Item 1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)

VERTIV HOLDINGS CO

(Dollars in millions except for per share data)

															Three months ended March 31, 2022						Three months ended March 31, 2021
Net sales
Net sales - products															$	849.4					$	803.7
Net sales - services															307.0						294.7
Net sales															1,156.4						1,098.4
Costs and expenses
Cost of sales - products															655.8						563.6
Cost of sales - services															197.0						176.8
Cost of sales															852.8						740.4
Operating expenses
Selling, general and administrative expenses															292.2						250.1
Amortization of intangibles															57.7						31.8
Restructuring costs															0.8						2.0
Foreign currency (gain) loss, net															(1.3)						(6.9)
Other operating expense (income)															(0.6)						1.2
Operating profit (loss)															(45.2)						79.8
Interest expense, net															29.3						24.1
Loss on extinguishment of debt															—						0.4
Change in fair value of warrant liabilities															(94.9)						13.6
Income (loss) before income taxes															20.4						41.7
Income tax expense															11.9						10.0
Net income (loss)															$	8.5					$	31.7
Earnings (loss) per share:
Basic															$	0.02					$	0.09
Diluted															$	(0.23)					$	0.09
Weighted-average shares outstanding:
Basic															375,972,294						349,603,701
Diluted															379,692,729						353,448,585

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

VERTIV HOLDINGS CO

(Dollars in millions)

															Three months ended March 31, 2022						Three months ended March 31, 2021
Net income (loss)															$	8.5					$	31.7
Other comprehensive income (loss), net of tax:
Foreign currency translation															(36.3)						(36.1)
Interest rate swaps															54.2						33.9
Tax receivable agreement															—						4.1
Pension															0.1						(0.8)
Other comprehensive income (loss), net of tax															18.0						1.1
Comprehensive income (loss)															$	26.5					$	32.8

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

VERTIV HOLDINGS CO

(Dollars in millions)

			March 31, 2022						December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents			$	288.5					$	439.1
Accounts receivable, less allowances of $15.2 and $14.1, respectively			1,534.3						1,536.4
Inventories			774.5						616.3
Other current assets			126.7						106.8
Total current assets			2,724.0						2,698.6
Property, plant and equipment, net			485.3						489.3
Other assets:
Goodwill			1,317.7						1,330.1
Other intangible assets, net			2,055.2						2,138.2
Deferred income taxes			51.7						47.9
Other			277.1						235.5
Total other assets			3,701.7						3,751.7
Total assets			$	6,911.0					$	6,939.6
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt			$	21.8					$	21.8
Accounts payable			887.5						858.5
Accrued expenses and other liabilities			972.3						953.4
Income taxes			22.2						21.1
Total current liabilities			1,903.8						1,854.8
Long-term debt, net			2,946.3						2,950.5
Deferred income taxes			194.7						198.8
Warrant liabilities			54.7						149.6
Other long-term liabilities			357.4						368.2
Total liabilities			5,456.9						5,521.9
Equity
Preferred stock, $0.0001 par value, 5,000,000 shares authorized, none issued and outstanding			—						—
Common stock, $0.0001 par value, 700,000,000 shares authorized, 375,991,964 and 375,801,857 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively			—						—
Additional paid-in capital			2,607.4						2,597.5
Accumulated deficit			(1,206.9)						(1,215.4)
Accumulated other comprehensive (loss) income			53.6						35.6
Total equity			1,454.1						1,417.7
Total liabilities and equity			$	6,911.0					$	6,939.6

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW

VERTIV HOLDINGS CO

(Dollars in millions)

			Three months ended March 31, 2022						Three months ended March 31, 2021
Cash flows from operating activities:
Net income (loss)			$	8.5					$	31.7
Adjustments to reconcile net income (loss) to net cash used for operating activities:
Depreciation			17.9						16.9
Amortization			61.3						35.3
Deferred income taxes			(4.6)						(7.5)
Amortization of debt discount and issuance costs			2.3						1.8
Loss on extinguishment of debt			—						0.4
Change in fair value of warrant liabilities			(94.9)						13.6
Changes in operating working capital			(116.1)						(44.6)
Stock based compensation			6.6						5.6
Payment of contingent consideration			(8.7)						—
Changes in tax receivable agreement			—						1.8
Other			(4.5)						5.7
Net cash provided by (used for) operating activities			(132.2)						60.7
Cash flows from investing activities:
Capital expenditures			(15.1)						(16.8)
Investments in capitalized software			(3.1)						(1.1)
Net cash used for investing activities			(18.2)						(17.9)
Cash flows from financing activities:
Borrowings from ABL revolving credit facility and short-term borrowings			75.8						—
Repayments of ABL revolving credit facility and short-term borrowings			(60.0)						—
Repayment of long-term debt			(5.5)						(5.5)
Proceeds from the exercise of warrants			—						107.5
Payment of contingent consideration			(12.8)						—
Exercise of employee stock options			1.0						0.9
Net cash provided by (used for) financing activities			(1.5)						102.9
Effect of exchange rate changes on cash and cash equivalents			1.3						(3.1)
Increase (decrease) in cash, cash equivalents and restricted cash			(150.6)						142.6
Beginning cash, cash equivalents and restricted cash			447.1						542.6
Ending cash, cash equivalents and restricted cash			$	296.5					$	685.2
Changes in operating working capital
Accounts receivable			$	(4.8)					$	47.1
Inventories			(160.4)						(68.4)
Other current assets			(14.5)						(5.3)
Accounts payable			33.0						20.7
Accrued expenses and other liabilities			30.5						(41.5)
Income taxes			0.1						2.8
Total changes in operating working capital			$	(116.1)					$	(44.6)

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT)

VERTIV HOLDINGS CO

(Dollars in millions)

						Share Capital
						Shares						Amount						Additional Paid in Capital						Accumulated Deficit						Accumulated Other Comprehensive Income (Loss)						Total
Balance at December 31, 2020						342,024,612						—						1,791.8						(1,331.2)						51.5						512.1
Net income (loss)						—						—						—						31.7						—						31.7
Exercise of employee stock options						76,047						—						0.9						—						—						0.9
Employee 401K match with Vertiv stock						69,309						—						1.3						—						—						1.3
Exercise of warrants (1)						9,346,822						—						176.0						—						—						176.0
Stock-based compensation						—						—						5.6						—						—						5.6
Other comprehensive income (loss), net of tax						—						—						—						—						1.1						1.1
Balance at March 31, 2021						351,516,790						$	—					$	1,975.6					$	(1,299.5)					$	52.6					$	728.7
Balance at December 31, 2021						375,801,857						$	—					$	2,597.5					$	(1,215.4)					$	35.6					$	1,417.7
Net income (loss)						—						—						—						8.5						—						8.5
Exercise of employee stock options						89,566						—						1.0						—						—						1.0
Stock-based compensation						—						—						6.6						—						—						6.6
Employee 401K match with Vertiv stock						100,541						—						2.3						—						—						2.3
Other comprehensive income (loss), net of tax						—						—						—						—						18.0						18.0
Balance at March 31, 2022						375,991,964						$	—					$	2,607.4					$	(1,206.9)					$	53.6					$	1,454.1

(1)The exercise of warrants includes $107.5 of cash received during the three months ended March 31, 2021 for the exercise of Public Warrants.

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements

Vertiv Holdings Co

Notes to Condensed Consolidated Financial Statements (Unaudited)

(Dollars in millions, except as otherwise specified and per share amounts)

(1) DESCRIPTION OF BUSINESS

Vertiv Holdings Co ("Holdings Co", and together with its majority-owned subsidiaries, “Vertiv”, "we", "our", or "the Company"), formerly known as GS Acquisition Holdings Corp, provides mission-critical infrastructure technologies and life cycle services for data centers, communication networks, and commercial and industrial environments. Vertiv’s offerings include power conditioning and uninterruptible power systems, thermal management, integrated data center control devices, software, monitoring, and service. Vertiv manages and reports results of operations for three reportable segments: Americas; Asia Pacific; and Europe, Middle East & Africa.

(2) BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The unaudited condensed consolidated interim financial statements have been prepared in accordance with generally accepted accounting principles ("GAAP") in the United States of America and the rules and regulations of the Securities and Exchange Commission ("SEC") and include the accounts of the Company and its subsidiaries in which the Company has a controlling interest. These condensed consolidated interim financial statements do not include all of the information and footnotes required for complete financial statements. In management’s opinion, these financial statements reflect all adjustments of a normal, recurring nature necessary for a fair presentation of the results for the interim periods presented.

The presentation of certain prior period amounts have been reclassed to conform with current year presentation. For the three months ended March 31, 2021, $40.3 net sales and $29.8 cost of sales from products was reclassified to services, respectively.

The preparation of financial statements in conformity with GAAP in the United States requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from the estimates. On an ongoing basis, management reviews its estimates based on currently available information. Changes in facts and circumstances may result in revised estimates. Results for these interim periods are not necessarily indicative of results to be expected for the full year due to, among other reasons, the continued uncertainty of general economic conditions due to the COVID-19 pandemic that has impacted, and may continue to impact, our sales channels, supply chain, manufacturing operations, workforce, or other key aspects of our operations.

The notes included herein should be read in conjunction with the Company's audited consolidated financial statements included in the Company's Annual Report on Form 10-K filed with the SEC on March 1, 2022 (the "2021 Form 10-K").

(3) ACQUISITION

On November 1, 2021, the Company, through its wholly-owned subsidiaries Vertiv Holdings Ireland DAC, a private company limited by shares incorporated in Ireland (the "Irish buyer") and Vertiv International Holding Corporation, an Ohio corporation (the “US Buyer” and together with the Irish Buyer, the “Buyers” and each a “Buyer”) acquired (the "Acquisition") the shares of E&I Engineering Ireland Limited, a private company limited by shares incorporated in Ireland, and Powerbar Gulf LLC ("E&I").

As of March 31, 2022 in conjunction with the E&I acquisition, there is $2.2 of contingent earnout related to their projected future results recorded in "Accrued expenses and other liabilities" in the Unaudited Condensed Consolidated Balance Sheets. For the three months ended March 31, 2022 the change in fair value of contingent consideration of $1.5 is included within "Other operating expense (income)" on the Unaudited Condensed Consolidated Statements of Earnings(Loss).

There were no material changes to the purchase price allocation for the three months ended March 31, 2022. The following is the preliminary purchase price allocation of assets acquired and liabilities assumed related to the Acquisition:

						Preliminary Allocation
Accounts receivable						$	87.7
Inventories						50.1
Other current assets						15.7
Property, plant and equipment						87.1
Goodwill						748.2
Other intangible assets						1,004.2
Other assets						10.4
Accounts payable						33.9
Accrued expenses and other liabilities						50.0
Deferred income taxes						129.8
Other long-term liabilities						24.3
Net assets acquired and liabilities assumed						$	1,765.4

Goodwill was calculated as the difference between the acquisition date fair value of the consideration transferred and the fair value of net assets recognized for E&I, and represents the future economic benefits, including synergies, and assembled workforce, that are expected to be achieved as a result of the consummation of the Acquisition of E&I. The goodwill arising from the Acquisition is not expected to be deductible for tax purposes. As of March 31, 2022, goodwill of $273.4 and $474.8 has been allocated to the Americas and the Europe, Middle East and Africa segments, respectively.

The following table represents the definite lived intangible assets acquired, the preliminary fair values and respective useful lives:

						Useful Life						Preliminary Fair Value
Customer relationships						15 to 16 years						$	731.6
Developed technology						13 years						180.7
Trademarks						15 to 16 years						52.3
Backlog						1 year						39.6
Total intangible assets												$	1,004.2

The Company used the multi-period excess earnings method to value the customer relationship intangible assets and the relief from royalty method to value the developed technology intangible assets. The significant assumptions used to estimate the fair value of customer relationships included forecasted earnings before interest, taxes, and amortization, customer attrition rates and a discount rate. The significant assumptions used to estimate the fair value of developed technology included the forecasted revenues, royalty rates and a discount rate. These significant assumptions are forward-looking and could be affected by future economic and market conditions. The estimated weighted-average useful lives was 14.2 years for finite lived intangible assets.

For the three months ended March 31, 2022, E&I net sales were $87.5 which are included in "Net sales" and operating losses of $16.8 were included in "Income (loss) before income taxes, net" on the Unaudited Condensed Consolidated Statement of Earnings (Loss).

Pro Forma Financial Information

In accordance with ASC 805 Business Combination, the following unaudited pro forma results of operations for the three months ended March 31, 2021 assumes the E&I acquisition was completed on January 1, 2020. The following pro forma results include adjustments to reflect acquisition related costs, additional interest expense and amortization of debt issuance costs, accounting policies applied to E&I after the business combination, amortization of intangibles associated with the acquisition and the effects of adjustments made to the carrying value of certain assets.

Unaudited proforma information												Three months ended March 31, 2021
Net sales												$	1,192.8
Net income (loss)												23.9

The unaudited pro forma results contain the following nonrecurring adjustments to give effect to pro forma events that are directly attributable to the transaction, factually supportable, and expected to have a continuing impact on the combined results. Proforma data may not be indicative of the results that would have been obtained had the acquisition occurred at the beginning of the periods presented, nor is it intended to be a projection of future results. Additionally, the pro forma financial information does not reflect the costs which the company has incurred or may incur to integrate the acquired business.

(4) REVENUE

The Company recognizes revenue from the sale of manufactured products and services when control of promised goods or services are transferred to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.

Disaggregation of Revenues

The following table disaggregates our revenue by business segment, product and service offering and timing of transfer of control:

			Three Months Ended March 31, 2022
			Americas						Asia Pacific						Europe, Middle East, & Africa						Total
Sales by Product and Service Offering:
Critical infrastructure & solutions			$	294.3					$	183.8					$	186.8					$	664.9
Services & spares			164.7						104.6						64.9						334.2
Integrated rack solutions			76.1						44.4						36.8						157.3
Total			$	535.1					$	332.8					$	288.5					$	1,156.4
Timing of revenue recognition:
Products and services transferred at a point in time			$	378.1					$	256.4					$	221.7					$	856.2
Products and services transferred over time			157.0						76.4						66.8						300.2
Total			$	535.1					$	332.8					$	288.5					$	1,156.4

			Three Months Ended March 31, 2021
			Americas						Asia Pacific						Europe, Middle East, & Africa						Total
Sales by Product and Service Offering:
Critical infrastructure & solutions			$	279.2					$	216.3					$	132.4					$	627.9
Services & spares			154.2						95.5						72.1						321.8
Integrated rack solutions			68.1						45.6						35.0						148.7
Total			$	501.5					$	357.4					$	239.5					$	1,098.4
Timing of revenue recognition:
Products and services transferred at a point in time			$	360.5					$	281.6					$	195.0					$	837.1
Products and services transferred over time			141.0						75.8						44.5						261.3
Total			$	501.5					$	357.4					$	239.5					$	1,098.4

The opening and closing balances of our current and long-term contract assets and current and long-term deferred revenue were as follows:

			Balances at March 31, 2022						Balances at December 31, 2021
Deferred revenue - current (1)			$	293.9					$	238.9
Deferred revenue - noncurrent (2)			50.0						59.9
Other contract liabilities - current (1)			60.3						52.1

(1) Current deferred revenue and contract liabilities are included within accrued expenses and other liabilities.

(2) Noncurrent deferred revenue is recorded within other long-term liabilities.

Deferred revenue - noncurrent consists primarily of maintenance, extended warranty and other service contracts. We expect to recognize revenue of $29.2, $12.3 and $8.5 in the next 13 to 24 months, the next 25 to 36 months, and thereafter, respectively.

(5) RESTRUCTURING COSTS

Restructuring costs include expenses associated with the Company's efforts to continually improve operational efficiency and reposition its assets to remain competitive on a worldwide basis. Plant closing and other costs include costs of moving fixed assets, employee training, relocation, and facility costs.

Restructuring costs by business segment were as follows:

															Three Months Ended March 31, 2022						Three Months Ended March 31, 2021
Americas															$	0.5					$	0.7
Asia Pacific															—						0.1
Europe, Middle East & Africa															0.4						1.2
Corporate															(0.1)						—
Total															$	0.8					$	2.0

The change in the liability for the restructuring of operations during the three months ended March 31, 2022 were as follows:

			December 31, 2021						Expense						Paid/Utilized						March 31, 2022
Severance and benefits			$	33.8					$	—					$	(11.7)					$	22.1
Plant closing and other			0.2						0.8						(0.7)						0.3
Total			$	34.0					$	0.8					$	(12.4)					$	22.4

The change in the liability for the restructuring of operations during the three months ended March 31, 2021 were as follows:

			December 31, 2020						Expense						Paid/Utilized						March 31, 2021
Severance and benefits			$	68.9					$	0.2					$	(10.1)					$	59.0
Plant closing and other			0.4						1.8						(1.8)						0.4
Total			$	69.3					$	2.0					$	(11.9)					$	59.4

(6) DEBT

Long-term debt, net, consisted of the following as of March 31, 2022 and December 31, 2021:

			March 31, 2022						December 31, 2021
Term Loan due 2027 at 2.99% and 2.84% at March 31, 2022 and December 31, 2021, respectively.			$	2,156.2					$	2,161.7
Senior Secured Notes due 2028 at 4.125% at both March 31, 2022 and December 31, 2021			850.0						850.0
Unamortized discount and issuance costs			(38.1)						(39.4)
			2,968.1						2,972.3
Less: Current Portion			(21.8)						(21.8)
Total long-term debt, net of current portion			$	2,946.3					$	2,950.5

ABL Revolving Credit Facility

At March 31, 2022, Vertiv Group Corporation (a wholly-owned subsidiary of the Company), as the "Borrower," and certain subsidiaries of the Borrower as co-borrowers (the "Co-Borrowers") had $432.2 of availability under the Asset Based Revolving Credit Facility (the "ABL Revolving Credit Facility") (subject to customary conditions, and subject to separate sublimits for letters of credit, swingline borrowings and borrowings made to certain non-U.S. Co-Borrowers), net of letters of credit outstanding in the aggregate principal amount of $19.1, and taking into account the borrowing base limitations set forth in the ABL Revolving Credit Facility. At March 31, 2022, there was no borrowing balance on the ABL Revolving Credit Facility.

(7) LEASES

The Company leases office space, warehouses, vehicles, and equipment. Leases have remaining lease terms of 1 year to 20 years, some of which have renewal and termination options. Termination options are exercisable at the Company's option. The lease terms used to recognize right-of-use assets and lease liabilities include periods covered by options to extend the lease where the Company is reasonably certain to exercise that option and periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise that option. The majority of our leases are operating leases. Finance leases, which are recorded in "Property, Plant, and Equipment", are immaterial to our condensed consolidated financial statements.

Operating lease expenses are recorded in "Cost of sales" and "Selling, general and administrative expenses" on the Unaudited Condensed Consolidated Statements of Earnings (Loss). Refer to the below table for a summary of these lease expenses:

															Three months ended March 31, 2022						Three months ended March 31, 2021
Operating lease cost															$	14.0					$	13.7
Short-term and variable lease cost															6.8						5.2
Total lease cost															$	20.8					$	18.9

Supplemental cash flow information related to operating leases is as follows:

			Three months ended March 31, 2022						Three months ended March 31, 2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows - Payments on operating leases			$	14.3					$	13.7
Right-of-use assets obtained in exchange for new lease obligations:
Operating leases			$	11.7					$	10.2

Supplemental balance sheet information related to operating leases is as follows:

			Financial statement line item			March 31, 2022						December 31, 2021
Operating lease right-of-use assets			Other assets			$	152.8					$	152.9
Operating lease liabilities			Accrued expenses and other liabilities			$	44.0					$	42.1
Operating lease liabilities			Other long-term liabilities			112.8						113.6
Total lease liabilities						$	156.8					$	155.7

Weighted average remaining lease terms and discount rates for operating leases are as follows:

			March 31, 2022						December 31, 2021
Weighted Average Remaining Lease Term			5.6 years						5.5 years
Weighted Average Discount Rate			5.3		%				5.2		%

Maturities of lease liabilities are as follows:

			March 31, 2022						December 31, 2021
			Operating Leases
2022			$	38.4					$	50.5
2023			44.3						41.5
2024			32.7						30.0
2025			20.6						18.7
2026			11.6						10.3
Thereafter			37.2						32.3
Total Lease Payments			184.8						183.3
Less: Imputed Interest			(28.0)						(27.6)
Present value of lease liabilities			$	156.8					$	155.7

(8) INCOME TAXES

The Company's effective tax rate was 58.3% and 24.0% for the three months ended March 31, 2022 and 2021, respectively. The effective tax rate in the three months ended March 31, 2022 is primarily influenced by the mix of income between our U.S. and non-U.S. operations, net of changes in valuation allowances offset by non-taxable changes in fair value of the warrant liabilities. The effective rate for the comparative three month period is primarily influenced by the mix of income between our U.S. and non-U.S. operations and reflects the negative impact of Global Intangible Low-Taxed Income (or "GILTI"), which is offset by changes in the U.S. valuation allowance.

The Company has provided for U.S. federal income taxes and foreign withholding taxes on all temporary differences attributed to basis differences in foreign subsidiaries that are not considered indefinitely reinvested. As of March 31, 2022, the Company has certain earnings of certain foreign affiliates that continue to be indefinitely reinvested, but it was not practicable to estimate the associated deferred tax liability, due to interaction with other tax laws and regulations in the year of inclusion.

(9) RELATED PARTY TRANSACTIONS

Transactions with Affiliates of Advisors

The Company purchased and sold goods in the ordinary course of business with affiliates of Platinum Equity Advisors, LLC ("Advisors"). For the three months ended March 31, 2022 and 2021 purchases were $34.9 and $14.5, respectively. For the three months ended March 31, 2022 sales were $31.4, and sales with affiliates of Advisors were insignificant for the three months ended March 31, 2021. Accounts payable to affiliates of Advisors were $0.9 and $3.9 as of March 31, 2022 and December 31, 2021, respectively. Accounts receivable from affiliates of Advisors were $24.5 and $42.9 as of March 31, 2022 and December 31, 2021, respectively.

Tax Receivable Agreement

On December 31, 2021, the Company and an affiliate of Advisors (the "Vertiv Stockholder") agreed to amend and supplement the prior Tax Receivable Agreement to replace the Company’s remaining payment obligations under the prior agreement with an obligation to pay $100 million in cash in two equal installments. The first installment payment will be due on or before June 15, 2022, and the second installment payment will be due on or before September 15, 2022. Upon receipt of the second installment payment, the agreement will terminate and the Company will not be required to make any further payments to the Vertiv Stockholder.

For the three months ended March 31, 2021 we recorded $1.8 of accretion expense in "Interest expense, net" in the Unaudited Condensed Consolidated Statement of Earnings (Loss). An unrealized gain (loss) of $4.1 was recorded in "Accumulated other comprehensive income" in the Unaudited Condensed Consolidated Comprehensive Income (Loss), related to the change in fair value of the tax receivable liability for the three months ended March 31, 2021.

(10) OTHER FINANCIAL INFORMATION

			March 31, 2022						December 31, 2021
Reconciliation of cash, cash equivalents, and restricted cash
Cash and cash equivalents			$	288.5					$	439.1
Restricted cash included in other current assets			8.0						8.0
Total cash, cash equivalents, and restricted cash			$	296.5					$	447.1

			March 31, 2022						December 31, 2021
Inventories
Finished products			$	298.5					$	236.5
Raw materials			327.5						274.8
Work in process			148.5						105.0
Total inventories			$	774.5					$	616.3
			March 31, 2022						December 31, 2021
Property, plant and equipment, net
Machinery and equipment			$	384.4					$	373.6
Buildings			302.1						304.8
Land			45.0						42.1
Construction in progress			36.1						34.8
Property, plant and equipment, at cost			767.6						755.3
Less: Accumulated depreciation			(282.3)						(266.0)
Property, plant and equipment, net			$	485.3					$	489.3
			March 31, 2022						December 31, 2021
Accrued expenses and other liabilities
Deferred revenue			$	293.9					$	238.9
Accrued payroll and other employee compensation			110.8						125.8
Restructuring (see Note 5)			22.4						34.0
Operating lease liabilities			44.0						42.1
Product warranty			28.2						30.0
Contract liabilities (see Note 4)			60.3						52.1
Tax Receivable Agreement (see Note 9)			100.0						100.0
Other			312.7						330.5
Total			$	972.3					$	953.4

			2022						2021
Change in product warranty accrual
Beginning balance, January 1			$	30.0					$	36.5
Provision charge to expense			2.5						6.4
Paid/utilized			(4.3)						(6.1)
Ending balance, March 31,			$	28.2					$	36.8

(11) FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

In accordance with ASC 820, the Company uses a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. Observable inputs are from sources independent of the Company. Unobservable inputs reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability developed based upon the best information available in the circumstances. These tiers include the following:

Level 1 — inputs include observable unadjusted quoted prices in active markets for identical assets or liabilities

Level 2 — inputs include other than quoted prices in active markets that are either directly or indirectly observable

Level 3 — inputs include unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions

In determining fair value, the Company uses various valuation techniques and prioritizes the use of observable inputs. The availability of observable inputs varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded and other characteristics particular to the instrument. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants and the valuation does not require significant management judgment. For other financial instruments, pricing inputs are less observable in the marketplace and may require management judgment.

Recurring fair value measurements

A summary of the Company's financial instruments recognized at fair value, and the fair value measurements used, follows:

			Balance Sheet Location			Total						Quoted prices in active markets for identical assets (Level 1)						Other observable inputs (Level 2)						Unobservable inputs (Level 3)
March 31, 2022
Assets:
Interest rate swaps			Other current assets			$	4.4					$	—					$	4.4					$	—
Interest rate swaps			Other noncurrent assets			58.5						—						58.5						—
Total assets						$	62.9					$	—					$	62.9					$	—
Liabilities:
Contingent consideration			Accrued expenses and other liabilities			$	2.2					$	—					$	—					$	2.2
Private warrants			Warrant liabilities			54.7						—						54.7						—
Total liabilities						$	56.9					$	—					$	54.7					$	2.2

			Balance Sheet Location			Total						Quoted prices in active markets for identical assets (Level 1)						Other observable inputs (Level 2)						Unobservable inputs (Level 3)
December 31, 2021
Assets:
Interest rate swaps			Other noncurrent assets			$	16.1					$	—					$	16.1					$	—
Total assets						$	16.1					$	—					$	16.1					$	—
Liabilities:
Interest rate swaps			Accrued expenses and other liabilities			$	7.4					$	—					$	7.4					$	—
Contingent consideration			Accrued expenses and other liabilities			3.7						—						—						3.7
Private warrants			Warrant liabilities			149.6						—						149.6						—
Total liabilities						$	160.7					$	—					$	157.0					$	3.7

Contingent consideration — As of March 31, 2022 in conjunction with the Acquisition, there is $2.2 of contingent earnout related to E&I's projected future results recorded in "Accrued expenses and other liabilities" in the Unaudited Condensed Consolidated Balance Sheets. For the three months ended March 31, 2022 the change in fair value of contingent consideration of $1.5 is included within "Other operating expense (income)" on the Unaudited Condensed Consolidated Statements of Earnings(Loss). Refer to "Note 3 - Acquisition" for more details on the Acquisition.

Interest rate swaps — From time to time the Company may enter into derivative financial instruments designed to hedge the variability in interest expense on floating rate debt. Derivatives are recognized as assets or liabilities in the Unaudited Condensed Consolidated Balance Sheets at their fair value. When the derivative instrument qualifies as a cash flow hedge, changes in the fair value are deferred through other comprehensive income, depending on the nature and effectiveness of the offset.

The Company uses interest rate swaps to manage the interest rate mix of our total debt portfolio and related overall cost of borrowing. At March 31, 2022 interest rate swap agreements designated as cash flow hedges effectively swapped a notional amount of $1,000.0 of LIBOR based floating rate debt for fixed rate debt. Our interest rate swaps mature in March 2027. The Company recognized $2.6 and $2.7 in earnings for the three months ended March 31, 2022 and 2021, respectively. At March 31, 2022, the Company expects that approximately $4.4 of pre-tax net gains on cash flow hedges will be reclassified from accumulated other comprehensive income (loss) into earnings during the next twelve months.

The interest rate swaps are valued using the LIBOR yield curves at the reporting date. Counterparties to these contracts are highly rated financial institutions. The fair values of the Company’s interest rate swaps are adjusted for nonperformance risk and creditworthiness of the counterparty through the Company’s credit valuation adjustment (“CVA”). The CVA is calculated at the counterparty level utilizing the fair value exposure at each payment date and applying a weighted probability of the appropriate survival and marginal default percentages.

Net investment hedge — From time to time the Company designates certain intercompany debt to hedge a portion of its investment in foreign subsidiaries and affiliates. The net impact of realized and unrealized translation adjustments from these hedges were insignificant and are included in "Foreign currency translation" in the Unaudited Condensed Consolidated Statement of Other comprehensive income (loss). As of March 31, 2022, approximately $257.0 of the Company's intercompany debt were designated to hedge investments in certain foreign subsidiaries and affiliates.

Private warrants — the fair value of the Private warrants is considered a Level 2 valuation and is determined using the Black-Sholes-Merton valuation model.

The significant assumptions which the Company used in the model are:

Warrant valuation inputs						March 31, 2022						December 31, 2021
Stock price						$	14.00					$	24.97
Strike price						$	11.50					$	11.50
Remaining life						2.85						3.10
Volatility						41.0		%				34.2		%
Interest rate (1)						2.42		%				0.98		%
Dividend yield (2)						0.07		%				0.04		%

(1) Interest rate determined from a constant maturity treasury yield

(2) March 31, 2022 and December 31, 2021 dividend yield assumes $0.01 per share per annum.

Other fair value measurements

We determine the fair value of debt using Level 2 inputs based on quoted market prices. The following table presents the estimated fair value and carrying value of long-term debt, including the current portion of long-term debt as of March 31, 2022 and December 31, 2021.

			March 31, 2022												December 31, 2021
			Fair Value						Par Value (1)						Fair Value						Par Value (1)
Term Loan due 2027			$	2,102.3					$	2,156.2					$	2,148.2					$	2,161.7
Senior Secured Notes due 2028			773.5						850.0						853.2						850.0

(1)See Note 6 — Debt for additional information

(12) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Activity in accumulated other comprehensive income (loss) is as follows:

															Three months ended March 31, 2022						Three months ended March 31, 2021
Foreign currency translation, beginning															$	39.8					$	104.9
Other comprehensive income (loss)															(36.3)						36.1
Foreign currency translation, ending															3.5						68.8
Interest rate swaps, beginning															8.7						(32.8)
Unrealized gain (loss) deferred during the period (1)															54.2						33.9
Interest rate swaps, ending															62.9						1.1
Pension, beginning															(12.9)						(19.7)
Actuarial gain (losses) recognized during the period, net of income taxes															0.1						(0.8)
Pension, ending															(12.8)						(20.5)
Tax receivable agreement, beginning															—						(0.9)
Unrealized gain (loss) during the period (2)															—						4.1
Tax receivable agreement, ending															—						3.2
Accumulated other comprehensive income (loss)															$	53.6					$	52.6

(1)During the three months ended March 31, 2022 and 2021, $2.6 and $2.7, respectively, was reclassified into earnings.

(2)The fair value movement on the Tax Receivable Agreement attributable to our own credit risk spread was recorded in "Other comprehensive income (loss)" prior to the amended Tax Receivable Agreement.

(13) SEGMENT INFORMATION

The primary income measure used for assessing segment performance and making operating decisions is operating profit (loss). Segment performance is assessed exclusive of Corporate and other costs, foreign currency gain (loss), and amortization of intangibles. Corporate and other costs primarily include headquarters management costs, stock-based compensation, other incentive compensation, global IT costs, change in warrant liabilities, asset impairments, and costs that support global product platform development and offering management.

Vertiv determines its reportable segments based on how operations are managed internally for the products and services sold to customers, including how the results are reviewed by the chief operating decision maker (CODM), which includes determining resource allocation methodologies used for reportable segments.

Summarized information about the Company’s results of operations by reportable segment and product and service offering follows:

Americas includes products and services sold for applications within the data center, communication networks and commercial/industrial markets in North America and Latin America. This segment’s principal product and service offerings include:

• Critical infrastructure & solutions includes AC and DC power management, thermal management, and modular hyperscale type data center sites.

• Integrated rack solutions** includes racks, rack power, rack power distribution, rack thermal systems, and configurable integrated solutions; and hardware for managing I.T. equipment.

• Services & spares** includes preventative maintenance, acceptance testing, engineering and consulting, performance assessments, remote monitoring, training, spare parts, and digital critical infrastructure software.

Asia Pacific includes products and services sold for applications within the data center, communication networks and commercial/industrial markets throughout Greater China and Australia & New Zealand, South East Asia and India. Products and services offered are similar to the Americas segment.

Europe, Middle East & Africa includes products and services sold for applications within the data center, communication networks and commercial/industrial markets in Europe, Middle East & Africa. Products and services offered are similar to the Americas segment.

Reportable Segments

Sales															Three months ended March 31, 2022						Three months ended March 31, 2021
Americas															$	549.0					$	505.9
Asia Pacific															353.8						377.6
Europe, Middle East & Africa															318.0						250.4
															1,220.8						1,133.9
Eliminations															(64.4)						(35.5)
Total															$	1,156.4					$	1,098.4

Intersegment sales (1)															Three months ended March 31, 2022						Three months ended March 31, 2021
Americas															$	13.9					$	4.4
Asia Pacific															21.0						20.2
Europe, Middle East & Africa															29.5						10.9
Total															$	64.4					$	35.5

(1)Intersegment selling prices approximate market prices.

Operating profit (loss)															Three months ended March 31, 2022						Three months ended March 31, 2021
Americas															$	57.9					$	126.4
Asia Pacific															41.5						53.1
Europe, Middle East & Africa															33.2						33.4
Total reportable segments															132.6						212.9
Foreign currency gain (loss)															1.3						6.9
Corporate and other															(121.4)						(108.2)
Total corporate, other and eliminations															(120.1)						(101.3)
Amortization of intangibles															(57.7)						(31.8)
Operating profit (loss)															$	(45.2)					$	79.8

(14) EARNINGS (LOSS) PER SHARE

Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share is computed by dividing net income (loss) adjusted for the gain on fair value of warrant liability, if the impact is dilutive, by the weighted average number of common shares outstanding during the period increased by the number of additional shares that would have been outstanding related to potentially dilutive equity-based compensation and warrants.

The details of the earnings per share calculations for the three months ended March 31, 2022 and 2021 are as follows:

(In millions, except share and per share amounts)															Three months ended March 31, 2022						Three months ended March 31, 2021
Basic earnings (loss) per share computation:
Net income (loss)															$	8.5					$	31.7
Weighted-average number of shares outstanding - basic															375,972,294						349,603,701
Basis earnings per share															$	0.02					$	0.09
Diluted earnings (loss) per share computation:
Net income (loss)															$	8.5					$	31.7
Gain on fair value of warrant liabilities															(94.9)						—
Net income (loss) adjusted for the gain on fair value of warrant liabilities															$	(86.4)					$	31.7
Weighted-average number of shares outstanding - basic															375,972,294						349,603,701
Dilutive effect of private warrants															3,720,435						—
Dilutive effect of equity-based compensation															—						3,844,884
Weighted-average number of shares outstanding - diluted															379,692,729						353,448,585
Diluted earnings (loss) per share															$	(0.23)					$	0.09

The dilutive effect of private warrants was 3.7 million during the three months ended March 31, 2022. Additional equity-based compensation awards were also outstanding during the three months ended March 31, 2022, but were not included in the computation of diluted earnings (loss) per share because the effect would be anti-dilutive. Such anti-dilutive equity-based compensation awards represented 7.8 million shares for the three months ended March 31, 2022.

The dilutive effect of equity-based compensation awards was 3.8 million during the three months ended March 31, 2021. Additional equity-based compensation awards and warrants were also outstanding during the three months ended March 31, 2021, but were not included in the computation of diluted earnings per common share because the effect would be anti-dilutive. Such anti-dilutive equity-based compensation awards and warrants represented 0.8 million and 5.3 million shares for the three months ended March 31, 2021, respectively.

(15) COMMITMENTS AND CONTINGENCIES

The Company is a party to a number of pending legal proceedings and claims, including those involving general and product liability and other matters. The Company accrues for such liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated. Accruals are based on developments to date; management’s estimates of the outcomes of these matters; the Company’s experience in contesting, litigating and settling similar matters; and any related insurance coverage. While the Company believes that a material adverse impact is unlikely, given the inherent uncertainty of litigation, a future development in these matters could have a material adverse impact on the Company. The Company is unable to estimate any additional loss or range of loss that may result from the ultimate resolution of these matters, other than those described below.

On December 28, 2017, Vertiv acquired Energy Labs, Inc. (“Energy Labs”). The purchase agreement contained a provision for contingent consideration in the form of an earn-out payment based on the achievement of 2018 operating results. The range of outcomes was zero to $34.5. On June 4, 2019, Vertiv notified the selling shareholders of Energy Labs of Vertiv’s determination that the applicable 2018 operating results had not been achieved and that no contingent consideration was due to the selling shareholders. On September 6, 2019, the selling shareholders of Energy Labs notified Vertiv of their dispute regarding the contingent consideration due to them. The selling shareholders assert that the applicable 2018 operating results were exceeded and that Vertiv owes $34.5 in earn-out, the highest amount of earn-out possible under the agreement. On December 21, 2021, the parties agreed to a settlement term sheet, which includes, among other terms, the following: the Company agrees to pay $21.5 to the selling shareholders of Energy Labs; a full and complete waiver, release and discharge of all claims and liabilities; and a dismissal of the pending lawsuit. The parties executed a Settlement Agreement on December 30, 2021 consistent with the aforementioned terms. On January 12, 2022, the Company paid the agreed upon settlement of $21.5.

On August 3, 2021, an American Arbitration Association arbitration hearing commenced with respect to a 2018 claim filed by Vertiv against SVO Building One, LLC (“SVO”) alleging damages of approximately $12.0 with respect to (i) unremitted payment for work and materials in connection with, the design, engineering, procurement, installation, construction, and commissioning of a data center located in Sacramento, California and (ii) damages and injunctive relief relating to SVO’s unauthorized use of Vertiv’s intellectual property and work product. SVO filed a counterclaim in 2018 alleging damages of approximately $18.0 relating to (i) allegations that Vertiv was not a duly licensed contractor at all times during the project in violation of California’s contractor license regulations, (ii) breach of warranty, and (iii) gross negligence. On September 3, 2021, the arbitrator issued an interim phase one ruling finding (1) that Vertiv was in violation of California contractor license regulations and was barred from recovery of approximately $9.0 for work performed and equipment delivered in connection with the project, as well as requiring disgorgement plus interest of $10.0, (2) SVO was not in violation of California’s contractor license regulations, and (3) Vertiv and SVO agreed to a traditional baseball arbitration provision under the terms and conditions for the project, wherein each party is required to submit a proposed final award to the arbitrator for consideration, and the arbitrator is required to select one of the proposed awards submitted by the parties as the final award in the arbitration and is prohibited from issuing an alternative award. On December 31, 2021, the parties entered into a settlement agreement on ordinary and customary terms, settling all of the disputes between them.

On March 24, 2022, a putative securities class action, Kirk Vinings v. Vertiv Holdings Co, 22-cv-02416, was filed against Vertiv, Rob Johnson, and David Fallon, in the Southern District of New York. The plaintiff asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and SEC Rule 10b-5 on behalf of a putative class of all persons and entities that purchased or otherwise acquired Vertiv securities between April 28, 2021 and February 23, 2022. The complaint alleges that Vertiv failed to disclose in certain of its filings made with the SEC during 2021 that it was not able to sufficiently anticipate and respond to supply chain issues and inflation. While Vertiv believes it has meritorious defenses against the plaintiff’s claims, Vertiv is unable at this time to predict the outcome of this dispute or the amount of any cost associated with its resolution.

At March 31, 2022, there were no known contingent liabilities (including guarantees, taxes and other claims) that management believes will be material in relation to the Company’s consolidated financial statements, nor were there any material commitments outside the normal course of business other than those described above.