Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management of Pentair plc and its subsidiaries (the “Company”) is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934. The Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. The Company’s internal control over financial reporting includes those policies and procedures that (1) pertain to maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of the financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of the effectiveness of internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025. In making this assessment, management used the criteria for effective internal control over financial reporting described in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management believes that, as of December 31, 2025, the Company’s internal control over financial reporting was effective based on those criteria.

Our independent registered public accounting firm, Deloitte & Touche LLP, has issued an attestation report on the Company’s internal control over financial reporting as of December 31, 2025. That attestation report is set forth immediately following this management report.

John L. Stauch						Robert P. Fishman
President and Chief Executive Officer						Executive Vice President and Chief Financial Officer

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of Pentair plc

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Pentair plc and subsidiaries (the “Company”) as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2025, of the Company and our report dated February 24, 2026, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte & Touche LLP

Minneapolis, Minnesota

February 24, 2026

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of Pentair plc

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Pentair plc and subsidiaries (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive income, cash flows and changes in equity, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 24, 2026, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Goodwill – Impairment Assessment — Refer to Notes 1 and 5 to the financial statements

Critical Audit Matter Description

As described in Notes 1 and 5 to the consolidated financial statements, the Company's consolidated goodwill balance was $3,538.1 million as of December 31, 2025. Management performs a goodwill impairment test annually in the fourth quarter, or more frequently if events or circumstances indicate that goodwill may be impaired. Management compares the fair value of the reporting units to the carrying value of the reporting units for goodwill impairment testing. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized to the extent that a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill in that reporting unit. In 2025, management performed a qualitative assessment to determine whether it is more likely than not that the fair value of each reporting unit exceeds its carrying value. As disclosed by management, the qualitative analysis considered the results of the most recent discounted cash flow fair value assessment of the reporting units and the calculated excess fair value over carrying amount, financial performance, forecasts and trends, market capitalization, regulatory and environmental issues, macro-economic conditions, industry and market considerations, raw material costs and management stability. After completing the qualitative assessment, the Company determined that it was more likely than not that the fair value of the reporting units exceeded their respective carrying values; therefore, no quantitative assessment was required.

The principal consideration for our determination that performing procedures relating to the goodwill impairment test for a reporting unit with a carrying value of $1,052.1 million within the Water Solutions reportable segment as a critical audit matter is due to: i) a high degree of auditor judgment, subjectivity, and effort in performing procedures to assess management's significant assumptions related to evaluation of potential triggering events within the reporting unit that could have a significant effect on the Company's qualitative assessment; ii) the determination of whether further quantitative analysis of goodwill impairment was required; and iii) the audit effort that involved the use of professionals with specialized skill and knowledge.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to evaluating the Company's qualitative goodwill impairment assessment for the reporting unit included the following, among others:

• Evaluated the design and implementation and tested the operating effectiveness of certain internal controls related to the evaluation of goodwill impairment. This included a control related to the Company's assessment of potential goodwill triggering events.

• Considered macroeconomic conditions, including tariffs, gross domestic product and inflation by key regions around the world for negative indicators.

• Evaluated information from analyst reports in the water and manufacturing industries, which were compared to industry and market considerations used by the Company.

• Analyzed information including the financial performance of the reporting unit, the Company's market capitalization, and other entity and reporting-unit specific events.

• With the assistance of our fair value specialists, we assessed the appropriateness and mathematical accuracy of the discount rate (i.e., weighted average cost of capital (“WACC”)) calculations for the reporting unit.

/s/ Deloitte & Touche LLP

Minneapolis, Minnesota

February 24, 2026

We have served as the Company’s auditor since 1977.

Pentair plc and Subsidiaries

Consolidated Statements of Operations and Comprehensive Income

			Years ended December 31
In millions, except per-share data			2025			2024			2023
Net sales			$	4,176.0		$	4,082.8		$	4,104.5
Cost of goods sold			2,485.7			2,484.0			2,585.3
Gross profit			1,690.3			1,598.8			1,519.2
Selling, general and administrative			736.9			701.4			680.2
Research and development			95.9			93.6			99.8
Operating income			857.5			803.8			739.2
Other expense (income)
Loss on sale of business			26.3			—			—
Net interest expense			69.4			88.6			118.3
Other expense (income)			5.3			(3.7)			2.0
Income from continuing operations before income taxes			756.5			718.9			618.9
Provision (benefit) for income taxes			107.0			93.3			(4.0)
Net income from continuing operations			649.5			625.6			622.9
Income (loss) from discontinued operations, net of tax			4.3			(0.2)			(0.2)
Net income			$	653.8		$	625.4		$	622.7
Comprehensive income, net of tax
Net income			$	653.8		$	625.4		$	622.7
Changes in cumulative translation adjustment			93.3			(65.8)			24.0
Changes in market value of derivative financial instruments, net of tax			(84.9)			33.6			(29.4)
Comprehensive income			$	662.2		$	593.2		$	617.3
Earnings per ordinary share
Basic
Continuing operations			$	3.96		$	3.78		$	3.77
Discontinued operations			0.03			—			—
Basic earnings per ordinary share			$	3.99		$	3.78		$	3.77
Diluted
Continuing operations			$	3.93		$	3.74		$	3.75
Discontinued operations			0.03			—			—
Diluted earnings per ordinary share			$	3.96		$	3.74		$	3.75
Weighted average ordinary shares outstanding
Basic			164.1			165.6			165.1
Diluted			165.5			167.1			166.3

See accompanying notes to consolidated financial statements.

Pentair plc and Subsidiaries

Consolidated Balance Sheets

			December 31
In millions, except per-share data			2025			2024
Assets
Current assets
Cash and cash equivalents			$	101.6		$	118.7
Accounts receivable, net of allowances of $6.8 and $9.1, respectively			673.2			565.2
Inventories			632.6			610.9
Other current assets			134.4			141.3
Total current assets			1,541.8			1,436.1
Property, plant and equipment, net			376.8			358.8
Other assets
Goodwill			3,538.1			3,286.6
Intangibles, net			1,073.3			1,033.8
Other non-current assets			338.8			331.2
Total other assets			4,950.2			4,651.6
Total assets			$	6,868.8		$	6,446.5
Liabilities and Equity
Current liabilities
Current maturities of short-term borrowings			$	—		$	9.3
Accounts payable			301.5			272.8
Employee compensation and benefits			120.1			116.2
Other current liabilities			537.7			496.8
Total current liabilities			959.3			895.1
Other liabilities
Long-term debt			1,638.6			1,638.7
Pension and other post-retirement compensation and benefits			58.8			61.6
Deferred tax liabilities			47.5			44.4
Other non-current liabilities			295.4			243.8
Total liabilities			2,999.6			2,883.6
Commitments and contingencies (Note 15)
Equity
Ordinary shares $0.01 par value, 426.0 authorized, 163.2 and 164.8 issued at December 31, 2025 and 2024, respectively			1.7			1.7
Additional paid-in capital			1,313.1			1,501.7
Retained earnings			2,822.6			2,336.1
Accumulated other comprehensive loss			(268.2)			(276.6)
Total equity			3,869.2			3,562.9
Total liabilities and equity			$	6,868.8		$	6,446.5

See accompanying notes to consolidated financial statements.

Pentair plc and Subsidiaries

Consolidated Statements of Cash Flows

			Years ended December 31
In millions			2025			2024			2023
Operating activities
Net income			$	653.8		$	625.4		$	622.7
(Income) loss from discontinued operations, net of tax			(4.3)			0.2			0.2
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities of continuing operations
Equity income of unconsolidated subsidiaries			(1.0)			(1.9)			(2.8)
Depreciation			59.6			60.3			59.5
Amortization			58.1			54.3			55.3
Deferred income taxes			(4.3)			(11.4)			(92.5)
Loss on sale of business			26.3			—			—
Share-based compensation			37.0			39.7			29.1
Asset impairment and write-offs			49.1			17.6			7.9
Pension and other post-retirement expense			6.9			0.1			12.1
Pension and other post-retirement contributions			(10.6)			(12.0)			(8.7)
Gain on sale of assets			—			—			(3.4)
Changes in assets and liabilities, net of effects of business acquisitions
Accounts receivable			(93.1)			(11.2)			(24.4)
Inventories			(36.9)			53.6			109.6
Other current assets			(0.7)			14.1			(29.1)
Accounts payable			20.5			(3.7)			(75.1)
Employee compensation and benefits			(3.7)			(5.0)			17.2
Other current liabilities			26.1			(48.7)			(59.5)
Other non-current assets and liabilities			32.0			(4.5)			2.7
Net cash provided by operating activities of continuing operations			814.8			766.9			620.8
Net cash used for operating activities of discontinued operations			—			(0.2)			(1.6)
Net cash provided by operating activities			814.8			766.7			619.2
Investing activities
Capital expenditures			(68.8)			(74.4)			(76.0)
Purchase of investments			(18.0)			—			—
Proceeds from sale of property and equipment			2.4			0.6			5.6
Payments upon the settlement of net investment hedges			(28.9)			(5.8)			(18.5)
Acquisitions, net of cash acquired			(292.1)			(108.0)			(0.6)
Other			0.9			—			4.1
Net cash used for investing activities			(404.5)			(187.6)			(85.4)
Financing activities
Net (repayments) receipts of short-term borrowings			(9.3)			9.3			—
Net borrowings (repayments) of revolving long-term debt			268.2			9.5			(320.0)
Repayments of long-term debt			(269.3)			(362.5)			(12.5)
Debt issuance costs			(2.2)			—			—
Shares issued to employees, net of shares withheld			(0.6)			18.4			9.6
Repurchases of ordinary shares			(225.0)			(150.0)			—
Dividends paid			(164.3)			(152.3)			(145.2)
Payments upon the settlement of cross currency swaps			—			(9.1)			—
Net cash used for financing activities			(402.5)			(636.7)			(468.1)
Effect of exchange rate changes on cash and cash equivalents			(24.9)			6.0			(4.3)
Change in cash and cash equivalents			(17.1)			(51.6)			61.4
Cash and cash equivalents, beginning of year			118.7			170.3			108.9
Cash and cash equivalents, end of year			$	101.6		$	118.7		$	170.3
Supplemental disclosure of cash flow information:
Cash paid for interest, net			$	79.8		$	145.6		$	146.4
Cash paid for income taxes, net			86.9			121.0			120.0

See accompanying notes to consolidated financial statements.

Pentair plc and Subsidiaries

Consolidated Statements of Changes in Equity

In millions			Ordinary shares						Additional paid-in capital			Retained earnings			Accumulated other comprehensive income (loss)			Total
Number			Amount
Balance - December 31, 2022			164.5			$	1.7		$	1,554.9		$	1,390.5		$	(239.0)		$	2,708.1
Net income			—			—			—			622.7			—			622.7
Other comprehensive loss, net of tax			—			—			—			—			(5.4)			(5.4)
Dividends declared			—			—			—			(147.0)			—			(147.0)
Exercise of options, net of shares tendered for payment			0.4			—			18.3			—			—			18.3
Issuance of restricted shares, net of cancellations			0.5			—			—			—			—			—
Shares surrendered by employees to pay taxes			(0.1)			—			(8.7)			—			—			(8.7)
Share-based compensation			—			—			29.1			—			—			29.1
Balance - December 31, 2023			165.3			$	1.7		$	1,593.6		$	1,866.2		$	(244.4)		$	3,217.1
Net income			—			—			—			625.4			—			625.4
Other comprehensive loss, net of tax			—			—			—			—			(32.2)			(32.2)
Dividends declared			—			—			—			(155.5)			—			(155.5)
Share repurchases			(1.6)			—			(150.0)			—			—			(150.0)
Exercise of options, net of shares tendered for payment			0.8			—			28.8			—			—			28.8
Issuance of restricted shares, net of cancellations			0.4			—			—			—			—			—
Shares surrendered by employees to pay taxes			(0.1)			—			(10.4)			—			—			(10.4)
Share-based compensation			—			—			39.7			—			—			39.7
Balance - December 31, 2024			164.8			$	1.7		$	1,501.7		$	2,336.1		$	(276.6)		$	3,562.9
Net income			—			—			—			653.8			—			653.8
Other comprehensive income, net of tax			—			—			—			—			8.4			8.4
Dividends declared			—			—			—			(167.3)			—			(167.3)
Share repurchases			(2.3)			—			(225.0)			—			—			(225.0)
Exercise of options, net of shares tendered for payment			0.4			—			9.5			—			—			9.5
Issuance of restricted shares, net of cancellations			0.4			—			—			—			—			—
Shares surrendered by employees to pay taxes			(0.1)			—			(10.1)			—			—			(10.1)
Share-based compensation			—			—			37.0			—			—			37.0
Balance - December 31, 2025			163.2			$	1.7		$	1,313.1		$	2,822.6		$	(268.2)		$	3,869.2

See accompanying notes to consolidated financial statements.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

**1.**Basis of Presentation and Summary of Significant Accounting Policies

Business

Pentair plc and its consolidated subsidiaries (“we,” “us,” “our,” “Pentair” or the “Company”) is a water industrial manufacturing company comprised of three reportable segments: Flow, Water Solutions and Pool.

Basis of presentation

The accompanying consolidated financial statements include the accounts of Pentair plc, its wholly-owned subsidiaries and entities for which the Company has a controlling financial interest. Intercompany accounts and transactions have been eliminated. Investments in companies of which we own 20% to 50% of the voting stock or have the ability to exercise significant influence over operating and financial policies of the investee are accounted for using the equity method of accounting and as a result, our share of the earnings or losses of such equity affiliates is included in the Consolidated Statements of Operations and Comprehensive Income.

The consolidated financial statements have been prepared in U.S. dollars (“USD”) and in accordance with accounting principles generally accepted in the United States (“U.S.”) (“U.S. GAAP”).

Fiscal year

Our fiscal year ends on December 31. We report our interim quarterly periods on a calendar quarter basis.

Use of estimates

The preparation of our consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the amounts reported in these consolidated financial statements and accompanying notes, disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates include our accounting for valuation of goodwill and indefinite lived intangible assets, estimated losses on accounts receivable, estimated realizable value on excess and obsolete inventory, over time revenue recognition, assets acquired and liabilities assumed in acquisitions, estimated selling proceeds from assets held for sale, contingent liabilities, income taxes and pension and other post-retirement benefits. Actual results could differ from our estimates.

Revenue recognition

Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for transferring those goods or providing services. We account for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable.

When determining whether the customer has obtained control of the goods or services, we consider any future performance obligations. Generally, there is no post-shipment obligation on product sold other than warranty obligations in the normal and ordinary course of business. In the event significant post-shipment obligations were to exist, revenue recognition would be deferred until Pentair has substantially accomplished what it must do to be entitled to the benefits represented by the revenue.

Performance obligations

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account for purposes of revenue recognition. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The majority of our contracts have a single performance obligation as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts and, therefore, not distinct. For contracts with multiple performance obligations, standalone selling price is generally readily observable.

Our performance obligations are satisfied at a point in time or over time as work progresses. Revenue from goods and services transferred to customers at a point in time accounted for 92.4%, 91.2% and 90.6% of our revenue for the years ended December 31, 2025, 2024 and 2023, respectively. Revenue on these contracts is recognized when obligations under the terms of the contract with our customer are satisfied; generally, this occurs with the transfer of control upon shipment.

Revenue from products and services transferred to customers over time accounted for 7.6%, 8.8% and 9.4% of our revenue for the years ended December 31, 2025, 2024 and 2023, respectively. For the majority of our revenue recognized over time, we use an input measure to determine progress towards completion. Under this method, sales and gross profit are recognized as work is performed generally based on the relationship between the actual costs incurred and the total estimated costs at completion (“the cost-to-cost method”) or based on efforts for measuring progress towards completion in situations in which this approach is more representative of the progress on the contract than the cost-to-cost method. Contract costs include labor, material, overhead and, when appropriate, general and administrative expenses. Changes to the original estimates may be required during the life of the contract, and such estimates are reviewed on a regular basis. Sales and gross profit are adjusted using the

Pentair plc and Subsidiaries

Notes to consolidated financial statements

cumulative catch-up method for revisions in estimated total contract costs. These reviews have not resulted in adjustments that were significant to our results of operations. For performance obligations related to long term contracts, when estimates of total costs to be incurred on a performance obligation exceed total estimates of revenue to be earned, a provision for the entire loss on the performance obligation is recognized in the period the loss is determined.

On December 31, 2025, we had $134.0 million of remaining performance obligations on contracts with an original expected duration of one year or more. We expect to recognize the majority of our remaining performance obligations on these contracts within the next 12 to 18 months.

Sales returns

The right of return may exist explicitly or implicitly with our customers. Our return policy allows for customer returns only upon our authorization. Goods returned must be products we continue to market and must be in salable condition. When the right of return exists, we adjust the transaction price for the estimated effect of returns. We estimate the expected returns based on historical sales levels, the timing and magnitude of historical sales return levels as a percent of sales, type of product, type of customer and a projection of this experience into the future.

Pricing and sales incentives

Our contracts may give customers the option to purchase additional goods or services priced at a discount. Options to acquire additional goods or services at a discount can come in many forms, such as customer programs and incentive offerings including pricing arrangements, promotions and other volume-based incentives.

We reduce the transaction price for certain customer programs and incentive offerings including pricing arrangements, promotions and other volume-based incentives that represent variable consideration. Sales incentives given to our customers are recorded using either the expected value method or most likely amount approach for estimating the amount of consideration to which Pentair shall be entitled. The expected value is the sum of probability-weighted amounts in a range of possible consideration amounts. An expected value is an appropriate estimate of the amount of variable consideration when there are a large number of contracts with similar characteristics. The most likely amount is the single most likely amount in a range of possible consideration amounts (that is, the single most likely outcome of the contract). The most likely amount is an appropriate estimate of the amount of variable consideration if the contract has limited possible outcomes (for example, an entity either achieves a performance bonus or does not).

Pricing is established at or prior to the time of sale with our customers, and we record sales at the agreed-upon net selling price. However, one of our businesses allows customers to apply for a refund of a percentage of the original purchase price if they can demonstrate sales to a qualifying end customer. We use the expected value method to estimate the anticipated refund to be paid based on historical experience and reduce sales for the probable cost of the discount. The cost of these refunds is recorded as a reduction of the transaction price.

Volume-based incentives involve rebates that are negotiated at or prior to the time of sale with the customer and are redeemable only if the customer achieves a specified cumulative level of sales or sales increase. Under these incentive programs, at the time of sale, we determine the most likely amount of the rebate to be paid based on forecasted sales levels. These forecasts are updated at least quarterly for each customer, and the transaction price is reduced for the anticipated cost of the rebate. If the forecasted sales for a customer change, the accrual for rebates is adjusted to reflect the new amount of rebates expected to be earned by the customer.

Shipping and handling costs

Amounts billed to customers for shipping and handling activities after the customer obtains control are treated as a promised service performance obligation and recorded in Net sales in the accompanying Consolidated Statements of Operations and Comprehensive Income. Shipping and handling costs incurred by Pentair for the delivery of goods to customers are considered a cost to fulfill the contract and are included in Cost of goods sold in the accompanying Consolidated Statements of Operations and Comprehensive Income.

Contract assets and liabilities

Contract assets consist of unbilled amounts resulting from sales under long-term contracts when the cost-to-cost method of revenue recognition is utilized and revenue recognized exceeds the amount billed to the customer, such as when the customer retains a small portion of the contract price until completion of the contract. We typically receive interim payments on sales under long-term contracts as work progresses, although for some contracts, we may be entitled to receive an advance payment. Contract liabilities consist of advanced payments, billings in excess of costs incurred and deferred revenue.

Contract assets are recorded within Other current assets, and contract liabilities are recorded within Other current liabilities in the Consolidated Balance Sheets.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

Contract assets and liabilities consisted of the following:

			December 31
In millions			2025			2024						$ Change			% Change
Contract assets			$	53.9		$	46.7					$	7.2		15.4		%
Contract liabilities			42.8			38.8						4.0			10.3		%
Net contract assets			$	11.1		$	7.9					$	3.2		40.5		%

The $3.2 million increase in net contract assets from December 31, 2024 to December 31, 2025 was primarily the result of timing of milestone payments. Approximately 95% of our contract liabilities at December 31, 2024 were recognized in revenue during the twelve months ended December 31, 2025. There were no impairment losses recognized on our net contract assets for the twelve months ended December 31, 2025 and December 31, 2024.

Practical expedients and exemptions

We generally expense incremental costs of obtaining a contract when incurred because the amortization period would be less than one year. These costs primarily relate to sales commissions and are recorded in Selling, general and administrative expense in the Consolidated Statements of Operations and Comprehensive Income.

We do not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. Further, we do not adjust the promised amount of consideration for the effects of a significant financing component if we expect, at contract inception, that the period between when we transfer a promised good or service to a customer and when the customer pays for that good or service will be one year or less.

Revenue by category

We disaggregate our revenue from contracts with customers by reportable segment, geographic location and vertical market, as we believe these best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Refer to Note 14 for revenue disaggregated by reportable segment.

Geographic net sales information, based on geographic destination of the sale, was as follows:

			Years ended December 31
In millions			2025			2024			2023
U.S.			$	2,938.1		$	2,833.6		$	2,835.9
Western Europe			496.0			493.3			471.9
Developing (1)			507.8			527.2			558.0
Other Developed (2)			234.1			228.7			238.7
Consolidated net sales (3)			$	4,176.0		$	4,082.8		$	4,104.5
(1) Developing primarily includes China, Latin America, the Middle East and Southeast Asia.
(2) Other Developed primarily includes Australia and Canada.
(3) Net sales in Ireland, for each of the years presented, were not material.

Vertical market net sales information was as follows:

			Years ended December 31
In millions			2025			2024			2023
Residential			$	2,389.1		$	2,191.5		$	2,134.0
Commercial			1,003.2			1,117.2			1,177.2
Industrial			783.7			774.1			793.3
Consolidated net sales			$	4,176.0		$	4,082.8		$	4,104.5

Research and development

We conduct research and development (“R&D”) activities primarily in our own facilities, which mostly consist of development of new products, product applications and manufacturing processes. We expense R&D costs as incurred. R&D expenditures during 2025, 2024 and 2023 were $95.9 million, $93.6 million and $99.8 million, respectively.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

Cash equivalents

We consider highly liquid investments with original maturities of three months or less at the date of acquisition to be cash equivalents.

Trade receivables and concentration of credit risk

We record an allowance for credit losses, reducing our receivables balance to an amount we estimate is collectible from our customers. Estimates used in determining the allowance for credit losses are based on current trends, aging of accounts receivable, periodic credit evaluations of our customers’ financial condition, and historical collection experience as well as reasonable and supportable forecasts of future economic conditions. We review our allowance for credit losses on a quarterly basis. Write-offs are recorded at the time all collection efforts have been exhausted. We generally do not require collateral.

The following table summarizes the activity in the allowance for credit losses:

			Years ended December 31
In millions			2025			2024			2023
Beginning balance			$	9.1		$	11.2		$	10.8
Bad debt (benefit) expense			(0.8)			(0.2)			0.7
Acquisitions			0.4			—			—
Write-offs, net of recoveries			(2.0)			(1.4)			(0.7)
Other (1)			0.1			(0.5)			0.4
Ending balance			$	6.8		$	9.1		$	11.2
(1) Other amounts are primarily the effects of changes in currency translations and the impact of allowance for credits.

Inventories

Inventories are stated at the lower of cost or net realizable value with substantially all inventories recorded using the first-in, first-out (“FIFO”) cost method. In 2025 and 2024, we recorded inventory impairment of $17.1 million and $11.3 million, respectively, as a result of restructuring and transformation activities. The impairment charges were recorded in Cost of goods sold in our Consolidated Statements of Operations and Comprehensive Income. No material inventory impairment charges were recorded in 2023.

Property, plant and equipment, net

Property, plant and equipment is stated at historical cost. We compute depreciation by the straight-line method based on the following estimated useful lives:

			Years
Land improvements			5 to 20
Buildings and leasehold improvements			5 to 50
Machinery and equipment			3 to 15
Capitalized software			3 to 10

Significant improvements that add to productive capacity or extend the lives of properties are capitalized. Costs for repairs and maintenance are charged to expense as incurred. We capitalize costs associated with software developed or obtained for internal use when both the preliminary project stage is completed, and it is probable the software being developed will be completed and placed in service. The costs of computer software developed or obtained for internal use are amortized on a straight-line basis unless another systematic and rational basis is more representative of the software’s use. When property or capitalized software is retired or otherwise disposed of, the recorded cost of the assets and their related accumulated depreciation are removed from the Consolidated Balance Sheets and any related gains or losses are included in income.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

The following table presents geographic Property, plant and equipment, net by region as of December 31:

In millions			2025			2024
U.S.			$	235.1		$	225.0
Western Europe			83.2			76.0
Developing (1)			48.9			48.2
Other Developed (2)			9.6			9.6
Consolidated (3)			$	376.8		$	358.8
(1) Developing primarily includes China, Latin America and Southeast Asia.
(2) Other Developed primarily includes Australia.
(3) Property, plant and equipment, net in Ireland, for each of the years presented, were not material.

We review the recoverability of long-lived assets to be held and used, such as property, plant and equipment, when events or changes in circumstances occur that indicate the carrying value of the asset or asset group may not be recoverable. The assessment of possible impairment is based on our ability to recover the carrying value of the asset or asset group from the expected future pre-tax cash flows (undiscounted and without interest charges) of the related operations. If these cash flows are less than the carrying value of such asset or asset group, an impairment loss is recognized for the difference between estimated fair value and carrying value. Impairment losses on long-lived assets held for sale are determined in a similar manner, except that fair values are reduced for the cost to dispose of the assets. The measurement of impairment requires us to estimate future cash flows and the fair value of long-lived assets. No material long-lived asset impairment charges were recorded in 2025, 2024 or 2023.

Goodwill and identifiable intangible assets

Goodwill

Goodwill represents the excess of the cost of acquired businesses over the net of the fair value of identifiable tangible net assets and identifiable intangible assets purchased and liabilities assumed.

We test our goodwill for impairment at least annually during the fourth quarter or more frequently if events or changes in circumstances indicate that the asset might be impaired. We perform our annual or interim goodwill impairment test by comparing the fair value of the relevant reporting unit with its carrying amount. We would recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized would not exceed the total amount of goodwill allocated to that reporting unit.

We have the option to perform a qualitative assessment to determine whether it is necessary to perform the quantitative goodwill impairment test. However, we may elect to perform the quantitative goodwill impairment test even if no indications of a potential impairment exist.

As a result of the qualitative assessments performed during 2025 and 2024, it was determined that it was more likely than not that the fair value of the reporting units exceeded their respective carrying values. Therefore, a quantitative assessment was not required. Factors considered in the analysis included the 2023 discounted cash flow fair value assessment of the reporting units and the calculated excess fair value over carrying amount, financial performance, forecasts and trends, market capitalization, regulatory and environmental issues, macro-economic conditions, industry and market considerations, raw material costs and management stability. We also consider the extent to which each of the adverse events and circumstances identified affect the comparison of the respective reporting unit’s fair value with its carrying amount. We place more weight on the events and circumstances that most affect the respective reporting unit’s fair value or the carrying amount of its net assets. We consider positive and mitigating events and circumstances that may affect its determination of whether it is more likely than not that the fair value exceeds the carrying amount.

Identifiable intangible assets

Our primary identifiable intangible assets include: customer relationships, trade names, proprietary technology and patents. Identifiable intangibles with finite lives are amortized and those identifiable intangibles with indefinite lives are not amortized. Identifiable intangible assets that are subject to amortization are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment charge of $30.9 million was recorded in 2025 related to the write-off of a definite-lived customer relationship intangible asset resulting from a business exit within our Water Solutions segment during the second quarter of 2025. The impairment charge was recorded in Selling, general and administrative expense in our Consolidated Statements of Operations and Comprehensive Income. No impairment charges associated with identifiable intangibles with finite lives were recognized in 2024 or 2023.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

Identifiable intangible assets not subject to amortization are tested for impairment annually or more frequently if events warrant. We complete our annual impairment test the first day of the fourth quarter each year for those identifiable assets not subject to amortization. The impairment test for trade names consists of a comparison of the fair value of the trade name with its carrying value. Fair value is measured using the relief-from-royalty method. This method assumes the trade name has value to the extent that the owner is relieved of the obligation to pay royalties for the benefits received from them. This method requires us to estimate the future revenue for the related brands, the appropriate royalty rate and the weighted average cost of capital. The non-recurring fair value measurement is a “Level 3” measurement under the fair value hierarchy. No impairment charges were recognized in 2025, 2024 or 2023 as a result of our annual impairment assessment.

Income taxes

We use the asset and liability approach to account for income taxes. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of differences between the carrying amounts of assets and liabilities and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period when the change is enacted. We maintain valuation allowances unless it is more likely than not that all or a portion of the deferred tax assets will be realized. Changes in valuation allowances from period to period are included in our tax provision in the period of change. We recognize the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

Pension and other post-retirement plans

We sponsor U.S. and non-U.S. defined-benefit pension and other post-retirement plans. The pension and other post-retirement benefit costs for company-sponsored benefit plans are determined from actuarial assumptions and methodologies, including discount rates and expected returns on plan assets. These assumptions are updated annually and are disclosed in Note 11.

We recognize changes in the fair value of plan assets and net actuarial gains or losses for pension and other post-retirement benefits annually in the fourth quarter each year (“mark-to-market adjustment”) and, if applicable, in any quarter in which an interim re-measurement is triggered. Net actuarial gains and losses occur when the actual experience differs from any of the various assumptions used to value our pension and other post-retirement plans or when assumptions change, as they may each year. The remaining components of pension expense, including service and interest costs and estimated return on plan assets, are recorded on a quarterly basis. The service costs are recorded within Operating income and the interest costs, expected return on plan assets and net actuarial gain/loss components of net periodic pension and other post-retirement benefit costs are recorded within Other expense (income).

Insurance subsidiary

A portion of our property and casualty insurance program is insured through our regulated wholly owned captive insurance subsidiary, Penwald Insurance Company (“Penwald”). Reserves for policy claims are established based on actuarial projections of ultimate losses. As of December 31, 2025 and 2024, reserves for policy claims were $70.8 million, of which $18.0 million was included in Other current liabilities and $52.8 million was included in Other non-current liabilities, and $68.6 million, of which $13.0 million was included in Other current liabilities and $55.6 million was included in Other non-current liabilities, respectively.

Share-based compensation

We account for share-based compensation awards on a fair value basis. The estimated grant date fair value of each option award is recognized in income on an accelerated basis over the requisite service period (generally the vesting period). The estimated fair value of each option award is calculated using the Black-Scholes option-pricing model. From time to time, we have elected to modify the terms of the original grant. These modified grants are accounted for as a new award and measured using the fair value method, resulting in the inclusion of additional compensation expense in our Consolidated Statements of Operations and Comprehensive Income.

Restricted share awards and units (“RSUs”) are recorded as compensation cost over the requisite service periods based on the market value on the date of grant.

Performance share units (“PSUs”) are stock awards where the ultimate number of shares issued will be contingent on the Company’s performance against certain performance goals. The Compensation Committee has the ability to adjust performance goals or modify the manner of measuring or evaluating a performance goal using its discretion. The fair value of each PSU is based on the market value on the date of grant. We recognize expense related to the estimated vesting of our PSUs granted. The estimated vesting of the PSUs is based on the probability of achieving certain performance metrics over the specified performance period.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

The requisite service period for options and RSUs and the performance period for PSUs may be shorter than the vesting period if the employee becomes retirement eligible before the end of the vesting period.

Earnings per ordinary share

We present two calculations of earnings per ordinary share (“EPS”). Basic EPS equals net income divided by the weighted-average number of ordinary shares outstanding during the period. Diluted EPS is computed by dividing net income by the sum of weighted-average number of ordinary shares outstanding plus dilutive effects of ordinary share equivalents, calculated using the two-class method.

Derivative financial instruments

We recognize all derivatives, including those embedded in other contracts, as either assets or liabilities at fair value in our Consolidated Balance Sheets. If the derivative is designated and effective, the effective portion of changes in the fair value of the derivative is recorded in Accumulated other comprehensive income (loss) (“AOCI”) as a separate component of equity in the Consolidated Balance Sheets and is recognized in the Consolidated Statements of Operations and Comprehensive Income when the hedged item affects earnings. If the underlying hedged transaction ceases to exist or if the hedge becomes ineffective, all changes in fair value of the related derivatives that have not been settled are recognized in current earnings. For a derivative that is not designated as or does not qualify as a hedge, changes in fair value are reported in earnings immediately.

We use derivative instruments for the purpose of hedging interest rate and currency exposures, which exist as part of ongoing business operations. We do not hold or issue derivative financial instruments for trading or speculative purposes. Our policy is not to enter into contracts with terms that cannot be designated as normal purchases or sales. From time to time, we may enter into short duration foreign currency contracts to hedge foreign currency risks.

Foreign currency translation

The financial statements of the Company’s non-U.S. dollar functional currency international subsidiaries are measured using the local currency as the functional currency. Assets and liabilities of these subsidiaries are translated at the rates of exchange at the balance sheet date. Income (loss) and expense items are translated at average monthly rates of exchange. The resultant translation adjustments are included in AOCI, a component of equity.

New and recently adopted accounting standards

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-09, “Improvements to Income Tax Disclosures,” which requires new and enhanced disclosures primarily related to income taxes paid and the effective tax rate reconciliation. We adopted the standard prospectively beginning with our annual reporting for the year ended December 31, 2025. Refer to Note 10 for further information on our income taxes.

In November 2024, the FASB issued ASU No. 2024-03, “Disaggregation - Income Statement Expenses,” which requires disclosure of disaggregation of certain relevant expenses within the Consolidated Statements of Operations and Comprehensive Income on an annual and interim basis. We will adopt the standard beginning with our annual reporting for the year ending December 31, 2027. We are currently evaluating the effect that the updated standard will have on our financial statement disclosures.

2. Acquisitions

On September 17, 2025, as part of our Flow reportable segment, we completed the acquisition of Hydra-Stop, LLC for $292.1 million in cash, net of cash acquired, and subject to customary adjustments. The excess purchase price over tangible and identifiable intangible net assets acquired has been preliminarily allocated to goodwill in the amount of $169.2 million, all of which is expected to be deductible for income tax purposes. Identifiable intangible assets acquired include $112.0 million of definite-lived customer relationships with an estimated useful life of 18 years and $6.2 million of definite-lived proprietary technology intangible assets with an estimated useful life of 7 years. The pro forma impact of the acquisition was not material.

In December 2024, as part of our Pool reportable segment, we completed the acquisition of G & F Manufacturing, LLC for $116.0 million in cash, net of cash acquired. The net purchase price was comprised of an upfront cash payment of $108.0 million, and the estimated fair value at the acquisition date of contingent earn-out liabilities based upon the achievement of certain defined operating results in the two years following the acquisition. The excess purchase price over tangible and identifiable intangible net assets acquired has been allocated to goodwill in the amount of $56.6 million, all of which is expected to be deductible for income tax purposes. Identifiable intangible assets acquired consisted of $51.6 million of definite-lived customer relationships with an estimated useful life of 16 years. The pro forma impact of the acquisition was not material.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

3. Earnings Per Share

Basic and diluted earnings per share were calculated as follows:

			Years ended December 31
In millions, except per share data			2025			2024			2023
Net income			$	653.8		$	625.4		$	622.7
Net income from continuing operations			$	649.5		$	625.6		$	622.9
Weighted average ordinary shares outstanding
Basic			164.1			165.6			165.1
Dilutive impact of stock options and restricted stock awards			1.4			1.5			1.2
Diluted			165.5			167.1			166.3
Earnings per ordinary share
Basic
Continuing operations			$	3.96		$	3.78		$	3.77
Discontinued operations			0.03			—			—
Basic earnings per ordinary share			$	3.99		$	3.78		$	3.77
Diluted
Continuing operations			$	3.93		$	3.74		$	3.75
Discontinued operations			0.03			—			—
Diluted earnings per ordinary share			$	3.96		$	3.74		$	3.75
Anti-dilutive stock options excluded from the calculation of diluted earnings per share			0.1			0.1			0.3

4. Restructuring and Transformation Program

We have a program designed to accelerate growth and drive margin expansion through transformation of our business model to drive operational excellence, reduce complexity and streamline our processes (the “Transformation Program”). The Transformation Program is structured in multiple phases and is expected to empower us to work more efficiently and optimize our business to better serve our customers while meeting our financial objectives.

During 2025, 2024 and 2023, we initiated and continued execution of activities associated with our Transformation Program as well as initiated and continued certain business restructuring initiatives aimed at reducing our fixed cost structure and realigning our business. Restructuring and Transformation Program initiatives during the years ended December 31, 2025, 2024 and 2023 included a reduction in hourly and salaried headcount of approximately 325 employees, 575 employees and 475 employees, respectively.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

Restructuring and transformation-related costs included within Cost of goods sold and Selling, general and administrative expense in the Consolidated Statements of Operations and Comprehensive Income included the following:

			Years ended December 31
In millions			2025			2024			2023
Restructuring Initiatives
Severance and related costs			$	27.4		$	34.5		$	8.2
Asset impairment and write-offs (1)			2.0			9.9			3.8
Other restructuring costs and related adjustments (2)			7.3			(0.9)			(6.0)
Total restructuring costs			36.7			43.5			6.0
Transformation Program
Severance and related costs			—			0.7			6.9
Asset impairment and write-offs (1)			16.2			7.7			0.4
Other transformation costs (3)			40.8			51.4			37.4
Total transformation costs			57.0			59.8			44.7
Total restructuring and transformation costs			$	93.7		$	103.3		$	50.7

(1) Consists of inventory and long-lived asset impairments and write-offs associated with restructuring or transformation activities.

(2) Other restructuring costs and related adjustments primarily consist of certain accruals and related refinements as well as various contract termination costs associated with business and product line exits.

(3) Other transformation costs primarily consist of professional services and project management related costs, partially offset by gain on sale of assets in 2023.

Restructuring and transformation costs by reportable segment as well as Corporate and other were as follows:

			Years ended December 31
In millions			2025			2024			2023
Flow			$	19.7		$	15.5		$	3.4
Water Solutions			16.7			19.4			(0.1)
Pool			13.4			15.7			9.1
Corporate and other			43.9			52.7			38.3
Total restructuring and transformation costs			$	93.7		$	103.3		$	50.7

Activity related to accrued severance and related costs recorded in Other current liabilities in the Consolidated Balance Sheets is summarized as follows:

			Years ended December 31
In millions			2025			2024
Beginning balance			$	18.7		$	13.4
Costs incurred			27.4			35.2
Cash payments and other			(32.1)			(29.9)
Ending balance			$	14.0		$	18.7

Pentair plc and Subsidiaries

Notes to consolidated financial statements

5. Goodwill and Other Identifiable Intangible Assets

The changes in the carrying amount of goodwill for the years ended December 31, 2025 and 2024 by reportable segment were as follows:

In millions			December 31, 2024			Acquisitions									Foreign currency translation			December 31, 2025
Flow			$	730.4		$	169.2								$	67.9		$	967.5
Water Solutions			1,392.7			—									14.4			1,407.1
Pool			1,163.5			—									—			1,163.5
Total goodwill			$	3,286.6		$	169.2								$	82.3		$	3,538.1

In millions			December 31, 2023			Acquisitions						Foreign currency translation			December 31, 2024
Flow			$	767.1		$	—					$	(36.7)		$	730.4
Water Solutions			1,400.6			—						(7.9)			1,392.7
Pool			1,106.9			56.6						—			1,163.5
Total goodwill			$	3,274.6		$	56.6					$	(44.6)		$	3,286.6

There has been no impairment of goodwill for any of the years presented.

Identifiable intangible assets consisted of the following at December 31:

			2025												2024
In millions			Cost			Accumulated amortization			Net						Cost			Accumulated amortization			Net
Definite-life intangibles
Customer relationships			$	1,166.0		$	(389.4)		$	776.6					$	1,146.5		$	(400.2)		$	746.3
Proprietary technology and patents			82.4			(41.6)			40.8						88.8			(48.4)			40.4
Total definite-life intangibles			1,248.4			(431.0)			817.4						1,235.3			(448.6)			786.7
Indefinite-life intangibles
Trade names			255.9			—			255.9						247.1			—			247.1
Total intangibles			$	1,504.3		$	(431.0)		$	1,073.3					$	1,482.4		$	(448.6)		$	1,033.8

Identifiable intangible asset amortization expense in 2025, 2024 and 2023 was $58.1 million, $54.3 million and $55.3 million, respectively.

An impairment charge of $30.9 million was recorded in 2025 related to the write-off of a definite-lived customer relationship intangible asset resulting from a business exit within our Water Solutions segment during the second quarter of 2025. The impairment charge was recorded in Selling, general and administrative expense in the Consolidated Statements of Operations and Comprehensive Income. No impairment charge was recorded for identifiable intangible assets in 2024 or 2023.

Estimated future amortization expense for identifiable intangible assets during the next five years is as follows:

In millions			2026			2027			2028			2029			2030
Estimated amortization expense			$	61.6		$	60.3		$	57.6		$	57.2		$	56.6

Pentair plc and Subsidiaries

Notes to consolidated financial statements

6. Supplemental Balance Sheet Information

			December 31
In millions			2025			2024
Inventories
Raw materials and supplies			$	311.7		$	315.8
Work-in-process			88.8			88.4
Finished goods			232.1			206.7
Total inventories			$	632.6		$	610.9
Other current assets
Cost in excess of billings			$	53.9		$	46.7
Prepaid expenses			66.2			51.0
Other current assets			14.3			43.6
Total other current assets			$	134.4		$	141.3
Property, plant and equipment, net
Land and land improvements			$	33.2		$	31.3
Buildings and leasehold improvements			241.2			217.9
Machinery and equipment			702.7			675.8
Capitalized software			98.2			92.2
Construction in progress			45.1			51.1
Total property, plant and equipment			1,120.4			1,068.3
Accumulated depreciation and amortization			743.6			709.5
Total property, plant and equipment, net			$	376.8		$	358.8
Other non-current assets
Right-of-use lease assets			$	115.3		$	116.1
Deferred income taxes			134.2			129.6
Deferred compensation plan assets			32.3			29.4
Other non-current assets			57.0			56.1
Total other non-current assets			$	338.8		$	331.2
Other current liabilities
Dividends payable			$	44.1		$	41.2
Accrued warranty			69.8			67.2
Accrued rebates and incentives			180.3			176.7
Accrued freight			14.9			18.4
Billings in excess of cost			37.4			33.8
Current lease liability			28.5			26.3
Income taxes payable			26.8			28.8
Accrued restructuring			14.0			18.7
Interest payable			22.5			5.5
Other current liabilities			99.4			80.2
Total other current liabilities			$	537.7		$	496.8
Other non-current liabilities
Long-term lease liability			$	98.8		$	92.8
Income taxes payable			8.5			8.1
Self-insurance liabilities			52.8			55.6
Deferred compensation plan liabilities			32.3			29.4
Foreign currency and interest rate contract liabilities			69.0			16.3
Other non-current liabilities			34.0			41.6
Total other non-current liabilities			$	295.4		$	243.8

Pentair plc and Subsidiaries

Notes to consolidated financial statements

7. Accumulated Other Comprehensive Loss

Components of Accumulated Other Comprehensive Loss consist of the following:

			December 31
In millions			2025			2024
Cumulative translation adjustments			$	(229.0)		$	(322.3)
Market value of derivative financial instruments, net of tax			(39.2)			45.7
Accumulated other comprehensive loss			$	(268.2)		$	(276.6)

8. Debt

Debt and the average interest rates on debt outstanding were as follows:

In millions			Average interest rate at			Maturity Year			December 31
December 31, 2025			2025			2024
Revolving credit facility (Senior Credit Facility)			4.852%			2030			$	277.7		$	9.5
Term Loan Facility			5.114%			2027			575.0			825.0
Senior notes - fixed rate (1)			N/A			2025			—			19.3
Senior notes - fixed rate (1)			4.500%			2029			400.0			400.0
Senior notes - fixed rate (1)			5.900%			2032			400.0			400.0
Other			N/A			2025			—			9.3
Unamortized debt issuance costs and discounts			N/A			N/A			(14.1)			(15.1)
Total debt									1,638.6			1,648.0
Less: Current maturities of short-term borrowings									—			9.3
Long-term debt									$	1,638.6		$	1,638.7
(1) Senior notes are guaranteed as to payment by Pentair plc.

Pentair, Pentair Finance S.à r.l (“PFSA“) and Pentair, Inc. are parties to a credit agreement (the “Senior Credit Facility”), with Pentair as guarantor and PFSA and Pentair, Inc. as borrowers, which was amended and restated in May 2025, providing for a $900.0 million senior unsecured revolving credit facility. The Senior Credit Facility has a maturity date of May 5, 2030. Borrowings under the Senior Credit Facility bear interest at a rate equal to an alternate base rate, adjusted term secured overnight financing rate, adjusted euro interbank offered rate, adjusted daily simple secured overnight financing rate or central bank rate, plus, in each case, an applicable margin. The applicable margin is based on, at PFSA’s election, Pentair’s leverage level or PFSA’s public credit rating.

As of December 31, 2025, total availability under the Senior Credit Facility was $622.3 million. In addition, PFSA has the option to request to increase the revolving credit facility and/or to enter into one or more additional tranches of term loans in an aggregate amount of up to $450.0 million, subject to customary conditions, including the commitment of the participating lenders.

In addition, Pentair and PFSA are parties to a senior unsecured term loan facility (the “Term Loan Facility”), with PFSA, as borrower, Pentair, as guarantor, providing for an aggregate principal amount of $1.0 billion. The Term Loan Facility has a maturity date of July 28, 2027, with required quarterly installment payments of $6.3 million which began on the last day of the third quarter of 2023 and increased to $12.5 million on the last day of the third quarter of 2024. During 2024, PFSA repaid the remaining $162.5 million of quarterly installments on the Term Loan Facility, such that PFSA is not required to make any further quarterly installment payments. As of December 31, 2025, the remaining obligation of $575.0 million matures on July 28, 2027. The Term Loan Facility bears interest at a rate equal to an alternate base rate, adjusted term secured overnight financing rate, or adjusted daily simple secured overnight financing rate, plus, in each case, an applicable margin. The applicable margin is based on, at PFSA’s election, Pentair’s leverage level or PFSA’s public credit rating.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

Our debt agreements contain various financial covenants, but the most restrictive covenants are contained in the Senior Credit Facility and the Term Loan Facility. The Senior Credit Facility and the Term Loan Facility contain covenants requiring us not to permit (i) the ratio of our consolidated debt (net of our consolidated unrestricted cash and cash equivalents in excess of $5.0 million but not to exceed $250.0 million) to our consolidated net income (excluding, among other things, non-cash gains and losses) before interest, taxes, depreciation, amortization and non-cash share-based compensation expense (“EBITDA”) on the last day of any period of four consecutive fiscal quarters (each, a “testing period”) to exceed 3.75 to 1.00 (or, at PFSA’s election and subject to certain conditions, 4.25 to 1.00 for four testing periods in connection with certain material acquisitions) (the “Leverage Ratio”) and (ii) the ratio of our EBITDA to our consolidated interest expense, for the same period to be less than 3.00 to 1.00 as of the end of each fiscal quarter. For purposes of the Leverage Ratio, the Senior Credit Facility and the Term Loan Facility provide for the calculation of EBITDA giving pro forma effect to certain acquisitions, divestitures and liquidations during the period to which such calculation relates.

In addition to the Senior Credit Facility and the Term Loan Facility, we have various other credit facilities with an aggregate availability of $21.0 million, of which there were no outstanding borrowings at December 31, 2025. Borrowings under these credit facilities bear interest at variable rates.

We have no senior notes maturing in the next twelve months.

Debt outstanding, excluding unamortized issuance costs and discounts, at December 31, 2025 matures on a calendar year basis as follows:

In millions			2026			2027			2028			2029			2030			Thereafter			Total
Contractual debt obligation maturities			$	—		$	575.0		$	—		$	400.0		$	277.7		$	400.0		$	1,652.7

9. Derivatives and Financial Instruments

Derivative financial instruments

We are exposed to market risk related to changes in foreign currency exchange rates and interest rates on our variable rate indebtedness. To manage the volatility related to these exposures, we periodically enter into a variety of derivative financial instruments. Our objective is to reduce, where it is deemed appropriate to do so, fluctuations in earnings and cash flows associated with changes in foreign currency rates or variable interest rates. The derivative contracts contain credit risk to the extent that our bank counterparties may be unable to meet the terms of the agreements. The amount of such credit risk is generally limited to the unrealized gains, if any, in such contracts. Such risk is minimized by limiting those counterparties to major financial institutions of high credit quality.

Foreign currency contracts

We conduct business in various locations throughout the world and are subject to market risk due to changes in the value of foreign currencies in relation to our reporting currency, the U.S. dollar. We manage our economic and transaction exposure to certain market-based risks through the use of foreign currency derivative financial instruments. Our objective in holding these derivatives is to reduce the volatility of net earnings and cash flows associated with changes in foreign currency exchange rates. The majority of our foreign currency contracts have an original maturity date of less than one year.

At December 31, 2025, we had outstanding foreign currency derivative contracts with gross notional U.S. dollar equivalent amounts of $23.2 million. At December 31, 2024, there were no outstanding foreign currency derivative contracts. The impact of these contracts on the Consolidated Statements of Operations and Comprehensive Income was not material for any period presented.

Cross currency swaps

At December 31, 2025 and 2024, we had outstanding cross currency swap agreements with a combined notional amount of $1.1 billion and $728.5 million, respectively. The agreements are accounted for as either cash flow hedges, to hedge foreign currency fluctuations on certain intercompany debt, or as net investment hedges to manage our exposure to fluctuations in the Euro-U.S. Dollar exchange rate. As of December 31, 2025 and 2024, we had deferred foreign currency losses of $68.0 million and $13.8 million, respectively, recorded in Accumulated other comprehensive loss associated with our cross currency swap activity. The periodic interest settlements related to our cross currency swap agreements are classified as operating activities. The cash flows that relate to principal balances are classified as financing activities for the cash flow hedges on intercompany debt and investing activities for the net investment hedges.

In December 2025, €150 million of our cross currency swap agreements matured, resulting in a net cash payment of $28.4 million, of which $28.9 million is included in investing activities and $0.5 million of interest income is included within operating activities on the Consolidated Statements of Cash Flows. Subsequent to the termination, we entered into new cross currency swap agreements with euro notional amounts matching the original swap agreements.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

In October 2025, we entered into a new cross currency swap agreement with a notional amount of €212 million, designated as a cash flow hedge, which will hedge the cash flows related to foreign currency exchange rate fluctuations on intercompany debt.

In December 2024, a cross currency swap agreement, which was accounted for as a cash flow hedge, matured, resulting in a net cash payment of $8.3 million, of which $9.1 million is included within financing activities and $0.8 million of interest income is included within operating activities on the Consolidated Statements of Cash Flows.

In November 2024, we entered into transactions to early terminate and cash settle €450.0 million our cross currency swap agreements, resulting in total net cash received of $11.4 million, of which $10.6 million is included within investing activities and $0.8 million of interest income is included within operating activities on the Consolidated Statements of Cash Flows. Subsequent to the termination, we entered into new cross currency swap agreements with euro notional amounts matching the original swap agreements.

In August 2024, we entered into a transaction to early terminate and cash settle a €150 million cross currency swap agreement, resulting in a net cash payment of $16.1 million, of which $16.4 million is included in investing activities and $0.3 million of interest income is included within operating activities on the Consolidated Statements of Cash Flows. Subsequent to the termination, we entered into new cross currency swap agreements with euro notional amounts matching the original swap agreement.

Hedging of variable interest rates

We manage our exposure to certain interest rate risks related to our variable-rate debt through the use of interest rate swaps and collars. We enter into these agreements to hedge the variability of interest expense and cash flows attributable to changes in interest rates of our variable-rate debt. As of December 31, 2025, we had an aggregate notional amount of $300.0 million and $200.0 million in interest rate swaps and collars, respectively, that are designated as cash flow hedges.

Unrealized gains and losses related to the fair value of the interest rate swaps are recorded in Accumulated other comprehensive loss on our Consolidated Balance Sheets. We had an unrealized loss of $0.2 million at December 31, 2025 and an unrealized gain of $1.9 million at December 31, 2024, recorded in Accumulated other comprehensive loss associated with our interest rate swap and collar activity. The periodic interest settlements related to our interest rate swaps and collars are classified as operating activities.

Fair value measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date:

Level 1:						Valuation is based on observable inputs such as quoted market prices (unadjusted) for identical assets or liabilities in active markets.
Level 2:						Valuation is based on inputs such as quoted market prices for similar assets or liabilities in active markets or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
Level 3:						Valuation is based upon other unobservable inputs that are significant to the fair value measurement.

In making fair value measurements, observable market data must be used when available. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

Fair value of financial instruments

The following methods were used to estimate the fair values of each class of financial instrument:

• short-term financial instruments (cash and cash equivalents, accounts and notes receivable, accounts payable and variable-rate debt) — recorded amount approximates fair value because of the short maturity period;

• long-term fixed-rate debt, including current maturities — fair value is based on market quotes available for issuance of debt with similar terms, which are inputs that are classified as Level 2 in the valuation hierarchy defined above;

• foreign currency contracts, interest rate swap and collar agreements — fair values are determined through the use of models that consider various assumptions, including time value, yield curves, as well as other relevant economic measures, which are inputs that are classified as Level 2 in the valuation hierarchy defined above;

Pentair plc and Subsidiaries

Notes to consolidated financial statements

• deferred compensation plan assets (mutual funds, common/collective trusts and cash equivalents for payment of certain non-qualified benefits for retired, terminated and active employees) — fair value of mutual funds and cash equivalents are based on quoted market prices in active markets that are classified as Level 1 in the valuation hierarchy defined above; fair value of common/collective trusts are valued at net asset value (“NAV”), which is based on the fair value of the underlying securities owned by the fund and divided by the number of shares outstanding; and

• contingent earn-out liabilities — fair value is generally established using a probability-weighted discounted income approach to convert future estimated cash flows to a single present value amount. The related inputs are classified as Level 3 in the valuation hierarchy defined above.

The recorded amounts and estimated fair values of total debt, excluding unamortized issuance costs and discounts, at December 31 were as follows:

			2025									2024
In millions			Recorded Amount			Fair Value						Recorded Amount			Fair Value
Variable rate debt			$	852.7		$	852.7					$	843.8		$	843.8
Fixed rate debt			800.0			828.2						819.3			814.3
Total debt			$	1,652.7		$	1,680.9					$	1,663.1		$	1,658.1

Financial assets and liabilities measured at fair value on a recurring and nonrecurring basis were as follows:

			December 31, 2025
In millions			Level 1			Level 2			Level 3			NAV			Total
Recurring fair value measurements
Interest rate contract liabilities			$	—		$	(0.2)		$	—		$	—		$	(0.2)
Foreign currency contract liabilities			—			(68.8)			—			—			(68.8)
Deferred compensation plan assets			32.3			—			—			—			32.3
Contingent earn-out liabilities			—			—			(8.0)			—			(8.0)
Total recurring fair value measurements			$	32.3		$	(69.0)		$	(8.0)		$	—		$	(44.7)
Nonrecurring fair value measurements (1)

1. During the year ended December 31, 2025, we recorded an impairment charge on a definite-lived customer relationship intangible asset of $30.9 million. We determined the value using unobservable inputs and wrote the balance of the definite-lived intangible asset to zero. The impairment charge was recorded in Selling, general and administrative expense in the Consolidated Statements of Operations and Comprehensive Income.

			December 31, 2024
In millions			Level 1			Level 2			Level 3			NAV			Total
Recurring fair value measurements
Interest rate contract assets			$	—		$	1.9		$	—		$	—		$	1.9
Foreign currency contract assets			—			2.5			—			—			2.5
Foreign currency contract liabilities			—			(16.3)			—			—			(16.3)
Deferred compensation plan assets			15.0			—			—			14.4			29.4
Contingent earn-out liabilities			—			—			(8.0)			—			(8.0)
Total recurring fair value measurements			$	15.0		$	(11.9)		$	(8.0)		$	14.4		$	9.5

In December 2024, we completed the acquisition of G & F Manufacturing, LLC (“G & F Manufacturing”). In conjunction with the acquisition of G & F Manufacturing, we recorded an estimated fair value of $8.0 million of contingent earn-out liabilities, which are considered Level 3 under our fair value hierarchy. The recorded fair value of the associated contingent earn-out liabilities was reviewed as of December 31, 2025, with no change in fair value. The fair value of the contingent earn-out liabilities will be re-measured for each reporting period until resolution of the contingent earn-out payments, and any resulting changes to fair value would be recorded in earnings.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

10. Income Taxes

Income from continuing operations before income taxes consisted of the following:

			Years ended December 31
In millions			2025			2024			2023
Federal (1)			$	1.5		$	1.9		$	(9.9)
International (2)			755.0			717.0			628.8
Income from continuing operations before income taxes			$	756.5		$	718.9		$	618.9

(1) “Federal” reflects United Kingdom (“U.K.”) income (loss) from continuing operations before income taxes, given U.K. tax residency.

(2) “International” reflects non-U.K. income from continuing operations before income taxes.

The provision (benefit) for income taxes consisted of the following:

			Years ended December 31
In millions			2025			2024			2023
Currently payable (receivable)
Federal (1)			$	2.1		$	3.0		$	—
International (2)			109.2			101.7			88.5
Total current taxes			111.3			104.7			88.5
Deferred
International (2)			(4.3)			(11.4)			(92.5)
Total deferred taxes			(4.3)			(11.4)			(92.5)
Total provision (benefit) for income taxes			$	107.0		$	93.3		$	(4.0)

(1) “Federal” represents U.K. taxes.

(2) “International” represents non-U.K. taxes.

Reconciliations of the federal statutory income tax rate to our effective tax rate by amount (in millions) and percent for the year ended December 31, 2025 were as follows:

			Year ended December 31, 2025
			Amounts			Percentages
Tax at U.K. federal statutory rate			$	189.1		25.0		%
Foreign tax effects
Switzerland
Statutory tax rate difference between Switzerland and U.K.			(73.1)			(9.7)
Partnership impacts			(23.7)			(3.1)
Cantonal income taxes			9.9			1.3
Other			3.5			0.5
United States
Statutory tax rate difference between U.S. and U.K.			(8.7)			(1.2)
Excess tax benefits on stock-based compensation			(7.8)			(1.0)
State taxes			7.2			0.9
Other			6.2			0.8
Other foreign jurisdictions			2.2			0.3
Other			1.7			0.2
Worldwide changes in prior year unrecognized tax benefits			0.5			0.1
Total			$	107.0		14.1		%

Pentair plc and Subsidiaries

Notes to consolidated financial statements

Reconciliations of the federal statutory income tax rate to our effective tax rate for the years ended December 31, 2024 and 2023 were as follows:

			Years ended December 31
Percentages			2024			2023
U.K. federal statutory income tax rate (1)			25.0		%	23.5		%
Tax effect of international operations (2)			(11.5)			(13.2)
Change in valuation allowances			2.0			2.2
Withholding taxes			1.5			—
Excess tax benefits on stock-based compensation			(1.5)			(0.1)
Unrecognized tax benefits			(2.7)			—
Worthless stock deduction			—			(5.0)
Change in tax basis in foreign assets (3)			0.2			(8.0)
Effective tax rate			13.0		%	(0.6)		%

(1) The U.K. Finance Act of 2021 increased the statutory tax rate from 19.0% to 25.0%, effective April 1, 2023. Given this change, a prorated U.K. federal statutory income tax rate was utilized for 2023.

(2) The tax effect of international operations consists of non-U.K. jurisdictions.

(3) The 2023 impact primarily represents the initial recognition of tax basis in intangible assets in foreign jurisdictions and the related valuation allowance.

Income taxes paid (net of refunds received) for the year ended December 31, 2025 were as follows:

In millions			Year ended December 31, 2025
Foreign
Australia			$	5.8
China			8.1
Germany			13.2
India			13.6
Switzerland			11.0
United States			21.2
Other foreign jurisdictions			14.0
Total			$	86.9

Reconciliations of the beginning and ending gross unrecognized tax benefits were as follows:

			Years ended December 31
In millions			2025			2024			2023
Beginning balance			$	6.0		$	38.6		$	39.6
Gross increases for tax positions in prior periods			1.9			—			0.6
Gross decreases for tax positions in prior periods			(0.2)			(31.5)			(0.2)
Gross increases based on tax positions related to the current year			0.2			0.2			1.6
Gross decreases related to settlements with taxing authorities			(1.2)			(1.3)			(3.0)
Ending balance			$	6.7		$	6.0		$	38.6

We record gross unrecognized tax benefits in Other current liabilities and Other non-current liabilities in the Consolidated Balance Sheets. Included in the $6.7 million of total gross unrecognized tax benefits as of December 31, 2025 was $5.4 million of tax benefits that, if recognized, would impact the effective tax rate.

Based on the outcome of these examinations, or as a result of the expiration of statutes of limitations for specific jurisdictions, it is reasonably possible that certain unrecognized tax benefits for tax positions taken on previously filed tax returns will materially change from those recorded as liabilities in our financial statements. A number of tax periods from 2009 to present are under audit by tax authorities in various jurisdictions, including Germany, India, Singapore, the U.S. and various U.S. states. We anticipate that several of these audits may be concluded in the foreseeable future.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

We record penalties and interest related to unrecognized tax benefits in Provision (benefit) for income taxes and Net interest expense, respectively, in the Consolidated Statements of Operations and Comprehensive Income. At December 31, 2025 and 2024, we had no liabilities for the possible payment of penalties. At December 31, 2025 and 2024, we had $3.5 million and $3.9 million, respectively, for the possible payment of interest expense, which are recorded in Other current liabilities in the Consolidated Balance Sheets.

Deferred taxes arise because of different treatment between financial statement accounting and tax accounting, known as “temporary differences.” We record the tax effect of these temporary differences as “deferred tax assets” (generally items that can be used as a tax deduction or credit in future periods) and “deferred tax liabilities” (generally items for which we received a tax deduction but the tax impact has not yet been recorded in the Consolidated Statements of Operations and Comprehensive Income).

Deferred taxes were recorded in the Consolidated Balance Sheets as follows:

			December 31
In millions			2025			2024
Other non-current assets			$	134.2		$	129.6
Deferred tax liabilities			47.5			44.4
Net deferred tax assets			$	86.7		$	85.2

The tax effects of the major items recorded as deferred tax assets and liabilities were as follows:

			December 31
In millions			2025			2024
Deferred tax assets
Accrued liabilities and reserves			$	52.0		$	54.8
Pension and other post-retirement compensation and benefits			16.6			17.5
Employee compensation and benefits			27.4			27.4
Research and development costs			44.4			36.6
Tax loss and credit carryforwards			728.9			691.4
Interest limitations			231.9			214.0
Total deferred tax assets			1,101.2			1,041.7
Valuation allowance			773.3			739.7
Deferred tax assets, net of valuation allowance			327.9			302.0
Deferred tax liabilities
Property, plant and equipment			11.3			17.1
Goodwill and other intangibles			214.1			177.9
Other liabilities			15.8			21.8
Total deferred tax liabilities			241.2			216.8
Net deferred tax assets			$	86.7		$	85.2

As of December 31, 2025, tax loss carryforwards of $3,016.5 million were available to offset future income. A valuation allowance of $716.0 million exists for deferred income tax benefits related to the tax loss carryforwards which may not be realized. We believe sufficient taxable income will be generated in the respective jurisdictions to allow us to fully recover the remainder of the tax losses. The tax losses primarily relate to non-U.S. carryforwards of $2,959.9 million of which $1,793.2 million are located in jurisdictions with unlimited tax loss carryforward periods, while the remainder will begin to expire in 2026. In addition, there were $56.6 million of U.S. state tax loss carryforwards as of December 31, 2025. U.S. state tax losses of $6.3 million are in jurisdictions with unlimited tax loss carryforward periods, while the remainder will expire in future years through 2045.

Deferred taxes in the amount of $2.3 million have been provided on undistributed earnings of certain subsidiaries. Taxes have not been provided on undistributed earnings of subsidiaries where it is our intention to reinvest these earnings permanently or to repatriate the earnings only when it is tax effective to do so. It is not practicable to estimate the amount of tax that might be payable if such earnings were to be remitted.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

The Organization for Economic Co-operation and Development Pillar Two Model Rules (“Pillar Two”) for a global 15.0% minimum tax have been adopted by a number of jurisdictions in which we operate. For the year ended December 31, 2025, the impact of Pillar Two on our consolidated financial statements was not material.

On July 4, 2025, the U.S. enacted H.R.1 – One Big Beautiful Bill Act (the “Act”). The Act contains numerous income tax provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act and modifications to the international tax framework. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. For the year ended December 31, 2025, the impact of the Act on our consolidated financial statements was not material.

11. Benefit Plans

Pension and other post-retirement plans

We sponsor U.S. and non-U.S. defined-benefit pension and other post-retirement plans. Pension benefits are based principally on an employee’s years of service and/or compensation levels near retirement. In addition, we provide certain post-retirement health care and life insurance benefits. Generally, the post-retirement health care and life insurance plans require contributions from retirees.

Obligations and funded status

The following tables present reconciliations of plan benefit obligations, fair value of plan assets and the funded status of pension plans and other post-retirement plans as of and for the years ended December 31, 2025 and 2024:

			Pension plans															Other post-retirement plans
In millions			2025			2024															2025			2024
Change in benefit obligations
Benefit obligation beginning of year			$	83.3		$	97.5														$	6.6		$	7.6
Service cost			1.4			1.7															—			—
Interest cost			3.8			3.9															0.3			0.4
Settlement (1)			—			(6.8)															—			—
Curtailment (1)			—			(2.0)															—			—
Actuarial loss (gain) (2)			3.0			(2.7)															0.2			(0.6)
Foreign currency translation			1.6			(1.1)															—			—
Benefits paid			(7.7)			(7.2)															(0.8)			(0.8)
Benefit obligation end of year			$	85.4		$	83.3														$	6.3		$	6.6
Change in plan assets
Fair value of plan assets beginning of year			$	27.4		$	30.5														$	—		$	—
Actual return on plan assets			1.1			0.6															—			—
Company contributions			9.8			11.2															0.8			0.8
Settlement			—			(6.8)															—			—
Foreign currency translation			1.2			(0.9)															—			—
Benefits paid			(7.7)			(7.2)															(0.8)			(0.8)
Fair value of plan assets end of year			$	31.8		$	27.4														$	—		$	—
Funded status
Benefit obligations in excess of the fair value of plan assets			$	(53.6)		$	(55.9)														$	(6.3)		$	(6.6)

(1) The settlement and curtailment in 2024 related to a reduction in headcount in one of our pension plans as a result of ongoing transformation initiatives.

(2) The actuarial loss in 2025 was primarily due to declines in discount rates to reflect economic conditions at December 31, 2025. The actuarial gain in 2024 was primarily due to increases in discount rates to reflect economic conditions at December 31, 2024.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

Amounts recorded in the Consolidated Balance Sheets were as follows:

			Pension plans															Other post-retirement plans
In millions			2025			2024															2025			2024
Current liabilities			$	(5.9)		$	(6.2)														$	(0.9)		$	(1.0)
Non-current liabilities			(47.7)			(49.7)															(5.4)			(5.6)
Benefit obligations in excess of the fair value of plan assets			$	(53.6)		$	(55.9)														$	(6.3)		$	(6.6)

The accumulated benefit obligation for our pension plans was $83.4 million and $82.6 million at December 31, 2025 and 2024, respectively.

Information for pension plans with an accumulated benefit obligation or projected benefit obligation in excess of plan assets as of December 31 was as follows:

			Projected benefit obligation exceeds the fair value of plan assets									Accumulated benefit obligation exceeds the fair value of plan assets
In millions			2025			2024						2025			2024
Projected benefit obligation			$	85.4		$	83.3					$	85.4		$	83.3
Fair value of plan assets			31.8			27.4						31.8			27.4
Accumulated benefit obligation			N/A			N/A						83.4			82.6

Components of net periodic benefit expense for our pension plans for the years ended December 31 were as follows:

In millions			2025			2024			2023
Service cost			$	1.4		$	1.7		$	1.7
Interest cost			3.8			3.9			4.1
Expected return on plan assets			(0.6)			(0.6)			(0.8)
Curtailment			—			(2.0)			—
Net actuarial loss (gain)			2.3			(2.9)			7.1
Net periodic benefit expense			$	6.9		$	0.1		$	12.1

Components of net periodic benefit expense and income for our other post-retirement plans for the years ended December 31, 2025, 2024 and 2023, were not material.

Assumptions

The following table provides the weighted-average assumptions used to determine benefit obligations and net periodic benefit cost as they pertain to our pension and other post-retirement plans.

			Pension plans																		Other post-retirement plans
Percentages			2025			2024			2023																		2025			2024			2023
Benefit obligation assumptions
Discount rate			4.34		%	4.83		%	4.26		%																4.79		%	5.31		%	4.84		%
Rate of compensation increase			3.74		%	3.78		%	3.70		%																N/A			N/A			N/A
Net periodic benefit expense assumptions
Discount rate			4.83		%	4.26		%	4.77		%																5.31		%	4.84		%	5.11		%
Expected long-term return on plan assets			5.42		%	4.36		%	4.76		%																N/A			N/A			N/A
Rate of compensation increase			3.78		%	3.70		%	3.80		%																N/A			N/A			N/A

Discount rates

The discount rate reflects the current rate at which the pension liabilities could be effectively settled. The discount rate was determined by matching our expected benefit payments to payments from a stream of bonds rated AA or higher available in the

Pentair plc and Subsidiaries

Notes to consolidated financial statements

marketplace. There are no known or anticipated changes in our discount rate assumptions that will impact our pension expense in 2026.

Expected rates of return

The expected rate of return is designed to be a long-term assumption that may be subject to considerable year-to-year variance from actual returns. In developing the expected long-term rate of return, we considered our historical returns, with consideration given to forecasted economic conditions, our asset allocations, input from external consultants and broader long-term market indices. Pension plan assets yielded gains of 4.01%, 1.97% and 2.82% in 2025, 2024 and 2023, respectively.

Healthcare cost trend rates

The assumed healthcare cost trend rates for other post-retirement plans as of December 31 were as follows:

			2025			2024
Healthcare cost trend rate assumed for following year			6.8		%	7.0		%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)			4.5		%	4.0		%
Year the cost trend rate reaches the ultimate trend rate			2035			2035

Pension plans assets

Objective

The primary objective of our investment strategy is to meet the pension obligation to our employees at a reasonable cost to us. This is primarily accomplished through growth of capital and safety of the funds invested.

Asset allocation

Our actual overall asset allocation for our pension plans as compared to our investment policy goals as of December 31 was as follows:

			Actual									Target
Percentages			2025			2024						2025			2024
Fixed income			67		%	70		%				68		%	71		%
Alternative			32		%	29		%				32		%	29		%
Cash			1		%	1		%				—		%	—		%

Fair value measurement

The fair values of our pension plan assets and their respective levels in the fair value hierarchy as of December 31, 2025 and December 31, 2024 were as follows:

			December 31, 2025
In millions			Level 1			Level 2			Level 3			Total
Cash and cash equivalents			$	0.3		$	—		$	—		$	0.3
Other investments			—			—			10.2			10.2
Total investments at fair value			$	0.3		$	—		$	10.2		$	10.5
Investments measured at NAV												21.3
Total												$	31.8

			December 31, 2024
In millions			Level 1			Level 2			Level 3			Total
Cash and cash equivalents			$	0.3		$	—		$	—		$	0.3
Other investments			—			—			8.0			8.0
Total investments at fair value			$	0.3		$	—		$	8.0		$	8.3
Investments measured at NAV												19.1
Total												$	27.4

Pentair plc and Subsidiaries

Notes to consolidated financial statements

Valuation methodologies used for investments measured at fair value were as follows:

• Cash and cash equivalents — Cash consists of investments in an institutional money market fund that permits daily redemption, the fair value of which is based upon the quoted price in active markets and is considered a Level 1 investment.

• Other investments — Other investments include investments in commingled funds with diversified investment strategies. Investments in commingled funds that were valued based on unobservable inputs due to liquidation restrictions were classified as Level 3.

Activity for our Level 3 pension plan assets held during the year ended December 31, 2025 was not material.

Activity for our Level 3 pension plan assets held during the year ended December 31, 2024 was as follows:

In millions			December 31, 2024
Beginning balance			$	14.2
Actual return on plan assets			0.5
Company contributions			0.7
Benefits received			0.3
Settlement			(6.8)
Foreign currency translation			(0.9)
Ending balance			$	8.0

Cash flows

Contributions

Pension contributions totaled $9.8 million and $11.2 million in 2025 and 2024, respectively. We anticipate our 2026 pension contributions to be approximately $6.5 million. The 2026 expected contributions will equal or exceed our minimum funding requirements.

Estimated future benefit payments

The following benefit payments, which reflect expected future service or payout from termination, as appropriate, are expected to be paid by the plans in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter are as follows:

In millions			Pension plans						Other post-retirement plans
2026			$	7.8					$	1.0
2027			8.2						0.9
2028			8.6						0.8
2029			8.2						0.7
2030			7.8						0.6
2031 - 2035			33.3						2.3

Savings plan

We have a 401(k) plan (the “401(k) plan”) with an employee share ownership (“ESOP”) bonus component, which covers certain union and all non-union U.S. employees who meet certain age requirements. Under the 401(k) plan, eligible U.S. employees may voluntarily contribute a percentage of their eligible compensation. We match contributions made by employees who meet certain eligibility and service requirements. The 401(k) company match contribution is a dollar-for-dollar (100%) matching contribution on up to 5% of employee eligible earnings, contributed as before-tax contributions.

Our expense for the 401(k) plan, including the ESOP, was $18.7 million, $19.7 million and $19.5 million in 2025, 2024 and 2023, respectively.

Other retirement compensation

Total other accrued retirement compensation, primarily related to deferred compensation and supplemental retirement plans, was $38.1 million and $35.7 million as of December 31, 2025 and 2024, respectively, and is included in Pension and other post-retirement compensation and benefits and Other non-current liabilities in the Consolidated Balance Sheets.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

12. Shareholders’ Equity

Authorized shares

Our authorized share capital consists of 426.0 million ordinary shares with a par value of $0.01 per share.

Share repurchases

In December 2020, the Board of Directors authorized the repurchase of our ordinary shares up to a maximum dollar limit of $750.0 million (the “2020 Authorization”). The 2020 Authorization expired on December 31, 2025. In December 2025, the Board of Directors authorized the repurchase of our ordinary shares up to a maximum dollar limit of $1.0 billion (the “2025 Authorization”). The 2025 Authorization supplemented the 2020 Authorization and expires on December 31, 2028.

During the year ended December 31, 2024, we repurchased 1.6 million of our ordinary shares for $150.0 million under the 2020 Authorization. During the year ended December 31, 2025, we repurchased 2.3 million of our ordinary shares for $225.0 million under the 2020 Authorization. As of December 31, 2025, we had $1.0 billion available for share repurchases under the 2025 Authorization.

Dividends payable

On December 15, 2025, the Board of Directors approved a regular quarterly cash dividend of $0.27 per share that was paid on February 6, 2026 to shareholders of record at the close of business on January 23, 2026. This dividend reflects an 8 percent increase in the Company’s regular cash dividend rate. The balance of dividends payable included in Other current liabilities on our Consolidated Balance Sheets was $44.1 million at December 31, 2025. Dividends paid per ordinary share were $1.00, $0.92 and $0.88 for the years ended December 31, 2025, 2024 and 2023, respectively.

13. Share Plans

Share-based compensation expense

Total share-based compensation expense for 2025, 2024 and 2023 was as follows:

			December 31
In millions			2025			2024			2023
Stock options			$	4.7		$	5.3		$	4.3
Restricted stock units			14.7			16.1			15.0
Performance share units			17.6			18.3			9.8
Total share-based compensation expense			$	37.0		$	39.7		$	29.1

Share incentive plans

In May 2020, the Pentair plc 2020 Share and Incentive Plan (“2020 Share Plan”) was approved during the Annual General Meeting of Shareholders. The Pentair plc 2012 Stock and Incentive Plan (“2012 Stock Plan”) terminated upon the approval of the 2020 Share Plan, although awards outstanding under the 2012 Stock Plan continue in effect. Beginning May 5, 2020, all share-based compensation grants were made under the 2020 Share Plan.

The 2020 Share Plan authorizes the issuance of 3.3 million of our ordinary shares, plus the number of shares reserved under the 2012 Stock Plan that were not the subject of outstanding awards as of the date the 2020 Share Plan became effective, which was 2.5 million shares, plus certain shares that would become available under the 2012 Stock Plan if it had remained in effect. The shares may be issued as new shares or from shares held in treasury. Our practice is to settle equity-based awards by issuing new shares. The 2020 Share Plan terminates on the date all shares reserved for issuance have been issued. The 2020 Share Plan allows for the granting to our employees, consultants and directors of stock options, stock appreciation rights, performance share units, restricted shares, restricted stock units, deferred stock rights, incentive awards, dividend equivalent units and other equity-based awards.

The 2020 Share Plan is administered by our compensation committee (the “Committee”), which is made up of independent members of our Board of Directors. Employees eligible to receive awards under the 2020 Share Plan are managerial, administrative or professional employees. The Committee has the authority to select the recipients of awards, determine the type and size of awards, establish certain terms and conditions of award grants and take certain other actions as permitted under the 2020 Share Plan. The 2020 Share Plan prohibits the Committee from re-pricing awards or canceling and reissuing awards at lower prices.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

Non-qualified and incentive stock options

Under the 2020 Share Plan, we may grant stock options to any eligible employee with an exercise price equal to the market value of the shares on the dates the options were granted. Options generally vest one-third each year over a period of three years commencing on the grant date and expire 10 years after the grant date.

Restricted shares and restricted stock units

Under the 2020 Share Plan, eligible employees may be awarded restricted shares or restricted stock units of our common stock. Restricted shares and restricted stock units generally vest one-third each year over a period of three years commencing on the grant date, subject to continuous employment and certain other conditions. Restricted shares and restricted stock units are valued at market value on the date of grant and are expensed over the vesting period.

Stock appreciation rights, performance shares and performance units

Under the 2020 Share Plan, the Committee is permitted to issue these awards which are generally contingent on the achievement of predetermined performance goals over a vesting period of three years. The Committee has the ability to adjust performance goals or modify the manner of measuring or evaluating a performance goal using its discretion. PSUs are granted to certain employees that vest based on the satisfaction of a service period of three years and the achievement of certain performance metrics over that same period. Upon vesting, PSU holders receive dividends that accumulate during the vesting period. The fair value of these PSUs is determined based on the closing market price of the Company’s ordinary shares at the date of grant. Compensation expense is recognized over the period an employee is required to provide service based on the estimated vesting of the PSUs granted. The estimated vesting of the PSUs is based on the probability of achieving certain performance metrics during the vesting period.

Stock options

The following table summarizes stock option activity under all plans for the year ended December 31, 2025:

Shares and intrinsic value in millions			Number of shares			Weighted- average exercise price			Weighted- average remaining contractual life (years)			Aggregate intrinsic value
Outstanding as of January 1, 2025			1.7			$	50.35
Granted			0.1			100.37
Exercised			(0.5)			43.73
Outstanding as of December 31, 2025			1.3			$	57.48		5.6			$	60.0
Options exercisable as of December 31, 2025			0.9			$	51.43		4.7			$	49.3
Options expected to vest as of December 31, 2025			0.4			$	73.37		7.8			$	10.7

Fair value of options granted

The weighted average grant date fair value of options granted under the 2020 Share Plan in 2025, 2024 and 2023 was estimated to be $36.72, $24.84 and $14.03 per share, respectively. The total intrinsic value of options that were exercised during 2025, 2024 and 2023 was $29.8 million, $32.0 million and $5.3 million, respectively. At December 31, 2025, the total unrecognized compensation cost related to stock options was $2.2 million. This cost is expected to be recognized over a weighted average period of 1.8 years.

We estimated the fair value of each stock option award issued in the annual share-based compensation grant using a Black-Scholes option pricing model, modified for dividends and using the following assumptions:

			December 31
			2025						2024									2023
Risk-free interest rate			4.12		%				4.44		%							4.00		%
Expected dividend yield			0.98		%				1.43		%							2.02		%
Expected share price volatility			31.10		%				30.90		%							30.40		%
Expected term (years)			6.9						6.5									6.1

These estimates require us to make assumptions based on historical results, observance of trends in our share price, changes in option exercise behavior, future expectations and other relevant factors. If other assumptions had been used, share-based compensation expense, as calculated and recorded under the accounting guidance, could have been affected.

Pentair plc and Subsidiaries

Notes to consolidated financial statements

We based the expected life assumption on historical experience as well as the terms and vesting periods of the options granted. For purposes of determining expected share price volatility, we considered a rolling average of historical volatility measured over a period approximately equal to the expected option term. The risk-free rate for periods that coincide with the expected life of the options is based on the U.S. Treasury Department yield curve in effect at the time of grant.

Cash received from option exercises for the years ended December 31, 2025, 2024 and 2023 was $14.1 million, $28.5 million and $16.0 million, respectively. The tax benefit related to options exercised was $2.6 million, $6.7 million and $1.0 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Restricted stock units

The following table summarizes restricted stock unit activity under all plans for the year ended December 31, 2025:

Shares in millions			Number of shares			Weighted average grant date fair value
Outstanding as of January 1, 2025			0.5			$	62.93
Granted			0.2			94.37
Vested			(0.3)			62.94
Outstanding as of December 31, 2025			0.4			$	77.11

As of December 31, 2025, there was $21.5 million of unrecognized compensation cost related to restricted share compensation arrangements granted under the 2020 Plan and previous plans. That cost is expected to be recognized over a weighted-average period of 0.8 years. The total fair value of shares vested during the years ended December 31, 2025, 2024 and 2023, was $15.9 million, $14.9 million and $17.6 million, respectively. The tax benefit related to restricted stock units vested was $3.4 million for the years ended December 31, 2025 and 2024, and $2.7 million for the year ended December 31, 2023.

Performance share units

The following table summarizes performance share unit activity under all plans for the year ended December 31, 2025:

Shares in millions			Number of shares			Weighted average grant date fair value
Outstanding as of January 1, 2025			0.4			$	59.68
Granted			0.1			99.19
Vested			(0.1)			67.14
Outstanding as of December 31, 2025			0.4			$	68.26

The expense recognized each period is dependent upon our estimate of the number of shares that will ultimately be issued. As of December 31, 2025, there was $14.8 million of unrecognized compensation cost related to performance share compensation arrangements granted under the 2020 Plan and previous plans. That cost is expected to be recognized over a weighted-average period of 1.0 year. The tax benefit related to performance share units was $1.0 million for the year ended December 31, 2025, and $0.9 million for the years ended December 31, 2024 and 2023.

14. Segment Information

At Pentair, our chief operating decision maker (“CODM”) is our President and Chief Executive Officer. We define our reportable segments on the basis of the way in which internally reported financial information is regularly reviewed by the CODM to analyze financial performance, make decisions and allocate resources. The discussion and figures below are reporting on historical prior periods and reflect our reportable segment composition as of and prior to December 31, 2025. Based on this, we classify our operations into the following reportable segments:

• Flow** — The focus of this segment is to deliver water where it is needed, when it is needed, more efficiently and to transform waste into value. This segment designs, manufactures and sells a variety of fluid treatment and pump products and systems, including pressure vessels, gas recovery solutions, membrane bioreactors, wastewater reuse systems and advanced membrane filtration, separation systems, specialty insertion valves, line stop fittings and installation equipment, water disposal pumps, water supply pumps, fluid transfer pumps, turbine pumps, solid handling pumps, and agricultural spray nozzles, while serving the global residential, commercial and industrial markets. These products and systems are used in a range of applications, including fluid delivery, ion exchange, desalination, food and

Pentair plc and Subsidiaries

Notes to consolidated financial statements

beverage, separation technologies for the oil and gas industry, residential and municipal wells, water treatment, wastewater solids handling, pressure boosting, circulation and transfer, fire suppression, flood control, agricultural irrigation and crop spray.

• Water Solutions** — The focus of this segment is to provide great tasting, higher-quality water and ice while helping people use water more productively. This segment designs, manufactures and sells commercial and residential water treatment products and systems including pressure tanks, control valves, activated carbon products, commercial ice machines, conventional filtration products, and point-of-entry and point-of-use water treatment systems. These water treatment products and systems are for use in residential whole home water filtration, drinking water filtration and water softening solutions in addition to commercial total water management and filtration in foodservice operations.

• Pool** — The focus of this segment is to provide innovative, energy-efficient pool solutions to help people more sustainably enjoy water. This segment designs, manufactures and sells a complete line of energy-efficient residential and commercial pool equipment and accessories including pumps, filters, heaters, lights, automatic controls, chlorinators, automatic cleaners, maintenance equipment and pool accessories. Applications for our pool products include residential and commercial pool maintenance, pool repair, renovation, service, construction and aquaculture solutions.

Our CODM evaluates our reportable segments’ performance based on net sales and reportable segment income and uses certain ratios, particularly return on sales, to measure their performance. Additionally, these measures are used to evaluate reinvestment of profits into our reportable segments or into other parts of the Company, such as for acquisitions, debt repayments, dividend payments or share repurchases. These results are not necessarily indicative of the results of operations that would have occurred had each segment been an independent, stand-alone entity during the periods presented. Reportable segment income represents operating income of each reportable segment inclusive of equity income of unconsolidated subsidiaries and exclusive of intangible amortization, certain acquisition related expenses, costs of restructuring and transformation activities, impairments, legal accrual adjustments and settlements and other unusual non-operating items. “Corporate and other” activity primarily consists of corporate expenses not allocated to the segments, including executive office, board of directors, and centrally-managed corporate functional or shared service costs related to finance, human resources, communications and corporate development. These activities do not meet the criteria for a stand-alone reportable segment under accounting standards codification (“ASC”) 280. The accounting policies for our reportable segments are consistent with those described in Note 1.

Financial information by reportable segment as well as a reconciliation of reportable segment income to consolidated income from continuing operations before income taxes is as follows:

			2025			2024			2023						2025			2024			2023						2025			2024			2023
In millions			Identifiable assets (1)												Capital expenditures												Depreciation
Flow			$	2,000.5		$	1,590.7		$	1,709.7					$	21.5		$	20.1		$	19.6					$	21.0		$	21.4		$	21.1
Water Solutions			2,540.6			2,613.5			2,695.2						15.4			22.3			23.0						15.8			17.1			18.1
Pool			1,884.3			1,801.3			1,679.8						24.5			17.1			17.3						14.3			13.1			11.4
Reportable segment total			6,425.4			6,005.5			6,084.7						61.4			59.5			59.9						51.1			51.6			50.6
Corporate and other			443.4			441.0			478.6						7.4			14.9			16.1						8.5			8.7			8.9
Consolidated			$	6,868.8		$	6,446.5		$	6,563.3					$	68.8		$	74.4		$	76.0					$	59.6		$	60.3		$	59.5

(1) All cash and cash equivalents are included in “Corporate and other.”

Pentair plc and Subsidiaries

Notes to consolidated financial statements

2025
In millions			Flow			Water Solutions			Pool			Total
Net sales			$	1,553.6		$	1,062.1		$	1,558.8		$	4,174.5
Reconciliation of consolidated net sales
Corporate and other												1.5
Total consolidated net sales (1)												$	4,176.0
Cost of goods sold (2)(4)			(958.7)			(647.9)			(857.1)
Operating expenses (2)(3)(4)			(232.8)			(160.3)			(174.6)
Reportable segment income			$	362.1		$	253.9		$	527.1		$	1,143.1
Corporate and other												(89.6)
Restructuring and other												(31.3)
Transformation costs												(40.8)
Pension and other post-retirement mark-to-market loss												(2.4)
Asset impairment and write-offs												(49.1)
Loss on sale of business												(26.3)
Deal-related costs and expenses												(4.1)
Legal accrual adjustments and settlements												(11.6)
Intangible amortization												(58.1)
Interest expense, net												(69.4)
Other expense												(3.9)
Income from continuing operations before income taxes												$	756.5

2024
In millions			Flow			Water Solutions			Pool			Total
Net sales			$	1,514.0		$	1,131.0		$	1,436.1		$	4,081.1
Reconciliation of consolidated net sales
Corporate and other												1.7
Total consolidated net sales (1)												$	4,082.8
Cost of goods sold (2)(4)			(965.1)			(706.8)			(799.3)
Operating expenses (2)(3)(4)			(230.8)			(169.1)			(160.3)
Reportable segment income			$	318.1		$	255.1		$	476.5		$	1,049.7
Corporate and other												(90.5)
Restructuring and other												(37.0)
Transformation costs												(52.1)
Pension and other post-retirement mark-to-market gain												5.3
Asset impairment and write-offs												(17.6)
Legal accrual adjustments and settlements												7.5
Intangible amortization												(54.3)
Interest expense, net												(88.6)
Other expense												(3.5)
Income from continuing operations before income taxes												$	718.9

Pentair plc and Subsidiaries

Notes to consolidated financial statements

2023
In millions			Flow			Water Solutions			Pool			Total
Net sales			$	1,582.1		$	1,177.2		$	1,343.6		$	4,102.9
Reconciliation of consolidated net sales
Corporate and other												1.6
Total consolidated net sales (1)												$	4,104.5
Cost of goods sold (2)(4)			(1,054.7)			(752.5)			(775.2)
Operating expenses (2)(3)(4)			(245.1)			(177.1)			(151.4)
Reportable segment income			$	282.3		$	247.6		$	417.0		$	946.9
Corporate and other												(91.8)
Restructuring and other												(3.4)
Transformation costs												(44.3)
Pension and other post-retirement mark-to-market loss												(6.1)
Asset impairment and write-offs												(7.9)
Legal accrual adjustments and settlements												(2.2)
Intangible amortization												(55.3)
Interest expense, net												(118.3)
Other income												1.3
Income from continuing operations before income taxes												$	618.9

(1) One customer in the Pool business represented approximately 18% of our consolidated net sales in 2025, and 15% in both 2024 and 2023.

(2) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM, which includes certain corporate overhead allocations directly attributable to each of the segments.

(3) Operating expenses include selling, general, administrative, research and development costs which primarily consist of non-manufacturing employee compensation, non-manufacturing overhead and professional service costs as well as depreciation expense.

(4) These costs exclude certain expenses reported in the Consolidated Statements of Operations and Comprehensive Income, including costs that are reflected in “Corporate and other” and expenses excluded from reportable segment income as defined above.

15. Commitments and Contingencies

Legal proceedings

We have been, and in the future may be, made parties to a number of actions filed or have been, and in the future may be, given notice of potential claims relating to the conduct of our business, including those relating to commercial, regulatory or contractual disputes with suppliers, authorities, customers or parties to acquisitions and divestitures, intellectual property matters, environmental, asbestos, safety and health matters, product liability, the use or installation of our products, consumer matters, and employment and labor matters.

While we believe that a material impact on our consolidated financial position, results of operations or cash flows from any such future claims or potential claims is unlikely, given the inherent uncertainty of litigation, a remote possibility exists that a future adverse ruling or unfavorable development could result in future charges that could have a material adverse impact. We do and will continue to periodically reexamine our estimates of probable liabilities and any associated expenses and receivables and make appropriate adjustments to such estimates based on experience and developments in litigation and applicable accounting rules. As a result, the current estimates of the potential impact on our consolidated financial position, results of operations and cash flows for the proceedings and claims described in the notes to our consolidated financial statements could change in the future.

Environmental matters

We have been named as defendant, target or a potentially responsible party in environmental clean-ups relating to our current or former business units. Accruals for environmental matters are recorded on a site-by-site basis when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, based on current law and existing technologies. It can be difficult to estimate reliably the final costs of investigation and remediation due to various factors. In our opinion, the amounts accrued are appropriate based on facts and circumstances as currently known. As of December 31, 2025 and 2024, our recorded reserves for environmental matters were not material.

Product liability claims

We are subject to various product liability lawsuits and personal injury claims. A substantial number of these lawsuits and claims are insured and accrued for by Penwald, our captive insurance subsidiary. Penwald records a liability for these claims based on actuarial projections of ultimate losses. For all other claims, accruals covering the claims are recorded, on an undiscounted basis, when it is probable that a liability has been incurred and the amount of the liability can be reasonably

Pentair plc and Subsidiaries

Notes to consolidated financial statements

estimated based on existing information. The accruals are adjusted periodically as additional information becomes available. We have not experienced significant unfavorable trends in either the severity or frequency of product liability lawsuits or personal injury claims.

Leases

Our lease portfolio principally consists of operating leases related to facilities, machinery, equipment and vehicles. Our accounting for lease terms does not include options to extend or terminate the lease until we are reasonably certain that we will exercise that option. Operating lease cost for lease payments is recognized on a straight-line basis over the lease term and principally consists of fixed payments for base rent.

These operating lease right-of-use (“ROU”) assets are included in Other non-current assets on the Consolidated Balance Sheets, and represent our right to use the underlying asset for the lease term. Our obligation to make lease payments arising from the lease are included in Other current liabilities and Other non-current liabilities on the Consolidated Balance Sheets. Lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As we cannot readily determine the rate implicit in the lease, we use our incremental borrowing rate, determined by country of lease origin, based on the anticipated lease term at the commencement date in determining the present value of lease payments. The ROU asset also excludes any accrued lease payments and unamortized lease incentives.

For measurement and classification of lease agreements, we group lease and non-lease components into a single lease component for all underlying asset classes. Accordingly, all costs associated with a lease contract are accounted for as one lease cost.

The components of lease cost were as follows:

			December 31
In millions			2025			2024
Operating lease cost			$	53.5		$	50.3
Sublease income			(0.3)			(0.9)
Total lease cost			$	53.2		$	49.4

Supplemental cash flow information related to leases was as follows:

			December 31
In millions			2025			2024
Operating cash flows from operating leases			$	34.3		$	36.3
Right-of-use assets obtained in exchange for lease obligations			$	21.5		$	22.4

Other information related to leases was as follows:

			December 31
			2025			2024
Weighted-average remaining lease term of operating leases (years)			5.6			6.0
Weighted-average discount rate of operating leases			5.7		%	5.6		%

Future minimum lease commitments under non-cancelable operating leases as of December 31, 2025 were as follows:

In millions
2026			$	35.0
2027			28.4
2028			23.4
2029			18.3
2030			11.8
Thereafter			31.3
Total lease payments			148.2
Less: imputed interest			(20.9)
Total			$	127.3

Pentair plc and Subsidiaries

Notes to consolidated financial statements

Warranties and guarantees

In connection with the disposition of our businesses or product lines, we may agree to indemnify purchasers for various potential liabilities relating to the sold business, such as pre-closing tax, product liability, warranty, environmental, or other obligations. The subject matter, amounts and duration of any such indemnification obligations vary for each type of liability indemnified and may vary widely from transaction to transaction.

Generally, the maximum obligation under such indemnifications is not explicitly stated and as a result, the overall amount of these obligations cannot be reasonably estimated. Historically, we have not made significant payments for these indemnifications. We believe that if we were to incur a loss in any of these matters, the loss would not have a material effect on our financial position, results of operations or cash flows.

We recognize, at the inception of a guarantee, a liability for the fair value of the obligation undertaken in issuing the guarantee. In connection with the disposition of the Valves & Controls business, we agreed to indemnify Emerson Electric Co. for certain pre-closing tax liabilities. We have recorded a liability representing the fair value of our expected future obligation for this matter.

We provide service and warranty policies on our products. Liability under service and warranty policies is based upon a review of historical warranty and service claim experience. Adjustments are made to accruals as claim data and historical experience warrant.

The changes in the carrying amount of service and product warranties from continuing operations were as follows:

			Years ended December 31
In millions			2025			2024			2023
Beginning balance			$	67.2		$	65.0		$	63.1
Service and product warranty provision			85.8			87.0			90.0
Payments			(84.4)			(84.2)			(88.2)
Acquisitions			0.2			—			—
Foreign currency translation			1.0			(0.6)			0.1
Ending balance			$	69.8		$	67.2		$	65.0

Stand-by letters of credit, bank guarantees and bonds

In certain situations, Tyco International Ltd., Pentair Ltd.’s former parent company (“Tyco”), guaranteed performance by the flow control business of Pentair Ltd. (“Flow Control”) to third parties or provided financial guarantees for financial commitments of Flow Control. In situations where Flow Control and Tyco were unable to obtain a release from these guarantees in connection with the spin-off of Flow Control from Tyco, we will indemnify Tyco for any losses it suffers as a result of such guarantees.

In the ordinary course of business, we are required to commit to bonds, letters of credit and bank guarantees that require payments to our customers for any non-performance. The outstanding face value of these instruments fluctuates with the value of our projects in process and in our backlog. In addition, we issue financial stand-by letters of credit primarily to secure our performance to third parties under self-insurance programs.

As of December 31, 2025 and 2024, the outstanding value of bonds, letters of credit and bank guarantees totaled $115.0 million and $102.1 million, respectively.

Pentair plc and Subsidiaries

Notes to consolidated financial statements