumulated other comprehensive loss
			Six months ended June 30																		Six months ended June 30
(In millions)			2025						2024												2025						2024
Derivatives designated as cash flow hedges
Forward starting floating-to-fixed interest rate swaps			$	3					$	6					Interest expense - net						$	7					$	6
Currency exchange contracts			10						(10)						Net sales and Cost of products sold						(3)						11
Commodity contracts			1						4						Cost of products sold						—						—
Derivatives designated as net investment hedges
Currency exchange contracts
Effective portion			(16)						16						Gain (loss) on sale of business						—						—
Amount excluded from effectiveness testing			5						3						Interest expense - net						6						7
Cross-currency interest rate swaps
Effective portion			(62)						—						Gain (loss) on sale of business						—						—
Amount excluded from effectiveness testing not amortized to earnings			11						—						Gain (loss) on sale of business						—						—
Non-derivative designated as net investment hedges
Foreign currency denominated debt			(394)						98						Gain (loss) on sale of business						—						—
Total			$	(442)					$	118											$	10					$	25

The pre-tax gain (loss) on derivative financial instruments designated as net investment hedges included in Accumulated other comprehensive loss is as follows:

			Gain (loss) included in Accumulated other comprehensive loss
(In millions)			June 30, 2025						December 31, 2024
Effective portion
Currency exchange contracts			$	11					$	27
Cross-currency interest rate swaps			(62)						—
Amount excluded from effectiveness testing
Currency exchange contracts			$	—					$	1
Cross-currency interest rate swaps			11						—

At June 30, 2025, a gain of $12 million of estimated unrealized net gains or losses associated with our cash flow hedges were expected to be reclassified to income from Accumulated other comprehensive loss within the next twelve months. These reclassifications relate to our designated foreign currency and commodity hedges that will mature in the next twelve months.

Note 15. RESTRUCTURING CHARGES

During the first quarter of 2024, Eaton implemented a multi-year restructuring program to accelerate opportunities to optimize its operations and global support structure. These actions will better align the Company's functions to support anticipated growth and drive greater effectiveness throughout the Company. Since the inception of the program, the Company has incurred charges of $244 million. This restructuring program is expected to be completed in 2026 and is expected to incur additional expenses related to workforce reductions of $164 million and plant closing and other costs of $67 million, resulting in total estimated charges of $475 million for the entire program.

A summary of restructuring program charges is as follows:

			Three months ended June 30												Six months ended June 30
(In millions except for per share data)			2025						2024						2025						2024
Workforce reductions			$	7					$	9					$	19					$	68
Plant closing and other			17						7						23						11
Total before income taxes			24						15						42						78
Income tax benefit			5						3						9						18
Total after income taxes			$	18					$	12					$	33					$	61
Per ordinary share - diluted			$	0.05					$	0.03					$	0.08					$	0.15

Restructuring program charges related to the following segments:

			Three months ended June 30												Six months ended June 30												Restructuring program charges incurred from inception through
(In millions)			2025						2024						2025						2024						June 30, 2025
Electrical Americas			$	9					$	1					$	10					$	8					$	22
Electrical Global			5						4						19						27						106
Aerospace			—						—						—						8						9
Vehicle			2						4						4						27						43
eMobility			2						—						2						—						27
Corporate			6						7						7						7						36
Total			$	24					$	15					$	42					$	78					$	244

A summary of liabilities related to workforce reductions, plant closing, and other associated costs is as follows:

(In millions)			Workforce reductions						Plant closing and other						Total
Balance at January 1, 2024			$	35					$	6					$	41
Liability recognized, net			120						83						202
Payments, utilization and translation			(59)						(81)						(141)
Balance at December 31, 2024			96						7						103
Liability recognized, net			19						23						42
Payments, utilization and translation			(27)						(23)						(50)
Balance at June 30, 2025			$	88					$	7					$	94

These restructuring program charges were included in Cost of products sold, Selling and administrative expense, Research and development expense, or Other income - net, as appropriate. In Business Segment Information, these restructuring program charges are treated as Corporate items. See Note 16 for additional information about business segments.

Note 16. BUSINESS SEGMENT INFORMATION

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated on a regular basis by the chief operating decision maker, or decision making group, in deciding how to allocate resources to an individual segment and in assessing performance. The Company's chief operating decision maker is the chief executive officer. Eaton's operating segments are Electrical Americas, Electrical Global, Aerospace, Vehicle, and eMobility. Operating profit (loss) includes the operating profit from intersegment sales. For additional information regarding Eaton's business segments, see Note 19 to the consolidated financial statements contained in the 2024 Form 10-K.

The chief operating decision maker uses segment operating profit (loss) as an input to assess segment performance and determine appropriate resource allocations, including capital, financial, and employee resources. Segment operating profit (loss) results are regularly evaluated versus annual profit plan, forecast and/or prior year.

Other segment items are primarily comprised of Cost of products sold, Selling and administrative expense, Research and development expense, depreciation of property, plant and equipment, and certain items included in Other income – net on the Consolidated Statements of Income. The Company's chief operating decision maker manages these items on a consolidated basis.

Business Segment Information

			Three months ended June 30												Six months ended June 30
(In millions)			2025						2024						2025						2024
Net sales
Electrical Americas			$	3,350					$	2,877					$	6,360					$	5,567
Electrical Global			1,753						1,606						3,362						3,105
Aerospace			1,080						955						2,059						1,826
Vehicle			663						723						1,280						1,447
eMobility			182						189						343						348
Total net sales			$	7,028					$	6,350					$	13,404					$	12,293
Other segment items
Electrical Americas			$	2,363					$	2,018					$	4,469					$	3,923
Electrical Global			1,400						1,301						2,709						2,527
Aerospace			840						749						1,593						1,419
Vehicle			550						593						1,071						1,201
eMobility			192						187						358						350
Total other segment items			$	5,346					$	4,848					$	10,200					$	9,420
Segment operating profit (loss)
Electrical Americas			$	987					$	859					$	1,891					$	1,644
Electrical Global			353						305						653						578
Aerospace			240						206						466						407
Vehicle			113						130						209						246
eMobility			(10)						2						(15)						(2)
Total segment operating profit			1,682						1,502						3,204						2,873
Corporate
Intangible asset amortization expense			(129)						(106)						(235)						(212)
Interest expense - net			(71)						(29)						(103)						(59)
Pension and other postretirement benefits income			5						9						10						20
Restructuring program charges			(24)						(15)						(42)						(78)
Other expense - net			(277)						(166)						(471)						(349)
Income before income taxes			1,186						1,195						2,363						2,195
Income tax expense			203						201						415						379
Net income			982						994						1,947						1,816
Less net income for noncontrolling interests			(1)						(1)						(2)						(2)
Net income attributable to Eaton ordinary shareholders			$	982					$	993					$	1,945					$	1,814

(In millions)			June 30, 2025						December 31, 2024
Identifiable assets
Electrical Americas			$	5,783					$	4,933
Electrical Global			3,637						3,233
Aerospace			2,592						2,392
Vehicle			2,101						1,987
eMobility			727						633
Total identifiable assets			14,840						13,178
Goodwill			15,790						14,713
Other intangible assets			5,227						4,658
Corporate			4,650						5,833
Total assets			$	40,507					$	38,381

			Three months ended June 30												Six months ended June 30
(In millions)			2025						2024						2025						2024
Capital expenditures for property, plant and equipment
Electrical Americas			$	98					$	72					$	155					$	164
Electrical Global			49						37						89						67
Aerospace			22						20						39						34
Vehicle			18						26						30						45
eMobility			5						21						14						40
Total			191						176						327						350
Corporate			11						11						22						20
Total expenditures for property, plant and equipment			$	202					$	187					$	349					$	370
			Three months ended June 30												Six months ended June 30
(In millions)			2025						2024						2025						2024
Depreciation of property, plant and equipment
Electrical Americas			$	33					$	29					$	64					$	57
Electrical Global			27						25						53						49
Aerospace			18						17						36						34
Vehicle			24						24						48						47
eMobility			8						6						15						12
Total			111						100						216						198
Corporate			9						9						19						18
Total depreciation of property, plant and equipment			$	121					$	109					$	236					$	216