filings.toolsItem 1. Unaudited Financial Statements
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Item 1. Unaudited Financial Statements
REVVITY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 28, 2025 | September 29, 2024 | September 28, 2025 | September 29, 2024 | ||||||||||||||||||||
| (In thousands, except per share data) | |||||||||||||||||||||||
| Product revenue | $ | 573,225 | $ | 579,997 | $ | 1,742,983 | $ | 1,717,927 | |||||||||||||||
| Service revenue | 125,724 | 104,052 | 341,012 | 307,727 | |||||||||||||||||||
| Total revenue | 698,949 | 684,049 | 2,083,995 | 2,025,654 | |||||||||||||||||||
| Cost of product revenue | 280,731 | 256,551 | 813,878 | 770,196 | |||||||||||||||||||
| Cost of service revenue | 43,614 | 42,682 | 127,411 | 130,089 | |||||||||||||||||||
| Total cost of revenue | 324,345 | 299,233 | 941,289 | 900,285 | |||||||||||||||||||
| Selling, general and administrative expenses | 241,911 | 237,521 | 740,156 | 749,742 | |||||||||||||||||||
| Research and development expenses | 50,797 | 49,144 | 157,664 | 147,636 | |||||||||||||||||||
| Operating income from continuing operations | 81,896 | 98,151 | 244,886 | 227,991 | |||||||||||||||||||
| Interest and other expense (income), net | 26,211 | (2,206) | 68,169 | 6,423 | |||||||||||||||||||
| Income from continuing operations before income taxes | 55,685 | 100,357 | 176,717 | 221,568 | |||||||||||||||||||
| Provision for income taxes | 8,464 | 6,971 | 32,605 | 26,880 | |||||||||||||||||||
| Income from continuing operations | 47,221 | 93,386 | 144,112 | 194,688 | |||||||||||||||||||
| (Loss) income from discontinued operations | (569) | 981 | (1,275) | (18,948) | |||||||||||||||||||
| Net income | $ | 46,652 | $ | 94,367 | $ | 142,837 | $ | 175,740 | |||||||||||||||
| Basic earnings per share: | |||||||||||||||||||||||
| Income from continuing operations | $ | 0.41 | $ | 0.76 | $ | 1.22 | $ | 1.58 | |||||||||||||||
| (Loss) income from discontinued operations | (0.01) | 0.01 | (0.01) | (0.15) | |||||||||||||||||||
| Net income | $ | 0.40 | $ | 0.77 | $ | 1.21 | $ | 1.43 | |||||||||||||||
| Diluted earnings per share: | |||||||||||||||||||||||
| Income from continuing operations | $ | 0.41 | $ | 0.76 | $ | 1.22 | $ | 1.58 | |||||||||||||||
| (Loss) income from discontinued operations | (0.01) | 0.01 | (0.01) | (0.15) | |||||||||||||||||||
| Net income | $ | 0.40 | $ | 0.77 | $ | 1.21 | $ | 1.42 | |||||||||||||||
| Weighted average shares of common stock outstanding: | |||||||||||||||||||||||
| Basic | 115,411 | 122,810 | 117,686 | 123,198 | |||||||||||||||||||
| Diluted | 115,463 | 123,026 | 117,735 | 123,336 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
REVVITY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 28, 2025 | September 29, 2024 | September 28, 2025 | September 29, 2024 | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Net income | $ | 46,652 | $ | 94,367 | $ | 142,837 | $ | 175,740 | |||||||||||||||
| Other comprehensive (loss) income: | |||||||||||||||||||||||
| Foreign currency translation adjustments, net of income taxes | (22,322) | 109,774 | 216,279 | 44,130 | |||||||||||||||||||
| Unrealized (loss) gain on securities, net of income taxes | (6) | 245 | 21 | 647 | |||||||||||||||||||
| Other comprehensive (loss) income | (22,328) | 110,019 | 216,300 | 44,777 | |||||||||||||||||||
| Comprehensive income | $ | 24,324 | $ | 204,386 | $ | 359,137 | $ | 220,517 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
REVVITY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| September 28, 2025 | December 29, 2024 | ||||||||||
| (In thousands, except share and per share data) | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 931,386 | $ | 1,163,396 | |||||||
| Accounts receivable, net | 680,259 | 632,400 | |||||||||
| Inventories, net | 379,917 | 367,587 | |||||||||
| Other current assets | 152,226 | 186,225 | |||||||||
| Total current assets | 2,143,788 | 2,349,608 | |||||||||
| Property, plant and equipment, net | 497,088 | 482,217 | |||||||||
| Operating lease right-of-use assets, net | 171,078 | 167,716 | |||||||||
| Intangible assets, net | 2,425,926 | 2,640,921 | |||||||||
| Goodwill | 6,600,631 | 6,463,619 | |||||||||
| Other assets, net | 300,441 | 288,397 | |||||||||
| Total assets | $ | 12,138,952 | $ | 12,392,478 | |||||||
| Current liabilities: | |||||||||||
| Current portion of long-term debt | $ | 583,844 | $ | 242 | |||||||
| Accounts payable | 175,800 | 167,463 | |||||||||
| Accrued expenses and other current liabilities | 463,099 | 485,395 | |||||||||
| Total current liabilities | 1,222,743 | 653,100 | |||||||||
| Long-term debt | 2,630,693 | 3,150,476 | |||||||||
| Deferred taxes and other long-term liabilities | 755,155 | 770,523 | |||||||||
| Operating lease liabilities | 154,465 | 151,505 | |||||||||
| Total liabilities | 4,763,056 | 4,725,604 | |||||||||
| Commitments and contingencies (see Note 13) | |||||||||||
| Stockholders’ equity: | |||||||||||
| Preferred stock—$1 par value per share, authorized 1,000,000 shares; none issued or outstanding | — | — | |||||||||
| Common stock—$1 par value per share, authorized 300,000,000 shares; issued and outstanding 114,030,000 shares and 120,646,000 shares at September 28, 2025 and December 29, 2024, respectively | 114,030 | 120,646 | |||||||||
| Capital in excess of par value | 1,477,890 | 2,097,110 | |||||||||
| Retained earnings | 5,963,781 | 5,845,223 | |||||||||
| Accumulated other comprehensive loss | (179,805) | (396,105) | |||||||||
| Total stockholders’ equity | 7,375,896 | 7,666,874 | |||||||||
| Total liabilities and stockholders’ equity | $ | 12,138,952 | $ | 12,392,478 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
REVVITY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)
| For the Nine-Month Period Ended September 28, 2025 | |||||||||||||||||||||||||||||||||||
| Common Stock Shares | Common Stock Amount | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||||||||||
| Balance, December 29, 2024 | 120,646 | $ | 120,646 | $ | 2,097,110 | $ | 5,845,223 | $ | (396,105) | $ | 7,666,874 | ||||||||||||||||||||||||
| Net income | — | — | — | 42,237 | — | 42,237 | |||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | 79,654 | 79,654 | |||||||||||||||||||||||||||||
| Dividends ($0.07 per common share, see Note 9) | — | — | — | (8,243) | — | (8,243) | |||||||||||||||||||||||||||||
| Exercise of employee stock options | 32 | 32 | 2,600 | — | — | 2,632 | |||||||||||||||||||||||||||||
| Issuance of common stock for employee stock purchase plans | 12 | 12 | 1,260 | — | — | 1,272 | |||||||||||||||||||||||||||||
| Purchases of common stock | (1,356) | (1,356) | (153,631) | — | — | (154,987) | |||||||||||||||||||||||||||||
| Issuance of common stock for long-term incentive program | 75 | 75 | 5,524 | — | — | 5,599 | |||||||||||||||||||||||||||||
| Stock compensation | — | — | 2,092 | — | — | 2,092 | |||||||||||||||||||||||||||||
| Balance, March 30, 2025 | 119,409 | $ | 119,409 | $ | 1,954,955 | $ | 5,879,217 | $ | (316,451) | $ | 7,637,130 | ||||||||||||||||||||||||
| Net income | — | — | — | 53,948 | — | 53,948 | |||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | 158,974 | 158,974 | |||||||||||||||||||||||||||||
| Dividends ($0.07 per common share, see Note 9) | — | — | — | (8,067) | — | (8,067) | |||||||||||||||||||||||||||||
| Purchases of common stock | (3,104) | (3,104) | (292,928) | — | — | (296,032) | |||||||||||||||||||||||||||||
| Issuance of common stock for long-term incentive program | 26 | 26 | 7,918 | — | — | 7,944 | |||||||||||||||||||||||||||||
| Stock compensation | — | — | 2,271 | — | — | 2,271 | |||||||||||||||||||||||||||||
| Balance, June 29, 2025 | 116,331 | $ | 116,331 | $ | 1,672,216 | $ | 5,925,098 | $ | (157,477) | $ | 7,556,168 | ||||||||||||||||||||||||
| Net income | — | — | — | 46,652 | — | 46,652 | |||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | (22,328) | (22,328) | |||||||||||||||||||||||||||||
| Dividends ($0.07 per common share, see Note 9) | — | — | — | (7,969) | — | (7,969) | |||||||||||||||||||||||||||||
| Issuance of common stock for employee stock purchase plans | 15 | 15 | 1,374 | — | — | 1,389 | |||||||||||||||||||||||||||||
| Purchases of common stock | (2,324) | (2,324) | (204,760) | — | — | (207,084) | |||||||||||||||||||||||||||||
| Issuance of common stock for long-term incentive program | 8 | 8 | 6,708 | — | — | 6,716 | |||||||||||||||||||||||||||||
| Stock compensation | — | — | 2,352 | — | — | 2,352 | |||||||||||||||||||||||||||||
| Balance, September 28, 2025 | 114,030 | $ | 114,030 | $ | 1,477,890 | $ | 5,963,781 | $ | (179,805) | $ | 7,375,896 |
| For the Nine-Month Period Ended September 29, 2024 | |||||||||||||||||||||||||||||||||||
| Common Stock Shares | Common Stock Amount | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||||||||||
| Balance, December 31, 2023 | 123,426 | $ | 123,426 | $ | 2,416,793 | $ | 5,609,212 | $ | (276,692) | $ | 7,872,739 | ||||||||||||||||||||||||
| Net income | — | — | — | 26,013 | — | 26,013 | |||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | (48,662) | (48,662) | |||||||||||||||||||||||||||||
| Dividends ($0.07 per common share, see Note 9) | — | — | — | (8,645) | — | (8,645) | |||||||||||||||||||||||||||||
| Exercise of employee stock options | 75 | 75 | 4,036 | — | — | 4,111 | |||||||||||||||||||||||||||||
| Purchases of common stock | (103) | (103) | (10,653) | — | — | (10,756) | |||||||||||||||||||||||||||||
| Issuance of common stock for long-term incentive program | 94 | 94 | 9,041 | — | — | 9,135 | |||||||||||||||||||||||||||||
| Stock compensation | — | — | 2,561 | — | — | 2,561 | |||||||||||||||||||||||||||||
| Balance, March 31, 2024 | 123,492 | $ | 123,492 | $ | 2,421,778 | $ | 5,626,580 | $ | (325,354) | $ | 7,846,496 | ||||||||||||||||||||||||
| Net income | — | — | — | 55,360 | — | 55,360 | |||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | (16,580) | (16,580) | |||||||||||||||||||||||||||||
| Dividends ($0.07 per common share, see Note 9) | — | — | — | (8,643) | — | (8,643) | |||||||||||||||||||||||||||||
| Exercise of employee stock options | 22 | 22 | 1,837 | — | — | 1,859 | |||||||||||||||||||||||||||||
| Issuance of common stock for employee stock purchase plans | 14 | 14 | 1,414 | — | — | 1,428 | |||||||||||||||||||||||||||||
| Purchases of common stock | (196) | (196) | (19,943) | — | — | (20,139) | |||||||||||||||||||||||||||||
| Issuance of common stock for long-term incentive program | 36 | 36 | 8,030 | — | — | 8,066 | |||||||||||||||||||||||||||||
| Stock compensation | — | — | 2,467 | — | — | 2,467 | |||||||||||||||||||||||||||||
| Balance, June 30, 2024 | 123,368 | $ | 123,368 | $ | 2,415,583 | $ | 5,673,297 | $ | (341,934) | $ | 7,870,314 | ||||||||||||||||||||||||
| Net income | — | — | — | 94,367 | — | 94,367 | |||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | 110,019 | 110,019 | |||||||||||||||||||||||||||||
| Dividends ($0.07 per common share, see Note 9) | — | — | — | (8,544) | — | (8,544) | |||||||||||||||||||||||||||||
| Exercise of employee stock options | 2 | 2 | 139 | — | — | 141 | |||||||||||||||||||||||||||||
| Issuance of common stock for employee stock purchase plans | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| Purchases of common stock | (1,285) | (1,285) | (153,833) | — | — | (155,118) | |||||||||||||||||||||||||||||
| Issuance of common stock for long-term incentive program | 6 | 6 | 7,871 | — | — | 7,877 | |||||||||||||||||||||||||||||
| Stock compensation | — | — | 2,645 | — | — | 2,645 | |||||||||||||||||||||||||||||
| Balance, September 29, 2024 | 122,091 | $ | 122,091 | $ | 2,272,405 | $ | 5,759,120 | $ | (231,915) | $ | 7,921,701 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
REVVITY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Nine Months Ended | |||||||||||
| September 28, 2025 | September 29, 2024 | ||||||||||
| (In thousands) | |||||||||||
| Operating activities: | |||||||||||
| Net income | $ | 142,837 | $ | 175,740 | |||||||
| Loss from discontinued operations, net of income taxes | 1,275 | 18,948 | |||||||||
| Income from continuing operations | 144,112 | 194,688 | |||||||||
| Adjustments to reconcile income from continuing operations to net cash provided by continuing operations: | |||||||||||
| Stock-based compensation | 26,918 | 32,756 | |||||||||
| Restructuring and other costs, net | 24,368 | 22,119 | |||||||||
| Depreciation and amortization | 302,261 | 322,816 | |||||||||
| Change in fair value of contingent consideration | (59) | 6,006 | |||||||||
| Amortization of deferred debt financing costs and accretion of discounts | 3,560 | 5,051 | |||||||||
| Change in fair value of investments | 3,484 | (13,975) | |||||||||
| Unrealized foreign exchange loss (gain) | 222 | (1,063) | |||||||||
| Changes in assets and liabilities which provided (used) cash: | |||||||||||
| Accounts receivable, net | (41,643) | 33,291 | |||||||||
| Inventories | 12,493 | 26,817 | |||||||||
| Accounts payable | 270 | (24,782) | |||||||||
| Accrued expenses and other | (68,990) | (114,236) | |||||||||
| Net cash provided by operating activities of continuing operations | 406,996 | 489,488 | |||||||||
| Net cash used in operating activities of discontinued operations | (6,023) | (35,419) | |||||||||
| Net cash provided by operating activities | 400,973 | 454,069 | |||||||||
| Investing activities: | |||||||||||
| Capital expenditures | (53,351) | (62,194) | |||||||||
| Purchases of investments and notes receivables | (29) | (4,337) | |||||||||
| Proceeds from investments and notes receivables | — | 2,500 | |||||||||
| Proceeds from marketable securities | — | 710,000 | |||||||||
| Proceeds from disposition of businesses and assets | 229 | — | |||||||||
| Net cash (used in) provided by investing activities of continuing operations | (53,151) | 645,969 | |||||||||
| Net cash provided by investing activities of discontinued operations | 56,250 | 147,522 | |||||||||
| Net cash provided by investing activities | 3,099 | 793,491 | |||||||||
| Financing activities: | |||||||||||
| Payments of senior unsecured notes | — | (711,479) | |||||||||
| Payments of debt financing issuance costs | (2,474) | — | |||||||||
| Payments of other credit facilities | (158) | (10,771) | |||||||||
| Payments for acquisition-related contingent consideration | (3,838) | (8,832) | |||||||||
| Proceeds from issuance of common stock under stock plans | 2,632 | 6,173 | |||||||||
| Purchases of common stock | (652,530) | (184,421) | |||||||||
| Dividends paid | (24,845) | (25,915) | |||||||||
| Net cash used in financing activities | (681,213) | (935,245) | |||||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | 45,264 | 4,120 |
| Net (decrease) increase in cash, cash equivalents and restricted cash | (231,877) | 316,435 | |||||||||
| Cash, cash equivalents and restricted cash at beginning of period | 1,164,452 | 914,373 | |||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 932,575 | $ | 1,230,808 | |||||||
| Supplemental disclosures of cash flow information | |||||||||||
| Reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total shown in the condensed consolidated statements of cash flows: | |||||||||||
| Cash and cash equivalents | $ | 931,386 | $ | 1,229,778 | |||||||
| Restricted cash included in other current assets | 1,189 | 1,030 | |||||||||
| Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows | $ | 932,575 | $ | 1,230,808 | |||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
REVVITY, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1: Basis of Presentation
The condensed consolidated financial statements included herein have been prepared by Revvity, Inc. (the “Company”), in accordance with accounting principles generally accepted in the United States of America (the “U.S.” or the “United States”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information in the footnote disclosures of the financial statements has been condensed or omitted where it substantially duplicates information provided in the Company’s latest audited consolidated financial statements, in accordance with the rules and regulations of the SEC. These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes included in its Annual Report on Form 10-K for the fiscal year ended December 29, 2024, filed with the SEC (the “2024 Form 10-K”). The balance sheet amounts at December 29, 2024 in this report were derived from the Company’s audited 2024 consolidated financial statements included in the 2024 Form 10-K. The condensed consolidated financial statements reflect all adjustments that, in the opinion of management, are necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the periods indicated. Certain software revenue and related costs for the three and nine months ended September 29, 2024 have been reclassified from product revenue and cost of product revenue to service revenue and cost of service revenue, respectively, in the statement of operations to correct and conform to the current year presentation. The effects of the reclassifications are not significant. The preparation of financial statements in conformity with U.S. Generally Accepted Accounting Principles requires management to make estimates and assumptions that affect the reported amounts and classifications of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The results of operations for the three and nine months ended September 28, 2025 and September 29, 2024, respectively, are not necessarily indicative of the results for the entire fiscal year or any future period.
Accounting Standards Not Yet Adopted: In September 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2025-06, Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”). ASU 2025-06 amends certain aspects of the accounting for and disclosure of software costs. The amendments in this update are effective for annual reporting periods beginning after December 15, 2027, and interim periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. The guidance may be applied prospectively, retrospectively, or via a modified prospective transition method. The Company is in the process of determining the impact of this guidance on its financial statements and disclosures.
In November 2024, the FASB issued Accounting Standards Update 2024-03, Disaggregation of Income Statement Expenses (“ASU 2024-03”). ASU 2024-03 will require public entities to disclose disaggregated information about specific natural expense categories underlying certain income statement expense line items. Such disclosures are required on an annual and interim basis in a tabular presentation in the footnotes to the financial statements. In addition, ASU 2024-03 requires public entities to disclose selling expenses on an annual and interim basis. The guidance is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is in the process of determining the impact of this guidance on its financial statements and disclosures.
In December 2023, the FASB issued Accounting Standards Update 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 will require public entities to disclose on an annual basis a tabular reconciliation using both percentages and amounts, broken out into specific categories with certain reconciling items at or above 5% of the statutory (i.e. expected) tax further broken out by nature and/or jurisdiction. ASU 2023-09 requires all entities to disclose on an annual basis the amount of income taxes paid (net of refunds received), disaggregated between federal (national), state/local and foreign, and amounts paid to an individual jurisdiction when 5% or more of the total income taxes paid. The guidance is required to be applied on a prospective basis; retrospective application is permitted. The guidance is effective for annual periods beginning after December 15, 2024. The Company’s management does not believe the adoption of ASU 2023-09 will have a material impact on its financial statement disclosures.
Note 2: Revenue
Disaggregation of revenue
Disaggregated revenue by primary geographical markets and major goods and service lines are as follows:
| Reportable Segments | |||||||||||||||||||||||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||||||||
| September 28, 2025 | September 29, 2024 | ||||||||||||||||||||||||||||||||||
| Life Sciences | Diagnostics | Total | Life Sciences | Diagnostics | Total | ||||||||||||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||||||||||
| Primary geographical markets | |||||||||||||||||||||||||||||||||||
| Americas | $ | 178,087 | $ | 129,190 | $ | 307,277 | $ | 185,476 | $ | 116,849 | $ | 302,325 | |||||||||||||||||||||||
| Europe | 83,332 | 119,065 | 202,397 | 75,115 | 106,923 | 182,038 | |||||||||||||||||||||||||||||
| Asia | 81,403 | 107,872 | 189,275 | 78,209 | 121,477 | 199,686 | |||||||||||||||||||||||||||||
| $ | 342,822 | $ | 356,127 | $ | 698,949 | $ | 338,800 | $ | 345,249 | $ | 684,049 | ||||||||||||||||||||||||
| Major goods/service lines | |||||||||||||||||||||||||||||||||||
| Life Sciences Solutions | $ | 290,541 | $ | — | $ | 290,541 | $ | 295,455 | $ | — | $ | 295,455 | |||||||||||||||||||||||
| Software | 52,281 | — | 52,281 | 43,345 | — | 43,345 | |||||||||||||||||||||||||||||
| Immunodiagnostics | — | 212,739 | 212,739 | — | 211,566 | 211,566 | |||||||||||||||||||||||||||||
| Reproductive health | — | 143,388 | 143,388 | — | 133,683 | 133,683 | |||||||||||||||||||||||||||||
| $ | 342,822 | $ | 356,127 | $ | 698,949 | $ | 338,800 | $ | 345,249 | $ | 684,049 |
| Reportable Segments | |||||||||||||||||||||||||||||||||||
| Nine Months Ended | |||||||||||||||||||||||||||||||||||
| September 28, 2025 | September 29, 2024 | ||||||||||||||||||||||||||||||||||
| Life Sciences | Diagnostics | Total | Life Sciences | Diagnostics | Total | ||||||||||||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||||||||||
| Primary geographical markets | |||||||||||||||||||||||||||||||||||
| Americas | $ | 559,437 | $ | 376,049 | $ | 935,486 | $ | 551,843 | $ | 352,619 | $ | 904,462 | |||||||||||||||||||||||
| Europe | 243,652 | 344,169 | 587,821 | 227,123 | 318,065 | 545,188 | |||||||||||||||||||||||||||||
| Asia | 246,026 | 314,662 | 560,688 | 244,873 | 331,131 | 576,004 | |||||||||||||||||||||||||||||
| $ | 1,049,115 | $ | 1,034,880 | $ | 2,083,995 | $ | 1,023,839 | $ | 1,001,815 | $ | 2,025,654 | ||||||||||||||||||||||||
| Major goods/service lines | |||||||||||||||||||||||||||||||||||
| Life Sciences Solutions | $ | 875,046 | $ | — | $ | 875,046 | $ | 884,849 | $ | — | $ | 884,849 | |||||||||||||||||||||||
| Software | 174,069 | — | 174,069 | 138,990 | — | 138,990 | |||||||||||||||||||||||||||||
| Immunodiagnostics | — | 629,119 | 629,119 | — | 613,479 | 613,479 | |||||||||||||||||||||||||||||
| Reproductive health | — | 405,761 | 405,761 | — | 388,336 | 388,336 | |||||||||||||||||||||||||||||
| $ | 1,049,115 | $ | 1,034,880 | $ | 2,083,995 | $ | 1,023,839 | $ | 1,001,815 | $ | 2,025,654 |
Contract Balances
Unbilled receivable and Contract assets: The timing of revenue recognition may differ from the timing of customer billing. When revenue is recognized prior to billing and the right to the amount due from customers is conditioned only on the passage of time, the Company records an unbilled receivable on its consolidated balance sheets. The unbilled receivables are classified as either current in “Accounts receivable, net” or as long-term in “Other assets, net” in the condensed consolidated balance sheets. Unbilled receivables totaled $95.5 million and $80.6 million at September 28, 2025 and December 29, 2024, respectively, primarily related to the Life Sciences software business. The Company had no material contract assets as of September 28, 2025 and December 29, 2024.
Deferred revenue and Customer deposits: Deferred revenue is recorded when revenue is recognized subsequent to customer invoicing. Deferred revenue is classified as either current in “Accrued expenses and other current liabilities” or as long-term in “Other long-term liabilities” in the condensed consolidated balance sheets based on the timing of when the Company expects to recognize revenue. Substantially all of the deferred revenue is expected to be recognized in revenue within 12 months of the balance sheet date, and has been classified within accrued expenses and other current liabilities. The deferred revenue balance is primarily related to the Company’s software as a service offerings, maintenance contracts and prepaid storage arrangements. Deferred revenue totaled $224.0 million and $212.8 million at September 28, 2025 and December 29, 2024, respectively. The Company also had customer deposits received in advance of the transfer of control totaling $19.5 million at September 28, 2025 and December 29, 2024. The Company expects that these customer deposits will be recognized in revenue within three months of the balance sheet date.
Transaction price allocated to the remaining performance obligations
The Company applies the practical expedient and does not disclose information about remaining performance obligations that have original expected durations of one year or less. The estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the period are not material to the Company. The remaining performance obligations primarily include noncancelable purchase orders, noncancelable software subscriptions and cloud service contracts and long-term prepaid storage contracts.
Note 3: Discontinued Operations
During fiscal year 2023, the Company completed the sale of certain assets and the equity interests constituting the Company’s Applied, Food and Enterprise Services businesses (the “Business”) for approximately $2.27 billion in cash proceeds before transaction costs. During fiscal year 2023 and fiscal year 2024, the Company recognized a pre-tax gain (loss) on sale of $811.5 million and $(25.4) million, respectively. During fiscal year 2023 and fiscal year 2024, the Company recognized income (loss) from discontinued operations of $513.6 million and $(12.7) million, respectively. The Business was a component of the Company’s Discovery & Analytical Solutions segment, which is now referred to as the Life Sciences segment. The sale of the Business was reported as discontinued operations in the Company’s condensed consolidated financial statements.
During the three months ended September 28, 2025 and September 29, 2024, the Company recorded a (loss) gain on sale of $(0.3) million and $0.4 million, respectively, and a provision for (benefit from) income taxes of $0.2 million and $(0.6) million, respectively, related to the sale of the Business. During the nine months ended September 28, 2025 and September 29, 2024, the Company recorded a loss on sale of $(0.6) million and $(25.1) million, respectively, and a provision for (benefit from) income taxes of $0.7 million and $(6.1) million, respectively, related to the sale of the Business.
Note 4: Interest and Other Expense, Net
Interest and other expense, net, consisted of the following:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 28, 2025 | September 29, 2024 | September 28, 2025 | September 29, 2024 | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Interest income | $ | (6,925) | $ | (22,764) | $ | (25,351) | $ | (63,362) | |||||||||||||||
| Interest expense | 22,771 | 24,383 | 68,672 | 73,497 | |||||||||||||||||||
| Change in fair value of investments | 4,602 | (7,004) | 3,484 | (13,975) | |||||||||||||||||||
| Other components of net periodic pension cost | 1,729 | 1,956 | 10,211 | 5,778 | |||||||||||||||||||
| Foreign exchange losses and other expense, net | 4,034 | 1,223 | 11,153 | 4,485 | |||||||||||||||||||
| Total interest and other expense (income), net | $ | 26,211 | $ | (2,206) | $ | 68,169 | $ | 6,423 |
Note 5: Inventories, Net
Inventories, net consisted of the following:
| September 28, 2025 | December 29, 2024 | ||||||||||
| (In thousands) | |||||||||||
| Raw materials | $ | 174,651 | $ | 174,502 | |||||||
| Work in progress | 67,066 | 65,191 | |||||||||
| Finished goods | 138,200 | 127,894 | |||||||||
| Total inventories, net | $ | 379,917 | $ | 367,587 |
Note 6: Debt
The Company’s debt consisted of the following:
| September 28, 2025 | |||||||||||||||||||||||
| Outstanding Principal | Unamortized Debt Discount | Unamortized Debt Issuance Costs | Net Carrying Amount | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Long-Term Debt: | |||||||||||||||||||||||
| Senior Unsecured Revolving Credit Facility | $ | — | $ | — | $ | (3,035) | $ | (3,035) | |||||||||||||||
| 1.900% Senior Unsecured Notes due in 2028 | 500,000 | (160) | (1,929) | 497,911 | |||||||||||||||||||
| 3.3% Senior Unsecured Notes due in 2029 | 850,000 | (1,224) | (3,390) | 845,386 | |||||||||||||||||||
| 2.55% Senior Unsecured Notes due in March 2031 | 400,000 | (77) | (2,018) | 397,905 | |||||||||||||||||||
| 2.250% Senior Unsecured Notes due in September 2031 | 500,000 | (950) | (2,730) | 496,320 | |||||||||||||||||||
| 3.625% Senior Unsecured Notes due in 2051 | 400,000 | (3) | (3,966) | 396,031 | |||||||||||||||||||
| Other Debt Facilities, non-current | 175 | — | — | 175 | |||||||||||||||||||
| Total Long-Term Debt | $ | 2,650,175 | $ | (2,414) | $ | (17,068) | $ | 2,630,693 | |||||||||||||||
| Current Portion of Long-term Debt: | |||||||||||||||||||||||
| €500,000 Principal 1.875% Senior Unsecured Notes due in 2026 (“2026 Notes”) | 584,550 | (492) | (404) | 583,654 | |||||||||||||||||||
| Other Debt Facilities, current | 190 | — | — | 190 | |||||||||||||||||||
| Total Current Portion of Long-Term Debt | 584,740 | (492) | (404) | 583,844 | |||||||||||||||||||
| Total | $ | 3,234,915 | $ | (2,906) | $ | (17,472) | $ | 3,214,537 |
The Company entered into a senior unsecured revolving credit facility in 2021 (the “2021 Senior Unsecured Revolving Credit Facility”) with a five-year term and a borrowing capacity of $1.5 billion available through August 24, 2026. On January 7, 2025, the 2021 Senior Unsecured Revolving Credit Facility was replaced with a new senior unsecured revolving credit facility with a five-year term and a borrowing capacity of $1.5 billion available through January 7, 2030. Borrowings will bear interest, payable quarterly or, if earlier, at the end of any interest period, at the Company’s option at either (a) the base rate (as described in the credit agreement), or (b) the Term Secured Overnight Financing Rate (“Term SOFR”) (as described in the credit agreement), in each case plus a percentage spread based on the credit rating of the Company’s debt. The base rate is the highest of (a) the Federal Funds Rate (as defined in the credit agreement) plus 0.50%, (b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate”, and (c) Term SOFR plus 1.00%. The credit agreement for the new facility contains customary affirmative, negative and financial covenants and events of default. The financial covenants include a debt-to-capitalization ratio that remains applicable for so long as the Company’s debt is rated as investment grade. In the event that the Company’s debt is not rated as investment grade, the debt-to-capitalization ratio covenant is replaced with leverage ratio and interest coverage ratio covenants.
Note 7: Earnings Per Share
Basic earnings per share was computed by dividing net income by the weighted-average number of common shares outstanding during the period less restricted unvested shares. Diluted earnings per share was computed by dividing net income by the weighted-average number of common shares outstanding plus all potentially dilutive common stock equivalents,
primarily shares issuable upon the exercise of stock options using the treasury stock method. The following table reconciles the number of shares utilized in the earnings per share calculations:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 28, 2025 | September 29, 2024 | September 28, 2025 | September 29, 2024 | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Number of common shares—basic | 115,411 | 122,810 | 117,686 | 123,198 | |||||||||||||||||||
| Effect of dilutive securities: | |||||||||||||||||||||||
| Stock options | 5 | 56 | 17 | 54 | |||||||||||||||||||
| Restricted stock awards | 47 | 160 | 32 | 84 | |||||||||||||||||||
| Number of common shares—diluted | 115,463 | 123,026 | 117,735 | 123,336 | |||||||||||||||||||
| Number of potentially dilutive securities excluded from calculation due to antidilutive impact | 1,364 | 949 | 1,235 | 2,979 |
Antidilutive securities include outstanding stock options with exercise prices and average unrecognized compensation cost in excess of the average fair market value of common stock for the related period. Antidilutive options were excluded from the calculation of diluted net income per share and could become dilutive in the future.
Note 8: Segment Information
The Company discloses information about its operating segments based on the way that management organizes the segments within the Company for making operating decisions and assessing financial performance. The Company’s chief operating decision maker (“CODM”) is the Chief Executive Officer. The CODM evaluates the performance of the Company’s operating segments based on revenue and operating income adjusted for certain items. Intersegment revenue and transfers are not significant. The accounting policies of the operating segments are the same as those described in Note 1, Nature of Operations and Accounting Policies, to the audited consolidated financial statements in the 2024 Form 10-K.
Effective at the beginning of fiscal year 2025, the Company implemented changes to its operating model. The majority of the Company’s Applied Genomics business, previously reported as part of the Diagnostics segment, has been integrated into a newly formed Life Sciences Solutions business, encompassing all Life Sciences reagents and consumables, instruments and services, as well as technology and licensing, which is reported as part of the Life Sciences segment. Beginning in fiscal year 2025, the Life Sciences segment consists of Life Sciences Solutions and Software, while the Diagnostics segment consists of Immunodiagnostics and Reproductive Health.
The effect of the change is not significant. Prior period financial information has been reclassified to reflect this new segment composition for consistent comparison.
The Company has included the expenses for its corporate headquarters, such as legal, tax, audit, human resources, information technology, and other management and compliance costs, as well as the activity related to the mark-to-market adjustment on postretirement benefit plans, as “Corporate” below. The Company has a process to allocate and recharge expenses to the reportable segments when these costs are administered or paid by the corporate headquarters based on the extent to which the segment benefited from the expenses. These amounts have been calculated in a consistent manner and are included in the Company’s calculations of segment results to internally plan and assess the performance of each segment for all purposes, including determining the compensation of the business leaders for each of the Company’s operating segments.
The primary financial measure by which the CODM evaluates the performance of the Company’s segments is adjusted operating income. Adjusted operating income consists of operating income plus amortization of intangible assets, adjustments to operations arising from purchase accounting (primarily adjustments to the fair value of acquired inventory that are subsequently recognized), acquisition and divestiture-related costs, and other costs that are not expected to recur or are of a non-cash nature, primarily including transformation costs, significant litigation matters and restructuring actions. The CODM does not evaluate operating segments using discrete asset information and there are no segment assets reported to the CODM. Accordingly, no segment assets have been reported.
Revenue and operating income, including significant segment expenses, by reportable segment are shown in the table below:
| Three Months Ended | |||||||||||||||||||||||||||||||||||
| September 28, 2025 | September 29, 2024 | ||||||||||||||||||||||||||||||||||
| Life Sciences | Diagnostics | Total | Life Sciences | Diagnostics | Total | ||||||||||||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||||||||||
| Segment revenue | $ | 342,822 | $ | 356,127 | $ | 698,949 | $ | 338,800 | $ | 345,249 | $ | 684,049 | |||||||||||||||||||||||
| Segment cost of revenue | 129,976 | 158,900 | 117,546 | 144,653 | |||||||||||||||||||||||||||||||
| Segment selling, general and administrative expenses | 84,190 | 84,719 | 84,944 | 84,116 | |||||||||||||||||||||||||||||||
| Segment research and development expenses | 27,608 | 23,132 | 25,745 | 22,632 | |||||||||||||||||||||||||||||||
| Segment operating income | $ | 101,048 | $ | 89,376 | 190,424 | $ | 110,565 | $ | 93,848 | 204,413 | |||||||||||||||||||||||||
| Corporate expenses | (8,008) | (10,915) | |||||||||||||||||||||||||||||||||
| Amortization of intangible assets | (84,074) | (89,642) | |||||||||||||||||||||||||||||||||
| Purchase accounting adjustments | (348) | (103) | |||||||||||||||||||||||||||||||||
| Acquisition and divestiture-related costs | (284) | (4,874) | |||||||||||||||||||||||||||||||||
| Transformation costs | (5,103) | — | |||||||||||||||||||||||||||||||||
| Significant litigation matters and settlements | (785) | (810) | |||||||||||||||||||||||||||||||||
| Restructuring and other, net | (9,926) | 82 | |||||||||||||||||||||||||||||||||
| Interest and other (expense) income, net | (26,211) | 2,206 | |||||||||||||||||||||||||||||||||
| Income from continuing operations before income taxes | $ | 55,685 | $ | 100,357 |
| Nine Months Ended | |||||||||||||||||||||||||||||||||||
| September 28, 2025 | September 29, 2024 | ||||||||||||||||||||||||||||||||||
| Life Sciences | Diagnostics | Total | Life Sciences | Diagnostics | Total | ||||||||||||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||||||||||
| Segment revenue | $ | 1,049,115 | $ | 1,034,880 | $ | 2,083,995 | $ | 1,023,839 | $ | 1,001,815 | $ | 2,025,654 | |||||||||||||||||||||||
| Segment cost of revenue | 384,325 | 450,130 | 361,534 | 421,836 | |||||||||||||||||||||||||||||||
| Segment selling, general and administrative expenses | 258,271 | 258,736 | 255,048 | 249,996 | |||||||||||||||||||||||||||||||
| Segment research and development expenses | 84,291 | 73,201 | 78,174 | 67,182 | |||||||||||||||||||||||||||||||
| Segment operating income | $ | 322,228 | $ | 252,813 | 575,041 | $ | 329,083 | $ | 262,801 | 591,884 | |||||||||||||||||||||||||
| Corporate expenses | (30,912) | (33,725) | |||||||||||||||||||||||||||||||||
| Amortization of intangible assets | (252,063) | (271,500) | |||||||||||||||||||||||||||||||||
| Purchase accounting adjustments | (2,349) | (7,348) | |||||||||||||||||||||||||||||||||
| Acquisition and divestiture-related costs | (2,950) | (22,115) | |||||||||||||||||||||||||||||||||
| Transformation costs | (6,226) | — | |||||||||||||||||||||||||||||||||
| Significant litigation matters and settlements | (12,495) | (7,086) | |||||||||||||||||||||||||||||||||
| Significant environmental matters | 1,208 | — | |||||||||||||||||||||||||||||||||
| Restructuring and other, net | (24,368) | (22,119) | |||||||||||||||||||||||||||||||||
| Interest and other expense, net | (68,169) | (6,423) | |||||||||||||||||||||||||||||||||
| Income from continuing operations before income taxes | $ | 176,717 | $ | 221,568 |
Depreciation expense included in the Company’s reportable segment operating income and corporate expenses is as follows:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 28, 2025 | September 29, 2024 | September 28, 2025 | September 29, 2024 | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Life Sciences | $ | 8,456 | $ | 8,674 | $ | 24,188 | $ | 25,068 | |||||||||||||||
| Diagnostics | 8,785 | 8,839 | 23,910 | 24,540 | |||||||||||||||||||
| Corporate | 744 | 516 | 2,100 | 1,708 | |||||||||||||||||||
| Total depreciation expense | $ | 17,985 | $ | 18,029 | $ | 50,198 | $ | 51,316 | |||||||||||||||
Note 9: Stockholders’ Equity
Comprehensive Income:
The components of accumulated other comprehensive loss consisted of the following:
| September 28, 2025 | December 29, 2024 | ||||||||||
| (In thousands) | |||||||||||
| Foreign currency translation adjustments, net of income taxes | $ | (178,659) | $ | (394,938) | |||||||
| Unrecognized prior service costs, net of income taxes | (798) | (798) | |||||||||
| Unrealized net losses on marketable securities, net of income taxes | (348) | (369) | |||||||||
| Accumulated other comprehensive loss | $ | (179,805) | $ | (396,105) |
The unrealized foreign exchange losses (gains) on intercompany debt for which repayment is not anticipated in the foreseeable future that was recorded in accumulated other comprehensive income (“AOCI”) were $22.6 million and $2.8 million for the three months ended September 28, 2025 and September 29, 2024, respectively, and $(206.1) million and $1.5 million for the nine months ended September 28, 2025 and September 29, 2024, respectively.
Stock Repurchases:
On October 24, 2024, the Company’s Board of Directors (the “Board”) authorized the Company to repurchase shares of common stock for an aggregate amount up to $1.0 billion under a stock repurchase program (the “Repurchase Program”). The Repurchase Program was set to expire on October 23, 2026 unless terminated earlier by the Board and could have been suspended or discontinued at any time. During the three months ended September 28, 2025, the Company repurchased 2,322,206 shares of common stock under the Repurchase Program for an aggregate cost of $204.9 million. During the nine months ended September 28, 2025, the Company repurchased 6,749,067 shares of common stock under the Repurchase Program for an aggregate cost of $647.9 million. As of September 28, 2025, $209.7 million remained available for aggregate repurchases of shares under the Repurchase Program. Subsequent to the third quarter of fiscal year 2025, the Company repurchased 515,232 shares of common stock under the Repurchase Program at an aggregate cost of $47.5 million.
On October 23, 2025, the Repurchase Program was terminated by the Board and the Board authorized the Company to repurchase shares of common stock for an aggregate amount up to $1.0 billion under a new stock repurchase program (the “New Repurchase Program”). No shares remain available for repurchase under the Repurchase Program due to its termination. The New Repurchase Program will expire on October 22, 2027 unless terminated earlier by the Board and may be suspended or discontinued at any time. Subsequent to October 23, 2025, the Company repurchased 172,642 shares of common stock under the New Repurchase Program at an aggregate cost of $16.5 million.
In addition, the Board has authorized the Company to repurchase shares of common stock to satisfy minimum statutory tax withholding obligations in connection with the vesting of restricted stock awards and restricted stock unit awards granted pursuant to the Company’s equity incentive plans and to satisfy obligations related to the exercise of stock options made pursuant to the Company’s equity incentive plans. During the three months ended September 28, 2025, the Company repurchased 2,145 shares of common stock for this purpose at an aggregate cost of $0.2 million. During the nine months ended September 28, 2025, the Company repurchased 34,879 shares of common stock for this purpose at an aggregate cost of $3.9 million. The repurchased shares have been reflected as additional authorized but unissued shares, with the payments reflected in common stock and capital in excess of par value.
Dividends:
The Board declared a regular quarterly cash dividend of $0.07 per share for each of the first three quarters of fiscal year 2025 and in each quarter of fiscal year 2024. At September 28, 2025, the Company had accrued $8.0 million for dividends declared on July 24, 2025 for the third quarter of fiscal year 2025 that will be paid in November 2025. On October 23, 2025, the Company announced that the Board had declared a quarterly dividend of $0.07 per share for the fourth quarter of fiscal year 2025 that will be payable in February 2026. In the future, the Board may determine to reduce or eliminate the Company’s common stock dividend in order to fund investments for growth, repurchase shares or conserve capital resources.
Note 10: Goodwill and Intangible Assets, Net
The Company tests goodwill at least annually for possible impairment. The Company completes the annual testing of impairment for goodwill on the later of November 1 or the first day of its eleventh fiscal month of each fiscal year. In addition to its annual test, the Company regularly evaluates whether events or circumstances have occurred that may indicate a potential impairment of goodwill.
The process of testing goodwill for impairment involves the determination of the fair value of the applicable reporting units. The test consists of the comparison of the fair value to the carrying value of the reporting unit to determine if the carrying value exceeds the fair value. If the carrying value of the reporting unit exceeds its fair value, an impairment loss in an amount equal to that excess is recognized up to the amount of goodwill. The Company performed its annual impairment testing for its reporting units for fiscal year 2024 as of November 1, 2024. There were no impairments measured in the periods presented. While the Company believes that its estimates of current value are reasonable, if actual results differ from the estimates and judgments used, including such items as future cash flows and the volatility inherent in markets which the Company serves, impairment charges against the carrying value of those assets could be required in the future.
The changes in the carrying amount of goodwill for the nine months ended September 28, 2025 were as follows:
| Life Sciences | Diagnostics | Consolidated | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Balance at December 29, 2024 | $ | 4,541,467 | $ | 1,922,152 | $ | 6,463,619 | |||||||||||
| Foreign currency translation | 96,267 | 40,745 | 137,012 | ||||||||||||||
| Acquisitions, earn-outs and other | 98 | (98) | — | ||||||||||||||
| Balance at September 28, 2025 | $ | 4,637,832 | $ | 1,962,799 | $ | 6,600,631 |
Identifiable intangible asset balances by category were as follows:
| September 28, 2025 | December 29, 2024 | ||||||||||
| (In thousands) | |||||||||||
| Patents | $ | 27,805 | $ | 27,808 | |||||||
| Less: Accumulated amortization | (26,467) | (26,293) | |||||||||
| Net patents | 1,338 | 1,515 | |||||||||
| Trade names and trademarks | 149,468 | 142,588 | |||||||||
| Less: Accumulated amortization | (99,392) | (87,824) | |||||||||
| Net trade names and trademarks | 50,076 | 54,764 | |||||||||
| Licenses | 27,487 | 27,164 | |||||||||
| Less: Accumulated amortization | (19,395) | (17,855) | |||||||||
| Net licenses | 8,092 | 9,309 | |||||||||
| Core technology | 1,618,415 | 1,561,831 | |||||||||
| Less: Accumulated amortization | (881,299) | (735,532) | |||||||||
| Net core technology | 737,116 | 826,299 | |||||||||
| Customer relationships | 2,859,641 | 2,807,909 | |||||||||
| Less: Accumulated amortization | (1,230,337) | (1,058,875) | |||||||||
| Net customer relationships | 1,629,304 | 1,749,034 | |||||||||
| Total | $ | 2,425,926 | $ | 2,640,921 | |||||||
Total amortization expense related to amortizable intangible assets was $84.1 million and $252.1 million for the three and nine months ended September 28, 2025, respectively, and $89.6 million and $271.5 million for the three and nine months ended September 29, 2024, respectively. Estimated amortization expense related to amortizable intangible assets is $84.6 million for the remainder of fiscal year 2025, $332.1 million for fiscal year 2026, $304.6 million for fiscal year 2027, $278.6 million for fiscal year 2028, and $249.2 million for fiscal year 2029.
Note 11: Derivatives and Hedging Activities
The Company uses derivative instruments as part of its risk management strategy only, and includes derivatives utilized as economic hedges that are not designated as hedging instruments. By nature, all financial instruments involve market and credit risks. The Company enters into derivative instruments with major investment grade financial institutions and has policies to monitor the credit risk of those counterparties. The Company does not enter into derivative contracts for trading or other speculative purposes, nor does the Company use leveraged financial instruments. Approximately 60% of the Company’s business is conducted outside of the United States, generally in foreign currencies. As a result, fluctuations in foreign currency exchange rates can increase the costs of financing, investing and operating the business.
In the ordinary course of business, the Company enters into foreign exchange contracts for periods consistent with its committed exposures to mitigate the effect of foreign currency movements on transactions denominated in foreign currencies. The intent of these economic hedges is to offset gains and losses that occur on the underlying exposures from these currencies, with gains and losses resulting from the forward currency contracts that hedge these exposures. Transactions covered by hedge contracts include intercompany and third-party receivables and payables. The contracts are primarily in European and Asian currencies, have maturities that do not exceed 12 months, have no cash requirements until maturity, and are recorded at fair value on the Company’s condensed consolidated balance sheets. The unrealized gains and losses on the Company’s foreign currency contracts are recognized immediately in interest and other expense, net. The cash flows related to the settlement of these hedges are included in cash flows from operating activities within the Company’s condensed consolidated statement of cash flows.
Principal hedged currencies include the Chinese Renminbi, British Pound, Euro and Singapore Dollar. The Company held forward foreign exchange contracts, designated as economic hedges, with U.S. dollar equivalent notional amounts totaling $530.4 million, $409.8 million and $445.4 million at September 28, 2025, December 29, 2024 and September 29, 2024, respectively, and the fair value of these foreign currency derivative contracts was insignificant. The gains and losses realized on
these foreign currency derivative contracts are not material. The duration of these contracts was generally 30 days or less during each of the nine months ended September 28, 2025 and September 29, 2024.
During fiscal year 2018, the Company designated a portion of the 2026 Notes to hedge its net investments in certain foreign subsidiaries. Unrealized translation adjustments from a portion of the 2026 Notes were included in the foreign currency translation component of AOCI, which offsets translation adjustments on the underlying net assets of foreign subsidiaries. The cumulative translation gains or losses will remain in AOCI until the foreign subsidiaries are liquidated or sold. As of September 28, 2025, the total notional amount of the 2026 Notes that was designated to hedge net investments in foreign subsidiaries was €498.6 million. The unrealized foreign exchange (gains) losses recorded in AOCI related to the net investment hedge were $(1.2) million and $62.7 million for the three and nine months ended September 28, 2025, and $22.1 million and $4.4 million for the three and nine months ended September 29, 2024, respectively.
The Company does not expect any material net pre-tax gains or losses to be reclassified from accumulated other comprehensive loss into interest and other expense, net within the next twelve months.
Note 12: Fair Value Measurements
Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash equivalents, derivatives, accounts receivable and notes receivable. The Company believes it had no significant concentrations of credit risk as of September 28, 2025.
The Company uses the market approach technique to value its financial instruments and there were no changes in valuation techniques during the nine months ended September 28, 2025. The Company’s financial assets and liabilities carried at fair value are primarily comprised of marketable securities, derivative contracts used to hedge the Company’s currency risk, and acquisition and divestiture related contingent consideration. The Company has not elected to measure any additional financial instruments or other items at fair value.
Valuation Hierarchy: The following summarizes the three levels of inputs required to measure fair value. For Level 1 inputs, the Company utilizes quoted market prices as these instruments have active markets. For Level 2 inputs, the Company utilizes quoted market prices in markets that are not active, broker or dealer quotations, or utilizes alternative pricing sources with reasonable levels of price transparency. For Level 3 inputs, the Company utilizes unobservable inputs based on the best information available, including estimates by management primarily based on information provided by third-party fund managers, independent brokerage firms and insurance companies. A financial asset’s or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible.
The following tables show the assets and liabilities carried at fair value measured on a recurring basis as of September 28, 2025 and December 29, 2024 classified in one of the three classifications described above:
| Fair Value Measurements at September 28, 2025 Using: | |||||||||||||||||||||||
| Total Carrying Value at September 28, 2025 | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Marketable securities - available for sale | $ | 29,412 | $ | 29,412 | $ | — | $ | — | |||||||||||||||
| Foreign exchange derivative assets | 445 | — | 445 | — | |||||||||||||||||||
| Foreign exchange derivative liabilities | (1,261) | — | (1,261) | — | |||||||||||||||||||
| Contingent consideration asset | 14,890 | — | — | 14,890 | |||||||||||||||||||
| Contingent consideration liabilities | (19,156) | — | — | (19,156) |
| Fair Value Measurements at December 29, 2024 Using: | |||||||||||||||||||||||
| Total Carrying Value at December 29, 2024 | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Marketable securities - available for sale | $ | 27,413 | $ | 27,413 | $ | — | $ | — | |||||||||||||||
| Foreign exchange derivative assets | 861 | — | 861 | — | |||||||||||||||||||
| Foreign exchange derivative liabilities | (1,048) | — | (1,048) | — | |||||||||||||||||||
| Contingent consideration asset | 14,890 | — | — | 14,890 | |||||||||||||||||||
| Contingent consideration liabilities | (21,753) | — | — | (21,753) |
Level 1 and Level 2 Valuation Techniques: The Company’s Level 1 and Level 2 assets and liabilities are comprised of investments in equity and fixed-income securities as well as derivative contracts. For financial assets and liabilities that utilize Level 1 and Level 2 inputs, the Company utilizes both direct and indirect observable price quotes, including common stock price quotes, foreign exchange forward prices and bank price quotes. Below is a summary of valuation techniques for Level 1 and Level 2 financial assets and liabilities.
Marketable securities - available for sale: Includes equity and mutual fund investments measured at fair value using the quoted market prices in active markets at the reporting date.
Foreign exchange derivative assets and liabilities: Include foreign exchange derivative contracts that are valued using quoted forward foreign exchange prices at the reporting date. The Company’s foreign exchange derivative contracts are subject to master netting arrangements that allow the Company and its counterparties to net settle amounts owed to each other. Derivative assets and liabilities that can be net settled under these arrangements have been presented in the Company’s condensed consolidated balance sheet on a net basis and are recorded in other assets. As of both September 28, 2025 and December 29, 2024, none of the master netting arrangements involved collateral.
Level 3 Valuation Techniques: The Company’s Level 3 assets and liabilities are comprised of contingent consideration related to the sale of the Business (see Note 3) and acquisitions. For assets and liabilities that utilize Level 3 inputs, the Company uses significant unobservable inputs. Below is a summary of valuation techniques for Level 3 assets and liabilities.
Contingent consideration: Contingent consideration is measured at fair value at the disposition or acquisition date using projected milestone dates, discount rates, volatility, probabilities of success and projected achievement of financial targets, including revenues of the acquired business in many instances. Projected risk-adjusted contingent payments are discounted back to the current period using a discounted cash flow model.
The fair value of the contingent consideration asset was initially measured using a lattice model and recognized upon the sale of the Business on March 13, 2023. In accordance with the terms of the sale of the Business, the Company is entitled to receive up to $150.0 million that is contingent on the exit valuation the buyer and its affiliated funds receive on a sale or other capital event related to the Business. Potential valuation adjustments may be made as additional information and market factors that impact the expected exit valuation of the Business becomes available, with the impact of such adjustments being recorded in the Company’s condensed consolidated statements of operations. Adjustments to the fair value since initial recognition were not material.
The fair values of contingent consideration liabilities are calculated on a quarterly basis based on a collaborative effort of the Company’s operations, finance and accounting groups, as appropriate. Valuation adjustments are made as additional information becomes available, including the progress towards achieving the revenue targets, with the impact of such adjustments being recorded in the Company’s condensed consolidated statements of operations.
A reconciliation of the beginning and ending Level 3 contingent consideration liabilities is as follows:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 28, 2025 | September 29, 2024 | September 28, 2025 | September 29, 2024 | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Balance at beginning of period | $ | (21,090) | $ | (30,540) | $ | (21,753) | $ | (40,005) | |||||||||||||||
| Amounts paid and foreign currency translation | 2,041 | (889) | 2,538 | 14,925 | |||||||||||||||||||
| Change in fair value (included within selling, general and administrative expenses) | (107) | 344 | 59 | (6,005) | |||||||||||||||||||
| Balance at end of period | $ | (19,156) | $ | (31,085) | $ | (19,156) | $ | (31,085) |
Financial Instruments Not Recorded at Fair Value
The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value due to the short-term maturities of these assets and liabilities. If measured at fair value, cash and cash equivalents would be classified as Level 1.
The Company’s outstanding senior unsecured notes had an aggregate fair value of $2,940.3 million and an aggregate carrying value of $3,217.2 million as of September 28, 2025. The Company’s outstanding senior unsecured notes had an aggregate fair value of $2,765.5 million and an aggregate carrying value of $3,151.5 million as of December 29, 2024. The fair values of the outstanding senior unsecured notes were estimated using market quotes from brokers and were based on current rates offered for similar debt, which are Level 2 measurements.
The Company’s other debt facilities, including the Company’s senior unsecured revolving credit facility, had an aggregate carrying value of $0.4 million and $0.5 million as of September 28, 2025 and December 29, 2024, respectively. The carrying values approximate fair value and were classified as Level 2.
Note 13: Contingencies
The Company is conducting a number of environmental investigations and remedial actions at current and former locations of the Company and, along with other companies, has been named a potentially responsible party (“PRP”) for certain waste disposal sites. The Company accrues for environmental issues in the accounting period that the Company’s responsibility is established and when the cost can be reasonably estimated. The Company has accrued $11.1 million and $14.2 million as of September 28, 2025 and December 29, 2024, respectively, which represents its management’s estimate of the cost of the remediation of known environmental matters and does not include any potential liability for related personal injury or property damage claims. These amounts were included in accrued expenses and other current liabilities. The Company’s environmental accrual is not discounted and does not reflect the recovery of any material amounts through insurance or indemnification arrangements. The cost estimates are subject to a number of variables, including the stage of the environmental investigations, the magnitude of the possible contamination, the nature of the potential remedies, possible joint and several liability, the time period over which remediation may occur, and the possible effects of changing laws and regulations. For sites where the Company has been named a PRP, management does not currently anticipate any additional liability to result from the inability of other significant named parties to contribute. The Company expects that the majority of such accrued amounts could be paid out over a period of up to ten years. As assessment and remediation activities progress at each individual site, these liabilities are reviewed and adjusted to reflect additional information as it becomes available. There have been no environmental problems
to date that have had, or are expected to have, a material adverse effect on the Company’s condensed consolidated financial statements. While it is possible that a loss exceeding the amounts recorded in the condensed consolidated financial statements may be incurred, the potential exposure is not expected to be materially different from those amounts recorded.
The Company is subject to various claims, legal proceedings and investigations covering a wide range of matters that arise in the ordinary course of its business activities, including product liability claims. Legal defense costs are recognized as incurred, and insurance recoveries are recognized when collection is probable. Although the Company has established accruals for potential losses that it believes are probable and reasonably estimable, in the opinion of the Company’s management, based on its review of the information available at the reporting date, the total cost of resolving these contingencies at September 28, 2025 should not have a material adverse effect on the Company’s condensed consolidated financial statements. However, each of these matters is subject to uncertainties, and it is possible that some of these matters may be resolved unfavorably to the Company.
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