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What changed in HEICO CORP's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of HEICO CORP's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+193 added−190 removedSource: 10-K (2025-12-22) vs 10-K (2024-12-19)

Top changes in HEICO CORP's 2025 10-K

193 paragraphs added · 190 removed · 165 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

48 edited+8 added−11 removed94 unchanged
Biggest changeCopies of the above referenced materials will be made available, free of charge, upon written request to the Corporate Secretary at HEICO Corporation, 3000 Taft Street, Hollywood, Florida 33021. 15 Index Information About Our Executive Officers Our executive officers are appointed by the Board of Directors and serve at the discretion of the Board.
Biggest changeAlso located on the website are our Corporate Governance Guidelines, Finance/Audit Committee Charter, Nominating & Corporate Governance Committee Charter, and Compensation Committee Charter. 15 Index Copies of the above-mentioned materials will be made available, free of charge, upon written request to the Corporate Secretary at HEICO Corporation, 3000 Taft Street, Hollywood, Florida 33021.
The ETG collectively designs, manufactures and sells various types of electronic, data and microwave, and electro-optical products, including infrared simulation and test equipment, laser rangefinder receivers, electrical power supplies, back-up power supplies, power conversion products, underwater locator beacons, emergency locator transmission beacons, flight deck annunciators, panels, and indicators, electromagnetic and radio frequency interference shielding and filters, high power capacitor charging power supplies, amplifiers, traveling wave tube amplifiers, photodetectors, amplifier modules, microwave power modules, flash lamp drivers, laser diode drivers, arc lamp power supplies, custom power supply designs, cable assemblies, high voltage power supplies, high voltage interconnection devices and wire, high voltage energy generators, high frequency power delivery systems; memory products, including three-dimensional microelectronic and stacked memory, static random-access memory (SRAM), and electronically erasable programmable read-only memory (EEPROM); harsh environment electronic connectors and other interconnect products, radio frequency ("RF") and microwave amplifiers, transmitters, and receivers and integrated assemblies, sub-assemblies and components; RF sources, detectors and controllers, wireless cabin control systems, solid state power distribution and management systems, proprietary in-cabin power and entertainment components and subsystems, crashworthy and ballistically self-sealing auxiliary fuel systems, nuclear radiation detectors, communications and electronic intercept receivers and tuners, fuel level sensing systems, high-speed interface products that link devices, high performance active antenna systems and airborne antennas for commercial and military aircraft, precision guided munitions, other defense applications and commercial uses; silicone material for a variety of demanding applications; precision power analog monolithic, hybrid and open frame components; high-reliability ceramic-to-metal feedthroughs and connectors, technical surveillance countermeasures (TSCM) equipment to detect devices used for espionage and information theft; rugged small-form factor embedded computing solutions; custom high power filters and filter assemblies; test sockets and adapters for both engineering and production use of semiconductor devices; radiation assurance services and products; and high reliability ("Hi-Rel"), complex, passive electronic components and rotary joint assemblies for mostly aerospace and defense applications, in addition to other high-end applications, such as medical and energy uses, including emerging "clean energy" and electrification applications.
The ETG collectively designs, manufactures and sells various types of electronic, data and microwave, and electro-optical products, including infrared simulation and test equipment, laser rangefinder receivers, electrical power supplies, back-up power supplies, power conversion products, underwater locator beacons, emergency locator transmission beacons, flight deck annunciators, panels, indicators, electromagnetic and radio frequency interference shielding and filters, high power capacitor charging power supplies, amplifiers, traveling wave tube amplifiers, photodetectors, amplifier modules, microwave power modules, flash lamp drivers, laser diode drivers, arc lamp power supplies, custom power supply designs, cable assemblies, high voltage power supplies, high voltage interconnection devices and wire, high voltage energy generators, high frequency power delivery systems; memory products, including three-dimensional microelectronic and stacked memory, static random-access memory (SRAM), and electronically erasable programmable read-only memory (EEPROM); harsh environment electronic connectors and other interconnect products, radio frequency ("RF") and microwave amplifiers, transmitters, and receivers and integrated assemblies, sub-assemblies and components; RF sources, detectors and controllers, wireless cabin control systems, solid state power distribution and management systems, proprietary in-cabin power and entertainment components and subsystems, cockpit displays and other avionics components, crashworthy and ballistically self-sealing auxiliary fuel systems, nuclear radiation detectors, communications and electronic intercept receivers and tuners, fuel level sensing systems, high-speed interface products that link devices, high performance active antenna systems and airborne antennas for commercial and military aircraft, precision guided munitions, other defense applications and commercial uses; silicone material for a variety of demanding applications; precision power analog monolithic, hybrid and open frame components; high-reliability ceramic-to-metal feedthroughs and connectors, technical surveillance countermeasures (TSCM) equipment to detect devices used for espionage and information theft; rugged small-form factor embedded computing solutions; custom high power filters and filter assemblies; test sockets and adapters for both engineering and production use of semiconductor devices; radiation assurance services and products; and high reliability ("Hi-Rel"), complex, passive electronic components and rotary joint assemblies for mostly aerospace and defense applications, in addition to other high-end applications, such as medical and energy uses, including emerging "clean energy" and electrification applications.
There has been no material adverse effect to our consolidated financial statements nor competitive positions as a result of these government regulations. Environmental Regulation Our operations are subject to extensive, and frequently changing, federal, state and local environmental laws and substantial related regulation by government agencies, including the Environmental Protection Agency.
There has been no material adverse effect on our consolidated financial statements nor competitive positions as a result of these government regulations. Environmental Regulation Our operations are subject to extensive, and frequently changing, federal, state and local environmental laws and substantial related regulation by government agencies, including the Environmental Protection Agency.
In recent years, the FAA granted us PMAs for approximately 350 to 550 new parts and we develop numerous new proprietary repairs per year; however, no assurance can be given that the FAA will continue to grant PMAs or DER-approved 5 Index repairs or that we will achieve acceptable levels of net sales and gross profits on such parts or repairs in the future.
In recent years, the FAA granted us PMAs for approximately 400 to 550 new parts and we develop numerous new proprietary repairs per year; however, no assurance can be given that the FAA will continue to grant PMAs or DER- 5 Index approved repairs or that we will achieve acceptable levels of net sales and gross profits on such parts or repairs in the future.
In that regard, we closely monitor the FAA and industry trade groups in an attempt to understand how possible future regulations might impact us. Our businesses which sell defense products directly to the U.S. Government or for use in systems delivered to the U.S. Government can be subject to various laws and regulations governing pricing and other factors.
In that regard, we closely monitor the FAA and industry trade groups to understand how possible future regulations might impact us. Our businesses which sell defense products directly to the U.S. Government or for use in systems delivered to the U.S. Government can be subject to various laws and regulations governing pricing and other factors.
Additionally, our microwave products include custom high power filters and filter assemblies, converters, receivers, transmitters, amplifiers, frequency sources and related sub-systems that address the majority of major satellite frequencies. We believe we are a leading supplier of the niche products which we design and manufacture for this market, a market that includes commercial satellites.
Additionally, our microwave products include custom high power filters and filter assemblies, converters, receivers, transmitters, amplifiers, frequency sources and related sub-systems that address most major satellite frequencies. We believe we are a leading supplier of the niche products which we design and manufacture for this market, a market that includes commercial satellites.
Since 1990, we have completed approximately 103 acquisitions complementing the niche segments of the aviation, defense, space, medical, telecommunications and electronics industries in which we operate. We typically target acquisition opportunities that allow us to broaden our product offerings, services and technologies while expanding our customer base and geographic presence.
Since 1990, we have completed approximately 107 acquisitions complementing the niche segments of the aviation, defense, space, medical, telecommunications and electronics industries in which we operate. We typically target acquisition opportunities that allow us to broaden our product offerings, services and technologies while expanding our customer base and geographic presence.
HEICO has continuously operated in the aerospace industry for over 65 years. Since assuming control in 1990, our current management has achieved significant sales and profit growth through a broadened line of product offerings, an expanded customer base, increased research and development expenditures and the completion of a number of acquisitions.
HEICO has continuously operated in the aerospace industry for over 65 years. Since assuming control in 1990, our current management has achieved significant sales and profit growth through a broadened line of product offerings, an expanded customer base, increased research and development expenditures and the completion of many acquisitions.
We believe that we are the largest independent supplier of non-OEM jet engine and aircraft component replacement parts, and in recent years and inclusive of acquisitions, we are now adding new products to our line at a rate of approximately 350 to 550 Parts Manufacturer Approvals (“PMA” or “PMAs”) per year.
We believe that we are the largest independent supplier of non-OEM jet engine and aircraft component replacement parts, and in recent years and inclusive of acquisitions, we are now adding new products to our line at a rate of approximately 400 to 550 Parts Manufacturer Approvals (“PMA” or “PMAs”) per year.
Notwithstanding these burdens, we believe that we are in material compliance with all federal, state and local environmental laws and regulations governing our operations. There has been no material adverse effect to our consolidated financial statements nor competitive positions as a result of these environmental regulations.
Notwithstanding these burdens, we believe that we are in material compliance with all federal, state and local environmental laws and regulations governing our operations. There has been no material adverse effect on our consolidated financial statements nor competitive positions as a result of these environmental regulations.
Aircraft operators must maintain logs concerning the utilization and condition of aircraft engines, life-limited engine parts and airframes. In addition, the FAA requires that various maintenance routines be performed on 12 Index aircraft engines, some engine parts, and airframes at regular intervals based on cycles or flight time.
Aircraft operators must maintain logs concerning the utilization and condition of aircraft engines, life-limited engine parts and airframes. In addition, the FAA requires that various maintenance routines be performed on aircraft engines, some engine parts, and airframes at regular intervals based on cycles or flight time.
The inspection, maintenance and repair procedures for the various types of aircraft and equipment are prescribed by regulatory authorities and can be performed only by certified repair facilities utilizing certified technicians. Certification and conformance is required prior to installation of a part on an aircraft.
The inspection, maintenance and repair procedures for the various types of aircraft and equipment are prescribed by regulatory authorities and can be performed only by certified repair facilities utilizing certified technicians. Certification and conformance is required 12 Index prior to installation of a part on an aircraft.
We believe that the ETG's research and development capabilities are a significant component of our historical success and an integral part of our growth strategy. 10 Index Distribution, Sales, Marketing and Customers Each of our operating segments independently conducts distribution, sales and marketing efforts directed at their respective customers and industries and, in some cases, collaborates with other operating divisions and subsidiaries within its group for cross-marketing efforts.
We believe that the ETG's research and development capabilities are a significant component of our historical success and an integral part of our growth strategy. 10 Index Distribution, Sales, Marketing and Customers Each of our operating segments independently conducts distribution, sales and marketing efforts directed at their respective customers and industries and, in some cases, collaborates with other operating divisions and subsidiaries within the Company for cross-marketing efforts.
Additionally, the FSG manufactures advanced niche components and complex composite assemblies for commercial aviation, defense and space applications; manufactures expanded foil mesh, which is integrated into composite aerospace structures for lightning strike protection in fixed and rotary wing aircraft; performs tight-tolerance machining, brazing, fabricating and welding services for aerospace, defense and other industrial applications; and designs, manufactures and distributes emergency descent devices ("EDDs"), personnel and cargo parachute products, heavy airdrop platforms, and other highly-engineered products.
Additionally, the FSG manufactures advanced niche components and complex composite assemblies for commercial aviation, defense and space applications; manufactures expanded foil mesh, which is integrated into composite aerospace structures for lightning strike protection in fixed and rotary wing aircraft; performs tight-tolerance machining, brazing, fabricating and welding services for aerospace, defense and other industrial applications; produces and sells missile hardware and components; and designs, manufactures and distributes emergency descent devices ("EDDs"), personnel and cargo parachute products, heavy airdrop platforms, and other highly-engineered products.
The ETG offers Hi-Rel, complex, passive electronic components and rotary joint assemblies for mostly aerospace and defense applications, in addition to other high-end applications, such as medical and energy uses, including emerging "clean energy" and electrification applications. As part of our growth strategy, we have continued to invest in our research and development activities.
The ETG designs and manufactures Hi-Rel, complex, passive electronic components and rotary joint assemblies for mostly aerospace and defense applications, in addition to other high-end applications, such as medical and energy uses, including emerging "clean energy" and electrification applications. As part of our growth strategy, we have continued to invest in our research and development activities.
These materials are also available free of charge on the SEC’s website at http://www.sec.gov. The information on or obtainable through our website is not incorporated into this Annual Report on Form 10-K. We have adopted a code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller and other persons performing similar functions.
These materials are also available free of charge on the SEC’s website at https://www.sec.gov. The information on or obtainable through our website is not incorporated into this Annual Report on Form 10-K. We have adopted a code of ethics that applies to our co-principal executive officers, principal financial officer, principal accounting officer or controller and other persons performing similar functions.
The ETG derived approximately 51%, 49% and 56% of its net sales in fiscal 2024, 2023 and 2022, respectively, from the sale of products and services to U.S. and foreign military agencies, prime defense contractors and both commercial and defense satellite and spacecraft manufacturers.
The ETG derived approximately 51%, 51% and 49% of its net sales in fiscal 2025, 2024 and 2023, respectively, from the sale of products and services to U.S. and foreign military agencies, prime defense contractors and both commercial and defense satellite and spacecraft manufacturers.
Mendelson was the Chief Operating Officer of the Company’s former MediTek Health Corporation subsidiary from 1995 until its profitable sale in 1996. Mr. Mendelson is a co-founder, and, since 1987, has been President of Mendelson International Corporation, a private investment company, which is a shareholder of HEICO. Mr.
Mendelson was the Chief Operating Officer of the Company’s former 16 Index MediTek Health Corporation subsidiary from 1995 until its profitable sale in 1996. Mr. Mendelson is a co-founder, and, since 1987, has been President of Mendelson International Corporation, a private investment company that is a shareholder of HEICO. Mr.
No one customer accounted for sales of 10% or more of total consolidated sales from continuing operations during any of the last three fiscal years. Net sales to our five largest customers accounted for approximately 19%, 18% and 21% of total net sales in fiscal 2024, 2023 and 2022, respectively.
No one customer accounted for sales of 10% or more of total consolidated sales from continuing operations during any of the last three fiscal years. Net sales to our five largest customers accounted for approximately 20%, 19% and 18% of total net sales in fiscal 2025, 2024 and 2023, respectively.
Our business is comprised of two operating segments: The Flight Support Group . Our Flight Support Group (“FSG”), consisting of HEICO Aerospace Holdings Corp. and HEICO Flight Support Corp. and their collective subsidiaries, accounted for 68%, 60% and 57% of our net sales in fiscal 2024, 2023 and 2022, respectively.
Our business is comprised of two operating segments: The Flight Support Group . Our Flight Support Group (“FSG”), consisting of HEICO Aerospace Holdings Corp. and HEICO Flight Support Corp. and their collective subsidiaries, accounted for 70%, 68% and 60% of our net sales in fiscal 2025, 2024 and 2023, respectively.
We design and manufacture next generation wireless cabin control systems, solid state power distribution and management systems, fuel level sensing systems, power distribution solutions and proprietary in-cabin power and entertainment components and subsystems primarily for business jets, general aviation, and the military/defense market.
We design and manufacture next generation wireless cabin control systems, solid state power distribution and management systems, fuel level sensing systems, proprietary in-cabin power and entertainment components and subsystems, and cockpit displays and other avionics components primarily for business jets, general aviation, and the military/defense market.
During the same period, we improved our net income 2 Index from $2.0 million to $514.1 million, representing a compound annual growth rate of approximately 18%. Disciplined Acquisition Strategy Acquisitions have been an important element of our growth strategy over the past thirty-four years, supplementing our organic growth.
During the same period, we improved our net income from 2 Index $2.0 million to $690.4 million, representing a compound annual growth rate of approximately 18%. Disciplined Acquisition Strategy Acquisitions have been an important element of our growth strategy over the past thirty-five years, supplementing our organic growth.
Moreover, smaller competitors may be in a position to offer more attractive pricing as a result of lower labor costs and other factors. Our jet engine and aircraft component replacement parts business competes primarily with aircraft engine and aircraft component OEMs. The competition is principally based on price and service to the extent that our parts are interchangeable.
Moreover, smaller competitors may be able to offer more attractive pricing because of lower labor costs and other factors. Our jet engine and aircraft component replacement parts business competes primarily with aircraft engine and aircraft component OEMs. The competition is principally based on price and service to the extent that our parts are interchangeable.
Our Electronic Technologies Group (“ETG”), consisting of HEICO Electronic Technologies Corp. and its subsidiaries, accounted for 32%, 40% and 43% of our net sales in fiscal 2024, 2023 and 2022, respectively.
Our Electronic Technologies Group (“ETG”), consisting of HEICO Electronic Technologies Corp. and its subsidiaries, accounted for 30%, 32% and 40% of our net sales in fiscal 2025, 2024 and 2023, respectively.
As of October 31, 2024, we had approximately 10,000 full-time and part-time employees including approximately 5,100 in the Flight Support Group (of whom approximately 1,000 were employed by foreign subsidiaries) and approximately 4,900 in the Electronic Technologies Group (of whom approximately 2,000 were employed by foreign subsidiaries). None of our employees are represented by a U.S. domestic union.
As of October 31, 2025, we had approximately 11,100 full-time and part-time employees including approximately 5,300 in the Flight Support Group (of whom approximately 900 were employed by foreign subsidiaries) and approximately 5,800 in the Electronic Technologies Group (of whom approximately 2,600 were employed by foreign subsidiaries). None of our employees are represented by a U.S. domestic union.
We believe that our operations are in material compliance with OSHA’s health and safety requirements. 13 Index Insurance We are a named insured under policies which include the following coverage: (i) product liability, including grounding; (ii) personal property, inventory and business interruption at our facilities; (iii) general liability coverage; (iv) employee benefit liability; (v) international liability and automobile liability; (vi) umbrella liability coverage; and (vii) various other activities or items, each subject to certain limits and deductibles.
Insurance We are a named insured under policies which include the following coverage: (i) product liability, including grounding; (ii) personal property, inventory and business interruption at our facilities; (iii) general liability coverage; (iv) employee benefit liability; (v) international liability and automobile liability; (vi) umbrella liability coverage; and (vii) various other activities or items, each subject to certain limits and deductibles.
He is a member of the Board of Governors, and has previously served as an Ex-Officio Member of the Executive Committee, and Chair of the Civil Aviation Leadership Council, of the Aerospace Industries Association (“AIA”) in Washington, D.C., of which HEICO is a member. In addition, Mr.
Mendelson is a member of the Board of Governors of the Aerospace Industries Association (“AIA”) in Washington, D.C., and has previously served as an Ex-Officio Member of its Executive Committee and as Chair of the AIA Civil Aviation Leadership Council.
As a result of internal growth and acquisitions, our net sales from continuing operations have grown from $26.2 million in fiscal 1990 to $3,857.7 million in fiscal 2024, representing a compound annual growth rate of approximately 16%.
As a result of internal growth and acquisitions, our net sales from continuing operations have grown from $26.2 million in fiscal 1990 to $4,485.0 million in fiscal 2025, representing a compound annual growth rate of approximately 16%.
As part of our growth strategy, we have continued to increase our research and development activities. Research and development expenditures by the FSG, which were approximately $.3 million in fiscal 1991, increased to approximately $36.7 million in fiscal 2024, $26.4 million in fiscal 2023 and $22.2 million in fiscal 2022.
As part of our growth strategy, we have continued to increase our research and development activities. Research and development expenditures by the FSG were $43.7 million in fiscal 2025, $36.7 million in fiscal 2024 and $26.4 million in fiscal 2023.
Research and development expenditures by the ETG were $74.5 million in fiscal 2024, $69.4 million in fiscal 2023 and $53.9 million in fiscal 2022.
Research and development expenditures by the ETG were $77.2 million in fiscal 2025, $74.5 million in fiscal 2024 and $69.4 million in fiscal 2023.
An expendable is generally a part which is used and not thereafter repaired for further use. 3 Index Jet engine and aircraft component replacement parts are classified within the industry as (i) factory-new; (ii) new surplus; (iii) overhauled; (iv) repairable; and (v) as removed. A factory-new or new surplus part is one that has never been installed or used.
An expendable is generally a part which is used up and replaced as opposed to being repaired for further use. 3 Index Jet engine and aircraft component replacement parts are classified within the industry as (i) factory-new; (ii) new surplus; (iii) overhauled; (iv) repairable; and (v) as removed.
Factory-new parts are purchased from FAA-approved manufacturers (such as HEICO or OEMs) or their authorized distributors. New surplus parts are purchased from excess stock of airlines, repair facilities or other redistributors. An overhauled part is one that has been completely repaired and inspected by a licensed repair facility such as ours.
A factory-new or new surplus part is one that has never been installed or used. Factory-new parts are purchased from FAA-approved manufacturers (such as HEICO or OEMs) or their authorized distributors. New surplus parts are purchased from excess stock of airlines, repair facilities or other redistributors.
An aircraft spare part is classified as “repairable” if it can be repaired by a licensed repair facility under applicable regulations.
An overhauled part is one that has been completely repaired and inspected by a licensed repair facility such as ours. An aircraft spare part is classified as “repairable” if it can be repaired by a licensed repair facility under applicable regulations.
In particular, OSHA provides special procedures and measures for the handling of certain hazardous and toxic substances. In addition, specific safety standards have been promulgated for workplaces engaged in the treatment, disposal or storage of hazardous waste. Requirements under state law, in some circumstances, may mandate additional measures for facilities handling materials specified as extremely dangerous.
In addition, specific safety standards have been promulgated for workplaces engaged in the treatment, disposal or storage of hazardous waste. Requirements under state law, in some circumstances, may mandate additional measures for facilities handling materials specified as extremely dangerous. We believe that our operations are in material compliance with OSHA’s health and safety requirements.
Mendelson 59 Co-President and Director; President and Chief Executive Officer of the HEICO Flight Support Group 1992 Victor H. Mendelson 57 Co-President and Director; President and Chief Executive Officer of the HEICO Electronic Technologies Group 1996 Thomas S. Irwin 78 Senior Executive Vice President — Carlos L.
Mendelson 60 Co-Chariman of the Board; Co-Chief Executive Officer, and Director; President and Chief Executive Officer of the HEICO Flight Support Group 1992 Victor H. Mendelson 58 Co-Chairman of the Board; Co-Chief Executive Officer, and Director; President and Chief Executive Officer of the HEICO Electronic Technologies Group 1996 Carlos L.
The following table sets forth the names, ages of, and positions and offices held by our executive officers as of December 18, 2024: Name Age Position(s) Director Since Laurans A. Mendelson 86 Chairman of the Board; Chief Executive Officer; and Director 1989 Eric A.
Information About Our Executive Officers Our executive officers are appointed by the Board of Directors and serve at the discretion of the Board. The following table sets forth the names, ages of, and positions and offices held by our executive officers as of December 19, 2025: Name Age Position(s) Director Since Eric A.
Compensation and Benefits As part of our compensation philosophy, we believe that offering and maintaining market competitive total rewards programs is essential to attract and retain superior talent.
Personal protective equipment is provided to those employees where needed for the employee to safely perform their job function. 14 Index Compensation and Benefits As part of our compensation philosophy, we believe that offering and maintaining market competitive total rewards programs is essential to attract and retain superior talent.
Mendelson is a member of the Board of Directors of Partnership for Miami, a member of the Advisory Board of Trustees of Mount Sinai Medical Center in Miami Beach, Florida, a Past Chairman of Ransom Everglades 16 Index School in Coconut Grove, Florida, as well as a member of the Board of Visitors of Columbia College in New York City.
In addition, he serves on the Board of Directors of Partnership for Miami, the Advisory Board of Trustees of Mount Sinai Medical Center in Miami Beach, Florida, and is a Past Chairman of Ransom Everglades School in Coconut Grove, Florida. Eric Mendelson is the brother of Victor Mendelson. Victor H.
We recruit the best people for the job regardless of gender, ethnicity or other protected traits and it is our policy to fully comply with all laws (domestic and foreign) applicable to discrimination in the workplace. Our diversity and inclusion principles are also reflected in our employee training and policies. Available Information Our Internet website address is https://www.heico.com.
Diversity and Inclusion We are committed to maintaining a diverse and inclusive work environment that supports our global workforce and the communities we serve. We recruit the best people for the job regardless of gender, ethnicity or other protected traits and it is our policy to fully comply with all laws (domestic and foreign) applicable to discrimination in the workplace.
Mendelson has served as our Co-President since October 2009 and served as our Executive Vice President from 2001 through September 2009. Mr. Mendelson has also served as President and Chief Executive Officer of the HEICO Flight Support Group since its formation in 1993, as well as President of various Flight Support Group subsidiaries. Mr.
Mendelson has also served as President and Chief Executive Officer of the HEICO Flight Support Group since its formation in 1993, as well as President of various Flight Support Group subsidiaries. He is a co-founder and, since 1987, has been Managing Director of Mendelson International Corporation, a private investment company that is a shareholder of HEICO. Mr.
Eric Mendelson is the son of Laurans Mendelson and the brother of Victor Mendelson. Victor H. Mendelson has been associated with the Company since 1990, serving in various capacities. Mr. Mendelson has served as our Co-President since October 2009 and served as our Executive Vice President from 2001 through September 2009. Mr.
Mendelson has been associated with the Company since 1990, serving in a variety of leadership roles. He has served as our Co-Chief Executive Officer since May 2025 and as Co-Chairman of the Board since September 2025. Previously, Mr. Mendelson served as Co-President from October 2009 to April 2025 and as Executive Vice President from 2001 to September 2009. Mr.
We provide our employees upfront and ongoing safety training to ensure that safety policies and procedures are effectively communicated and implemented. Personal protective equipment is provided to those employees where needed for the employee to safely perform their job function.
We provide our employees with upfront and ongoing safety training to ensure that safety policies and procedures are effectively communicated and implemented.
Macau is a Certified Public Accountant, a Chartered Global Management Accountant, and a member of the American and Florida Institutes of Certified Public Accountants. Steven M. Walker has served as our Chief Accounting Officer since June 2012 and served as our Corporate Controller from 2002 through May 2012. He has also served as our Assistant Treasurer since 2002. Mr.
Macau is a current member of the Mount Sinai Founders of Mount Sinai Medical Center in Miami Beach, Florida. Mr. Macau is a Certified Public Accountant, a Chartered Global Management Accountant, and a member of the American and Florida Institutes of Certified Public Accountants. Bradley K. Rowen has served as our Chief Accounting Officer since February 2025. Mr.
Macau joined HEICO from the international public accounting firm of Deloitte & Touche LLP where he worked from 2000 to 2012 as an Audit Partner. Prior to joining HEICO, Mr. Macau accumulated 22 years of financial and accounting experience serving a number of public and private manufacturing and service clients in a broad range of industries.
Macau accumulated 22 years of financial and accounting experience serving a number of public and private manufacturing and service clients in a broad range of industries. His client responsibilities included serving as HEICO's lead client services partner for five years (2006 to 2010). Mr.
Other Regulation We are also subject to a variety of other regulations including work-related and community safety laws. The Occupational Safety and Health Act of 1970 mandates general requirements for safe workplaces for all employees and established the Occupational Safety and Health Administration (“OSHA”) in the Department of Labor.
The Occupational Safety and Health Act of 1970 mandates general requirements for safe workplaces for all employees and established the Occupational Safety and Health Administration (“OSHA”) in the Department of Labor. In particular, OSHA provides special procedures and measures for the handling of certain hazardous and toxic substances.
He is a member of the American and North Carolina Institutes of Certified Public Accountants. Carlos L. Macau, Jr. has served as our Executive Vice President - Chief Financial Officer and Treasurer since June 2012. Mr.
Victor Mendelson is the brother of Eric Mendelson. Carlos L. Macau, Jr. has served as our Executive Vice President - Chief Financial Officer and Treasurer since June 2012. Mr. Macau joined HEICO from the international public accounting firm of Deloitte & Touche LLP where he worked from 2000 to 2012 as an Audit Partner. Prior to joining HEICO, Mr.
He has also served as our Chief Executive Officer since February 1990 and served as our President from September 1991 through September 2009. Mr.
He has served as our Co-Chief Executive Officer since May 2025 and as Co-Chairman of the Board since September 2025. Previously, Mr. Mendelson served as Co-President from October 2009 to April 2025 and as Executive Vice President from 2001 to September 2009. Mr.
Macau, Jr. 57 Executive Vice President - Chief Financial Officer and Treasurer — Steven M. Walker 60 Chief Accounting Officer and Assistant Treasurer — Laurans A. Mendelson has served as our Chairman of the Board since December 1990.
Macau, Jr. 58 Executive Vice President - Chief Financial Officer and Treasurer — Bradley K. Rowen 44 Chief Accounting Officer and Assistant Treasurer — Eric A. Mendelson has been associated with the Company since 1990, serving in a variety of leadership roles.
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Additionally, certain team member are granted stock options, further aligning their success with HEICO's growth. 14 Index Diversity and Inclusion We are committed to remaining a diverse and inclusive work environment that supports our global workforce and the communities we serve.
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While certain of our raw materials are subject to global market price fluctuations and international trade regulations, including tariffs, such measures have not had, and are not currently expected to have a material impact on our business or results of operations.
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Also located on the website are our Corporate Governance Guidelines, Finance/Audit Committee Charter, Nominating & Corporate Governance Committee Charter, and Compensation Committee Charter.
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Trade Compliance Our operations involve products and technologies subject to U.S. and international trade control laws, including the International Traffic in Arms Regulations (ITAR), the Export Administration Regulations (EAR), and economic sanctions administered by the Office of Foreign Assets Control (OFAC).
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Mendelson is a former Chairman and present member of the Board of Trustees, former Chairman and present member of the Executive Committee and a current member of the Society of Mount Sinai Founders of Mount Sinai Medical Center in Miami Beach, Florida. In addition, Mr.
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These laws regulate the export, re-export, and transfer of certain items, technical data, software, and services, and may require us to obtain licenses or other governmental authorizations. We maintain compliance programs that include screening, training, and documentation procedures, and similar requirements apply in other jurisdictions where we operate.
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Mendelson is a Trustee Emeritus of Columbia University in the City of New York, where he previously served as Trustee and Chairman of the Trustees’ Audit Committee. Mr. Mendelson was awarded the honor of Chevalier in France’s Légion d'honneur. Mr.
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We believe we are in material compliance with applicable trade laws and regulations. There has been no material adverse effect on our consolidated financial statements nor competitive positions as a result of these trade compliance regulations. 13 Index Other Regulation We are also subject to a variety of other regulations including work-related and community safety laws.
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Mendelson was previously named Best CEO in the Aerospace & Defense Electronics Sector by Institutional Investor magazine and recently received the Ultimate CEO Award from the South Florida Business Journal . Early in his career, Mr.
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Additionally, certain team member are granted stock options, further aligning their success with HEICO's growth, some of which are subject to performance conditions as described in Note 11, Share-Based Compensation, of the Notes to the Consolidated Financial Statements.
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Mendelson was a licensed and practicing Certified Public Accountant in the states of Florida and New York, though he no longer practices and his license is inactive. Laurans Mendelson is the father of Eric Mendelson and Victor Mendelson. Eric A. Mendelson has been associated with the Company since 1990, serving in various capacities. Mr.
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Our diversity and inclusion principles are also reflected in our employee training and policies. Available Information Our Internet website address is https://www.heico.com.
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Mendelson is a co-founder, and, since 1987, has been Managing Director of Mendelson International Corporation, a private investment company, which is a shareholder of HEICO.
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Rowen has been with the Company since May 2011. Previously, he served as Senior Director of Corporate Accounting and Finance from 2018 to February 2025 and as Assistant Corporate Controller and Director of Financial Reporting from 2011 to 2018. Prior to joining the Company, Mr.
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Victor Mendelson is the son of Laurans Mendelson and the brother of Eric Mendelson. Thomas S.
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Rowen was employed by the international public accounting firm of PricewaterhouseCoopers LLP, where he worked for six years. Mr. Rowen is a Certified Public Accountant and a member of the American and Florida Institutes of Certified Public Accountants.
Removed
Irwin has served as our Senior Executive Vice President since June 2012; our Executive Vice President, Chief Financial Officer and Treasurer from September 1991 through May 2012; Senior Vice President and Treasurer from 1986 to 1991; and our Vice President and Treasurer from 1982 to 1986. Mr. Irwin is a Certified Public Accountant.
Removed
His client responsibilities included serving as HEICO's lead client services partner for five years (2006 to 2010). Mr. Macau is a current member of the Mount Sinai Founders of Mount Sinai Medical Center in Miami Beach, Florida. Mr.
Removed
Walker is a Certified Public Accountant and a member of the American Institute of Certified Public Accountants. 17 Index

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

35 edited+11 added−6 removed39 unchanged
Biggest changeOur future effective tax rate may be adversely affected by a number of factors, including the following: • Changes in statutory tax rates in any of the various jurisdictions where we file tax returns; • Changes in available tax credits or tax deductions; • Changes in tax laws or the interpretation of such tax laws including interpretations, amendments and technical corrections of the Tax Cuts and Jobs Act; 25 Index • Changes to the accounting for income taxes in accordance with generally accepted accounting principles; • The amount of net income attributable to noncontrolling interests in our subsidiaries structured as partnerships; • Changes in the mix of earnings in jurisdictions with differing statutory tax rates; • Adjustments to estimated taxes upon finalization of various tax returns; • Resolution of issues arising from tax audits with various tax authorities; • The reversal of any previously experienced tax-exempt unrealized gains in the cash surrender values of life insurance policies related to the HEICO Corporation Leadership Compensation Plan, a nonqualified deferred compensation plan; and • The Organization of Economic Cooperation and Development (OECD) has issued Pillar Two model rules to ensure large corporations pay a global minimum tax of 15%, which will begin to be effective for our operations in fiscal 2025.
Biggest changeThe Act did not have a significant impact on our fiscal 2025 consolidated financial statements and we 25 Index will continue to evaluate its potential impact on our future consolidated financial statements; • Changes to the accounting for income taxes in accordance with generally accepted accounting principles; • The amount of net income attributable to noncontrolling interests in our subsidiaries structured as partnerships; • Changes in the mix of earnings in jurisdictions with differing statutory tax rates; • Adjustments to estimated taxes upon finalization of various tax returns; • Resolution of issues arising from tax audits with various tax authorities; • The reversal of any previously recognized tax-exempt unrealized gains in the cash surrender values of life insurance policies related to the HEICO Corporation Leadership Compensation Plan, a nonqualified deferred compensation plan; and • The Organization for Economic Co-operation and Development’s (“OECD”) global minimum tax framework (“Pillar Two”), which establishes a 15% minimum effective tax rate for large multinational enterprises, became effective for our operations in fiscal 2025.
Technological development poses a number of challenges and risks, including the following: • We may not be able to successfully protect the proprietary interests we have in various aircraft parts, electronic and electro-optical equipment and our repair processes; • As OEMs continue to develop and improve jet engines and aircraft components, we may not be able to re-design and manufacture replacement parts that perform as well as those offered by OEMs or we may not be able to profitably sell our replacement parts at lower prices than the OEMs; • We may need to expend significant capital to: - purchase new equipment and machines, - train employees in new methods of production and service, and - fund the research and development of new products; and • Development by our competitors of patents or methodologies that preclude us from the design and manufacture of aircraft replacement parts or electrical and electro-optical equipment could adversely affect our business, financial condition and results of operations.
Technological development poses a number of challenges and risks, including the following: • We may not be able to successfully protect the proprietary interests we have in various aircraft parts, electronic and electro-optical equipment and our repair processes; • As OEMs continue to develop and improve jet engines and aircraft components, we may not be able to re-design and manufacture replacement parts that perform as well as those offered by OEMs or we may not be able to profitably sell our replacement parts at lower prices than the OEMs; • We may need to expend significant capital to: - purchase new equipment and machines, - train employees in new methods of production and service, and - fund the research and development of new products; and • Development by our competitors of patents or methodologies that preclude us from the design and manufacture of aircraft replacement parts or electrical and electro-optical 18 Index equipment could adversely affect our business, financial condition and results of operations.
Our acquisition strategy is affected by and poses a number of challenges and risks, including the following: • Availability of suitable acquisition candidates; • Availability of capital; • Diversion of management’s attention; • Effective integration of the operations and personnel of acquired companies; • Potential write-downs of acquired intangible assets; • Potential loss of key employees of acquired companies; • Use of a significant portion of our available cash; • Significant dilution to our shareholders for acquisitions made utilizing our securities; • Consummation of acquisitions on satisfactory terms; and • Obtaining applicable domestic and/or foreign governmental approvals such as antitrust and foreign investment related authorizations.
Our acquisition strategy is affected by and poses a number of challenges and risks, including the following: • Availability of suitable acquisition candidates; 17 Index • Availability of capital; • Diversion of management’s attention; • Effective integration of the operations and personnel of acquired companies; • Potential write-downs of acquired intangible assets; • Potential loss of key employees of acquired companies; • Use of a significant portion of our available cash; • Significant dilution to our shareholders for acquisitions made utilizing our securities; • Consummation of acquisitions on satisfactory terms; and • Obtaining applicable domestic and/or foreign governmental approvals such as antitrust and foreign investment related authorizations.
Our inability to fill our supply needs could jeopardize our ability to fulfill obligations under customer contracts, which could result in reduced revenues and profits, contract penalties or terminations, and damage to customer relationships.
Our inability to fill our supply needs could jeopardize our ability to fulfill obligations under customer contracts, which could result in reduced revenues and profits, contract penalties or terminations, and damage to customer relationships and reputation.
Should insurance or other risk transfer mechanisms, such as our existing disaster recovery and business continuity plans, be insufficient to recover all costs, we could experience a material adverse effect on our business, financial condition and results of operations. We are subject to the risks associated with sales to foreign customers, which could harm our business.
Should insurance or other risk transfer mechanisms, such as our existing disaster recovery and business continuity plans, be insufficient to recover all costs, we could experience a material adverse effect on our business, financial condition and results of operations. 20 Index We are subject to the risks associated with sales to foreign customers, which could harm our business.
We may not be able to continue to compete effectively against present or future competitors, and competitive pressures may have a material adverse effect on our business, financial condition and results of operations. The inability to obtain certain components and raw materials from suppliers could harm our business.
We may not be able to continue to compete effectively 19 Index against present or future competitors, and competitive pressures may have a material adverse effect on our business, financial condition and results of operations. The inability to obtain certain components and raw materials from suppliers could harm our business.
The loss of the services of any of our executive officers or other key employees or our inability to continue to attract or retain the necessary personnel could have a material adverse effect on our business, financial condition and results of operations. Our executive officers and directors have significant influence over our management and direction.
The loss of the services of any of our executive officers or other key employees or our inability to continue to attract or retain the necessary personnel could have a material adverse effect on our business, financial condition and results of operations. 22 Index Our executive officers and directors have significant influence over our management and direction.
Although management believes that our operations and facilities are in material compliance with 26 Index environmental laws and regulations, future changes in them or interpretations thereof or the nature of our operations may require us to make significant additional capital expenditures to ensure compliance in the future.
Although management believes that our operations and facilities are in material compliance with environmental laws and regulations, future changes in them or interpretations thereof or the nature of our operations may require us to make significant additional capital expenditures to ensure compliance in the future.
Technical employees are also critical to our research and product development, as well as our ability to continue to re-design sophisticated products of OEMs in order to sell competing replacement parts at substantially lower prices than those manufactured by the OEMs.
Technical employees are also a critical component of our research and product development activities, as well as our ability to continue to re-design sophisticated products of OEMs in order to sell competing replacement parts at substantially lower prices than those manufactured by the OEMs.
As of October 31, 2024 and 2023, goodwill and intangible assets, net of amortization, accounted for 62% and 64% of our total assets, respectively. We test our goodwill and intangible assets for impairment on an annual basis, or more frequently if events or changes in circumstances indicate that the carrying amount of such assets may not be fully recoverable.
As of October 31, 2025 and 2024, goodwill and intangible assets, net of amortization, accounted for 60% and 62% of our total assets, respectively. We test our goodwill and intangible assets for impairment on an annual basis, or more frequently if events or changes in circumstances indicate that the carrying amount of such assets may not be fully recoverable.
Further, increased costs of such raw materials or components could reduce our profits if we were unable to pass along such price increases to our customers. 20 Index Product specification costs and requirements could cause an increase to our costs to complete contracts.
Further, increased costs of such raw materials or components could reduce our profits if we were unable to pass along such price increases to our customers. Product specification costs and requirements could cause an increase in our costs to complete contracts.
Any such events could disrupt our operations, delay production and shipments, result in defective products or services, damage customer relationships and our reputation and result in legal claims or proceedings that could have a material adverse effect on our business, financial condition and results of operations.
Any such event could disrupt our operations, delay production and shipments, result in defective products or services, damage customer relationships and our reputation and result in 21 Index legal claims or proceedings that could have a material adverse effect on our business, financial condition and results of operations.
In addition, we may not be able to successfully develop new products, equipment or methods of repair and overhaul service, and the failure to do so could have a material adverse effect on our business, financial condition and results of operations. Intense competition from existing and new competitors may harm our business.
In addition, we may not be able to successfully develop new products, equipment or methods of repair and overhaul service, and failure to do so could have a material adverse effect on our business, financial condition and results of operations. Intense competition from existing and new competitors may harm our business. We face significant competition in each of our businesses.
As of December 18, 2024, collectively our executive officers and entities controlled by them, the HEICO Savings and Investment Plan (our 401(k) Plan) and members of the Board of Directors beneficially owned approximately 19% of our outstanding Common Stock and approximately 3% of our outstanding Class A Common Stock.
As of December 19, 2025, collectively our executive officers and entities controlled by them, the HEICO Savings and Investment Plan (our 401(k) Plan) and members of the Board of Directors beneficially owned approximately 11% of our outstanding Common Stock and approximately 3% of our outstanding Class A Common Stock.
We rely on information technology systems, some of which are managed by third parties, to process, transmit and store electronic information, and to manage or support a variety of critical business processes and activities. We also collect and store sensitive data, including confidential business information and personal data.
We rely on information technology systems, some of which are managed by third parties, to process, transmit and store electronic information, and to manage or support a variety of critical business processes and activities. We also collect and store sensitive data, including confidential business information and personal data that are subject to privacy and security laws and regulations.
We market our products and services to approximately 135 countries, with approximately 37% of our consolidated net sales in fiscal 2024 derived from sales to foreign customers. We expect that sales to foreign customers will continue to account for a significant portion of our revenues in the foreseeable future.
We market our products and services to approximately 130 countries, with approximately 38% of our consolidated net sales in fiscal 2025 derived from sales to foreign customers. We expect that sales to foreign customers will continue to account for a significant portion of our revenues in the foreseeable future.
Health Emergencies pose a risk that we or our employees, customers, suppliers, manufacturers and other commercial partners may be prevented from conducting business activities for an indefinite period of time, including due to the spread of the disease or shutdowns requested or mandated by governmental authorities.
Health Emergencies can negatively impact our supply chain, cause inflationary pressures and pose a risk that we or our employees, customers, suppliers, manufacturers and other commercial partners may be prevented from conducting business activities for an indefinite period of time, including due to the spread of the disease or shutdowns requested or mandated by governmental authorities.
Consequently, we devote substantial resources to research and 18 Index product development.
Consequently, we devote substantial resources to research and product development.
A decline in defense, space or homeland security budgets or additional restrictions imposed by the U.S. government on sales of products or services to foreign military agencies could lower sales of our products and services. We are subject to risks arising from public health threats, such as the the COVID-19 global pandemic ("Health Emergencies").
A decline in defense, space or homeland security budgets or additional restrictions imposed by the U.S. government on sales of products or services to foreign military agencies could lower sales of our products and services. We are subject to risks arising from public health threats, including global or regional health emergencies (“Health Emergencies”).
Denial of export licenses could reduce our sales to those countries and could have a material adverse effect on our business.
Additionally, the denial of export licenses could reduce our sales to certain countries and could have a material adverse effect on our business.
The extent to which Health Emergencies may have a material adverse effect on our future business, financial condition and results of operations will depend on many factors that are not within HEICO’s control, including but not limited to the path and effect of Health Emergencies, including factors like new variants and vaccination rates, potential supply chain disruptions and inflation, which can impact our key markets.
The extent to which Health Emergencies may have a material adverse effect on our future business, financial condition and results of operations will depend on many factors that are not within HEICO’s control, including but not limited to, the geographic location and the rate of spread and path of the Health Emergency, available vaccinations and the vaccination rate, and potential supply chain disruptions and inflation, which can impact our key markets.
While the impact of these factors is difficult to predict, any one or more of these factors may have a material adverse effect on our business, financial condition and results of operations. 21 Index Cybersecurity events or other disruptions of our information technology systems could adversely affect our business.
Foreign Corrupt Practices Act; and • Transportation delays and other supply chain disruptions. While the impact of these factors is difficult to predict, any one or more of these factors may have a material adverse effect on our business, financial condition and results of operations. Cybersecurity events or other disruptions of our information technology systems could adversely affect our business.
We file income tax returns in the U.S. federal jurisdiction, multiple state jurisdictions and certain jurisdictions outside the U.S. In fiscal 2024, our effective tax rate was 17.5%.
We file income tax returns in the U.S. federal jurisdiction, multiple state jurisdictions and certain jurisdictions outside the U.S. In fiscal 2025, our effective tax rate was 16.6%.
If aircraft or engines for which we offer replacement parts or supply repair and overhaul services are retired or grounded for prolonged periods of time and there are fewer aircraft that require these parts or services, our revenues may decline as well as the value of any related inventory.
If aircraft or engines for which we offer replacement parts or supply repair and overhaul services are retired or grounded for prolonged periods of time and there are fewer aircraft that require these parts or services, our revenues may decline as well as the value of any related inventory. 23 Index Reductions in defense, space or homeland security spending by U.S. and/or foreign customers could reduce our revenues.
Flight Support Group • For jet engine and aircraft component replacement parts, we compete with the industry’s leading jet engine and aircraft component OEMs. • For the distribution, overhaul and repair of jet engine and aircraft components and avionics and navigation systems as well as the manufacture of specialty aircraft and defense related parts, we compete with: - major commercial airlines, many of which operate their own maintenance and overhaul units; - OEMs, which manufacture, distribute, repair and overhaul their own and other OEM parts; and - other independent service companies. 19 Index Electronic Technologies Group • For the design and manufacture of various types of electronic, data and microwave, and electro-optical equipment products, we compete in a fragmented marketplace with a number of companies, some of which are well capitalized.
Flight Support Group • For jet engine and aircraft component replacement parts, we compete with the industry’s leading jet engine and aircraft component OEMs. • For the distribution, overhaul and repair of jet engine and aircraft components and avionics and navigation systems as well as the manufacture of specialty aircraft and defense related parts, we compete with: - major commercial airlines, many of which operate their own maintenance and overhaul units; - OEMs, which manufacture, distribute, repair and overhaul their own and other OEM parts; and - other independent service companies.
We include, with the replacement parts that we sell to our customers, documentation certifying that each part complies with applicable regulatory requirements and meets applicable standards of airworthiness 24 Index established by the FAA or the equivalent regulatory agencies in other countries. In addition, our repair and overhaul operations are subject to certification pursuant to regulations established by the FAA.
Governmental agencies throughout the world, including the FAA, highly regulate the manufacture, repair and overhaul of aircraft parts and accessories. We include, with the replacement parts that we sell to our customers, documentation certifying that each part complies with applicable regulatory requirements and meets applicable standards of airworthiness established by the FAA or the equivalent regulatory agencies in other countries.
The supply chains for our business could also be disrupted by external events such as natural disasters, extreme weather events, pandemics, labor disputes, governmental actions and legislative or regulatory changes.
The supply chains for our business could also be disrupted by external events such as natural disasters, extreme weather events, pandemics, labor disputes, governmental actions and legislative or regulatory changes. For example, tariffs, duties or other trade policy changes affecting the import or export of raw materials or components could increase costs or limit availability.
We may not realize the full value of our goodwill and intangible assets, and to the extent that impairment has occurred, we would be required to recognize the impaired portion of such assets in our earnings. An impairment of a significant portion of such assets could have a material adverse effect on our business, financial condition and results of operations.
We may not realize the full value of our goodwill and intangible assets, and to the extent that impairment has occurred, we would be required to recognize the impaired portion of such assets as a non-cash charge to our earnings.
Pursuant to various environmental laws, a current or previous owner or operator of real property may be liable for the costs of removal or remediation of hazardous materials. Environmental laws typically impose liability whether or not the owner or operator knew of, or was responsible for, the presence of hazardous materials in the environment.
Environmental laws typically impose liability whether or not the owner or operator knew of, or was responsible for, the presence of hazardous materials in the environment.
Reductions in defense, space or homeland security spending by U.S. and/or foreign customers could reduce our revenues. In fiscal 2024, approximately 32% of our net sales were derived from the sale of defense, commercial and defense satellite and spacecraft components, and homeland security products.
In fiscal 2025, approximately 31% of our net sales were derived from the sale of defense, commercial and defense satellite and spacecraft components, and homeland security products.
Our Flight Support Group designs and manufactures jet engine and aircraft component replacement parts and also repairs, overhauls and distributes jet engine and aircraft components.
The retirement or prolonged grounding of commercial aircraft could reduce our revenues and the value of any related inventory. Our Flight Support Group designs and manufactures jet engine and aircraft component replacement parts and also repairs, overhauls and distributes jet engine and aircraft components.
Lower commercial air travel caused by risks arising from public health threats, such as the COVID-19 global pandemic, and their aftermath, airline fleet changes or airline purchasing decisions, could cause lower demand for our goods and services.
Lower commercial air travel caused by risks arising from public health threats and their aftermath, airline fleet changes or airline purchasing decisions, could cause lower demand for our goods and services. These global industry and economic conditions may have a material adverse effect on our business, financial condition and results of operations.
The OECD has issued administrative guidance and safe harbor rules around the implementation of Pillar Two. We currently do not expect Pillar Two will have a significant impact on our fiscal 2025 consolidated financial statements, but will continue to monitor the potential impact of future legislation and guidance.
The adoption of Pillar Two did not have a significant impact on our fiscal 2025 consolidated financial statements. We will continue to monitor the potential impact of future legislation and guidance and as more jurisdictions in which we conduct business implement Pillar Two legislation.
Specific regulations vary from country to country, although compliance with FAA requirements generally satisfies regulatory requirements in other countries. The revocation or suspension of any of our material authorizations or approvals would have an adverse effect on our business, financial condition and results of operations.
The revocation or suspension of any of our material authorizations or approvals would have an adverse effect on our business, financial condition and results of operations. New and more stringent government regulations, if adopted and enacted, could have an adverse effect on our business, financial condition and results of operations.
We are dependent on key personnel and the loss of these key personnel could have a material adverse effect on our success. Our success substantially depends on the performance, contributions and expertise of our senior management team led by Laurans A. Mendelson, our Chairman and Chief Executive 22 Index Officer, and Eric A. Mendelson and Victor H. Mendelson, our Co-Presidents.
Our success substantially depends on the performance, contributions and expertise of our senior management team led by Eric A. Mendelson and Victor H. Mendelson, our Co-Chairmen and Co-Chief Executive Officers, and Carlos L. Macau, Jr., our Chief Financial Officer. Because many of our products are highly engineered, we depend on our experienced, educated and trained team members.
Removed
We face significant competition in each of our businesses.
Added
Electronic Technologies Group • For the design and manufacture of various types of electronic, data and microwave, and electro-optical equipment products, we compete in a fragmented marketplace with a number of companies, some of which are well capitalized.
Removed
Foreign Corrupt Practices Act; and • Transportation delays and other supply chain disruptions.
Added
Certain of our businesses that perform work for the U.S. Department of Defense are also required to comply with applicable cybersecurity standards, including the Department of Defense’s Cybersecurity Maturity Model Certification (“CMMC”) program.
Removed
These global industry and economic conditions may have a material adverse effect on our business, financial condition and results of operations. 23 Index The retirement or prolonged grounding of commercial aircraft could reduce our revenues and the value of any related inventory.
Added
CMMC requirements may change over time and could impose additional compliance obligations on us and our suppliers, and failure to meet applicable CMMC requirements could affect our ability to receive or perform certain defense-related contracts.
Removed
Our results of operations may continue to reflect the adverse impact from the COVID-19 pandemic, including its impact on our supply chain and inflationary pressures.
Added
We continue to monitor evolving data-privacy requirements and the use of emerging technologies, such as artificial intelligence, and maintain policies intended to promote their secure and responsible use.
Removed
Governmental agencies throughout the world, including the FAA, highly regulate the manufacture, repair and overhaul of aircraft parts and accessories.
Added
An impairment of a significant portion of such assets could have a material adverse effect on our business, financial condition and results of operations. We are dependent on key personnel and the loss of these key personnel could have a material adverse effect on our success.
Removed
New and more stringent government regulations, if adopted and enacted, could have an adverse effect on our business, financial condition and results of operations. In addition, certain product sales to foreign countries of our Electronic Technologies Group and Flight Support Group require export approval or licensing from the United States ("U.S.") government.
Added
In addition, our repair and overhaul operations are subject to certification pursuant to regulations established by the FAA. Specific regulations vary from country to country, although compliance with FAA requirements generally satisfies regulatory requirements in other countries.
Added
Also, our operations involve products and technologies subject to U.S. and international trade control laws, including the International Traffic in Arms Regulations (ITAR), the Export Administration Regulations (EAR), and economic sanctions administered by the Office of 24 Index Foreign Assets Control (OFAC).
Added
These laws regulate the export, re-export, and transfer of certain items, technical data, software, and services, and may require us to obtain licenses or other governmental authorizations. If we are unable to comply with the applicable trade laws and regulations, it could have a material adverse effect on our consolidated financial statements and competitive positions.
Added
Our future effective tax rate may be adversely affected by a number of factors, including the following: • Changes in statutory tax rates in any of the various jurisdictions where we file tax returns; • Changes in available tax credits or deductions; • Changes in tax laws or their interpretation, including amendments, technical corrections, and guidance related to the Tax Cuts and Jobs Act as well as to H.R.1, commonly referred to as the One Big Beautiful Bill Act (the “Act”).
Added
The Act became law on July 4, 2025 and introduced significant changes to U.S. tax law. See Note 7, Income Taxes, of the Notes to Consolidated Financial Statements for further information regarding certain provisions of the Act. The Act has multiple effective dates and certain provisions became effective in fiscal 2025 while others will be phased in through fiscal 2028.
Added
We monitor evolving environmental and climate-related regulations for potential impact on our business or results of operations . Pursuant to various environmental laws, a current or previous owner or operator of real property may be liable for the costs of 26 Index removal or remediation of hazardous materials.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe proactively monitor networks for suspicious activity and collaborate with governmental and industry partners to stay informed on emerging cybersecurity risks. We also 27 Index emphasize a culture of vigilance through regular employee training that includes phishing awareness, malware prevention, and reporting protocols.
Biggest changeWe also emphasize a culture of vigilance through regular employee training that includes phishing awareness, malware prevention, and reporting protocols. Governance and Oversight Our governance and oversight framework for cybersecurity risks operates at multiple levels within the organization.
The Chief Information Officer has over 27 years of experience in cybersecurity and is responsible for designing and implementing the organization's cybersecurity strategy. The cybersecurity program and the Information Security Team are led by the Senior IT Director, who reports to the Chief Information Officer. The Senior IT Director has over 20 years of experience in cybersecurity.
The Chief Information Officer has over 28 years of experience in cybersecurity and is responsible for designing and implementing the organization's cybersecurity strategy. The cybersecurity program and the Information Security Team are led by the Senior IT Director, who reports to the Chief Information Officer. The Senior IT Director has over 21 years of experience in cybersecurity.
Governance and Oversight Our governance and oversight framework for cybersecurity risks operates at multiple levels within the organization. The Board of Directors has final oversight responsibility for cybersecurity-related matters and receives regular updates from the Chief Information Officer and senior management on the status of the cybersecurity program, vulnerability assessments, strategic initiatives, and any significant incident response activities.
The Board of Directors has final oversight responsibility for cybersecurity-related matters and receives regular updates from the Chief Information Officer and senior management on the status of the cybersecurity program, vulnerability assessments, strategic initiatives, and any significant incident response activities.
Therefore, we continuously assess and enhance our cybersecurity measures to adapt to the changing threat landscape and ensure organizational resilience. For more information about the potential impact of cybersecurity risks, please refer to Item 1A. Risk Factors. 28 Index
Therefore, we continuously assess and enhance our cybersecurity measures to adapt to the changing threat landscape and ensure organizational resilience. For more information regarding the potential impact of cybersecurity risks, please refer to the risk factor entitled “Cybersecurity events or other disruptions of our information technology systems could adversely affect our business” in Item 1A. Risk Factors. 28 Index
Insights from these assessments inform the enhancement of our security controls and help us mitigate emerging threats effectively. We also actively engage with key consultants as part of our continuing efforts to evaluate and enhance the effectiveness of our cybersecurity program.
Insights from these assessments inform the enhancement of our security controls and help us mitigate emerging threats effectively.
Added
We also actively engage with key consultants as part of our continuing efforts to evaluate and enhance the effectiveness of our cybersecurity program. 27 Index We proactively monitor networks for suspicious activity and collaborate with governmental and industry partners to stay informed on emerging cybersecurity risks.

Item 2. Properties

Properties — owned and leased real estate

3 edited+0 added−0 removed1 unchanged
Biggest changeSummary information on the facilities utilized within the FSG, ETG and our corporate offices to support their principal operating activities is as follows: Square Footage Location Leased Owned Description Flight Support Group United States facilities (18 states) 1,580,000 233,000 Manufacturing, engineering and distribution facilities, and corporate headquarters United States facilities (10 states) 652,000 127,000 Repair and overhaul facilities International facilities (10 countries) - France, Germany, India, Laos, Netherlands, Singapore, Thailand, Turkey, United Arab Emirates and United Kingdom 139,000 173,000 Manufacturing, engineering and distribution facilities, and sales offices Electronic Technologies Group United States facilities (19 states) 849,000 634,000 Manufacturing and engineering facilities International facilities (7 countries) - Canada, France, India, Morocco, South Korea, United Kingdom and Vietnam 416,000 346,000 Manufacturing and engineering facilities Corporate United States facilities (1 state) — 10,000 (1) Administrative offices (1) Represents the square footage of our corporate offices in Miami, Florida.
Biggest changeSummary information on the facilities utilized within the FSG, ETG and our corporate offices to support their principal operating activities is as follows: Square Footage Location Leased Owned Description Flight Support Group United States facilities (19 states) 1,582,000 280,000 Manufacturing, engineering and distribution facilities, and corporate headquarters United States facilities (10 states) 648,000 127,000 Repair and overhaul facilities International facilities (10 countries) - France, Germany, India, Laos, Netherlands, Singapore, Thailand, Turkey, United Arab Emirates and United Kingdom 136,000 173,000 Manufacturing, engineering and distribution facilities, and sales offices Electronic Technologies Group United States facilities (19 states) 906,000 759,000 Manufacturing and engineering facilities International facilities (7 countries) - Canada, France, India, Morocco, South Korea, United Kingdom and Vietnam 458,000 493,000 Manufacturing and engineering facilities Corporate United States facilities (1 state) — 10,000 (1) Administrative offices (1) Represents the square footage of our corporate offices in Miami, Florida.
Item 2. PROPERTIES We own or lease a number of facilities, which are utilized by our Flight Support Group (“FSG”), Electronic Technologies Group (“ETG”), and corporate offices. As of October 31, 2024, all of the facilities listed below were in good operating condition, well maintained and in regular use.
Item 2. PROPERTIES We own or lease a number of facilities, which are utilized by our Flight Support Group (“FSG”), Electronic Technologies Group (“ETG”), and corporate offices. As of October 31, 2025, all of the facilities listed below were in good operating condition, well maintained and in regular use.
The square footage of our corporate headquarters in Hollywood, Florida is included within Square Footage-Owned of the caption “United States facilities (18 states)” under Flight Support Group.
The square footage of our corporate headquarters in Hollywood, Florida is included above within Square Footage-Owned of the caption “United States facilities (19 states)” under Flight Support Group.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

7 edited+4 added−1 removed9 unchanged
Biggest changeIn July 2024, we paid our 92nd consecutive semi-annual cash dividend since 1979 of $.11 per share, which represented a 10% increase over the semiannual cash dividend of $.10 per share paid in January 2024. In December 2024, our Board of Directors declared a semi-annual cash dividend of $.11 per share payable in January 2025.
Biggest changeDividend Policy We have historically paid semi-annual cash dividends on both our Class A Common Stock and Common Stock. In July 2025, we paid our 94th consecutive semi-annual cash dividend since 1979 of $.12 per share, which represented a 9% increase over the semiannual cash dividend of $.11 per share paid in January 2025.
Performance Graphs The following graph and table compare the total return on $100 invested in HEICO Common Stock and HEICO Class A Common Stock with the total return on $100 invested in the NYSE Composite Index and the Dow Jones U.S. Aerospace Index for the five-year period from October 31, 2019 through October 31, 2024.
Performance Graphs The following graph and table compare the total return on $100 invested in HEICO Common Stock and HEICO Class A Common Stock with the total return on $100 invested in the NYSE Composite Index and the Dow Jones U.S. Aerospace Index for the five-year period from October 31, 2020 through October 31, 2025.
Aerospace Index 1,766.94 1,878.10 2,807.42 3,373.52 3,725.15 2020 2021 2022 2023 2024 HEICO Common Stock $44,877.75 $60,000.11 $65,650.39 $64,751.68 $99,188.00 NYSE Composite Index 707.40 968.47 839.31 849.11 1,094.96 Dow Jones U.S. Aerospace Index 2,233.00 3,400.98 3,147.04 3,440.63 4,731.25 Issuer Purchases of Equity Securities There were no issuer purchases of our equity securities during the fourth quarter of fiscal 2024.
Aerospace Index 1,766.94 1,878.10 2,807.42 3,373.52 3,725.15 2020 2021 2022 2023 2024 HEICO Common Stock $44,877.75 $60,000.11 $65,650.39 $64,751.68 $99,188.00 NYSE Composite Index 707.40 968.47 839.31 849.11 1,094.96 Dow Jones U.S. Aerospace Index 2,233.00 3,400.98 3,147.04 3,440.63 4,731.25 2025 HEICO Common Stock $128,481.31 NYSE Composite Index 1,221.35 Dow Jones U.S.
As of December 18, 2024, there were 247 holders of record of our Common Stock and 280 holders of record of our Class A Common Stock.
As of December 19, 2025, there were 234 holders of record of our Common Stock and 259 holders of record of our Class A Common Stock.
Aerospace Index 100.00 59.94 91.30 84.48 92.36 127.01 The following graph and table compare the total return on $100 invested in HEICO Common Stock since October 31, 1990 using the same indices shown on the five-year performance graph above.
Aerospace Index 100.00 152.31 140.93 154.08 211.88 329.22 The following graph and table compare the total return on $100 invested in HEICO Common Stock since October 31, 1990 using the same indices shown on the five-year performance graph above.
Our Board of Directors will continue to review our dividend policy and will regularly evaluate whether dividends should be paid in cash or stock, as well as what amounts should be paid. Our ability to pay dividends could be affected by future business performance, liquidity, capital needs, alternative investment opportunities and loan covenants under our revolving credit facility.
Our ability to pay dividends could be affected by future business performance, liquidity, 33 Index capital needs, alternative investment opportunities and loan covenants under our revolving credit facility. Item 6. [Reserved]
The total returns include the reinvestment of cash dividends. 30 Index Cumulative Total Return as of October 31, 2019 2020 2021 2022 2023 2024 HEICO Common Stock $100.00 $85.30 $113.33 $132.40 $129.11 $199.85 HEICO Class A Common Stock 100.00 98.32 132.35 134.27 134.29 203.09 NYSE Composite Index 100.00 94.36 129.19 111.96 113.27 146.06 Dow Jones U.S.
The total returns include the reinvestment of cash dividends. 30 Index Cumulative Total Return as of October 31, 2020 2021 2022 2023 2024 2025 HEICO Common Stock $100.00 $132.86 $155.22 $151.36 $234.29 $304.20 HEICO Class A Common Stock 100.00 134.61 136.56 136.58 206.55 266.78 NYSE Composite Index 100.00 136.91 118.65 120.03 154.79 172.65 Dow Jones U.S.
Removed
Recent Sales of Unregistered Securities There were no unregistered sales of our equity securities during fiscal 2024. Dividend Policy We have historically paid semi-annual cash dividends on both our Class A Common Stock and Common Stock.
Added
Aerospace Index 7,351.46 Issuer Purchases of Equity Securities There were no issuer purchases of our equity securities during the fourth quarter of fiscal 2025. Recent Sales of Unregistered Securities On January 31, 2025, we acquired 90% of the membership interests of Millennium International, LLC ("Millennium").
Added
The purchase price of this acquisition was principally paid in cash using proceeds from our revolving credit facility and cash provided by operating activities, as well as through the issuance of 53,186 shares of HEICO Class A Common Stock.
Added
The HEICO Class A Common Stock issued in connection with the acquisition of Millennium was not registered under the Securities Act of 1933, in accordance with Section 4(a)(2) and Rule 506(b) of Regulation D thereunder, as a transaction by an issuer not involving any public offering. See Note 2, Acquisitions, of the Notes to Consolidated Financial Statements for additional information.
Added
In December 2025, our Board of Directors declared a semi-annual cash dividend of $.12 per share payable in January 2026. Our Board of Directors will continue to review our dividend policy and will regularly evaluate whether dividends should be paid in cash or stock, as well as what amounts should be paid.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

64 edited+4 added−7 removed49 unchanged
Biggest changeA similar discussion and analysis that compares fiscal 2023 to fiscal 2022 may be found in Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our Form 10-K for the fiscal year ended October 31, 2023. 35 Index Results of Operations The following table sets forth the results of our operations, net sales and operating income by segment and the percentage of net sales represented by the respective items in our Consolidated Statements of Operations (in thousands) : Year ended October 31, 2024 2023 Net sales $3,857,669 $2,968,105 Cost of sales 2,355,943 1,814,617 Selling, general and administrative expenses 677,271 528,149 Total operating costs and expenses 3,033,214 2,342,766 Operating income $824,455 $625,339 Net sales by segment: Flight Support Group $2,639,354 $1,770,185 Electronic Technologies Group 1,263,626 1,225,222 Intersegment sales (45,311) (27,302) $3,857,669 $2,968,105 Operating income by segment: Flight Support Group $593,074 $387,297 Electronic Technologies Group 288,193 285,053 Other, primarily corporate (56,812) (47,011) $824,455 $625,339 Net sales 100.0 % 100.0 % Gross profit 38.9 % 38.9 % Selling, general and administrative expenses 17.6 % 17.8 % Operating income 21.4 % 21.1 % Interest expense (3.9 %) (2.5 %) Other income .1 % .1 % Income tax expense 3.1 % 3.7 % Net income attributable to noncontrolling interests 1.2 % 1.4 % Net income attributable to HEICO 13.3 % 13.6 % 36 Index Comparison of Fiscal 2024 to Fiscal 2023 Net Sales Our consolidated net sales in fiscal 2024 increased by 30% to a record $3,857.7 million, up from net sales of $2,968.1 million in fiscal 2023.
Biggest changeResults of Operations The following table sets forth the results of our operations, net sales and operating income by segment and the percentage of net sales represented by the respective items in our Consolidated Statements of Operations (in thousands) : Year ended October 31, 2025 2024 Net sales $4,485,044 $3,857,669 Cost of sales 2,698,580 2,355,943 Selling, general and administrative expenses 767,466 677,271 Total operating costs and expenses 3,466,046 3,033,214 Operating income $1,018,998 $824,455 Net sales by segment and intersegment: Flight Support Group $3,117,277 $2,639,354 Electronic Technologies Group 1,413,120 1,263,626 Intersegment sales (45,353) (45,311) $4,485,044 $3,857,669 Operating income by segment and corporate and other: Flight Support Group $750,395 $593,074 Electronic Technologies Group 324,952 288,193 Other, primarily corporate (56,349) (56,812) $1,018,998 $824,455 Net sales 100.0 % 100.0 % Gross profit 39.8 % 38.9 % Selling, general and administrative expenses 17.1 % 17.6 % Operating income 22.7 % 21.4 % Interest expense (2.9 %) (3.9 %) Other income .1 % .1 % Income tax expense 3.3 % 3.1 % Net income attributable to noncontrolling interests 1.2 % 1.2 % Net income attributable to HEICO 15.4 % 13.3 % 36 Index Comparison of Fiscal 2025 to Fiscal 2024 Net Sales Our consolidated net sales in fiscal 2025 increased by 16% to a record $4,485.0 million, up from net sales of $3,857.7 million in fiscal 2024.
Investing Activities Net cash used in investing activities totaled $293.2 million in fiscal 2024 and related primarily to acquisitions of $219.3 million, capital expenditures of $58.3 million, and LCP funding of $19.9 million. Further details regarding our acquisitions may be found in Note 2, Acquisitions, of the Notes to Consolidated Financial Statements.
Further details regarding our acquisitions may be found in Note 2, Acquisitions, of the Notes to Consolidated Financial Statements. Net cash used in investing activities totaled $293.2 million in fiscal 2024 and related primarily to acquisitions of $219.3 million, capital expenditures of $58.3 million, and LCP funding of $19.9 million.
The ETG collectively designs, manufactures and sells various types of electronic, data and microwave, and electro-optical 34 Index products, including infrared simulation and test equipment, laser rangefinder receivers, electrical power supplies, back-up power supplies, power conversion products, underwater locator beacons, emergency locator transmission beacons, flight deck annunciators, panels and indicators, electromagnetic and radio frequency interference shielding and filters, high power capacitor charging power supplies, amplifiers, traveling wave tube amplifiers, photodetectors, amplifier modules, microwave power modules, flash lamp drivers, laser diode drivers, arc lamp power supplies, custom power supply designs, cable assemblies, high voltage power supplies, high voltage interconnection devices and wire, high voltage energy generators, high frequency power delivery systems; memory products, including three-dimensional microelectronic and stacked memory, static random-access memory (SRAM) and electronically erasable programmable read-only memory (EEPROM); harsh environment electronic connectors and other interconnect products, RF and microwave amplifiers, transmitters, and receivers and integrated assemblies, sub-assemblies and components; RF sources, detectors and controllers, wireless cabin control systems, solid state power distribution and management systems, proprietary in-cabin power and entertainment components and subsystems, crashworthy and ballistically self-sealing auxiliary fuel systems, nuclear radiation detectors, communications and electronic intercept receivers and tuners, fuel level sensing systems, high-speed interface products that link devices, high performance active antenna systems and airborne antennas for commercial and military aircraft, precision guided munitions, other defense applications and commercial uses; silicone material for a variety of demanding applications; precision power analog monolithic, hybrid and open frame components; high-reliability ceramic-to-metal feedthroughs and connectors, technical surveillance countermeasures (TSCM) equipment to detect devices used for espionage and information theft; rugged small-form factor embedded computing solutions; custom high power filters and filter assemblies; test sockets and adapters for both engineering and production use of semiconductor devices, and radiation assurance services and products; and Hi-Rel, complex, passive electronic components and rotary joint assemblies for mostly aerospace and defense applications, in addition to other high-end applications, such as medical and energy uses including emerging "clean energy" and electrification applications.
The ETG collectively designs, manufactures and sells various types of electronic, data and microwave, and electro-optical products, including infrared simulation and test equipment, laser rangefinder receivers, electrical power supplies, back-up power supplies, power conversion products, underwater locator beacons, emergency locator transmission beacons, flight deck annunciators, panels, indicators, electromagnetic and radio frequency interference shielding and filters, high power capacitor charging power supplies, amplifiers, traveling wave tube amplifiers, photodetectors, amplifier modules, microwave power modules, flash lamp drivers, laser diode drivers, arc lamp power supplies, custom power supply designs, cable assemblies, high voltage power supplies, high voltage interconnection devices and wire, high voltage energy generators, high frequency power delivery systems; memory products, including three-dimensional microelectronic and stacked memory, static random-access memory (SRAM) and electronically erasable programmable read-only memory (EEPROM); harsh environment electronic connectors and other interconnect products, RF and microwave amplifiers, transmitters, and receivers and integrated assemblies, sub-assemblies and components; RF sources, detectors and controllers, wireless cabin control systems, solid state power distribution and management systems, proprietary in-cabin power and entertainment components and subsystems, cockpit displays and other avionics components, crashworthy and ballistically self-sealing auxiliary fuel systems, nuclear radiation detectors, communications and electronic intercept receivers and tuners, fuel level sensing systems, high-speed interface products that link devices, high performance active antenna systems and airborne antennas for commercial and military aircraft, precision guided munitions, other defense applications and commercial uses; silicone material for a variety of demanding applications; precision power analog monolithic, hybrid and open frame components; high-reliability ceramic-to-metal feedthroughs and connectors, technical surveillance countermeasures (TSCM) equipment to detect devices used for espionage and information theft; rugged small-form factor embedded computing solutions; custom high power filters and filter assemblies; test sockets and adapters for both engineering and production use of semiconductor devices; radiation assurance services and products; and Hi-Rel, complex, passive electronic components and rotary joint assemblies for mostly aerospace and defense applications, in addition to other high-end applications, such as medical and energy uses including emerging "clean energy" and electrification applications.
In addition, a subsidiary guarantor will be released and relieved from all its obligations under its subsidiary guarantee in the following circumstances, each of which is permitted by the indenture: • upon the sale or other disposition (including by way of consolidation or merger), in one transaction or a series of related transactions, of a majority of the total voting stock of such subsidiary guarantor (other than to us or any of our affiliates); or • upon the sale or disposition of all or substantially all the property of such subsidiary guarantor (other than to any of our affiliates or another subsidiary guarantor); provided, however, that, in each case, such transaction is permitted by the Credit Facility and after giving effect to such transaction, such subsidiary guarantor is no longer liable for any subsidiary guarantee or other obligations in respect of the Credit Facility.
In addition, a subsidiary guarantor will be released and relieved from all its obligations under its subsidiary guarantee in the following circumstances, each of which is permitted by the indenture: 43 Index • upon the sale or other disposition (including by way of consolidation or merger), in one transaction or a series of related transactions, of a majority of the total voting stock of such subsidiary guarantor (other than to us or any of our affiliates); or • upon the sale or disposition of all or substantially all the property of such subsidiary guarantor (other than to any of our affiliates or another subsidiary guarantor); provided, however, that, in each case, such transaction is permitted by the Credit Facility and after giving effect to such transaction, such subsidiary guarantor is no longer liable for any subsidiary guarantee or other obligations in respect of the Credit Facility.
For further information on these and other factors that potentially could materially affect our financial results, see Item 1A, Risk Factors . We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except to the extent required by applicable law. 49 Index
For further information on these and other factors that potentially could materially affect our financial results, see Item 1A, Risk Factors . We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except to the extent required by applicable law.
In July 2023, we entered into a third amendment to our Credit Facility, to, among other things, (i) increase the capacity by $500 million to $2.0 billion, (ii) extend the maturity date to July 2028, and (iii) increase the applicable rate with respect to certain total leverage ratio tiers in the pricing grid.
In July 2023, we entered into a third amendment to our Credit Facility, to, among other things, (i) increase the capacity by $500 million to $2.0 billion, (ii) extend the maturity date to July 2028, and (iii) increase the applicable rate with respect to certain total leverage ratio tiers in the pricing 41 Index grid.
The fair value of each of our reporting units calculated as part of our quantitative impairment test significantly exceeded its carrying value as of October 31, 2024. We test each non-amortizing intangible asset (principally trade names) for impairment annually as of October 31, or more frequently if events or changes in circumstances indicate that the asset might be impaired.
The fair value of each of our reporting units calculated as part of our quantitative impairment test significantly exceeded its carrying value as of October 31, 2025. We test each non-amortizing intangible asset (principally trade names) for impairment annually as of October 31, or more frequently if events or changes in circumstances indicate that the asset might be impaired.
Judgmental adjustments are often necessary to ensure comparability. The selection of the appropriate multiple within a range requires judgement, considering various qualitative and quantitative factors. Changes in assumptions or estimates could materially affect the estimated fair value of our reporting units and the potential for impairment.
Judgmental adjustments are often necessary to ensure comparability. The selection of the appropriate multiple within a range requires judgment, considering various qualitative and quantitative factors. Changes in assumptions or estimates could materially affect the estimated fair value of our reporting units and the potential for impairment.
A fee is charged on the amount of the unused commitment ranging from .15% to .35% (depending on the Company’s 42 Index Total Leverage Ratio). The Credit Facility also includes a $200 million sublimit for swingline borrowings and $100 million sublimits for borrowings made in foreign currencies and for letters of credit.
A fee is charged on the amount of the unused commitment ranging from .15% to .35% (depending on the Company’s Total Leverage Ratio). The Credit Facility also includes a $200 million sublimit for swingline borrowings and $100 million sublimits for borrowings made in foreign currencies and for letters of credit.
The Credit Facility is unsecured and contains covenants that require, among other things, the maintenance of a Total Leverage Ratio and an Interest Coverage Ratio, as such capitalized terms are defined in the Credit Facility. We were in compliance with all financial and nonfinancial covenants of the Credit Facility as of October 31, 2024.
The Credit Facility is unsecured and contains covenants that require, among other things, the maintenance of a Total Leverage Ratio and an Interest Coverage Ratio, as such capitalized terms are defined in the Credit Facility. We were in compliance with all financial and nonfinancial covenants of the Credit Facility as of October 31, 2025.
Factors that could cause such differences include: • The severity, magnitude and duration of public health threats, such as the COVID-19 pandemic; • Our liquidity and the amount and timing of cash generation; • Lower commercial air travel, airline fleet changes or airline purchasing decisions, which could cause lower demand for our goods and services; • Product specification costs and requirements, which could cause an increase to our costs to complete contracts; • Governmental and regulatory demands, export policies and restrictions, reductions in defense, space or homeland security spending by U.S. and/or foreign customers or competition from existing and new competitors, which could reduce our sales; • Our ability to introduce new products and services at profitable pricing levels, which could reduce our sales or sales growth; • Product development or manufacturing difficulties, which could increase our product development and manufacturing costs and delay sales; • Cybersecurity events or other disruptions of our information technology systems could adversely affect our business; and • Our ability to make acquisitions, including obtaining any applicable domestic and/or foreign governmental approvals, and achieve operating synergies from acquired businesses; customer credit risk; interest, foreign currency exchange and income tax rates; and economic conditions, including the effects of inflation, within and outside of the aviation, defense, space, medical, telecommunications and electronics industries, which could negatively impact our costs and revenues.
Factors that could cause such differences include, among others: • The severity, magnitude and duration of public health threats; • Our liquidity and the amount and timing of cash generation; • Lower commercial air travel, airline fleet changes or airline purchasing decisions, which could cause lower demand for our goods and services; • Product specification costs and requirements, which could cause an increase in our costs to complete contracts; • Governmental and regulatory demands, export policies and restrictions, reductions in defense, space or homeland security spending by U.S. and/or foreign customers or competition from existing and new competitors, which could reduce our sales; • Our ability to introduce new products and services at profitable pricing levels, which could reduce our sales or sales growth; • Product development or manufacturing difficulties, which could increase our product development and manufacturing costs and delay sales; 48 Index • Cybersecurity events or other disruptions of our information technology systems could adversely affect our business; and • Our ability to make acquisitions, including obtaining any applicable domestic and/or foreign governmental approvals, and achieve operating synergies from acquired businesses; customer credit risk; interest, foreign currency exchange and income tax rates; and economic conditions, including the effects of inflation, within and outside of the aviation, defense, space, medical, telecommunications and electronics industries, which could negatively impact our costs and revenues.
Also, forward-looking statements are based upon management’s estimates of fair values and of future 48 Index costs, using currently available information. Therefore, actual results may differ materially from those expressed in or implied by those forward-looking statements.
Also, forward-looking statements are based upon management’s estimates of fair values and of future costs, using currently available information. Therefore, actual results may differ materially from those expressed in or implied by those forward-looking statements.
See Note 13, Redeemable Noncontrolling Interests, of the Notes to Consolidated Financial Statements for further information. See Note 5, Short-Term and Long-Term Debt, of the Notes to Consolidated Financial Statements for information regarding our long-term debt obligations. See Note 8, Fair Value Measurements, of the Notes to Consolidated Financial Statements for information pertaining to contingent consideration obligations.
See Note 13, Redeemable Noncontrolling Interests, of the Notes to Consolidated Financial Statements for further information. See Note 5, Long-Term Debt, of the Notes to Consolidated Financial Statements for information regarding our long-term debt obligations. See Note 8, Fair Value Measurements, of the Notes to Consolidated Financial Statements for information pertaining to contingent consideration obligations.
See Note 8, Fair Value Measurements, for additional information regarding the Company’s fiscal 2024 impairment loss. New Accounting Pronouncements See Note 1, Summary of Significant Accounting Policies - New Accounting Pronouncements, of the Notes to Consolidated Financial Statements for additional information.
See Note 8, Fair Value Measurements, for additional information regarding the Company’s fiscal 2024 impairment loss. 47 Index New Accounting Pronouncements See Note 1, Summary of Significant Accounting Policies - New Accounting Pronouncements, of the Notes to Consolidated Financial Statements for additional information.
Operating Activities Net cash provided by operating activities was $672.4 million in fiscal 2024 and consisted primarily of net income from consolidated operations of $559.1 million, depreciation and amortization expense of $175.3 million (a non-cash item), net changes of $53.5 million included in the "Other" caption (principally the receipt of advance deposits on certain long-term customer contracts), net changes in other long-term liabilities and assets related to the HEICO Corporation Leadership Compensation Plan (the "LCP") of $21.6 million (principally participant deferrals and employer contributions), and $7.5 million of intangible asset impairment expense (a non- 40 Index cash item), partially offset by a $143.0 million increase in net working capital.
Net cash provided by operating activities was $672.4 million in fiscal 2024 and consisted primarily of net income from consolidated operations of $559.1 million, depreciation and amortization expense of $175.3 million (a non-cash item), net changes of $53.5 million included in the "Other" caption (principally the receipt of advance deposits on certain long-term customer contracts), net changes in other long-term liabilities and assets related to the LCP of $21.6 million (principally participant deferrals and employer contributions), and $7.5 million of intangible asset impairment expense (a non-cash item), partially offset by a $143.0 million 40 Index increase in net working capital.
The subsidiary guarantee of a subsidiary guarantor also will be released if we exercise our legal defeasance, covenant defeasance option or discharge the Indenture. 44 Index We conduct our operations almost entirely through our subsidiaries.
The subsidiary guarantee of a subsidiary guarantor also will be released if we exercise our legal defeasance, covenant defeasance option or discharge the Indenture. We conduct our operations almost entirely through our subsidiaries.
Based on the intangible impairment tests conducted, we recognized an aggregate impairment loss of $7.5 million during fiscal 2024, an immaterial impairment loss in fiscal 2023 and no impairment loss in fiscal 2022.
Based on the intangible impairment tests conducted, we recognized no impairment loss in fiscal 2025, an aggregate impairment loss of $7.5 million during fiscal 2024, and an immaterial impairment loss in fiscal 2023.
The discount rate utilized for each reporting unit is indicative of the return an investor would expect to receive for investing in such a business. Based on the annual goodwill impairment test as of October 31, 47 Index 2024, 2023 and 2022, we determined there was no impairment of our goodwill.
The discount rate utilized for each reporting unit is indicative of the return an investor would expect to receive for investing in such a business. Based on the annual goodwill impairment test as of October 31, 2025, 2024 and 2023, we determined there was no impairment of our goodwill.
As of the acquisition date, contingent consideration is recorded at fair value as determined through the use of a probability-based scenario analysis approach. Under 46 Index this method, a set of discrete potential future subsidiary earnings is determined using internal estimates based on various revenue growth rate assumptions for each scenario.
As of the acquisition date, contingent consideration is recorded at fair value as determined using a probability-based scenario analysis approach. Under this method, a set of discrete potential future subsidiary earnings is determined using internal estimates based on various revenue growth rate assumptions for each scenario.
Sales price changes were not a significant contributing factor to the change in net sales of the FSG and ETG in fiscal 2024.
Sales price changes were not a significant contributing factor to the change in net sales of the FSG and ETG in fiscal 2025.
During fiscal 2024, 2023 and 2022, such fair value measurement adjustments resulted in net decreases to SG&A expenses of ($9.9) million, ($.7) million and ($7.6) million, respectively. For further information regarding our contingent consideration arrangements, see Note 8, Fair Value Measurements, of the Notes to Consolidated Financial Statements.
During fiscal 2025, 2024 and 2023, such fair value measurement adjustments resulted in net increases (decreases) to SG&A expenses of $12.9 million, ($9.9) million and ($.7) million, respectively. For further information regarding our contingent consideration arrangements, see Note 8, Fair Value Measurements, of the Notes to Consolidated Financial Statements.
Changes in either the revenue growth rates, related earnings or the discount rate could result in a material change to the amount of contingent consideration accrued. As of October 31, 2024 and 2023, $30.2 million and $71.1 million of contingent consideration was accrued within our Consolidated Balance Sheets, respectively.
Changes in either the revenue growth rates, related earnings or the discount rate could result in a material change to the amount of contingent consideration accrued. As of October 31, 2025 and 2024, $46.2 million and $30.2 million of contingent consideration was accrued within our Consolidated Balance Sheets, respectively.
(“HEICO Electronic”) and its subsidiaries, which primarily: • Designs and Manufactures Electronic, Microwave, Electro-Optical and Other Power Equipment, High-Speed Interface Products, High Voltage Interconnection Devices, EMI and RFI Shielding and Filters, High Voltage Advanced Power Electronics, Power Conversion Products, Underwater Locator Beacons, Memory Products, Self-Sealing Auxiliary Fuel Systems, Active Antenna Systems, Airborne Antennas, TSCM Equipment and High Reliability ("Hi-Rel") Electronic Components.
(“HEICO Electronic”) and its subsidiaries, which primarily: • Designs and Manufactures Electronic, Microwave, Electro-Optical and Other Power Equipment, High-Speed Interface Products, High Voltage Interconnection Devices, EMI 34 Index and RFI Shielding and Filters, High Voltage Advanced Power Electronics, Power Conversion Products, Underwater Locator Beacons, Memory Products, Self-Sealing Auxiliary Fuel Systems, Active Antenna Systems, Airborne Antennas, TSCM Equipment, High Reliability ("Hi-Rel") Electronic Components, In-Flight Entertainment Products, and Cockpit displays and Other Avionics Components.
As of October 31, 2024, management’s estimate of the aggregate Redemption Amount of all Put Rights that we could be required to pay is approximately $366.2 million, which is included within redeemable noncontrolling interests in our Consolidated Balance Sheet.
As of October 31, 2025, management’s estimate of the aggregate Redemption Amount of all Put Rights that we could be required to pay is approximately $467.4 million, which is included within redeemable noncontrolling interests in our Consolidated Balance Sheet.
Net income attributable to noncontrolling interests was $45.0 million in fiscal 2024, as compared to $40.8 million in fiscal 2023. The increase in net income attributable to noncontrolling interests principally reflects improved operating results of certain subsidiaries of the FSG and ETG in which noncontrolling interests are held.
Net income attributable to noncontrolling interests was $55.2 million in fiscal 2025, as compared to $45.0 million in fiscal 2024. The increase in net income attributable to noncontrolling interests principally reflects improved operating results of certain subsidiaries of the FSG and ETG in which noncontrolling interests are held.
As of October 31, 2024, the estimated fair value of contingent consideration payable in fiscal 2025 was $8.4 million. 43 Index See Note 9, Leases, of the Notes to Consolidated Financial Statements for information pertaining to future minimum lease payments relating to the Company’s operating and finance lease obligations.
As of October 31, 2025, none of the estimated fair value of contingent consideration was payable in fiscal 2026. See Note 9, Leases, of the Notes to Consolidated Financial Statements for information pertaining to future minimum lease payments relating to the Company’s operating and finance lease obligations.
Our net sales in fiscal 2024 and 2023 by market consisted of approximately 56% and 48% from the commercial aviation industry, respectively, 32% and 35% from the defense and space industries, respectively, and 12% and 17% from other industrial markets including electronics, medical and telecommunications, respectively.
Our net sales in fiscal 2025 and 2024 by market consisted of approximately 58% and 56% from the commercial aviation industry, respectively, 31% and 32% from the defense and space industries, respectively, and 11% and 12% from other industrial markets including electronics, medical and telecommunications, respectively.
Total new product research and development expenses included within our consolidated cost of sales were $111.3 million in fiscal 2024, up from $95.8 million in fiscal 2023. Our consolidated selling, general and administrative ("SG&A") expenses were $677.3 million in fiscal 2024, as compared to $528.1 million in fiscal 2023.
Total new product research and development expenses included within our consolidated cost of sales were $120.9 million in fiscal 2025, up from $111.3 million in fiscal 2024. Our consolidated selling, general and administrative ("SG&A") expenses were $767.5 million in fiscal 2025, as compared to $677.3 million in fiscal 2024.
Capital expenditures in fiscal 2025 are anticipated to be approximately $65 to $70 million. We finance our activities primarily from our operating and financing activities, including borrowings under our revolving credit facility. As of December 18, 2024, we had approximately $995 million of unused committed availability under the terms of our revolving credit facility.
Capital expenditures in fiscal 2026 are anticipated to be approximately $80 to $90 million. We finance our activities primarily from our operating and financing activities, including borrowings under our revolving credit facility. As of December 19, 2025, we had approximately $1,078 million of unused committed availability under the terms of our revolving credit facility.
Our consolidated SG&A expenses as a percentage of net sales decreased to 17.6% in fiscal 2024, down from 17.8% in fiscal 2023.
Our consolidated SG&A expenses as a percentage of net sales improved to 17.1% in fiscal 2025, down from 17.6% in fiscal 2024.
The estimated aggregate Redemption Amount of the Put Rights that are currently puttable, previously put, or becoming puttable during fiscal 2025 is approximately $194.2 million, of which approximately $91.0 million would be payable in fiscal 2025 should all of the eligible associated noncontrolling interest holders elect to exercise their Put Rights during fiscal 2025.
The estimated aggregate Redemption Amount of the Put Rights that are currently puttable, previously put, or becoming 42 Index puttable during fiscal 2026 is approximately $191.4 million, of which approximately $94.6 million would be payable in fiscal 2026 should all of the eligible associated noncontrolling interest holders elect to exercise their Put Rights during fiscal 2026.
The FSG's organic net sales growth reflects increased demand within its aftermarket replacement parts, repair and overhaul parts and services, and specialty products product lines resulting in net sales increases of $172.1 million, $33.5 million and $20.1 million, respectively.
The FSG's organic net sales growth reflects increased demand within its aftermarket replacement parts, repair and overhaul parts and services, and specialty products product lines resulting in net sales increases of $263.9 million, $67.8 million and $35.6 million, respectively.
Liquidity and Capital Resources The following table summarizes our capitalization (in thousands): As of October 31, 2024 2023 Cash and cash equivalents $162,103 $171,048 Total debt (including current portion) 2,229,374 2,478,078 Shareholders’ equity 3,697,406 3,193,151 Total capitalization (debt plus equity) 5,926,780 5,671,229 Total debt to total capitalization 38% 44% Our principal uses of cash include acquisitions, capital expenditures, interest payments, cash dividends, distributions to noncontrolling interests and working capital needs.
Liquidity and Capital Resources The following table summarizes our capitalization (in thousands): As of October 31, 2025 2024 Cash and cash equivalents $217,781 $162,103 Total debt (including current portion) 2,167,945 2,229,374 Shareholders’ equity 4,379,175 3,697,406 Total capitalization (debt plus equity) 6,547,120 5,926,780 Total debt to total capitalization 33% 38% 39 Index Our principal uses of cash include acquisitions, interest payments, capital expenditures, cash dividends, distributions to noncontrolling interests and working capital needs.
The Notes are fully and unconditionally guaranteed on a senior unsecured basis by all of our existing and future subsidiaries that guarantee our obligations under the Credit Facility (the “Guarantor Group”).
The Notes are fully and unconditionally guaranteed on a senior unsecured basis by all of our existing and future subsidiaries that guarantee our obligations under the Credit Facility (the “Guarantor Group”). We were in compliance with all covenants related to the Notes as of October 31, 2025.
Net Income Attributable to HEICO Net income attributable to HEICO increased by 27% to a record $514.1 million, or $3.67 per diluted share, in fiscal 2024, up from $403.6 million, or $2.91 per diluted share, in fiscal 2023 principally reflecting the previously mentioned higher consolidated operating income, partially offset by the previously mentioned higher interest expense.
Net Income Attributable to HEICO Net income attributable to HEICO increased by 34% to a record $690.4 million, or $4.90 per diluted share, in fiscal 2025, up from $514.1 million, or $3.67 per diluted share, in fiscal 2024, principally reflecting the previously mentioned higher consolidated operating income.
When performing the quantitative impairment test, we compare the fair value of each of our reporting units to its carrying value to determine potential impairment and an impairment loss is recognized in the amount by which the carrying value of a reporting unit’s goodwill exceeds its fair value.
If, after completing this assessment, it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying value, we proceed to a quantitative impairment test. 46 Index When performing the quantitative impairment test, we compare the fair value of each of our reporting units to its carrying value to determine potential impairment and an impairment loss is recognized in the amount by which the carrying value of a reporting unit’s goodwill exceeds its fair value.
Operating Income Our consolidated operating income increased by 32% to a record $824.5 million in fiscal 2024, up from $625.3 million in fiscal 2023.
Operating Income Our consolidated operating income increased by 24% to a record $1,019.0 million in fiscal 2025, up from $824.5 million in fiscal 2024.
The ETG's organic net sales decline is mainly attributable to decreased demand for its other electronics and medical products resulting in net sales decreases of $45.0 million and $14.0 million, respectively, partially offset by increased demand for its defense and aerospace products resulting in net sales increases of $24.4 million and $12.9 million, respectively.
The ETG's organic net sales growth is mainly attributable to increased demand for its defense, space, other electronics, and aerospace products resulting in net sales increases of $29.6 million, $28.4 million, $20.6 million, and $16.2 million, respectively, partially offset by decreased demand for its medical products resulting in a net sales decrease of $9.4 million.
The increase in consolidated operating income as a percentage of net sales principally reflects an increase in the FSG’s operating income as a percentage of net sales to 22.5% in fiscal 2024, up from 21.9% in fiscal 2023, partially offset by a decrease in the ETG's operating income as a percentage of net sales to 22.8% in fiscal 2024, as compared to 23.3% in fiscal 2023.
The increase in consolidated operating income as a percentage of net sales principally reflects an increase in the FSG’s operating income as a percentage of net sales to 24.1% in fiscal 2025, up from 22.5% in fiscal 2024, and an increase in the ETG's operating income as a percentage of net sales to 23.0% in fiscal 2025, up from 22.8% in fiscal 2024.
Changes in estimates did not have a material effect on net income from consolidated operations in fiscal 2024, 2023 and 2022. Business Combinations We allocate the purchase price of acquired entities to the underlying tangible and identifiable intangible assets acquired and liabilities and any noncontrolling interests assumed based on their estimated fair values, with any excess recorded as goodwill.
Business Combinations We allocate the purchase price of acquired entities to the underlying tangible and identifiable intangible assets acquired and liabilities and any noncontrolling interests assumed based on their estimated fair values, with any excess recorded as goodwill.
The net sales increase in the FSG reflects $643.5 million contributed by fiscal 2023 and 2024 acquisitions as well as strong organic growth of 13%.
The net sales increase in the FSG reflects strong organic growth of 14% and net sales of $110.6 million contributed by fiscal 2025 and 2024 acquisitions.
Additionally, our results of operations in fiscal 2024 have been affected by recent acquisitions as further detailed in Note 2, Acquisitions, of the Notes to Consolidated Financial Statements.
Additionally, our results of operations in fiscal 2025 have been affected by recent acquisitions as further detailed in Note 2, Acquisitions, of the Notes to Consolidated Financial Statements. 35 Index Presentation of Results of Operations and Liquidity and Capital Resources The following discussion and analysis of our Results of Operations and Liquidity and Capital Resources includes a comparison of fiscal 2025 to fiscal 2024.
The increase in the FSG's gross profit margin principally reflects the previously mentioned higher net sales within our aftermarket replacement parts and repair and overhaul parts and services product lines.
The increase in the FSG's gross profit margin principally reflects the previously mentioned net sales growth within its repair and overhaul parts and services product line and a more favorable product mix within the specialty products product line.
The increase in net working capital is inclusive of a $124.8 million increase in inventories to support an increase in consolidated backlog and a $65.6 million increase in accounts receivable resulting from the previously mentioned higher net sales and the timing of collections, partially offset by a $72.6 million increase in accrued expenses and other current liabilities principally from a higher level of accrued performance based-compensation due to the improved operating results and an increase in contract liabilities.
The increase in net working capital is inclusive of a $75.6 million increase in accounts receivable resulting from increased net sales and timing of collections, and a $44.9 million increase in inventories to support an increase in consolidated backlog, partially offset by a $44.6 million increase in accrued expenses and other current liabilities and a $15.4 million decrease in prepaid expenses and other current assets.
The increase in consolidated operating income principally reflects a $205.8 million increase (a 53% increase) to a record $593.1 million in operating income of the FSG and a $3.1 million increase (a 1% increase) to a record $288.2 million in operating income of the ETG.
The increase in consolidated operating income principally reflects a $157.3 million increase (a 27% increase) to a record $750.4 million in operating income of the FSG and a $36.8 million increase (a 13% increase) to a record $325.0 million in operating income of the ETG.
Net cash provided by operating activities was $448.7 million in fiscal 2023 and consisted primarily of net income from consolidated operations of $444.4 million, depreciation and amortization expense of $130.0 million (a non-cash item), $15.5 million in share-based compensation expense (a non-cash item) and $15.3 million in employer contributions to the HEICO Savings and Investment Plan (a non-cash item), partially offset by a $117.4 million increase in net working capital, a $26.5 million deferred income tax benefit (a non-cash item), and a $9.1 million impact from the amendment and termination of a contingent consideration agreement (a non-cash item).
Operating Activities Net cash provided by operating activities was $934.3 million in fiscal 2025 and consisted primarily of net income from consolidated operations of $745.6 million, depreciation and amortization expense of $196.1 million (a non-cash item), $34.4 million in share-based compensation expense (a non-cash item), net changes in other long-term liabilities and assets related to the HEICO Corporation Leadership Compensation Plan (the "LCP") of $23.5 million (principally participant deferrals and employer contributions), and $20.4 million in employer contributions to the HEICO Savings and Investment Plan (a non-cash item), partially offset by a $58.7 million increase in net working capital and a $48.6 million deferred income tax benefit (a non-cash item).
The increase in consolidated net sales principally reflects an increase of $869.2 million (a 49% increase) to a record $2,639.4 million in net sales of the FSG and an increase of $38.4 million (a 3% increase) to a record $1,263.6 million in net sales of the ETG.
The increase in consolidated net sales principally reflects an increase of $477.9 million (an 18% increase) to a record $3,117.3 million in net sales of the FSG and an increase of $149.5 million (a 12% increase) to a record $1,413.1 million in net sales of the ETG.
Net Income Attributable to Noncontrolling Interests Net income attributable to noncontrolling interests relates to the 20% noncontrolling interest held by Lufthansa Technik AG in HEICO Aerospace Holdings Corp. and the noncontrolling interests held by others in certain subsidiaries of the FSG and ETG.
We recognized a discrete tax benefit from stock option exercises in the first quarter of fiscal 2025 and 2024 of $27.2 million and $13.6 million, respectively. 38 Index Net Income Attributable to Noncontrolling Interests Net income attributable to noncontrolling interests relates to the 20% noncontrolling interest held by Lufthansa Technik AG in HEICO Aerospace Holdings Corp. and the noncontrolling interests held by others in certain subsidiaries of the FSG and ETG.
The decrease in our effective tax rate reflects a larger tax benefit from stock option exercises recognized in the first quarter of fiscal 2024. We recognized a discrete tax benefit from stock option exercises in both the first quarter of fiscal 2024 and 2023 of $13.6 million and $6.2 million, respectively.
Income Tax Expense Our effective tax rate decreased to 16.6% in fiscal 2025, down from 17.5% in fiscal 2024. The decrease in our effective tax rate principally reflects a larger tax benefit from stock option exercises recognized in the first quarter of fiscal 2025.
The increase in operating income of the ETG principally reflects the previously mentioned net sales growth and improved gross profit margin, partially offset by a lower level of SG&A efficiencies. Our consolidated operating income as a percentage of net sales improved to 21.4% in fiscal 2024, up from 21.1% in fiscal 2023.
The increase in operating income of the FSG principally reflects the previously mentioned net sales growth, improved gross profit margin, and SG&A expense efficiencies realized from the net sales growth. The increase in operating income of the ETG principally reflects the previously mentioned net sales growth and SG&A expense efficiencies realized from the net sales growth.
The net sales increase in the ETG includes $40.7 million contributed by fiscal 2023 and 2024 acquisitions, partially offset by a 2% organic net sales decline.
The net sales increase in the ETG reflects strong organic growth of 7% and net sales of $63.9 million contributed by fiscal 2025 and 2024 acquisitions.
Outlook As we look ahead to fiscal 2025, we anticipate net sales growth in both the FSG and ETG, driven primarily by organic growth supported by strong demand for the majority of our products. Additionally, we plan to drive growth through our recently completed acquisitions while positioning ourselves to capitalize on potential opportunities from future acquisitions.
Outlook Looking ahead to fiscal 2026, we anticipate net sales growth in both the FSG and ETG, driven by organic growth from increased demand for the majority of our products as well as growth through our recent acquisitions. We will continue to pursue selective acquisition opportunities to complement this growth.
The increase is principally attributable to a $114.7 million increase in net income from consolidated operations, a $63.5 million increase in the "Other" caption mainly from the previously mentioned receipt of advance long-term customer deposits in fiscal 2024, a $45.3 million increase in depreciation and amortization expense, a $9.1 million prior year impact from the amendment and termination of a contingent consideration agreement, an $8.1 million increase in net changes in other long-term liabilities and assets related to the LCP and a $7.5 million impact from intangible asset impairment expense, partially offset by a $25.6 million increase in net working capital mainly reflecting a $50.5 million increase in accrued expenses and other current liabilities and a $28.6 million increase in prepaid expenses and other current assets partially offset by a $44.8 million decrease in accounts receivable.
The increase is principally attributable to a $186.5 million increase in net income from consolidated operations, an $84.3 million decrease in net working capital, principally reflecting a lower investment in inventories, a $22.8 million increase in accrued contingent consideration, a $20.7 million increase in depreciation and amortization expense and a $15.6 million increase in share-based compensation expense, partially offset by a $42.7 million decrease in the "Other" caption mainly from a larger receipt of advance long-term customer deposits in fiscal 2024 and a $26.6 million increase in deferred income tax benefits.
The decrease in the ETG's operating income as a percentage of net sales principally reflects a 1.0% impact from an increase in SG&A expenses as a percentage of net sales principally reflecting the previously mentioned lower level of efficiencies, which was partially offset by the previously mentioned improved gross profit margin. 38 Index Interest Expense Interest expense increased to $149.3 million in fiscal 2024, as compared to $73.0 million in fiscal 2023.
The increase in the FSG’s operating income as a percentage of net sales principally reflects the previously mentioned improved gross profit margin. Interest Expense Interest expense decreased to $129.9 million in fiscal 2025, down from $149.3 million in fiscal 2024.
As of October 31, 2024 Current assets (excluding net intercompany receivable from non-guarantor subsidiaries) $1,642,341 Noncurrent assets 4,627,711 Net intercompany receivable from/ (payable to) non-guarantor subsidiaries 243,421 Current liabilities (excluding net intercompany payable to non-guarantor subsidiaries) 546,677 Noncurrent liabilities 2,793,193 Redeemable noncontrolling interests 243,277 Noncontrolling interests 49,900 Year ended October 31, 2024 Net sales $3,216,400 Gross profit 1,230,374 Operating income 697,691 Net income from consolidated operations 559,493 Net income attributable to HEICO 525,970 Year ended October 31, 2024 Intercompany net sales $12,493 Intercompany management fee 3,319 Intercompany interest income 8,738 Intercompany dividends 94,359 45 Index Critical Accounting Estimates We believe that the following are our most critical accounting estimates, which require management to make judgments about matters that are inherently uncertain.
As of October 31, 2025 Current assets (excluding net intercompany receivable from non-guarantor subsidiaries) $1,927,805 Noncurrent assets 5,280,470 Net intercompany receivable from/ (payable to) non-guarantor subsidiaries 260,672 Current liabilities (excluding net intercompany payable to non-guarantor subsidiaries) 721,365 Noncurrent liabilities 2,751,782 Redeemable noncontrolling interests 337,818 Noncontrolling interests 63,792 44 Index Year ended October 31, 2025 Net sales $3,808,827 Gross profit 1,487,664 Operating income 879,170 Net income from consolidated operations 739,571 Net income attributable to HEICO 695,407 Year ended October 31, 2025 Intercompany net sales $13,182 Intercompany management fee 4,236 Intercompany interest income 9,488 Intercompany dividends 99,327 Critical Accounting Estimates We believe that the following are our most critical accounting estimates, which require management to make judgments about matters that are inherently uncertain.
The decrease in consolidated SG&A expenses as a percentage of net sales principally reflects a .7% impact from the previously mentioned lower acquisition costs, partially offset by a .3% impact from both the previously mentioned higher intangible asset amortization expense and amendment and termination of a contingent consideration agreement.
The decrease in consolidated SG&A expenses as a 37 Index percentage of net sales principally reflects efficiencies realized from the previously mentioned net sales growth, partially offset by a .5% impact from the previously mentioned changes in the estimated fair value of accrued contingent consideration.
Gross Profit and Operating Expenses Our consolidated gross profit margin was 38.9% in both fiscal 2024 and 2023 and reflects increases of .5% in both the FSG’s and ETG’s gross profit margin.
Gross Profit and Operating Expenses Our consolidated gross profit margin improved to 39.8% in fiscal 2025, up from 38.9% in fiscal 2024, principally reflecting a 1.5% increase in the FSG's gross profit margin.
The increase in interest expense was principally due to an increase in the amount of outstanding debt related to fiscal 2023 acquisitions. Other Income Other income in fiscal 2024 and 2023 was not material. Income Tax Expense Our effective tax rate decreased to 17.5% in fiscal 2024, down from 20.0% in fiscal 2023.
The decrease in interest expense was principally due to a lower weighted-average interest rate on borrowings outstanding under our revolving credit facility and a decrease in the amount of outstanding debt. Other Income Other income in fiscal 2025 and 2024 was not material.
Net cash provided by financing activities in fiscal 2023 totaled $2,065.0 million.
Financing Activities Net cash used in financing activities in fiscal 2025 totaled $150.7 million.
During fiscal 2023, we borrowed $1,964.0 million under our revolving credit facility and received $1,189.5 million in proceeds from the issuance of senior unsecured notes, which were partially offset by $989.0 million in payments made on our revolving credit facility, $36.6 million of distributions to noncontrolling interests, $27.4 million of cash dividends on our common stock, redemptions of common stock related to stock option exercises aggregating $14.8 million, $12.6 million of contingent consideration payments, and $10.1 million paid of debt issuance costs.
During fiscal 2025, we made $550.0 million of payments on our revolving credit facility, $38.5 million of distributions to noncontrolling interests, paid $32.0 million of cash dividends on our common stock, and redeemed $22.4 million of common stock related to stock option exercises, partially offset by $495.0 million of borrowings on our revolving credit facility to fund certain fiscal 2025 acquisitions.
The increase in net working capital principally reflects a $132.9 million increase in inventories to support an increase in consolidated backlog. Net cash provided by operating activities increased by $223.6 million (a 50% increase) in fiscal 2024, up from $448.7 million in fiscal 2023.
The increase in net working capital principally reflects a $132.9 million increase in inventories to support an increase in consolidated backlog. Investing Activities Net cash used in investing activities totaled $731.7 million in fiscal 2025 and related primarily to acquisitions of $629.8 million, capital expenditures of $72.9 million, and LCP funding of $33.0 million.
Our 39 Index priorities include advancing the development of new products and services, further expanding market penetration, and maintaining our financial strength and flexibility, all with a strong emphasis on delivering long-term value to our shareholders. Inflation We have generally experienced increases in our costs of labor, materials and services consistent with overall rates of inflation.
Our disciplined financial management remains dedicated to creating long-term shareholder value through a balanced combination of making strategic acquisitions and organic expansion, while maintaining financial resilience and flexibility. Inflation We have generally experienced increases in our costs of labor, materials and services consistent with overall rates of inflation.
The increase in consolidated SG&A expenses principally reflects $118.4 million attributable to our fiscal 2023 and 2024 acquisitions, inclusive of $32.9 million of intangible asset amortization expense.
The increase in consolidated SG&A expenses principally reflects $31.0 million attributable to our fiscal 2025 and 2024 acquisitions, $22.8 million due to changes in the estimated fair value of accrued contingent consideration, $17.5 million of higher other selling expenses, and a $15.6 million increase in share-based compensation expense.
Net cash used in investing activities totaled $2,484.5 million in fiscal 2023 and related primarily to acquisitions of $2,421.8 million, capital expenditures of $49.4 million, and LCP funding of $18.9 million. 41 Index Financing Activities Net cash used in financing activities in fiscal 2024 totaled $389.4 million.
Net cash used in financing activities in fiscal 2024 totaled $389.4 million.
Removed
Presentation of Results of Operations and Liquidity and Capital Resources The following discussion and analysis of our Results of Operations and Liquidity and Capital Resources includes a comparison of fiscal 2024 to fiscal 2023.
Added
A similar discussion and analysis that compares fiscal 2024 to fiscal 2023 may be found in Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our Form 10-K for the fiscal year ended October 31, 2024.
Removed
The increase in the ETG's gross profit margin principally reflects the previously mentioned higher net sales of defense and aerospace products, partially offset by the previously mentioned decrease in net sales of other electronics and medical products.
Added
Our consolidated operating income as a percentage of net sales improved to 22.7% in fiscal 2025, up from 21.4% in fiscal 2024.
Removed
Additionally, the increase in consolidated SG&A expenses includes costs incurred to support the previously mentioned net sales growth resulting in increases of $23.7 million and $10.2 million in other general and administrative expenses and other selling expenses, respectively, a $9.1 37 Index million prior year impact from the amendment and termination of a contingent consideration agreement pertaining to a fiscal 2021 acquisition and a $7.6 million increase in performance-based compensation expense, partially offset by a $19.8 million decrease in acquisition costs.
Added
Net cash provided by operating activities increased by $261.9 million (a 39% increase) in fiscal 2025, up from $672.4 million in fiscal 2024.
Removed
The increase in operating income of the FSG principally reflects the previously mentioned net sales growth, a $15.0 million decrease in acquisition costs and the previously mentioned improved gross profit margin, partially offset by a $36.6 million increase in intangible asset amortization expense, a $15.9 million increase in performance-based compensation expense and a $9.1 million prior year impact from the previously mentioned termination of a contingent consideration agreement.
Added
Changes 45 Index in estimates did not have a material effect on net income from consolidated operations in fiscal 2025, 2024 and 2023.
Removed
The increase in the FSG’s operating income as a percentage of net sales principally reflects a .9% impact from lower acquisition costs, a .5% impact from the previously mentioned improved gross profit margin and a .4% impact from lower performance-based compensation expense as a percentage of net sales, partially offset by a .7% impact from the previously mentioned higher intangible asset amortization expense and a .5% prior year impact from the previously mentioned amendment and termination of a contingent consideration agreement.
Removed
Additionally, the decrease in our effective tax rate reflects a larger favorable impact from tax-exempt unrealized gains in the cash surrender values of life insurance policies related to the HEICO Leadership Compensation Plan (the “LCP”) in fiscal 2024, net of the nondeductible portion of the related gains in the LCP accounts of certain executive officers, as well as increased foreign-derived intangible income, which is subject to a lower tax rate.
Removed
If, after completing this assessment, it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying value, we proceed to a quantitative impairment test.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−0 removed3 unchanged
Biggest changeA hypothetical 10% weakening in the exchange rate of the Euro to the U.S. dollar as of October 31, 2024 would not have a material effect on our results of operations, financial position or cash flows. 50 Index
Biggest changeA hypothetical 10% weakening in the exchange rate of the Euro to the U.S. dollar as of October 31, 2025 would not have a material effect on our results of operations, financial position or cash flows. 49 Index
Due to the short duration of these financial instruments, a hypothetical 10% increase in interest rates as of October 31, 2024 would not have a material effect on our results of operations, financial position or cash flows. Foreign Currency Risk We have several foreign subsidiaries that utilize a functional currency other than the U.S. dollar, or principally the Euro.
Due to the short duration of these financial instruments, a hypothetical 10% increase in interest rates as of October 31, 2025 would not have a material effect on our results of operations, financial position or cash flows. Foreign Currency Risk We have several foreign subsidiaries that utilize a functional currency other than the U.S. dollar, or principally the Euro.
Based on our aggregate outstanding variable rate debt balance of $1,015.0 million as of October 31, 2024, a hypothetical 10% increase in interest rates would not have a material effect on our results of operations, financial position or cash flows.
Based on our aggregate outstanding variable rate debt balance of $960 million as of October 31, 2025, a hypothetical 10% increase in interest rates would not have a material effect on our results of operations, financial position or cash flows.

Other HEI 10-K year-over-year comparisons