Item 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

TRIMBLE INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

			First Quarter of						Year End
As of			2022						2021
(In millions, except par value)
ASSETS
Current assets:
Cash and cash equivalents			$	357.2					$	325.7
Accounts receivable, net			655.7						624.8
Inventories			401.0						363.3
Other current assets			151.6						136.8
Total current assets			1,565.5						1,450.6
Property and equipment, net			235.0						233.2
Operating lease right-of-use assets			146.9						141.0
Goodwill			3,971.0						3,981.5
Other purchased intangible assets, net			468.7						506.6
Deferred income tax assets			494.9						502.0
Other non-current assets			295.4						284.7
Total assets			$	7,177.4					$	7,099.6
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable			$	213.3					$	207.3
Accrued compensation and benefits			144.6						231.0
Deferred revenue			622.7						548.8
Other current liabilities			266.4						201.5
Total current liabilities			1,247.0						1,188.6
Long-term debt			1,293.7						1,293.2
Deferred revenue, non-current			81.2						83.0
Deferred income tax liabilities			237.6						263.1
Income taxes payable			54.5						54.5
Operating lease liabilities			127.8						121.4
Other non-current liabilities			147.7						151.1
Total liabilities			3,189.5						3,154.9
Commitments and contingencies (Note 12)
Stockholders' equity:
Preferred stock, $0.001 par value; 3.0 shares authorized; none issued and outstanding			—						—
Common stock, $0.001 par value; 360.0 shares authorized; 250.1 and 250.9 shares issued and outstanding at the end of the first quarter of 2022 and year end 2021			0.3						0.3
Additional paid-in-capital			1,981.2						1,935.6
Retained earnings			2,170.3						2,170.5
Accumulated other comprehensive loss			(163.9)						(161.7)
Total stockholders' equity			3,987.9						3,944.7
Total liabilities and stockholders' equity			$	7,177.4					$	7,099.6

See accompanying Notes to the Condensed Consolidated Financial Statements.

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TRIMBLE INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

			First Quarter of
(In millions, except per share amounts)			2022						2021
Revenue:
Product			$	621.6					$	539.4
Service			161.1						162.3
Subscription			211.0						184.8
Total revenue			993.7						886.5
Cost of sales:
Product			308.4						255.7
Service			63.3						59.6
Subscription			49.9						55.8
Amortization of purchased intangible assets			22.5						22.1
Total cost of sales			444.1						393.2
Gross margin			549.6						493.3
Operating expense:
Research and development			140.3						129.4
Sales and marketing			131.9						122.4
General and administrative			101.5						85.4
Restructuring			6.9						1.5
Amortization of purchased intangible assets			12.1						13.7
Total operating expense			392.7						352.4
Operating income			156.9						140.9
Non-operating expense, net:
Interest expense, net			(16.0)						(16.9)
Income from equity method investments, net			9.7						11.8
Other income (expense), net			(12.1)						1.6
Total non-operating expense, net			(18.4)						(3.5)
Income before taxes			138.5						137.4
Income tax provision			28.2						22.8
Net income			110.3						114.6
Net income attributable to noncontrolling interests			—						0.1
Net income attributable to Trimble Inc.			$	110.3					$	114.5
Earnings per share attributable to Trimble Inc.:
Basic			$	0.44					$	0.46
Diluted			$	0.44					$	0.45
Shares used in calculating earnings per share:
Basic			250.8						251.1
Diluted			252.8						254.3

See accompanying Notes to the Condensed Consolidated Financial Statements.

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TRIMBLE INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

			First Quarter of
			2022						2021
(In millions)
Net income			$	110.3					$	114.6
Foreign currency translation adjustments, net of tax			(2.2)						(31.5)
Comprehensive income			108.1						83.1
Comprehensive income attributable to noncontrolling interests			—						0.1
Comprehensive income attributable to Trimble Inc.			$	108.1					$	83.0

See accompanying Notes to the Condensed Consolidated Financial Statements.

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TRIMBLE INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(UNAUDITED)

			Common stock																		Retained Earnings						Accumulated Other Comprehensive Loss						Total Stockholders’ Equity						Noncontrolling Interest						Total
			Shares						Amount						Additional Paid-In Capital
(In millions)
Balance at the end of 2021			250.9						$	0.3					$	1,935.6					$	2,170.5					$	(161.7)					$	3,944.7					$	—					$	3,944.7
Net income			—						—						—						110.3						—						110.3						—						110.3
Other comprehensive loss			—						—						—						—						(2.2)						(2.2)						—						(2.2)
Comprehensive income																																	108.1												108.1
Issuance of common stock under employee plans, net of tax withholdings			0.7						—						15.2						(17.6)						—						(2.4)						—						(2.4)
Stock repurchases			(1.5)						—						(11.8)						(92.9)						—						(104.7)						—						(104.7)
Stock-based compensation			—						—						42.2						—						—						42.2						—						42.2
Balance at the end of the first quarter of 2022			250.1						$	0.3					$	1,981.2					$	2,170.3					$	(163.9)					$	3,987.9					$	—					$	3,987.9

			Common stock																		Retained Earnings						Accumulated Other Comprehensive Loss						Total Stockholders’ Equity						Noncontrolling Interest						Total
			Shares						Amount						Additional Paid-In Capital
(In millions)
Balance at the end of 2020			250.8						$	0.3					$	1,801.7					$	1,893.4					$	(98.5)					$	3,596.9					$	1.7					$	3,598.6
Net income			—						—						—						114.5						—						114.5						0.1						114.6
Other comprehensive loss			—						—						—						—						(31.5)						(31.5)						—						(31.5)
Comprehensive income																																	83.0												83.1
Issuance of common stock under employee plans, net of tax withholdings			0.7						—						18.2						(10.2)						—						8.0						—						8.0
Stock repurchases			(0.6)						—						(4.1)						(35.9)						—						(40.0)						—						(40.0)
Stock-based compensation			—						—						25.1						—						—						25.1						—						25.1
Noncontrolling interest investment			—						—						0.6						—						—						0.6						(1.8)						(1.2)
Balance at the end of the first quarter of 2021			250.9						$	0.3					$	1,841.5					$	1,961.8					$	(130.0)					$	3,673.6					$	—					$	3,673.6

See accompanying Notes to the Condensed Consolidated Financial Statements.

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TRIMBLE INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

			First Quarter of
(In millions)			2022						2021
Cash flow from operating activities:
Net income			$	110.3					$	114.6
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation expense			10.0						10.3
Amortization expense			34.6						35.8
Deferred income taxes			(16.8)						0.4
Stock-based compensation			28.3						27.2
Other, net			16.7						(3.8)
(Increase) decrease in assets:
Accounts receivable, net			(34.6)						40.0
Inventories			(42.7)						(0.9)
Other current and non-current assets			(14.6)						2.8
Increase (decrease) in liabilities:
Accounts payable			7.8						14.5
Accrued compensation and benefits			(75.6)						(25.0)
Deferred revenue			73.3						9.2
Other current and non-current liabilities			56.3						3.1
Net cash provided by operating activities			153.0						228.2
Cash flow from investing activities:
Purchases of property and equipment			(14.5)						(10.6)
Other, net			1.1						1.4
Net cash used in investing activities			(13.4)						(9.2)
Cash flow from financing activities:
Issuance of common stock, net of tax withholdings			(2.4)						8.0
Repurchases of common stock			(104.7)						(40.0)
Proceeds from debt and revolving credit lines			118.8						180.8
Payments on debt and revolving credit lines			(118.8)						(335.7)
Other, net			(2.6)						—
Net cash used in financing activities			(109.7)						(186.9)
Effect of exchange rate changes on cash and cash equivalents			1.6						(5.2)
Net increase in cash and cash equivalents			31.5						26.9
Cash and cash equivalents - beginning of period			325.7						237.7
Cash and cash equivalents - end of period			$	357.2					$	264.6

See accompanying Notes to the Condensed Consolidated Financial Statements.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

NOTE 1. OVERVIEW AND ACCOUNTING POLICIES

Basis of Presentation

The Condensed Consolidated Financial Statements include our results of our consolidated subsidiaries. Intercompany accounts and transactions have been eliminated. Noncontrolling interests represent the noncontrolling stockholders’ proportionate share of the net assets and results of operations of our consolidated subsidiaries.

We use a 52- to 53-week year ending on the Friday nearest to December 31. Both 2022 and 2021 are 52-week years. The first quarter of 2022 and 2021 ended on April 1, 2022 and April 2, 2021. Unless otherwise stated, all dates refer to these periods.

Use of Estimates

We prepared our interim Condensed Consolidated Financial Statements that accompany these notes in conformity with U.S. GAAP, consistent in all material respects with those applied in our Form 10-K filed with the U.S. Securities and Exchange Commission on February 23, 2022 (the “2021 Form 10-K”).

The interim financial information is unaudited, and reflects all normal adjustments that are, in our opinion, necessary to provide a fair statement of results for the interim periods presented. This report should be read in conjunction with our 2021 Form 10-K that includes additional information about our significant accounting policies and the methods and assumptions used in our estimates.

The preparation of financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Estimates and assumptions are used for revenue recognition, including determining the nature and timing of satisfaction of performance obligations and determining standalone selling price (“SSP”) of performance obligations, provision for credit losses, sales returns reserve, inventory valuation, warranty costs, investments, acquired intangibles, goodwill and intangible asset impairment analysis, other long-lived asset impairment analysis, stock-based compensation, and income taxes. We base our estimates on historical experience and various other assumptions we believe to be reasonable. Actual results that we experience may differ materially from our estimates.

Recently issued Accounting Pronouncements not yet Adopted

There are no recently issued accounting pronouncements applicable to us not yet adopted.

Recently Adopted Accounting Pronouncements

There are no recently adopted accounting pronouncements.

NOTE 2. STOCKHOLDERS’ EQUITY

Stock Repurchase Activities

In August 2021, our Board of Directors approved a new share repurchase program (“2021 Stock Repurchase Program”) authorizing up to $750.0 million in repurchases of our common stock. Under the 2021 Stock Repurchase Program, the share repurchase authorization does not have an expiration date and supersedes and replaces the $600.0 million share repurchase authorization approved by our Board of Directors in November 2017 (“2017 Stock Repurchase Program”), of which $50.7 million was remaining and has been cancelled.

Under the 2021 Stock Repurchase Program, we may repurchase shares from time to time, subject to business and market conditions and other investment opportunities, through open market transactions, privately-negotiated transactions, accelerated stock repurchase plans, or by other means. The timing and actual number of any shares repurchased will depend on a variety of factors, including market conditions, our share price, other available uses of capital, applicable legal requirements, and other factors. The 2021 Stock Repurchase Program may be suspended, modified, or discontinued at any time at the Company’s discretion without notice.

During the first quarter of 2022, we repurchased approximately 1.5 million shares of common stock in open market purchases at an average price of $68.49 per share for a total of $104.7 million under the 2021 Stock Repurchase Program. At the end of the first quarter of 2022, the 2021 Stock Repurchase Program had remaining authorized funds of $505.3 million.

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During the first quarter of 2021, we repurchased approximately 0.6 million shares of common stock in open market purchases at an average price of $71.24 per share for a total of $40.0 million under the 2017 Stock Repurchase Program.

Stock repurchases are reflected as a decrease to common stock based on par value and additional-paid-in-capital, based on the average book value per share for all outstanding shares calculated at the time of each individual repurchase transaction. The excess of the purchase price over this average for each repurchase was charged to retained earnings. Common stock repurchases under the program were recorded based upon the trade date for accounting purposes.

NOTE 3. INTANGIBLE ASSETS AND GOODWILL

Intangible Assets

The following table presents a summary of our intangible assets:

			First Quarter of 2022																		Year End 2021
			Gross																		Gross
			Carrying						Accumulated						Net Carrying						Carrying						Accumulated						Net Carrying
(In millions)			Amount						Amortization						Amount						Amount						Amortization						Amount
Developed product technology			$	1,009.1					$	(767.6)					$	241.5					$	1,011.9					$	(748.2)					$	263.7
Customer relationships			649.5						(431.9)						217.6						667.8						(428.9)						238.9
Trade names and trademarks			47.9						(39.3)						8.6						48.0						(45.0)						3.0
Distribution rights and other intellectual property			10.0						(9.0)						1.0						10.0						(9.0)						1.0
			$	1,716.5					$	(1,247.8)					$	468.7					$	1,737.7					$	(1,231.1)					$	506.6

The estimated future amortization expense of intangible assets at the end of the first quarter of 2022 was as follows:

(In millions)
2022 (Remaining)			$	91.4
2023			113.4
2024			89.8
2025			56.0
2026			49.7
Thereafter			68.4
Total			$	468.7

Goodwill

The changes in the carrying amount of goodwill by segment for the first quarter of 2022 were as follows:

			Buildings and Infrastructure						Geospatial						Resources and Utilities						Transportation						Total
(In millions)
Balance as of year end 2021			$	2,141.4					$	403.6					$	440.8					$	995.7					$	3,981.5
Foreign currency translation and other adjustments			(6.5)						(1.5)						0.6						(3.1)						(10.5)
Balance as of the end of the first quarter of 2022			$	2,134.9					$	402.1					$	441.4					$	992.6					$	3,971.0

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NOTE 4. INVENTORIES

The components of inventory, net were as follows:

			First Quarter of						Year End
As of			2022						2021
(In millions)
Raw materials			$	145.4					$	129.6
Work-in-process			13.5						12.4
Finished goods			242.1						221.3
Total inventories			$	401.0					$	363.3

NOTE 5. SEGMENT INFORMATION

We determined our operating segments based on how our Chief Operating Decision Maker (“CODM”) views and evaluates operations. Our reportable segments are described below:

• Buildings and Infrastructure**. This segment primarily serves customers working in architecture, engineering, construction, and operations and maintenance.

• Geospatial**. This segment primarily serves customers working in surveying, engineering, and government.

• Resources and Utilities**. This segment primarily serves customers working in agriculture, forestry, and utilities.

• Transportation**. This segment primarily serves customers working in long haul trucking and freight shipper markets.

The following Reporting Segment tables reflect the results of our reportable operating segments under our management reporting system. These results are not necessarily in conformity with U.S. GAAP. This is consistent with the way the CODM evaluates each of the segment's performance and allocates resources.

			Reporting Segments
			Buildings and Infrastructure						Geospatial						Resources and Utilities						Transportation						Total
(In millions)
First Quarter of 2022
Segment revenue			$	397.6					$	207.5					$	229.9					$	158.7					$	993.7
Segment operating income			$	120.7					$	57.9					$	75.1					$	9.2					$	262.9
Depreciation expense			$	1.6					$	1.6					$	1.5					$	1.0					$	5.7
First Quarter of 2021
Segment revenue			$	343.1					$	181.7					$	205.2					$	156.7					$	886.7
Segment operating income			$	96.4					$	48.7					$	80.1					$	8.4					$	233.6
Depreciation expense			$	1.8					$	1.7					$	1.5					$	0.9					$	5.9

			Reporting Segments
			Buildings and Infrastructure						Geospatial						Resources and Utilities						Transportation						Total
(In millions)
As of the end of the First Quarter of 2022
Accounts receivable, net			$	228.0					$	140.2					$	137.0					$	150.5					$	655.7
Inventories			93.9						140.6						87.9						78.6						401.0
Goodwill			2,134.9						402.1						441.4						992.6						3,971.0
As of Year End 2021
Accounts receivable, net			$	246.8					$	134.0					$	112.9					$	131.1					$	624.8
Inventories			79.3						136.4						67.4						80.2						363.3
Goodwill			2,141.4						403.6						440.8						995.7						3,981.5

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A reconciliation of our condensed consolidated segment operating income to condensed consolidated income before income taxes was as follows:

			First Quarter of
			2022						2021
(In millions)
Consolidated segment operating income			$	262.9					$	233.6
Unallocated general corporate expenses			(29.8)						(24.4)
Purchase accounting adjustments			(34.6)						(34.8)
Acquisition / divestiture items			(3.9)						(3.5)
Stock-based compensation / deferred compensation			(25.0)						(28.7)
Restructuring and other costs			(12.7)						(1.3)
Consolidated operating income			156.9						140.9
Total non-operating expense, net			(18.4)						(3.5)
Consolidated income before taxes			$	138.5					$	137.4

The disaggregation of revenue by geography is summarized in the tables below. Revenue is defined as revenue from external customers attributed to countries based on the location of the customer and is consistent with the Reporting Segment tables above.

			Reporting Segments
			Buildings and Infrastructure						Geospatial						Resources and Utilities						Transportation						Total
(In millions)
First Quarter of 2022
North America			$	231.9					$	83.4					$	59.0					$	124.1					$	498.4
Europe			112.3						71.2						114.0						21.7						319.2
Asia Pacific			46.9						42.0						19.2						7.4						115.5
Rest of World			6.5						10.9						37.7						5.5						60.6
Total segment revenue			$	397.6					$	207.5					$	229.9					$	158.7					$	993.7
First Quarter of 2021
North America			$	199.8					$	72.5					$	53.6					$	124.5					$	450.4
Europe			94.3						60.4						105.8						19.7						280.2
Asia Pacific			43.6						37.5						21.0						7.7						109.8
Rest of World			5.4						11.3						24.8						4.8						46.3
Total segment revenue			$	343.1					$	181.7					$	205.2					$	156.7					$	886.7

Total revenue in the United States as included in the Condensed Consolidated Statements of Income was $447.0 million and $406.8 million for the first quarter of 2022 and 2021. No single customer or country other than the United States accounted for 10% or more of Trimble’s total revenue.

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NOTE 6. DEBT

Debt consisted of the following:

												First Quarter of												Year End
Instrument						Date of Issuance						2022									2021
(In millions)												Effective interest rate
Senior Notes:
2023 Senior Notes, 4.15%, due June 2023						June 2018						4.36%			$	300.0								$	300.0
2028 Senior Notes, 4.90%, due June 2028						June 2018						5.04%			600.0									600.0
2024 Senior Notes, 4.75%, due December 2024						November 2014						4.95%			400.0									400.0
Unamortized discount and issuance costs															(6.3)									(6.8)
Total long-term debt															$	1,293.7								$	1,293.2

Each of our debt agreements, including our credit facilities, requires us to maintain compliance with certain debt covenants, all of which we complied with at the end of the first quarter of 2022.

Debt Maturities

At the end of the first quarter of 2022, our debt maturities based on outstanding principal were as follows (in millions):

Year Payable
2022 (Remaining)			$	—
2023			300.0
2024			400.0
2025			—
2026			—
Thereafter			600.0
Total			$	1,300.0

Senior Notes

All of our senior notes are unsecured obligations. Interest on the senior notes is payable semi-annually in June and December of each year. Additional details are unchanged from the information disclosed in Note 6, “Debt” of the 2021 Form 10-K.

Credit Facilities

On March 24, 2022, we entered into a new credit agreement with a group of lenders (the “2022 Credit Facility”). The 2022 Credit Facility replaces the prior credit facility (the “2018 Credit Facility”), maturing in May 2023, which was terminated concurrently with entering into the 2022 Credit Facility. The 2022 Credit Facility provides for a five-year, unsecured revolving credit facility in the aggregate principal amount of $1.25 billion, and permits us, subject to the satisfaction of certain conditions, to increase the commitments for revolving loans by an aggregate principal amount of up to $500.0 million. The funds available under the 2022 Credit Facility may be used for working capital and general corporate purposes, including the financing of acquisitions. We may borrow, repay, and reborrow funds under the revolving facility until its maturity on March 24, 2027.

The interest rate and commitment fees are based on our current long-term, senior unsecured debt ratings and our leverage ratio. At the end of the first quarter of 2022, the interest rate charged on any outstanding borrowings was the prevailing term secured overnight financing rate for the applicable interest period plus 1.125%, and the commitment fee was 0.125% of the total undrawn commitment. As of April 1, 2022, no amounts were outstanding under the 2022 Credit Facility.

The commitment fee and interest rates are subject to upward or downward adjustments if we achieve, or fail to achieve, certain specified sustainability targets concerning greenhouse gas emission reductions and gender diversity. Such upward or downward adjustments may be up to 0.01% per annum for the commitment fee and up to 0.05% per annum for the interest rate.

Uncommitted Facilities

At the end of the first quarter of 2022, we had two $75.0 million, one €100.0 million, and one £55.0 million revolving credit facilities, which are uncommitted (the “uncommitted facilities”). Generally, these uncommitted facilities may be redeemed upon demand. Borrowings under uncommitted facilities are classified as short-term debt in the Condensed Consolidated Balance Sheet.

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NOTE 7. FAIR VALUE MEASUREMENTS

The following table summarizes the fair values of financial instruments at fair value on a recurring basis for the periods indicated and determined using the following inputs:

			Fair Values as of the end of the First Quarter of 2022																								Fair Values at the end of 2021
			Quoted prices in Active Markets for Identical Assets						Significant Other Observable Inputs						Significant Unobservable Inputs												Quoted prices in Active Markets for Identical Assets						Significant Other Observable Inputs						Significant Unobservable Inputs
(In millions)			(Level I)						(Level II)						(Level III)						Total						(Level I)						(Level II)						(Level III)						Total
Assets
Deferred compensation plan (1)			$	40.4					$	—					$	—					$	40.4					$	44.7					$	—					$	—					$	44.7
Derivatives (2)			—						0.4						—						0.4						—						0.1						—						0.1
Total assets measured at fair value			$	40.4					$	0.4					$	—					$	40.8					$	44.7					$	0.1					$	—					$	44.8
Liabilities
Deferred compensation plan (1)			$	40.4					$	—					$	—					$	40.4					$	44.7					$	—					$	—					$	44.7
Derivatives (2)			—						0.4						—						0.4						—						0.2						—						0.2
Contingent consideration (3)			—						—						13.2						13.2						—						—						12.8						12.8
Total liabilities measured at fair value			$	40.4					$	0.4					$	13.2					$	54.0					$	44.7					$	0.2					$	12.8					$	57.7

(1) Represents a self-directed, non-qualified deferred compensation plan for certain executives and other highly compensated employees included in Other non-current assets and Other non-current liabilities on our Condensed Consolidated Balance Sheets. The plan is invested in actively traded mutual funds and individual stocks valued using observable quoted prices in active markets.

(2) Represents forward currency exchange contracts that are included in Other current assets and Other current liabilities on our Condensed Consolidated Balance Sheets.

(3) Represents arrangements to pay the former owners of certain companies that we acquired that are included in Other current liabilities on our Condensed Consolidated Balance Sheets. The fair values are estimated using scenario-based methods or option pricing methods based upon estimated future revenues, gross margins, or other milestones.

Additional Fair Value Information

The total estimated fair value of all outstanding financial instruments that are not recorded at fair value on a recurring basis (debt) was approximately $1.3 billion and $1.4 billion at the end of the first quarter of 2022 and at the end of 2021.

The fair value of the senior notes was determined based on observable market prices in less active markets and is categorized accordingly as Level II. The fair values do not indicate the amount we would currently have to pay to extinguish the debt.

NOTE 8. PRODUCT WARRANTIES

We accrue for warranty costs as part of our cost of sales based on associated material product costs, technical support, labor costs, and costs incurred by third parties performing work on our behalf. Our expected future costs are primarily estimated based upon historical trends in the volume of product returns within the warranty period and the costs to repair or replace the equipment. When products sold include warranty provisions, they are covered by a warranty for periods ranging generally from one year to two years.

Accrued warranty expense at the end of the first quarter of 2022 and at the end of 2021 was $16.7 million and $17.1 million, and is included in Other current liabilities in our Condensed Consolidated Balance Sheet.

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NOTE 9. DEFERRED REVENUE AND REMAINING PERFORMANCE OBLIGATIONS

Deferred Revenue

Changes in our deferred revenue during the first quarter of 2022 and 2021 were as follows:

			First Quarter of
(In millions)			2022						2021
Beginning balance of the period			$	631.8					$	613.8
Revenue recognized			(234.6)						(247.3)
Billing and other net activities			306.7						252.4
Ending balance of the period			$	703.9					$	618.9

Remaining Performance Obligations

At the end of the first quarter of 2022, approximately $1.7 billion of revenue is expected to be recognized from remaining performance obligations for which goods or services have not been delivered, primarily subscription, software, and software maintenance, and to a lesser extent, hardware and professional services contracts. We expect to recognize $1.3 billion or 75% of our remaining performance obligations as revenue during the next 12 months and the remainder thereafter.

NOTE 10. EARNINGS PER SHARE

Basic earnings per share is computed based on the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share is computed based on the weighted-average number of shares of common stock outstanding during the period plus additional shares of common stock that would have been outstanding if potentially dilutive securities had been issued. Potentially dilutive common shares include outstanding stock options, restricted stock units, contingently issuable shares, and shares to be purchased under our employee stock purchase plan.

The following table shows the computation of basic and diluted earnings per share:

			First Quarter of
			2022						2021
(In millions, except per share amounts)
Numerator:
Net income attributable to Trimble Inc.			$	110.3					$	114.5
Denominator:
Weighted average number of common shares used in basic earnings per share			250.8						251.1
Effect of dilutive securities			2.0						3.2
Weighted average number of common shares and dilutive potential common shares used in diluted earnings per share			252.8						254.3
Basic earnings per share			$	0.44					$	0.46
Diluted earnings per share			$	0.44					$	0.45

Anti-dilutive stock-based awards excluded from the calculations of diluted earnings per share were immaterial during the periods presented.

NOTE 11. INCOME TAXES

Our effective income tax rate for the first quarter of 2022 was 20.4%, as compared to 16.6% in the corresponding period in 2021. The increase was primarily due to a one-time tax benefit from foreign income tax refunds in 2021.

We and our subsidiaries are subject to U.S. federal, state, and foreign income taxes. Currently, we are in different stages of multiple year examinations by various state and foreign taxing authorities. While we believe our reserves are more likely than not to be adequate to cover final resolution of all open tax matters, it is reasonably possible that future obligations related to these matters could arise.

Unrecognized tax benefits of $49.9 million and $42.3 million at the end of the first quarter of 2022 and at the end of 2021, if recognized, would favorably affect the effective income tax rate in future periods. At the end of the first quarter of 2022 and at

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the end of 2021, we accrued interest and penalties of $10.5 million and $9.2 million. Although timing of the resolution and/or closure of audits is not certain, we do not believe that our gross unrecognized tax benefits would materially change in the next twelve months.

Income tax payable at the end of the first quarter of 2022 and at the end of 2021 was $63.4 million and $47.1 million, and is included in Other current liabilities in our Condensed Consolidated Balance Sheet.

NOTE 12. C****OMMITMENTS AND CONTINGENCIES

Commitments

At the end of the first quarter of 2022, we had unconditional purchase obligations of approximately $752.2 million. These unconditional purchase obligations primarily represent open non-cancellable purchase orders for material purchases with our vendors and investments in our platform associated with our Connect and Scale strategy.

Litigation

From time to time, we are involved in litigation arising in the ordinary course of our business. There are no material legal proceedings, other than ordinary routine litigation incidental to the business, that we or any of our subsidiaries is a party, or that any of our or our subsidiaries' property is subject.

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