Teledyne Technologies 10-Q 2025-03-30

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 10-Q

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☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 30, 2025

OR

☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 1-15295

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TELEDYNE TECHNOLOGIES INCORPORATED

(Exact name of registrant as specified in its charter)

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Delaware									25-1843385
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification No.)
1049 Camino Dos Rios
Thousand Oaks
California									91360-2362
(Address of principal executive offices)									(Zip Code)

805 373-4545

(Registrant’s telephone number, including area code)

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Securities registered pursuant to Section 12(b) of the Act:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common Stock, $0.01 par value			TDY			New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer			☒			Accelerated filer			☐
Non-accelerated filer			☐			Smaller reporting company			☐
						Emerging growth company			☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):

Yes ☐ No ☒

There were 46,859,346 shares of common stock, $.01 par value per share, outstanding as of April 16, 2025.

Table of Contents

TELEDYNE TECHNOLOGIES INCORPORATED

TABLE OF CONTENTS

						PAGE
Part I			Financial Information			2
			Item 1. Financial Statements			2
			Condensed Consolidated Statements of Income (Loss)			2
			Condensed Consolidated Statements of Comprehensive Income (Loss)			3
			Condensed Consolidated Balance Sheets			4
			Condensed Consolidated Statements of Stockholders’ Equity			5
			Condensed Consolidated Statements of Cash Flows			6
			Notes to Condensed Consolidated Financial Statements			7
			Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			21
			Item 3. Quantitative and Qualitative Disclosures About Market Risk			29
			Item 4. Controls and Procedures			30
Part II			Other Information			31
			Item 1. Legal Proceedings			31
			Item 1A. Risk Factors			31
			Item 5. Other Information			31
			Item 6. Exhibits			32
Signatures						33

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PART I FINANCIAL INFORMATION

TELEDYNE TECHNOLOGIES INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

FOR THE FIRST QUARTER ENDED MARCH 30, 2025 AND MARCH 31, 2024

(Unaudited — Amounts in millions, except per share amounts)

			First Quarter
			2025						2024
Net sales			$	1,449.9					$	1,350.1
Costs and expenses
Cost of sales			830.4						770.2
Selling, general and administrative			233.9						219.7
Research and development			74.3						76.5
Acquired intangible asset amortization			52.0						49.4
Total costs and expenses			1,190.6						1,115.8
Operating income (loss)			259.3						234.3
Interest and debt income (expense), net			(17.3)						(12.7)
Non-service retirement benefit income (expense), net			2.8						2.7
Other income (expense), net			(5.9)						1.2
Income (loss) before income taxes			238.9						225.5
Provision (benefit) for income taxes			50.1						46.4
Net income (loss) including noncontrolling interest			188.8						179.1
Less: Net income (loss) attributable to noncontrolling interest			0.2						0.6
Net income (loss) attributable to Teledyne			$	188.6					$	178.5
Basic earnings per common share			$	4.03					$	3.77
Weighted average common shares outstanding			46.8						47.3
Diluted earnings per common share			$	3.99					$	3.72
Weighted average diluted common shares outstanding			47.3						48.0

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

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TELEDYNE TECHNOLOGIES INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

FOR THE FIRST QUARTER ENDED MARCH 30, 2025 AND MARCH 31, 2024

(Unaudited — Amounts in millions)

			First Quarter
			2025						2024
Net income (loss) including noncontrolling interest			$	188.8					$	179.1
Other comprehensive income (loss):
Foreign exchange translation adjustment			150.8						(88.8)
Hedge activity, net of tax			1.3						(4.2)
Pension and postretirement benefit adjustments, net of tax			1.5						2.1
Other comprehensive income (loss)			153.6						(90.9)
Comprehensive income (loss) including noncontrolling interest			342.4						88.2
Less: Comprehensive income (loss) attributable to noncontrolling interest			0.2						0.6
Comprehensive income (loss) attributable to Teledyne			$	342.2					$	87.6

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

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TELEDYNE TECHNOLOGIES INCORPORATED

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited — Amounts in millions, except share amounts)

			March 30, 2025						December 29, 2024
Assets
Current Assets
Cash and cash equivalents			$	461.5					$	649.8
Accounts receivable, net			935.5						901.1
Unbilled receivables, net			368.3						312.1
Inventories, net			1,011.8						914.4
Prepaid expenses and other current assets			204.6						167.2
Total current assets			2,981.7						2,944.6
Property, plant and equipment, net of accumulated depreciation and amortization of $1,045.9 at March 30, 2025 and $1,012.1 at December 29, 2024			815.3						745.2
Goodwill			8,534.0						7,990.5
Acquired intangibles, net			2,187.8						2,012.9
Prepaid pension assets			231.8						227.6
Other assets, net			297.9						279.7
Total Assets			$	15,048.5					$	14,200.5
Liabilities, Redeemable Noncontrolling Interest and Stockholders’ Equity
Current Liabilities
Accounts payable			$	489.9					$	416.4
Accrued liabilities			874.3						844.9
Current portion of long-term debt			0.2						0.3
Total current liabilities			1,364.4						1,261.6
Long-term debt, net of current portion			2,964.6						2,648.7
Long-term deferred tax liabilities			374.1						354.0
Other long-term liabilities			414.0						380.8
Total Liabilities			5,117.1

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Overview

Teledyne provides enabling technologies for industrial growth markets that require advanced technology and high reliability. These markets include aerospace and defense, factory automation, air and water quality environmental monitoring, electronics design and development, oceanographic research, deepwater oil and gas exploration and production, medical imaging and pharmaceutical research. Our products include digital imaging sensors, cameras and systems within the visible, infrared and X-ray spectra, monitoring and control instrumentation for marine and environmental applications, harsh environment interconnects, electronic test and measurement equipment, aircraft information management systems, and defense electronics and satellite communication subsystems. We also supply engineered systems for defense, space, environmental and energy applications. We believe our technological capabilities, innovation and the ability to invest in the development of new and enhanced products are critical to obtaining and maintaining leadership in our markets and the industries in which we compete.

Strategy

Our strategy continues to emphasize growth in our four business segments: Digital Imaging, Instrumentation, Aerospace and Defense Electronics and Engineered Systems. The markets in which we sell our enabling technologies are characterized by high barriers to entry and include specialized products and services not likely to be commoditized. We intend to strengthen and expand our business with targeted acquisitions and through product development. We continue to focus on balanced and disciplined capital deployment among capital expenditures, acquisitions, stock repurchases and product development. We aggressively pursue operational excellence to continually improve our margins and earnings by emphasizing cost containment and evaluating cost reductions in all aspects of our business. At Teledyne, operational excellence includes the rapid integration of the businesses we acquire. Using complementary technology across our businesses and through targeted research and development (“R&D”), we seek to create new products to grow our company and expand our addressable markets. We continually evaluate our businesses to ensure that they are aligned with our strategy.

Consistent with our strategy, we completed two acquisitions each in the first quarter of 2025 and the full year of 2024. The financial results of the completed acquisitions have been included since the respective date of each acquisition.

Trends and Other Matters Affecting Our Business

In early 2025, the U.S. Presidential administration implemented significant new tariffs on foreign imports impacting multiple countries, commodities and industries, and these new tariffs and export restrictions also prompted retaliatory tariffs and export restrictions from certain countries. As of April 2025, certain tariffs and retaliatory tariffs have been delayed, but a number of the new tariffs remain in effect, including significant tariffs and trade sanctions between the United States and China. Our net sales to China-based customers represented approximately 4% of total revenues in 2024, of which less than 50% of these sales were made directly from our U.S. subsidiaries. China has also restricted the export of certain rare earth minerals which are used in our products. Tariffs, trade restrictions and retaliatory measures could result in revenue reduction, cost increases on material used in our products or significant production delays, which could adversely affect our business, financial condition, operational results and cash flows. Consistent with our strategy, we are optimizing operations and facilities and taking measures to contain costs to reduce the impact from tariffs. We may also implement additional pricing actions to mitigate the impact of these tariffs.

Sales recorded and costs incurred recorded by subsidiaries operating outside of the United States are translated into U.S. dollars using exchange rates effective during the respective period. As a result, we are exposed to movements in the exchange rates of various currencies against the U.S. dollar. See Note 13 for additional discussion around our derivative instruments and hedging activities used to mitigate these impacts.

As part of a continuing effort to reduce costs and improve operating performance, we continue to take actions to consolidate and relocate certain facilities and reduce head count across various businesses, reducing our exposure to weaker end markets. We continue to seek cost reductions in our businesses.

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Results of Operations

			First Quarter												%
(dollars in millions)			2025						2024						Change
Net sales			$	1,449.9					$	1,350.1					7.4		%
Costs and expenses
Cost of sales			830.4						770.2						7.8		%
Selling, general and administrative			233.9						219.7						6.5		%
Research and development			74.3						76.5						(2.9)		%
Acquired intangible asset amortization			52.0						49.4						5.3		%
Total costs and expenses			1,190.6						1,115.8						6.7		%
Operating income (loss)			259.3						234.3						10.7		%
Interest and debt income (expense), net			(17.3)						(12.7)						36.2		%
Non-service retirement benefit income (expense)			2.8						2.7						3.7		%
Other income (expense), net			(5.9)						1.2						*
Income before income taxes			238.9						225.5						5.9		%
Provision (benefit) for income taxes			50.1						46.4						8.0		%
Net income (loss) including noncontrolling interest			188.8						179.1						5.4		%
Less: Net income (loss) attributable to noncontrolling interest			0.2						0.6						(66.7)		%
Net income (loss) attributable to Teledyne			$	188.6					$	178.5					5.7		%

• Not meaningful

			First Quarter												%
(dollars in millions)			2025						2024						Change
Net sales (a):
Digital Imaging			$	757.0					$	740.8					2.2		%
Instrumentation			343.3						330.4						3.9		%
Aerospace and Defense Electronics			242.5						185.7						30.6		%
Engineered Systems			107.1						93.2						14.9		%
Total net sales			$	1,449.9					$	1,350.1					7.4		%
Operating income (loss):
Digital Imaging			$	122.3					$	113.8					7.5		%
Instrumentation			92.7						86.0						7.8		%
Aerospace and Defense Electronics			55.7						51.9						7.3		%
Engineered Systems			10.8						2.7						300.0		%
Corporate expense			(22.2)						(20.1)						10.4		%
Total operating income (loss)			$	259.3					$	234.3					10.7		%

(a) Net sales exclude inter-segment sales of $3.8 million and $4.8 million for the first quarter of 2025 and 2024, respectively.

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First Quarter Results

The following is a discussion of our 2025 first quarter results compared with the first quarter results of 2024. Comparisons are with the corresponding reporting period of 2024 unless noted otherwise.

First quarter of 2025 compared with the first quarter of 2024

Our first quarter of 2025 net sales increased 7.4%. Net income attributable to Teledyne for the first quarter of 2025 increased 5.7%, driven primarily by higher net sales. Net income per diluted share was $3.99 for the first quarter of 2025, compared with net income per diluted share of $3.72.

Net Sales

The first quarter of 2025 net sales compared with the first quarter of 2024 reflected higher net sales in each segment. The first quarter of 2025 included $55.6 million in incremental sales from recent acquisitions.

Cost of Sales

Cost of sales increased $60.2 million in the first quarter of 2025, primarily driven by higher net sales. Cost of sales as a percentage of net sales increased slightly for the first quarter of 2025 to 57.3% from 57.0%.

Selling, General and Administrative Expense

Selling, general and administrative (“SG&A”) expense increased $14.2 million in the first quarter of 2025 due to higher net sales. SG&A expense as a percentage of net sales decreased to 16.1% for the first quarter of 2025 compared with 16.3%. Corporate expense, which is included in SG&A expense, was $22.2 million for the first quarter of 2025 compared with $20.1 million, with the increase primarily related to higher transaction costs in the first quarter of 2025 related to current year acquisitions. Stock-based compensation expense was $8.9 million for the first quarter of 2025 compared with $12.0 million, with the decrease due to timing of grants in the current year. Subsequent to the end of the first quarter of 2025, the Company made its annual stock option and restricted stock grants.

Research and Development Expense

R&D expense decreased $2.2 million in the first quarter of 2025 due to lower R&D expense at the Digital Imaging segment.

Acquired Intangible Asset Amortization

Acquired intangible asset amortization for the first quarter of 2025 was $52.0 million compared with $49.4 million, with the increase primarily related to 2025 acquisitions within the Aerospace and Defense Electronics segment.

Pension Service Expense

Pension service expense is included in both cost of sales and SG&A expense. For the first quarter of 2025 and 2024, pension service expense was $1.5 million. For 2025, the weighted-average discount rate used to determine the benefit obligation for the domestic qualified pension plans is 7.05% compared with 6.86% in 2024.

Operating Income

Operating income for the first quarter of 2025 increased 10.7%. The first quarter of 2025, compared with the first quarter of 2024, reflected higher operating income in each segment.

Non-operating Income and Expense

Interest and debt expense, net of interest income, was $17.3 million for the first quarter of 2025 compared with $12.7 million, with the decrease related to higher outstanding borrowings compared to the first quarter of 2024. Non-service retirement benefit income was $2.8 million for the first quarter of 2025 compared with $2.7 million. Other income and expense, net, was expense of $5.9 million for the first quarter of 2025 compared with income of $1.2 million for the first quarter of 2024. Other income and expense, net, primarily consisted of foreign currency exchange losses in the first quarter of 2025, as compared with foreign currency exchange gains in the first quarter of 2024.

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Income Tax

The first quarter income tax provision considers income, permanent items, tax credits, and various statutory tax rates.

			First Quarter
(dollars in millions)			2025						2024
Provision (benefit) for income taxes (a)			$	50.1					$	46.4
Income (loss) before income taxes			$	238.9					$	225.5
Effective tax rate			21.0%						20.6%

(a) The first quarter of 2025 includes net discrete income tax benefits of $3.7 million and the first quarter of 2024 includes net discrete income tax benefits of $4.4 million.

Segment Results

Segment results include net sales and operating income by segment but exclude corporate office expenses. Corporate expense primarily includes various administrative expenses relating to our corporate office that are not allocated to our segments. See Note 3 to these condensed consolidated financial statements for additional segment information.

Digital Imaging

			First Quarter												Change
(dollars in millions)			2025						2024						$						%
Net sales			$	757.0					$	740.8					$	16.2					2.2		%
Cost of sales			$	422.5					$	408.6					$	13.9					3.4		%
Selling, general and administrative expense			$	122.7					$	123.7					$	(1.0)					(0.8)		%
Research and development expense			$	44.1					$	48.9					$	(4.8)					(9.8)		%
Acquired intangible asset amortization			$	45.4					$	45.8					$	(0.4)					(0.9)		%
Operating income			$	122.3					$	113.8					$	8.5					7.5		%
As a percentage of net sales:
Cost of sales			55.8		%				55.2		%
Selling, general and administrative expense			16.2		%				16.6		%
Research and development expense			5.8		%				6.6		%
Acquired intangible asset amortization			6.0		%				6.2		%
Operating income			16.2		%				15.4		%

First quarter of 2025 compared with the first quarter of 2024

Net sales increased primarily due to higher sales of commercial infrared imaging components as well as surveillance systems, partially offset by lower sales of X-ray products. Sales of commercial infrared imaging components increased $13.9 million, sales of surveillance systems increased $11.7 million, and sales of X-Ray products decreased $6.9 million. The first quarter of 2025 included $8.9 million in incremental sales from recent acquisitions.

Cost of sales increased primarily due to product mix. As a result of unfavorable product mix, the cost of sales percentage increased during the period. SG&A expense decreased primarily due to cost reduction initiatives that completed in 2024, partially offset by higher sales. As a result, SG&A expense as a percentage of net sales decreased during the quarter. R&D expense decreased primarily due to ongoing cost rationalization and cost reduction initiatives.

Operating income increased primarily due to higher net sales and lower SG&A and R&D expense, partially offset by unfavorable product mix during the period, and operating income as a percentage of net sales increased during the period primarily due to lower SG&A and R&D expense in the first quarter of 2025.

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Instrumentation

			First Quarter												Change
(dollars in millions)			2025						2024						$						%
Net sales			$	343.3					$	330.4					$	12.9					3.9		%
Cost of sales			$	173.5					$	171.2					$	2.3					1.3		%
Selling, general and administrative expense			$	49.7					$	47.0					$	2.7					5.7		%
Research and development expense			$	24.2					$	22.8					$	1.4					6.1		%
Acquired intangible asset amortization			$	3.2					$	3.4					$	(0.2)					(5.9)		%
Operating income			$	92.7					$	86.0					$	6.7					7.8		%
As a percentage of net sales:
Cost of sales			50.5		%				51.8		%
Selling, general and administrative expense			14.5		%				14.2		%
Research and development expense			7.0		%				6.9		%
Acquired intangible asset amortization			1.0		%				1.1		%
Operating income			27.0		%				26.0		%

First quarter of 2025 compared with the first quarter of 2024

Net sales increased due to higher sales in our Marine Instrumentation and Test and Measurement Instrumentation product lines, partially offset by lower sales at our Environmental Instrumentation product line. Sales of Marine Instrumentation increased $14.0 million due to the ongoing recovery in offshore energy markets as well as stronger defense market sales. Sales of Test and Measurement Instrumentation increased $1.1 million, and sales of Environmental Instrumentation decreased $2.2 million. The first quarter of 2025 included $4.4 million in incremental sales from recent acquisitions.

Cost of sales increased primarily due to higher net sales, partially offset by favorable product mix. The cost of sales percentage decreased due to favorable product mix, including improved margins in our Marine Instrumentation product line. SG&A expense increased due to higher net sales during the period, and SG&A expense as a percentage of net sales increased slightly. R&D expense increased due to higher Marine Instrumentation product development, and the R&D expense percentage was relatively consistent in both periods.

Operating income increased primarily due to higher Marine Instrumentation sales, favorable product mix, and improved Marine Instrumentation margins, and operating income as a percentage of net sales increased due to favorable product mix and improved Marine Instrumentation margins.

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Aerospace and Defense Electronics

			First Quarter												Change
(dollars in millions)			2025						2024						$						%
Net sales			$	242.5					$	185.7					$	56.8					30.6		%
Cost of sales			$	144.2					$	107.9					$	36.3					33.6		%
Selling, general and administrative expense			$	33.2					$	21.0					$	12.2					58.1		%
Research and development expense			$	6.0					$	4.7					$	1.3					27.7		%
Acquired intangible asset amortization			$	3.4					$	0.2					$	3.2					*
Operating income			$	55.7					$	51.9					$	3.8					7.3		%
As a percentage of net sales:
Cost of sales			59.5		%				58.1		%
Selling, general and administrative expense			13.7		%				11.3		%
Research and development expense			2.5		%				2.5		%
Acquired intangible asset amortization			1.3		%				0.1		%
Operating income			23.0		%				28.0		%

• Not meaningful

First quarter of 2025 compared with the first quarter of 2024

Net sales increased due to a $57.1 million increase in defense electronics, partially offset by a $0.3 million decrease in aerospace electronics. The first quarter of 2025 included $42.3 million in incremental sales from recent acquisitions.

Cost of sales increased due to higher net sales, partially offset by unfavorable product mix, including recent acquisitions which carry a higher cost of sales percentage, and the cost of sales percentage increased due to unfavorable product mix. SG&A expense increased due to higher net sales as well as $3.2 million of transaction and integration costs for 2025 acquisitions incurred in the first quarter of 2025, with no comparable amount recorded in the first quarter of 2024. R&D expense increased due to primarily to the 2025 acquisitions, and the R&D expense percentage was similar in both periods.

Operating income increased primarily due to increased net sales, and operating income as a percent of net sales decreased primarily due higher transaction and integration costs as well as unfavorable product mix.

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Engineered Systems

			First Quarter												Change
(dollars in millions)			2025						2024						$						%
Net sales			$	107.1					$	93.2					$	13.9					14.9		%
Cost of sales			$	90.2					$	82.5					$	7.7					9.3		%
Selling, general and administrative expense			$	6.1					$	7.9					$	(1.8)					(22.8)		%
Research and development expense			$	—					$	0.1					$	(0.1)					(100.0)		%
Operating income			$	10.8					$	2.7					$	8.1					300.0		%
As percentage of net sales:
Cost of sales			84.2		%				88.5		%
Selling, general and administrative expense			5.7		%				8.5		%
Research and development expense			—		%				0.1		%
Operating income			10.1		%				2.9		%

First quarter of 2025 compared with the first quarter of 2024

Net sales increased due to higher sales of $14.2 million for engineered products, partially offset by a $0.3 million decrease in energy systems.

Cost of sales increased primarily due to higher net sales, and the cost of sales percentage decreased during the period due to favorable program mix. SG&A expense decreased primarily due to lower selling expense, and SG&A expense as a percentage of net sales decreased.

Operating income and operating income as a percentage of net sales increased primarily due to higher net sales, lower selling expense and favorable program mix.

Financial Condition, Liquidity and Capital Resources

Our principal cash and capital requirements are to fund working capital needs, capital expenditures, income tax payments, and debt service requirements as well as acquisitions. We may deploy cash for the stock repurchase program. It is anticipated that cash on hand, operating cash flow, together with available borrowings under our $1.20 billion credit facility, will be sufficient to meet these requirements. To support acquisitions, we may need to raise additional capital. No cash pension contributions have been made since 2013 or are planned for the remainder of 2025 for the domestic qualified pension plans.

Cash and Cash Equivalents

Cash and cash equivalents totaled $461.5 million at March 30, 2025, compared with $649.8 million at December 29, 2024. Cash equivalents consist of highly liquid money-market mutual funds, with maturities of three months or less when purchased.

Long-term Debt

Total debt at March 30, 2025, was $2,964.8 million compared with $2,649.0 million at December 29, 2024, with the increase due to borrowings under the credit facility to support acquisition activity in the first quarter of 2025.

At March 30, 2025, $855.5 million was available under the $1.20 billion credit facility, after reductions of $315.0 million in outstanding borrowings and $29.5 million in outstanding letters of credit.

Our bank credit agreements, which includes our $1.20 billion credit facility expiring June 2029, require us to comply with various financial and operating covenants. At March 30, 2025, we were in compliance with these covenants.

Our liquidity is not dependent upon the use of off-balance sheet financial arrangements. We have no off-balance sheet financing arrangements that incorporate the use of special purpose entities or unconsolidated entities.

We may at any time and from time to time seek to retire or purchase our outstanding debt through cash purchases in open-market purchases, privately negotiated transactions or otherwise. Such repurchases, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

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Stock Repurchases

In April 2024, our Board of Directors approved a stock repurchase program authorizing the Company to repurchase up to $1.25 billion of our common stock. This authorization superseded prior open stock repurchase programs authorized by the Board of Directors. The newly authorized stock repurchase program does not have a stated expiration date. Shares may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions or via an accelerated stock repurchase program. Shares could be repurchased in a plan pursuant to Rule 10b5-1 of the Securities Exchange Act of 1934. The repurchase program is expected to remain open continuously, and the number of shares purchased will depend on a variety of factors such as share price, levels of cash available, acquisitions and alternative investment opportunities available immediately or longer-term, and other regulatory, market or economic conditions. We currently intend to fund future share repurchases with cash on hand and available borrowings under our credit facility. No repurchases under any authorizations were made in the first quarter of 2025 or 2024.

Cash Flows

Net cash provided by operating activities was $242.6 million for the first three months of 2025 compared with $291.0 million, with the decrease driven primarily by cash outflows on foreign exchange contracts in the first quarter of 2025 as compared to cash inflows on foreign exchange contracts in the first quarter of 2024 as well as lower customer advances received in the first quarter of 2025.

Net cash used in investing activities was $775.0 million for the first three months of 2025 compared with $15.9 million. During the first three months of 2025, we spent $757.6 million on acquisitions, with no comparable spend for the first three months of 2024. Capital expenditures for the first three months of 2025 and 2024 were $18.0 million and $15.9 million, respectively. We currently plan to invest approximately $130 million for capital expenditures in 2025.

Net cash provided by financing activities was $339.6 million for the first three months of 2025 compared with net cash provided by financing activities of $6.1 million, with the first three months of 2025 including net proceeds from our credit facility of $315.0 million.

Critical Accounting Policies and Estimates

Our critical accounting policies and estimates are those that are reflective of significant judgments and uncertainties and may potentially result in materially different results under different assumptions and conditions. Our critical accounting policies are the following: accounting for revenue recognition; accounting for business combinations, goodwill, and acquired intangible assets; and accounting for income taxes.

For additional discussion of the application of the critical accounting policies and other accounting policies, see Note 1 to the Condensed Consolidated Financial Statements and also Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies and Note 2 of the Notes to Consolidated Financial Statements included in Teledyne’s 2024 Form 10-K.

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Safe Harbor Cautionary Statement Regarding Forward-Looking Information

From time to time we make, and this report contains, forward looking statements, as defined in the Private Securities Litigation Reform Act of 1995, with respect to management’s beliefs about the financial condition, results of operations, acquisitions, capital expenditures and product synergies, integration costs, tax matters and businesses of Teledyne in the future. Forward-looking statements involve risks and uncertainties, are based on the current expectations of the management of Teledyne and are subject to uncertainty and changes in circumstances. All statements made in this Management’s Discussion and Analysis of Financial Condition and Results of Operations and in other sections of this Form 10-Q that are not historical in nature should be considered forward-looking. Actual results could differ materially from these forward-looking statements.

Many factors could change anticipated results, including: the impact of policies of the U.S. Presidential Administration, especially with respect to new and higher tariffs, cutbacks in the funding of government agencies and programs, and the scaling back of environmental and green energy policies; escalating economic and diplomatic tension between China and the United States, including a potential “trade war” that results in higher tariffs and restrictions on sales of goods and services; reciprocal tariffs from other countries; changes in relevant tax and other laws; foreign currency exchange risks; rising interest rates and inflation; risks associated with indebtedness, as well as our ability to reduce indebtedness and the timing thereof; the impact of semiconductor and other supply chain shortages; higher inflation, including wage competition and higher shipping costs; labor shortages and competition for skilled personnel; the inability to develop and market new competitive products; inherent uncertainties involved in the estimates and judgments used in the preparation of financial statements and the providing of estimates of financial measures, in accordance with GAAP and related standards; disruptions in the global economy; the ongoing conflict in Israel and neighboring regions, including related protests, attacks on defense contractors and suppliers and the disruption to global shipping routes; the ongoing conflict between Russia and Ukraine, including the impact to energy prices and availability, especially in Europe; customer and supplier bankruptcies; changes in demand for products sold to the defense electronics, instrumentation, digital imaging, energy exploration and production, commercial aviation, semiconductor and communications markets; funding, continuation and award of government programs; cuts to defense spending resulting from existing and future deficit reduction measures or changes to U.S. and foreign government spending and budget priorities triggered by inflation, rising interest costs, and economic conditions; the continuing review and resolution of FLIR’s trade compliance and tax matters; threats to the security of our confidential and proprietary information, including cybersecurity threats; risks related to artificial intelligence; natural and man-made disasters; and our ability to achieve emission reduction targets and decrease our carbon footprint. Lower oil and natural gas prices, as well as instability in the Middle East or other oil producing regions, and new regulations or restrictions relating to energy production could further negatively affect our businesses that supply the oil and gas industry. Weakness in the commercial aerospace industry negatively affects the markets of our commercial aviation businesses. Lower aircraft production rates at Boeing or Airbus could result in reduced sales of our commercial aerospace products. In addition, financial market fluctuations affect the value of the company’s pension assets. Changes in the policies of the United States and foreign governments, including economic sanctions or in regard to support Ukraine, could result, over time, in reductions or realignment in defense or other government spending and further changes in programs in which the company participates.

While the Company’s growth strategy includes possible acquisitions, we cannot provide any assurance as to when, if or on what terms any acquisitions will be made. Acquisitions involve various inherent risks, such as, among others, our ability to integrate acquired businesses, retain key management and customers and achieve identified financial and operating synergies. There are additional risks associated with acquiring, owning and operating businesses internationally, including those arising from U.S. and foreign government policy changes or actions and exchange rate fluctuations.

We continue to take action to assure compliance with the internal controls, disclosure controls and other requirements of the Sarbanes-Oxley Act of 2002. While we believe our control systems are effective, there are inherent limitations in all control systems, and misstatements due to error or fraud may occur and may not be detected.

Readers are urged to read our periodic reports filed with the SEC for a more complete description of our Company, its businesses, its strategies and the various risks that we face. Various risks are identified in our 2024 Form 10-K and subsequent Quarterly Reports on Form 10-Q.

All forward-looking statements speak only as of the date they are made and are based on information available at that time. We assume no obligation to publicly update or revise any forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements were made or to reflect the occurrence of unanticipated events except as required by federal securities laws. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance on such statements.