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

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Paragraph-level year-over-year comparison of Veralto'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.

+217 added−248 removedSource: 10-K (2026-02-20) vs 10-K (2025-02-25)

Top changes in Veralto's 2025 10-K

217 paragraphs added · 248 removed · 173 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeProduct Quality & Innovation Our Product Quality & Innovation segment provides a broad set of essential solutions for brand owners and consumer packaged goods companies that enable speed to market as well as traceability and quality control of their products.
Biggest changeProduct Quality & Innovation Our Product Quality & Innovation segment provides a broad set of essential solutions that brand owners in consumer packaged goods (“CPG”), food and beverage, pharmaceutical, and industrial sectors use to support product authenticity, traceability, quality control, regulatory compliance, accelerate speed to market, and reduce material costs and waste.
Munitions List; • the Export Administration Regulations administered by the U.S. Department of Commerce, Bureau of Industry and Security, which, among other things, impose licensing requirements on the export, in-country transfer and re-export of certain dual-use goods, technology and software (which are items that have both commercial and military or proliferation applications); • the regulations administered by the U.S.
Munitions List; 9 • the Export Administration Regulations administered by the U.S. Department of Commerce, Bureau of Industry and Security, which, among other things, impose licensing requirements on the export, in-country transfer and re-export of certain dual-use goods, technology and software (which are items that have both commercial and military or proliferation applications); • the regulations administered by the U.S.
Our solutions play a central role in helping our customers convey the quality and safety of their products and build trust with consumers. Under our Videojet, Linx, Esko, X-Rite, Pantone and other globally recognized PQI brands, we provide marking and coding, and packaging and color instrumentation and related consumables.
Our solutions play a central role in helping our customers convey the quality and safety of their products and build trust with consumers. Under our Videojet, Linx, Esko, X-Rite, Pantone and other globally recognized PQI brands, we provide marking and coding, and packaging and color instrumentation, software, and related consumables.
Veralto anticipates that it will continue to make significant expenditures 8 for R&D as it seeks to provide a continuous flow of innovative products and services to maintain and improve its competitive position. For a discussion of the risks related to the need to develop and commercialize new products and product enhancements, refer to “Item 1A.
Veralto anticipates that it will continue to make significant expenditures for R&D as it seeks to provide a continuous flow of innovative products and services to maintain and improve its competitive position. For a discussion of the risks related to the need to develop and commercialize new products and product enhancements, refer to “Item 1A.
For a discussion of risks related to government contracting requirements, refer to “Item 1A. Risk Factors.” No material portion of Veralto’s business is subject to renegotiation of profits or termination of contracts at the election of a government entity.
For a discussion of risks related to government contracting requirements, refer to “Item 1A. Risk Factors.” No material portion of 8 Veralto’s business is subject to renegotiation of profits or termination of contracts at the election of a government entity.
Violations of these laws can result in various sanctions, including criminal 9 and civil penalties. Private plaintiffs also could bring civil lawsuits against us in the United States for alleged antitrust law violations, including claims for treble damages.
Violations of these laws can result in various sanctions, including criminal and civil penalties. Private plaintiffs also could bring civil lawsuits against us in the United States for alleged antitrust law violations, including claims for treble damages.
As a result, our business generates recurring sales which represented approximately 61% of total sales during the year ended December 31, 2024. Our business model also supports a strong margin profile with limited capital expenditure requirements and has generated attractive cash flows. We believe these attributes allow us to deliver financial performance that is resilient across economic cycles.
As a result, our business generates recurring sales which represented approximately 61% of total sales during the year ended December 31, 2025. Our business model also supports a strong margin profile with limited capital expenditure requirements and has generated attractive cash flows. We believe these attributes allow us to deliver financial performance that is resilient across economic cycles.
We define high-growth markets as developing markets of the world which include Asia (with the exception of Japan, Australia and New Zealand), Latin America (including Mexico), the Middle East, Eastern Europe and Africa. Our strategic investments in these markets have scaled our presence in high-growth markets to approximately 5,000 associates with 10 local manufacturing facilities.
We define high-growth markets as developing markets of the world which include Asia (with the exception of Japan, Australia and New Zealand), Latin America (including Mexico), the Middle East, Eastern Europe and Africa. Our strategic investments in these markets have scaled our presence in high-growth markets to approximately 5,000 associates with 9 local manufacturing facilities.
Risk Factors.” Government Contracts Although the substantial majority of Veralto’s revenue in 2024 was from customers other than governmental entities, Veralto has agreements relating to the sale of products to government entities. As a result, Veralto is subject to various statutes and regulations that apply to companies doing business with governments.
Risk Factors.” Government Contracts Although the substantial majority of Veralto’s revenue in 2025 was from customers other than governmental entities, Veralto has agreements relating to the sale of products to government entities. As a result, Veralto is subject to various statutes and regulations that apply to companies doing business with governments.
Veralto is headquartered in Waltham, Massachusetts with a workforce of nearly 17,000 employees (whom we refer to as “associates”) as of December 31, 2024, of whom approximately 6,500 were employed in North America, 5,000 were employed in Western Europe, 500 were employed in other developed markets and 5,000 were employed in high-growth markets.
Veralto is headquartered in Waltham, Massachusetts with a workforce of nearly 17,000 employees (whom we refer to as “associates”) as of December 31, 2025, of whom approximately 6,500 were employed in North America, 5,000 were employed in Western Europe, 500 were employed in other developed markets and 5,000 were employed in high-growth markets.
Risk Factors.” Human Capital As of December 31, 2024, Veralto had nearly 17,000 employees (whom we refer to as “associates”), of whom approximately 6,500 were employed in the North America, 5,000 were employed in Western Europe, 500 were employed in other developed markets and 5,000 were employed in high-growth markets.
Risk Factors.” Human Capital As of December 31, 2025, Veralto had nearly 17,000 employees (whom we refer to as “associates”), of whom approximately 6,500 were employed in the North America, 5,000 were employed in Western Europe, 500 were employed in other developed markets and 5,000 were employed in high-growth markets.
Refer to Note 16 to the audited Consolidated and Combined Financial Statements included in this annual report for additional information.
Refer to 10 Note 16 to the audited Consolidated and Combined Financial Statements included in this Annual Report for additional information.
Under our Hach, Trojan Technologies, ChemTreat, and other globally recognized WQ brands, we provide proprietary precision instrumentation and advanced water treatment technologies that our customers rely on to measure, analyze and treat the world’s water in residential, commercial, municipal, industrial, research and natural resource applications.
Under our Hach, Trojan Technologies, ChemTreat, and other globally recognized WQ brands, we provide proprietary precision instrumentation and advanced water treatment technologies that our customers rely on to measure, analyze and treat water in residential, commercial, municipal, industrial, research and natural resource applications.
While the price of, and global instability with respect to the supply of, oil and gas did not materially, adversely affect Veralto’s operations in 2024, Veralto is continuing to monitor the oil and gas and other commodity markets and will seek to mitigate price and/or availability risks as needed.
While the price of, and global instability with respect to the supply of, oil and gas did not materially, adversely affect Veralto’s operations in 2025, Veralto is continuing to monitor the oil and gas and other commodity markets and will seek to mitigate price and/or availability risks as needed.
Our cash flows also 4 support acquisitions to enhance our product capabilities and expansion into new and attractive markets, which we have successfully done through the acquisition of over 80 businesses over more than two decades.
Our cash flows also 4 support acquisitions to enhance our product capabilities and expansion into new and attractive markets, which we have successfully done through the acquisition of over 85 businesses over more than two decades.
TraceGains, acquired in 2024, provides leading cloud-based software solutions that enable connected data and digital workflow management to help consumer brands meet increasingly stringent compliance and reporting regulations for food and beverage safety and traceability. • X-Rite serves over 13,000 brands across 140 countries by providing color management solutions that measure the quality and consistency of color and appearance on printed packages and consumer and industrial products. • Pantone is the preeminent color standard in the design industry leveraged by more than 10 million designers, marketers and others in the creative community, not only to ensure color standardization but also to understand the impact of color on consumers.
TraceGains, acquired in 2024, provides leading cloud-based software solutions that enable connected data and digital workflow management to help consumer brands meet increasingly stringent compliance and reporting regulations for food and beverage safety and traceability. • X-Rite serves over 13,000 brands and suppliers across 140 countries by providing color management solutions that measure the quality and consistency of color and appearance on printed packages and consumer and industrial products. • Pantone is the preeminent color standard in the design industry leveraged by designers, marketers and others in the creative community, not only to ensure color standardization but also to understand the impact of color on consumers.
Due to the uncertainty regarding the duration and impact of these trends in 2025, there can be no assurance that these factors will not have an adverse impact on our business and financial statements in the future. For a further discussion of risks related to the materials and components required for Veralto’s operations, refer to “Item 1A.
Due to the uncertainty regarding the duration and impact of these trends in 2026, there can be no assurance that these factors will not have an adverse 7 impact on our business and financial statements in the future. For a further discussion of risks related to the materials and components required for Veralto’s operations, refer to “Item 1A.
Our key WQ brands provide solutions that our customers rely upon to manage critical operations involving water. • Hach, the best known of our global brands in the WQ segment, recognized for simple and reliable tests, offers analytical measurement instruments, digital solutions and related consumables that test water quality; we serve over 149,000 customers, including small community water utilities, large public and private water utilities and industrial customers and help to ensure safe water for more than 3.4 billion people every day - approximately 40% of the global population. • ChemTreat associates work alongside customers across many industries to understand their water challenges and tailor chemical treatment plans and dosing protocols to help optimize customers’ water usage and maximize reuse, and reduce water pollution; our solutions helped customers save over 85 billion gallons of water in 2024. • Trojan Technologies offers UV and membrane filtration systems for water disinfection and contaminant removal; our systems support the treatment of 13 trillion gallons of water annually and in turn help to improve access to clean water for more than 275 million people every day.
Our key WQ brands provide solutions that our customers rely upon to manage critical operations involving water. • Hach, the best known of our global brands in the WQ segment, recognized for simple and reliable tests, offers analytical measurement instruments, digital solutions and related consumables that test water quality; we serve over 149,000 customers, including small community water utilities, large public and private water utilities and industrial customers and help to ensure safe water for more than 3.4 billion people every day - approximately 40% of the global population. • ChemTreat associates work alongside customers across many industries to understand their water challenges and tailor chemical treatment plans and dosing protocols to help optimize customers’ water usage and maximize reuse, and reduce water pollution; our solutions helped customers save over 88 billion gallons of water in 2025. • Trojan Technologies offers UV and membrane filtration systems for water disinfection and contaminant removal; our systems support the treatment of 15 trillion gallons of water annually and in turn help to improve access to clean water for more than 312 million people every day.
We are continuing to work with our suppliers to understand the existing and potential future impacts of these trends on our supply chain and we continue to take actions in an effort to mitigate such impacts, including purchasing components in the open market and qualifying additional suppliers.
We are continuing to work with our suppliers to understand the existing and potential future impacts of these trends on our supply chain and we continue to take actions in an effort to mitigate such impacts, including qualifying additional suppliers.
Veralto purchases raw materials from a large number of independent sources around the world. No single supplier is material, although for some components that require particular specifications or regulatory or other qualifications there may be a single supplier or a limited number of suppliers that can readily provide such components.
Veralto purchases raw materials from a large number of independent sources around the world. No single supplier is significant to Veralto as a whole, although for some components that require particular specifications or regulatory or other qualifications there may be a single supplier or a limited number of suppliers that can readily provide such components.
We serve a broad range of customers spanning the municipal, industrial, food and beverage (“F&B”) and CPG end markets, many of which are highly regulated. We generated 48% of our 2024 sales from North America, 22% from Western Europe, 2% from other developed markets and 28% from high-growth markets. We define other developed markets as Japan, Australia and New Zealand.
We serve a broad range of customers spanning the municipal, industrial, food and beverage (“F&B”) and CPG end markets, many of which are highly regulated. We generated 48% of our 2025 sales from North America, 23% from Western Europe, 2% from other developed markets and 27% from high-growth markets. We define other developed markets as Japan, Australia and New Zealand.
Veralto distributes approximately 23% of its technology and equipment products through third-party distributors. No individual customer accounted for more than 10% of combined sales in 2024, 2023 or 2022. Acquisition Activities Veralto views acquisitions as a key part of its growth strategy.
Veralto distributes approximately 18% of its technology and equipment products through third-party distributors. No individual customer accounted for more than 10% of sales in 2025, 2024 or 2023. Acquisition Activities Veralto views acquisitions as a key part of its growth strategy.
Sales and Distribution In 2024, Veralto generated $5.2 billion in sales derived from a business mix that is highly diversified by geography and end-market.
Sales and Distribution In 2025, Veralto generated $5.5 billion in sales derived from a business mix that is highly diversified by geography and end-market.
Risk Factors.” International Operations Veralto’s products and services are available worldwide, and its principal markets outside the United States are in Europe, Asia and Latin America. In 2024, Veralto generated 48% of its sales in North America, 22% of its sales in Western Europe, 2% of its sales in other developed markets and 28% of its sales in high-growth markets.
Risk Factors.” International Operations Veralto’s products and services are available worldwide, and its principal markets outside the United States are in Europe, Asia and Latin America. In 2025, Veralto generated 48% of its sales in North America, 23% of its sales in Western Europe, 2% of its sales in other developed markets and 27% of its sales in high-growth markets.
As of December 31, 2024, Veralto had facilities in approximately 50 countries, including approximately 58 principal administrative, sales, research and development, manufacturing and distribution facilities. 22 of these facilities are located in the United 10 States in 12 states and 36 are located outside the United States, primarily in Europe and to a lesser extent in Latin America, Asia and Canada.
As of December 31, 2025, Veralto had facilities in approximately 50 countries, including approximately 60 principal administrative, sales, research and development, manufacturing and distribution facilities. 21 of these facilities are located in the United States in 12 states and 39 are located outside the United States, primarily in Europe and to a lesser extent in Latin America, Asia and Canada.
Through the application of VES tools and processes (including the implementation of price increases), Veralto largely mitigated the impact of these pressures on Veralto’s profitability and as a result these pressures did not have a material, adverse effect on the business in 2024. These pressures continue to varying degrees as of the date of this annual report.
Veralto largely mitigated the impact of these pressures on Veralto’s profitability and as a result these headwinds did not have a material, adverse effect on the business in 2025. These pressures continue to varying degrees as of the date of this Annual Report.
Veralto utilizes a number of techniques to address potential disruption in and other risks relating to its supply chain, including in certain cases the use of safety stock, alternative materials and qualification of multiple supply sources. The supply chain disruptions, labor availability constraints, and labor cost increases that began in 2021 for a number of our businesses eased in 2024.
Veralto utilizes a number of techniques to address potential disruption and other risks relating to its supply chain, including in certain cases the use of safety stock, alternative materials and qualification of multiple supply sources.
For example: ◦ Our WQ segment offers products and services that enable municipalities to deliver clean water while helping industrial customers to be good stewards of water in their processes. ◦ Our PQI segment allows brands to drive consumer transparency, measure and reduce packaging waste, and accelerate time-to-market for new packaging innovations. 6 • Our leadership has conducted a sustainability prioritization assessment to inform our sustainability priorities. • Informed by our prioritization assessment, we intend to set and communicate additional public sustainability goals and we expect to rigorously track our progress towards achieving those goals. • Our sustainability program is organized around the three pillars of Products, Planet, and People.
For example: ◦ Our WQ segment offers products and services that enable municipalities to deliver clean water while helping industrial customers to be good stewards of water in their processes. 6 ◦ Our PQI segment helps our customers safeguard everyday essentials by protecting the food supply chain, ensuring product quality, freshness, and consistency, while maintaining brand authenticity. • Our leadership has conducted a sustainability prioritization assessment to inform our sustainability priorities. • Informed by our prioritization assessment, we intend to set and communicate additional public sustainability goals and we expect to rigorously track our progress towards achieving those goals. • Our sustainability program is organized around the three pillars of Products, Planet, and People.
Our solutions help ensure transparency, safety, authenticity, tracking and traceability of an estimated more than 10 billion codes printed around the world daily. • Esko facilitates the creation of new packaging designs through design software and imaging systems. Esko’s offerings are used by over 25,000 established and emerging brands and their suppliers in over 140 countries.
Printing billions of codes a day, our solutions help ensure transparency, safety, authenticity, tracking and traceability throughout the global supply chain. • Esko facilitates the creation of new packaging designs through design software and imaging systems. Esko’s offerings are extensively used by established and emerging brands and their suppliers, with over 25,000 customers in over 140 countries.
We estimate that 80% of the top 25 global consumer packaged goods (“CPG”) brands (based on 2024 revenues) and a majority of the top 20 pharmaceutical brands 5 (based on 2024 revenues) use PQI’s solutions, enabling confidence and trust in the brands and products consumers use daily.
We serve a majority of the 5 top 25 global CPG brands and a majority of the top 20 pharmaceutical brands use PQI’s solutions, enabling confidence and trust in the brands and products consumers use daily.
For a discussion of risks related to Veralto’s operations as a result of global military conflicts, refer to “Item 1A. Risk Factors.” Intellectual Property Veralto owns numerous patents, trademarks, copyrights, trade secrets and licenses to intellectual property owned by others.
Risk Factors.” Intellectual Property Veralto owns numerous patents, trademarks, copyrights, trade secrets and licenses to intellectual property owned by others.
In particular: • At our core, the products and services we provide underscore our commitment to advancing broad sustainability objectives for our customers.
In particular: • At our core, the products and services we offer are directly linked to the sustainability objectives of many of our customers.
Removed
Risk Factors.” 7 Global Military Conflicts In 2022, Veralto suspended the shipment of products to Russia. In the first quarter of 2022, Veralto recorded a pretax charge of $1 million, primarily related to the impairment of accounts receivable and inventory related to Russian operations.
Added
Throughout the course of 2025, Veralto has taken substantial actions through the application of VES tools and processes to actively address the impact of various tariffs applied by the U.S. government and reciprocal tariffs from other trading partners.
Removed
Russia has significantly reduced the export of natural gas to Europe, creating uncertainty on natural gas prices and a reduced supply of natural gas. If this trend continues, Veralto’s European manufacturing facilities could face increased costs and risks of production disruptions.
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Veralto’s European customers and suppliers could experience similar adverse impacts, which could further adversely impact Veralto’s supply chain and also adversely impact the demand for its products. Veralto will continue monitoring the military, social, political, regulatory and economic environment and its broader impacts, and will consider further actions as appropriate.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeTransactions such as these involve a number of financial, accounting, managerial, operational, legal, compliance and other risks and challenges, including but not limited to the following, any of which can adversely affect our business and our financial statements: • businesses, technologies, services and products that we acquire or invest in have sometimes under-performed relative to our expectations and the price that we paid, failed to perform in accordance with our anticipated timetable or failed to achieve and/or sustain profitability; • we may incur or assume significant debt in connection with our acquisitions, investments, joint ventures or strategic relationships, which can also cause a deterioration of Veralto’s credit ratings, result in increased borrowing costs and interest expense and diminish our future access to the capital markets; • acquisitions, investments, joint ventures or strategic relationships can cause our financial results to differ from our own or the investment community’s expectations in any given period, or over the long-term; • pre-closing and post-closing earnings charges can adversely impact our results in any given period, and the impact may be substantially different period-to-period; • acquisitions, investments, joint ventures or strategic relationships can create demands on our management, operational resources and financial and internal control systems that we are unable to effectively address; • we can experience difficulty in integrating cultures, personnel, operations and financial and other controls and systems and retaining key employees and customers, and former employees of our existing businesses or businesses we acquire can sometimes compete with us; • we are not always able to achieve cost savings or other synergies anticipated in connection with acquisitions, investments, joint ventures or strategic relationships; • we have assumed and may assume unknown liabilities, known contingent liabilities that become realized, known liabilities that prove greater than anticipated, internal control deficiencies or exposure to regulatory sanctions resulting from the acquired company’s or investee’s activities; and the realization of any of these liabilities or deficiencies can increase our expenses, adversely affect our financial position or cause us to fail to meet our public financial reporting obligations; 14 • in connection with acquisitions and joint ventures, we may enter into post-closing financial arrangements such as purchase price adjustments, earn-out obligations and indemnification obligations, which can have unpredictable financial results; • as a result of our acquisitions and investments, we have recorded significant goodwill and other assets on our balance sheet and if we are not able to realize the value of these assets, or if the value of our investments declines, we may be required to incur impairment charges; • divestitures or other dispositions can dilute the Company’s earnings per share, have other adverse financial, tax and accounting impacts and distract management, and disputes can arise with the new owners of a divested/disposed business; • we may have interests that diverge from those of our joint venture partners or other strategic partners or the companies we invest in, and we are not always able to direct or influence the management and operations of the joint venture, other strategic relationship or investee in the manner we believe is most appropriate, exposing us to additional risk; and • investing in or making loans to early-stage companies often entails a high degree of risk, including uncertainty regarding the company’s ability to successfully develop new technologies and services, bring these new technologies and services to market and gain market acceptance, maintain adequate capitalization and access to cash or other forms of liquidity, and retain critical management personnel; we do not always achieve the strategic, technological, financial or commercial benefits we anticipate; we may lose our investment or fail to recoup our loan; or our investment may be illiquid for a greater-than-expected period of time.
Biggest changeTransactions such as these involve a number of financial, accounting, managerial, operational, legal, compliance and other risks and challenges, including but not limited to the following, any of which can adversely affect our business and our financial statements: • businesses, technologies, services and products that we acquire or invest in have sometimes under-performed relative to our expectations and the price that we paid, failed to perform in accordance with our anticipated timetable or failed to achieve and/or sustain profitability; 14 • we may incur or assume significant debt in connection with our acquisitions, investments, joint ventures or strategic relationships, which can also cause a deterioration of Veralto’s credit ratings, result in increased borrowing costs and interest expense and diminish our future access to the capital markets; • acquisitions, investments, joint ventures or strategic relationships can cause our financial results to differ from our own or the investment community’s expectations in any given period, or over the long-term; • we can experience difficulty in integrating cultures, personnel, operations and financial and other controls and systems and retaining key employees and customers, and former employees of our existing businesses or businesses we acquire can sometimes compete with us; • we are not always able to achieve cost savings or other synergies anticipated in connection with acquisitions, investments, joint ventures or strategic relationships; • we have assumed and may assume unknown liabilities, known contingent liabilities that become realized, known liabilities that prove greater than anticipated, internal control deficiencies or exposure to regulatory sanctions resulting from the acquired company’s or investee’s activities; and the realization of any of these liabilities or deficiencies can increase our expenses, adversely affect our financial position or cause us to fail to meet our public financial reporting obligations; • as a result of our acquisitions and investments, we have recorded significant goodwill and other assets on our balance sheet and if we are not able to realize the value of these assets, or if the value of our investments declines, we may be required to incur impairment charges; • divestitures or other dispositions can dilute the Company’s earnings per share, have other adverse financial, tax and accounting impacts and distract management, and disputes can arise with the new owners of a divested/disposed business; • we may have interests that diverge from those of our joint venture partners or other strategic partners or the companies we invest in, and we are not always able to direct or influence the management and operations of the joint venture, other strategic relationship or investee in the manner we believe is most appropriate, exposing us to additional risk; and • investing in or making loans to early-stage companies often entails a high degree of risk, including uncertainty regarding the company’s ability to successfully develop new technologies and services, bring these new technologies and services to market and gain market acceptance, maintain adequate capitalization and access to cash or other forms of liquidity, and retain critical management personnel; we do not always achieve the strategic, technological, financial or commercial benefits we anticipate; we may lose our investment or fail to recoup our loan; or our investment may be illiquid for a greater-than-expected period of time.
Our success depends on several factors, including our ability to: • correctly identify customer needs and preferences and predict future needs and preferences; • allocate our R&D funding to products and services with higher growth prospects; • anticipate and respond to our competitors’ development of new products and services and technological innovations; • differentiate our offerings from our competitors’ offerings and avoid commoditization; • innovate and develop new technologies and applications, and acquire or obtain rights to third-party technologies that may have valuable applications in our served markets; • obtain adequate intellectual property rights with respect to key technologies before our competitors do; • successfully commercialize new technologies in a timely manner, price them competitively and cost-effectively manufacture and deliver sufficient volumes of new products of appropriate quality on time; • obtain necessary regulatory approvals of appropriate scope; and • stimulate customer demand for and convince customers to adopt new technologies.
Our success depends on several factors, including our ability to: • correctly identify customer needs and preferences and predict future needs and preferences; • allocate our R&D funding to products and services with higher growth prospects; • anticipate and respond to our competitors’ development of new products and services and technological innovations; • differentiate our offerings from our competitors’ offerings and avoid commoditization; • innovate and develop new technologies and applications, and acquire or obtain rights to third-party technologies that may have valuable applications in our served markets; • obtain adequate intellectual property rights with respect to key technologies before our competitors do; • successfully commercialize new technologies in a timely manner, price them competitively and cost-effectively manufacture and deliver sufficient volumes of new products of appropriate quality on time; • obtain necessary regulatory approvals of appropriate scope; and 12 • stimulate customer demand for and convince customers to adopt new technologies.
In addition to the environmental, health, safety, anticorruption, data privacy and other regulations noted elsewhere in this Annual Report, our businesses are subject to extensive regulation by U.S. and non-U.S. governmental and self-regulatory entities at the supranational, federal, state, local and other jurisdictional levels, including for example the following: 20 • We are required to comply with various import laws and export control and economic sanctions laws, which may affect our transactions with certain customers, business partners and other persons and dealings between our employees and between our subsidiaries.
In addition to the environmental, health, safety, anticorruption, data privacy and other regulations noted elsewhere in this Annual Report, our businesses are subject to extensive regulation by U.S. and non-U.S. governmental and self-regulatory entities at the supranational, federal, state, local and other jurisdictional levels, including for example the following: • We are required to comply with various import laws and export control and economic sanctions laws, which may affect our transactions with certain customers, business partners and other persons and dealings between our employees and between our subsidiaries.
Any or all of these problems can result in the loss of customers or cost inefficiencies, provide an opportunity for competing products to gain market acceptance and otherwise adversely affect our business and financial statements. 17 Our success depends on our ability to recruit, retain and motivate talented employees representing diverse backgrounds, experiences and skill sets.
Any or all of these problems can result in the loss of customers or cost inefficiencies, provide an opportunity for competing products to gain market acceptance and otherwise adversely affect our business and financial statements. Our success depends on our ability to recruit, retain and motivate talented employees representing diverse backgrounds, experiences and skill sets.
Security breaches of systems provided or enabled by us, regardless of whether the breach is attributable to a vulnerability in our products or services, or security breaches of third-party suppliers we rely on to process, store or transmit electronic information, can result in the misappropriation, destruction or unauthorized disclosure of confidential information or personal data belonging to us or to our employees, partners, customers or suppliers.
Security breaches of systems provided or enabled by us, regardless of whether the breach is attributable to a vulnerability in our products or services, or security breaches of third-party suppliers we rely on to process, store or transmit electronic information, 15 can result in the misappropriation, destruction or unauthorized disclosure of confidential information or personal data belonging to us or to our employees, partners, customers or suppliers.
Even when we successfully innovate and develop new and enhanced 12 products and services, we often incur substantial costs in doing so, and our profitability may suffer. In addition, promising new offerings may fail to reach the market or realize only limited commercial success because of real or perceived efficacy or safety concerns.
Even when we successfully innovate and develop new and enhanced products and services, we often incur substantial costs in doing so, and our profitability may suffer. In addition, promising new offerings may fail to reach the market or realize only limited commercial success because of real or perceived efficacy or safety concerns.
Our profitability could also be adversely impacted if we are unable to adjust our purchases to reflect changes in customer demand and market fluctuations, including those caused by seasonality or cyclicality. During a market upturn, suppliers from time to time extend lead times, limit supplies or increase prices.
Our profitability could also be adversely impacted if we are unable to adjust our purchases to reflect changes in customer demand and market fluctuations, including those caused by seasonality or cyclicality. During a market 17 upturn, suppliers from time to time extend lead times, limit supplies or increase prices.
Disputes or litigations regarding intellectual property can be costly and time-consuming to defend due to the complexity of many of our technologies and the uncertainty of intellectual property litigation. Our intellectual property portfolio may not be useful in asserting a counterclaim, or negotiating a license, in response to a claim of infringement or misappropriation.
Disputes or litigations regarding intellectual property can be costly and time-consuming to defend due to the complexity of many of our technologies and the uncertainty of intellectual property litigation. Our intellectual property portfolio may not be useful in 18 asserting a counterclaim, or negotiating a license, in response to a claim of infringement or misappropriation.
In addition, in certain of our businesses demand depends on customers’ capital spending budgets as well as government funding policies, and matters of 13 public policy and government budget dynamics as well as product and economic cycles can affect the spending decisions of these entities.
In addition, in certain of our businesses demand depends on customers’ capital spending budgets as well as government funding policies, and matters of public policy and government budget dynamics as well as product and economic cycles can affect the spending decisions of these entities.
Veralto’s amended and restated certificate of incorporation provides that, unless Veralto consents otherwise, the state courts in the State of Delaware or, if no state court located within the State of Delaware has jurisdiction, the federal court for the District of Delaware, will be the sole and exclusive forum for any derivative action or proceeding brought on behalf of Veralto, any action asserting a claim of breach of a fiduciary duty owed by any of Veralto’s directors, officers, employees or stockholders to Veralto or Veralto’s stockholders, any action asserting a claim arising pursuant to any provision of the DGCL or Veralto’s amended and restated certificate of incorporation or bylaws, or any action asserting a claim governed by the internal affairs doctrine.
Veralto’s certificate of incorporation provides that, unless Veralto consents otherwise, the state courts in the State of Delaware or, if no state court located within the State of Delaware has jurisdiction, the federal court for the District of Delaware, will be the sole and exclusive forum for any derivative action or proceeding brought on behalf of Veralto, any action asserting a claim of breach of a fiduciary duty owed by any of Veralto’s directors, officers, employees or stockholders to Veralto or Veralto’s stockholders, any action asserting a claim arising pursuant to any provision of the DGCL or Veralto’s certificate of incorporation or bylaws, or any action asserting a claim governed by the internal affairs doctrine.
We also from time to time become subject to lawsuits as a result of acquisitions or 21 as a result of liabilities retained from, or representations, warranties or indemnities provided in connection with, businesses divested by us or our predecessors.
We also from time to time become subject to lawsuits as a result of acquisitions or as a result of liabilities retained from, or representations, warranties or indemnities provided in connection with, businesses divested by us or our predecessors.
Sales and earnings of our non-U.S. businesses are also translated into U.S. dollars for reporting purposes and the strengthening of the U.S. dollar generally results in unfavorable translation effects.
Sales and earnings of our non-U.S. businesses are also translated into U.S. dollars for 19 reporting purposes and the strengthening of the U.S. dollar generally results in unfavorable translation effects.
However, based on the information we have as of the date of this Annual Report we do not believe that it is reasonably possible that any amounts we may be required to pay in connection with environmental matters in excess of our reserves as of December 31, 2024, will have a material effect on our business or financial statements.
However, based on the information we have as of the date of this Annual Report we do not believe that it is reasonably possible that any amounts we may be required to pay in connection with environmental matters in excess of our reserves as of December 31, 2025, will have a material effect on our business or financial statements.
We have established policies and procedures designed to ensure compliance with such laws and regulations but there can be no assurance that the policies and procedures have prevented and will prevent violations of these regulations, and any such violation can adversely affect our business and financial statements. • We also have agreements to sell products and services to government entities (as well as agreements relating to government financing, as discussed above) and are subject to various statutes and regulations that apply to companies doing business with government entities (less than 2% of our 2024 sales were made to the U.S. federal government).
We have established policies and procedures designed to ensure compliance with such laws and regulations but there can be no assurance that the policies and procedures have prevented and will prevent violations of these regulations, and any such violation can adversely affect our business and financial statements. 20 • We also have agreements to sell products and services to government entities (as well as agreements relating to government financing, as discussed above) and are subject to various statutes and regulations that apply to companies doing business with government entities (less than 2% of our 2025 sales were made to the U.S. federal government).
Our financial results are subject to fluctuations in the cost and availability of the supplies that we use in and the labor we need for our operations. Prices for and availability of the components, raw materials and other commodities we use in our business, as well as for labor, have fluctuated significantly in the past, including during 2024.
Our financial results are subject to fluctuations in the cost and availability of the supplies that we use in and the labor we need for our operations. Prices for and availability of the components, raw materials and other commodities we use in our business, as well as for labor, have fluctuated significantly in the past, including during 2025.
However, based on our experience, information and applicable law as of the date of this Annual Report, we do not believe that it is reasonably possible that any amounts we may be required to pay in connection with litigation and other legal and regulatory proceedings in excess of our reserves as of December 31, 2024 will have a material effect on our business or financial statements.
However, based on our experience, information and applicable law as of the date of this Annual Report, we do not believe that it is reasonably possible that any amounts we may be required to pay in connection with litigation and other legal 21 and regulatory proceedings in excess of our reserves as of December 31, 2025 will have a material effect on our business or financial statements.
Please see “Item 1. Business-Materials” for a discussion of the inputs we use in our business, supply chain and labor availability disruptions and constraints our businesses have faced and are facing, and the adverse impacts that we have incurred and may incur relating thereto.
Please see “Item 1. Business” for a discussion of the inputs we use in our business, supply chain and labor availability disruptions and constraints our businesses have faced and are facing, and the adverse impacts that we have incurred and may incur relating thereto.
Our non-U.S. business (and particularly our business in high-growth markets) is subject to risks that include: • interruption in the transportation of supplies to us and finished goods to our customers; • differences in terms of sale, including longer payment terms than are typical in the U.S.; • local product preferences or requirements; • changes in a country’s or region’s political, legal, social, compliance, business or economic conditions, such as the devaluation of particular currencies; • trade protection measures, tariffs, embargoes and import or export restrictions and requirements; • unexpected changes in laws or regulatory requirements, including changes in tax laws; • capital controls and limitations on ownership and on repatriation of earnings and cash; • the potential for nationalization of enterprises; • complex data privacy and cybersecurity requirements; • limitations on legal rights and our ability to enforce such rights, including differing protection of intellectual property; • difficulty in staffing and managing widespread operations; • workforce instability and differing labor or employment regulations; • difficulties in implementing restructuring actions on a timely or comprehensive basis; • greater uncertainty, risk, expense and delay in commercializing products in certain foreign jurisdictions, including with respect to product and other regulatory approvals; • geopolitical instability arising from or related to military conflicts; • public health crises and epidemics; and • remaining uncertainties relating to the impact of the UK’s exit from the EU.
Our non-U.S. business (and particularly our business in high-growth markets) is subject to risks that include: • interruption in the transportation of supplies to us and finished goods to our customers; • differences in terms of sale, including longer payment terms than are typical in the U.S.; • local product preferences or requirements; • changes in a country’s or region’s political, legal, social, compliance, business or economic conditions, such as the devaluation of particular currencies; • trade protection measures, tariffs, embargoes and import or export restrictions and requirements; • unexpected changes in laws or regulatory requirements, including changes in tax laws; • capital controls and limitations on ownership and on repatriation of earnings and cash; • the potential for nationalization of enterprises; • complex data privacy and cybersecurity requirements; • limitations on legal rights and our ability to enforce such rights, including differing protection of intellectual property; 13 • difficulty in staffing and managing widespread operations; • workforce instability and differing labor or employment regulations; • difficulties in implementing restructuring actions on a timely or comprehensive basis; • greater uncertainty, risk, expense and delay in commercializing products in certain foreign jurisdictions, including with respect to product and other regulatory approvals; • geopolitical instability arising from or related to military conflicts; and • public health crises and epidemics.
These provisions may also prevent or discourage attempts to remove and replace incumbent directors. The forum selection provisions under Veralto’s amended and restated certificate of incorporation could discourage lawsuits against Veralto and Veralto’s directors, officers, employees and stockholders.
These provisions may also prevent or discourage attempts to remove and replace incumbent directors. The forum selection provisions under Veralto’s certificate of incorporation could discourage lawsuits against Veralto and Veralto’s directors, officers, employees and stockholders.
Certain provisions in Veralto’s amended and restated certificate of incorporation and bylaws, and of Delaware law, may prevent or delay an acquisition of Veralto, which could decrease the trading price of Veralto’s common stock.
Certain provisions in Veralto’s certificate of incorporation and bylaws, and of Delaware law, may prevent or delay an acquisition of Veralto, which could decrease the trading price of Veralto’s common stock.
Veralto’s amended and restated certificate of incorporation and amended and restated bylaws contain, and Delaware law contains, provisions that are intended to deter coercive takeover practices and inadequate takeover 22 bids and to encourage prospective acquirers to negotiate with the Board rather than to attempt an unsolicited takeover not approved by the Board.
Veralto’s certificate of incorporation and bylaws contain, and Delaware law contains, provisions that are intended to deter coercive takeover practices and inadequate takeover bids and to encourage prospective acquirers to negotiate with the Board rather than to attempt an unsolicited takeover not approved by the Board.
Our existing and future indebtedness may limit our operations and our use of our cash flow and negatively impact our credit ratings; and any failure to comply with the covenants that apply to our indebtedness could adversely affect our business and financial statements. As of December 31, 2024, we had approximately $2.6 billion in outstanding indebtedness.
Our existing and future indebtedness may limit our operations and our use of our cash flow and negatively impact our credit ratings; and any failure to comply with the covenants that apply to our indebtedness could adversely affect our business and financial statements. As of December 31, 2025, we had approximately $2.7 billion in outstanding indebtedness.
Slower economic growth in the domestic and/or international markets, inflation, actual or anticipated default on sovereign debt, volatility in the currency and credit markets, military conflicts, high levels of unemployment or underemployment, labor availability constraints, reduced levels of capital expenditures, changes or anticipation of potential changes in government trade and tariff, fiscal, tax and monetary policies, changes in capital requirements for financial institutions, government budget negotiation dynamics, sequestration, austerity measures and other challenges that affect economies of the world have in the past adversely affected, and may in the future adversely affect, the Company and its distributors, customers and suppliers, including having the effect of: • reducing demand for our products and services (in this Annual Report, references to products and services also includes software), limiting the financing available to our customers and suppliers, increasing order cancellations, resulting in longer sales cycles and slower adoption of new technologies; • suspending sales prohibited by sanctions, embargoes, regional instability, geopolitical shifts and adverse impacts arising from or related to military conflicts; • increasing the difficulty in collecting accounts receivable and the risk of excess and obsolete inventories; • increasing price competition in our served markets; • supply interruptions, delays or cost increases, which can disrupt our ability to produce or deliver our products and/or increase our costs; • increasing the risk of impairment of goodwill and other long-lived assets, and the risk that we may not be able to fully recover the value of other assets such as real estate and tax assets; • increasing the risk that counterparties to our contractual arrangements will become insolvent or otherwise unable to fulfill their contractual obligations which, in addition to increasing the risks identified above, could result in preference actions against us; and • adversely impacting market sizes and growth rates. 11 If growth in any key economy of the world or in any of the markets we serve slows for a significant period, if there is significant deterioration in any such economy or such markets or if economic improvements do not benefit the markets we serve, our business and financial statements can be adversely affected.
Slower economic growth in the domestic and/or international markets, inflation, actual or anticipated default on sovereign debt, volatility in the currency and credit markets, military conflicts, high levels of unemployment or underemployment, labor availability constraints, reduced levels of capital expenditures, changes or anticipation of potential changes in government trade and tariff, fiscal, tax and monetary policies, changes in capital requirements for financial institutions, government budget negotiation dynamics, sequestration, austerity measures and other challenges that affect economies of the world have in the past adversely affected, and may in the future adversely affect, the Company and its distributors, customers and suppliers, including having the effect of: • reducing demand for our products and services (in this Annual Report, references to products and services also includes software), limiting the financing available to our customers and suppliers, increasing order cancellations, resulting in longer sales cycles and slower adoption of new technologies; • suspending sales prohibited by sanctions, embargoes, regional instability, geopolitical shifts and adverse impacts arising from or related to military conflicts; • increasing the difficulty in collecting accounts receivable and the risk of excess and obsolete inventories; • increasing price competition in our served markets; • supply interruptions, delays or cost increases, which can disrupt our ability to produce or deliver our products and/or increase our costs; • increasing the risk of impairment of goodwill and other long-lived assets, and the risk that we may not be able to fully recover the value of other assets such as real estate and tax assets; • increasing the risk that counterparties to our contractual arrangements will become insolvent or otherwise unable to fulfill their contractual obligations which, in addition to increasing the risks identified above, could result in preference actions against us; and • adversely impacting market sizes and growth rates.
The market for highly skilled workers and leaders in our industries, particularly in the areas of science and technology, is extremely competitive and expectations from qualified talent in many areas of the labor market have evolved and escalated recently. In addition, in 2024 we faced labor availability constraints and labor cost inflation in certain areas of our business.
The market for highly skilled workers and leaders in our industries, particularly in the areas of science and technology, is extremely competitive and expectations from qualified talent in many areas of the labor market have evolved and escalated recently. In addition, in 2025 we faced labor availability challenges and labor cost inflation in certain areas of our business.
If we add new debt in the future, the risks described above would increase. 19 We may be required to recognize impairment charges for our goodwill and other intangible assets. As of December 31, 2024, the net carrying value of our goodwill and other intangible assets totaled approximately $3.2 billion.
If we add new debt in the future, the risks described above would increase. We may be required to recognize impairment charges for our goodwill and other intangible assets. As of December 31, 2025, the net carrying value of our goodwill and other intangible assets totaled approximately $3.4 billion.
The maximum consolidated net leverage ratio will be increased to 4.25:1.00 for the four consecutive full fiscal quarters immediately following the consummation of any material acquisition by us.
The maximum consolidated net leverage ratio will be increased to 4.25 to 1.00 for the four consecutive full fiscal quarters immediately following the consummation of any material acquisition (as defined by the credit facilities) by us.
Tax Cuts and Jobs Act (“TCJA”)), the ambiguity of tax laws and regulations, the subjectivity of factual interpretations, the complexity of our intercompany arrangements, uncertainties regarding the geographic mix of earnings in any particular period, and other factors, our estimates of effective tax rate and income tax assets and liabilities can be incorrect and our financial statements could be adversely affected.
Tax Cuts and Jobs Act (“TCJA”) or the One Big Beautiful Bill Act (“OBBBA”)), the ambiguity of tax laws and regulations, the subjectivity of factual interpretations, the complexity of our intercompany arrangements, uncertainties regarding the geographic mix of earnings in any particular period, and other factors, our estimates of effective tax rate and income tax assets and liabilities can be incorrect and our financial statements could be adversely affected.
Veralto’s amended restated certificate of 23 incorporation further provides that, unless Veralto consents otherwise, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.
Veralto’s amended restated certificate of incorporation further provides that, unless Veralto consents otherwise, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act. ITEM 1B. UNRESOLVED STAFF COMMENTS None.
These provisions include, among others: • the inability of Veralto’s stockholders to call a special meeting; • the inability of Veralto’s stockholders to act by written consent; • rules regarding how stockholders may present proposals or nominate directors for election at stockholder meetings; • the right of the Board to issue preferred stock without stockholder approval; • the division of the Board into three classes of directors, with each class serving a staggered three-year term, and this classified board provision could have the effect of making the replacement of incumbent directors more time consuming and difficult; • a provision that stockholders may only remove directors with cause; • the ability of Veralto’s directors, and not stockholders, to fill vacancies (including those resulting from an enlargement of the Board) on the Board; and • the requirement that the affirmative vote of stockholders holding at least 66-2/3% of Veralto’s voting stock is required to amend Veralto’s amended and restated bylaws and certain provisions in Veralto’s amended and restated certificate of incorporation.
These provisions include, among others: • the inability of Veralto’s stockholders to call a special meeting; • the inability of Veralto’s stockholders to act by written consent; • rules regarding how stockholders may present proposals or nominate directors for election at stockholder meetings; • the right of the Board to issue preferred stock without stockholder approval; • the division of the Board into three classes of directors, which could have the effect of making the replacement of incumbent directors more time consuming and difficult; • the ability of Veralto’s directors, and not stockholders, to fill vacancies (including those resulting from an enlargement of the Board) on the Board; and • the requirement that the affirmative vote of stockholders holding at least 66-2/3% of Veralto’s voting stock is required to amend Veralto’s bylaws and certain provisions in Veralto’s certificate of incorporation. 22 In addition, because Veralto has not chosen to be exempt from Section 203 of the Delaware General Corporation Law (the “DGCL”), this provision could also delay or prevent a change of control that you may favor.
Our liability insurance may not be sufficient in type or amount to cover us against claims related to security breaches, cyber-attacks and other related breaches. 15 In addition, our information technology systems require an ongoing commitment of significant resources to maintain and enhance existing systems and develop new systems to keep pace with continuing changes in information processing technology, evolving legal and regulatory standards, evolving customer expectations, changes in the techniques used to obtain unauthorized access to data and information systems, and the information technology needs associated with our changing products and services.
In addition, our information technology systems require an ongoing commitment of significant resources to maintain and enhance existing systems and develop new systems to keep pace with continuing changes in information processing technology, evolving legal and regulatory standards, evolving customer expectations, changes in the techniques used to obtain unauthorized access to data and information systems, and the information technology needs associated with our changing products and services.
The third-party insurance coverage that we maintain varies from time to time in both type and amount depending on cost, availability and our decisions regarding risk retention, and may be unavailable or insufficient to protect us against such losses. 16 Climate change and sustainability matters, legal or regulatory measures to address climate change and sustainability matters, and any inability on our part to address related stakeholder expectations may negatively affect us.
The third-party insurance coverage that we maintain varies from time to time in both type and amount depending on cost, availability and our decisions regarding risk retention, and may be unavailable or insufficient to protect us against such losses.
Any of the above can result in the discontinuation of sale of such products in one or more countries and give rise to claims for damages from persons who believe they have been injured as a result of product issues, including claims by individuals or groups seeking to represent a class.
Any of the above can result in the discontinuation of sale of such products in one or more countries and give rise to claims for damages from persons who believe they have been injured as a result of product issues, including claims by individuals or groups seeking to represent a class. 16 If we suffer loss to our facilities, supply chains, distribution systems or information technology systems due to catastrophe or other events, our operations could be seriously harmed.
Even if we successfully defend against claims of infringement or misappropriation, we may incur significant costs and diversion of management attention and resources, which could adversely affect our business and financial statements. Financial and Tax Risks Our outstanding debt has increased significantly as a result of our separation from Danaher, and we may incur additional debt in the future.
Even if we successfully defend against claims of infringement or misappropriation, we may incur significant costs and diversion of management attention and resources, which could adversely affect our business and financial statements. Financial and Tax Risks We have incurred a significant amount of debt, and our debt may continue to increase.
We own numerous patents, trademarks, copyrights, trade secrets and other intellectual property and licenses to intellectual property owned by others, which in aggregate are important to our business.
These risks are particularly pronounced in countries in which we do business that do not have levels of protection of intellectual property comparable to the United States. We own numerous patents, trademarks, copyrights, trade secrets and other intellectual property and licenses to intellectual property owned by others, which in aggregate are important to our business.
In addition, the steps that we and our licensors have taken to maintain and protect our intellectual property do not always prevent it from being challenged, invalidated, circumvented, designed-around or becoming subject to compulsory licensing. In some circumstances, enforcement is not available to us because an infringer has a dominant intellectual property position or for other business reasons.
In addition, the steps that we and our licensors have taken to maintain and protect our intellectual property do not always prevent it from being challenged, invalidated, circumvented, designed-around or becoming subject to compulsory licensing, particularly in countries where intellectual property rights are not highly developed or protected.
Climate change resulting from increased concentrations of carbon dioxide and other greenhouse gases in the atmosphere presents risks to our operations.
Climate change and sustainability matters, legal or regulatory measures to address climate change and sustainability matters, and any inability on our part to address related stakeholder expectations may negatively affect us. Climate change resulting from increased concentrations of carbon dioxide and other greenhouse gases in the atmosphere presents risks to our operations.
We also rely on nondisclosure and noncompetition agreements with employees, consultants and other parties to protect, in part, trade secrets and other proprietary rights.
In some circumstances, enforcement is not available to us because an infringer has a dominant intellectual property position or for other business reasons. We also rely on nondisclosure and noncompetition agreements with employees, consultants and other parties to protect, in part, trade secrets and other proprietary rights.
Competitors may also develop after-market services and parts for our products which may detract from our sales. Non-U.S. economic, political, legal, compliance, social and business factors can negatively affect our business and financial statements. In 2024, approximately 55% of our sales were derived from customers outside the U.S.
Failure to appropriately respond to this evolving landscape may result in legal liability, regulatory action, or brand and reputational harm. Non-U.S. economic, political, legal, compliance, social and business factors can negatively affect our business and financial statements. In 2025, approximately 56% of our sales were derived from customers outside the U.S.
Removed
If we suffer loss to our facilities, supply chains, distribution systems or information technology systems due to catastrophe or other events, our operations could be seriously harmed.
Added
If growth in any key economy of the world or in any of the markets we serve slows for a significant period, if there is significant deterioration in any such economy or such markets or if economic improvements do not benefit the markets we serve, our business and financial statements can be adversely affected.
Removed
These risks are particularly pronounced in countries in which we do business that do not have levels of protection of intellectual property comparable to the United States. Many of the markets we serve are technology-driven, and as a result intellectual property rights play a significant role in product development and differentiation.
Added
The U.S. government has imposed and may continue to impose significant tariffs or other restrictions on foreign imports, and such trade restrictions or related countermeasures taken by impacted foreign countries could negatively affect our business and financial statements.
Removed
These risks are particularly pronounced in countries in which we do business that do not have levels of protection of corporate proprietary information, intellectual property, technology and other assets comparable to the United States.
Added
The U.S. government has imposed significant tariffs or other restrictions on certain foreign imports and has raised the possibility of imposing additional tariff increases or expanding the tariffs to capture other countries and types of foreign imports.
Removed
The risks we encounter in such countries include but are not limited to the following: • Joint ventures that we participate in can include restrictions that could compromise our control over the intellectual property, technology and proprietary information of the joint venture; • As we expand our operations globally, increasing amounts of our data, intellectual property and technology is used and stored in countries outside the United States, and regulations in certain countries require data to be stored locally.
Added
For example, since January 2025, the U.S. government has threatened or imposed significant tariffs on imports from China and various new or additional tariffs on imports from other countries with limited, temporary 11 exclusions for certain goods.
Removed
These factors increase the risk that such data, intellectual property and technology could be stolen or otherwise compromised; • Certain of our products have been counterfeited and we may encounter additional and/or increased levels of counterfeiting in the future; • Governmental entities may adopt regulations or other requirements that give them rights to certain of our intellectual property, technology and/or proprietary information, such as through compulsory licensing or ownership restrictions or requirements; 18 • In certain countries, we do not have the same ability to enforce intellectual property rights as we do in the U.S.; • Governmental regulations relating to state secrecy or other topics limit our ability to transfer data or technology out of certain jurisdictions; and • Risks, costs and challenges of operating in a particular jurisdiction can result in a decision to relocate or divert operations to a different jurisdiction, potentially at higher cost.
Added
Any such current or future tariffs, along with other U.S. trade actions, have triggered and could further trigger retaliatory actions by certain affected countries, and other foreign governments may also impose trade measures, including reciprocal tariffs, on other U.S. goods in the future.
Removed
Any of these risks can adversely impact our business and financial statements. Refer to “—International economic, political, legal, compliance, social and business factors could negatively affect our financial statements” for a discussion of additional risks relating to our international operations.
Added
These tariffs and other trade actions could increase the cost of, and reduce demand for, our products and services, which would adversely impact our business.
Removed
In addition, because Veralto has not chosen to be exempt from Section 203 of the Delaware General Corporation Law (the “DGCL”), this provision could also delay or prevent a change of control that you may favor.
Added
In addition, political tensions as a result of trade policies could reduce trade volume, investment, technological exchange and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets, which could adversely affect our business and financial statements.
Removed
These exclusive forum provisions do not apply to actions arising under the Exchange Act or the rules and regulations thereunder.
Added
Competitors may also develop after-market services and parts for our products which may detract from our sales. Uncertainties with respect to the development, deployment, and use of artificial intelligence in our business and products may result in harm to our business and financial statements.
Removed
While the Delaware Supreme Court ruled in March 2020 that federal forum selection provisions purporting to require claims under the Securities Act be brought in federal court are “facially valid” under Delaware law, there is uncertainty as to whether other courts will enforce our federal forum provision described above.
Added
We are in the early stages of incorporating artificial intelligence (“AI”) into our business activities and our product and service offerings. As with many innovations, AI presents risks and challenges that could adversely impact our business.
Removed
Our stockholders will not be deemed to have waived compliance with the federal securities laws and the rules and regulations thereunder.
Added
The development, adoption, and use of AI technologies are still in their early stages and ineffective or inadequate AI development or deployment practices could result in unintended consequences. For example, AI algorithms may be flawed or may be based on datasets that are biased or insufficient.
Removed
These forum selection provisions may limit the ability of Veralto’s stockholders to bring a claim in a judicial forum that such stockholders find favorable for disputes with Veralto or Veralto’s directors or officers, which may discourage such lawsuits against Veralto and Veralto’s directors, officers, employees and stockholders, and such provision may also make it more expensive for Veralto’s stockholders to bring such claims.
Added
In addition, any disruption or failure in the AI functionality we incorporate into our business activities, products or services could adversely impact our business or result in delays or errors in our offerings.
Removed
Alternatively, if a court were to find these exclusive forum provisions inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings described above, Veralto may incur additional costs associated with resolving such matters in other jurisdictions, which could materially and adversely affect Veralto’s business and financial statements.
Added
Conversely, any failure to successfully develop and deploy AI in our business activities, products and services could adversely affect our competitiveness (particularly if our competitors successfully deploy AI in their businesses, products and services), and the development and deployment of AI will require additional investment and increase our costs.
Removed
If we are unable to maintain effective internal control over financial reporting in the future, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock may be negatively affected.
Added
There also may be real or perceived social harm, unfairness, or other outcomes that undermine public confidence in the use and deployment of AI. Any of the foregoing may result in decreased demand for our products or harm to our business and financial statements.
Removed
As a public company, we are required to maintain internal controls over financial reporting and to report any material weaknesses in such internal controls. In addition, we are required to furnish a report by management on the effectiveness of our internal control over financial reporting, pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”).
Added
The legal and regulatory landscape surrounding AI technologies is rapidly evolving and uncertain, including in the areas of intellectual property, cybersecurity and privacy and data protection. Compliance with new or changing laws, regulations or industry standards relating to AI may impose significant costs and may limit our ability to develop, deploy or use AI technologies.
Removed
Our independent registered public accounting firm is required to express an opinion as to the effectiveness of our internal control over financial reporting.
Added
Our liability insurance may not be sufficient in type or amount to cover us against claims related to security breaches, cyber-attacks and other related breaches.
Removed
At such time, our independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our internal control over financial reporting is documented, designed or operating.
Removed
The process of designing, implementing, and testing the internal control over financial reporting required to comply with this obligation is time consuming, costly, and complicated.
Removed
If we identify material weaknesses in our internal control over financial reporting, if we are unable to comply with the requirements of Section 404 of the Sarbanes-Oxley Act in a timely manner or to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock could be negatively affected, and we could become subject to investigations by the NYSE, the SEC, or other regulatory authorities, which could require additional financial and management resources.
Removed
Separation and Our Relationship with Danaher Risks As an independent, publicly traded company, Veralto may not enjoy the same benefits that Veralto did as a part of Danaher.
Removed
As an independent, publicly traded company, Veralto may become more susceptible to market fluctuations and other adverse events than it would have been if it were still a part of the current Danaher organizational structure.
Removed
As part of Danaher, Veralto was able to enjoy certain benefits from Danaher’s operating diversity, purchasing power and opportunities to pursue integrated strategies with Danaher’s other businesses. As an independent, publicly traded company, Veralto may not have similar diversity or integration opportunities and may not have similar purchasing power or access to capital markets.
Removed
Additionally, as part of Danaher, Veralto was able to leverage the Danaher historical market reputation and performance and brand identity to recruit and retain key personnel to run its business.
Removed
As a separate, publicly traded company, Veralto does not have the same historical market reputation and performance or brand identity as Danaher and it may be more difficult for us to recruit or retain such key personnel. 24 Potential indemnification liabilities to Danaher pursuant to the separation agreement could materially and adversely affect Veralto’s business and financial statements.
Removed
The separation agreement, among other things, provides for indemnification obligations (for uncapped amounts) designed to make Veralto financially responsible for substantially all liabilities that may exist relating to its business activities, whether incurred prior to or after the separation, as well as any other liabilities it agrees to assume pursuant to the separation agreement.
Removed
If Veralto is required to indemnify Danaher under the circumstances set forth in the separation agreement, Veralto may be subject to substantial liabilities. In connection with Veralto’s separation from Danaher, Danaher will indemnify Veralto for certain liabilities.
Removed
However, there can be no assurance that the indemnity will be sufficient to insure Veralto against the full amount of such liabilities, or that Danaher’s ability to satisfy its indemnification obligation will not be impaired in the future. Pursuant to the separation agreement and certain other agreements with Danaher, Danaher will agree to indemnify Veralto for certain liabilities.
Removed
However, third parties could also seek to hold Veralto responsible for any of the liabilities that Danaher has agreed to retain, and there can be no assurance that the indemnity from Danaher will be sufficient to protect Veralto against the full amount of such liabilities, or that Danaher will be able to fully satisfy its indemnification obligations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe Company’s cybersecurity program and policies articulate the expectations and requirements with respect to acceptable use, risk management, data privacy, education and awareness, security incident management and reporting, identity and access management, vendor due diligence, security (with respect to physical assets, 26 products, networks, and systems), security monitoring and vulnerability identification.
Biggest changeThe Company’s cybersecurity program and policies articulate the expectations and requirements with respect to acceptable use, risk management, data privacy, education and awareness, security incident management and reporting, identity and access management, vendor due diligence, security (with respect to physical assets, products, networks, and systems), security monitoring and vulnerability identification.
These risk areas include internal, product, vendor, supply chain, and external services leveraged across the Company. These risks are assessed, prioritized, and both tactically and strategically addressed via process, technology, and personnel improvements to help ensure ongoing mitigation and tracking.
These risk areas include internal, product, vendor, supply chain, and external services leveraged across the Company. These risks are assessed, prioritized, and both 23 tactically and strategically addressed via process, technology, and personnel improvements to help ensure ongoing mitigation and tracking.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changePROPERTIES As of December 31, 2024, the Company had facilities in over 50 countries, including 58 principal administrative, sales, research and development, manufacturing and distribution facilities. 22 of these facilities are located in the United States in over 12 states and 36 are located outside the United States, primarily in Europe and to a lesser extent in Latin America, Asia and Canada.
Biggest changePROPERTIES As of December 31, 2025, the Company had facilities in approximately 50 countries, including approximately 60 principal administrative, sales, research and development, manufacturing and distribution facilities. 21 of these facilities are located in the United States in 12 states and 39 are located outside the United States, primarily in Europe and to a lesser extent in Latin America, Asia and Canada.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeConsistent with SEC Regulation S-K Item 103, we have elected to disclose those environmental proceedings (if any) with a governmental entity as a party where the Company reasonably believes such proceeding would result in monetary sanctions, exclusive of interest and costs, of $1 million or more. 27 ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 28 Table of Contents PART II
Biggest changeConsistent with SEC Regulation S-K Item 103, we have elected to disclose those environmental proceedings (if any) with a governmental entity as a party where the Company reasonably believes such proceeding would result in monetary sanctions, exclusive of interest and costs, of $1 million or more. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 24 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeWe have historically paid a quarterly dividend of $0.09 per share of our common stock. In December 2024, our Board of Directors increased the quarterly dividend paid to $0.11 per share from $0.09 per share, an increase of 22%.
Biggest changeIn the fourth quarter of 2025, we increased the quarterly dividend of $0.11 per share to $0.13 per share on our common stock.
ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is traded on the New York Stock Exchange under the symbol VLTO. As of February 14, 2025, there were 1,369 holders of record of Veralto’s common stock.
ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is traded on the New York Stock Exchange under the symbol VLTO. As of February 13, 2026, there were 1,291 holders of record of Veralto’s common stock.
Any future declaration and payments of dividends, including any change in the amount of quarterly dividend, on our common stock will be determined by our Board of Directors and will depend on our business conditions, financial results and other factors our Board deems relevant. Recent Issuances of Unregistered Securities None. ITEM 6. [RESERVED] 29 Table of Contents
Any future declaration and payments of dividends, including any change in the amount of quarterly dividend, on our common stock will be determined by our Board of Directors and will depend on our business conditions, financial results and other factors our Board deems relevant.
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Issuer Purchase of Equity Securities On November 25, 2025, the Company announced that its Board of Directors approved a share repurchase program (the “Repurchase Program”) authorizing the repurchase of up to $750 million of the Company’s common stock from time to time on the open market (including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended), in privately negotiated transactions or by other methods, at the Company’s discretion.
Added
The program does not obligate the Company to acquire any particular amount of its common stock, has no expiration date, and will continue until otherwise suspended or terminated at any time for any reason.
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The timing and amount of any share repurchases under the program will be determined by members of the Company’s management based on its evaluation of market, business conditions, and other factors. During the quarter ended December 31, 2025, the Company did not make any share repurchases. Recent Issuances of Unregistered Securities None. ITEM 6. [RESERVED] 25 Table of Contents

Item 7. Management's Discussion & Analysis

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

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Biggest changeThe following factors impacted year-over-year operating profit margin comparisons. 2024 vs. 2023 operating profit margin comparisons were favorably impacted by: • The impact of Argentine Peso devaluation on operations within the Product Quality & Innovation segment during 2023 - 60 basis points • 2023 impairment charge related to customer relationships and a trade name in the Product Quality and Innovation segment - 20 basis points • One-time costs incurred in 2023 as a result of the Separation from Danaher - 10 basis points 2024 vs. 2023 operating profit margin comparisons were unfavorably impacted by: • The net dilutive impact of 2024 acquisitions and dispositions - 10 basis points • The impact of incremental costs associated with operating as a stand-alone company, labor, R&D growth initiatives, and sales and marketing growth initiatives partially offset by higher 2024 core sales, foreign currency exchange rates, lower material costs and cost savings associated with continuing productivity improvement initiatives - 20 basis points 34 Table of Contents WATER QUALITY The Company’s Water Quality segment provides proprietary precision instrumentation, consumables, software, services and advanced water treatment technologies to help measure, analyze and treat the world’s water in municipal, industrial, commercial, residential, research and natural resource applications.
Biggest changeThe following factors impacted year-over-year operating profit margin comparisons. 2025 vs. 2024 operating profit margin comparisons were unfavorably impacted by: • Costs incurred during 2025 related to certain strategic initiatives - 20 basis points • Reduction of the tax indemnification related to the Separation from Danaher - 20 basis points • The net dilutive impact during 2025 of acquisitions and dispositions - 10 basis points. 2025 vs. 2024 operating profit margin comparisons were favorably impacted by: • Transaction costs incurred during 2024 related to the acquisition of TraceGains - 10 basis points • Higher 2025 core sales, partially offset by incremental labor costs, sales and marketing growth initiatives, and the impact of product mix - 30 basis points WATER QUALITY The Company’s Water Quality segment provides proprietary precision instrumentation, consumables, software, services and advanced water treatment technologies to help measure, analyze and treat the world’s water in municipal, industrial, commercial, residential, research and natural resource applications. 30 Table of Contents Water Quality Selected Financial Data Year Ended December 31 ($ in millions) 2025 2024 2023 Sales $ 3,321 $ 3,138 $ 3,039 Operating profit 844 768 730 Depreciation 26 25 24 Amortization of intangible assets 10 16 21 Operating profit as a % of sales 25.4 % 24.5 % 24.0 % Depreciation as a % of sales 0.8 % 0.8 % 0.8 % Amortization as a % of sales 0.3 % 0.5 % 0.7 % Sales Growth and Core Sales Growth 2025 vs. 2024 2024 vs. 2023 Total sales growth GAAP 5.9 % 3.2 % Impact of: Acquisitions/divestitures (0.2) % 0.3 % Currency exchange rates (1.0) % 0.4 % Core sales growth (non-GAAP) 4.7 % 3.9 % 2025 Sales Compared to 2024 Total Water Quality segment sales increased 5.9% on a year-over-year basis during 2025 as compared to 2024 primarily as a result of core sales growth driven by the factors discussed belo w.
To evaluate the sensitivity of the fair value calculations used in the goodwill impairment test, the Company applied a hypothetical 10% decrease to the fair values of each reporting unit and compared those hypothetical values to the reporting unit carrying values.
To evaluate the sensitivity of the fair value calculations used in the goodwill impairment test, the Company applied a hypothetical 10% decrease to the fair value of each reporting unit and compared those hypothetical values to the reporting unit carrying values.
In performing its goodwill impairment testing, the Company estimates the fair value of its reporting units primarily using a market-based approach which relies on current trading multiples of forecasted EBITDA for peer companies and recent transactions for comparable companies operating in businesses similar to each of the Company’s reporting units to calculate an estimated fair value of each reporting unit.
In performing its goodwill impairment testing, the Company estimates the fair value of its reporting units using a market-based approach which relies on current trading multiples of forecasted EBITDA for peer companies and recent transactions for comparable companies operating in businesses similar to each of the Company’s reporting units to calculate an estimated fair value of each reporting unit.
The Company continues to generate substantial cash from operating activities and believes that its operating cash flow and other sources of liquidity will be sufficient to allow it to continue to invest in existing businesses, consummate strategic acquisitions, make interest payments on its outstanding indebtedness, and manage its capital structure on a short and long-term basis. 39 Table of Contents Shelf Registration Statement On October 24, 2024, the Company filed a shelf registration statement on Form S-3 with the SEC (the “Shelf Registration Statement”) that registers an indeterminate amount of debt securities, common stock, preferred stock, depositary shares, subscription rights, purchase contracts, units and warrants that may be issued in the future in one or more offerings.
The Company continues to generate substantial cash from operating activities and believes that its operating cash flow and other sources of liquidity will be sufficient to allow it to continue to invest in existing businesses, consummate strategic acquisitions, make interest payments on its outstanding indebtedness, and manage its capital structure on a short and long-term basis. 35 Table of Contents Shelf Registration Statement On October 24, 2024, the Company filed a shelf registration statement on Form S-3 with the SEC (the “Shelf Registration Statement”) that registers an indeterminate amount of debt securities, common stock, preferred stock, depositary shares, subscription rights, purchase contracts, units and warrants that may be issued in the future in one or more offerings.
Income Taxes —For a description of the Company’s income tax accounting policies, refer to Notes 1 and 6 to the Consolidated and Combined Financial Statements. The Company establishes valuation allowances for its deferred tax assets if it is more likely than not that some or all of the deferred tax asset will not be realized.
Income Taxes —For a description of the Company’s income tax accounting policies, refer to Notes 1 and 6 to the accompanying Consolidated and Combined Financial Statements. The Company establishes valuation allowances for its deferred tax assets if it is more likely than not that some or all of the deferred tax asset will not be realized.
The Company engages third-party valuation specialists who review the Company’s critical assumptions and calculations of the fair value of acquired intangible assets in connection with significant acquisitions. Refer to Notes 1, 2 and 9 to the Consolidated and Combined Financial Statements for a description of the Company’s policies relating to goodwill, acquired intangibles and acquisitions.
The Company engages third-party valuation specialists who review the Company’s critical assumptions and calculations of the fair value of acquired intangible assets in connection with significant acquisitions. Refer to Notes 1, 2 and 9 to the accompanying Consolidated and Combined Financial Statements for a description of the Company’s policies relating to goodwill, acquired intangibles and acquisitions.
In addition, certain of the Company’s tax returns are currently under review by tax authorities (refer to “—Results of Operations—Income Taxes” and Note 6 to the Consolidated and Combined Financial Statements). Management believes the positions taken in these returns are in accordance with the relevant tax laws.
In addition, certain of the Company’s tax returns are currently under review by tax authorities (refer to “—Results of Operations—Income Taxes” and Note 6 to the accompanying Consolidated and Combined Financial Statements). Management believes the positions taken in these returns are in accordance with the relevant tax laws.
Determining whether an impairment loss occurred for indefinite-lived intangible assets involves calculating the fair value of the indefinite-lived intangible assets and comparing the fair value to their carrying value. If the fair value is less than the carrying value, the difference is recorded as an impairment loss. There were no intangible asset impairment charges recorded during 2024.
Determining whether an impairment loss occurred for indefinite-lived intangible assets involves calculating the fair value of the indefinite-lived intangible assets and comparing the fair value to their carrying value. If the fair value is less than the carrying value, the difference is recorded as an impairment loss. There were no intangible asset impairment charges recorded during 2025 and 2024.
RESULTS OF OPERATIONS Non-GAAP Measures In this report, references to the non-GAAP measure of core sales refer to sales from continuing operations calculated according to GAAP but excluding: • sales from acquired or divested businesses (as defined below, as applicable); and • the impact of currency translation.
RESULTS OF OPERATIONS Non-GAAP Measures In this report, references to the non-GAAP measure of core sales refer to sales calculated according to GAAP but excluding: • sales from acquired or divested businesses (as defined below, as applicable); and • the impact of currency translation.
Acquired Intangibles —The Company’s business acquisitions typically result in the recognition of goodwill, customer relationships, developed technology and other intangible assets, which affect the amount of future period amortization expense and possible impairment charges that the Company may incur.
Acquired Intangible Assets —The Company’s business acquisitions typically result in the recognition of goodwill, customer relationships, developed technology and other intangible assets, which affect the amount of future period amortization expense and possible impairment charges that the Company may incur.
Legal Proceedings” and Note 16 to the Consolidated and Combined Financial Statements, the Company is, from time to time, subject to a variety of litigation and similar contingent liabilities incidental to its business (or the business operations of previously owned entities).
Legal Proceedings” and Note 16 to the accompanying Consolidated and Combined Financial Statements, the Company is, from time to time, subject to a variety of litigation and similar contingent liabilities incidental to its business (or the business operations of previously owned entities).
In addition, because most contingencies are resolved over long periods of time, liabilities may change in the future due to various factors, including those discussed in Note 16 to the Consolidated and Combined Financial Statements.
In addition, because most contingencies are resolved over long periods of time, liabilities may change in the future due to various factors, including those discussed in Note 16 to the accompanying Consolidated and Combined Financial Statements.
Other Before the Separation, the Company was dependent upon Danaher for all of its working capital and financing requirements under Danaher’s centralized approach to cash management and financing of operations of its subsidiaries.
Before the Separation, the Company was dependent upon Danaher for all of its working capital and financing requirements under Danaher’s centralized approach to cash management and financing of operations of its subsidiaries.
Contractual and Other Obligations For a description of the Company’s debt and lease obligations, commitments, and litigation and contingencies, refer to Notes 8, 12, 15 and 16 to the Consolidated and Combined Financial Statements.
Contractual and Other Obligations For a description of the Company’s debt and lease obligations, commitments, and litigation and contingencies, refer to Notes 8, 12, 15 and 16 to the accompanying Consolidated and Combined Financial Statements.
Legal Proceedings Refer to Note 16 to the Consolidated and Combined Financial Statements for information regarding legal proceedings and contingencies, and for a discussion of risks related to legal proceedings and contingencies, refer to “Item 1A.
Legal Proceedings Refer to Note 16 to the accompanying Consolidated and Combined Financial Statements for information regarding legal proceedings and contingencies, and for a discussion of risks related to legal proceedings and contingencies, refer to “Item 1A.
For a detailed discussion on the application of these and other accounting estimates, refer to Note 1 to the Consolidated and Combined Financial Statements.
For a detailed discussion on the application of these and other accounting estimates, refer to Note 1 to the accompanying Consolidated and Combined Financial Statements.
NEW ACCOUNTING STANDARDS For a discussion of the new accounting standards impacting the Company, refer to Note 1 to the Consolidated and Combined Financial Statements.
NEW ACCOUNTING STANDARDS For a discussion of the new accounting standards impacting the Company, refer to Note 1 to the accompanying Consolidated and Combined Financial Statements.
There are inherent uncertainties related to these assumptions and management’s judgment in applying them to the analysis of goodwill impairment. As of December 31, 2024, the Company had three reporting units for goodwill impairment testing. Reporting units resulting from recent acquisitions generally present the highest risk of impairment.
There are inherent uncertainties related to these assumptions and management’s judgment in applying them to the analysis of goodwill impairment. As of December 31, 2025, the Company had three reporting units for goodwill impairment testing. Reporting units resulting from recent acquisitions generally present the highest risk of impairment.
If the reserves 43 Table of Contents established by the Company with respect to these contingent liabilities are inadequate, the Company would be required to incur an expense equal to the amount of the loss incurred in excess of the reserves, which would adversely affect the Company’s financial statements.
If the reserves established by the Company with respect to these contingent liabilities are inadequate, 39 Table of Contents the Company would be required to incur an expense equal to the amount of the loss incurred in excess of the reserves, which would adversely affect the Company’s financial statements.
Corporate Allocations —Prior to the Separation, the Company operated as part of Danaher and not as a separate, publicly traded company. Accordingly, certain shared costs have been allocated to the Company and are reflected as expenses in the accompanying Combined Financial Statements.
Corporate Allocations —Prior to the Separation, the Company operated as part of Danaher and not as a separate, publicly traded company. Accordingly, certain shared costs have been allocated to the Company and are reflected as expenses in the accompanying Combined Financial Statements for the period prior to the Separation.
The MD&A is designed to focus specifically on material events and uncertainties known to management that are reasonably likely to cause reported financial information not to be necessarily indicative of future operating results or of future financial condition.
This MD&A is designed to focus specifically on material events and uncertainties known to management that are reasonably likely to cause reported financial information not to be necessarily indicative of future operating results or of future financial condition.
Significant assumptions include the discount rates and certain assumptions that form the basis of the forecasted results of the acquired business including earnings before interest, taxes, depreciation and amortization (“EBITDA”), revenue, revenue growth rates, royalty rates and technology obsolescence rates. These assumptions are forward looking and could be affected by future economic and market conditions.
Significant assumptions include the discount rates and 38 Table of Contents certain assumptions that form the basis of the forecasted results of the acquired business including earnings before interest, taxes, depreciation and amortization (“EBITDA”), revenue, revenue growth rates, royalty rates and technology obsolescence rates. These assumptions are forward-looking and could be affected by future economic and market conditions.
Refer to Note 2 to the Consolidated and Combined Financial Statements included in this Annual Report for a discussion of the Company’s acquisitions. • Net cash used in financing activities consisted of cash dividend payments offset by proceeds from the issuance of common stock in connection with stock-based compensation.
Refer to Note 2 to the accompanying Consolidated and Combined Financial Statements included in this Annual Report for a discussion of the Company’s acquisitions. • Net cash used in financing activities consisted primarily of cash dividend payments, partially offset by proceeds from the issuance of common stock in connection with stock-based compensation.
Discussions of 2022 items and year-over-year comparisons between 2023 and 2022 are not included, and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (“MD&A”) in Part II, Item 7 of the Company’s Annual Report on Form 10-K filed for the fiscal year ended December 31, 2023 with the Securities and Exchange Commission on February 28, 2024.
Discussions of 2023 items and year-over-year comparisons between 2024 and 2023 are not included, and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (“MD&A”) in Part II, Item 7 of the Company’s Annual Report on Form 10-K filed for the fiscal year ended December 31, 2024 with the Securities and Exchange Commission on February 25, 2025.
The portion of revenue attributable to currency translation is calculated as the difference between: • the period-to-period change in revenue (excluding sales from acquired/divested businesses (as defined above, as applicable)); and 32 Table of Contents • the period-to-period change in revenue (excluding sales from acquired/divested businesses (as defined above, as applicable)) after applying current period foreign exchange rates to the prior year period.
The portion of revenue attributable to currency translation is calculated as the difference between: • the period-to-period change in revenue (excluding sales from acquired/divested businesses (as defined above, as applicable)); and • the period-to-period change in revenue (excluding sales from acquired/divested businesses (as defined above, as applicable)) after applying current period foreign exchange rates to the prior year period.
A 10% depreciation in major currencies relative to the U.S. dollar as of December 31, 2024 would have reduced foreign currency-denominated net assets and equity by approximately $118 million. Refer to Note 13 to the Consolidated and Combined Financial Statements for information regarding the Company’s hedging of a portion of its net investment in non-U.S. operations.
A 10% depreciation in major currencies relative to the U.S. dollar as of December 31, 2025 would have reduced foreign currency-denominated net assets and equity by approximately $71 million. Refer to Note 13 to the accompanying Consolidated and Combined Financial Statements for information regarding the Company’s hedging of a portion of its net investment in non-U.S. operations.
The Company considers the allocation methodologies used to be reasonable and appropriate reflections of the related expenses attributable to Veralto for purposes of the carve-out financial statements; however, the expenses reflected in these financial statements may not be indicative of the actual expenses that would have been incurred during the periods presented if Veralto had operated as a separate stand-alone entity.
The Company considers the allocation methodologies used to be reasonable and appropriate reflections of the related expenses attributable to Veralto for purposes of the carve-out financial statements; however, the expenses reflected in these financial statements may not be indicative of the actual expenses that would have been incurred during the period prior to the Separation if Veralto had operated as a separate stand-alone entity.
Risk Factors.” The Company’s amended and restated certificate of incorporation require it to indemnify to the full extent authorized or permitted by law any person made, or threatened to be made a party to any action or proceeding by reason of his or her service as a director or officer of the Company, or by reason of serving at the request of the Company as a director or officer of any other entity, subject to limited exceptions.
Risk Factors.” The Company’s certificate of incorporation requires it to indemnify to the full extent authorized or permitted by law any person made, or threatened to be made a party to any action or proceeding by reason of his or her service as a director or officer of the Company, or by reason of serving at the request of the Company as a director or officer of any other entity, subject to limited exceptions.
In addition, the expenses reflected in the financial statements may not be indicative of expenses that will be incurred in the future by Veralto. Refer to Note 18 to the Consolidated and Combined Financial Statements for a description of corporate allocations and related party transactions.
In addition, the expenses reflected in the financial statements for the period prior to the Separation may not be indicative of expenses that will be incurred in the future by Veralto. Refer to Note 18 to the accompanying Consolidated and Combined Financial Statements for a description of corporate allocations and related party transactions.
The fair values of acquired intangibles are determined using information available near the acquisition date based on estimates and 42 Table of Contents assumptions that are deemed reasonable by the Company.
The fair values of acquired intangibles are determined using information available near the acquisition date based on estimates and assumptions that are deemed reasonable by the Company.
Based on this hypothetical 10% decrease, the excess of the estimated fair value over carrying value (expressed as a percentage of carrying value for the respective reporting unit) for each of the Company’s reporting units ranged from approximately 144% to approximately 783%.
Based on this hypothetical 10% decrease, the excess of the estimated fair value over carrying value (expressed as a percentage of carrying value for the respective reporting unit) for each of the Company’s reporting units ranged from approximately 66% to approximately 781%.
The Company’s amended and restated by-laws provide for similar indemnification rights. While the Company maintains insurance for this type of liability, a significant deductible apply to this coverage and any such liability could exceed the amount of the insurance coverage.
The Company’s by-laws provide for similar indemnification rights. While the Company maintains insurance for this type of liability, a significant deductible applies to this coverage and any such liability could exceed the amount of the insurance coverage.
Because the Company was part of Danaher during the nine-month period ended September 29, 2023, only cash, cash equivalents and borrowings clearly associated with Veralto and related to the Separation, including the financing transactions described below, were included in the Combined Financial Statements.
Because the Company was part of Danaher during the nine-month period ended September 29, 2023, only cash, cash equivalents and borrowings clearly associated with Veralto and related to the Separation were included in the Combined Financial Statements.
The excess of the estimated fair value over carrying value (expressed as a percentage of carrying value for the respective reporting unit) for each of the Company’s reporting units as of the annual testing date ranged from approximately 202% to approximately 991%.
The excess of the estimated fair value over carrying value (expressed as a percentage of carrying value for the respective reporting unit) for each of the Company’s reporting units as of the annual testing date ranged from approximately 104% to approximately 987%.
Risk Factors” and the accompanying Consolidated and Combined Financial Statements and Notes to Consolidated and Combined Financial Statements (“Notes”) included in Item 8. of this Form 10-K. The MD&A generally discusses 2024 and 2023 items and year-over-year comparisons between 2024 and 2023.
Risk Factors” and the accompanying Consolidated and Combined Financial Statements and Notes to Consolidated and Combined Financial Statements (“Notes”) included in Item 8. of this Annual Report on Form 10-K. This MD&A generally discusses 2025 and 2024 items and year-over-year comparisons between 2025 and 2024.
Core sales in the packaging and color solutions business increased 4.5% on a year-over-year basis during 2024 as compared to 2023 driven by increased demand across the consumer-packaged goods and industrial end-markets. Operating Profit Performance Operating profit margins were 25.7% for the year ended December 31, 2024 as compared to 23.8% in 2023.
Core sales in the packaging and color solutions business increased 3.8% on a year-over-year basis during 2025 as compared to 2024 driven by increased demand across the consumer-packaged goods and industrial end-markets. Operating Profit Performance Operating profit margins were 25.2% for the year ended December 31, 2025 as compared to 25.7% in 2024.
Product Quality & Innovation Selected Financial Data Year Ended December 31 ($ in millions) 2024 2023 2022 Sales $ 2,055 $ 1,982 $ 1,983 Operating profit 529 472 488 Depreciation 14 15 16 Amortization of intangible assets 22 27 28 Operating profit as a % of sales 25.7 % 23.8 % 24.6 % Depreciation as a % of sales 0.7 % 0.8 % 0.8 % Amortization as a % of sales 1.1 % 1.4 % 1.4 % Sales Growth and Core Sales Growth (Decline) 2024 vs. 2023 2023 vs. 2022 Total sales growth GAAP 3.7 % — % Impact of: Acquisitions/divestitures (0.4) % (0.7) % Currency exchange rates — % (0.3) % Core sales growth (decline) (non-GAAP) 3.3 % (1.0) % 2024 Sales Compared to 2023 Total Product Quality & Innovation segment sales increased 3.7% on a year-over-year basis during 2024 as compared to 2023 primarily as a result of core sales growth driven by the factors discussed below.
Product Quality & Innovation Selected Financial Data Year Ended December 31 ($ in millions) 2025 2024 2023 Sales $ 2,182 $ 2,055 $ 1,982 Operating profit 549 529 472 Depreciation 15 14 15 Amortization of intangible assets 26 22 27 Operating profit as a % of sales 25.2 % 25.7 % 23.8 % Depreciation as a % of sales 0.7 % 0.7 % 0.8 % Amortization as a % of sales 1.2 % 1.1 % 1.4 % Sales Growth and Core Sales Growth 2025 vs. 2024 2024 vs. 2023 Total sales growth GAAP 6.2 % 3.7 % Impact of: Acquisitions/divestitures 0.1 % (0.4) % Currency exchange rates (1.5) % — % Core sales growth (non-GAAP) 4.8 % 3.3 % 2025 Sales Compared to 2024 Total Product Quality & Innovation segment sales increased 6.2% on a year-over-year basis during 2025 as compared to 2024 primarily as a result of core sales growth driven by the factors discussed below.
The effect of a change in currency exchange rates on the Company’s net investment in non-U.S. subsidiaries is reflected in the accumulated other comprehensive income (loss) component of equity. Currency exchange rates negatively impacted 2024 reported sales on a year-over-year basis primarily due to the strengthening of the U.S. dollar against most major currencies during 2024.
The effect of a change in currency exchange rates on the Company’s net investment in non-U.S. subsidiaries is reflected in the accumulated other comprehensive income (loss) component of stockholders’ equity. Currency exchange rates positively impacted 2025 reported sales on a year-over-year basis primarily due to the weakening of the U.S. dollar against most major currencies during 2025.
The MD&A is divided into seven sections: • Basis of Presentation • Overview • Results of Operations • Financial Instruments and Risk Management • Liquidity and Capital Resources • Critical Accounting Estimates • New Accounting Standards The following MD&A should be read together with Part I, “Item 1A.
This MD&A is divided into seven sections: • Basis of Presentation • Overview • Results of Operations • Financial Instruments and Risk Management • Liquidity and Capital Resources • Critical Accounting Estimates • New Accounting Standards • Separation from Danaher This MD&A should be read together with Part I, “Item 1A.
The following table summarizes the Company’s effective tax rate: Year Ended December 31 2024 2023 2022 Effective tax rate 23.3 % 23.4 % 24.1 % The Company’s effective tax rate for 2024 differs from the U.S. federal statutory rate of 21.0% due principally to the Company’s earnings outside the United States that are taxed at rates different than the U.S. federal statutory rate, and state taxes, partially offset by a net discrete tax provision of $6 million.
The following table summarizes the Company’s effective tax rate: Year Ended December 31 2025 2024 2023 Effective tax rate 19.9 % 23.3 % 23.4 % The Company’s effective tax rate for 2025 differs from the U.S. federal statutory rate of 21.0% due principally to the Company’s earnings outside the United States that are taxed at rates different than the U.S. federal statutory rate, and state taxes, partially offset by a net discrete tax benefit of $21 million.
The Company’s individual businesses monitor key competitors and customers, including to the extent possible their sales, to gauge relative performance and the outlook for the future.
The Company’s 26 Table of Contents individual businesses monitor key competitors and customers, including to the extent possible their sales, to gauge relative performance and the outlook for the future.
Weakening of the U.S. dollar against other major currencies compared to the exchange rates in effect as of December 31, 2024 would positively impact the Company’s sales and results of operations on an overall basis.
Strengthening of the U.S. dollar against other major currencies compared to the exchange rates in effect as of December 31, 2025 would negatively impact the Company’s sales and results of operations on an overall basis.
Accordingly, the Consolidated and Combined Financial Statements may not be indicative of Veralto’s results had the Company been a separate stand-alone entity throughout the periods presented. For further discussion of related party allocations prior to the 30 Table of Contents Separation, including the method for such allocation, refer to Note 18 to the Consolidated and Combined Financial Statements.
Accordingly, the Consolidated and Combined Financial Statements for the period prior to the Separation may not be indicative of Veralto’s results had the Company been a separate stand-alone entity. For further discussion of related party allocations prior to the Separation, including the method for such allocation, refer to Note 18 to the accompanying Consolidated and Combined Financial Statements.
Business Segments Sales by business segment for the years ended December 31 are as follows: ($ in millions) 2024 2023 2022 Water Quality $ 3,138 $ 3,039 $ 2,887 Product Quality & Innovation 2,055 1,982 1,983 Total $ 5,193 $ 5,021 $ 4,870 Sales and operating profit at the business segment level are discussed in detail below.
Business Segments Sales by business segment for the years ended December 31 are as follows: ($ in millions) 2025 2024 2023 Water Quality $ 3,321 $ 3,138 $ 3,039 Product Quality & Innovation 2,182 2,055 1,982 Total $ 5,503 $ 5,193 $ 5,021 Sales and operating profit at the business segment level are discussed in detail below.
Any further strengthening of the U.S. dollar against other major currencies compared to the exchange rates in effect as of December 31, 2024 would negatively impact the Company’s sales and results of operations.
Any further weakening of the U.S. dollar against other major currencies compared to the exchange rates in effect as of December 31, 2025 would positively impact the Company’s sales and results of operations.
Price increases in the segment contributed 1.4% to sales growth on a year-over-year basis during 2024 as compared to 2023 and are reflected as a component of the change in core sales growth. Core sales in the Product Quality & Innovation segment increased 3.3% on a year-over-year basis during 2024 as compared to 2023.
Price increases in the segment contributed 2.6% to sales growth on a year-over-year basis during 2025 as compared to 2024 and are reflected as a component of the change in core sales growth. Core sales in the Product Quality & Innovation segment increased 4.8% on a year-over-year basis during 2025 as compared to 2024.
Net earnings for the year ended December 31, 2024 totaled approximately $833 million, or $3.34 per diluted common share, compared to approximately $839 million, or $3.40 per diluted common share, for the year ended December 31, 2023.
Net earnings for the year ended December 31, 2025 totaled approximately $940 million, or $3.76 per diluted common share, compared to approximately $833 million, or $3.34 per diluted common share, for the year ended December 31, 2024.
Price increases in the segment contributed 2.1% to sales growth on a year-over-year basis during 2024 as compared to 2023 and are reflected as a component of the change in core sales growth. Core sales in the Water Quality segment increased 3.9% on a year-over-year basis during 2024 as compared to 2023.
Price increases in the segment contributed 1.5% to sales growth on a year-over-year basis during 2025 as compared to 2024 and are reflected as a component of the change in core sales growth. Core sales in the Water Quality segment increased 4.7% on a year-over-year basis during 2025 as compared to 2024.
Operating Profit Performance Operating profit margins were 24.5% for the year ended December 31, 2024 as compared to 24.0% in 2023.
Operating Profit Performance Operating profit margins were 25.4% for the year ended December 31, 2025 as compared to 24.5% in 2024.
The Company’s core sales during 2024 in developed markets increased 4.2% year-over-year driven by a 5.3% increase in North America and a 2.2% increase in Western Europe. Core sales in high-growth markets increased 2.5% driven by high-single digit increases in Latin America partially offset by mid-single digit decreases in China.
The Company’s core sales during 2025 in developed markets increased 4.8% year-over-year driven by a 5.3% increase in North America and a 3.8% increase in Western Europe. Core sales in high-growth markets increased 5.1% driven by mid-single digit increases in Latin America and low-single digit increases in China.
Geographically, core sales growth was driven by increases of 3.0% in North America, 5.1% in high-growth markets, and 2.3% in Western Europe. Core sales growth in the high-growth markets was driven by high-single digit core sales increases in Latin America and mid-single digit core sales increases in China.
Geographically, core sales growth was driven by increases of 5.8% in North America, 5.4% in high-growth markets, and 3.6% in Western Europe. Core sales growth in high-growth markets was driven by mid-single digit core sales increases in Latin America and mid-single digit core sales increases in China.
From a product line perspective, core sales in the marking and coding business increased 2.8% on a year-over-year basis during 2024 as compared to 2023 driven by higher consumable demand in the industrial and consumer packaged goods end-markets.
From a product line perspective, core sales in the marking and coding business increased 5.2% on a year-over-year basis during 2025 as compared to 2024 driven by increased demand for consumables and new equipment in the industrial and consumer packaged goods end-markets.
COMPREHENSIVE INCOME Comprehensive income decreased by $123 million in 2024 as compared to 2023, primarily driven by losses from foreign currency translation adjustments partially offset by unrealized gains on a net investment hedge, and to a lesser extent, pension and post-retirement plan benefit adjustments.
COMPREHENSIVE INCOME Comprehensive income increased by $382 million in 2025 as compared to 2024, primarily driven by gains from foreign currency translation adjustments and to a lesser extent higher net earnings, partially offset by unrealized losses on net investment hedges and pension and post-retirement plan benefit adjustments.
There were no dividends paid during 2023. Cash and Cash Requirements As of December 31, 2024, the Company held approximately $1.1 billion of cash and cash equivalents that were on deposit with financial institutions or invested in highly liquid investment-grade debt instruments with a maturity of 90 days or less with an approximate weighted average annual interest rate of 4.48%.
Cash and Cash Requirements As of December 31, 2025, the Company held approximately $2.0 billion of cash and cash equivalents that were on deposit with financial institutions or invested in highly liquid investment-grade debt instruments with a maturity of 90 days or less with an approximate weighted average annual interest rate of 3.7%.
Of the cash and cash equivalents, approximately $342 million was held within the United States and approximately $759 million was held outside of the United States.
Of the cash and cash equivalents, approximately $870 million was held within the United States and approximately $1.1 billion was held outside of the United States.
CRITICAL ACCOUNTING ESTIMATES Management’s discussion and analysis of the Company’s financial condition and results of operations is based upon the Company’s Consolidated and Combined Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States.
CRITICAL ACCOUNTING ESTIMATES This MD&A is based upon the Company’s Consolidated and Combined Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States.
The net discrete tax benefits related primarily to excess tax benefits from stock-based compensation. 37 Table of Contents The Company’s effective tax rate for 2022 differs from the U.S. federal statutory rate of 21.0% due principally to the Company’s earnings outside the United States that are taxed at rates different than the U.S. federal statutory rate, and state taxes, partially offset by net discrete tax benefits of $4 million.
The Company’s effective tax rate for 2024 differs from the U.S. federal statutory rate of 21.0% due principally to the Company’s earnings outside the United States that are taxed at rates different than the U.S. federal statutory rate, and state taxes, partially offset by a net discrete tax provision of $6 million.
R&D expenses as a percentage of sales increased by 40 basis points on a year-over-year basis during 2024 as compared to 2023 driven by growth related R&D initiatives. Operating Profit Performance Operating profit margins were 23.3% for the year ended December 31, 2024 as compared to 22.7% in 2023.
R&D expenses as a percentage of sales slightly declined by 10 basis points on a year-over-year basis during 2025 as compared to 2024. Operating Profit Performance Operating profit margins were 23.2% for the year ended December 31, 2025 as compared to 23.3% in 2024.
The impact of acquisitions increased reported sales by 0.4% during 2024 as compared to 2023. Geographically, reported sales increased by 4.5% in North America, 3.3% in Western Europe, and 4.0% in high-growth markets.
Currency exchange rates increased reported sales by 1.5% during 2025 as compared to 2024. The impact of acquisitions, net of divestitures decreased reported sales by 0.1% during 2025 as compared to 2024. Geographically, reported sales increased by 8.0% in North America, 6.6% in Western Europe, and 4.0% in high-growth markets.
The Company has generally accepted the exposure to exchange rate movements without using derivative financial instruments to manage this transactional exchange risk, although the Company has used foreign currency-denominated debt to hedge a portion of its net investments in non-U.S. operations against adverse movements in exchange rates.
The Company has generally accepted the exposure to exchange rate movements without using derivative financial instruments to manage this transactional exchange risk, although the Company from time to time partially hedges its net investments in foreign operations against adverse movements in exchange rates through foreign currency denominated debt and cross-currency swaps.
Dividends The Company’s board of directors authorized a quarterly dividend of $0.11 per share of Company common stock totaling $27 million that was paid on January 31, 2025 to holders of record at the close of business on December 31, 2024. Aggregate cash payments for dividends during the year ended December 31, 2024 were $89 million.
Dividends The Company’s board of directors authorized a quarterly dividend of $0.13 per share of Company common stock totaling $32 million that was paid on January 30, 2026 to holders of record at the close of business on December 31, 2025.
Sales Growth and Core Sales Growth 2024 vs. 2023 2023 vs. 2022 Total sales growth GAAP 3.4 % 3.1 % Impact of: Acquisitions/divestitures — % (0.3) % Currency exchange rates 0.3 % (0.2) % Core sales growth (non-GAAP) 3.7 % 2.6 % 2024 Sales Compared to 2023 Total sales increased 3.4% on a year-over-year basis during 2024 as compared to 2023 primarily as a result of a 3.7% increase in core sales resulting from the factors discussed below by segment.
Throughout this discussion, references to sales growth or decline refer to the impact of both price and unit sales and references to productivity improvements generally refer to improved cost efficiencies resulting from the ongoing application of VES. 28 Table of Contents Sales Growth and Core Sales Growth 2025 vs. 2024 2024 vs. 2023 Total sales growth GAAP 6.0 % 3.4 % Impact of: Acquisitions/divestitures (0.1) % — % Currency exchange rates (1.2) % 0.3 % Core sales growth (non-GAAP) 4.7 % 3.7 % 2025 Sales Compared to 2024 Total sales increased 6.0% on a year-over-year basis during 2025 as compared to 2024 primarily as a result of a 4.7% increase in core sales resulting from the factors discussed below by segment.
Veralto’s geographic and industry diversity, as well as the range of its products and services, help limit the impact of any one industry or the economy of any single country on its consolidated operating results.
As a diversified, global business, Veralto’s operations are affected by worldwide, regional and industry-specific economic and political factors. Veralto’s geographic and industry diversity, as well as the range of its products and services, help limit the impact of any one industry or the economy of any single country on its consolidated operating results.
Currency exchange rates and the impact of divestitures decreased reported sales by 0.4% and 0.3%, respectively, during 2024 as compared to 2023. Geographically, the increase in reported sales was driven by an increase of 6.5% in North America, partially offset by a decrease of 2.8% in high-growth markets.
Currency exchange rates and the impact of acquisitions, net of divestitures increased reported sales by 1.0% and 0.2%, respectively, during 2025 as compared to 2024. Geographically, the increase in reported sales was driven by an increase of 9.5% in Western Europe, 5.5% in high-growth markets, and 5.0% in North America.
Currency exchange rates decreased reported sales by 0.3% during 2024 as compared to 2023. The impact of acquisitions was flat on a year-over-year basis during 2024 as compared to 2023. Price increases contributed 1.8% to sales growth on a year-over-year basis during 2024 as compared to 2023 and is reflected as a component of core sales growth above.
Currency exchange rates and acquisitions, net of divestitures increased reported sales by 1.2% and 0.1%, respectively, during 2025 as compared to 2024. Price increases contributed 1.9% to sales growth on a year-over-year basis during 2025 as compared to 2024 and are reflected as a component of core sales growth above.
Operating Expenses Year Ended December 31 ($ in millions) 2024 2023 2022 Sales $ 5,193 $ 5,021 $ 4,870 Selling, general and administrative (“SG&A”) expenses (1,644) (1,536) (1,431) Research and development (“R&D”) expenses (253) (225) (217) SG&A as a % of sales 31.7 % 30.6 % 29.4 % R&D as a % of sales 4.9 % 4.5 % 4.5 % SG&A expenses as a percentage of sales increased 110 basis points on a year-over-year basis during 2024 as compared to 2023 primarily due to select investments in sales and marketing growth initiatives, as well as the costs to operate as a stand-alone company.
The gross profit margin increase was partially offset by incremental year-over-year materials and labor costs, and the impact of product mix. 29 Table of Contents Operating Expenses Year Ended December 31 ($ in millions) 2025 2024 2023 Sales $ 5,503 $ 5,193 $ 5,021 Selling, general and administrative (“SG&A”) expenses (1,756) (1,644) (1,536) Research and development (“R&D”) expenses (266) (253) (225) SG&A as a % of sales 31.9 % 31.7 % 30.6 % R&D as a % of sales 4.8 % 4.9 % 4.5 % SG&A expenses as a percentage of sales increased 20 basis points on a year-over-year basis during 2025 as compared to 2024 primarily due to incremental labor costs and sales and marketing growth initiatives.
Other financial transactions relating to the business operations of the Company during the period were accounted for through the Net Former Parent investment account of the Company.
Other financial transactions relating to the business operations of the Company during the period were accounted for through the Net Former Parent investment account of the Company. As a result of the Separation, the Company no longer participates in Danaher’s cash management and financing operations.
Gross profit margins increased 200 basis points on a year-over-year basis during 2024 as compared to 2023, driven by positive pricing actions and higher volume as discussed below and to a lesser extent lower material costs, and the impacts from foreign currency exchange rates.
Gross profit margins increased 10 basis points on a year-over-year basis during 2025 as compared to 2024, driven by positive pricing actions and higher volume as discussed below and to a lesser extent the net positive impact from the gross profit margin of recent acquisitions.
The following factors impacted year-over-year operating profit margin comparisons: 2024 vs. 2023 operating profit margin comparisons were favorably impacted by: • Higher 2024 core sales and incremental year-over-year cost savings associated with material costs, net of the impact of incremental year-over-year costs associated with labor and sales and marketing growth initiatives - 40 basis points 35 Table of Contents • One-time costs incurred in 2023 as a result of the Separation from Danaher - 10 basis points PRODUCT QUALITY & INNOVATION The Company’s Product Quality & Innovation segment provides equipment, consumables, software and services for various marking and coding, traceability, printing, packaging design and quality management, packaging converting and color and appearance management applications for consumer-packaged goods and industrial products.
The following factors impacted year-over-year operating profit margin comparisons: 2025 vs. 2024 operating profit margin comparisons were favorably impacted by: • Higher 2025 core sales driven by positive pricing actions and materials cost saving initiatives, partially offset by incremental labor and raw materials costs and the impact of product mix - 100 basis points 2025 vs. 2024 operating profit margin comparisons were unfavorably impacted by: • Costs incurred during 2025 related to certain strategic initiatives - 10 basis points 31 Table of Contents PRODUCT QUALITY & INNOVATION The Company’s Product Quality & Innovation segment provides equipment, consumables, software and services for various marking and coding, traceability, printing, packaging design and quality management, packaging converting and color and appearance management applications for consumer-packaged goods and industrial products.
The increase in core sales was driven primarily by the chemical treatment solutions business and to a lesser extent by the analytical instrumentation business, and the ultraviolet water disinfection and filtration business. Year-over-year core sales in the chemical treatment solutions business increased 7.2% as a result of higher core sales across most major end-markets.
The increase in core sales was driven primarily by the ultraviolet water disinfection and filtration business and the chemical treatment solutions business, and to a lesser extent the analytical instrumentation business. Core sales in the ultraviolet water disinfection and filtration business increased 6.0% in 2025, driven primarily by the municipal end-market.
Unless otherwise specified in the corresponding prospectus supplement, the Company expects to use net proceeds realized from future securities issuances off the Shelf Registration Statement for general corporate purposes, including without limitation repayment or refinancing of debt or other corporate obligations, acquisitions, capital expenditures, and working capital. 2023 Financing Transactions During 2023, the Company completed the following financing transactions: • Issued approximately $2.1 billion aggregate principal amount of senior unsecured notes in three series with maturity dates ranging from 2026 through 2033 (collectively, the “U.S.
Unless otherwise specified in the corresponding prospectus supplement, the Company expects to use net proceeds realized from future securities issuances off the Shelf Registration Statement for general corporate purposes, including without limitation repayment or refinancing of debt or other corporate obligations, acquisitions, capital expenditures, and working capital.
Our ability to meet our expectations are subject to numerous risks, including, but not limited to, those described in “Item 1A. Risk Factors” within this annual report. Acquisitions and Strategic Investments On October 4, 2024, the Company completed its acquisition of Information Exchange Holdings, Inc., the holding company that owns TraceGains, for $349 million, net of cash acquired.
Our ability to meet our expectations are subject to numerous risks, including, but not limited to, those described in “Item 1A. Risk Factors” within this Annual Report. Acquisitions On January 22, 2026, the Company completed the acquisition of In-Situ, Inc. (“In-Situ”), for a cash purchase price of approximately $427 million, net of cash acquired.
Business Performance The Company’s overall revenues for the year ended December 31, 2024 increased 3.4% as compared to 2023. Core sales for the year ended December 31, 2024 increased 3.7% as compared to 2023. Currency exchange rates decreased reported sales by 0.3%. For the definition of “core sales,” refer to “—Results of Operations” below.
Business Performance The Company’s overall revenues for the year ended December 31, 2025 increased 6.0% as compared to 2024. Core sales for the year ended December 31, 2025 increased 4.7% as compared to 2024. Currency exchange rates and acquisitions, net of divestitures increased reported sales by 1.2% and 0.1%, respectively.
Geographically, core sales growth was driven by increases of 6.2% in North America and 2.2% in Western Europe. Core sales were flat in high-growth markets, as a mid-single digits core sales increase in Latin America was mostly offset by a high-single digit percentage core sales decline in China.
Geographically, core sales growth was driven by increases of 5.2% in North America, 4.8% in high-growth markets, and 4.0% in Western Europe. Core sales growth in high-growth markets was driven by mid-single digit core sales increases in Latin America, partially offset by low-single digit core sales declines in China.
Refer to Note 9 to the Consolidated and Combined Financial Statements for a description of intangible asset impairment charges recorded during 2023. If actual results are not consistent with management’s estimates and assumptions, goodwill and other intangible assets may be overstated and a charge would need to be taken against net earnings which would adversely affect the Company’s financial statements.
If actual results are not consistent with management’s estimates and assumptions, goodwill and other intangible assets may be overstated and a charge would need to be taken against net earnings which would adversely affect the Company’s financial statements. Historically, the Company’s estimates of goodwill and intangible assets have been materially correct. Contingent Liabilities —As discussed in “Item 3.
The following factors impacted year-over-year operating profit margin comparisons. 2024 vs. 2023 operating profit margin comparisons were favorably impacted by: • The impact of Argentine Peso devaluation on operations during 2023 - 140 basis points • 2023 impairment charge related to customer relationships and a trade name - 60 basis points 36 Table of Contents • One-time costs incurred in 2023 as a result of the Separation from Danaher - 10 basis points • Higher 2024 core sales, foreign currency exchange rates and cost savings associated with continuing productivity improvement initiatives, partially offset by incremental labor and sales and marketing growth initiatives - 30 basis points 2024 vs. 2023 operating profit margin comparisons were unfavorably impacted by: • Costs incurred during 2024 related to certain strategic initiatives - 20 basis points • The net dilutive impact of 2024 acquisitions and dispositions - 30 basis points OTHER INCOME (EXPENSE), NET For a description of the Company’s other income (expense), net during the years ended December 31, 2024 and 2023, refer to Note 7 to the accompanying Consolidated and Combined Financial Statements.
The following factors impacted year-over-year operating profit margin comparisons. 2025 vs. 2024 operating profit margin comparisons were unfavorably impacted by: • The net dilutive impact during 2025 of acquisitions and dispositions - 20 basis points • Incremental labor and materials costs and sales and marketing growth initiatives, partially offset by higher 2025 core sales - 50 basis points 32 Table of Contents 2025 vs. 2024 operating profit margin comparisons were favorably impacted by: • Transaction costs incurred during 2024 related to the acquisition of TraceGains - 20 basis points OTHER INCOME (EXPENSE), NET For a description of the Company’s other income (expense), net during the years ended December 31, 2025 and 2024, refer to Note 7 to the accompanying Consolidated and Combined Financial Statements.
The Company will continue to have cash requirements to support general corporate purposes, which may include working capital needs, capital expenditures, acquisitions and investments, paying interest and servicing debt, paying taxes and any related interest or penalties, funding its restructuring activities and pension plans as required, paying dividends to shareholders, repurchasing shares of the Company’s common stock and supporting other business needs. 41 Table of Contents The Company generally intends to use available cash and internally generated funds to meet these cash requirements, but in the event that additional liquidity is required, the Company may also borrow under its commercial paper programs (if available) or borrow under the Company’s Credit Facility, enter into new credit facilities and either borrow directly thereunder or use such credit facilities to backstop additional borrowing capacity under its commercial paper programs (if available) and/or access the capital markets.
The Company generally intends to use available cash and internally generated funds to meet these cash requirements, but in the event that additional liquidity is required, the Company may also borrow under its commercial paper programs (if available) or borrow under the Company’s Credit Facility, enter into new credit 37 Table of Contents facilities and either borrow directly thereunder or use such credit facilities to backstop additional borrowing capacity under its commercial paper programs (if available) and/or access the capital markets.
The Company recorded a foreign currency translation loss of $139 million in 2024 primarily driven by the strengthening of the U.S. dollar against most major currencies in the period compared to a gain of $29 million in 2023 primarily driven by the weakening of the U.S. dollar against most major currencies in the period.
The foreign currency translation gains during 2025 were primarily driven by the weakening of the U.S. dollar against most major foreign currencies in the period. The foreign currency translation losses in 2024 were primarily driven by the strengthening of the U.S. dollar against most major currencies in the period.
INTEREST COSTS AND FINANCING For a discussion of the Company’s outstanding indebtedness, refer to Note 12 to the accompanying Consolidated and Combined Financial Statements. Net interest expense was $113 million during 2024 as compared to $30 million in 2023, arising from the Company’s outstanding indebtedness, which was incurred in September 2023.
INTEREST COSTS AND FINANCING For a discussion of the Company’s outstanding indebtedness, refer to Note 12 to the accompanying Consolidated and Combined Financial Statements.
As a result of the Separation, the Company no longer participates in Danaher’s cash management and financing operations. 40 Table of Contents Overview of Cash Flows and Liquidity Following is an overview of the Company’s cash flows and liquidity for the years ended December 31: ($ in millions) 2024 2023 2022 Net cash provided by operating activities $ 875 $ 963 $ 870 Cash paid for acquisitions, net of cash acquired $ (363) $ — $ (55) Payments for additions to property, plant and equipment (55) (54) (34) Proceeds from sales of property, plant and equipment — 2 — All other investing activities (16) (3) — Net cash used in investing activities $ (434) $ (55) $ (89) Proceeds from the issuance of common stock in connection with stock-based compensation $ 24 $ 4 $ — Net transfers to Former Parent — (147) (781) Consideration paid to Former Parent in connection with Separation — (2,600) — Proceeds from borrowings (maturities longer than 90 days) — 2,608 — Payment of dividends (89) Net cash used in financing activities $ (65) $ (135) $ (781) • Operating cash flows from continuing operations decreased $88 million, or 9%, during 2024 as compared to 2023, primarily due to cash interest payments of $137 million, cash tax payments of $293 million, increased operating expenses, and year-over-year increases in cash outflows related to accounts payable, prepaid expenses and other current assets partially offset by cash inflows from accrued expenses and other liabilities. • Net cash used in investing activities consisted primarily of cash paid for acquisitions and capital expenditures.
Please see Note 17 to the accompanying Consolidated and Combined Financial Statements for further information on the Company’s share repurchase program. 36 Table of Contents Overview of Cash Flows and Liquidity Following is an overview of the Company’s cash flows and liquidity for the years ended December 31: ($ in millions) 2025 2024 2023 Net cash provided by operating activities $ 1,077 $ 875 $ 963 Cash paid for acquisitions, net of cash acquired $ — $ (363) $ — Payments for additions to property, plant and equipment (63) (55) (54) All other investing activities (35) (16) (1) Net cash used in investing activities $ (98) $ (434) $ (55) Proceeds from issuance of common stock in connection with stock-based compensation $ 22 $ 24 $ 4 Net transfers to Former Parent — — (147) Consideration paid to Former Parent in connection with Separation — — (2,600) Proceeds from borrowings (maturities longer than 90 days) — — 2,608 Payment of dividends (109) (89) — All other financing activities (15) — — Net cash used in financing activities $ (102) $ (65) $ (135) • Operating cash flows increased $202 million, or 23%, during 2025 as compared to 2024, primarily due to higher net income, partially offset by changes in net working capital. • Net cash used in investing activities consisted primarily of capital expenditures and other investing activities, which is comprised of immaterial acquisition and disposition activity.

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