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What changed in STONERIDGE INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of STONERIDGE INC'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.

+218 added−209 removedSource: 10-K (2026-03-16) vs 10-K (2025-03-03)

Top changes in STONERIDGE INC's 2025 10-K

218 paragraphs added · 209 removed · 160 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

26 edited+7 added−4 removed45 unchanged
Biggest changeFerraiolo, President of the PST Electronics Division. Mr. Ferraiolo was appointed to President of the Stoneridge Brazil Electronics Division in June 2017. Mr. Ferraiolo joined the Company in 2015 and previously served as the Chief Operating Officer of Stoneridge Brazil. From 2010 to 2015 he served as Vice President of Operations for Cannondale Sports Group in Brazil.
Biggest changeFerraiolo joined the Company in 2015 and previously served as the Chief Operating Officer of Stoneridge Brazil. From 2010 to 2015 he served as Vice President of Operations for Cannondale Sports Group in Brazil. Prior to that, Mr. Ferraiolo served as Director of European Commercial and Development, Autocam Corporation from 2005 to 2010. Robert J. Hartman Jr., Chief Accounting Officer.
To that end, we have established talent management programs, which include but are not limited to the following: • Periodic global employee engagement surveys and subsequent action planning • Regular talent reviews for employee development and succession planning • Feedback and coaching to ensure performance is aligned with our goals and strategic direction • Delivery of Code of Conduct and global policy training • New employee orientation with globally consistent and locally flexible messaging • Frequent global “town hall” meetings and other communications • Employee wellness programs • Opportunities for community and charitable involvement • Employee mentoring program • Internship programs When we hire new employees, we focus not just on the skills required for current positions, but the ever-changing complex skills and competencies that will be required as we move forward on our path to being the mobility industry’s integrated technology partner.
To that end, we have established talent management programs, which include but are not limited to the following: • Periodic global employee engagement surveys and subsequent action planning • Regular talent reviews for employee development and succession planning • Feedback and coaching to ensure performance is aligned with our goals and strategic direction • Delivery of Code of Conduct and global policy training • New employee orientation with globally consistent and locally flexible messaging • Frequent global and local “town hall” meetings and other communications • Employee wellness programs • Opportunities for community and charitable involvement • Employee mentoring program • Internship programs When we hire new employees, we focus not just on the skills required for current positions, but the ever-changing complex skills and competencies that will be required as we move forward on our path to being the mobility industry’s integrated technology partner.
This segment includes product lines such as vehicle monitoring and tracking devices, driver information systems, security alarms, convenience applications such as parking sensors and rearview cameras, telematics solutions used for fleet management and multimedia devices. These products improve the performance, safety and convenience features of our customers’ vehicles.
This segment includes product lines such as vehicle monitoring and tracking devices, driver information systems, security alarms, convenience applications such as parking sensors and rearview cameras, telematics solutions used for fleet management, infotainment and multimedia devices. These products improve the performance, safety and convenience features of our customers’ vehicles.
Our Human Capital focus will continue to be on employee engagement, employee and leadership development, communications, and employee health and safety. 4 Table of Contents Information About Our Executive Officers Each executive officer of the Company serves the Board of Directors at its pleasure. The Board of Directors appoints corporate officers annually.
Our Human Capital focus will continue to be on employee health and safety, employee engagement, employee and leadership development, and effective employee communications. 4 Table of Contents Information About Our Executive Officers Each executive officer of the Company serves the Board of Directors at its pleasure. The Board of Directors appoints corporate officers annually.
Our customers are increasingly utilizing electronic technology to comply with more stringent regulations (particularly emissions and safety) and to meet end-user demand for improved vehicle performance and greater convenience. As a result of this trend, per-vehicle electronic content has been increasing.
Our customers are increasingly utilizing electronic technology to comply with more stringent regulations (particularly safety) and to meet end-user demand for improved vehicle performance and greater convenience. As a result of this trend, per-vehicle electronic content has been increasing.
These collaborative efforts have resulted in the development of new and complimentary products and the enhancement of existing products. Our product development investment and spending activities are globally coordinated to maximize utilization of resources and collaboration among engineering resources which are organized based on resource availability, capability and cost effectiveness.
These collaborative efforts have resulted in the development of new and complementary products and the enhancement of existing products. Our product development investment and spending activities are globally coordinated to maximize utilization of resources and collaboration among engineering resources which are organized based on resource availability, capability and cost effectiveness.
These activities have acted as a catalyst for the advancement of our smart product portfolio, increasing our smart content from just over 50% of our sales in 2014 to almost 82% of our sales in 2024. Our product portfolio shift focuses on the megatrends driving the transportation and off-highway industries.
These activities have acted as a catalyst for the advancement of our smart product portfolio, increasing our smart content from just over 50% of our sales in 2014 to almost 82 % of our sales in 2025. Our product portfolio shift focuses on the megatrends driving the transportation and off-highway industries.
User-activated switches are used by a vehicle’s operator or passengers to manually activate in-vehicle accessories. Hidden switches are not typically visible to vehicle operators or passengers and are engaged to activate or deactivate selected functions as part of normal vehicle operations. We sell these products principally to the automotive market.
User-activated switches are used by a vehicle’s operator or passengers to manually activate in-vehicle accessories. Hidden switches are not typically visible to vehicle operators or passengers and are 1 Table of Contents engaged to activate or deactivate selected functions as part of normal vehicle operations. We sell these products principally to the automotive market.
Requests should be directed in writing to Investor Relations at Stoneridge, Inc., 39675 MacKenzie Drive, Suite 400, Novi, Michigan 48377. The SEC maintains a website (www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, including the Company.
Requests should be directed via email to investor_relations@stoneridge.com or in writing to Investor Relations at Stoneridge, Inc., 39675 MacKenzie Drive, Suite 400, Novi, Michigan 48377. The SEC maintains a website (www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, including the Company.
In 2019, the Company’s Control Devices segment sold its non-core switches and connectors business (the “Non-core Products”) and in 2020 announced the strategic exit of our PM sensor business to further align with our strategic plan.
In 2019, the Company's Control Devices segment sold its non-core switches and connectors business (the "Non-core Products") and in 2020 announced the strategic exit of our PM sensor business to further align with our strategic plan.
The following table sets forth for the periods indicated, the percentage of net sales derived from our principal end markets: Principal End Markets 2024 2023 2022 Commercial vehicle 54 % 51 % 48 % Automotive 28 % 31 % 34 % Off-highway and other 13 % 12 % 12 % Aftermarket distributors and monitoring services 5 % 6 % 6 % For further information related to our reportable segments and financial information about geographic areas, see Note 13 to the consolidated financial statements.
The following table sets forth for the periods indicated, the percentage of net sales derived from our principal end markets: Principal End Markets 2025 2024 2023 Commercial vehicle 51 % 54 % 51 % Automotive 29 % 28 % 31 % Off-highway and other 13 % 13 % 12 % Aftermarket distributors and monitoring services 7 % 5 % 6 % For further information related to our reportable segments and financial information about geographic areas, see Note 13 to the consolidated financial statements.
A significant decline in commercial, automotive, off-highway and agricultural vehicle production of our principal customers could adversely affect the Company. Our Control Devices and Electronics segments are moderately seasonal, impacted by mid-year and year-end shutdowns and the ramp-up of new model production at key customers.
A significant decline in commercial, automotive, off-highway and agricultural vehicle production of our principal customers could adversely affect the Company. Our Electronics segment is moderately seasonal, impacted by mid-year and year-end shutdowns and the ramp-up of new model production at key customers.
Human Capital Management As of December 31, 2024, the Company employed approximately 4,450 full time and temporary employees in 14 countries, with about 85 % located outside of the United States.
Human Capital Management As of December 31, 2025, the Company employed approximately 4,200 full time and temporary employees in 14 countries, with about 86% located outside of the United States.
The following table sets forth the names, ages, and positions of the executive officers of the Company: Name Age Position James Zizelman 64 President, Chief Executive Officer and Director Matthew R. Horvath 39 Chief Financial Officer and Treasurer Susan C. Benedict 58 Chief Human Resources Officer and Assistant General Counsel Caetano R.
The following table sets forth the names, ages, and positions of the executive officers of the Company, as of March 16, 2026: Name Age Position James Zizelman 65 President, Chief Executive Officer and Director Matthew R. Horvath 40 Chief Financial Officer and Treasurer Susan C. Benedict 59 Chief Human Resources Officer and Assistant General Counsel Caetano R.
Ferraiolo 57 President of the Stoneridge Brazil Division Robert J. Hartman Jr. 58 Chief Accounting Officer Natalia Noblet 47 President of the Electronics Division Rajaey Kased 45 President of the Control Devices Division James Zizelman, President, Chief Executive Officer and Director. Mr. Zizelman was appointed as President and Chief Executive Officer and elected as Director in January 2023.
Ferraiolo 58 President of the Stoneridge Brazil Division Robert J. Hartman Jr. 59 Chief Accounting Officer Natalia Noblet 48 President of the Electronics Division James Zizelman, President, Chief Executive Officer and Director. Mr. Zizelman was appointed as President and Chief Executive Officer and elected as Director in January 2023.
He previously served as Stoneridge’s Executive Director of Corporate Strategy and Investor Relations from September 2020 to August 2021, and prior to that as Director of Investor Relations from November 2016 to August 2020. Prior to joining Stoneridge, Mr.
Matthew R. Horvath, Chief Financial Officer and Treasurer. Mr. Horvath was appointed Chief Financial Officer and Treasurer in September 2021. He previously served as Stoneridge’s Executive Director of Corporate Strategy and Investor Relations from September 2020 to August 2021, and prior to that as Director of Investor Relations from November 2016 to August 2020. Prior to joining Stoneridge, Mr.
To a lesser extent, we also sell these products to the commercial vehicle and agricultural markets. 1 Table of Contents Electronics. Our Electronics segment designs and manufactures advanced driver information solutions, vision systems, connectivity and compliance solutions and control modules.
To a lesser extent, we also sell these products to the commercial vehicle and agricultural markets. Electronics. Our Electronics segment designs and manufactures advanced driver information solutions, vision systems, connectivity and compliance solutions and control modules. Vision systems, including our MirrorEye product, provide enhanced vehicle visibility and safety to drivers.
Hartman served as Corporate Controller of the Company since 2006 and prior to that as Stoneridge’s Director of Internal Audit from 2003. Natalia Noblet, President of the Electronics Division. Ms. Noblet was appointed as President of the Electronics Division in September 2024. Before joining Stoneridge, Ms.
Mr. Hartman was appointed as Chief Accounting Officer and to the role of principal accounting officer in July 2016. Prior to that, Mr. Hartman served as Corporate Controller of the Company since 2006 and prior to that as Stoneridge’s Director of Internal Audit from 2003. Natalia Noblet, President of the Electronics Division. Ms.
Benedict was appointed Chief Human Resources Officer and Assistant General Counsel in June 2019. Ms. Benedict previously served as Stoneridge’s Director of Legal since November 2017. Prior to Stoneridge, Ms. Benedict served as Senior Counsel for Koch Industries in October 2017 and Corporate Counsel for Guardian Industries from December 2012 to September 2017. Caetano R.
Benedict, Chief Human Resources Officer and Assistant General Counsel. Ms. Benedict was appointed Chief Human Resources Officer and Assistant General Counsel in June 2019. Ms. Benedict previously served as Stoneridge’s Director of Legal since November 2017. Prior to Stoneridge, Ms.
Noblet served as senior vice president EMEA (Europe, Middle East, Africa) region within ZF's Commercial Vehicle Solutions division from 2022 until August 2024. From 2020 to 2022 Ms. Noblet held various positions at ZF. From 2017 to 2020 Ms. Noblet served as Chief Quality Officer at WABCO. Rajaey Kased, President of the Control Devices Division. Mr.
Noblet was appointed as President of the Electronics Division in September 2024. Before joining Stoneridge, Ms. Noblet served as senior vice president EMEA (Europe, Middle East, Africa) region within ZF's Commercial Vehicle Solutions division from 2022 until August 2024. From 2020 to 2022 Ms. Noblet held various positions at ZF. From 2017 to 2020 Ms.
Segments and Products We conduct our business in three reportable business segments, which are the same as our operating segments: Control Devices, Electronics and Stoneridge Brazil. Control Devices. Our Control Devices segment designs and manufactures products that monitor, measure or activate specific functions within a vehicle. This segment includes product lines such as actuators, sensors, switches and connectors.
Our Control Devices segment, which was sold in January 2026, designs and manufactures products that monitor, measure or activate specific functions within a vehicle. This segment includes product lines such as actuators, sensors, switches and connectors.
Kased was employed at Delphi from 2005 to 2017 where he served in management and engineering roles of increasing responsibility. 5 Table of Contents Available Information We make available, free of charge through our website (www.stoneridge.com), our Annual Reports on Form 10-K (“Annual Report”), Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, all amendments to those reports, and other filings with the U.S.
Zizelman as President and Chief Executive Officer. 5 Table of Contents Available Information We make available, free of charge through our website (www.stoneridge.com), our Annual Reports on Form 10-K (“Annual Report”), Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, all amendments to those reports, and other filings with the U.S.
Advanced driver information solutions and connectivity and compliance products collect, store and display vehicle information such as speed, pressure, maintenance data, trip information, operator performance, temperature, distance traveled, and driver messages related to vehicle performance. Vision systems provide enhanced vehicle visibility and safety to drivers.
These benefits include elimination of blind spots, expanded field of view and improved nighttime visibility. Advanced driver information solutions and connectivity and compliance products collect, store and display vehicle information such as speed, pressure, maintenance data, trip information, operator performance, temperature, distance traveled, and driver messages related to vehicle performance.
Horvath spent six years at EY, formerly known as Ernst & Young, in the Transaction Advisory practice, primarily focused on business and asset valuation with a focus on the automotive and transportation industry from 2010 - 2016. Susan C. Benedict, Chief Human Resources Officer and Assistant General Counsel. Ms.
Horvath spent six years at EY, formerly known as Ernst & Young, in the Transaction Advisory practice, primarily focused on business and asset valuation with a focus on the automotive and transportation industry from 2010 - 2016. Mr. Horvath has resigned from the Company effective March 31, 2026, to pursue an opportunity outside of the Company. Susan C.
Our Corporate Governance Guidelines, Code of Business Conduct and Ethics, Code of Ethics for Senior Financial Officers, Whistleblower Policy and Procedures and the charters of the Board of Director’s Audit, Compensation, Nominating and Corporate Governance and Compliance and Ethics Committees are posted on our website as well. Copies of these documents will be available to any shareholder upon request.
Securities and Exchange Commission (“SEC”), as soon as reasonably practicable after they are filed with the SEC. Our Corporate Governance Guidelines, Code of Conduct, Code of Ethics for Senior Financial Officers, Whistleblower Policy and Procedures and the charters of the Board of Directors' Audit, Compensation, Nominating and Corporate Governance and Compliance and Ethics Committees are posted on our website.
Zizelman was employed at Delphi for more than 20 years, where he was last a Vice President of Engineering from 2016 to 2017. Matthew R. Horvath, Chief Financial Officer and Treasurer. Mr. Horvath was appointed Chief Financial Officer and Treasurer in September 2021.
Zizelman was employed at Delphi for more than 20 years, where he was last a Vice President of Engineering from 2016 to 2017. Effective April 1, 2026, Ms. Noblet will succeed Mr. Zizelman as President and Chief Executive Officer. Mr. Zizelman, who is retiring on May 20, 2026, will remain with the Company as a strategic advisor until his retirement.
Removed
We have positioned each of our segments for continued long-term success. Our Control Devices segment is increasingly well positioned with a focus on continued development and commercialization of actuation and powertrain agnostic applications that will drive future growth for the segment.
Added
In January 2026, the Company completed the strategic review of its Control Devices business and announced the sale of the Control Devices segment. The strategic review of the Control Devices business did not meet the criteria for classifying the Control Devices segment as held for sale as of December 31, 2025.
Removed
Prior to that, Mr. Ferraiolo served as Director of European Commercial and Development, Autocam Corporation from 2005 to 2010. Robert J. Hartman Jr., Chief Accounting Officer. Mr. Hartman was appointed as Chief Accounting Officer and to the role of principal accounting officer in July 2016. Prior to that, Mr.
Added
As such, the consolidated financial statements include the Control Devices segment in continuing operations for all periods presented. As a result of this sale, we will now focus our resources on the highest growth, highest return opportunities and reduce overall organizational complexity leading to a clear, focused strategy for the Company. We have positioned our business for continued long-term success.
Removed
Kased was appointed as President of the Control Devices Division in January 2023. He previously was the Vice President of Sales, Strategy, and Product Line Management for the Control Devices Division from 2019. Prior to joining Stoneridge, Mr. Kased served as Head of Business Development, ADAS and Powertrain, North America, at Henkel from 2017 to 2019. Prior to that, Mr.
Added
Segments and Products As of December 31, 2025, we conducted our business in three reportable business segments, which are the same as our operating segments: Control Devices, Electronics and Stoneridge Brazil. In January 2026, we sold the Control Devices segment. As a result, we now operate our business in two reportable business segments. Control Devices.
Removed
Securities and Exchange Commission (“SEC”), as soon as reasonably practicable after they are filed with the SEC.
Added
Benedict served as Senior Counsel for Koch Industries in October 2017 and Corporate Counsel for Guardian Industries from December 2012 to September 2017. Caetano R. Ferraiolo, President of the Stoneridge Brazil Division. Mr. Ferraiolo was appointed to President of the Stoneridge Brazil Electronics Division in June 2017. Mr.
Added
Noblet served as Chief Quality Officer at WABCO. In addition, Ms. Noblet spent nearly two decades at WABCO in increasingly senior roles across operations, sourcing, quality, project management, and continuous improvement. Ms. Noblet also led complex, multi-regional businesses with full profit and loss responsibility. Effective April 1, 2026, Ms. Noblet will succeed Mr.
Added
Our Modern Slavery Act Statement, Cybersecurity Policy, Global Human Rights and Working Conditions Policy, Global Environmental Policy and Global Workplace Health and Safety Policy are posted on our website as well. Copies of these documents will be available to any shareholder upon request.
Added
The information contained on or accessible through our website is not incorporated by reference into this Annual Report on Form 10-K and should not be considered part of this or any other report filed with the SEC.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

26 edited+10 added−16 removed78 unchanged
Biggest changeDuring the Covenant Relief Period: • the maximum leverage ratio of 3.50 was increased to 6.00 for the quarter ended March 31, 2025, 5.50 for the quarter ended June 30, 2025, 4.50 for the quarter ended September 30, 2025 and 3.50 for the quarter ended December 31, 2025; • the minimum interest coverage ratio of 3.50 was waived for the quarter ended December 31, 2024 and was reduced to 2.00 for the quarters ended March 31 and June 30, 2025, and 2.50 and 3.50 for the quarter ended September 30, 2025 and December 31, 2025, respectively; • the Company’s aggregate amount of cash and cash equivalents (as defined) cannot exceed $70.0 million; • the sale of significant assets (as defined) will require repayment in the amount of any net cash proceeds received and result in the reduction of the Credit Facility commitment, at the lesser of $100.0 million or the net cash proceeds; • there were certain restrictions on Restricted Payments (as defined); and • a Permitted Acquisition (as defined) could not be consummated unless otherwise approved in writing by the required lenders.
Biggest changeAmendment No. 3 also provides for certain covenant relief and adjustments to terms and conditions as follows: • expiration date of the Credit Facility is extended from November 2, 2026 to July 1, 2027; • the current minimum interest coverage ratio of 2.50 will be reduced to 1.60 for the quarter ended March 31, 2026, 1.70 for the quarter ended June 30, 2026, 1.75 for the quarter ended September 30, 2026 and 2.50 for the quarter ended December 31, 2026 and thereafter; • the maximum leverage ratio was increased to 3.75 for the quarter ended December 31, 2025, increases to 6.25 for the quarter ended March 31, 2026, 6.75 for the quarter ended June 30, 2026, 6.00 for the quarter ended September 30, 2026 and 4.00 for the quarter ended December 31, 2026 and thereafter; • on December 31, 2026, the current borrowing capacity of $175.0 million will be reduced to the lesser of $157.5 million or the then current Credit Facility commitment; • modifications to Consolidated EBITDA (as defined); and • modifications and additions to affirmative covenants.
Our Credit Facility limits our ability to, among other things: • incur additional debt and guarantees; • pay dividends and repurchase our shares; • make other restricted payments, including investments; • create liens; 7 Table of Contents • sell or otherwise dispose of assets, including capital shares of subsidiaries; • enter into agreements that restrict dividends from subsidiaries; • consolidate, merge or sell or otherwise dispose of all or substantially all of our assets; and • substantially change the nature of our business.
Our Credit Facility limits our ability to, among other things: • incur additional debt and guarantees; • pay dividends and repurchase our shares; • make other restricted payments, including investments; • create liens; • sell or otherwise dispose of assets, including capital shares of subsidiaries; • enter into agreements that restrict dividends from subsidiaries; • consolidate, merge or sell or otherwise dispose of all or substantially all of our assets; and 7 Table of Contents • substantially change the nature of our business.
Failure to successfully identify, complete and/or integrate acquisitions could have a material adverse effect on us. A portion of our growth in sales and earnings has been generated from acquisitions and subsequent improvements in the performance of the businesses acquired. We expect to follow a strategy of selectively identifying and acquiring businesses with complementary products.
Failure to successfully identify, complete and/or integrate acquisitions could have a material adverse effect on us. A portion of our growth in sales and earnings has historically been generated from acquisitions and subsequent improvements in the performance of the businesses acquired. We expect to follow a strategy of selectively identifying and acquiring businesses with complementary products.
Despite recent trade negotiations between the U.S. and the Mexican, Canadian and Chinese governments, given the uncertainty regarding the scope and duration of any new tariffs, as well as the potential for additional tariffs or trade barriers by the U.S., Mexico, Canada, China or other countries, we can provide no assurance that any strategies we implement to mitigate the impact of such tariffs or other trade actions will be successful.
Despite recent trade negotiations between the U.S. and the Mexican, Canadian, Chinese and Brazilian governments, given the uncertainty regarding the scope and duration of any new tariffs, as well as the potential for additional tariffs or trade barriers by the U.S., Mexico, Canada, China, Brazil or other countries, we can provide no assurance that any strategies we implement to mitigate the impact of such tariffs or other trade actions will be successful.
In some cases, we are permitted to pass on to our customers the cost increases associated with specific materials. However, cost overruns that we cannot pass on to our customers and the inability to achieve productivity and cost reduction targets could adversely affect our business, financial condition or results of operations.
In some cases, we are permitted to pass on to our customers the cost increases associated with specific materials or incremental tariffs. However, cost overruns that we cannot pass on to our customers and the inability to achieve productivity and cost reduction targets could adversely affect our business, financial condition or results of operations.
We may incur material product liability costs. We may be subject to product liability claims in the event that the failure of any of our products results in personal injury or death and we cannot assure that we will not experience material product liability losses in the future.
We may be subject to product liability claims in the event that the failure of any of our products results in personal injury or death and we cannot assure that we will not experience material product liability losses in the future.
Several factors may change forecasted revenue from awarded programs; namely, new business wins, vehicle production volume changes, customer price reductions, foreign currency exchange rates, component take rates by customers and short cycled or cancelled models or platforms. We must implement and sustain a competitive technological advantage in producing our products to compete effectively.
Several factors may change forecasted revenue from awarded programs; namely, new business wins, vehicle production volume changes, customer price reductions, foreign currency exchange rates, component take rates by customers and short cycled or cancelled models or platforms. 6 Table of Contents We must implement and sustain a competitive technological advantage in producing our products to compete effectively.
Any of these consequences could have a material adverse effect on our business, financial condition or results of operations. Strategic Performance Risks Our inability to effectively manage the timing, quality and costs of new program launches could adversely affect our financial performance.
Any of these consequences could have a material adverse effect on our business, financial condition or results of operations. 10 Table of Contents Strategic Performance Risks Our inability to effectively manage the timing, quality and costs of new program launches could adversely affect our financial performance.
Our inability to maintain successful relationships with dealers and distributors, or to expand our distribution channels, could have a material adverse effect on our business, financial condition or results of operations. Geopolitical Uncertainties We are subject to risks related to our international operations. Approximately 51% of our net sales in 2024 were derived from sales outside of North America.
Our inability to maintain successful relationships with dealers and distributors, or to expand our distribution channels, could have a material adverse effect on our business, financial condition or results of operations. Geopolitical Uncertainties We are subject to risks related to our international operations. Approximately 54% of our net sales in 2025 were derived from sales outside of North America.
We cannot assure you that any business acquired by us will be successfully integrated with our operations or prove to be profitable. We could incur substantial indebtedness in connection with our acquisition strategy, which could significantly increase our interest expense. 10 Table of Contents We anticipate that acquisitions could occur in foreign markets in which we do not currently operate.
We cannot assure you that any business acquired by us will be successfully integrated with our operations or prove to be profitable. We could incur substantial indebtedness in connection with our acquisition strategy, which could significantly increase our interest expense. We anticipate that acquisitions could occur in foreign markets in which we do not currently operate.
The secure operation of these IT networks and systems and the proper processing and maintenance of this electronic information are critical to our business operations. In addition, we continually update our IT networks and systems in response to the changing needs of our business and periodically upgrade our ERP systems.
The secure operation of these IT networks and systems and the proper processing and maintenance of this electronic information are critical to our business operations. 12 Table of Contents In addition, we continually update our IT networks and systems in response to the changing needs of our business and periodically upgrade our ERP systems.
Our debt obligations could limit our flexibility in managing our business and expose us to risks. As of December 31, 2024, there was $201.6 million in borrowings outstanding on our Fifth Amended and Restated Credit Agreement (the “Credit Facility”). In addition, we are permitted under our Credit Facility to incur additional debt, subject to specified limitations.
Our debt obligations could limit our flexibility in managing our business and expose us to risks. As of December 31, 2025, there was $180.9 million in borrowings outstanding on our Fifth Amended and Restated Credit Agreement, as amended (the “Credit Facility”). In addition, we are permitted under our Credit Facility to incur additional debt, subject to specified limitations.
In 2024, approximately 95% of our net sales were derived from commercial, automotive, off-highway and agricultural vehicle markets while approximately 5% were derived from aftermarket distributors and monitoring services markets.
In 2025, approximately 93% of our net sales were derived from commercial, automotive, off-highway and agricultural vehicle markets while approximately 7% were derived from aftermarket distributors and monitoring services markets.
We are dependent on several principal customers for a significant percentage of our net sales. In 2024, our top five customers were PACCAR, Traton, Volvo, Daimler Truck and Ford, which comprised 16%, 13%, 13%, 7% and 7% of our net sales, respectively. In 2024, our top ten customers accounted for 66% of our net s ales.
We are dependent on several principal customers for a significant percentage of our net sales. In 2025, our top five customers were Volvo, PACCAR, Traton, Daimler Truck and Ford, which comprised 18%, 15%, 11%, 7% and 6% of our net sales, respectively. In 2025, our top ten customers accounted for 69% of our net s ales.
In addition, our competitors may design products around our patents that avoid infringement and violation of our intellectual property rights. 11 Table of Contents We cannot be certain that we have rights to all intellectual property currently used in the conduct of our businesses or that we have complied with the terms of agreements by which we acquire such rights, which could expose us to infringement, misappropriation or other claims alleging violations of third party intellectual property rights, or customer indemnification claims.
We cannot be certain that we have rights to all intellectual property currently used in the conduct of our businesses or that we have complied with the terms of agreements by which we acquire such rights, which could expose us to infringement, misappropriation or other claims alleging violations of third party intellectual property rights, or customer indemnification claims.
For example, in February 2025, the U.S. government imposed or threatened to impose new tariffs on imported products from Mexico, Canada and China.
For example, in February 2026, the U.S. government imposed or threatened to impose new tariffs on imported products.
In the case of pending patent applications, we may not be successful in securing issued patents or securing patents of a scope that provide us with a competitive advantage for our businesses.
In the case of pending patent applications, we may not be successful in securing issued patents or securing patents of a scope that provide us with a competitive advantage for our businesses. In addition, our competitors may design products around our patents that avoid infringement and violation of our intellectual property rights.
The costs of claims estimated to be due and payable could differ materially from what we may ultimately be required to pay. An increase in the rate of warranty claims or the occurrence of unexpected warranty claims could have a material adverse effect on our customer relations, our business, financial condition, or results of operations.
An increase in the rate of warranty claims or the occurrence of unexpected warranty claims could have a material adverse effect on our customer relations, our business, financial condition, or results of operations. We may incur material product liability costs.
At December 31, 2024, significant concentrations of net assets outside of North America included $202.4 million in Europe, $45.5 million in Asia Pacific and $35.7 million in South America. Non-current assets outside of North America accounted for approximately 59% of our non-current assets as of December 31, 2024.
At December 31, 2025, significant concentrations of net assets outside of North America included $204.1 million in Europe, $36.1 million in Asia Pacific and $44.3 million in South America. Non-current assets outside of North America accounted for approximately 81% of our non-current assets as of December 31, 2025.
Complying with these various laws could cause the Company to incur substantial costs. 12 Table of Contents Environmental, Climate and Weather Risks Compliance with environmental and other governmental regulations could be costly and require us to make significant expenditures.
In addition, the interpretation and application of consumer and data protection laws in the U.S., Europe and elsewhere are often uncertain and frequently change. Complying with these various laws could cause the Company to incur substantial costs. Environmental, Climate and Weather Risks Compliance with environmental and other governmental regulations could be costly and require us to make significant expenditures.
A successful claim brought against us that exceeds available insurance coverage or a requirement to participate in any product recall could have a material adverse effect on our business, financial condition or results of operations.
A successful claim brought against us that exceeds available insurance coverage or a requirement to participate in any product recall could have a material adverse effect on our business, financial condition or results of operations. 11 Table of Contents Intellectual Property Risks If we fail to protect our intellectual property rights or maintain our rights to use licensed intellectual property or are found liable for infringing the rights of others, our business could be adversely affected.
Our inability to continuously improve existing products, develop new products and achieve technological advances could have a material adverse effect on our business, financial condition or results of operations. 6 Table of Contents The discontinuation of, loss of business or lack of commercial success, with respect to a particular vehicle model for which the Company is a significant supplier could reduce the Company’s sales and harm its profitability.
The discontinuation of, loss of business or lack of commercial success, with respect to a particular vehicle model for which the Company is a significant supplier could reduce the Company’s sales and harm its profitability.
Amendment No. 1 added an additional level to the leverage ratio based pricing grid, through maturity, when the leverage ratio is greater than 3.50. Our ability to comply with these covenants as well as the negative covenants under the terms of our indebtedness may be affected by events beyond our control.
Our ability to comply with these covenants as well as the negative covenants under the terms of our indebtedness may be affected by events beyond our control.
We maintain warranty reserves in an amount based on historical trends of units sold and costs incurred, combined with our current understanding of the status of existing claims. To estimate the warranty reserves, we must forecast the resolution of existing claims, as well as expected future claims on products previously sold.
Our customers are increasingly seeking to hold suppliers responsible for product warranties, which could negatively impact our exposure to these costs. We maintain warranty reserves in an amount based on historical trends of units sold and costs incurred, combined with our current understanding of the status of existing claims.
If a product fails to comply with the warranty, we may be obligated or compelled, at our expense, to correct any defect by repairing or replacing the defective product. Our customers are increasingly seeking to hold suppliers responsible for product warranties, which could negatively impact our exposure to these costs.
Our warranty generally provides that products will be free from defects and adhere to customer specifications. If a product fails to comply with the warranty, we may be obligated or compelled, at our expense, to correct any defect by repairing or replacing the defective product.
Any failure to successfully integrate such acquisitions could have a material adverse effect on our business, financial condition or results of operations. If we do not respond appropriately, the evolution of the global transportation industry toward electrification and shared mobility could adversely affect our business.
Any failure to successfully integrate such acquisitions could have a material adverse effect on our business, financial condition or results of operations. Product Liability Risks Increased or unexpected product warranty claims could adversely affect us. We typically provide our customers a warranty covering workmanship, and in some cases materials, on products we manufacture.
Removed
Public health crises and other global health pandemics, epidemics or disease outbreaks could adversely impact our business, results of operation and financial condition. A significant public health crisis, pandemic or disease outbreak could adversely impact our business as well as those of our suppliers and customers.
Added
Our inability to continuously improve existing products, develop new products and achieve technological advances could have a material adverse effect on our business, financial condition or results of operations.
Removed
For example, the COVID-19 pandemic disrupted the global vehicle industry and customer sales, production volumes, supply of components critical to our business, and purchases of commercial, automotive, off-highway and agricultural vehicles by end-consumers. Any future significant public health crisis could adversely impact the global economy, our industry and the overall demand for our products.
Added
On March 6, 2026, the Company entered into Amendment No. 3 to the Fifth Amended and Restated Credit Agreement (“Amendment No. 3”). Amendment No. 3 amends and restates the Credit Facility in its entirety beginning December 31, 2025 and ending at the Credit Facility's amended termination date of July 1, 2027.
Removed
In addition, preventative or reactionary measures taken by governmental authorities may disrupt the ability of our employees, suppliers and other business partners to perform their respective functions and obligations relative to the conduct of our business.
Added
Military conflicts and geopolitical instability in the Middle East, including U.S. and Israeli military actions against Iran, could disrupt global markets and adversely affect our business.
Removed
Our ability to predict and respond to future changes resulting from potential health crises is uncertain as are the ultimate potential impacts on our business. The extent to which a pandemic or similar significant health crises will impact our business in the future is uncertain.
Added
Armed conflicts and heightened geopolitical tensions in the Middle East, including ongoing U.S. and Israeli military operations against Iran, pose risks to the global economy and to our business, even though we do not have direct operations in the region.
Removed
In addition, to the extent such significant health crises may adversely affect our business, financial condition, results of operations and cash flows, they may also have the effect of heightening many of the other risk factors in this section.
Added
A significant escalation of hostilities, including any disruption to the flow of oil through the Strait of Hormuz or other critical shipping lanes, could result in a rapid and sustained increase in global oil and energy prices, which would increase our transportation and logistics costs and the cost of petroleum-based production materials, including resins and certain molded plastic components, used across our manufacturing operations.
Removed
On February 26, 2025, we entered into Amendment No. 1 to the Fifth Amended and Restated Credit Agreement and Waiver ("Amendment No. 1").
Added
Higher energy and fuel prices would also adversely affect our OEM customers and the end markets we serve. Elevated fuel costs have historically reduced demand for commercial vehicles and off-highway equipment, which are the principal markets for our products and accounted for approximately 95% of our net sales in 2025.
Removed
Amendment No. 1 provides for certain financial covenant relief and additional covenant restrictions during the “Covenant Relief Period” (the period ending on the date that the Company delivers a compliance certificate for the quarter ending December 31, 2025).
Added
A sustained increase in fuel prices could lead OEM customers to reduce production volumes, delay new vehicle platform launches, or seek additional pricing concessions from their supply base, any of which would have a material adverse effect on our revenues and profitability.
Removed
In addition, there have been challenges at times in obtaining timely supply of nylon and resins for our Control Devices segment.
Added
In addition, an escalation of military action in the Middle East could disrupt global shipping routes, increase transit times and freight costs for components and raw materials sourced from Asia and Europe, and create broader supply chain bottlenecks similar to those experienced during prior periods of global disruption.
Removed
The global transportation industry is increasingly focused on the development of more fuel-efficient solutions to meet demands from consumers and governments worldwide to address climate change and an increased desire for environmentally sustainable solutions. The impacts of these changes on us are uncertain and could ultimately prove dramatic.
Added
Our business relies on electronic components sourced globally, including semiconductors, microprocessors, and memory devices, would be particularly vulnerable to such supply chain disruptions. Any macroeconomic deterioration resulting from an escalation in Middle Eastern hostilities could compound the existing challenges facing our business and could have a material adverse effect on our business, financial condition, results of operations, and liquidity.
Removed
If we do not respond appropriately, the evolution toward electrification and other energy sources could adversely affect our business. The increased adoption of electrified and other non-internal combustion-based powertrains may result in lower demand for some of our products.
Added
To estimate the warranty reserves, we must forecast the resolution of existing claims, as well as expected future claims on products previously sold. The costs of claims estimated to be due and payable could differ materially from what we may ultimately be required to pay.
Removed
There has also been an increase in consumer preferences for car and ride sharing, as opposed to automobile ownership, which may result in a long-term reduction in the number of vehicles per capita.
Removed
The evolution of the industry toward electrification and shared mobility has also attracted increased competition from entrants outside of the traditional light vehicle industry, some of whom may seek to provide products which compete with ours.
Removed
Failure to innovate and to develop or acquire new and compelling products that capitalize upon new technologies in response to these evolving consumer preferences and demands could adversely affect our business, financial condition or results of operations. Product Liability Risks Increased or unexpected product warranty claims could adversely affect us.
Removed
We typically provide our customers a warranty covering workmanship, and in some cases materials, on products we manufacture. Our warranty generally provides that products will be free from defects and adhere to customer specifications.
Removed
Intellectual Property Risks If we fail to protect our intellectual property rights or maintain our rights to use licensed intellectual property or are found liable for infringing the rights of others, our business could be adversely affected.
Removed
In addition, the interpretation and application of consumer and data protection laws in the U.S., Europe and elsewhere are often uncertain and frequently change.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe Company addresses identified risks and develops and implements controls to mitigate issues. The Company engages third parties in connection with its cybersecurity processes as appropriate. The Company has established processes to identify risks from cybersecurity threats associated with its third-party service providers.
Biggest changeThe Company engages third parties in connection with its cybersecurity processes as appropriate. The Company has established processes to identify risks from cybersecurity threats associated with its third-party service providers. The Company has established a cybersecurity policy which requires mandatory adherence by all Company directors, officers, employees, interns, consultants, and contractors.
For more information about the cybersecurity risks we face, refer to the Risk Factors in section “Information Technology and Cybersecurity Risks” in Part I, Item 1A, "Risk Factors". 13 Table of Contents Cybersecurity Governance The Company's Board of Directors, as a whole, has oversight responsibility for our strategic and operational risks.
For more information about the cybersecurity risks we face, refer to the Risk Factors in section “Information Technology and Cybersecurity Risks” in Part I, Item 1A, "Risk Factors". Cybersecurity Governance The Company's Board of Directors, as a whole, has oversight responsibility for our strategic and operational risks.
Training is administered and tracked through online learning modules. We work to continually evolve our systems to meet the constantly changing digital environment and continue to invest in the cybersecurity and resiliency of our networks and to enhance our internal controls and processes, which are designed to help protect our systems and infrastructure, and the information they contain.
We work to continually evolve our systems to meet the constantly changing digital environment and continue to invest in the cybersecurity and resiliency of our networks and to enhance our internal controls and processes, which are designed to help protect our systems and infrastructure, and the information they contain.
Item 1C. Cybersecurity. Cybersecurity Risk Management and Strategy The Company has processes in place to identify, assess, and monitor material risks from cybersecurity threats, which are part of the Company’s overall cybersecurity risk management strategy and have been embedded in the information systems operating procedures and internal controls.
Cybersecurity Risk Management and Strategy The Company has processes in place to identify, assess, and monitor material risks from cybersecurity threats, which are part of the Company’s overall cybersecurity risk management strategy and have been embedded in the information systems operating procedures and internal controls. 13 Table of Contents Our information technology (“IT”) function manages IT operations and continually evolves our systems to meet the constantly changing digital environment.
Our information technology (“IT”) function manages IT operations and continually evolves our systems to meet the constantly changing digital environment. We enhanced our workstation, server, email security, and network monitoring with managed extended detection and response and alerting capabilities. We perform periodic cybersecurity risk assessments to identify, assess, and prioritize potential risks to information, data assets, and infrastructure.
We enhanced our workstation, server, email security, and network monitoring with managed extended detection and response and alerting capabilities. We perform periodic cybersecurity risk assessments to identify, assess, and prioritize potential risks to information, data assets, and infrastructure. The Company addresses identified risks and develops and implements controls to mitigate issues.
The Company has established a cybersecurity policy which requires mandatory compliance of all Company directors, officers, employees, interns, consultants, and contractors. The Company has also established cybersecurity and information security awareness training programs. Employees with access to the Company’s network receive annual training on topics such as phishing, malware, and other cybersecurity risks.
The Company has also established cybersecurity and information security awareness training programs. Employees with access to the Company’s network receive periodic training on topics such as phishing, malware, and other cybersecurity risks. Training is administered and tracked through online learning modules.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following table provides information regarding our facilities: Location Owned/ Leased Use Square Footage Control Devices Lexington, Ohio Owned Manufacturing/Engineering 219,612 Suzhou, China (A) Leased Manufacturing/Engineering/Sales Office 145,033 Lexington, Ohio Leased Warehouse 15,000 Novi, Michigan Leased Engineering 6,398 Electronics Juarez, Mexico (B) Owned Manufacturing/Engineering 235,035 Tallinn, Estonia Leased Manufacturing/Engineering 85,911 Orebro, Sweden Leased Manufacturing/Engineering 77,472 Juarez, Mexico (B) Leased Warehouse/Division Office 64,873 Barneveld, Netherlands Owned Manufacturing/Engineering 62,700 El Paso, Texas (B) Leased Warehouse 57,000 Stockholm, Sweden Leased Engineering/Division Office 41,248 Bayonne, France Leased Sales Office/Warehouse 9,655 Dundee, Scotland Leased Sales Office/Engineering 4,683 Gothenburg, Sweden Leased Engineering 710 Stoneridge Brazil Manaus, Brazil Owned Manufacturing 94,103 Campinas, Brazil Owned Engineering/Division Office 45,467 Buenos Aires, Argentina Leased Sales Office 4,532 Hortolândia, Brazil Leased Sales Office 3,229 Serra, Brazil Leased Sales Office 344 Corporate and Other Novi, Michigan (A, B) Leased Headquarters/Division Office 37,713 Esslingen, Germany Leased Sales Office 1,722 __________________________________ (A) This facility is also used in the Electronics reportable segment.
Biggest changeThe following table provides information regarding our facilities: Location Owned/ Leased Use Square Footage Control Devices Lexington, Ohio Owned Manufacturing/Engineering 219,612 Suzhou, China (A) Leased Manufacturing/Engineering/Sales Office 145,033 Lexington, Ohio Leased Warehouse 15,000 Electronics Juarez, Mexico (B) Owned Manufacturing/Engineering 235,035 Tallinn, Estonia Leased Manufacturing/Engineering 85,911 Orebro, Sweden Leased Manufacturing/Engineering 77,472 Juarez, Mexico (B) Leased Warehouse/Division Office 64,873 Barneveld, Netherlands Owned Manufacturing/Engineering 62,700 El Paso, Texas (B) Leased Warehouse 57,000 Stockholm, Sweden Leased Engineering/Division Office 41,248 Bayonne, France Leased Sales Office/Warehouse 9,655 Novi, Michigan Leased Engineering 6,398 Dundee, Scotland Leased Sales Office/Engineering 4,683 Gothenburg, Sweden Leased Engineering 710 Stoneridge Brazil Manaus, Brazil Owned Manufacturing 94,103 Campinas, Brazil Owned Engineering/Division Office 45,467 Buenos Aires, Argentina Leased Sales Office 4,532 Hortolândia, Brazil Leased Sales Office 3,229 Serra, Brazil Leased Sales Office 344 Corporate and Other Novi, Michigan (A, B) Leased Headquarters/Division Office 37,713 Esslingen, Germany Leased Sales Office 1,722 __________________________________ (A) This facility is also used in the Electronics reportable segment.
Item 2. Properties. At December 31, 2024, the Company owned or leased seven manufacturing facilities, which together contain approximately 0.9 million square feet of manufacturing space. Of these manufacturing facilities, two are used by our Control Devices reportable segment, four are used by our Electronics reportable segment and one is used by our Stoneridge Brazil reportable segment.
Item 2. Properties. At December 31, 2025, the Company owned or leased seven manufacturing facilities, which together contain approximately 0.9 million square feet of manufacturing space. Of these manufacturing facilities, two are used by our Control Devices reportable segment, four are used by our Electronics reportable segment and one is used by our Stoneridge Brazil reportable segment.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePeriod Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Maximum number of shares that may yet be purchased under the plans or programs 10/1/24-10/31/24 183 $ 10.59 N/A N/A 11/1/24-11/30/24 237 $ 6.60 N/A N/A 12/1/24-12/31/24 1,848 $ 6.68 N/A N/A Total 2,268 Other than the repurchase of Common Shares of 50,275 and 87,387, respectively, to satisfy employee tax withholdings associated with the delivery of Common Shares earned by employees pursuant to equity-based awards under the Company’s Long-Term Incentive Plan there were no other repurchases of Common Shares made by us during the years ended December 31, 2024 or 2023.
Biggest changePeriod Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Maximum number of shares that may yet be purchased under the plans or programs 10/1/25-10/31/25 — $ — N/A N/A 11/1/25-11/30/25 — $ — N/A N/A 12/1/25-12/31/25 — $ — N/A N/A Total — Other than the repurchase of Common Shares of 58,511 and 50,275, respectively, to satisfy employee tax withholdings associated with the delivery of Common Shares earned by employees pursuant to equity-based awards under the Company’s Long-Term Incentive Plan there were no other repurchases of Common Shares made by us during the years ended December 31, 2025 or 2024.
This does not include persons whose stock is in nominee or “street name” accounts held by banks, brokers and other nominees. There were no sales of unregistered securities by the Company or its affiliates during the fiscal year ended December 31, 2024.
This does not include persons whose stock is in nominee or “street name” accounts held by banks, brokers and other nominees. There were no sales of unregistered securities by the Company or its affiliates during the fiscal year ended December 31, 2025.
The Company did not have a Board approved share repurchase program in effect in either 2024 or 2023.
The Company did not have a Board approved share repurchase program in effect in either 2025 or 2024.
The following table presents information with respect to repurchases of Common Shares made by us during the three months ended December 31, 2024. There were 2,268 Common Shares delivered to us by employees as payment for withholding taxes due upon vesting of performance share awards and share unit awards during the three months ended December 31, 2024.
The following table presents information with respect to repurchases of Common Shares made by us during the three months ended December 31, 2025. There were no Common Shares delivered to us by employees as payment for withholding taxes due upon vesting of performance share awards and share unit awards during the three months ended December 31, 2025.
The graph is based on the respective market price of each investment as of December 31, 2019, 2020, 2021, 2022, 2023 and 2024 assuming in each case an initial investment of $100 on December 31, 2019, and reinvestment of dividends. 2019 2020 2021 2022 2023 2024 Stoneridge, Inc. $ 100 $ 103 $ 67 $ 74 $ 67 $ 21 Dow Jones U.S.
The graph is based on the respective market price of each investment as of December 31, 2020, 2021, 2022, 2023, 2024 and 2025 assuming in each case an initial investment of $100 on December 31, 2020, and reinvestment of dividends. 2020 2021 2022 2023 2024 2025 Stoneridge, Inc. $ 100 $ 65 $ 71 $ 65 $ 21 $ 19 Dow Jones U.S.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our shares are listed on the New York Stock Exchange (“NYSE”) under the symbol “SRI.” As of February 26, 2025, we had 27,695,248 Common Shares, without par value, outstanding that were owned by approximately 250 shareholders of record.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our shares are listed on the New York Stock Exchange (“NYSE”) under the symbol “SRI.” As of March 1, 2026, we had 28,016,931 Common Shares, without par value, outstanding that were owned by approximately 250 shareholders of record.
Auto Parts Total Return Index $ 100 $ 118 $ 142 $ 105 $ 105 $ 81 NYSE Composite Index $ 100 $ 107 $ 129 $ 117 $ 133 $ 154 Item 6. [Reserved] 17 Table of Contents
Auto Parts Total Return Index $ 100 $ 121 $ 89 $ 89 $ 69 $ 80 NYSE Composite Index $ 100 $ 121 $ 109 $ 124 $ 144 $ 170 Item 6. [Reserved] 17 Table of Contents

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeItem 6. [Reserved] 17 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 18 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 28 Item 8. Financial Statements and Supplementary Data 30 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 67 Item 9A. Controls and Procedures 67 Item 9B.
Biggest changeItem 6. [Reserved] 17 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 18 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 29 Item 8. Financial Statements and Supplementary Data 31 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 70 Item 9A. Controls and Procedures 70 Item 9B.

Item 7. Management's Discussion & Analysis

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

85 edited+41 added−29 removed42 unchanged
Biggest changeOur Stoneridge Brazil segment net sales decreased $7.6 million primarily as a result of unfavorable foreign currency translation of $3.8 million and lower sales of our OEM products and monitoring service fees and tracking devices. 21 Table of Contents Net sales by geographic location are summarized in the following table (in thousands): Year ended December 31, 2024 2023 Dollar decrease Percent decrease North America $ 447,142 49.2 % $ 495,541 50.8 % $ (48,399) (9.8) % South America 49,649 5.5 57,214 5.9 (7,565) (13.2) % Europe and Other 411,504 45.3 423,063 43.3 (11,559) (2.7) % Total net sales $ 908,295 100.0 % $ 975,818 100.0 % $ (67,523) (6.9) % The decrease in North American net sales was mostly attributable to decreases in sales volume and the impact of expected end of life production for certain programs in our automotive market of $53.0 million as well as the 2023 impact of required electronic component spot buy purchases of $2.7 million.
Biggest changeNet sales by geographic location are summarized in the following table (in thousands): Year ended December 31, 2025 2024 Dollar increase / (decrease) Percent increase / (decrease) North America $ 392,298 45.5 % $ 447,142 49.2 % $ (54,844) (12.3) % South America 60,358 7.0 49,649 5.5 10,709 21.6 % Europe and Other 408,607 47.4 411,504 45.2 (2,897) (0.7) % Total net sales $ 861,263 100.0 % $ 908,295 100.0 % $ (47,032) (5.2) % 21 Table of Contents The decrease in our North American net sales was mostly attributable to production volume decreases at our customers which resulted in sales decreases in our commercial vehicle, automotive and off-highway markets of $37.5 million, $11.8 million and $5.6 million, respectively.
We record certain foreign currency transaction (gains) losses as a component of other (income) expense, net on the consolidated statement of operations.
Other Expense (Income), net . We record certain foreign currency transaction losses (gains) as a component of other expense (income), net on the consolidated statement of operations.
Our systems and products power vehicle intelligence, while enabling safety and security for global commercial, automotive, off-highway and agricultural vehicle markets. The following discussion and analysis should be read in conjunction with the consolidated financial statements and notes related thereto and other financial information included elsewhere herein. Segments We are organized by products produced and markets served.
Our systems and products power vehicle intelligence, while enabling safety and security for global commercial, off-highway and agricultural vehicle markets. The following discussion and analysis should be read in conjunction with the consolidated financial statements and notes related thereto and other financial information included elsewhere herein. Segments We are organized by products produced and markets served.
The Company has contributed $9.0 million to the Autotech Fund II since December 2018. Management will continue to focus on efficiently managing its weighted-average cost of capital and believes that cash flows from operations and the availability of funds from our Credit Facility provide sufficient liquidity to meet our future growth and operating needs.
The Company has contributed $9.3 million to the Autotech Fund II since December 2018. Management will continue to focus on efficiently managing its weighted-average cost of capital and believes that cash flows from operations and the availability of funds from our Credit Facility provide sufficient liquidity to meet our future growth and operating needs.
MD&A is provided as a supplement to, and should be read in conjunction with, the Company’s consolidated financial statements and related notes appearing in Item 8 of this Form 10-K “Financial Statements and Supplementary Data”. For discussion related to changes in financial condition and the results of operations for fiscal year 2023-related items, refer to Part II, Item 7.
MD&A is provided as a supplement to, and should be read in conjunction with, the Company’s consolidated financial statements and related notes appearing in Item 8 of this Form 10-K “Financial Statements and Supplementary Data”. For discussion related to changes in financial condition and the results of operations for fiscal year 2024-related items, refer to Part II, Item 7.
The Company’s wholly-owned subsidiary located in Stockholm, Sweden, has an overdraft credit line which allows overdrafts on the subsidiary’s bank account up to a daily maximum level of 20.0 million Swedish krona, or $1.8 million and $2.0 million, at December 31, 2024 and 2023, respectively.
The Company’s wholly-owned subsidiary located in Stockholm, Sweden, has an overdraft credit line which allows overdrafts on the subsidiary’s bank account up to a daily maximum level of 20.0 million Swedish krona, or $2.2 million and $1.8 million, at December 31, 2025 and 2024, respectively.
Further, affecting our quantitative assessment are future changes in the discount rate, as a result of a change in economic conditions or otherwise, which could result in the carrying value of the reporting unit exceeding its respective fair value. We performed our annual goodwill impairment analysis for our Electronics reporting unit at the beginning of the fourth quarter of 2024.
Further, affecting our quantitative assessment are future changes in the discount rate, as a result of a change in economic conditions or otherwise, which could result in the carrying value of the reporting unit exceeding its respective fair value. We performed our annual goodwill impairment analysis for our Electronics reporting unit at the beginning of the fourth quarter of 2025.
The Company has contributed $9.0 million to the Autotech Fund II since December 2018. We regularly evaluate the performance of our businesses and their cost structures, including personnel, and make necessary changes thereto in order to optimize our results. We also evaluate the required skill sets of our personnel and periodically make strategic changes.
The Company has contributed $9.3 million to the Autotech Fund II since December 2018. We regularly evaluate the performance of our businesses and their cost structures, including personnel, and make necessary changes thereto in order to optimize our results. We also evaluate the required skill sets of our personnel and periodically make strategic changes.
The cash flow sensitivities do not consider the offsetting impact of a lower discount rate assumption to reflect the reduced risk in estimated future cash flow growth used under the income approach or the related impacts on pricing multiples used under the market approach. 26 Table of Contents • A hypothetical increase in the discount rate of 100 basis points would not result in goodwill impairment; and • A hypothetical decrease in EBITDA margin of 100 basis points for each year in the forecast period would not result in goodwill impairment.
The cash flow sensitivities do not consider the offsetting impact of a lower discount rate assumption to reflect the reduced risk in estimated future cash flow growth used under the income approach or the related impacts on pricing multiples used under the market approach. • A hypothetical increase in the discount rate of 100 basis points would not result in goodwill impairment; and • A hypothetical decrease in EBITDA margin of 100 basis points for each year in the forecast period would not result in goodwill impairment.
In 2024 and 2023, the provision for income taxes was impacted by jurisdictional earnings mix, U.S. taxes on foreign earnings, various tax credits and incentives and tax losses for which no benefit is recognized due to valuation allowances.
In 2025 and 2024, the provision for income taxes was impacted by jurisdictional earnings mix, U.S. taxes on foreign earnings, various tax credits and incentives and tax losses for which no benefit is recognized due to valuation allowances.
As a consequence of these actions, we incur severance related costs which we refer to as business realignment charges. Business realignment costs of $2.6 million and $4.5 million were incurred during the years ended December 31, 2024 and 2023, respectively.
As a consequence of these actions, we incur severance related costs which we refer to as business realignment charges. Business realignment costs of $6.4 million and $2.6 million were incurred during the years ended December 31, 2025 and 2024, respectively.
Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company's Annual Report on Form 10-K for fiscal year 2023, which was filed with the Securities and Exchange Commission on March 1, 2024. We are a global supplier of safe and efficient electronics systems and technologies.
Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company's Annual Report on Form 10-K for fiscal year 2024, which was filed with the Securities and Exchange Commission on March 3, 2025. We are a global supplier of safe and efficient electronics systems and technologies.
As such, we quantitatively assessed our Electronics reporting unit as of December 31, 2024, and we determined the fair value of the reporting unit substantially exceeded its carrying value and that no impairment of goodwill was needed. Warranties.
As such, we quantitatively assessed our Electronics reporting unit as of December 31, 2024, and we determined the fair value of the reporting unit substantially exceeded its carrying value and that no impairment of goodwill was needed. 27 Table of Contents Warranties.
Recently Issued Accounting Standards Not Yet Adopted as of December 31, 2024 In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740) – Improvements to Income Tax Disclosures," which requires companies to disclose, on an annual basis, specific categories in the effective tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold.
Recently Adopted Accounting Standards In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740) – Improvements to Income Tax Disclosures," which requires companies to disclose, on an annual basis, specific categories in the effective tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold.
Realignment expense for the year ended December 31, 2024 was primarily related to the optimization of our engineering footprint and executive separation costs. We expect to incur business realignment costs in 2025 related operations at our Juarez facility, which we expect will result in cost savings for direct and indirect labor and a more efficient overall operating structure.
Realignment expense for 2025 was related to operational efficiency initiatives at our Juarez facility, which we expect will result in cost savings for direct and indirect labor and a more efficient overall operating structure . Realignment expense for the year ended December 31, 2024 was primarily related to the optimization of our engineering footprint and executive separation costs.
The Credit Facility also contains affirmative and negative covenants and events of default that are customary for credit arrangements of this type including covenants that place restrictions and/or limitations on the Company’s ability to borrow money, make capital expenditures and pay dividends. The Credit Facility had an outstanding balance of $201.6 million at December 31, 2024.
The Credit Facility also contains affirmative and negative covenants and events of default that are customary for credit arrangements of this type including covenants that place restrictions and/or limitations on the Company’s ability to borrow money, make capital expenditures and pay dividends. The Credit Facility had an outstanding balance of $180.9 million at December 31, 2025.
Our U.S. federal general business credits, if unused, begin to expire in 2025, and the state and foreign tax credits expire at various times.
Our U.S. federal general business credits, if unused, begin to expire in 2026, while the state and foreign tax credits expire at various times.
The Company has approximately $73.4 million of undrawn commitments un der the Credit Facility as of December 31, 2024, which results in total undrawn commitments and cash balances of more th an $145.3 million. Commitments and Contingencies See Note 11 to the consolidated financial statements for disclosures of the Company’s commitments and contingencies.
The Company has approximately $94.1 million of undrawn commitments un der the Credit Facility as of December 31, 2025, which results in total undrawn commitments and cash balances of more th an $160.3 million. Commitments and Contingencies See Note 11 to the consolidated financial statements for disclosures of the Company’s commitments and contingencies.
Our future results could also be unfavorably affected by increased commodity prices as commodity fluctuations impact the cost of our raw material purchases. At December 31, 2024, we had a cash and cash equivalents balance of approximately $71.8 million, of which 65.8% was held in foreign locations.
Our future results could also be unfavorably affected by increased commodity prices as commodity fluctuations impact the cost of our raw material purchases. At December 31, 2025, we had a cash and cash equivalents balance of approximately $66.3 million, of which 90.2% was held in foreign locations.
Other Matters A significant portion of our sales are outside of the United States. These sales are generated by our non-U.S. based operations, and therefore, movements in foreign currency exchange rates can have a significant effect on our results of operations, which are presented in U.S. dollars.
These sales are generated by our non-U.S. based operations, and therefore, movements in foreign currency exchange rates can have a significant effect on our results of operations, which are presented in U.S. dollars.
The Company contributed $0.6 million and $0.4 million, net to the Autotech Fund II during the years ended December 31, 2024 and 2023, respectively. Our future results could also be adversely affected by unfavorable changes in foreign currency exchange rates.
As of December 31, 2025, the Company’s cumulative investment in the Autotech Fund II was $9.3 million. The Company contributed $0.4 million and $0.6 million, net to the Autotech Fund II during the years ended December 31, 2025 and 2024, respectively. Our future results could also be adversely affected by unfavorable changes in foreign currency exchange rates.
At December 31, 2024 and 2023, there were no borrowings outstanding on this overdraft credit line. During the year ended December 31, 2024, the subsidiary borrowed and repaid 334.5 million Swedish krona, or $30.3 million.
At December 31, 2025 and 2024 there were no borrowings outstanding on this overdraft credit line. During the year ended December 31, 2025, the subsidiary borrowed and repaid 196.2 million Swedish krona, or $21.3 million.
Because of the competitive nature of the markets we serve, we face pricing pressures from our customers in the ordinary course of business.
We may incur additional realignment costs in the future. Because of the competitive nature of the markets we serve, we face pricing pressures from our customers in the ordinary course of business.
We continue to invest in the development of advanced system capabilities that are complementary to our driver information solutions and vision systems such as integrated driver assistance technologies and an intelligent connected trailer system.
We continue to focus on margin improvement through material cost reduction and product quality initiatives. We continue to invest in the development of advanced system capabilities that are complementary to our driver information solutions and vision systems such as integrated driver assistance technologies and an intelligent connected trailer system.
Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period.
Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. 26 Table of Contents On an ongoing basis, we evaluate estimates and assumptions used in our consolidated financial statements.
We continue to evaluate and optimize our engineering footprint to enhance capabilities and capacity for the most efficient return on our engineering spend. For example, we expect to utilize our Stoneridge Brazil engineering resources to support Electronics segment projects.
We continue to evaluate and optimize our engineering footprint to enhance capabilities and capacity for the most efficient return on our engineering spend including utilizing our Stoneridge Brazil engineering and dedicated engineering partners in India to support Electronics segment projects.
In 2024, the provision for income tax expense was $2.9 million, resulting in an effective tax rate of (21.5)%. In 2023, the provision for income tax expense was $3.3 million, resulting in an effective tax rate of (169.7)%.
In 2025, the provision for income tax expense was $47.4 million, resulting in an effective tax rate of (85.4)%. In 2024, the provision for income tax expense was $2.9 million, resulting in an effective tax rate of (21.5)%.
Over the long-term, we expect our Electronics’ segment sales to continue to outperform forecasted changes in production volumes due to strong demand for our existing products including our OEM MirrorEye programs in North America and Europe as well as our next generation tachograph in Europe.
Over the long-term, we expect our Electronics’ segment sales to continue to outperform forecasted changes in production volumes due to strong demand for our existing products including our OEM MirrorEye programs in North America and Europe as well as from launches of awarded business. In addition, over the long-term we expect revenue growth and margin contribution from our off-highway products.
The Company’s wholly-owned subsidiary located in Suzhou, China, had lines of credit that allowed up to a maximum borrowing level of 20.0 million Chinese yuan, or $2.7 million and $2.8 million, at December 31, 2024 and 2023, respectively.
The Company’s wholly-owned subsidiary located in Suzhou, China, has lines of credit that allow up to a maximum borrowing level of 50.0 million Chinese yuan, or $7.2 million at December 31, 2025, and 20.0 million Chinese yuan, or $2.7 million, at December 31, 2024. At December 31, 2025 and 2024 there were no borrowings outstanding on the Suzhou credit lines.
Other income, net of $2.5 million, increased by $3.8 million in 2024 compared to other expense, net of $1.2 million for 2023 due to the impact of favorable foreign currency movements in our Electronics and Stoneridge Brazil segments from strengthening of the U.S. dollar. Provision for Income Taxes.
Other expense, net of $3.6 million, increased by $6.1 million in 2025 compared to other income, net of $2.5 million for 2024 due to the impact of unfavorable foreign currency movements in our Electronics and Control Devices segments from weakening of the U.S. dollar especially against the euro and Swedish krona. Provision for Income Taxes.
At December 31, 2024 and 2023, we had cash and cash equivalents of $71.8 million and $40.8 million, respectively. At December 31, 2024 and 2023 , we had $201.6 million and $189.3 million , respectively, in borrowings outstanding on the Credit Facility.
At December 31, 2025 and 2024, we had cash and cash equivalents of $66.3 million and $71.8 million, respectively. At December 31, 2025 and 2024 , we had Credit Facility borrowings of $180.9 million and $201.6 million , respectively.
Summary of Future Cash Flows The following table summarizes our future cash outflows resulting from financial contracts and commitments, as of December 31, 2024 (in thousands): Total Less than 1 year 2-3 years 4-5 years After 5 years Credit Facility $ 201,577 $ — $ 201,577 $ — $ — Debt — — — — — Interest payments (A) 25,363 13,233 12,130 — — Operating leases 11,445 4,180 4,579 2,686 — Total contractual obligations (B) $ 238,385 $ 17,413 $ 218,286 $ 2,686 $ — (A) Includes estimated payments under the Company’s Credit Facility and other debt obligations using the most current interest rate and principal balance information available at December 31, 2024, extended through the end of the term.
Summary of Future Cash Flows The following table summarizes our future cash outflows resulting from financial contracts and commitments, as of December 31, 2025 (in thousands): Total Less than 1 year 2-3 years 4-5 years After 5 years Credit Facility $ 180,942 $ — $ 180,942 $ — $ — Debt — — — — — Interest payments (A) 19,275 12,850 6,425 — — Operating leases 15,088 4,532 6,716 3,491 349 Total contractual obligations (B) $ 215,305 $ 17,382 $ 194,083 $ 3,491 $ 349 (A) Includes estimated payments under the Company’s Credit Facility using the most current interest rate and principal balance information available at December 31, 2025, extended through the end of the term.
In December 2018, the Company entered into an agreement to make a $10.0 million investment in Autotech Fund II managed by Autotech. The Company’s $10.0 million investment in the Autotech Fund II will be contributed over the expected ten-year life of the fund. As of December 31 2024, the Company’s cumulative investment in the Autotech Fund II was $9.0 million.
At December 31, 2025 there were no borrowings outstanding on the bank acceptance draft line of credit. In December 2018, the Company entered into an agreement to make a $10.0 million investment in Autotech Fund II managed by Autotech. The Company’s $10.0 million investment in the Autotech Fund II will be contributed over the expected ten-year life of the fund.
Additionally, we continue to focus on improving manufacturing performance and optimizing our global cost structure to both reduce costs and improve operational efficiency. We expect these actions will benefit our future financial performance.
In order to minimize the impact of these incremental costs, we have taken several actions, including negotiating price increases and cost recoveries with our customers. Additionally, we continue to focus on improving manufacturing performance and optimizing our global cost structure to both reduce costs and improve operational efficiency. We expect these actions will benefit our future financial performance.
Overview During 2024, we were adversely affected by lower volumes from lower customer demand in most of our served markets, which was offset by sales in our Electronics segment related to the launches of a European OEM MirrorEye program and out next generation tachograph.
Overview During 2025, we were adversely affected by lower production volumes at our customers from lower demand in most of our served markets, which was partially offset by sales in our Electronics segment related to MirrorEye, including the ramp up of a previously launched European OEM program at the end of 2024 and two additional OEM program launches in North America that launched in 2025.
Further we significantly increased cash provided by operating activities by reducing working capital levels, specifically lowering inventory. The Company had net loss of $16.5 million, or $(0.60) per diluted share, for the year ended December 31, 2024.
We significantly increased cash provided by operating activities by reducing working capital levels, specifically lowering inventory through targeted actions and alignment with current production levels. The Company had a net loss of $102.8 million, or $(3.70) per diluted share, for the year ended December 31, 2025.
However, if we are unable to effectively manage production costs in the future to mitigate future pricing pressures, our results of operations would be adversely affected. 20 Table of Contents Year Ended December 31, 2024 Compared To Year Ended December 31, 2023 Consolidated statements of operations as a percentage of net sales are presented in the following table (in thousands): Year ended December 31, 2024 2023 Dollar increase / (decrease) Net sales $ 908,295 100.0 % $ 975,818 100.0 % $ (67,523) Costs and expenses: Cost of goods sold 719,042 79.2 774,512 79.4 (55,470) Selling, general and administrative 117,460 12.9 117,395 12.0 65 Design and development 72,174 7.9 71,075 7.3 1,099 Operating (loss) income (381) — 12,836 1.3 (13,217) Interest expense, net 14,447 1.6 13,000 1.3 1,447 Equity in loss of investee 1,292 0.1 522 0.1 770 Other (income) expense, net (2,523) (0.3) 1,236 0.1 (3,759) Loss before income taxes (13,597) (1.5) (1,922) (0.2) (11,675) Provision for income taxes 2,927 0.3 3,261 0.3 (334) Net loss $ (16,524) (1.8) % $ (5,183) (0.5) % $ (11,341) Net Sales.
However, if we are unable to effectively manage production costs in the future to mitigate future pricing pressures, our results of operations would be adversely affected. 20 Table of Contents Year Ended December 31, 2025 Compared To Year Ended December 31, 2024 Consolidated statements of operations as a percentage of net sales are presented in the following table (in thousands): Year ended December 31, 2025 2024 Dollar increase / (decrease) Net sales $ 861,263 100.0 % $ 908,295 100.0 % $ (47,032) Costs and expenses: Cost of goods sold 690,109 80.1 719,042 79.2 (28,933) Selling, general and administrative 125,605 14.6 117,460 12.9 8,145 Impairment of Control Devices assets 21,628 2.5 — — 21,628 Design and development 62,527 7.3 72,174 7.9 (9,647) Operating loss (38,606) (4.5) (381) — (38,225) Interest expense, net 13,578 1.6 14,447 1.6 (869) Equity in (earnings) loss of investee (340) — 1,292 0.1 (1,632) Other expense (income), net 3,608 0.4 (2,523) (0.3) 6,131 Loss before income taxes (55,452) (6.4) (13,597) (1.5) (41,855) Provision for income taxes 47,383 5.5 2,927 0.3 44,456 Net loss $ (102,835) (11.9) % $ (16,524) (1.8) % $ (86,311) Net Sales.
The increase was the result of higher outstanding Credit Facility balances. Equity in Loss of Investee. Equity loss for Autotech Fund II was $1.3 million and $0.5 million for the years ended December 31, 2024 and 2023, respectively . Other (Income) Expense, net .
Interest expense, net decreased by $0.9 million compared to 2024. The decrease was the result of lower outstanding Credit Facility borrowings and Credit Facility interest rates. Equity in (Earnings) Loss of Investee. Equity (earnings) loss for Autotech Fund II was $(0.3) million and $1.3 million for the years ended December 31, 2025 and 2024, respectively .
The Company expects to make additional repayments on the Credit Facility when cash exceeds the amount needed for operations and to remain in compliance with all covenants.
The Company expects to make additional repayments on the Credit Facility when cash exceeds the amount needed for operations and to remain in compliance with all covenants. 25 Table of Contents As of December 31, 2025, the outstanding Credit Facility borrowings were originally scheduled to mature on November 2, 2026.
The Company has not experienced a violation that would limit the Company’s ability to borrow under the Credit Facility, as amended, and does not expect that the covenants under it will restrict the Company’s financing flexibility. However, it is possible that future borrowing flexibility under the Credit Facility may be limited as a result of lower than expected financial performance.
However, it is possible that future borrowing flexibility under the Credit Facility may be limited as a result of lower than expected financial performance.
We have significant foreign denominated transaction exposure in certain locations, especially in Brazil, Argentina, Mexico, Sweden, Estonia, the Netherlands, United Kingdom and China. We have entered into foreign currency forward contracts to reduce our exposure related to certain foreign currency fluctuations. See Note 10 to the consolidated financial statements for additional details.
We have significant foreign denominated transaction exposure in certain foreign currencies including the Argentinian peso, Brazilian real, Chinese renminbi, euro, Mexican peso, and Swedish krona. We have historically entered into foreign currency forward contracts to reduce our exposure related to certain foreign currency fluctuations. See Note 10 to the consolidated financial statements for additional details.
This ASU will modify the Company's financial statement disclosures but will not have a significant impact on its consolidated financial statements. In November 2024, the FASB issued ASU No. 2024-03, "Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures," which requires companies to disclose certain costs and expenses within the notes to the financial statements.
The adoption of this ASU resulted in incremental disclosures in the Company's financial statements. 28 Table of Contents Recently Issued Accounting Standards Not Yet Adopted as of December 31, 2025 In November 2024, the FASB issued ASU No. 2024-03, "Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures," which requires companies to disclose certain costs and expenses within the notes to the financial statements.
Seasonality Our Control Devices and Electronics segments are moderately seasonal, impacted by mid-year and year-end shutdowns and the ramp-up of new model production at key customers.
Seasonality Our Electronics segment is moderately seasonal, impacted by mid-year and year-end shutdowns and the ramp-up of new model production at key customers. In addition, the demand for our Stoneridge Brazil segment consumer products is generally higher in the second half of the year.
Net sales for our reportable segments, excluding inter-segment sales are summarized in the following table (in thousands): Year ended December 31, 2024 2023 Dollar decrease Percent decrease) Control Devices $ 292,606 32.2 % $ 342,065 35.1 % $ (49,459) (14.5) % Electronics 566,040 62.3 576,539 59.0 (10,499) (1.8) % Stoneridge Brazil 49,649 5.5 57,214 5.9 (7,565) (13.2) % Total net sales $ 908,295 100.0 % $ 975,818 100.0 % $ (67,523) (6.9) % Our Control Devices segment net sales decreased $49.5 million primarily as a result of decreases in our North American automotive market of $52.9 million, including the impact of expected end of life production for certain programs as well as decreases in our China commercial vehicle market of $5.3 million.
Net sales for our reportable segments, excluding inter-segment sales are summarized in the following table (in thousands): Year ended December 31, 2025 2024 Dollar increase (decrease) Percent increase (decrease) Control Devices $ 274,500 31.9 % $ 292,606 32.2 % $ (18,106) (6.2) % Electronics 526,405 61.1 566,040 62.2 (39,635) (7.0) % Stoneridge Brazil 60,358 7.0 49,649 5.5 10,709 21.6 % Total net sales $ 861,263 100.0 % $ 908,295 100.0 % $ (47,032) (5.2) % Our Control Devices segment net sales decreased $18.1 million because of decreases in our North American automotive market of $11.8 million including the impact of end-of-life production for an actuator product as well as decreases in our China automotive and off-highway markets of $3.3 million and $2.5 million, respectively.
Dollar strengthened against the Argentine peso, Brazilian real, Mexican peso and Swedish krona in 2024 and the Chinese yuan and Argentine peso in 2023, unfavorably impacting our reported results.
Dollar weakened against the Brazilian real, Chinese renminbi, euro, Mexican peso and Swedish krona in 2025 unfavorably impacting our reported results. In 2024, the U.S dollar strengthened against the Brazilian real, Chinese renminbi and Swedish krona and weakened against the euro and Mexican peso which had a net favorable impact to our reported results.
In October 2024, the International Monetary Fund forecasted the Brazil gross domestic product to grow 2.2% in 2025, a decline from forecasted growth of 3.0% in 2024.
In October 2025, the International Monetary Fund forecasted the Brazil gross domestic product to grow 1.6% in 2026.
Segment gross margin de creased due to lower contribution from lower sales and adverse sales mix. Operating income de creased due lower sales and lower gross margin offset by lower SG&A because of a reduction in incentive compensation.
Segment gross margin as a percent of sales de creased due to unfavorable sales mix impact of higher OEM product sales offset by higher contribution from higher sales levels. Operating income in creased due to higher contribution from higher OEM product sales.
The tariffs on Mexico and China proposed on February 1, 2025 by the U.S. government, should they be implemented and sustained for an extended period of time, could have a significant adverse effect on the Company.
In February 2026, the U.S. government imposed or threatened to impose new tariffs on imported products in addition to those imposed during 2025, from countries including China and Mexico. Should these existing tariffs, or any other proposed tariffs, be implemented and sustained for an extended period of time, there could be a significant adverse effect on the Company.
Our Control Devices segment net sales decreased by 14.5% primarily as a result of decreases in our North American automotive market, including the impact of expected end of life production for certain programs as well as decreases in our China commercial vehicle market. These decreases were offset by increases in our off-highway, North American commercial vehicle and China automotive markets.
In 2025, our net sales decreased by $47.0 million, or 5.2%, while our operating loss increased to $38.6 million. Our Control Devices segment net sales decreased by 6.2% primarily because of decreases in our North American automotive market, including the impact of expected end of life production for certain programs as well as decreases in our China automotive market.
The Company intends to maintain these allowances until it is more likely than not that the deferred tax assets will be realized.
The Company intends to maintain these allowances until it is more likely than not that the deferred tax assets will be realized. Risk factors include U.S. and foreign economic conditions that affect the automotive and commercial vehicle markets in which the Company has significant operations.
Furthermore, given the current economic climate and recent fluctuations in certain commodity prices, we believe that an increase in such items could significantly affect our profitability. See Note 10 to the consolidated financial statements for additional details on the Company’s commodity price and foreign currency exchange rate risks.
Inflation and International Presence By operating internationally, we are affected by foreign currency exchange rates and the economic conditions of certain countries. Furthermore, given the current economic climate and recent fluctuations in certain commodity prices, we believe that an increase in such items could significantly affect our profitability.
Segment gross margin as a percent of sales slightly improved due to material cost improvement actions and lower required electronic component spot buy purchases being offset by an increase in overhead costs including higher warranty related expense.
Segment gross margin as a percent of sales decreased due to lower sales and higher overhead spending, including higher tariffs and business realignment costs offset by direct material cost improvement and lower quality-related costs.
This focus will provide opportunities for future growth and provide a platform to continue to rotate our local portfolio to more closely align with our global business. While we expect continued challenges across our end markets in 2025, we continue to focus on operating performance and enterprise-wide cost reduction.
Stoneridge Brazil will focus on continuing to grow our OEM capabilities in-region to better support our global customers. This focus will provide opportunities for future growth and provide a platform to continue to rotate our local portfolio to more closely align with our global business.
We remain focused on improving cash generation and the reduction of debt through efficient operating performance and targeted actions to reduce our inventory levels. Our future effective tax rate depends on various factors, such as changes in tax laws, regulations, accounting principles and our jurisdictional mix of earnings. We monitor these factors and the impact on our effective tax rate.
Our future effective tax rate depends on various factors, such as changes in tax laws, regulations, accounting principles and our jurisdictional mix of earnings. We monitor these factors and the impact on our effective tax rate. Other Matters A significant portion of our sales are outside of the United States.
The OECD implemented a 15% global corporate minimum tax to ensure that large multinational enterprises pay a minimum level of tax in the countries they operate. A number of countries have passed legislation enacting the OECD Pillar Two model rules as issued, in a modified form or not at all which is effective in 2024.
A number of countries have passed legislation enacting the OECD Pillar Two model rules as issued, in a modified form or not at all which is effective in 2024. The OECD Pillar Two framework could have a material impact on our effective tax rate and cash tax payments depending on which countries enact the legislation and in what manner.
Net loss in 2024 increased by $11.3 million, or $(0.41) per diluted share, from $5.2 million, or $(0.19) per diluted share, for the year ended December 31, 2023 primarily due to lower contribution from lower sales levels and higher interest expense offset by other income from favorable foreign exchange fluctuations and lower business realignment costs.
Net loss in 2025 increased by $86.3 million, or $(3.10) per diluted share, from $16.5 million, or $(0.60) per diluted share, for the year ended December 31, 2024 primarily due to lower contribution from lower sales levels, the impairment of fixed assets in our Control Devices segment, SG&A costs related to the Control Devices strategic alternatives, higher business realignment costs, unfavorable foreign exchange fluctuations and the recognition of a valuation allowance for U.S. federal deferred tax assets.
As outlined in Note 5 to our consolidated financial statements, the Credit Facility permits borrowing up to a maximum level of $275.0 million through November 2, 2026. The Credit Facility contains certain financial covenants that require the Company to maintain less than a maximum leverage ratio and more than a minimum interest coverage ratio.
Effective March 6, 2026, Amendment No. 3 extended the maturity of the Credit Facility through July 1, 2027. The Credit Facility contains certain financial covenants that require the Company to maintain less than a maximum leverage ratio and more than a minimum interest coverage ratio.
Operating (loss) income is summarized in the following table by reportable segment (in thousands): Year ended December 31, 2024 2023 Dollar decrease Percent decrease Control Devices $ 6,178 $ 13,582 $ (7,404) (54.5) % Electronics 25,561 27,309 (1,748) (6.4) % Stoneridge Brazil 982 4,454 (3,472) (78.0) % Unallocated corporate (33,102) (32,509) (593) (1.8) % Operating (loss) income $ (381) $ 12,836 $ (13,217) (103.0) % Our Control Devices segment operating income decreased primarily as a result of lower contribution from lower sales levels and higher SG&A due to a 2023 gain on sale of fixed assets offset by lower D&D spending.
Operating (loss) income is summarized in the following table by reportable segment (in thousands): Year ended December 31, 2025 2024 Dollar increase /(decrease) Percent increase / (decrease) Control Devices $ (17,927) $ 6,178 $ (24,105) (390.2) % Electronics 14,315 25,561 (11,246) (44.0) % Stoneridge Brazil 5,578 982 4,596 468.0 % Unallocated corporate (40,572) (33,102) (7,470) (22.6) % Operating loss $ (38,606) $ (381) $ (38,225) (10032.8) % Our Control Devices segment operating income decreased because of lower contribution from lower sales levels, the impairment of fixed assets, higher business realignment costs of $0.5 million and a non-recurring commercial settlement gain recognized in 2024 offset by lower D&D spending.
The decrease in net sales in Europe and Other was primarily due to the 2023 impact of lower customer recoveries of required electronic component spot buys of $11.7 million, and a reduction in retroactive price increases of $2.2 million and lower sales in our China commercial vehicle, European agricultural and European off-highway markets of $4.0 million, $1.4 million and $1.3 million, respectively.
The decrease in net sales in Europe and Other was primarily due to decreases in our European commercial vehicle and China automotive markets of $22.2 million and $3.3 million, respectively, offset by increases in production volumes at our customers, which resulted in sales increases in our European off-highway and China commercial vehicle markets of $4.6 million and $0.9 million, respectively.
Operating income in South America decreased because of lower contribution from lower sales levels. Our operating results in Europe and Other increased primarily because of material cost actions and lower SG&A and D&D spending offset by lower contribution from lower sales levels. Interest Expense, net. Interest expense, net increased by $1.4 million compared to 2023.
Operating income in South America increased due to higher Stoneridge Brazil OEM product sale s levels. Our operating results in Europe and Other increased because of highe r contribution from higher sales levels and lower material costs including favorable foreign exchange related variances offset by higher D&D spending as a result of lower customer reimbursements. Interest Expense, net.
Risk factors include U.S. and foreign economic conditions that affect the automotive and commercial vehicle markets of which the Company has significant operations. The Company has recognized deferred taxes related to the expected foreign currency impact upon repatriation from foreign subsidiaries not considered indefinitely reinvested.
The Company has recognized deferred taxes related to the expected foreign currency impact upon repatriation from foreign subsidiaries not considered indefinitely reinvested. Taxes of $5,869 related to China and Estonia have been accrued on undistributed earnings that are not indefinitely reinvested.
Critical Accounting Policies and Estimates The preparation of financial statements in conformity with U.S.
See Note 10 to the consolidated financial statements for additional details on the Company’s commodity price and foreign currency exchange rate risks. Critical Accounting Policies and Estimates The preparation of financial statements in conformity with U.S.
In 2025, we expect net D&D spend to slightly increase driven by spend for the development of next generation products as opposed to new product launch related spend. As a result of reduced launch activities, we expect lower customer reimbursements and capitalization of software development costs.
In 2026, we expect net D&D spend to increase driven by spend for quality improvement and the development of next generation products.
Should the tariffs be implemented, we would implement mitigation actions to reduce the impact of tariffs including but not limited to passing any incremental costs to our customers. Based on IHS Market production forecasts, the North American automotive market is expected to slightly decrease from approximately 15.4 million units in 2024 to 15.1 million units in 2025.
We have and would continue to implement mitigation actions to reduce the impact of tariffs including but not limited to passing any incremental costs to our customers. 19 Table of Contents Based on IHS Market production forecasts, in 2026 the European and North American commercial vehicle end market volumes are forecasted to increase 6.0% and 9.8%, respectively.
We expect our served market channels to remain relatively stable in 2024 based on current market and economic conditions, however our sales of in region OEM products have been lower than expected due to lower customer demand and program delays. Stoneridge Brazil will focus on continuing to grow our OEM capabilities in-region to better support our global customers.
We expect our served market channels to remain relatively stable in 2026 based on current market and economic conditions; however our sales of in-region OEM products are expected to increase in the second half of 2026 due to the launch of an awarded infotainment product.
In addition, 2024 net sales were favorably impacted by foreign currency translation of $1.4 million compared to 2023.
Net sales were also favorably impacted by foreign currency translation of $20.7 million. Cost of Goods Sold and Gross Margin. Cost of goods sold decreased compared to 2024 and our gross margin decreased to 19.9% in 2025 compared to 20.8% in 2024.
Amendment No. 1 added an additional level to the leverage ratio based pricing grid, through maturity, when the leverage ratio is greater than 3.50. As a result of Amendment No. 1, the Company was in compliance with all covenants at December 31, 2024.
Amendment No. 1 added an additional level to the leverage ratio based pricing grid, through maturity, when the leverage ratio is greater than 3.50. On November 5, 2025, the Company entered into Amendment No. 2 to the Fifth Amended and Restated Credit Agreement and Consent Agreement (“Amendment No. 2”).
Net cash used for investing activities decreased compared to the prior year due to lower capital expenditures and capitalized software development costs as well as the 2023 impact of cash proceeds from the sale of equipment. Net cash provided by financing activities decreased compared to the prior year primarily due to a decrease in Credit Facility borrowings net of repayments.
Cash used by receivables was unfavorable compared to 2024, however collection terms have remained consistent. Net cash used for investing activities decreased compared to the prior year due to lower capitalized software development costs and capital expenditures.
These decreases were offset by increases in our off-highway, North American commercial vehicle and China automotive markets of $3.7 million, $2.6 million and $2.3 million, respectively, as well as the favorable impact of negotiated price increases of $0.9 million. In addition, 2024 net sales were impacted by unfavorable foreign currency translation of $0.7 million compared to 2023.
We also experienced lower sales volumes in our North American off-highway vehicle market of $3.2 million. These decreases were partially offset by an increase in our European off-highway market of $4.6 million. Net sales in 2025 were favorably impacted by euro and Swedish krona foreign currency translation of $20.7 million compared to the prior year.
Offsetting these decreases were higher sales volumes in our European commercial vehicle market of $6.2 million, including sales related to the launches of a European OEM MirrorEye program and our next generation tachograph and higher sales in our North American off-highway and China commercial vehicle markets of $2.0 million and $1.3 million, respectively.
Our Electronics segment net sales decreased $39.6 million because of production volume decreases at our customers which resulted in sales decreases in our North American and European commercial vehicle markets of $39.0 million and $22.2 million, respectively, partially mitigated by higher MirrorEye sales, including the ramp-up of a previously launched European OEM program and two additional OEM program launches in North America, and higher aftermarket sales for our next generation tachograph.
The bank acceptance draft line of credit allowed up to a maximum borrowing level of 60.0 million Chinese yuan, or $8.5 million at December 31, 2023. There was $2.4 million utilized on the Suzhou bank acceptance draft line of credit at December 31, 2023 recorded on the consolidated balance sheet within accounts payable.
In addition, the Suzhou subsidiary has a bank acceptance draft line of credit facilitates the extension of trade payable payment terms by 180 days. The bank acceptance draft line of credit allows up to a maximum borrowing level of 30.0 million Chinese yuan, or $4.3 million at December 31, 2025.
Operating (loss) income by geographic location is summarized in the following table (in thousands): Year ended December 31, 2024 2023 Dollar increase / (decrease) Percent increase / (decrease) North America $ (28,431) $ (13,566) $ (14,865) (109.6) % South America 982 4,454 (3,472) (78.0) % Europe and Other 27,068 21,948 5,120 23.3 % Operating (loss) income $ (381) $ 12,836 $ (13,217) (103.0) % Our North American operating loss increased primarily as a result of lower contribution from lower sales levels, higher overhead spending including warranty expense, higher self-insured medical costs, wages and a 2023 gain on disposal of fixed assets, offset by lower incentive compensation due to Company performance and lower business realignment costs.
Our unallocated corporate operating loss increased due to higher SG&A from higher professional services for Control Devices strategic alternatives and higher business realignment costs of $1.9 million. 22 Table of Contents Operating (loss) income by geographic location is summarized in the following table (in thousands): Year ended December 31, 2025 2024 Dollar increase / (decrease) Percent increase / (decrease) North America $ (73,493) $ (28,431) $ (45,062) (158.5) % South America 5,578 982 4,596 468.0 % Europe and Other 29,309 27,068 2,241 8.3 % Operating loss $ (38,606) $ (381) $ (38,225) (10032.8) % Our North American operating loss increased due to lower contribution from lower sales levels and higher business realignment costs and higher SG&A spending for Control Devices offsetting lower D&D spending.
The OECD Pillar Two framework could have a material impact on our effective tax rate and cash tax payments depending on which countries enact the legislation and in what manner. 23 Table of Contents Liquidity and Capital Resources Summary of Cash Flows for the years ended December 31, 2024 and 2023 (in thousands): Year ended December 31, 2024 2023 Dollar increase / (decrease) Net cash provided by (used for): Operating activities $ 47,748 $ 4,946 $ 42,802 Investing activities (24,468) (36,979) 12,511 Financing activities 11,121 17,485 (6,364) Effect of exchange rate changes on cash and cash equivalents (3,410) 591 (4,001) Net change in cash and cash equivalents $ 30,991 $ (13,957) $ 44,948 Cash provided by operating activities increased compared to 2023 primarily due to a reduction in working capital levels.
Further, the Act is not expected to have a significant impact on the Company's 2026 consolidated financial statements, based on the guidance issued to date. 23 Table of Contents Liquidity and Capital Resources Summary of Cash Flows for the years ended December 31, 2025 and 2024 (in thousands): Year ended December 31, 2025 2024 Dollar increase / (decrease) Net cash provided by (used for): Operating activities $ 34,022 $ 47,748 $ (13,726) Investing activities (21,823) (24,468) 2,645 Financing activities (25,302) 11,121 (36,423) Effect of exchange rate changes on cash and cash equivalents 7,523 (3,410) 10,933 Net change in cash and cash equivalents $ (5,580) $ 30,991 $ (36,571) Cash provided by operating activities decreased compared to 2024 because of a higher net loss which was partially offset by cash p rovided from lower working capital levels primarily inventory and accounts payable.
Our Stoneridge Brazil segment operating income decreased primarily as a result of lower contribution from lower sales levels and adverse sales mix offset by lower SG&A because of a reduction in incentive compensation due to Company performance.
Our Electronics segment operating income decreased primarily because of lower contribution from lower sales levels and higher tariffs and higher business realignment costs of $1.4 million offset by lower D&D spending and lower SG&A from a non-recurring royalty liability adjustment. Our Stoneridge Brazil segment operating income increased due to higher contribution from higher Stoneridge Brazil OEM product sale s.
Offsetting these decreases were higher sales volumes in our European commercial vehicle market, including sales related to the launches of a European OEM MirrorEye program and our next generation tachograph as well as our China commercial vehicle and North American off-highway vehicle markets.
We also experienced lower sales volumes in our North American off-highway vehicle market. Also offsetting these decreases were higher sales volumes in our European off-highway vehicle market.
Our Electronics segment gross margin slightly improved due to material cost improvement actions and lower required electronic component spot buy purchases being offset by an increase in overhead costs including higher warranty related expense. Our Stoneridge Brazil segment gross margin decreased because of lower contribution from lower sales levels and adverse sales mix. Selling, General and Administrative.
These increases were partially offset by reduced material costs and reduced quality related costs. Our Stoneridge Brazil segment gross margin as a percent of sales decreased due to the unfavorable sales mix impact of higher OEM product sales offset by higher contribution from higher sales levels. Selling, General and Administrative.
The Company has made an accounting policy election to reflect the impact of GILTI taxes, if any, as a current period tax expense when incurred. 27 Table of Contents Recently Adopted Accounting Standards In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, “Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The guidance in ASU 2020-04 provides temporary optional expedient and exceptions to the guidance in U.S.
The Company has made an accounting policy election to reflect the impact of GILTI taxes, if any, as a current period tax expense when incurred.
Segment gross margin decreased due to lower contribution from lower sales, however, gross margin as a percentage of sales remained consistent with the prior year.
Segment gross margin decreased due to lower contribution from lower sales and higher business realignment costs.
Cost of Goods Sold and Gross Margin. Cost of goods sold decreased compared to 2023 and our gross margin increased to 20.8% in 2024 compared to 20.6% in 2023. Our material cost as a percentage of net sales de creased by 1.8% t o 57.6% in 2024 compared to 59.4% in 2023.
Our material cost as a percentage of net sales decreased by 0.8% t o 56.8% in 2025 compared to 57.6% in 2024. The decrease in material cost percentage was due to lower material costs from favorable foreign exchange and purchase related variances . Overhead as a percentage of net sales was 18.5 % and 17.0% for 2025 and 2024, respectively.
D&D costs increased by $1.1 million because of a reduction in launch activities and a shift in platform development resulting in lower customer reimbursements and capitalization of software development costs that were offset by lower consulting spending compared to 2023 for our Electronics and Control Devices segments.
SG&A expenses increased by $8.1 million compared to 2024 because of higher professional services for Control Devices strategic alternatives, business realignment costs, incentive compensation and wages which were partially offset by a non-recurring royalty liability adjustment. Design and Development. D&D costs decreased by $9.6 million from lower spending in our Control Devices and Electronics segments.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs discussed in detail in Note 10 to our consolidated financial statements, we entered into foreign currency forward contracts the purpose of which is to reduce exposure related to the Company’s future Mexican peso-denominated purchases. 28 Table of Contents We estimate that a 10.0% unidirectional change in currency exchange rates relative to the U.S dollar would have changed our income before income taxes for the year ended December 31, 2024 by approximately $2.9 million.
Biggest changeAs discussed in detail in Note 10 to our consolidated financial statements, we entered into foreign currency forward contracts the purpose of which is to reduce exposure related to the Company’s Mexican peso-denominated purchases.
As a result we are subject to translation risk because of the transactions of our foreign operations are in local currency (particularly the Brazilian real, Chinese renminbi, Mexican peso, euro, Swedish krona and Argentinian peso) and must be translated into U.S. dollars.
As a result we are subject to translation risk because of the transactions of our foreign operations are in local currency (particularly the Argentinian peso, Brazilian real, Chinese renminbi, euro, Mexican peso and Swedish krona) and must be translated into U.S. dollars.
As such, we are subject to market risk with respect to commodity price fluctuations principally related to our purchases of purchase of copper, steel, zinc, resins and certain other commodities through a combination of fixed price agreements, staggered short-term contract maturities and commercial negotiations with our suppliers and customers.
As such, we are subject to market risk with respect to commodity price fluctuations principally related to our purchases of copper, steel, zinc, resins and certain other commodities through a combination of fixed price agreements, staggered short-term contract maturities and commercial negotiations with our suppliers and customers.
In the future, if we believe that the terms of a fixed price agreement become beneficial to us, we will enter into another such instrument. We may also consider pursuing alternative commodities or alternative suppliers to mitigate this risk over a period of time. 29 Table of Contents
In the future, if we believe that the terms of a fixed price agreement become beneficial to us, we will enter into another such instrument. We may also consider pursuing alternative commodities or alternative suppliers to mitigate this risk over a period of time. 30 Table of Contents
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. Interest Rates We are exposed to interest rate risk primarily from the effects of changes in interest rates. At December 31, 2024, 100.0% of our outstanding debt was floating-rate.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. Interest Rates We are exposed to interest rate risk primarily from the effects of changes in interest rates. At December 31, 2025, 100.0% of our outstanding debt was floating-rate.
We estimate that a 1.0% change in the interest costs of our floating-rate debt outstanding as of December 31, 2024 would change interest expense on an annual basis by approximately $2.0 million. Currency Exchange Rates In addition to the United States, we have significant operations in Europe, South America, Mexico and China.
We estimate that a 1.0% change in the interest costs of our floating-rate debt outstanding as of December 31, 2025 would change interest expense on an annual basis by approximately $1.8 million. 29 Table of Contents Currency Exchange Rates In addition to the United States, we have significant operations in Europe, South America, Mexico and China.
Commodity Price Risk The competitive marketplace in which we operate may limit our ability to recover increased costs through higher prices.
We estimate that a 10.0% unidirectional change in currency exchange rates relative to the U.S dollar would have changed our income before income taxes for the year ended December 31, 2025 by approximately $3.5 million. Commodity Price Risk The competitive marketplace in which we operate may limit our ability to recover increased costs through higher prices.

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