Item 1. Financial Statements

WATERS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(unaudited)

		June 28, 2025				December 31, 2024
		(In thousands, except per share data)
ASSETS
Current assets:
Cash and cash equivalents		$	367,215			$	325,355
Accounts receivable, net			730,074				733,365
Inventories			540,754				477,261
Other current assets			144,079				133,130
Total current assets			1,782,122				1,669,111
Property, plant and equipment, net			645,267				651,200
Intangible assets, net			579,127				567,906
Goodwill			1,337,908				1,295,720
Operating lease assets			79,334				74,193
Other assets			294,317				295,665
Total assets		$	4,718,075			$	4,553,795
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Notes payable		$	260,000			$	—
Accounts payable			97,911				99,931
Accrued employee compensation			55,436				93,969
Deferred revenue and customer advances			333,850				250,807
Current operating lease liabilities			28,746				25,537
Accrued income taxes			32,063				158,658
Accrued warranty			11,927				11,602
Other current liabilities			196,196				149,254
Total current liabilities			1,016,129				789,758
Long-term liabilities:
Long-term debt			1,196,966				1,626,488
Long-term portion of retirement benefits			45,914				44,611
Long-term income tax liabilities			26,842				30,318
Long-term operating lease liabilities			52,656				50,317
Other long-term liabilities			219,756				183,796
Total long-term liabilities			1,542,134				1,935,530
Total liabilities			2,558,263				2,725,288
Commitments and contingencies (Notes 6, 7 and 9)
Stockholders’ equity:
Preferred stock, par value $0.01 per share, 5,000 shares authorized, none issued at June 28, 2025 and December 31, 2024			—				—
Common stock, par value $0.01 per share, 400,000 shares authorized, 163,126 and 162,962 shares issued, 59,514 and 59,388 shares outstanding at June 28, 2025 and December 31, 2024, respectively			1,631				1,630
Additional paid-in capital			2,379,907				2,341,298
Retained earnings			10,057,147				9,788,655
Treasury stock, at cost, 103,612 and 103,574 shares at June 28, 2025 and December 31, 2024, respectively			(10,162,102	)			(10,147,793	)
Accumulated other comprehensive loss			(116,771	)			(155,283	)
Total stockholders’ equity			2,159,812				1,828,507
Total liabilities and stockholders’ equity		$	4,718,075			$	4,553,795

The accompanying notes are an integral part of the interim consolidated financial statements.

WATERS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

		Three Months Ended
		June 28, 2025				June 29, 2024
		(In thousands, except per share data)
Revenues:
Product sales		$	473,400			$	435,144
Service sales			297,932				273,385
Total net sales			771,332				708,529
Costs and operating expenses:
Cost of product sales			200,493				175,836
Cost of service sales			120,914				112,408
Selling and administrative expenses			201,257				173,247
Research and development expenses			48,548				46,182
Purchased intangibles amortization			11,907				11,744
Total costs and operating expenses			583,119				519,417
Operating income			188,213				189,112
Other expense, net			(676	)			(302	)
Interest expense			(14,354	)			(23,726	)
Interest income			4,507				4,328
Income before income taxes			177,690				169,412
Provision for income taxes			30,579				26,675
Net income		$	147,111			$	142,737
Net income per basic common share		$	2.47			$	2.41
Weighted-average number of basic common shares			59,515				59,339
Net income per diluted common share		$	2.47			$	2.40
Weighted-average number of diluted common shares and equivalents			59,656				59,451

The accompanying notes are an integral part of the interim consolidated financial statements.

Table of Contents

WATERS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

		Six Months Ended
		June 28, 2025				June 29, 2024
		(In thousands, except per share data)
Revenues:
Product sales		$	873,930			$	811,295
Service sales			559,107				534,073
Total net sales			1,433,037				1,345,368
Costs and operating expenses:
Cost of product sales			369,052				329,018
Cost of service sales			229,100				221,012
Selling and administrative expenses			376,138				347,783
Research and development expenses			95,170				90,777
Purchased intangibles amortization			23,619				23,578
Litigation provision			—				10,242
Total costs and operating expenses			1,093,079				1,022,410
Operating income			339,958				322,958
Other income, net			848				1,957
Interest expense			(28,624	)			(49,246	)
Interest income			8,396				8,599
Income before income taxes			320,578				284,268
Provision for income taxes			52,086				39,335
Net income		$	268,492			$	244,933
Net income per basic common share		$	4.51			$	4.13
Weighted-average number of basic common shares			59,478				59,287
Net income per diluted common share		$	4.50			$	4.12
Weighted-average number of diluted common shares and equivalents			59,686				59,445

The accompanying notes are an integral part of the interim consolidated financial statements.

WATERS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited)

		Three Months Ended								Six Months Ended
		June 28, 2025				June 29, 2024				June 28, 2025				June 29, 2024
		(In thousands)								(In thousands)
Net income		$	147,111			$	142,737			$	268,492			$	244,933
Other comprehensive income (loss):
Foreign currency translation			33,716				(6,675	)			40,268				(16,215	)
Unrealized (losses) gains on derivative instruments before reclassifications			(497	)			829				(1,821	)			3,234
Amounts reclassified to interest income			(136	)			(277	)			(311	)			(574	)
Unrealized (losses) gains on derivative instruments before income taxes			(633	)			552				(2,132	)			2,660
Income tax benefit (expense)			152				(132	)			512				(638	)
Unrealized (losses) gains on derivative instruments, net of tax			(481	)			420				(1,620	)			2,022
Retirement liability adjustment before reclassifications			(80	)			(181	)			(51	)			151
Amounts reclassified to other income, net			—				59				—				(58	)
Retirement liability adjustment before income taxes			(80	)			(122	)			(51	)			93
Income tax (expense) benefit			(74	)			58				(85	)			18
Retirement liability adjustment, net of tax			(154	)			(64	)			(136	)			111
Other comprehensive income (loss)			33,081				(6,319	)			38,512				(14,082	)
Comprehensive income		$	180,192			$	136,418			$	307,004			$	230,851

The accompanying notes are an integral part of the interim consolidated financial statements.

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WATERS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

		Six Months Ended
		June 28, 2025				June 29, 2024
		(In thousands)
Cash flows from operating activities:
Net income		$	268,492			$	244,933
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation			25,975				22,346
Deferred income taxes			1,876				3,958
Depreciation			43,930				44,375
Amortization of intangibles			57,088				51,368
Change in operating assets and liabilities:
Decrease in accounts receivable			42,870				69,642
Increase in inventories			(35,671	)			(16,709	)
Increase in other current assets			(12,364	)			(12,549	)
Decrease in other assets			14,045				6,802
Decrease in accounts payable and other current liabilities			(164,092	)			(31,206	)
Increase in deferred revenue and customer advances			64,429				69,352
Decrease in other liabilities			(5,884	)			(134,908	)
Net cash provided by operating activities			300,694				317,404
Cash flows from investing activities:
Additions to property, plant, equipment and software capitalization			(48,336	)			(64,759	)
Business acquisitions, net of cash acquired			(34,969	)			—
Investments in unaffiliated companies, net			(1,295	)			(1,064	)
Purchases of investments			—				(1,855	)
Maturities and sales of investments			—				1,819
Net cash used in investing activities			(84,600	)			(65,859	)
Cash flows from financing activities:
Proceeds from debt issuances			70,000				170,000
Payments on debt			(240,000	)			(520,000	)
Payments of debt issuance costs			(4,506	)			—
Proceeds from stock plans			12,738				21,836
Purchases of treasury shares			(14,309	)			(13,334	)
Proceeds from derivative contracts			1,802				15,285
Net cash used in financing activities			(174,275	)			(326,213	)
Effect of exchange rate changes on cash and cash equivalents			41				6,019
Increase (decrease) in cash and cash equivalents			41,860				(68,649	)
Cash and cash equivalents at beginning of period			325,355				395,076
Cash and cash equivalents at end of period		$	367,215			$	326,427

The accompanying notes are an integral part of the interim consolidated financial statements.

WATERS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(unaudited, in thousands)

		Number of Common Shares				Common Stock				Additional Paid-In Capital				Retained Earnings				Treasury Stock				Accumulated Other Comprehensive Loss				Total Stockholders’ Equity
Balance March 30, 2024			162,882			$	1,629			$	2,291,103			$	9,253,017			$	(10,147,341	)		$	(141,883	)		$	1,256,525
Net income			—				—				—				142,737				—				—				142,737
Other comprehensive loss			—				—				—				—				—				(6,319	)			(6,319	)
Issuance of common stock for employees:
Employee Stock Purchase Plan			10				—				2,794				—				—				—				2,794
Stock options exercised			32				—				5,060				—				—				—				5,060
Treasury stock			—				—				—				—				(245	)			—				(245	)
Stock-based compensation			2				—				11,415				—				—				—				11,415
Balance June 29, 2024			162,926			$	1,629			$	2,310,372			$	9,395,754			$	(10,147,586	)		$	(148,202	)		$	1,411,967

		Number of Common Shares				Common Stock				Additional Paid-In Capital				Retained Earnings				Treasury Stock				Accumulated Other Comprehensive Loss				Total Stockholders’ Equity
Balance March 29, 2025			163,109			$	1,631			$	2,362,309			$	9,910,036			$	(10,161,727	)		$	(149,852	)		$	1,962,397
Net income			—				—				—				147,111				—				—				147,111
Other comprehensive income			—				—				—				—				—				33,081				33,081
Issuance of common stock for employees:
Employee Stock Purchase Plan			10				—				3,287				—				—				—				3,287
Stock options exercised			4				—				1,205				—				—				—				1,205
Treasury stock			—				—				—				—				(375	)			—				(375	)
Stock-based compensation			3				—				13,106				—				—				—				13,106
Balance June 28, 2025			163,126			$	1,631			$	2,379,907			$	10,057,147			$	(10,162,102	)		$	(116,771	)		$	2,159,812

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

WATERS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(unaudited, in thousands)

		Number of Common Shares				Common Stock				Additional Paid-In Capital				Retained Earnings				Treasury Stock				Accumulated Other Comprehensive Loss				Total Stockholders’ Equity
Balance December 31, 2023			162,709			$	1,627			$	2,266,265			$	9,150,821			$	(10,134,252	)		$	(134,120	)		$	1,150,341
Net income			—				—				—				244,933				—				—				244,933
Other comprehensive loss			—				—				—				—				—				(14,082	)			(14,082	)
Issuance of common stock for employees:
Employee Stock Purchase Plan			18				—				4,790				—				—				—				4,790
Stock options exercised			83				1				17,611				—				—				—				17,612
Treasury stock			—				—				—				—				(13,334	)			—				(13,334	)
Stock-based compensation			116				1				21,706				—				—				—				21,707
Balance June 29, 2024			162,926			$	1,629			$	2,310,372			$	9,395,754			$	(10,147,586	)		$	(148,202	)		$	1,411,967

		Number of Common Shares				Common Stock				Additional Paid-In Capital				Retained Earnings				Treasury Stock				Accumulated Other Comprehensive Loss				Total Stockholders’ Equity
Balance December 31, 2024			162,962			$	1,630			$	2,341,298			$	9,788,655			$	(10,147,793	)		$	(155,283	)		$	1,828,507
Net income			—				—				—				268,492				—				—				268,492
Other comprehensive income			—				—				—				—				—				38,512				38,512
Issuance of common stock for employees:
Employee Stock Purchase Plan			17				—				5,592				—				—				—				5,592
Stock options exercised			37				—				7,805				—				—				—				7,805
Treasury stock			—				—				—				—				(14,309	)			—				(14,309	)
Stock-based compensation			110				1				25,212				—				—				—				25,213
Balance June 28, 2025			163,126			$	1,631			$	2,379,907			$	10,057,147			$	(10,162,102	)		$	(116,771	)		$	2,159,812

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

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CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1 Basis of Presentation and Summary of Significant Accounting Policies

Waters Corporation (the “Company,” “we,” “our,” or “us”), a global leader in analytical instruments and software, has pioneered innovations in chromatography, mass spectrometry and thermal analysis serving life, materials and food sciences for more than 65 years. The Company primarily designs, manufactures, sells and services high-performance liquid chromatography (“HPLC”), ultra-performance liquid chromatography (“UPLC” and together with HPLC, referred to as “LC”) and mass spectrometry (“MS”) technology systems and support products, including chromatography columns, other consumable products and comprehensive post-warranty service plans. These systems are complementary products that are frequently employed together

(“LC-MS”)

and sold as integrated instrument systems using common software platforms. LC is a standard technique and is utilized in a broad range of industries to detect, identify, monitor and measure the chemical, physical and biological composition of materials, and to purify a full range of compounds. MS technology, principally in conjunction with chromatography, is employed in drug discovery and development, including clinical trial testing, the analysis of proteins in disease processes (known as “proteomics”), nutritional safety analysis and environmental testing.

LC-MS

instruments combine a liquid phase sample introduction and separation system with mass spectrometric compound identification and quantification. In addition, the Company designs, manufactures, sells and services thermal analysis, rheometry and calorimetry instruments through its TA Instruments product line. These instruments are used in predicting the suitability and stability of fine chemicals, pharmaceuticals, water, polymers, metals and viscous liquids for various industrial, consumer goods and healthcare products, as well as for life science research. The Company is also a developer and supplier of advanced software-based products that interface with the Company’s instruments, as well as other manufacturers’ instruments.

On July 13, 2025, the Company entered into a definitive agreement to purchase and combine Becton, Dickinson and Company Biosciences & Diagnostic Solutions business with Waters Corporation for a combined stock and cash purchase price valued at approximately

$17.5 billion. Refer to Note 14 “Subsequent Events” for further details.

The Company’s interim fiscal quarter typically ends on the thirteenth Saturday of each quarter. Since the Company’s fiscal year end is December 31, the first and fourth fiscal quarters may have more or less than thirteen complete weeks. The Company’s second fiscal quarters for 2025 and 2024 ended on June 28, 2025 and June 29, 2024, respectively.

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with the instructions in Form

10-Q

and do not include all of the information and footnote disclosures required for annual financial statements prepared in accordance with generally accepted accounting principles (“U.S. GAAP”) in the United States of America. The consolidated financial statements include the accounts of the

Company

and its subsidiaries, all of which are wholly owned. All intercompany balances and transactions have been eliminated.

The preparation of consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent liabilities at the dates of the financial statements. Actual amounts may differ from these estimates under different assumptions or conditions.

It is management’s opinion that the accompanying interim consolidated financial statements reflect all adjustments (which are normal and recurring) that are necessary for a fair statement of the results for the interim periods. The interim consolidated financial statements should be read in conjunction with the consolidated financial statements included in the Company’s Annual Report on Form

10-K

for the year ended December 31, 2024, as filed with the U.S. Securities and Exchange Commission (“SEC”) on February 25, 2025.

Risks and Uncertainties

The Company is subject to risks common to companies in the analytical instrument industry, including, but not limited to, global economic and financial market conditions, fluctuations in foreign currency exchange rates, fluctuations in customer demand, development by its competitors of new technological innovations, costs of developing new technologies, levels of debt and debt service requirements, risk of disruption, dependence on key personnel, protection and litigation of proprietary technology, shifts in taxable income between tax jurisdictions and compliance with new tariff rules and regulations of the U.S. Food and Drug Administration and similar foreign regulatory authorities and agencies.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

Translation of Foreign Currencies

The functional currency of each of the Company’s foreign operating subsidiaries is the local currency of its country of domicile, except for the Company’s subsidiaries in Hong Kong and Singapore, where the underlying transactional cash flows are denominated in currencies other than the respective local currency of domicile. The functional currency of the Hong Kong and Singapore subsidiaries is the U.S. dollar, based on the respective entity’s cash flows.

For the Company’s foreign operations, assets and liabilities are translated into U.S. dollars at exchange rates prevailing on the balance sheet date, while revenues and expenses are translated at average exchange rates prevailing during the respective period. Any resulting translation gains or losses are included in accumulated other comprehensive loss in the consolidated balance sheets.

Cash and Cash Equivalents

Cash equivalents represent highly liquid investments, with original maturities of 90 days or less, while investments with longer maturities are classified as investments. The Company maintains cash balances in various operating accounts in excess of federally insured limits, and in foreign subsidiary accounts in currencies other than the U.S. dollar. As of June 28, 2025 and December 31, 2024, $320 million out of $367 million and $275 million out of $325 million, respectively, of the Company’s total cash and cash equivalents were held by foreign subsidiaries. In addition, $267 million out of $367 million and $226 million out of $325 million of cash and cash equivalents were held in currencies other than the U.S. dollar at June 28, 2025 and December 31, 2024, respectively.

Accounts Receivable and Allowance for Credit Losses

Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The Company has very limited use of rebates and other cash considerations payable to customers and, as a result, the transaction price determination does not have any material variable consideration. The Company does not consider there to be significant concentrations of credit risk with respect to trade receivables due to the short-term nature of the balances, the Company having a large and diverse customer base, and the Company having a strong historical experience of collecting receivables with minimal defaults. As a result, credit risk is considered low across territories and trade receivables are considered to be a single class of financial asset. The allowance for credit losses is based on a number of factors and is calculated by applying a historical loss rate to trade receivable aging balances to estimate a general reserve balance along with an additional adjustment for any specific receivables with known or anticipated issues affecting the likelihood of recovery. Past due balances with a probability of default based on historical data as well as relevant available forward-looking information are included in the specific adjustment. The historical loss rate is reviewed on at least an annual basis and the allowance for credit losses is reviewed quarterly for any required adjustments. The Company does not have any

off-balance

sheet credit exposure related to its customers.

Trade receivables related to instrument sales are collateralized by the instrument that is sold. If there is a risk of default related to a receivable that is collateralized, then the fair value of the collateral is calculated and adjusted for the cost to

re-possess,

refurbish and

re-sell

the instrument. This adjusted fair value is compared to the receivable balance and the difference would be recorded as the expected credit loss.

The following is a summary of the activity of the Company’s allowance for credit losses for the six months ended June 28, 2025 and June 29, 2024 (in thousands):

		Balance at Beginning of Period				Additions				Deductions and Other				Balance at End of Period
Allowance for Credit Losses
June 28, 2025		$	14,269			$	4,032			$	(4,820	)		$	13,481
June 29, 2024		$	19,335			$	1,691			$	(6,882	)		$	14,144

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CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

Fair Value Measurements

In accordance with the accounting standards for fair value measurements and disclosures, certain of the Company’s assets and liabilities are measured at fair value on a recurring basis as of June 28, 2025 and December 31, 2024. Fair values determined by Level 1 inputs utilize observable data, such as quoted prices in active markets. Fair values determined by Level 2 inputs utilize data points other than quoted prices in active markets that are observable either directly or indirectly. Fair values determined by Level 3 inputs utilize unobservable data points for which there is little or no market data, which require the reporting entity to develop its own assumptions.

The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis at June 28, 2025 (in thousands):

		Total at June 28, 2025				Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
Assets:
Waters 401(k) Restoration Plan assets		$	30,036			$	30,036			$	—			$	—
Foreign currency exchange contracts			656				—				656				—
Interest rate cross-currency swap agreements			216				—				216				—
Interest rate swap cash flow hedge			189				—				189				—
Total		$	31,097			$	30,036			$	1,061			$	—
Liabilities:
Foreign currency exchange contracts		$	130			$	—			$	130			$	—
Interest rate cross-currency swap agreements			54,404				—				54,404				—
Interest rate swap cash flow hedge			2,458				—				2,458				—
Total		$	56,992			$	—			$	56,992			$	—

The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis at December 31, 2024 (in thousands):

		Total at December 31, 2024				Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
Assets:
Waters 401(k) Restoration Plan assets		$	30,137			$	30,137			$	—			$	—
Foreign currency exchange contracts			482				—				482				—
Interest rate cross-currency swap agreements			26,196				—				26,196				—
Interest rate swap cash flow hedge			503				—				503				—
Total		$	57,318			$	30,137			$	27,181			$	—
Liabilities:
Foreign currency exchange contracts		$	261			$	—			$	261			$	—
Interest rate swap cash flow hedge			641				—				641				—
Total		$	902			$	—			$	902			$	—

Fair Value of 401(k) Restoration Plan Assets

The 401(k) Restoration Plan is a nonqualified defined contribution plan and the assets were held in registered mutual funds and have been classified as Level 1. The fair values of the assets in the plan are determined through market and observable sources from daily quoted prices on nationally recognized securities exchanges.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

Fair Value of Cash Equivalents, Foreign Currency Exchange Contracts, Interest Rate Cross-Currency Swap Agreements and Interest Rate Swap Cash Flow Hedges

The fair values of the Company’s cash equivalents, foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap cash flow hedges are determined through market and observable sources and have been classified as Level 2. These assets and liabilities have been initially valued at the transaction price and subsequently valued, typically utilizing third-party pricing services. The pricing services use many inputs to determine value, including reportable trades, benchmark yields, credit spreads, broker/dealer quotes, current spot rates and other industry and economic events. The Company validates the prices provided by third-party pricing services by reviewing their pricing methods and obtaining market values from other pricing sources.

Fair Value of Other Financial Instruments

The Company’s accounts receivable and accounts payable are recorded at cost, which approximates fair value due to their short-term nature. The carrying value of the Company’s variable interest rate debt approximates fair value due to the variable nature of the interest rate. The carrying value of the Company’s fixed interest rate debt was $1.3 billion at both June 28, 2025 and December 31, 2024. The fair value of the Company’s fixed interest rate debt was estimated using discounted cash flow models, based on estimated current rates offered for similar debt under current market conditions for the Company. The fair value of the Company’s fixed interest rate debt was estimated to be $1.1 billion at both June 28, 2025 and December 31, 2024, using Level 2 inputs.

Derivative Transactions

The Company is a global company that operates in over 35 countries and, as a result, the Company’s net sales, cost of sales, operating expenses and balance sheet amounts are significantly impacted by fluctuations in foreign currency exchange rates. The Company is exposed to currency price risk on foreign currency exchange rate fluctuations when it translates its

non-U.S.

dollar foreign subsidiaries’ financial statements into U.S. dollars and when any of the Company’s subsidiaries purchase or sell products or services in a currency other than its own currency.

The Company’s principal strategies in managing exposures to changes in foreign currency exchange rates are to (1) naturally hedge the foreign-currency-denominated liabilities on the Company’s balance sheet against corresponding assets of the same currency, such that any changes in liabilities due to fluctuations in foreign currency exchange rates are typically offset by corresponding changes in assets and (2) mitigate foreign exchange risk exposure of international operations by hedging the variability in the movement of foreign currency exchange rates on a portion of its euro-denominated and

yen-denominated

net asset investments. The Company presents the derivative transactions in financing activities in the statement of cash flows.

Foreign Currency Exchange Contracts

The Company does not specifically enter into any derivatives that hedge foreign-currency-denominated operating assets, liabilities or commitments on its balance sheet, other than a portion of certain third-party accounts receivable and accounts payable, and the Company’s net worldwide intercompany receivables and payables, which are eliminated in consolidation. The Company periodically aggregates its net worldwide balances by currency and then enters into foreign currency exchange contracts that mature within 90 days to hedge a portion of the remaining balance to minimize some of the Company’s currency price risk exposure. The foreign currency exchange contracts are not designated for hedge accounting treatment. Principal hedged currencies include the euro, Japanese yen, British pound, Mexican peso and Brazilian real.

Cash Flow Hedges

The Company’s Credit Facility is a variable borrowing and has interest payments based on a contractually specified interest rate index. The contractually specified index on the Credit Facility is the 1-month,

3-month

or 6-month Term SOFR. The variable rate interest payments create interest risk for the Company as interest payments will fluctuate based on changes in the contractually specified interest rate index over the life of the Credit Facility. In order to reduce interest rate risk, the Company has entered into interest rate swaps with an aggregate notional value of $150 million to effectively

lock-in

the forecasted interest payments on the variable rate borrowing over its term. The interest rate swaps represent cash flow hedges and are assessed for hedge effectiveness each reporting period. When the hedge relationship is highly

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

effective at achieving offsetting changes in cash flows, the Company will record the entire change in fair value of the interest rate swaps in accumulated other comprehensive loss. The amount in accumulated other comprehensive loss is reclassified to income in the period that the underlying transaction impacts consolidated income. If it becomes probable that the forecasted transaction will not occur, the hedge relationship will be

de-designated

and amounts accumulated in other comprehensive loss will be reclassified to income in the current period. Interest settlements due to benchmark interest rate changes are recorded in interest income or interest expense. For the six months ended June 28, 2025, the Company did not have any cash flow hedges that were deemed ineffective.

Interest Rate Cross-Currency Swap Agreements

As of June 28, 2025, the Company had entered into interest rate cross-currency swap derivative agreements with durations up to three years with an aggregate notional value of $705 million to hedge the variability in the movement of foreign currency exchange rates on a portion of its euro-denominated and

yen-denominated

net asset investments. Under hedge accounting, the change in fair value of the derivative that relates to changes in the foreign currency spot rate are recorded in the currency translation adjustment in other comprehensive income and remain in accumulated other comprehensive loss in stockholders’ equity until the sale or substantial liquidation of the foreign operation. The difference between the interest rate received and paid under the interest rate cross-currency swap derivative agreement is recorded in interest income in the statement of operations.

The Company’s foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap agreements designated as cash flow hedges included in the c

onso

lidated balance sheets are classified as follows (in thousands):

		June 28, 2025								December 31, 2024
		Notional Value				Fair Value				Notional Value				Fair Value
Foreign currency exchange contracts:
Other current assets		$	65,483			$	656			$	14,999			$	482
Other current liabilities		$	23,000			$	130			$	24,749			$	261
Interest rate cross-currency swap agreements:
Other assets		$	25,000			$	216			$	625,000			$	26,196
Other liabilities		$	680,000			$	54,404			$	—			$	—
Accumulated other comprehensive (loss) income						$	(50,409	)						$	32,979
Interest rate swap cash flow hedges:
Other assets		$	50,000			$	189			$	100,000			$	503
Other liabilities		$	100,000			$	2,458			$	50,000			$	641
Accumulated other comprehensive (loss) income						$	(2,269	)						$	(138	)

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

The following is a summary of the activity included in the consolidated statements of operations and statements of comprehensive income related to the foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap agreements designated as cash flow hedges (in thousands):

		Financial		Three Months Ended								Six Months Ended
		Statement		June 28, 2025				June 29, 2024				June 28, 2025				June 29, 2024
		Classification
Foreign currency exchange contracts:
Realized (losses) gains on closed contracts		Cost of sales		$	(783	)		$	794			$	(1,398	)		$	1,051
Unrealized gains on open contracts		Cost of sales			798				117				304				66
Cumulative net pre-tax gains (losses)		Cost of sales		$	15			$	911			$	(1,094	)		$	1,117
Interest rate cross-currency swap agreements:
Interest earned		Interest income		$	2,698			$	2,590			$	5,069			$	5,127
Unrealized (losses) gains on open contracts		Other comprehensive income		$	(56,201	)		$	6,647			$	(83,388	)		$	21,564
Interest rate swap cash flow hedges:
Interest earned		Interest income		$	136			$	278			$	311			$	574
Unrealized (losses) gains on open contracts		Other comprehensive income		$	(632	)		$	551			$	(2,131	)		$	2,660

Stockholders’ Equity

In December 2024, the Company’s Board of Directors authorized the extension of its existing share repurchase program through January 21, 2028. The Company’s remaining authorization is $1.0 billion. The Company did not make any open market share repurchases in 2025 or 2024. The Company repurchased $14 million and $13 million of common stock related to the vesting of restricted stock units during the six months ended June 28, 2025 and June 29, 2024, respectively.

Product Warranty Costs

The Company accrues estimated product warranty costs at the time of sale, which are included in cost of sales in the consolidated statements of operations. While the Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers, the Company’s warranty obligation is affected by product failure rates, material usage and service delivery costs incurred in correcting a product failure. The amount of the accrued warranty liability is based on historical information, such as past experience, product failure rates, number of units repaired and estimated costs of material and labor. The liability is reviewed for reasonableness at least quarterly.

The following is a summary of the activity of the Company’s accrued warranty liability for the six months ended June 28, 2025 and June 29, 2024 (in thousands):

		Balance at Beginning of Period				Accruals for Warranties				Settlements Made				Balance at End of Period
Accrued warranty liability:
June 28, 2025		$	11,602			$	3,059			$	(2,734	)		$	11,927
June 29, 2024		$	12,050			$	1,880			$	(3,493	)		$	10,437

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

2 Revenue Recognition

The Company’s deferred revenue liabilities in the consolidated balance sheets consist of the obligation on instrument service contracts and customer payments received in advance, prior to transfer of control of the instrument. The Company records deferred revenue primarily related to its service contracts, where consideration is billable at the beginning of the service period.

The following is a summary of the activity of the Company’s deferred revenue and customer advances for the six months ended June 28, 2025 and June 29, 2024 (in thousands):

		June 28, 2025				June 29, 2024
Balance at the beginning of the period		$	320,046			$	323,516
Recognition of revenue included in balance at beginning of the period			(202,387	)			(192,050	)
Revenue deferred during the period, net of revenue recognized			302,644				251,599
Balance at the end of the period		$	420,303			$	383,065

The Company classified $86 million and $69 million of deferred revenue and customer advances in other long-term liabilities at June 28, 2025 and December 31, 2024, respectively.

The amount of unfulfilled performance obligations as of June 28, 2025, and the time such amounts are expected to be recognized in the future, is as follows (in thousands):

		June 28, 2025
Unfulfilled performance obligations expected to be recognized in:
One year or less		$	340,942
13-24 months			45,852
25 months and beyond			40,601
Total		$	427,395

3 Inventories

Inventories are classified as follows (in thousands):

		June 28, 2025				December 31, 2024
Raw materials		$	235,457			$	227,032
Work in progress			33,305				21,801
Finished goods			271,992				228,428
Total inventories		$	540,754			$	477,261

4 Acquisitions

On May 20, 2025, the Company acquired all of the outstanding equity interests of Optofluidics, Inc., and its wholly owned operating subsidiary, Halo Labs LTD (collectively, “Halo Labs”), for $35 million, net of cash acquired. Halo Labs offers high throughput biopharmaceutical formulation, stability and product quality control tools for aggregate and subvisible particle analysis through the use of custom optics and image processing techniques. As a result of the acquisition, the results of Halo Labs are included in the Company’s consolidated financial statements from the acquisition date.

The Company preliminarily allocated $13 million of the purchase price to intangible assets comprised of developed technology and customer relationships. The developed technology will be amortized over ten years, and the customer relationships will be amortized over five years. The Company allocated $24 million of the purchase price to goodwill, which is not deductible for tax purposes and has been allocated to the Waters operating segment. The principal factor that resulted in recognition of goodwill in the acquisition was that the purchase price was based, in part, on cash flow projections assuming the integration of any acquired technology, distribution channels and products with the Company’s products, which are higher than if the acquired companies’ technology, customer access or products were utilized on a stand-alone basis. The final fair value of the net assets acquired may result in adjustments to these assets and liabilities, including goodwill.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

The assets and liabilities acquired were valued with input from valuation specialists. The Company used various income-approach valuation techniques, which use Level 3 inputs, in determining the fair value of the assets and liabilities acquired. The following table presents the fair values as of the acquisition date of all of the assets and liabilities owned and recorded in connection with the acquisition of Halo Labs assumed on the closing date of May 20, 2025 (in thousands):

Purchase Price
Cash paid		$	35,731
Less: cash acquired			(762	)
Net cash consideration			34,969
Identifiable Net Assets (Liabilities) Acquired
Accounts receivable			962
Inventory			1,296
Prepaid, property, plant and equipment, operating lease and other assets			2,415
Intangible assets			13,400
Accounts payable and accrued expenses			(1,966	)
Operating lease liabilities, deferred revenue and other liabilities			(2,004	)
Tax liabilities			(2,821	)
Total identifiable net assets acquired			11,282
Goodwill			23,687
Net cash consideration		$	34,969

During the three and six months ended June 28, 2025, the effect of net sales, net operating loss, and transaction related costs were immaterial to the Company’s consolidated results. The pro forma effect on the ongoing operations of the Company as though this acquisition had occurred on January 1, 2024 was immaterial to the consolidated financial statements.

5 Goodwill and Other Intangibles

The carrying amount of goodwill was $1.3 billion at both June 28, 2025 and December 31, 2024.

The Company’s intangible assets included in the consolidated balance sheets are detailed as follows (dollars in thousands):

		June 28, 2025												December 31, 2024
		Gross Carrying Amount				Accumulated Amortization				Weighted- Average Amortization Period				Gross Carrying Amount				Accumulated Amortization				Weighted- Average Amortization Period
Capitalized software		$	760,391			$	590,629				5 years			$	662,085			$	508,339				5 years
Purchased intangibles			631,009				270,603				10 years				610,351				241,093				10 years
Trademarks			9,680				—				—				9,680				—				—
Licenses			15,744				11,118				7 years				14,549				9,628				7 years
Patents and other intangibles			128,180				93,527				8 years				117,781				87,480				8 years
Total		$	1,545,004			$	965,877				7 years			$	1,414,446			$	846,540				7 years

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

The Company capitalized intangible assets in the amounts of $32 million and $10 million in the three months ended June 28, 2025 and June 29, 2024, respectively, and $52 million and $20 million in the six months ended June 28, 2025 and June 29, 2024, respectively.

The gross carrying value of intangible assets and accumulated amortization for intangible assets increased by $79 million and $62 million, respectively, in the six months ended June 28, 2025 due to the effects of foreign currency translation.

Amortization expense for intangible assets was $29 million and $25 million for the three months ended June 28, 2025 and June 29, 2024, respectively. Amortization expense for intangible assets was $57 million and $51 million for the six months ended June 28, 2025 and June 29, 2024, respectively. Amortization expense for intangible assets is estimated to be $117 million per year for each of the next five years.

6 Debt

On May 22, 2025, the Company and certain of its subsidiaries, as guarantors, entered into an Amendment and Restatement Agreement (the “Amendment”) in respect of that certain Amended and Restated Credit Agreement, dated as of September 17, 2021 and amended as of March 3, 2023 (the “Existing Credit Agreement”, and as amended by the Amendment, the “Amended Credit Agreement”), with the lenders and issuing banks party thereto, and JPMorgan Chase Bank, N.A., as administrative agent, pursuant to which the Company, among other things, reduced the aggregate total borrowing capacity of its existing senior unsecured revolving credit facility (the “Credit Facility”) by up to $200 million for an aggregate principal amount of up to $1.8 billion. As of June 28, 2025 and December 31, 2024, the Credit Facility had a total of $0.2 billion and $0.4 billion outstanding, respectively.

The Credit Facility will mature on May 22, 2030 subject to the Company’s ability to request, subject to customary conditions, a

one-year

extension to which each lender may, in its discretion, agree. The Company may, subject to customary conditions, also request additional incremental revolving or term loan commitments from the lenders in an aggregate principal amount not to exceed $750 million to which each lender may, in its discretion, agree, provided that the aggregate amount of all commitments, including any such incremental commitments, under the Amended Credit Agreement does not exceed $2.55 billion at any time. Up to $50 million of the Credit Facility is available in the form of letters of credit.

Interest on borrowings under the Credit Facility will accrue at an applicable rate equal to either Term SOFR plus an applicable spread or an alternate base rate plus an applicable spread, in each case based on the lower of the applicable rates determined as set forth in the Amended Credit Agreement based on the Company’s leverage ratio (determined as of the end of the most recent fiscal quarter for which financial statements have been delivered pursuant to the Amended Credit Agreement) or, when established, the Company’s public debt ratings by certain credit rating agencies applicable on such date. These applicable spreads range from 80 basis points to 112.5 basis points over Term SOFR and 0 basis points to 12.5 basis points over the alternate base rate, in each case, as determined in accordance with the provisions of the Amended Credit Agreement. The Company has agreed to pay a facility fee at specified rates as set forth in the Amended Credit Agreement based on its either its leverage ratio (determined as of the end of the most recent fiscal quarter for which financial statements have been delivered pursuant to the Amended Credit Agreement) or the Company’s public debt ratings applicable on such date, as applicable, ranging from 7.5 basis points to 22.5 basis points per annum, on the aggregate commitments of the lenders. The facility fee is payable on a quarterly basis. The Company has the right to prepay borrowings under the Credit Facility at any time, in whole or in part and without premium or penalty (other than, if applicable, any breakage costs). The Company may also reduce its commitments under the Credit Facility at any time.

The Company may use borrowings under the Credit Facility, which may be in United States dollars or the euro equivalent thereof, for general corporate purposes including repayment of debt, financing of acquisitions, payment of related fees and expenses, equity repurchases and working capital. Certain of the Company’s subsidiaries guarantee its obligations under the Amended Credit Agreement. Those guarantees will automatically terminate, and those subsidiaries will be automatically released from those guarantees, if those subsidiaries cease to guarantee the Company’s senior unsecured notes and do not guarantee any other senior debt of the Company.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

The Amended Credit Agreement contains affirmative and negative covenants, including limitations on subsidiary debt, liens, sale and leaseback transactions, mergers and certain restrictive agreements, as well as a financial covenant to not permit a leverage ratio as of the end of any fiscal quarter to exceed 3.50 to 1.00 (which may be increased to 4.25 to 1.00 at the Company’s election as of the last day of the fiscal quarter during which the Company’s closing of a material acquisition for which the aggregate consideration involves cash in the amount of $500 million or more) and a financial covenant to not permit an interest coverage ratio as of the end of any fiscal quarter for the period of four consecutive fiscal quarters then ended to be less than 3.50 to 1.00. The Credit Facility contains certain representations, warranties and events of default (which are, in some cases, subject to certain exceptions, thresholds and grace periods) including, but not limited to,

non-payment

of principal and interest, failure to perform or observe covenants, breaches of representations and warranties and certain bankruptcy-related events.

As of both June 28, 2025 and December 31, 2024, the Company had a total of $1.3 billion of outstanding senior unsecured notes. Interest on the fixed rate senior unsecured notes is payable semi-annually each year. The Company may prepay all or some of the senior unsecured notes at any time in an amount not less than 10% of the aggregate principal amount outstanding. In the event of a change in control of the Company (as defined in the note purchase agreement), the Company may be required to prepay the senior unsecured notes at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest. These senior unsecured notes require that the Company comply with an interest coverage ratio test of not less than 3.50:1 for any period of four consecutive fiscal quarters and a leverage ratio test of not more than 3.50:1 as of the end of any fiscal quarter. In addition, these senior unsecured notes include customary negative covenants, affirmative covenants, representations and warranties and events of default.

The Company had the following outstanding debt at June 28, 2025 and December 31, 2024 (in thousands):

		June 28, 2025				December 31, 2024
Senior unsecured notes - Series K - 3.44%, due May 2026		$	160,000			$	—
Senior unsecured notes - Series N - 1.68%, due March 2026			100,000				—
Total notes payable and debt, current			260,000				—
Senior unsecured notes - Series K - 3.44%, due May 2026			—				160,000
Senior unsecured notes - Series L - 3.31%, due September 2026			200,000				200,000
Senior unsecured notes - Series M - 3.53%, due September 2029			300,000				300,000
Senior unsecured notes - Series N - 1.68%, due March 2026			—				100,000
Senior unsecured notes - Series O - 2.25%, due March 2031			400,000				400,000
Senior unsecured notes - Series P - 4.91%, due May 2028			50,000				50,000
Senior unsecured notes - Series Q - 4.91%, due May 2030			50,000				50,000
Credit agreement			200,000				370,000
Unamortized debt issuance costs			(3,034	)			(3,512	)
Total long-term debt			1,196,966				1,626,488
Total debt		$	1,456,966			$	1,626,488

As of both June 28, 2025 and December 31, 2024, the Company had a total amount available to borrow under the Credit Facility of $1.6 billion after outstanding letters of credit. The weighted-average interest rates applicable to the senior unsecured notes and credit agreement borrowings collectively were 3.46% and 3.72% at June 28, 2025 and December 31, 2024, respectively. As of June 28, 2025, the Company was in compliance with all debt covenants.

The Company and its foreign subsidiaries also had available short-term lines of credit totaling $111 million at both June 28, 2025 and December 31, 2024, for the purpose of short-term borrowing and issuance of commercial guarantees. None of the Company’s foreign subsidiaries had outstanding short-term borrowings as of June 28, 2025 or December 31, 2024.

7 Income Taxes

The four principal jurisdictions in which the Company manufactures are the U.S., Ireland, the U.K. and Singapore, where the statutory tax rates were 21%, 12.5%, 25% and 17%, respectively, as of June 28, 2025. The Company has a Development and Expansion Incentive in Singapore that provides a concessionary income tax rate of 5% on certain types of income for the period April 1, 2021 through March 31, 2026. The effect of applying the concessionary income tax rate rather than the statutory tax rate to income arising from qualifying activities in Singapore increased the Company’s net income for the six months ended June 28, 2025 and June 29, 2024 by $1.5 million and $5 million, respectively, and increased the Company’s net income per diluted share by $0.03 and $0.09, respectively.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

The Company’s effective tax rate for the three months ended June 28, 2025 and June 29, 2024 was 17.2% and 15.7%, respectively. The increase between the effective tax rates can be primarily attributed to the impact of discrete tax benefits in the prior year and differences in the proportionate amounts of

pre-tax

income recognized in jurisdictions with different effective tax rates.

The Company’s effective tax rate for the six months ended June 28, 2025 and June 29, 2024 was 16.2% and 13.8%, respectively. The increase between the effective tax rates can primarily be attributed to the impact of discrete tax benefits in the prior year and differences in the proportionate amounts of

pre-tax

income recognized in jurisdictions with different effective tax rates.

The Company accounts for its uncertain tax return positions in accordance with the accounting standards for income taxes, which require financial statement reporting of the expected future tax consequences of uncertain tax reporting positions on the presumption that all concerned tax authorities possess full knowledge of those tax reporting positions, as well as all of the pertinent facts and circumstances, but prohibit any discounting of unrecognized tax benefits associated with those reporting positions for the time value of money. The Company continues to classify interest and penalties related to unrecognized tax benefits as a component of the provision for income taxes.

The Company’s gross unrecognized tax benefits, excluding interest and penalties, at June 28, 2025 and June 29, 2024 were $18 million and $15 million, respectively. With limited exceptions, the Company is no longer subject to tax audit examinations in significant jurisdictions for the years ended on or before December 31, 2019. The Company continuously monitors the lapsing of statutes of limitations on potential tax assessments for related changes in the measurement of unrecognized tax benefits, related net interest and penalties, and deferred tax assets and liabilities.

Effective in 2024, various foreign jurisdictions began implementing aspects of the guidance issued by the Organization for

Economic Co-operation and

Development related to the new Pillar Two system of global minimum tax rules. These changes in tax law did not have a material impact on the Company’s financial position, results of operations and cash flows for the three and six months ended June 28, 2025. The Company continues to monitor the adoption of the Pillar Two rules in additional jurisdictions.

On July 4, 2025, the US government enacted the One Big Beautiful Tax Bill Act (“OBBB”), enacting changes to the United States federal tax code, including adjustments to corporate income tax rates and certain deduction limitations. The Company is currently evaluating the impact the enactment of the OBBB will have on the Company’s financial position, results of operations and cash flows.

8 Litigation

From time to time, the Company and its subsidiaries are involved in various litigation matters arising in the ordinary course of business. The Company believes it has meritorious arguments in its current litigation matters and believes any outcome, either individually or in the aggregate, will not be material to the Company’s financial position, results of operations or cash flows. During the six months ended June 29, 2024, the Company recorded $10 million of patent litigation settlement provisions and related costs. No litigation provisions were recorded by the Company during the six months ended June 28, 2025.

9 Other Commitments and Contingencies

The Company licenses certain technology and software from third parties in the ordinary course of business. Future minimum fees payable under existing technology and software license agreements as of June 28, 2025 are $84 million for the years ended December 31, 2025 and thereafter. The software license agreements are long-term contracts and are not cancellable by the Company until the expiration of their initial term. The amounts owed under these contracts are included in both other assets and other long-term liabilities on the Company’s consolidated balance sheet as of June 28, 2025. In December 2024, the Company’s Board of Directors approved the implementation of a new worldwide enterprise resource planning system (“ERP”). The Company anticipates spending approximately $130 million on the ERP implementation over the next three years. The Company expects to use existing cash and its credit facility to fund the ERP implementation. For the six months ended June 28, 2025, the Company has incurred $11 million of capitalized costs included in other assets and $7

million of operating costs included in the consolidated statement of operations for the ERP system implementation.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

The Company enters into standard indemnification agreements in its ordinary course of business. Pursuant to these agreements, the Company indemnifies, holds harmless and agrees to reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally the Company’s business partners or customers, in connection with patent, copyright or other intellectual property infringement claims by any third party with respect to its current products, as well as claims relating to property damage or personal injury resulting from the performance of services by the Company or its subcontractors. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited. Historically, the Company’s costs to defend lawsuits or settle claims relating to such indemnity agreements have been minimal and management accordingly believes the estimated fair value of these agreements is immaterial.

10 Earnings Per Share

Basic and diluted EPS calculations are detailed as follows (in thousands, except per share data):

		Three Months Ended June 28, 2025
		Net Income (Numerator)				Weighted- Average Shares (Denominator)				Per Share Amount
Net income per basic common share		$	147,111				59,515			$	2.47
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities			—				141				—
Net income per diluted common share		$	147,111				59,656			$	2.47

		Three Months Ended June 29, 2024
		Net Income (Numerator)				Weighted- Average Shares (Denominator)				Per Share Amount
Net income per basic common share		$	142,737				59,339			$	2.41
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities			—				112				(0.01	)
Net income per diluted common share		$	142,737				59,451			$	2.40

		Six Months Ended June 28, 2025
		Net Income (Numerator)				Weighted- Average Shares (Denominator)				Per Share Amount
Net income per basic common share		$	268,492				59,478			$	4.51
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities			—				208				(0.01	)
Net income per diluted common share		$	268,492				59,686			$	4.50

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

		Six Months Ended June 29, 2024
		Net Income (Numerator)				Weighted- Average Shares (Denominator)				Per Share Amount
Net income per basic common share		$	244,933				59,287			$	4.13
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities			—				158				(0.01	)
Net income per diluted common share		$	244,933				59,445			$	4.12

The Company had 92 thousand and 73 thousand stock options that were antidilutive due to having higher exercise prices than the Company’s average stock price during the three and six months ended June 28, 2025

, respecti

vely. For the three and six months ended June 29, 2024, the Company had 270 thousand and 128 thousand stock options that were antidilutive, respectively. These securities were not included in the computation of diluted EPS. The effect of dilutive securities was calculated using the treasury stock method.

11 Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive loss are detailed as follows (in thousands):

		Currency Translation				Unrealized Loss on Retirement Plans				Unrealized Loss on Derivative Instruments				Accumulated Other Comprehensive Loss
Balance at December 31, 2024		$	(154,924	)		$	(254	)		$	(105	)		$	(155,283	)
Other comprehensive income (loss), net of tax			40,268				(136	)			(1,620	)			38,512
Balance at June 28, 2025		$	(114,656	)		$	(390	)		$	(1,725	)		$	(116,771	)

12 Business Segment Information

The accounting standards for segment reporting establish standards for reporting information about operating segments in annual financial statements and require selected information for those segments to be presented in interim financial reports of public business enterprises. They also establish standards for related disclosures about products and services, geographic areas and major customers. The Company’s Chief Executive Officer is the chief operating decision maker (“CODM”). The CODM evaluates the business based on our two operating segments: Waters and TA.

The Waters operating segment is primarily in the business of designing, manufacturing, selling and servicing LC and MS instruments, columns and other precision chemistry consumables that can be integrated and used along with other analytical instruments. The TA operating segment is primarily in the business of designing, manufacturing, selling and servicing thermal analysis, rheometry and calorimetry instruments. The Company’s two operating segments have similar economic characteristics; product processes; products and services; types and classes of customers; methods of distribution; and regulatory environments. Because of these similarities, the two segments have been aggregated into one reporting segment for financial statement purposes.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

Net sales for the Company’s products and services are as follows for the three and six months ended June 28, 2025 and June 29, 2024 (in thousands):

		Three Months Ended								Six Months Ended
		June 28, 2025				June 29, 2024				June 28, 2025				June 29, 2024
Product net sales:
Waters instrument systems		$	252,795			$	235,228			$	465,190			$	426,487
Chemistry consumables			164,985				141,085				302,622				275,292
TA instrument systems			55,620				58,831				106,118				109,516
Total product sales			473,400				435,144				873,930				811,295
Service net sales:
Waters service			271,057				246,248				508,322				482,681
TA service			26,875				27,137				50,785				51,392
Total service sales			297,932				273,385				559,107				534,073
Total net sales		$	771,332			$	708,529			$	1,433,037			$	1,345,368

Net sales are attributable to geographic areas based on the region of destination. Geographic sales information is presented below for the three and six months ended June 28, 2025 and June 29, 2024 (in thousands):

		Three Months Ended								Six Months Ended
		June 28, 2025				June 29, 2024				June 28, 2025				June 29, 2024
Net Sales:
Asia:
China		$	117,130			$	100,105			$	208,003			$	185,850
Asia Other			148,810				137,326				278,713				259,140
Total Asia			265,940				237,431				486,716				444,990
Americas:
United States			230,131				231,931				445,390				434,770
Americas Other			50,609				42,537				90,887				80,869
Total Americas			280,740				274,468				536,277				515,639
Europe			224,652				196,630				410,044				384,739
Total net sales		$	771,332			$	708,529			$	1,433,037			$	1,345,368

Net sales by customer class are as follows for the three and six months ended June 28, 2025 and June 29, 2024 (in thousands):

		Three Months Ended								Six Months Ended
		June 28, 2025				June 29, 2024				June 28, 2025				June 29, 2024
Pharmaceutical		$	461,968			$	415,747			$	853,019			$	789,954
Industrial			237,655				221,385				441,020				416,719
Academic and government			71,709				71,397				138,998				138,695
Total net sales		$	771,332			$	708,529			$	1,433,037			$	1,345,368

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

Net sales for the Company recognized at a point in time versus over time are as follows for the three and six months ended June 28, 2025 and June 29, 2024 (in thousands):

		Three Months Ended								Six Months Ended
		June 28, 2025				June 29, 2024				June 28, 2025				June 29, 2024
Net sales recognized at a point in time:
Instrument systems		$	308,415			$	294,059			$	571,308			$	536,003
Chemistry consumables			164,985				141,085				302,622				275,292
Service sales recognized at a point in time (time & materials)			100,420				92,075				181,388				175,400
Total net sales recognized at a point in time			573,820				527,219				1,055,318				986,695
Net sales recognized over time:
Service and software maintenance sales recognized over time (contracts)			197,512				181,310				377,719				358,673
Total net sales		$	771,332			$	708,529			$	1,433,037			$	1,345,368

The Company’s segment performance measure is net income attributable to Waters shareholders, which is used by the Company’s CODM when assessing performance and allocating capital and resources to its business. Significant segment expenses are presented in the Company’s consolidated statements of operations. Additional disaggregated significant segment expenses, that are not separately presented on the Company’s consolidated statements of operations, are presented below.

The significant segment expenses, revenues and net income of the Company’s one reportable segment are as follows for the three and six months ended June 28, 2025 and June 29, 2024 (in thousands):

		Three Months Ended								Six Months Ended
		June 28, 2025				June 29, 2024				June 28, 2025				June 29, 2024
Total sales, net		$	771,332			$	708,529			$	1,433,037			$	1,345,368
Less:
Labor costs within selling and administrative and research and development expenses			(164,254	)			(146,668	)			(316,635	)			(300,261	)
Material purchases			(113,302	)			(125,839	)			(214,861	)			(234,400	)
Labor costs within product and service cost of sales			(96,175	)			(85,351	)			(184,582	)			(171,722	)
Other segment expenses			(209,388	)			(161,559	)			(377,001	)			(316,027	)
Interest expense and other income, net			(10,523	)			(19,700	)			(19,380	)			(38,690	)
Provision for income taxes			(30,579	)			(26,675	)			(52,086	)			(39,335	)
Net income		$	147,111			$	142,737			$	268,492			$	244,933

The other segment expenses include depreciation and amortization expenses, facilities and information technology costs, travel, freight, professional fees and all other costs.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

13 Recent Accounting Standard Changes and Developments

Recently Adopted Accounting Standards

There were no additions to the new accounting pronouncement adoptions as described in the Company’s Annual Report on Form

10-K

for the year ended December 31, 2024. Other amendments to U.S. GAAP that have been issued by the Financial Accounting Standards Board (the “FASB”) or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s consolidated financial statements upon adoption.

Recently Issued Accounting Standards

There were no additions to the new accounting pronouncements not yet adopted as described in the Company’s Annual Report on Form

10-K

for the year ended December 31, 2024. Other amendments to U.S. GAAP that have been issued by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s consolidated financial statements upon adoption.

14 Subsequent Events

On July 13, 2025, the Company entered into a definitive agreement (the “Merger Agreement”) to purchase and combine Becton, Dickinson & Company’s (“BD”) Biosciences & Diagnostic Solutions business with Waters Corporation (the “Merger”). The transaction is structured as a Reverse Morris Trust transaction, where BD’s Biosciences & Diagnostic Solutions business will be spun off to BD shareholders and simultaneously merged with a wholly owned subsidiary of the Company for a combined stock and cash purchase price valued at approximately $17.5 billion

as of the date of signing

. BD’s shareholders are estimated to own approximately 39.2% of the combined company, and existing Waters Corporation shareholders are estimated to own approximately 60.8% of the combined company. BD will also receive cash of approximately $4 billion prior to completion of the combination, subject to adjustment for cash, working capital and indebtedness. The transaction is expected to be generally tax-free for U.S. federal income tax purposes to BD and BD’s shareholders. The Company is expected to assume approximately $4 billion of incremental debt. The transaction is expected to close around the end of the first quarter of calendar year 2026, subject to receipt of required regulatory approvals, Waters Corporation shareholder approval and satisfaction of other customary closing conditions.

The Merger Agreement also contains specified termination rights for the Company and BD, including in the event that the Merger has

not

been consummated on or prior to July 13, 2026 (subject to extension in connection with outstanding regulatory approvals). Additionally, the Merger Agreement requires the Company to pay BD a termination fee of

$733

million if the Merger Agreement is terminated under certain circumstances.

In connection with the Merger Agreement, the Company and a financial institution executed a 364-day bridge loan facility commitment letter, pursuant to which such financial institution has committed to provide bridge financing of $1.8 billion to fund dividends, fees and expenses related to the transactions contemplated by the Merger Agreement, on the terms and conditions set forth therein. The Company has incurred $14 million of transaction-related expenses through June 28, 2025. Based on information available through the date of this filing, if the transaction closes, the Company estimates it will incur transaction-related expenses and financing fees of approximately $120 million.

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