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

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

+407 added−426 removedSource: 10-K (2026-02-11) vs 10-K (2025-02-12)

Top changes in ENTEGRIS INC's 2025 10-K

407 paragraphs added · 426 removed · 319 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

142 edited+14 added−57 removed9 unchanged
Biggest changeOur offerings include: • CMP slurries, used for polishing a wide range of materials used in semiconductors, including tungsten, dielectric materials, copper, tantalum (commonly referred to as “barrier”), molybdenum, aluminum, silicon carbide (“SiC”) and gallium nitride (“GaN”); • CMP polishing pads, which are used in conjunction with slurries in the CMP process on a variety of polishing tools and wafers over a range of technology nodes and applications, including tungsten, copper, and dielectrics; • Formulated cleaning chemistries, which remove residues from wafer surfaces after the CMP process; • Filtration and purification solutions, which are used to remove select particles and contaminants from slurries and cleaning chemistries that can cause defects on a wafer’s surface; and • Process monitoring and control equipment, which maintain the integrity of the CMP slurries.
Biggest changeOur offerings include: • CMP slurries for polishing semiconductor materials, including tungsten, dielectric materials, copper, tantalum (commonly referred to as “barrier”), molybdenum, aluminum, silicon carbide (“SiC”) and gallium nitride (“GaN”); • CMP polishing pads used with slurries across a range of polishing tools, wafers, technology nodes and applications, including tungsten, copper, and dielectrics; • Formulated cleaning chemistries that remove residues from wafer surfaces after the CMP process; 2 Table of Contents • Filtration and purification solutions that remove select particles and contaminants from slurries and cleaning chemistries to prevent wafer defects; and • Process monitoring and control equipment to maintain CMP slurry integrity.
These segments share common business systems and processes, technology centers and technology roadmaps. • The Materials Solutions segment, or MS, provides materials-based solutions, such as chemical vapor and atomic layer deposition materials, chemical mechanical planarization (“CMP”) slurries and pads, ion implantation specialty gases, formulated etch and clean materials, and other specialty materials that enable our customers to achieve better device performance and faster time to yield, while providing for lower total cost of ownership. • The Advanced Purity Solutions segment, or APS, offers filtration, purification and contamination-control solutions that improve customers’ yield, device reliability and cost by ensuring the purity of critical liquid chemistries and gases and the cleanliness of wafers and other substrates used throughout semiconductor manufacturing processes, the semiconductor ecosystem and other high-technology industries.
These segments share common business systems and processes, technology centers and technology roadmaps. • The Materials Solutions segment, or MS, provides materials-based solutions, such as chemical vapor and atomic layer deposition materials, chemical mechanical planarization (“CMP”) slurries and pads, ion implantation specialty gases, formulated etch and clean materials, and other specialty materials that enable our customers to achieve better device performance and faster time to yield, while providing lower total cost of ownership. • The Advanced Purity Solutions segment, or APS, offers filtration, purification and contamination-control solutions that improve customers’ yield, device reliability and cost by ensuring the purity of critical liquid chemistries and gases and the cleanliness of wafers and other substrates used throughout semiconductor manufacturing processes, the semiconductor ecosystem and other high-technology industries.
We are committed to the ongoing training and development of our employees. We foster an on-the-job training and development culture by investing in rotational development programs in operations, supply chain, and engineering.
Talent Development and Training . We are committed to the ongoing training and development of our employees. We foster an on-the-job training and development culture by investing in rotational development programs in operations, supply chain, and engineering.
In addition, our fluid-handling products, such as tubing, valve, fittings and drum products, are used to safely store, transport and dispense volatile and dangerous chemistries, protecting those who work with them. Total Rewards .
Our fluid-handling products, such as tubing, valve, fittings and drum products, are used to safely store, transport and dispense volatile and dangerous chemistries, protecting those who work with them. Total Rewards .
Leveraging Our Collective Expertise . We leverage our expertise across our segments and broad portfolio of advanced materials, materials handling and purification capabilities to create innovative, new and co-optimized solutions to address unmet customer needs.
Leveraging Our Collective Expertise . We leverage expertise across our segments and broad portfolio of advanced materials, materials handling and purification capabilities to create innovative, new and co-optimized solutions addressing unmet customer needs.
Wafer and Reticle Transport . Our products, such as our front-opening unified pods (“FOUPs”), wafer transport and process carriers, standard mechanical interface pods (“SMIF pods”) and extreme ultraviolet (“EUV”) reticle pods, protect wafers and reticles from damage or abrasion and ensure purity during transportation and automated processing.
Wafer and Reticle Transport . Our products, including front-opening unified pods (“FOUPs”), wafer transport and process carriers, standard mechanical interface pods (“SMIF pods”) and extreme ultraviolet (“EUV”) reticle pods, protect wafers and reticles from damage or abrasion and ensure purity during transportation and automated processing.
In response, semiconductor architectures are changing and dimensions are shrinking, with transistor design increasing in complexity, the use of extreme ultraviolet lithography, multilayered patterning, and vertical structures such as FinFET, 3D NAND and GAA devices. These advanced technologies and architectures require more process steps, new and innovative materials and more sophisticated contamination control solutions.
In response, semiconductor architectures are changing and dimensions are shrinking, with increasing transistor complexity, extreme ultraviolet lithography, multilayered patterning, and vertical structures such as FinFET, 3D NAND and GAA devices. These advanced technologies and architectures require more process steps, new and innovative materials and sophisticated contamination control solutions.
Wafer and Package Testing . We develop and manufacture high-performance consumable products for cleaning advanced probe cards and test sockets at semiconductor manufacturing facilities and innovative polymer products for semiconductor fabs that improve front-end tool uptime and reduce operating costs. INDUSTRY TRENDS 3 Table of Contents Emerging and Existing Applications .
Wafer and Package Testing . We develop and manufacture high-performance consumable products for cleaning advanced probe cards and test sockets at semiconductor manufacturing facilities and innovative polymer products for semiconductor fabs that improve front-end tool uptime and reduce operating costs. INDUSTRY TRENDS Emerging and Existing Applications .
Existing applications in data processing, wireless communications, broadband infrastructure, personal computers, handheld electronic devices and other consumer electronics are also expected to drive demand for semiconductors, and in turn, for our products. Manufacturing Complexity and Device Architectures . Emerging applications require more powerful, faster and more energy-efficient semiconductors.
Existing applications in data processing, wireless communications, broadband infrastructure, personal computers and consumer electronics are also expected to drive demand for semiconductors, and in turn, for our products. Manufacturing Complexity and Device Architectures . Emerging applications require more powerful, faster and more energy-efficient semiconductors.
We maintain a network of service centers, applications laboratories and technology centers located in key markets internationally and in the U.S. to support our products and our customers with their advanced development needs, provide local technical service and application support and help ensure fast turnaround time. COMPETITION The market for our products and solutions is highly competitive.
We maintain a network of service centers, applications laboratories and technology centers in key U.S. and international markets to support our products and our customers with their advanced development needs, provide local technical service and application support and ensure fast turnaround. COMPETITION The market for our products and solutions is highly competitive.
Our broad range of fluid management solutions maximize fab productivity, improve fab yields and reduce cost of ownership throughout bulk chemical delivery, CMP, wet etch and clean and lithography processes.
Fluid Management Products . Our fluid management solutions maximize fab productivity, improve fab yields and reduce cost of ownership throughout bulk chemical delivery, CMP, wet etch and clean and lithography processes.
For example, certain of our formulated cleaning chemistry products are developed and manufactured by our MS segment, with collaboration from our filtration expertise in our APS segment, packaged with our ultra-clean container and connector system, delivered to the process tools through fluid handling systems each from our APS segment, and, in the process tools, may be purified through systems produced by our APS segment.
For example, certain of our formulated cleaning chemistry products are developed by our MS segment with collaboration from our filtration expertise in our APS segment, packaged with our ultra-clean container and connector system, and delivered to the process tools through fluid handling systems each from our APS segment.
We also license and expect to continue to license technology used in the manufacture and distribution of products from third parties. However, we do not consider any particular Company patent or third-party license to be material to our business. We vigorously protect and defend our intellectual property.
We also license, and expect to continue to license, certain patents and technology from third parties for use in the manufacture and distribution of our products; however, we do not consider any particular Company patent or third-party license to be material to our business. We vigorously protect and defend our intellectual property.
These segments collaborate to create new and increasingly integrated solutions for our customers, such as leveraging the purification and handling expertise of the APS segment to ensure maximum purity and stability of CMP slurries and cleans solutions from the MS segment and leveraging the advanced materials expertise from the MS segment in formulated cleaning chemistries and in slurry formulation to develop differentiated filtration and purification solutions in the APS segment.
These segments collaborate to create new and increasingly integrated solutions, for example, leveraging the purification and handling expertise of the APS segment to ensure purity and stability of CMP slurries and cleans solutions from the MS segment and leveraging the advanced materials expertise from the MS segment in formulated cleaning chemistries and in slurry formulation to develop differentiated filtration and purification solutions in the APS segment.
We believe the Board’s oversight of these matters helps identify and mitigate exposure to labor and human capital management risks, and is part of the broader framework that guides how we attract, retain and develop a workforce that aligns with our values and strategies.
The Board’s oversight helps identify and mitigate labor and human capital management risks, and is part of the broader framework that guides how we attract, retain and develop a workforce that aligns with our values and strategies.
We offer the following Deposition and Etch Solutions products: 7 Table of Contents Advanced Deposition Materials Products . Our advanced deposition materials include ultra-pure liquid and solid precursors, including organometallic and inorganic precursors for the deposition of molybdenum, tungsten, titanium, hafnium, zirconium, aluminum and other emerging metal and metal-based films.
We offer the following Molecular and Engineered Solutions products: Advanced Deposition Materials Products . Our advanced deposition materials include ultra-pure liquid and solid precursors, including organometallic and inorganic precursors for the deposition of molybdenum, tungsten, titanium, hafnium, zirconium, aluminum and other emerging metal and metal-based films.
Our ability to deliver advanced materials at high purity, together with critical products like CMP slurries and pads, enables our customers’ technical roadmap, improves device performance, enhances their yields and is critical to enabling the performance of leading-edge logic and memory devices.
Our ability to deliver advanced materials at high purity, together with critical products like CMP slurries and pads, enables our customers’ technical roadmaps, improves device performance, enhances yields and is critical to leading-edge logic and memory devices.
THE SEMICONDUCTOR ECOSYSTEM The manufacture of semiconductors requires hundreds of highly complex and sensitive manufacturing steps, during which a variety of materials are repeatedly applied to a silicon wafer to build integrated circuits on the wafer surface. The areas of the semiconductor ecosystem that rely most heavily on our products and solutions are described below. Photolithography .
THE SEMICONDUCTOR ECOSYSTEM Semiconductor manufacturing requires hundreds of complex, sensitive process steps in which a variety of materials are repeatedly applied to silicon wafers to build integrated circuits on the wafer surface. The areas of the semiconductor ecosystem that rely most heavily on our products and solutions are described below. Photolithography .
We provide solutions for the handling and ensuring the purity of such chemicals, including: • Ultra-high purity chemical container products, such as drums, flexible packaging and associated coded connection systems, which are designed to maintain chemical purity, maximize utilization and ensure safe transport, containment and dispense of valuable, ultra-clean process fluids, from bulk chemical manufacturing to point-of-use in the manufacturing process; and • Ultra-pure valves, fittings, tubings and sensing and control products, which are used to distribute these chemicals around the fab and in wet process tools.
We provide solutions for handling and ensuring the purity of these chemicals, including: • Ultra-high purity chemical container products, including drums, flexible packaging and associated coded connection systems, that maintain chemical purity, maximize utilization and ensure safe transport, containment and dispense of valuable, ultra-clean process fluids, from bulk chemical manufacturing to point-of-use in the manufacturing process; and • Ultra-pure valves, fittings, tubings and sensing and control products for chemical distribution throughout the fab and in wet process tools.
Customers Collaboration . We believe the strong relationships we have with our customers, which include leading logic and memory semiconductor manufacturers, original equipment manufacturers (“OEMs”) and semiconductor materials suppliers, are critical to our long-term success. We have built strong relationships with our customers through our expansive global presence, which allows us to engage with our customers where they operate.
We believe the strong relationships we have with our customers, including leading logic and memory semiconductor manufacturers, original equipment manufacturers (“OEMs”) and semiconductor materials suppliers, are 4 Table of Contents critical to our long-term success. We have built strong relationships with our customers through our global presence, which allows us to engage with our customers where they operate.
To meet our customers’ needs worldwide, we have established an extensive global manufacturing network with facilities in the U.S., Canada, China, Japan, Malaysia, Singapore, South Korea and Taiwan. Because we work in an industry where contamination control is paramount, we maintain Class 100 to Class 10,000 cleanrooms for manufacturing and assembly.
To meet our customers’ needs worldwide, we have established an extensive global manufacturing network with facilities in the U.S., Canada, China, Japan, Malaysia, Singapore, South Korea and Taiwan. Given the critical importance of contamination control in our industry, we maintain Class 100 to Class 10,000 cleanrooms for manufacturing and assembly.
We maintain a culture with an intense focus on safety and strive to identify, eliminate and control risk in the workplace in an effort to prevent injury and illness. Our employees have access to a global safety management system and are encouraged to report incidents, near misses or other observations in 13 Table of Contents the system.
Our success depends on the well-being of our employees. We maintain a culture with an intense focus on safety and strive to identify, eliminate and control workplace risk to prevent injury and illness. Our employees have access to a global safety management system and are encouraged to report incidents, near misses or other observations.
The competitive landscape is varied, ranging from business segments within large multinational companies to small regional or regionally-focused companies. While product quality and technology remain critical, industry trends indicate a shift to localized, cost-competitive and consolidated supply chains.
However, our competitive position varies by market segment and specific product area. The competitive landscape is varied, ranging from business segments within large multinational companies to small regional or regionally-focused companies. While product quality and technology remain critical, industry trends indicate a shift to localized, cost-competitive and consolidated supply chains.
Our CMP Pads, such as our NexPlanar™, Medea™ and Ultra pad products are designed to provide the exact hardness, pore sizes, compressibility, and groove patterns needed to meet and exceed the requirements of various CMP applications. Our Epic Power™ CMP Pads are designed for SiC wafers and offer a balance of best-in-class performance, quality, and cost of ownership.
Our CMP pads, such as our NexPlanar™, Medea™ and Ultra pad products provide the hardness, pore sizes, compressibility and groove patterns required for various CMP applications. Our Epic Power™ CMP Pads are designed for SiC wafers and offer a balance of best-in-class performance, quality and cost of ownership. Post-CMP Cleans and Brushes .
Our liquid and gas filtration and purification products are critical to semiconductor manufacturing processes, including photolithography, deposition, planarization and surface etching and cleaning, because they remove nanometer-sized contaminants, directly reduce defects, improve manufacturing yield and enhance the long-term reliability of the semiconductor device.
Our liquid and gas filtration and purification products are critical to semiconductor manufacturing processes, including photolithography, deposition, planarization and surface etching and cleaning, because they remove nanometer-sized contaminants, reducing defects, improving manufacturing yield and enhancing long-term device reliability.
In December 2024, we announced that we entered into a definitive agreement providing for up to $77.0 million in funding under the CHIPS and Science Act in connection with our Colorado Springs facility, with installments of such award based on achievement of agreed-upon milestones.
In December 2024, we announced a definitive agreement providing for up to $77.0 million in funding under the CHIPS and Science Act in connection with our Colorado Springs facility, with installments of such award based on key milestone achievements.
HUMAN CAPITAL RESOURCES We believe that our employees are a critical asset in achieving our mission of helping our customers improve their productivity, performance and technology by providing enhanced materials and process solutions for the most advanced manufacturing environments. In order to attract and retain top talent, we are focused on creating a diverse, inclusive and safe workplace.
HUMAN CAPITAL RESOURCES Our employees are critical to achieving our mission of helping customers improve their productivity, performance and technology by providing enhanced materials and process solutions for the most advanced manufacturing environments. To attract and retain top talent, we are focused on creating a diverse, inclusive and safe workplace with competitive total rewards and quality development and training opportunities.
To that end, as further described above, during 2023 and 2024, we completed the divestitures of QED, our EC business and our PIM business and terminated the Alliance Agreement with MacDermid Enthone. • We intend to continue to further pay down our debt, while also investing in research and development and the advanced manufacturing capabilities necessary to maintain and expand our technology leadership and to drive organic growth.
During 2023 and 2024, we completed the divestitures of QED, our EC business and our PIM business and terminated the Alliance Agreement with MacDermid Enthone. • We intend to continue paying down debt while investing in research and development and advanced manufacturing capabilities to maintain and expand our technology leadership and drive organic growth. Customers Collaboration .
These include: engineered polymer conversion and processing; specialty coating capabilities; advanced membrane modification and cleaning; solids and powders compounding and handling; chemical formulation, blending, synthesis and purification; graphite synthesis; gas delivery systems; blow molding; high-purity gas handling and transfilling; rotational molding; high-purity materials packaging; machining; and membrane casting; assembly. cartridge manufacturing and assembly; We have made significant investments in systems and equipment to create innovative products and tool designs, including metrology and 3D printing capabilities for rapid analysis and prototype production.
Our worldwide advanced manufacturing capabilities, which we believe are important competitive advantages, include: 10 Table of Contents engineered polymer conversion and processing; specialty coating capabilities; advanced membrane modification and cleaning; solids and powders compounding and handling; chemical formulation, blending, synthesis and purification; graphite synthesis; gas delivery systems; blow molding; high-purity gas handling and transfilling; rotational molding; high-purity materials packaging; machining; and membrane casting; assembly. cartridge manufacturing and assembly; We have invested significantly in systems and equipment to create innovative products and tool designs, including metrology and 3D printing capabilities for rapid analysis and prototype production.
AMM includes our POCO® premium graphite products, used to make precision consumable electrodes for electrical discharge machining, hot glass contact materials for glass product manufacturing and forming and other consumable products for various industrial applications, including aerospace, optical, medical devices, air bearings and printing.
Advanced Materials Markets (“AMM”) . AMM develops and sells products to customers in markets outside semiconductor manufacturing. AMM includes our POCO® premium graphite products for precision consumable electrodes for electrical discharge machining, hot glass contact materials for glass product manufacturing and forming and other consumable products for various industrial applications, including aerospace, optical, medical devices, air bearings and printing.
We believe the growing long-term demand in the advanced logic and memory market, the need to introduce new and innovative materials at advanced nodes with increasingly complex device design schemes and the importance of recess chemistries and specialized cleaning solutions will drive demand in our MS segment. Deposition and Etch Solutions .
We believe the growing long-term demand in advanced logic and memory, the need for new and innovative materials at advanced nodes with increasingly complex device designs, and the importance of recess chemistries and specialized cleaning solutions will drive demand in our MS segment. Molecular and Engineered Solutions .
Given the variability of business cycles in the semiconductor industry and the rapid response time required by our customers, it is critical that we be able to quickly adjust the size of our production staff to meet our customers’ demands and maximize efficiency and we use skilled temporary labor when possible.
Given the variability of business cycles in the semiconductor industry and the rapid response time required by our customers, we must be able to quickly adjust the size of our production staff to meet customer demands and maximize efficiency, using skilled temporary labor when appropriate.
We believe our comprehensive offering provides us with a competitive advantage, allowing us to meet a broad range of their needs and to serve customers in many aspects of the semiconductor manufacturing ecosystem.
We believe our comprehensive offering provides us with a competitive advantage, enabling us to meet a broad range of customer needs and to serve customers across the semiconductor manufacturing ecosystem.
To perform at the high level of our customers’ expectations, we intend to continue to invest in the following priorities: • Manufacturing equipment and facilities incorporating leading-edge process technology, including advanced cleanroom and cleaning procedures; • Automated manufacturing, statistical process controls, quality and supply chain management systems; and • A highly skilled and agile organization, capable of rapid design, prototyping and ramping to high volume manufacturing while promptly responding to new customer requirements and feedback.
We intend to continue investing in the following priorities: • Manufacturing equipment and facilities with leading-edge process technology, including advanced cleanroom and cleaning procedures; • Automated manufacturing, statistical process controls and quality and supply chain management systems; and • A skilled, agile organization capable of rapid design, prototyping and high volume manufacturing ramp while promptly responding to customer requirements.
Our instrumentation solutions ensure consistency and monitoring of complex blended chemistries, such as our on-tool Accusizer® system, which performs automated online particle size and count analysis with applications in both semiconductor and life science industries, and our SemiChem® systems and our Invue® products, which measure chemical concentration in CMP slurries and formulated cleaning chemistries.
Our instrumentation solutions ensure consistency and monitoring of complex blended chemistries, including our on-tool Accusizer® system for automated particle size and count analysis in semiconductor and life science applications, and our SemiChem® systems and Invue® products for measuring chemical concentration in CMP slurries and formulated cleaning chemistries.
Furthermore, as the semiconductor industry looks to new interconnect metals like molybdenum, our portfolio of deposition precursors, CMP slurries and pads, post-CMP cleans and selective etch formulations, combined with our filtration, sensing, and delivery products will enable us to create complementary solutions and enable our customers to enhance their device performance and optimize time to yield.
As the semiconductor industry adopts new interconnect metals like molybdenum, our portfolio of deposition precursors, CMP slurries and pads, post-CMP cleans and selective etch formulations, combined with our filtration, sensing and delivery products, enables us to create complementary solutions that enhance device performance and optimize time to yield. Strategic Acquisitions, Partnerships and Related Transactions .
We offer a broad portfolio of products designed to remove particulate and molecular contaminants from controlled environments and gas streams in semiconductor, flat panel display and LED fabs. Our Wafergard® gas filters reduce outgassing and remove particle contamination.
We also provide membrane and liquid filtration offerings serving semiconductor, pharmaceutical and medical applications. Gas Microcontamination Control Products . We offer a broad portfolio of products designed to remove particulate and molecular contaminants from controlled environments and gas streams in semiconductor, flat panel display and LED fabs. Our Wafergard® gas filters reduce outgassing and remove particle contamination.
Our product offerings that are used throughout the photolithography process include: • Liquid filtration, high-purity packaging and high-precision dispense systems designed to ensure the pure, accurate and uniform distribution of contamination-free photoresists onto the wafer, enabling manufacturers to achieve optimum yields in the manufacturing process; and • Gas microcontamination control solutions designed to eliminate airborne contaminants that can disrupt effective photolithography processes.
Our products used throughout this process include: • Liquid filtration, high-purity packaging and high-precision dispense systems that ensure pure, accurate and uniform distribution of contamination-free photoresists onto the wafer, enabling optimum yields; and • Gas microcontamination control solutions that eliminate airborne contaminants that can disrupt the photolithography processes. Etch and Resist Strip .
As a result, our revenue is generally more impacted by overall global semiconductor demand and global GDP growth, rather than the sales of semiconductor capital equipment, which has historically been more cyclical. • Our solutions are increasingly specified into our customers’ manufacturing processes and tailored to meet our customers’ unique process conditions and technical roadmaps.
Our revenue is therefore more impacted by global semiconductor demand and GDP growth than by semiconductor capital equipment sales, which have historically been more cyclical. • Our solutions are increasingly specified into our customers’ manufacturing processes and tailored to their unique process conditions and technical roadmaps.
While we seek to have several sources of supply for raw materials, certain materials included in our products, such as certain filtration membranes and polymer resins in our APS segment and certain engineered abrasive particles, specialty and commodity chemicals and petroleum coke in our MS segment, are obtained from a single source, a limited group of suppliers or from suppliers in a single country.
However, certain raw materials and components—such as certain filtration membranes and polymer resins in our APS segment and certain engineered abrasive particles, specialty and commodity chemicals and petroleum coke in our MS segment—are obtained from a single source, a limited group of suppliers or from suppliers in a single country.
The annual corporate social responsibility report is published on our website at http://www.Entegris.com under “About Us - Corporate Social Responsibility”. OUR SEGMENTS Following a change in our organization structure in the fourth quarter of 2024, our business is organized and operated in two segments: Materials Solutions, or MS, and Advanced Purity Solutions, or APS.
Our annual CSR report is published on our website at http://www.Entegris.com under “About Us - Corporate Social Responsibility”. OUR SEGMENTS Our business is organized and operated in two segments: Materials Solutions, or MS, and Advanced Purity Solutions, or APS.
Finally, we regularly evaluate opportunities for strategic alliances, joint development programs and other strategic investments to achieve a variety of objectives including expanding our manufacturing capacity, producing products closer to our customers, developing optimized products more quickly and developing new sources of supply to provide us with a competitive advantage. Adjacent Markets .
We also evaluate opportunities for strategic alliances, joint development programs and other strategic investments to achieve a variety of objectives including expanding our manufacturing capacity, producing products closer to our customers, accelerating product development and developing new supply sources. Adjacent Markets .
Chemical Mechanical Planarization . CMP is a polishing process used by semiconductor manufacturers to planarize, or flatten, many of the layers of material that have been deposited on silicon wafers.
CMP is a polishing process used to planarize, or flatten, layers of material that have been deposited on silicon wafers.
We offer a range of materials used to prepare the surface of a semiconductor wafer during the manufacturing process and to integrate with materials being used on the wafer. We offer a broad range of cleaning solutions for applications such as semiconductor post-etch residue removal, wafer etching, organics removal, resist removal, edge bead removal and corrosion prevention.
We offer a range of materials used to prepare semiconductor wafer surfaces during the manufacturing process and to integrate with materials on the wafer. Our etch cleaning solutions address applications including post-etch residue removal, wafer etching, organics removal, resist removal, edge bead removal and corrosion prevention. We also offer selective etch products designed for advanced architectures such as 3D-NAND.
Protection of processed wafers is essential to our customers because wafer processing involves hundreds of steps and can take several weeks, making the scrapping of damaged wafers very costly. Chemical Handling . Semiconductor manufacturing and other high-technology manufacturing processes utilize large volumes of high-purity and hazardous chemicals.
This protection is essential because wafer processing involves hundreds of steps over several weeks, making damaged wafers costly to scrap. Chemical Handling . Semiconductor and other high-technology manufacturing processes use large volumes of high-purity and hazardous chemicals.
MATERIALS SOLUTIONS SEGMENT MS provides complementary materials solutions around the primary modules in the semiconductor manufacturing process and in the emerging area of advanced packaging, including deposition materials, integrated circuit CMP solutions, high-performance etch and clean chemistries, gases and materials, and safe and efficient materials delivery systems that enhance our customers’ product performance.
The following is a detailed description of our segments. MATERIALS SOLUTIONS SEGMENT MS provides complementary materials solutions for semiconductor manufacturing and advanced packaging, including deposition materials, integrated circuit CMP solutions, high-performance etch and clean chemistries, gases and materials, and safe and efficient materials delivery systems that enhance our customers’ product performance.
We offer a variety of products that control contaminants in our customers’ wet processes both in the fab environment and upstream at the chemical manufacturers. For example, our Torrento® series of filters is used for the filtration of aggressive acid and base chemistries for both semiconductor fabs as well as specialty chemical manufacturers, including our MS segment.
Liquid Microcontamination Control Products . We offer products that control contaminants in our customers’ wet processes in the fab environment and upstream at the chemical manufacturers. Our Torrento® filtration solutions are used for aggressive acid and base chemistries for semiconductor fabs and specialty chemical manufacturers, including our MS segment.
We use sophisticated methodologies to research, develop and characterize our materials and products. Our capabilities to test and characterize our materials and products are focused on continuously reducing risks and threats to the integrity of the critical materials that our customers use in their manufacturing processes.
Using sophisticated methodologies, we research, develop and characterize our materials and products to reduce risks to the integrity of critical materials that our customers use in their manufacturing processes.
Our ability to meet our customers’ expectations, combined with our substantial investments in worldwide manufacturing capacity and comprehensive supply chain strategy, positions us well to respond to the increasing demands from our customers for yield-enhancing materials and solutions.
Our solutions provide purity, cleanliness, consistent performance, dimensional precision and stability. Our ability to meet customer expectations, combined with our substantial investments in worldwide manufacturing capacity and comprehensive supply chain strategy, positions us well to respond to increasing demands for yield-enhancing materials and solutions.
Additionally, we owned about 2,300 pending patent applications globally. We also license certain patents owned by third parties. We rely on a combination of patent, copyright, trademark and trade secret laws and license agreements to establish and protect our proprietary rights. We seek to refresh our intellectual property on an ongoing basis through continued innovation.
We rely on a combination of patent, copyright, trademark and trade secret laws and license agreements to establish and protect our proprietary rights, and we seek to refresh our intellectual property on an ongoing basis through continued innovation.
On June 5, 2023, the Company terminated an Alliance Agreement (the “Alliance Agreement”) between the Company and MacDermid Enthone Inc., a global business unit of Element Solutions Inc (“MacDermid Enthone”). In connection with the termination of the Alliance Agreement, Entegris received net proceeds of approximately $191.2 million.
On June 5, 2023, the Company terminated an Alliance Agreement (the “Alliance Agreement”) between the Company and MacDermid Enthone Inc., a global business unit of Element Solutions Inc (“MacDermid Enthone”).
Operational Excellence . Our customers are increasingly focused on the effectiveness, dependability, resiliency and consistency of their supply chains. Our strategy is to continue to develop and enhance our extensive supply chain and manufacturing capabilities into a competitive advantage by driving operational excellence, operating in a manner that ensures the safety of our employees and the quality of our products.
Our customers are increasingly focused on the effectiveness, dependability, resiliency and consistency of their supply chains. Our strategy is to continue to develop our supply chain and manufacturing capabilities into a competitive advantage through operational excellence, ensuring employee safety and product quality.
Our Chambergard™ gas diffusers provide semiconductor equipment manufacturers with the capability to rapidly vent their tools to atmosphere to dramatically reduce process cycle times without adding particles to the wafers. In addition, our Vaporsorb products are used to eliminate airborne molecular contamination from critical process tool areas or cleanrooms in the fab.
Our Chambergard™ gas diffusers enable semiconductor equipment manufacturers to rapidly vent tools to reduce process cycle times without adding particles to wafers. Our Vaporsorb products eliminate airborne molecular contamination from critical process tool areas or cleanrooms in the fab. These products are used in or alongside critical processing tools to improve yield and reduce tool downtime. Microenvironment Solutions .
On March 1, 2024, the Company completed the sale of its Pipeline and Industrial Materials (“PIM”) business, to SCF Partners, Inc. The Company received gross cash proceeds of $263.2 million, or net proceeds of $256.2 million, and up to $25.0 million in cash earn-out payments contingent upon the performance of the PIM business in 2025 and 2026.
The Company received gross cash proceeds of $263.2 million, or net proceeds of $256.2 million, and up to $25.0 million in cash earn-out payments contingent upon the performance of the PIM business in 2025 and 2026.
Global Infrastructure . We have a global infrastructure of design, manufacturing, logistics, distribution, service and technical support facilities to meet the needs of our global customers. We further enhanced this footprint with the opening of a new manufacturing center of excellence in Taiwan, our KSP facility, in May 2023, which will become our largest manufacturing facility.
Global Infrastructure . We maintain a global infrastructure of design, manufacturing, logistics, distribution, service and technical support facilities to meet the needs of our global customers. We further enhanced this footprint with our KSP facility in Taiwan, our new Colorado Springs manufacturing facility, and a new tech center in South Korea.
For example, we have the capabilities and core competencies to develop and co-optimize offerings solving customers’ complex manufacturing challenges across the deposition, CMP process and post-CMP modules, with solutions including advanced deposition materials, CMP slurries, pads and post-CMP cleaning chemistries (each from our MS segment), and CMP slurry filters, high-purity packaging and fluid monitoring systems (each from our APS segment).
We address complex manufacturing challenges across deposition, CMP and post-CMP modules with solutions including advanced deposition materials, CMP slurries, pads and post-CMP cleaning chemistries (each from our MS segment), and CMP slurry filters, high-purity packaging and fluid monitoring systems (each from our APS segment).
Furthermore, as 4 Table of Contents we continue to achieve greater scale, for example, through the acquisition of CMC Materials, we believe we will better serve our customers, be able to invest more in engineering, research and development (“ER&D”) and bring complementary, co-optimized solutions to market faster than ever before. Continued Consolidation .
We have established tech centers and manufacturing capabilities in strategic locations to better collaborate with and serve our customers. As we achieve greater scale, for example through the acquisition of CMC Materials, we will be able to better serve our customers, invest more in engineering, research and development (“ER&D”) and bring complementary, co-optimized solutions to market faster. Continued Consolidation .
At the time of the termination, the transaction had not received clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. On March 1, 2023, the Company completed the sale of QED Technologies International, Inc. (“QED”), which became part of the Company with the acquisition of CMC Materials, to an affiliate of Quad-C Management, Inc. for $134.3 million.
On March 1, 2023, the Company completed the sale of QED Technologies International, Inc. (“QED”), which became part of the Company with the acquisition of CMC Materials, to an affiliate of Quad-C Management, Inc. for $134.3 million.
Our products used during the ion implant process include: • Implant process gases and mixtures in our Safe Delivery Source® (“SDS®”) and Vacuum Actuated Cylinders (“VAC®”) gas delivery systems, designed to ensure the safe, effective and efficient delivery of these materials; and • Electrostatic chucks and proprietary low temperature plasma coating processes for core components, which are critical elements of ion implantation equipment.
Our products used during ion implant include: • Implant process gases and mixtures delivered through our Safe Delivery Source® (“SDS®”) and Vacuum Actuated Cylinders (“VAC®”) systems for safe, effective and efficient delivery; and • Electrostatic chucks and proprietary low-temperature plasma coatings for core components critical to ion implantation equipment. Chemical Mechanical Planarization .
Manufacturers of high purity chemicals and semiconductor fabs use our Trinzik® and Microgard™ products for the filtration of chemicals and ultra-pure water. Our Impact® series of filters are used in point-of-use photochemical dispense applications where the delivery of superior flow rate performance and reduced microbubble formation is critical.
Our Trinzik® and Microgard™ products filter chemicals and ultra-pure water for high purity chemical manufacturers and semiconductor fabs. Our Impact® filtration solutions are used in point-of-use photochemical dispense applications requiring superior flow rate performance and reduced microbubble formation. Our Protego® solutions reduce metallic contamination in chemical manufacturing and critical wafer rinsing and drying applications.
Item 1. Business. OUR COMPANY Entegris, Inc. (“Entegris”, “the Company”, “us”, “we”, or “our”) is a leading supplier of critical advanced materials and process solutions for the semiconductor and other high-technology industries. We leverage our unique breadth of capabilities to help our customers improve their productivity, product performance and technology in the most advanced manufacturing environments.
Item 1. Business. OUR COMPANY Entegris, Inc. (“Entegris”, “the Company”, “us”, “we”, or “our”) is a leading supplier of critical advanced materials and process solutions for the semiconductor and other high-technology industries.
Therefore, switching away from our products may be costly and time-consuming for our customers and may introduce risk to their manufacturing yields. • We have a broad product portfolio that is not overly concentrated on any single product or product platform.
We collaborate closely with our customers to create complementary solutions across platforms and modules, optimizing value and accelerating time to yield. Switching away from our products may be costly and time-consuming for our customers and may introduce risk to their manufacturing yields. • Our broad product portfolio is not overly concentrated on any single product or product platform.
We also have solutions, such as FOUPs and high-purity drums, that ensure the purity of and protect critical materials throughout the fabrication process, allowing our customers to store, process and transport critical materials in ultra-pure environments throughout the manufacturing process.
Solutions such as FOUPs and high-purity drums ensure purity and protect critical materials throughout fabrication, allowing customers to store, process and transport critical 3 Table of Contents materials in ultra-pure environments throughout the manufacturing process. We believe that the trend for greater materials purity will provide opportunities for our innovative materials management, filtration, purification, transport and process solutions.
We develop, produce, and sell CMP slurries for polishing a wide range of materials used in semiconductor devices, including tungsten, dielectric materials, copper, barrier, aluminum, and other emerging materials used in semiconductor device fabrication.
We develop, produce and sell CMP slurries for polishing a wide range of materials used in semiconductor devices, including tungsten, dielectric materials, copper, barrier, aluminum and other emerging materials. We believe that we are uniquely positioned to develop and optimize new slurries for emerging materials such as molybdenum. Substrates.
We are continuously expanding and delivering technical and leadership training for internal talent through our Entegris Great Leader Profile, Management Achievement, and Supervisor Training programs that are aimed at advancing leadership and management skills for current and future career growth. Employees are provided feedback and continuous development discussions through formal and informal review sessions throughout the year.
We continuously expand technical and leadership training through our Entegris Great Leader Profile, Management Achievement, and Supervisor Training programs to advance leadership and management skills for career growth. Employees receive feedback and development discussions through formal and informal review sessions throughout the year.
For example, our IntelliGen® integrated, high-precision liquid dispense systems enable the uniform application of advanced chemistries during the wafer fabrication process, integrating our valve control expertise with filter device technologies, in order to conserve high-value chemistry and reduce defects on wafers.
Our proprietary digital flow control technology improves chemical uniformity on wafers. Our IntelliGen® high-precision liquid dispense systems enable uniform application of advanced chemistries, integrating our valve control expertise with filter device technologies to conserve high-value chemistry and reduce defects.
OUR COMPETITIVE STRENGTHS AND BUSINESS STRATEGY We believe that our platform is well-positioned and sets us apart from our competitors for several reasons. • In 2024, our revenue was predominantly unit driven or recurring in nature, from products repeatedly consumed as a result of the semiconductor manufacturing process.
OUR COMPETITIVE STRENGTHS AND BUSINESS STRATEGY We believe our platform is well-positioned for several reasons. • In 2025, our revenue was predominantly unit-driven or recurring from products consumed during semiconductor manufacturing.
Over the last several years we have also invested in expanding our capacity and capabilities at our existing facilities to meet existing and anticipated demand, including adding new capacity in liquid filtration in Billerica, Massachusetts and Yonezawa, Japan, in deposition materials in Toronto, Ontario, in materials handling in Chaska, Minnesota and JangAn, Korea, in CMP filter and CMP slurries in Taiwan, in SiC slurries in Aurora, Illinois and in solid precursors in Burnett, Texas.
We have also expanded capacity at existing facilities, including liquid filtration in Billerica, Massachusetts and Yonezawa, Japan, deposition materials in Toronto, Ontario, materials handling in Chaska, Minnesota and JangAn, Korea, CMP filter and CMP slurries in Taiwan, SiC slurries in Aurora, Illinois and solid precursors in Burnet, Texas. Operational Excellence .
Photolithography, a process repeated during semiconductor fabrication, is used to print complex circuit patterns onto the wafer. During this process, the wafer is coated with a thin film of light-sensitive material, called photoresist. Light is projected to expose the photoresist, which is then developed to create a pattern.
Photolithography is a process used to print complex circuit patterns onto wafers. The wafer is coated with a thin film of light-sensitive photoresist, exposed to light, and developed to create the pattern.
While we continue to search for new perspectives and insights with external hires, we also seek to provide opportunities for our employees to grow their careers at the Company and regularly fill open vacancies with internal candidates.
While we continue to search for new perspectives with external hires, we also provide opportunities for employees to grow their careers at the Company and regularly fill open vacancies with internal candidates. Management systematically assesses succession planning for key positions and identifies high potential employees for future growth and development. Oversight .
Advanced Cleaning Materials . We develop and manufacture high-performance consumable products for cleaning advanced probe cards and test sockets, designed to improve customer yields and throughput in wafer and package test operations at semiconductor device manufacturers, foundries, and outsourced semiconductor assembly and test (“OSAT”) facilities. Integrated Circuits (“IC”) Polishing Solutions .
We develop and manufacture high-performance consumable products for cleaning advanced probe cards and test sockets, improving yields and throughput in wafer and package test operations at semiconductor device manufacturers, foundries and outsourced semiconductor assembly and test (“OSAT”) facilities. Formulated Solutions . Our Formulated Solutions business leverages our CMP and related capabilities to provide the following products: CMP Slurries .
We require each of our employees, including our executive officers, to enter into agreements with us pursuant to which the employee agrees to keep our proprietary information confidential and to assign to us inventions made during the course of employment.
We require each of our employees, including our executive officers, to enter into agreements to keep our proprietary information confidential and to assign to us inventions made during the course of employment. We also require outside scientific collaborators, sponsored researchers and other advisors and consultants who receive confidential information to execute confidentiality agreements with us.
Our strategy is to secure various sources of different raw materials, as appropriate, to enable the desired performance of our products, and monitor those sources as necessary to provide supply assurance.
RAW MATERIALS Our products are made from a wide variety of raw materials that are generally available from multiple sources of supply, and our strategy is to secure diverse sources to enable the desired performance of our products and monitor those sources as necessary to provide supply assurance.
For example, we have introduced sub-5 nanometer filtration products, advanced deposition materials for next generation transistor and interconnect technologies, polishing slurry and pad solutions with post-cleaning formulations to meet the needs of advanced memory applications, selective etching formulations for advanced device applications, advanced reticle pods for EUV photolithography applications, advanced 300 millimeter wafer carriers and advanced coatings to meet the rigorous defectivity specifications for the manufacturing of advanced technology nodes.
Recent product introductions include liquid filtration and purification products currently being utilized in 2 nanometer node production, advanced deposition materials for next generation transistor and interconnect technologies, polishing slurry and pad solutions with post-cleaning formulations for advanced memory applications, selective etching formulations for advanced device applications, advanced reticle pods for EUV photolithography applications, advanced 300 millimeter wafer carriers and advanced coatings meeting rigorous defectivity specifications for advanced technology node manufacturing.
We also offer a front-opening shipping box (“FOSB”) for the transportation and automated interface of 300 millimeter wafers. Our EUV reticle pod is designed to provide defect-free protection of EUV reticles during shipping, storage, handling, and vacuum-transferring operations. 9 Table of Contents Fluid Management Products .
Our Ultrapak® products for wafers ranging from 100 to 200 millimeters ensure the clean and secure transport of wafers from wafer manufacturers to semiconductor fabs. We also offer a front-opening shipping box (“FOSB”) for the transportation and automated interface of 300 millimeter wafers. Our EUV reticle pod provides defect-free protection of EUV reticles during shipping, storage, handling and vacuum-transferring operations.
Below is a table showing the percentage of our net sales to top customers and the percentage of our net sales that are international during the three most recent fiscal years. 2024 2023 2022 Percentage of net sales to top customers: TSMC 16% 11% 12% Remaining top ten customers 32% 32% 31% Total top ten customers 48% 43% 43% Percentage of net sales by market: Domestic/U.S. 21% 25% 24% Foreign/International 79% 75% 76% We may enter into supply agreements with our customers.
The following table shows the percentage of our net sales to top customers and the percentage of our net sales that are domestic and international during the three most recent fiscal years. 8 Table of Contents 2025 2024 2023 Percentage of net sales to top customers: Taiwan Semiconductor Manufacturing Company (TSMC) 16% 16% 11% Remaining top ten customers 34% 32% 32% Total top ten customers 50% 48% 43% Percentage of net sales by market: Domestic/U.S. 18% 21% 25% Foreign/International 82% 79% 75% We may enter into supply agreements with our customers, though these agreements typically do not include long-term purchase commitments.
Electronics & Industrial division of DuPont de Nemours, Inc. Cobetter Filtration Electronics Advanced Materials division of Air Liquide Gudeng Precision Industrial Linde plc Aicello Corporation Anji Microelectronics (Shanghai) Co., Ltd Mersen ENGINEERING, RESEARCH AND DEVELOPMENT We believe that technology is important to the success of our businesses.
Cobetter Filtration Electronics Advanced Materials division of Air Liquide Gudeng Precision Industrial Linde plc Aicello Corporation Anji Microelectronics (Shanghai) Co., Ltd Mersen ENGINEERING, RESEARCH AND DEVELOPMENT We believe that technology is critical to our success. We plan to continue to invest significantly in ER&D, balancing short-term market needs with longer-term initiatives.
While we expect that capital expenditures will be necessary to ensure that our manufacturing facilities remain in compliance with environmental and health and safety laws, we do not expect these expenditures to be material. See “Item 1A. Risk Factors” for a more detailed description of the regulatory risks we face.
However, new or more stringent requirements or enforcement policies could be adopted, which could adversely affect us. We expect capital expenditures will be necessary to maintain compliance with environmental and health and safety laws, but we do not expect these expenditures to be material. See “Item 1A. Risk Factors” for a more detailed description of the regulatory risks we face.
Products and emerging applications such as artificial intelligence, high-performance and cloud computing, smartphones, wearable technology, self-driving vehicles, the Internet of Things, gaming and virtual reality, and smart healthcare will require faster, more powerful, more compact and more energy efficient semiconductors.
Many products and emerging applications—including artificial intelligence (“AI”), high-performance and cloud computing, smartphones, wearable technology, electric and autonomous vehicles, the Internet of Things, gaming, virtual/augmented reality, and smart healthcare— are expected to drive long-term secular demand for semiconductor and require faster, more powerful, more compact and more energy efficient semiconductors.
It also includes our slurry products used for polishing bare silicon wafers and other ultra-hard surface materials, including SiC and GaN substrates as well as disk substrates and magnetic heads used in hard disk drives, which are utilized in power electronics and advanced communications end-markets.
We also offer slurry products for polishing bare silicon wafers and other ultra-hard surface materials, including SiC and GaN substrates and disk substrates and magnetic heads used in hard disk drives for power electronics and advanced communications end-markets. CMP Pads . CMP pads are critical in the CMP process to flatten and polish wafers and can significantly impact process performance.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeFactors that may cause our financial results to fluctuate unpredictably include: • legal, tax, accounting or regulatory changes (including changes in import/export regulations and tariffs, such as regulations imposed by the U.S. government restricting exports to China) or changes in the interpretation or enforcement of existing requirements; • trends in the semiconductor industry, macroeconomic and market conditions and geopolitical uncertainty, including impacts caused by the Russian invasion of Ukraine, the war between Israel and Hamas, conflict and resulting political instability in the Middle East or bank failures; • customer considerations, including the size and timing of customer orders, customers’ decisions to accelerate, decelerate or delay shipments, customers’ decisions on how to manage their inventory, customers’ rate of replacement of our consumable products or their decisions to delay expansion projects, and the consolidation of our customers, which may impact their future purchasing decisions; • procurement shortages, increased prices, the failure of suppliers to perform their obligations and additional expenses we may incur to respond promptly to mitigate any supply shortages or other supplier problems; • changes in our capital expenditure requirements, such as our new facilities in Taiwan and Colorado, and the schedule and timing, including potential delays, thereof; • unanticipated manufacturing difficulties; • changes in average selling prices, customer mix and product mix; • our ability to develop, introduce and market new, enhanced and competitive products in a timely and cost-effective manner; • our competitors’ introduction of new products; • disruptions in transportation, communication, demand, information technology (“IT”) or supply resulting from factors outside of our control, including strikes, acts of God, wars, terrorist activities, international conflict and natural or man-made disasters; and 17 Table of Contents • foreign currency exchange rate fluctuations.
Biggest changeFactors that may negatively impact the demand for our solutions or cause our financial results to fluctuate unpredictably include, but are not limited to: • decreased consumer spending or changes in purchasing habits related to (1) macroeconomic uncertainty, market conditions, slow or negative economic growth or uncertainty about economic and other policies; or (2) geopolitical instability, including the Russian invasion of Ukraine and conflicts in the Middle East; • trends in the semiconductor industry and demand trends for different types of electronic devices such as logic versus memory integrated circuit (“IC”) devices, or digital versus analog IC devices, and the various technology nodes at which those products are manufactured; • customer considerations, which may impact their future purchasing decisions, including (1) the size and timing of customer orders; (2) customers’ decisions to accelerate, decelerate or delay shipments; (3) customer inventory management and corrections; (4) customers’ rate of use and replacement of our consumable products; (5) customers’ decisions to delay expansion projects; (6) customers’ device architectures and specific manufacturing processes; (7) consolidation of our customers; and (8) the relative success of our customers vis-à-vis each other; • the short order-to-delivery time for our products; market share and competitive losses; and pricing changes by us and our competitors; • legal, tax, accounting or regulatory changes (including changes in import/export regulations and tariffs, such as regulations imposed by the U.S. government restricting exports to China or regulations imposed by other countries restricting the export of certain materials or the re-export of products containing such materials, or potential additional tariffs on imports, and tariffs imposed by other countries) or changes in the interpretation or enforcement of existing requirements; • procurement shortages and related increased prices, and the failure of suppliers to perform their obligations; • changes in our capital expenditure requirements to meet demand for our solutions, and the schedule and timing, including potential delays, thereof; • unanticipated manufacturing difficulties; • changes in average selling prices, customer mix and product mix; • our ability to develop, introduce and market new, enhanced and competitive products in a timely and cost-effective manner; • our competitors’ introduction of new products; • disruptions in transportation, communication, demand, IT or supply resulting from factors outside of our control, including strikes, acts of God, wars, terrorist activities, international conflict and natural or man-made disasters; and • foreign currency exchange rate fluctuations.
Cybersecurity threats may target us directly or indirectly through our third-party providers and global supply chain. Cybersecurity attacks are increasing in number and the attackers are increasingly organized and well-financed, or at times supported by state actors. Geopolitical tensions or conflicts, such as Russia’s invasion of Ukraine and increasing tensions with China, have created a heightened risk of cybersecurity attacks.
Cybersecurity threats may target us directly or indirectly through our third-party providers and global supply chain. Cybersecurity attacks are increasing in number and the attackers are increasingly organized and well-financed, or at times supported by state actors. Geopolitical tensions or conflicts, such as Russia’s invasion of Ukraine and tensions with China, have created a heightened risk of cybersecurity attacks.
We also are or may become subject to new climate and sustainability laws and regulations, such as the State of California’s new climate change disclosure rules, the EU’s Corporate Sustainability Reporting Directive and the SEC’s rules on climate-related risks.
We also are or may become subject to new climate and sustainability laws and regulations, such as the State of California’s climate change disclosure rules, the EU’s Corporate Sustainability Reporting Directive and the SEC’s rules on climate-related risks.
Further changes to or our failure to comply with these and similar regulations could (1) restrict our ability to expand, build or acquire new facilities, (2) require us to acquire costly control equipment, (3) cause us to incur expenses associated with remediation of contamination, (4) cause us to modify our product design, operations or manufacturing or shipping processes or (5) otherwise increase our cost of doing business, which may have a negative impact on our financial condition, results of operations and cash flows.
Further changes to, or our failure to comply with, these and similar regulations could (1) restrict our ability to expand, build or acquire new facilities, (2) require us to acquire costly control equipment, (3) cause us to incur expenses associated with remediation of contamination, (4) cause us to modify our product design, operations, manufacturing or shipping processes or (5) otherwise increase our cost of doing business, which may have a negative impact on our financial condition, results of operations and cash flows.
These transactions involve numerous risks to our business, financial condition and operating results, including but not limited to: • difficulty in identifying suitable acquisition candidates and completing transactions at appropriate valuations, in a timely manner, on a cost-effective basis or at all, due to substantial competition for acquisition targets; • inability to successfully integrate any acquired businesses into our business operations; • failure to realize the anticipated synergies or other benefits of any such transaction; • entry into markets in which we have limited or no prior experience; • finding acquirors and obtaining adequate value for businesses that no longer meet our strategic objectives; • difficulties surrounding the disentanglement of a divested business, including the diversion of resources away from our business operations to address such matters; • inability to complete proposed or pending transactions due to factors such as the failure or inability to obtain regulatory or other approvals, which may be exacerbated by the recent, more aggressive regulatory approaches to merger control globally, such as the July 19, 2023 joint statement of antitrust policy and final rules published on October 10, 2024 concerning changes to the premerger notification process under the Hart-Scott-Rodino Act of 1976 by the Department of Justice and Federal Trade Commission and the April 15, 2023 Provisions on the Review of Concentrations of Undertakings issued by China’s State Administration for Market Regulation, among others; 28 Table of Contents • requirements imposed by government regulators in connection with their review of a transaction, which may include, among other things, divestitures and restrictions on the conduct of our existing business or the acquired business; • undertaking multiple transactions at the same time in order to take advantage of acquisition or divestiture opportunities that do arise, which could strain our ability to effectively execute and integrate such transactions; • diversion of management’s attention from our day-to-day business due to dedication of significant management resources to such transactions; • employee uncertainty and lack of focus during the integration process that may also disrupt our business; • risk of litigation or claims associated with a proposed or completed transaction; • challenges associated with managing new, more diverse and more widespread operations, projects and people, potentially located in regions where we have not historically conducted or operated our business; • dependence on unfamiliar or less secure supply chains and inefficient scale of the acquired entity; • increasing costs of performing due diligence to meet the expectations of investors and government regulators; • despite our due diligence, we could assume unknown, underestimated or contingent liabilities, such as potential environmental, health and safety liabilities, any of which could lead to costly litigation or mitigation actions; • an acquired technology or product may have inadequate or invalid intellectual property protection or may be subject to claims of infringement by a third party, which may result in claims for damages and lower than anticipated revenue; • negative effects on our reported results of operations from dilutive results from operations and/or from future potential impairment of acquired assets, including goodwill, related to acquisitions; • an acquired company may have inadequate or ineffective internal controls over financial reporting, disclosure controls and procedures, cybersecurity, privacy, environmental, health and safety, anti-bribery, anti-corruption, human resource or other policies or practices, which may require unexpected or additional integration, mitigation and remediation costs; • reductions in cash or increases in debt to finance transactions, which reduce the cash flow available for general corporate or other purposes, including repayment of existing debt, share repurchases and dividends; and • difficulties in retaining key employees or customers of an acquired business.
These transactions involve numerous risks to our business, financial condition and operating results, including but not limited to: • difficulty in identifying suitable acquisition candidates and completing transactions at appropriate valuations, in a timely manner, on a cost-effective basis or at all, due to substantial competition for acquisition targets; • inability to successfully integrate any acquired businesses into our business operations; • failure to realize the anticipated synergies or other benefits of any such transaction; • entry into markets in which we have limited or no prior experience; • finding acquirors and obtaining adequate value for businesses that no longer meet our strategic objectives; • difficulties surrounding the disentanglement of a divested business, including the diversion of resources away from our business operations to address such matters; • inability to complete proposed or pending transactions due to factors such as the failure or inability to obtain regulatory or other approvals, which may be exacerbated by the recent, more aggressive regulatory approaches to merger control globally, such as the July 19, 2023 joint statement of antitrust policy and final rules published on October 10, 2024 concerning changes to the premerger notification process under the Hart-Scott-Rodino Act of 1976 by the Department of Justice and Federal Trade Commission and the April 15, 2023 Provisions on the Review of Concentrations of Undertakings issued by China’s State Administration for Market Regulation, among others; • requirements imposed by government regulators in connection with their review of a transaction, which may include, among other things, divestitures and restrictions on the conduct of our existing business or the acquired business; • undertaking multiple transactions at the same time in order to take advantage of acquisition or divestiture opportunities that do arise, which could strain our ability to effectively execute and integrate such transactions; • diversion of management’s attention from our day-to-day business due to dedication of significant management resources to such transactions; • employee uncertainty and lack of focus during the integration process that may also disrupt our business; • risk of litigation or claims associated with a proposed or completed transaction; • challenges associated with managing new, more diverse and more widespread operations, projects and people, potentially located in regions where we have not historically conducted or operated our business; • dependence on unfamiliar or less secure supply chains and inefficient scale of the acquired entity; • increasing costs of performing due diligence to meet the expectations of investors and government regulators; • despite our due diligence, we could assume unknown, underestimated or contingent liabilities, such as potential environmental, health and safety liabilities, any of which could lead to costly litigation or mitigation actions; • an acquired technology or product may have inadequate or invalid intellectual property protection or may be subject to claims of infringement by a third party, which may result in claims for damages and lower than anticipated revenue; • negative effects on our reported results of operations from dilutive results from operations and/or from future potential impairment of acquired assets, including goodwill, related to acquisitions; • an acquired company may have inadequate or ineffective internal controls over financial reporting, disclosure controls and procedures, cybersecurity, privacy, environmental, health and safety, anti-bribery, anti-corruption, human resource 27 Table of Contents or other policies or practices, which may require unexpected or additional integration, mitigation and remediation costs; • reductions in cash or increases in debt to finance transactions, which reduce the cash flow available for general corporate or other purposes, including repayment of existing debt, share repurchases and dividends; and • difficulties in retaining key employees or customers of an acquired business.
This can adversely affect our business with China, Japan, Korea, and/or Taiwan and potentially the entire Asia Pacific region or global economy. A significant trade dispute, impact and/or disruption in any area where we do business could have a materially adverse impact on our future revenue and profits.
This can adversely affect our business with China, Japan, Korea, and/or Taiwan and potentially the entire Asia Pacific region or global economy. A significant dispute, impact and/or disruption in any area where we do business could have a materially adverse impact on our future revenue and profits.
Furthermore, there is inherent risk, based on the complex relationships among China, Japan, Korea, Taiwan, and the U.S., that political, diplomatic and national security influences could lead to trade disputes, impacts and/or disruptions, in particular those affecting the semiconductor industry.
Furthermore, there is inherent risk, based on the complex relationships among China, Japan, Korea, Taiwan, and the U.S., that political, diplomatic and national security influences could lead to disputes, impacts and/or disruptions, in particular those affecting the semiconductor industry.
The trading price of our common stock is subject to significant volatility in response to numerous factors, many of which are beyond our control or may be unrelated to our operating results, including the following: • changes to our financial guidance, as well as potential decreased confidence in any guidance we do provide; • changes in global economic and geopolitical conditions, including those resulting from trade tensions, rising inflation, and fluctuations in foreign currency exchange and interest rates; • failure to meet the expectations of securities analysts, which may vary significantly from our actual results; • changes in financial estimates by securities analysts; • press releases or announcements by, or changes in market values of, comparable companies; • high volatility in price and volume in the markets for high-technology stocks; • public perception of equity values of publicly traded companies; • fluctuations in our results of operations; and • other risks and uncertainties described in this Annual Report on Form 10-K and in our other filings with the SEC.
The trading price of our common stock is subject to significant volatility in response to numerous factors, many of which are beyond our control or may be unrelated to our operating results, including the following: • changes to our financial guidance, as well as potential decreased confidence in any guidance we do provide; 25 Table of Contents • changes in global economic and geopolitical conditions, including those resulting from trade tensions, rising inflation, and fluctuations in foreign currency exchange and interest rates; • failure to meet the expectations of securities analysts, which may vary significantly from our actual results; • changes in financial estimates by securities analysts; • press releases or announcements by, or changes in market values of, comparable companies; • high volatility in price and volume in the markets for high-technology stocks; • public perception of equity values of publicly traded companies; • fluctuations in our results of operations; and • other risks and uncertainties described in this Annual Report on Form 10-K and in our other filings with the SEC.
In the future, such litigation could (1) impose substantial costs and cause the diversion of resources and the attention of management; (2) require us to pay damages or royalties; (3) require us to alter our products or processes, or obtain a license to continue selling the impacted product, which we may be unable to do on commercially acceptable terms, or at all; (4) severely harm our reputation and competitive position; and (5) negatively affect our sales, profitability and prospects.
In the future, such litigation could (1) impose substantial costs and cause the diversion of resources and the attention of management; (2) require us to pay damages or royalties; (3) require us to alter our products or processes, or obtain a license to continue selling the impacted product, which we may be unable to do on commercially acceptable terms, or at all; (4) severely harm our reputation and competitive position; and (5) negatively affect our sales, profitability and prospects to commercialize new products.
Compliance with these requirements may add complexity to our operations and increase our costs, and a failure to comply could result in cancelation of agreements or transactions, investigations, civil and criminal penalties, forfeiture of profits, reduction, termination or clawback of any funding, suspension or debarment from doing business with the government, or other penalties, any of which could have a material and adverse effect on our business, financial condition and results of operations.
Compliance with these requirements may add complexity to our operations and increase our costs, and a failure to comply could result in cancellation of agreements or transactions, investigations, civil and criminal penalties, forfeiture of profits, reduction, termination or clawback of any funding, suspension or debarment from doing business with the government, or other penalties, any of which could have a material and adverse effect on our business, financial condition and results of operations.
As a public company with global operations, we are subject to the laws of multiple jurisdictions and the rules and regulations of various governing bodies, including those related to health and safety, import and export controls, financial and other disclosures, accounting standards, corporate governance, public procurement and public funding, environment (including those relating to sustainability and climate change), privacy, anti-corruption, such as the Foreign Corrupt Practices Act and other local laws prohibiting corrupt payments to governmental officials or customers, conflict minerals or other social responsibility legislation, employment practices, immigration or travel regulations and antitrust regulations, among others.
As a public company with global operations, we are subject to the laws of multiple jurisdictions and the rules and regulations of various governing bodies, including those related to health and safety, import and export controls, financial and other disclosures, accounting standards, corporate governance, public procurement and public funding, environment (including those relating to sustainability, carbon emissions and climate change concerns), privacy, anti-corruption, such as the Foreign Corrupt Practices Act and other local laws prohibiting corrupt payments to governmental officials or customers, conflict minerals or other social responsibility legislation, employment practices, immigration or travel regulations and antitrust regulations, among others.
A reduction, suspension or discontinuation of our dividend payments or the cessation of our share repurchase program could have a negative effect on the price of our common stock and may harm our reputation. Provisions in our charter documents and Delaware law may delay or prevent an acquisition of us, which could decrease the value of our shares.
A reduction, suspension or discontinuation of our dividend payments or the lack of a share repurchase program could have a negative effect on the price of our common stock and may harm our reputation. Provisions in our charter documents and Delaware law may delay or prevent an acquisition of us, which could decrease the value of our shares.
For example, we rely on single, sole or limited source suppliers for certain raw materials that are critical to the manufacturing of our products, such as plastic polymers, filtration membranes, abrasive particles, petroleum coke and other materials.
For example, we rely on single, sole or limited source suppliers for certain raw materials that are critical to manufacturing our products, such as plastic polymers, filtration membranes, abrasive particles, petroleum coke and other materials.
If our cash flow and capital resources are insufficient to fund our debt service obligations, we could face substantial liquidity problems, be forced to reduce or delay investments and capital expenditures, dispose of material assets or operations, seek additional debt or equity capital or restructure or refinance our indebtedness, any of which could have a material adverse effect on our business, financial position and results of operations.
If our cash flow and capital resources are insufficient to fund our debt service obligations, we could 24 Table of Contents face substantial liquidity problems, be forced to reduce or delay investments and capital expenditures, dispose of material assets or operations, seek additional debt or equity capital or restructure or refinance our indebtedness, any of which could have a material adverse effect on our business, financial position and results of operations.
As of December 31, 2024, we had an aggregate principal amount of $4.0 billion of indebtedness outstanding, including the $0.8 billion from our senior secured term loan facility due 2029 (the “Term Loan Facility”), $1.6 billion aggregate principal amount of the 4.75% senior secured notes due April 15, 2029, $1.7 billion aggregate principal amount of the 5.95% senior unsecured notes due June 15, 2030, our 4.375% senior unsecured notes due April 15, 2028, and our 3.625% senior unsecured notes due May 1, 2029 (collectively, the “Notes”).
As of December 31, 2025, we had an aggregate principal amount of $3.7 billion of indebtedness outstanding, including the $0.5 billion from our senior secured term loan facility due 2029 (the “Term Loan Facility”), $1.6 billion aggregate principal amount of the 4.75% senior secured notes due April 15, 2029, $1.7 billion aggregate principal amount of the 5.95% senior unsecured notes due June 15, 2030, our 4.375% senior unsecured notes due April 15, 2028, and our 3.625% senior unsecured notes due May 1, 2029 (collectively, the “Notes”).
These restrictions may prohibit the sale of certain of our products, services and technologies, and they may require us to obtain a license from the U.S. government before delivering the controlled item or service.
These restrictions may prohibit the sale of certain of our products, services and technologies, and they may require us to obtain a license from the U.S. government and/or other governments before delivering the controlled item or service.
We have recorded goodwill impairment charges in the past, and such charges have materially affected our historical results of operations. For additional information, see Note 9 – Goodwill and Intangible Assets to the accompanying consolidated financial statements.
We have recorded goodwill impairment charges in the past, and such charges have materially affected our historical results of operations. For additional information see Note 8 – Goodwill and Intangible Assets to the accompanying consolidated financial statements.
In addition, some of our competitors may have better-established customer relationships than we do, which may enable them to have their products specified for use more frequently and more quickly by these customers. We also face competition from smaller, regional companies that focus on serving customers in their regions.
In addition, some of our competitors may have better-established customer relationships than we do, which may enable them to have their products specified for use more frequently and more quickly by these customers. We also face competition from smaller, 26 Table of Contents regional companies that focus on serving customers in their regions.
Artificial intelligence capabilities are and will be used by threat actors to identify vulnerabilities and craft increasingly sophisticated cybersecurity attacks, making them even more difficult to defend against by creating more effective phishing emails or social engineering and by exploiting vulnerabilities in electronic security programs utilizing false image or voice recognition.
AI capabilities are and will be used by threat actors to identify vulnerabilities and craft increasingly sophisticated cybersecurity attacks, making them even more difficult to defend against by creating more effective phishing emails or social engineering and by exploiting vulnerabilities in electronic security programs utilizing false image or voice recognition.
We operate in the semiconductor industry, which is subject to rapid technological change, changing customer requirements and frequent new product introductions. In our industry, the first company to introduce an innovative product that addresses an identified market need will often have a significant advantage over competing products.
The semiconductor industry is subject to rapid technological change, changing customer requirements and frequent new product introductions. In our industry, the first company to introduce an innovative product that addresses an identified market need will often have a significant advantage over competing products.
Our certificate of incorporation authorizes our Board of Directors to issue, without further stockholder approval, up to 5,000,000 shares of preferred stock in one or more series and to fix and designate the rights, preferences, privileges and 27 Table of Contents restrictions of the preferred stock, including dividend rights, conversion rights, voting rights, redemption rights and liquidation preferences.
Our certificate of incorporation authorizes our Board of Directors to issue, without further stockholder approval, up to 5,000,000 shares of preferred stock in one or more series and to fix and designate the rights, preferences, privileges and restrictions of the preferred stock, including dividend rights, conversion rights, voting rights, redemption rights and liquidation preferences.
Our failure to comply with these covenants could result in the acceleration of some or all of our indebtedness, which could lead to bankruptcy, reorganization or insolvency. 26 Table of Contents Risks Related to Owning our Common Stock The price of our common stock has been and may remain volatile. The price of our common stock has been volatile.
Our failure to comply with these covenants could result in the acceleration of some or all of our indebtedness, which could lead to bankruptcy, reorganization or insolvency. Risks Related to Owning our Common Stock The price of our common stock has been and may remain volatile. The price of our common stock has been volatile.
The amounts of our dividend payments may change from time to time, and we may decide at any time to reduce, suspend or discontinue the payment of dividends or the repurchase of shares.
The amounts of our dividend payments may change from time to time, and we may decide at any time to reduce, suspend or discontinue the payment of dividends.
Changes in, and responses to, U.S. trade controls could reduce the competitiveness of our products and cause our sales to decline, which could have a material adverse effect on our business, financial condition and results of operations.
Changes in, or responses to, U.S. or other countries’ trade controls could reduce the competitiveness of our products and cause our sales to decline, which could have a material adverse effect on our business, financial condition and results of operations.
As a result, export regulations or other trends that apply to customers in certain countries, such as those in China, have exposed and may further expose our business and results of operations to greater volatility.
As a result, export regulations, the imposition of tariffs or other trends that apply to customers in certain countries, such as those in China, have exposed and may further expose our business and results of operations to greater volatility.
The loss of our key employees or an inability to attract, hire, train, motivate and retain qualified and skilled employees, particularly research and development and engineering personnel, could cause business interruptions and inhibit our ability to operate and 22 Table of Contents grow our business.
The loss of our key employees or an inability to attract, hire, train, motivate and retain qualified and skilled employees, particularly research and development and engineering personnel, could cause business interruptions and inhibit our ability to operate and grow our business.
For example, while we believe that our SDS and VAC delivery systems are safe to transport, store and deliver toxic gases, any leakage could cause serious damage, including injury or death, to any person exposed to those toxic gases, potentially creating significant product liability exposure for us.
For example, while we believe that our SDS and VAC delivery systems are safe to transport, store and deliver toxic gases, any leakage could cause serious damage, including injury or death, to any person exposed to those toxic gases, 20 Table of Contents potentially creating significant product liability exposure for us.
Furthermore, these restrictive measures have incentivized Chinese domestic semiconductor companies to work more closely with local Chinese companies and companies headquartered outside of the United States in an effort to enable these companies to enhance the technology-level and quality of their products and, as a result, to better compete with our products.
Furthermore, these restrictive measures have incentivized Chinese domestic semiconductor companies to work more closely with local Chinese companies and companies headquartered outside of the U.S. in an effort to enable these companies to enhance the technology-level and quality of their products and, as a result, to better compete with our products.
From time to time, we may receive and enter agreements for grants, tax benefits and other incentives from national, state and local governments in jurisdictions throughout the world designed to encourage us to establish, maintain or increase our investment, research and development and production activities in those jurisdictions.
From time to time, we may receive and enter agreements for grants, subsidies, loans, tax arrangements and other incentives from national, state and local governments in jurisdictions throughout the world designed to encourage us to establish, maintain or increase our investment, research and development and production activities in those jurisdictions.
For example, the OECD introduced the Base Erosion and Profit Shifting 2.0 project that seeks to impose a global minimum income tax rate of 15%. Any tax reform adopted in any foreign jurisdiction may exacerbate the risks described above.
For example, the OECD introduced the Base Erosion and Profit Shifting 2.0 project that seeks to impose a global minimum income tax rate of 15%. Any tax reform adopted in any foreign jurisdiction may exacerbate the risks described above and cause our corporate tax rate to increase.
Risks Related to Government Regulation 23 Table of Contents We are subject to a variety of rapidly evolving environmental laws and regulations that could cause us to incur significant liabilities and expenses.
Risks Related to Government Regulation We are subject to a variety of rapidly evolving environmental laws and regulations that could cause us to incur significant liabilities and expenses.
The use of artificial intelligence by us, our customers, suppliers and other business partners and third-party providers may introduce vulnerabilities onto our IT systems.
The use of AI by us, our customers, suppliers and other business partners and third-party providers may introduce vulnerabilities onto our IT systems.
Over the last several years, the U.S. government has significantly expanded export controls on certain technologies and commodities to certain markets, particularly with respect to semiconductor and other high technology exports to China, a market which represented approximately 21% of our sales in 2024.
Over the last several years, the U.S. and other governments have significantly expanded export controls on certain technologies and commodities to certain markets, particularly with respect to semiconductor and other high technology exports to China, a market which represented approximately 21% of our sales in 2025.
These or any future reorganizations could result in adverse tax consequences in one or more jurisdictions, which could adversely impact our profitability from foreign operations and result in a material reduction in our results of operations. 24 Table of Contents Various jurisdictions in which we operate are considering changes to their tax laws.
These or any future reorganizations could result in adverse tax consequences in one or more jurisdictions, which could adversely impact our profitability from foreign operations and result in a material reduction in our results of operations. Various jurisdictions in which we operate are considering changes to, or have already changed, their tax laws.
In the past, intellectual property-related litigation has caused us to expend significant financial and other resources.
In the past, intellectual property-related litigation has been time consuming and has caused us to expend significant financial and other resources.
The semiconductor industry has historically been, and is likely to continue to be, cyclical with periodic downturns, resulting in decreased demand for our products, which has negatively impacted our results of operations in the past and could do so again in the future.
Our revenue is primarily dependent upon demand from the global semiconductor ecosystem. The semiconductor industry has historically been, and is likely to continue to be, cyclical with periodic downturns, resulting in decreased demand for our products, which has negatively impacted our results of operations in the past and could do so again in the future.
Our continuity plans may be insufficient to mitigate the impact of disruptions to our operations, and any prolonged disruption may impede our ability to manufacture and deliver products to our customers, resulting in an adverse impact on our business and results of operations.
Our continuity plans may be insufficient to mitigate the impact of disruptions to our operations, and any prolonged disruption may impede our ability to manufacture and deliver products to our customers or to engage with customers on new product applications, resulting in an adverse impact on our business and results of operations.
Even if we successfully move our manufacturing processes, we may not achieve the anticipated levels of cost savings or efficiencies, if any. These and other manufacturing difficulties may result in the loss of sales and exposure to warranty and product liability claims.
Even if we successfully move our manufacturing processes, we may not achieve the anticipated levels of cost savings or efficiencies, if any, and such disruptions may cause delays in developing or shipping our products. These and other manufacturing difficulties may result in the loss of sales and exposure to warranty and product liability claims.
Risk Factor Summary Risks Related to Our Business and Industry • Fluctuations in demand for semiconductors and volume of semiconductor manufacturing. • Global economic uncertainty, including volatile financial markets, inflation, fluctuations in interest rates, economic recessions, and national debt and bank failures. • Variability of revenues and operating results. • Supply chain risks, including partial reliance on sole, single or limited source suppliers. • Challenges inherent in operating a global business, including managing complex political, legal, regulatory, and operational environments across the jurisdictions in which the Company operates. • Regional and global instabilities and hostilities, including the ongoing conflicts between Ukraine and Russia, and between Israel and Hamas. • The impact of export controls, economic sanctions and other similar restrictions. • Customer concentration. • Continuing innovation and introduction of new products. • Risks related to competition. • Manufacturing interruptions or delays and other operational disruptions. • Information technology (“IT”) system failures, network disruptions, data breaches, and other cybersecurity threats. • The use of hazardous materials in our operations. • The impact of tariffs, additional taxes, and other protectionist measures. • Goodwill impairment. • Loss of key employees. • Our ability to obtain, protect, and enforce intellectual property rights. • Environmental, social, and governance commitments.
Risk Factor Summary Risks Related to Our Business and Industry • Fluctuations in demand for semiconductors and volume of semiconductor manufacturing. • Global economic uncertainty, including volatile financial markets, inflation, fluctuations in interest rates, economic recessions, and national debt and bank failures. • Supply chain risks, including partial reliance on sole, single or limited source suppliers. • Challenges inherent in operating a global business, including managing complex political, legal, regulatory, and operational environments across the jurisdictions in which the Company operates. • The impact of export controls, economic sanctions and other similar restrictions. • Customer concentration. • The need for continuing innovation and introduction of new products. • Manufacturing interruptions or delays and other operational disruptions. • Information technology (“IT”) system failures, network disruptions, data breaches, and other cybersecurity threats. • The impact of tariffs and a volatile trade environment. • The use of hazardous materials in our operations. • Goodwill impairment. • Loss of key employees. • Our ability to obtain, protect, and enforce intellectual property rights. • Our use, and our competitors’ use, of AI • Environmental, social, and governance commitments.
If our suppliers or sub-suppliers are unable to maintain their operations, due to operational restrictions or financial hardship caused by an economic slowdown or recession, we may increase our safety stocks of raw materials or components or alter our payment terms with such suppliers, including prepaying for raw materials, which could put downward pressure on our cash flow.
If our suppliers or sub-suppliers are unable to maintain their operations due to operational restrictions or financial hardship caused by an economic slowdown or recession, we may need to increase our safety stocks of raw materials or components or alter our payment terms with such suppliers, including prepaying for raw materials.
Our debt could have important consequences, including: • limiting our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate purposes; • requiring a substantial portion of our cash flow to be dedicated to debt service payments instead of other purposes; • increasing our vulnerability to adverse changes in general economic, industry and competitive conditions; • exposing us to increased interest expense for borrowings with variable interest rates, including borrowings under the Credit Facilities; and • placing us at a disadvantage compared to other, less leveraged competitors or competitors with comparable debt having more favorable terms. 25 Table of Contents We may be unable to generate sufficient cash to service our indebtedness and may be forced to take other actions, which may not be successful, to satisfy our obligations under our indebtedness.
Our debt could have important consequences, including: • limiting our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate purposes; • requiring a substantial portion of our cash flow to be dedicated to debt service payments instead of other purposes; • increasing our vulnerability to adverse changes in general economic, industry and competitive conditions; • exposing us to increased interest expense for borrowings with variable interest rates, including borrowings under the Credit Facilities; and • placing us at a disadvantage compared to other, less leveraged competitors or competitors with comparable debt having more favorable terms.
We intend to continue to maintain extensive sales, product development and manufacturing operations internationally, which are subject to a number of risks, uncertainties and potential costs that could adversely affect our revenue, profitability and reputation, including: • changes and uncertainties with respect to trade and export regulations (including new and changing regulations for exports of certain technologies to China), trade policies and sanctions, tariffs, international trade disputes and any retaliatory measures, which impact countries in which we conduct significant business, which could (1) impose 18 Table of Contents additional costs on our operations, (2) limit our ability to operate our business and (3) adversely impact us, our customers or our suppliers; • positions taken by governments or governmental agencies regarding national, commercial and/or security issues posed by the development, sale or export of certain raw materials, products and technologies; • geopolitical tensions or conflicts, such as Russia’s invasion of Ukraine, the ongoing conflict in the Middle East and increasing tensions between China and Taiwan and between China and the U.S., and other political and economic instability and uncertainty; • cybersecurity incidents; • challenges in hiring and integrating workers in different countries; • challenges in managing a diverse workforce with different experience levels, languages, cultures, customs, business practices and worker expectations, along with differing employment practices and labor issues; • challenges of maintaining appropriate business processes, procedures and internal controls and complying with legal, environmental, health and safety, anti-bribery, anti-corruption, trade compliance, data privacy, cybersecurity and other regulatory requirements that vary by jurisdiction; • challenges in developing relationships with local customers, suppliers and governments; • fluctuating pricing and availability of raw materials and supply chain interruptions or slowdowns, including as a result of difficulties, financial or otherwise, faced by segments of the transportation industry; • public health crises; • expense and complexity of complying with U.S. and foreign import and export regulations, including the ability to obtain and renew required import and export licenses; • fluctuations in interest rates and currency exchange rates, including the relative strength or weakness of the U.S. dollar against foreign currencies that are important to our business; • liability for foreign taxes assessed at rates higher than those applicable to our domestic operations; • imposition of a global minimum tax rate, including by the Organization of Economic Co-operation and Development (“OECD”); • challenges and costs associated with the protection of our intellectual property throughout the world; • challenges associated with managing global and regional third-party service providers, including certain engineering, software development, manufacturing, IT and other functions; • customer or government efforts to encourage operations and sourcing in a particular country, such as Korea or China, including efforts to develop and grow local competitors, require local manufacturing, and provide special incentives to government-backed local customers to buy from local competitors; and • impacts of natural disasters and extreme and chronic weather events on our operations and those of our customers and suppliers, which may be exacerbated by climate change.
We intend to continue to maintain extensive sales, product development and manufacturing operations internationally, which are subject to a number of risks, uncertainties and potential costs that could adversely affect our revenue, profitability and reputation, including: • changes and uncertainties with respect to trade and export regulations (including new and changing regulations for exports of certain technologies to China), trade policies and sanctions, tariffs, international trade disputes and any retaliatory measures; • geopolitical tensions or conflicts, such as Russia’s invasion of Ukraine, the ongoing conflict in the Middle East, and tensions between China and Taiwan and between China and the U.S.; • cybersecurity incidents; • challenges in hiring and integrating workers in different countries and in managing a diverse workforce with different experience levels, languages, cultures, customs, business practices and worker expectations, along with differing employment practices and labor issues; • challenges of maintaining appropriate business processes, procedures and internal controls and complying with legal, environmental, health and safety, anti-bribery, anti-corruption, trade compliance, data privacy, cybersecurity and other regulatory requirements that vary by jurisdiction; • challenges in developing relationships with local customers, suppliers and governments; • public health crises; • fluctuations in interest rates and currency exchange rates, including the relative strength or weakness of the U.S. dollar against foreign currencies that are important to our business; • liability for foreign taxes assessed at rates higher than those applicable to our domestic operations; 16 Table of Contents • imposition of a global minimum tax rate, including by the Organization of Economic Co-operation and Development (“OECD”); • challenges and costs associated with the protection of our intellectual property throughout the world; • challenges associated with managing global and regional third-party service providers, including certain engineering, software development, manufacturing, IT and other functions; • customer or government efforts to encourage operations and sourcing in a particular country, such as Korea or China, including efforts to develop and grow local competitors, require local manufacturing, and provide special incentives to government-backed local customers to buy from local competitors; and • impacts of natural disasters and extreme and chronic weather events on our operations and those of our customers and suppliers, which may be exacerbated by climate change.
These uncertain and volatile economic conditions can cause material adverse changes in our results of operations and financial condition, including: • a decline in demand for our products, which would have an immediate and potentially long-lasting negative impact on our revenues; • an increase in reserves for accounts receivable due to our customers’ inability to pay us; 16 Table of Contents • lower utilization of our manufacturing facilities, which could lead to lower margins; • an increase in write-offs for excess or obsolete inventory that we cannot sell; • potential impairment charges relating to goodwill, intangible assets, manufacturing equipment or other long-lived assets, to the extent that any downturn indicates that the carrying amount of the asset may not be recoverable; • limiting our suppliers’ ability to deliver parts and raw materials, which would negatively affect our ability to manage operations, manage our costs and sell our products; • consolidation or strategic alliances among other suppliers to semiconductor manufacturers, which could adversely affect our ability to compete effectively; • greater challenges in forecasting operating results, making business decisions and identifying and prioritizing business risks; • additional cost reduction efforts, including additional restructuring activities, which may adversely affect our ability to capitalize on opportunities; and • limitations on our ability to access cash maintained in our bank accounts as a result of bank failures, which could affect our ability to manage our operations.
We may also face a number of other negative effects related to global economic uncertainty, including. • an increase in reserves for accounts receivable due to our customers’ inability to pay us; • lower utilization of our manufacturing facilities, which could lead to lower margins; • an increase in write-offs for excess or obsolete inventory that we cannot sell; • potential impairment charges relating to goodwill, intangible assets, manufacturing equipment or other long-lived assets, to the extent that any downturn indicates that the carrying amount of the asset may not be recoverable; • an inability of suppliers to deliver parts and raw materials, which would negatively affect our ability to manage operations, manage our costs and sell our products; • consolidation or strategic alliances among other suppliers to semiconductor manufacturers, which could adversely affect our ability to compete effectively; • greater challenges in forecasting operating results, making business decisions and identifying and prioritizing business risks; • a need to undertake additional cost reduction efforts, including additional restructuring activities, which may adversely affect our ability to capitalize on opportunities; and • limitations on our ability to access cash maintained in our bank accounts as a result of bank failures, which could affect our ability to manage our operations.
A failure to successfully anticipate and respond to technological changes by developing, marketing and manufacturing new products or enhancements to our existing products could harm our business prospects, limit our market share, result in unanticipated costs and significantly reduce our sales. The new products and technology we choose to develop and market may also not be successful.
A failure to successfully anticipate and respond to technological changes by developing, marketing and manufacturing new products or enhancements to our existing products could harm our business prospects, limit our market share, result in unanticipated costs and significantly reduce our sales.
The semiconductor industry is also affected by seasonal shifts in demand, and as a result, we have in the past and may experience in the future short-term fluctuation in our results of operations from one period to the next. We are unable to predict the timing, duration or severity of any current or future downturns in the semiconductor industry.
The semiconductor industry is also affected by seasonal shifts in demand, and as a result, we have in the past experienced and may experience in the future short-term fluctuation in our results of operations from one period to the next.
In 2024, the closing price of our stock on The Nasdaq Global Select Market (“Nasdaq”) ranged from a low of $97.67 to a high of $146.48, and, as in past years, the price of our common stock may show even greater volatility in the future.
In 2025, the closing price of our stock on The Nasdaq Global Select Market (“Nasdaq”) ranged from a low of $62.92 to a high of $109.53, and, as in past years, the price of our common stock may show even greater volatility in the future.
If we were to lose any of our significant customers, if our products are not specified for our significant customers’ products or if we suffer a material reduction in their purchase orders, our revenue could decline and our business, financial condition and results of operations could be materially and adversely affected.
If we were to lose any of our significant customers, if our products are not specified for our significant customers’ products, if our customers lose market share to competitors with whom we do not have as strong relationships or as favorable commercial terms, or if we suffer a material reduction in their purchase orders, our revenue could decline and our business, financial condition and results of operations could be materially and adversely affected.
Furthermore, government authorities may take retaliatory actions, impose conditions that require the use of local suppliers or partnerships with local companies, increase tariff and other customs costs or require the license or other transfer of intellectual property, which could have a significant adverse impact on our business.
Furthermore, government authorities may take retaliatory actions, impose conditions that require the use of local suppliers or partnerships with local companies, increase tariff and other customs costs, impose export restrictions on raw materials and components, such as the restrictions imposed on critical materials and minerals by China in 2025, or require the license or other transfer of intellectual property, which could have a significant adverse impact on our business.
Our future business plans are impacted by obtaining these government incentives, which may take various forms, including grants, subsidies, loans, and tax arrangements, and typically require us to achieve or maintain certain levels of investment, capital spending, employment, technology deployment or development milestones, construction or production milestones, or research and development activities to qualify for such incentives or could restrict us from undertaking certain activities.
Our future business plans are impacted by obtaining these government incentives, and they typically require us to achieve or maintain certain levels of investment, capital spending, employment, technology deployment or development milestones, construction or production milestones, or research and development activities to qualify for such incentives or could restrict us from undertaking certain 23 Table of Contents activities.
We have moved, and we may in the future move, the manufacture of certain products from one plant to another. If we fail to transfer and re-establish the manufacturing processes in the destination plant efficiently and effectively, we may not be able to meet customer demand, we may lose credibility with our customers and our business may be harmed.
If we fail to transfer and re-establish the manufacturing processes in the destination plant efficiently and effectively, we may not be able to meet customer demand, we may lose credibility with our customers and our business may be harmed.
In addition, we may be unable to maintain the current creditworthiness or prospective credit rating of the Company. Any actual or anticipated changes or downgrades in such credit rating may have a negative impact on our liquidity, capital position or access to capital markets and affect our ability to obtain any future required financing on acceptable terms or at all.
Any actual or anticipated changes or downgrades in such credit rating or disruptions in the global financial markets may have a negative impact on our liquidity, capital position or access to capital markets and affect our ability to obtain any future required financing on acceptable terms or at all.
If we were to lose any one of these or other critical sources, or there is as an industry-wide increase in demand for, or the discontinuation of, raw materials or other components used in our products, it could be difficult for us, or we may be unable, to find an alternative supplier to provide certain raw materials and components, in which case our operations could be adversely affected.
If we were to lose any of these critical sources, or there is an industry-wide increase in demand for, or discontinuation of, raw materials or components used in our products, it could be difficult or impossible to find an alternative supplier, which could adversely affect our operations.
A lower volume of sales can have a large and disproportionate impact on our profitability. For example, to remain competitive in the semiconductor industry, we have in the past, and will likely in the future, maintain or increase our ER&D activity and invest in our infrastructure, even during downturns and periods of slower demand.
To remain competitive in the semiconductor industry, we have in the past, and will likely in the future, maintain or increase our ER&D activity and invest in our infrastructure, even during downturns and periods of slower demand.
Our operations involve, and we are exposed to the risks associated with, the use and manufacture of hazardous materials. In particular, we manufacture specialty chemicals, which is an inherently hazardous process that may result in accidents, and store and transport hazardous raw materials, products and waste in, to and from various facilities.
In particular, we manufacture specialty chemicals, which is an inherently hazardous process that may result in accidents, and store and transport hazardous raw materials, products and waste in, to and from various facilities.
We may be unable to maintain sufficient cash flow from operating activities to permit us to pay the principal of, premium, if any, and interest on our indebtedness.
We may be unable to generate sufficient cash to service our indebtedness and may be forced to take other actions, which may not be successful, to satisfy our obligations under our indebtedness. We may be unable to maintain sufficient cash flow from operating activities to permit us to pay the principal of, premium, if any, and interest on our indebtedness.
Surge in demand for semiconductors and other factors outside of our control have resulted in, and may in the future result in, a shortage of raw materials and components needed to manufacture and deliver our products, higher raw materials costs, costly and time-consuming re-qualification of products manufactured with new raw materials and delays in, and unpredictability of, shipments due to transportation interruptions.
Several factors outside of our control, including, but not limited to, surges in demand for semiconductors, changes in trade policies, the imposition of foreign export controls on critical materials and minerals and international conflicts, have resulted in, and may in the future result in, a shortage of raw materials and components needed to manufacture and deliver our products, higher raw materials costs, costly and time-consuming re-qualification of products manufactured with new raw materials and delays in, and unpredictability of, shipments due to transportation interruptions.
Furthermore, our limited visibility of future customer orders makes it difficult for us to predict industry trends. During downturns in the semiconductor industry, which can occur suddenly, we typically experience greater pricing pressure and shifts in product and customer mix, which can adversely affect our gross margin and net income.
During downturns in the semiconductor industry, which can occur suddenly, we typically experience greater pricing pressure and shifts in product and customer mix, which can adversely affect our gross margin and net income.
We anticipate that international sales will continue to account for a majority of our net sales. In addition, a number of our key domestic customers derive a significant portion of their revenues from sales in international markets.
Sales to customers outside the U.S. accounted for approximately 82%, 79% and 75% of our net sales in 2025, 2024 and 2023, respectively. We anticipate that international sales will continue to account for a majority of our net sales. In addition, a number of our key domestic customers derive a significant portion of their revenues from sales in international markets.
Obtaining export licenses may be difficult, costly and time-consuming, and we may fail to receive licenses that we apply for on a timely basis or at all. We must also comply with export control and economic sanctions laws and regulations imposed by other countries.
Obtaining export licenses may be difficult, costly and time-consuming, and we may fail to receive licenses that we apply for on a timely basis or at all.
We continue to devote significant resources to network security, threat monitoring and other measures to protect our systems and data from unauthorized access or misuse, and we may be required to expend greater resources in the future, especially in the face of evolving and increasingly sophisticated cybersecurity threats and laws, regulations, contractual and other actual and asserted obligations to which we are or may become subject relating to privacy, data protection, and cybersecurity. 21 Table of Contents IT system failures, network disruptions and breaches of data security could (1) cause disruption in our operations, issues with customer communication and order management, the unauthorized or unintentional disclosure of sensitive information, or disruptions in our transaction processing or (2) undermine the integrity of our disclosure controls and procedures and our internal control over financial reporting, which could affect our reputation, result in significant liabilities and expenses, adversely affect our ability to report our financial results in a timely manner and could have a material adverse effect on our financial condition, results of operations and cash flows.
We may still suffer cybersecurity and other incidents, which could have a material adverse effect on our business or operations. 19 Table of Contents IT system failures, network disruptions and breaches of data security could (1) cause disruption in our operations, issues with customer communication and order management, the unauthorized or unintentional disclosure of sensitive information, or disruptions in our transaction processing or (2) undermine the integrity of our disclosure controls and procedures and our internal control over financial reporting, which could affect our reputation, result in significant liabilities and expenses, adversely affect our ability to report our financial results in a timely manner and could have a material adverse effect on our financial condition, results of operations and cash flows.
Such uncertain and volatile conditions in any of our key sales or manufacturing regions can cause or exacerbate negative trends in business and consumer spending, which, in turn, have historically had a negative impact on customer demand for our products and costs of manufacturing and delivering our products.
Such conditions, particularly if present in any of our key sales or manufacturing regions, can cause or exacerbate negative trends in business and consumer spending, which, in turn, historically have increased our manufacturing and delivery costs and reduced customer demand for our products (and may do so in the future).
Any actual or alleged failure to comply with these obligations could result in inquiries, investigations, and other proceedings against us by regulatory authorities or other third parties. Our operations use hazardous materials that expose us to various risks, including potential liability for personal injury and potential remediation obligations.
Any actual or alleged failure to comply with these obligations could result in inquiries, investigations, and other proceedings against us by regulatory authorities or other third parties.
Risks Related to Government Regulation • The impact of being subject to numerous rapidly evolving environmental laws and regulations across many jurisdictions. • Risks related to the regulatory environment, including compliance costs and being subject to potentially inconsistent or conflicting regulations. • Changes in taxation or adverse tax rulings. • The impact of government incentives, including added operational complexity and competition. 15 Table of Contents Risks Related to Our Indebtedness • The impact of our indebtedness, including our ability to obtain future financing. • Risks related to our ability to generate sufficient cash to service our indebtedness. • Restrictions on our operations as a result of the terms of the Amended Credit Agreement (as defined below) and the Indentures (as defined below).
Risks Related to Government Regulation • The impact of being subject to numerous rapidly evolving environmental laws and regulations across many jurisdictions. • Risks related to the regulatory environment, including compliance costs and being subject to potentially inconsistent or conflicting regulations. • Changes in taxation or adverse tax rulings. • The impact of government incentives, including added operational complexity and competition.
We are exposed to various risks from our regulatory environment, including being subject to potentially inconsistent or conflicting laws and regulations in the jurisdictions in which we operate, international trade-related disputes and compliance costs, which may adversely impact our reputation, financial condition and results of operations.
Any such changes could increase our production costs, weaken our supply chain, or result in less competitive products and may require requalification by our customers, which could result in delays, loss of design wins, or customers transitioning to competing products.. 22 Table of Contents We are exposed to various risks from our regulatory environment, including being subject to potentially inconsistent or conflicting laws and regulations in the jurisdictions in which we operate, international trade-related disputes and compliance costs, which may adversely impact our reputation, financial condition and results of operations.
Our manufacturing processes are complex and require the use of expensive and technologically sophisticated equipment and materials. We have, on occasion, experienced manufacturing difficulties, such as critical equipment breakdowns, delayed ramp up of newly constructed or expanded manufacturing facilities or the introduction of impurities in the manufacturing process.
We have, on occasion, experienced manufacturing difficulties, such as critical equipment breakdowns, delayed ramp up of newly constructed or expanded manufacturing facilities or the introduction of impurities in the manufacturing process, which cause lower yields, delivery delays and harm our ability to serve our customers.
General Risks • Significant competition. • Our ability to successfully acquire or integrate other businesses, form joint ventures, or divest businesses. • The impact of climate change, including changes in market dynamics and stakeholder expectations, and unexpected operational disruptions.
Risks Related to Owning Our Common Stock • The volatility of the price of our common stock. • Changes in capital allocation strategy. • Provisions in our charter documents and Delaware law may delay or prevent us from being acquired. 13 Table of Contents General Risks • Significant competition. • Our ability to successfully acquire or integrate other businesses, form joint ventures, or divest businesses. • The impact of climate change, including changes in market dynamics and stakeholder expectations, and unexpected operational disruptions.
Global economic uncertainty may materially and adversely affect our business, financial condition and results of operations. Uncertain and volatile economic conditions, including uncertain and volatile financial markets, inflation, fluctuating interest rates, economic slowdowns and/or recessions, national debt and bank failures, could materially and adversely impact our operating results.
Uncertain and volatile economic conditions, including financial market instability, inflation and increased costs, trade wars, fluctuating interest rates, economic slowdowns and/or recessions, difficulties in obtaining capital, and national debt and bank failures, could materially and adversely impact our operating results.
The cancellation, reduction or deferral of purchases of our products by any one of these customers could significantly reduce our revenues in any particular quarter.
Because we have limited or no contractual recourse if our customers decided to stop buying and using our products with limited advance notice, the cancellation, reduction or deferral of purchases of our products by any one of these customers could significantly reduce our revenues in any particular quarter.
Our revenues and operating results have fluctuated in the past and may do so in the future, which could impact our stock price. Our revenues and operating results may fluctuate significantly from quarter-to-quarter or year-to-year due to a number of factors, many of which are outside our control.
Our revenues and operating results may fluctuate significantly from quarter-to-quarter or year-to-year due to a number of factors, many of which are outside our control. A lower volume of sales can have a large and disproportionate impact on our profitability because some of our expenses are fixed in the short term.
In the past, we incurred significant impairment charges for capital expenditures related to developing the capability to manufacture shippers and FOUPs for 450 millimeter wafers, which major semiconductor manufacturers announced that they would not initiate manufacturing for the foreseeable future. 20 Table of Contents We believe that our future success will depend upon our ability to continue to develop novel, mission-critical solutions to maximize our customers’ manufacturing yields and enable higher performance semiconductor devices.
In the past, we incurred significant impairment charges for capital expenditures related to developing the capability to manufacture shippers and FOUPs for 450 millimeter wafers, which major semiconductor manufacturers announced that they would not initiate manufacturing for the foreseeable future, and for other projects that failed to find commercial viability.
Our export and trade control compliance program may be ineffective or circumvented, exposing us to legal liabilities. Compliance with these laws could significantly 19 Table of Contents limit our sales in the future.
We must also comply with export control and economic sanctions laws and regulations imposed by other countries. Although we maintain an export and trade control compliance program, it may not be fully effective or may be circumvented, exposing us to legal liabilities. Compliance with these laws could significantly limit our sales in the future.
The semiconductor industry may continue to undergo consolidation, and if any of our customers merge or are acquired, we may experience lower overall sales to, or lower profitability from sales to, the merged or combined companies. Our customer base is also geographically concentrated, particularly in Taiwan, Korea, Japan, China and the U.S.
The semiconductor industry may continue to undergo consolidation, and if any of our customers merge or are acquired, we may experience lower overall sales to, or lower profitability from sales to, the merged or combined companies. Furthermore, we rely on independent distributors, in addition to our direct sales force, to market and sell certain of our products globally.
Our insurance coverage may be inadequate to satisfy any such liabilities, and our financial results or financial condition could be adversely affected.
Our insurance coverage may be inadequate to satisfy any such liabilities, and our financial results or financial condition could be adversely affected. We carry a significant amount of goodwill on our balance sheet. As of December 31, 2025, we had goodwill of $3,946.7 million.
The volume of changes to such laws, rules and regulations may increase in the countries where we operate. Changes in or ambiguous interpretations of laws, regulations and standards may create uncertainty regarding compliance matters.
Changes in or ambiguous interpretations of laws, regulations and standards, and the speed with which new regulations may be enacted and come into effect, may create uncertainty regarding compliance matters or instances where we may not be in full compliance.
Each of these laws, rules and regulations imposes costs on our business, including financial costs and potential diversion of our management’s attention, and may present risks to our business, including potential fines, restrictions on our actions and reputational damage if we do not fully comply.
These instances present risks to our business, including potential fines, restrictions on our actions and reputational damage. The volume of changes to such laws, rules and regulations may increase in the countries where we operate.
Risks Related to Our Business and Industry Our revenue is primarily dependent upon demand from the global semiconductor ecosystem and fluctuations in demand for semiconductors and the overall volume of semiconductor manufacturing may decrease demand for our products and may adversely affect our business. Our revenue is primarily dependent upon demand from the global semiconductor ecosystem.
Risks Related to Our Business and Industry Our revenue is primarily dependent upon demand from the global semiconductor ecosystem. Fluctuations in demand, whether from industry cyclicality, changes in consumer spending, macroeconomic conditions, or other factors, may cause our revenues and operating results to vary significantly, which could adversely affect our business.
A significant portion of our sales is concentrated on a limited number of key customers, and our net sales and profitability may materially decline if we were to lose one or more of these customers. Sales to a limited number of large customers constitute a significant portion of our overall revenue, shipments, cash flows, collections and profitability.
These measures could also increase our costs (including logistics, compliance, and supplier qualification costs), disrupt our sourcing and manufacturing plans, and adversely affect our ability to meet customer requirements or contractual commitments. 17 Table of Contents A significant portion of our sales is concentrated on a limited number of key customers, and our net sales and profitability may materially decline if we were to lose one or more of these customers.
Because a significant amount of our sales and manufacturing activity occurs outside the U.S., we are exposed to risks inherent in operating a global business. Sales to customers outside the U.S. accounted for approximately 79%, 75% and 76% of our net sales in 2024, 2023 and 2022, respectively.
Because a significant amount of our sales and manufacturing activity occurs outside the U.S., we are exposed to risks inherent in operating a global business, including changes in economic policy, geopolitical tensions and challenges in managing a diverse workforce and operating under differing business and legal environments, which may harm our reputation or profitability.
For example, new or modified regulations could require us to make substantial expenditures to enhance our environmental compliance efforts.
New or modified regulations could require us to make substantial expenditures to enhance our environmental compliance efforts, or to reformulate our products or substitute raw materials or components with alternatives that may be more expensive, less readily available, or inferior in quality or performance.
In addition, if new products have reliability or quality problems, we may experience reduced orders, higher manufacturing costs, delays in acceptance and payment, additional service and warranty expense and damage to our reputation. Manufacturing interruptions or delays, or other disruptions to our operations, could adversely affect our business, financial condition, results of operations and reputation.
A failure to satisfy these customer standards or to comply with industry, regulatory and technical requirements may 18 Table of Contents result in reduced orders, higher manufacturing costs, delays in acceptance and payment, additional service and warranty expense and damage to our reputation, which may adversely affect our revenue and results of operations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

10 edited+3 added−2 removed11 unchanged
Biggest changeThe CISO works closely with members of our Executive Leadership Team and his cybersecurity team to monitor the prevention, detection, mitigation, and remediation of cybersecurity incidents. We engage a third-party managed security services provider (MSSP) to provide 24/7 continuous monitoring of the Company’s IT and operational technology environments for potential cybersecurity incidents.
Biggest changeMonitoring of Cybersecurity Incidents Our Cybersecurity Incident Response Plan establishes how we monitor and respond to cybersecurity incidents impacting our environment. The CISO works closely with members of our Executive Leadership Team and his cybersecurity team to monitor the prevention, detection, mitigation, and remediation of cybersecurity incidents.
To increase our employees’ vigilance of cybersecurity risks and educate them on best practices relating to those risks, we conduct cybersecurity trainings and awareness campaigns, such as quarterly phishing campaigns.
To increase our employees’ vigilance of cybersecurity risks and educate them on best practices relating to those risks, we conduct quarterly awareness sessions, annual trainings and monthly phishing campaigns.
Engagement of Third Parties Given the complex and evolving nature of cybersecurity threats, the Company periodically engages third parties to assist us in evaluating our security vulnerabilities and developing and maintaining effective cybersecurity risk management. Partnering with third parties enables us to leverage specialized knowledge and insights, ensuring our cybersecurity strategies and processes are well-designed and effective.
Engagement of Third Parties 28 Table of Contents Given the complex and evolving nature of cybersecurity threats, the Company periodically engages third parties to assist us in evaluating our security vulnerabilities and developing and maintaining effective cybersecurity risk management.
Our CISO, together with our CIDO, provide quarterly updates to our Audit and Finance Committee regarding the cybersecurity risk landscape, specific risks affecting the Company and 30 Table of Contents solutions to mitigate those risks, and legal and regulatory requirements relating to cybersecurity. These updates assist the Board in performing its oversight and risk management function.
Our Audit and Finance Committee is composed of independent directors with extensive executive leadership and risk management experience. Our CISO, together with our CIDO, provide quarterly updates to our Audit and Finance Committee regarding the cybersecurity risk landscape, specific risks affecting the Company and solutions to mitigate those risks, and legal and regulatory requirements relating to cybersecurity.
As part of this process, our risk management team works closely with our IT department to identify and evaluate potential cybersecurity risks to the Company and to develop controls to mitigate and protect against those risks. 29 Table of Contents Each quarter, our Chief Information Security Officer (“CISO”) presents an overview of the Company’s cybersecurity risk landscape to our Enterprise Risk Management Committee, which includes our Executive Leadership Team and Vice President, Internal Audit.
Each quarter, our Chief Information Security Officer (“CISO”) presents an overview of the Company’s cybersecurity risk landscape to our Enterprise Risk Management Committee, which includes our Executive Leadership Team and Vice President, Internal Audit.
In addition, the full Board receives an annual report on cybersecurity directly from the CISO. Management’s Role Managing Risk Our CISO is responsible for the implementation, operation and monitoring of our cybersecurity risk management program. Our current CISO, who reports to our CIDO, has over 20 years of experience managing the IT and cybersecurity operations within large, global organizations.
These updates assist the Board in performing its oversight and risk management function. In addition, the full Board receives an annual report on cybersecurity directly from the CISO. Management’s Role Managing Risk Our CISO is responsible for the implementation, operation and monitoring of our cybersecurity risk management program.
In the event such an incident is identified by our MSSP or any of our employees, our cybersecurity team assigns it a severity classification and escalates the incident accordingly.
We engage a third-party managed security services provider (MSSP) to provide 24/7 continuous monitoring of the Company’s IT and operational technology environments for potential cybersecurity incidents. In the event such an incident is identified by our MSSP or any of our employees, our cybersecurity team assigns it a severity classification and escalates the incident accordingly.
The CISO receives regular updates on all incidents and incident responses, which the CISO shares with our Executive Leadership Team on a weekly basis. Our cybersecurity team conducts a post-incident review of all major cybersecurity incidents, which review includes identification of vulnerabilities, assessment of the incident’s impact on the Company and recommendations to help prevent similar incidents in the future.
Our cybersecurity team conducts a post-incident review of all major cybersecurity incidents, which review includes identification of vulnerabilities, assessment of the incident’s impact on the Company and recommendations to help prevent similar incidents in the future. See “Item 1A. Risk Factors” for a more detailed description of the cybersecurity risks we face. 30 Table of Contents
For example, in 2023, we engaged a global law firm to conduct an external assessment of our cybersecurity governance framework and processes and provide recommendations to improve our cybersecurity readiness and posture. We also work with third party specialists who perform threat and vulnerability assessments, such as penetration testing, and develop strategies to mitigate cybersecurity-related risks.
Partnering with third parties enables us to leverage specialized knowledge and insights, ensuring our cybersecurity strategies and processes are well-designed and effective. For example, in 2023, we engaged a global law firm to conduct an external assessment of our cybersecurity governance framework and processes and provide recommendations to improve our cybersecurity readiness and posture.
His extensive experience assessing and mitigating cybersecurity risk, implementing governance structures and developing employee training programs is critical in developing and executing our cybersecurity strategies. Monitoring of Cybersecurity Incidents Our Cybersecurity Incident Response Plan establishes how we monitor and respond to cybersecurity incidents impacting our environment.
Our current CISO, who reports to our CIDO, has over 20 years of experience managing the IT and cybersecurity operations within large, global organizations. His extensive experience assessing and mitigating cybersecurity risk, implementing governance structures and developing employee training programs is critical in developing and executing our cybersecurity strategies.
Removed
Our Audit and Finance Committee is composed of independent directors with extensive executive leadership and risk management experience.
Added
As part of this process, our risk management team works closely with our IT department to identify and evaluate potential cybersecurity risks to the Company and to develop controls to mitigate and protect against those risks.
Removed
See “Item 1A. Risk Factors” for a more detailed description of the cybersecurity risks we face. 31 Table of Contents
Added
Each year, to prevent and mitigate cybersecurity-related risks, we engage independent cybersecurity specialists to conduct comprehensive threat and vulnerability assessments, such as penetration testing, social engineering evaluations and structured tabletop exercises. Their findings help validate our controls, test our response capabilities and inform strategies our strategies to manage and reduce enterprise cybersecurity risk.
Added
The CISO receives regular updates on all incidents and incident responses, which the CISO shares with our Executive 29 Table of Contents Leadership Team on a weekly basis.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeIn addition, we own and lease space for manufacturing, distribution, technical support, sales, service, repair, and general administrative purposes in the U.S., Canada, China, Germany, France, Israel, Japan, Malaysia, Singapore, South Korea and Taiwan. Leases for our facilities expire through October 2031.
Biggest changeItem 2. Properties. We own and lease facilities for manufacturing, distribution, technical support, sales, service, repair, and general administrative purposes primarily located in the United States, Canada, Taiwan, South Korea, Japan, China, Singapore, Malaysia, Germany, France and Israel.
We currently expect to be able to extend the terms of expiring leases or to find suitable replacement facilities on reasonable terms. We believe that our facilities are well-maintained and suitable for their respective operations. We regularly assess the size, capability and location of our global infrastructure and periodically make adjustments based on these assessments.
We believe that our facilities are well-maintained and suitable for their respective operations. We regularly assess the size, capability and location of our global infrastructure and periodically make adjustments based on these assessments.
Removed
Item 2. Properties. Our principal executive offices are located in Billerica, Massachusetts.
Added
As of December 31, 2025, we owned and leased approximately 3.7 million square feet and 1.9 million square feet of space, respectively, across 72 owned and 31 leased properties. Our principal executive offices are located in Billerica, Massachusetts. Because of the interrelation of our operations, properties in certain geographical locations may be attributable to multiple reporting segments.
Removed
Information about our principal and certain other facilities is set forth below: Location Principal Function Approximate Square Feet Leased/ Owned Reporting Segment Bedford, Massachusetts Research & Manufacturing 80,000 Owned APS & MS Billerica, Massachusetts (1) Executive Offices, Research & Manufacturing 175,000 Leased APS & MS Burnet, Texas Research & Manufacturing 86,000 Owned MS Decatur, Texas Manufacturing 359,000 Owned MS Chaska, Minnesota Executive Offices, Research & Manufacturing 186,000 Owned APS Colorado Springs, Colorado Manufacturing 82,000 Owned APS Danbury, Connecticut Research & Manufacturing 73,000 Leased MS San Luis Obispo, California Manufacturing 57,867 Owned APS San Luis Obispo, California Manufacturing 59,124 Leased APS Aurora, Illinois Manufacturing 414,000 Owned MS Hillsboro, Oregon Manufacturing 112,344 Leased MS Hsin-chu, Taiwan Executive Offices, Sales Research & Manufacturing 146,330 Leased APS & MS Kaohsiung City,Taiwan (North) Manufacturing 105,874 Owned MS Kaohsiung City,Taiwan (South) Manufacturing 573,696 Owned APS & MS JangAn, South Korea Manufacturing 127,000 Owned APS & MS Oseong, South Korea Manufacturing 108,355 Owned MS Suwon, South Korea Executive Offices & Research 42,000 Leased APS & MS Kulim, Malaysia Manufacturing 195,000 Owned APS & MS Yonezawa, Japan Manufacturing 185,000 Owned APS Tsu, Mie, Japan Manufacturing 160,259 Owned MS Singapore Manufacturing 47,770 Owned MS (1) This lease has been extended through September 30, 2026 and is subject to one five-year renewal option.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed3 unchanged
Biggest changeBased on the current information, the Company does not believe any known matters have a reasonable possibility of a material amount for litigation or other contingencies related to legal proceedings. Item 4. Mine Safety Disclosures. Not applicable. 32 Table of Contents PART II
Biggest changeBased on the current information, the Company does not believe any known matters have a reasonable possibility of a material amount for litigation or other contingencies related to legal proceedings. Item 4. Mine Safety Disclosures. Not applicable. 31 Table of Contents PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

1 edited+0 added−0 removed0 unchanged
Biggest changeItem 4. Mine Safety Disclosures 32 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 33 Item 6. Reserved 34 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 35 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 49 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 31 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 32 Item 6. Reserved 33 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 34 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 46 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAll rights reserved. 33 Table of Contents December 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 Entegris, Inc. $100.00 $192.83 $278.79 $132.44 $243.04 $201.58 Nasdaq Composite 100.00 144.92 177.06 119.45 172.77 223.86 Philadelphia Semiconductor Index 100.00 153.66 219.50 142.94 238.72 287.31 Issuer Purchases of Equity Securities The Company does not have a publicly announced stock repurchase program and we did not repurchase any equity securities during the year ended December 31, 2024.
Biggest changeAll rights reserved. 32 Table of Contents December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 December 31, 2025 Entegris, Inc. $100.00 $144.58 $68.68 $126.04 $104.54 $89.31 Nasdaq Composite 100.00 122.18 82.42 119.22 154.47 187.13 Philadelphia Semiconductor Index 100.00 142.85 93.02 155.35 186.98 268.23 Issuer Purchases of Equity Securities The Company does not have a publicly announced stock repurchase program and we did not repurchase any equity securities during the year ended December 31, 2025.
Comparative Stock Performance The following graph compares the cumulative total shareholder return on the common stock of Entegris, Inc. from December 31, 2019 through December 31, 2024 with the cumulative total return on (1) The Nasdaq Composite Index, and (2) The Philadelphia Semiconductor Index, assuming $100 was invested at the close of trading on December 31, 2019 in Entegris, Inc. common stock, the Nasdaq Composite Index and the Philadelphia Semiconductor Index and that all dividends are reinvested.
Comparative Stock Performance The following graph compares the cumulative total shareholder return on the common stock of Entegris, Inc. from December 31, 2020 through December 31, 2025 with the cumulative total return on (1) The Nasdaq Composite Index, and (2) The Philadelphia Semiconductor Index, assuming $100 was invested at the close of trading on December 31, 2020 in Entegris, Inc. common stock, the Nasdaq Composite Index and the Philadelphia Semiconductor Index and that all dividends are reinvested.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information and Holders Entegris’ common stock, $0.01 par value per share, trades on the Nasdaq Global Select Market under the symbol “ENTG”. As of February 5, 2025, there were 965 shareholders of record.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information and Holders Entegris’ common stock, $0.01 par value per share, trades on the Nasdaq Global Select Market under the symbol “ENTG”. As of February 6, 2026, there were 907 shareholders of record.
Dividend Policy Holders of the Company’s common stock are entitled to receive dividends when and if they are declared by the Company’s Board of Directors. The Company’s Board of Directors declared cash dividends of $0.10 per share during each of the first, second, third and fourth quarters of 2024, which totaled $60.7 million.
Dividend Policy Holders of the Company’s common stock are entitled to receive dividends when and if they are declared by the Company’s Board of Directors. The Company’s Board of Directors declared cash dividends of $0.10 per share during each of the first, second, third and fourth quarters of 2025, which totaled $61.1 million.
On January 15, 2025, the Company’s Board of Directors declared a quarterly cash dividend of $0.10 per share to be paid on February 19, 2025 to shareholders of record as of January 29, 2025. The Company currently expects to continue paying dividends comparable with our historic dividend practices.
On January 14, 2026, the Company’s Board of Directors declared a quarterly cash dividend of $0.10 per share to be paid on February 18, 2026 to shareholders of record as of January 28, 2026. The Company currently expects to continue paying dividends comparable with our historic dividend practices.

Item 7. Management's Discussion & Analysis

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

73 edited+25 added−35 removed34 unchanged
Biggest changeThese costs arise outside of the ordinary course of our continuing operations. 7 Restructuring charges resulting from cost saving initiatives. 8 Represents an asset reduction of an acquired tax equalization asset from the CMC Materials acquisition. 9 (Gain) loss from the sale of certain businesses and held-for-sale assets, net. 10 Gain on termination of the alliance agreement with MacDermid Enthone. 11 Impairment of long-lived assets. 12 Non-cash amortization expense associated with intangibles acquired in acquisitions. 47 Table of Contents The reconciliation of GAAP measures to Non-GAAP EPS for the years ended December 31, 2024 and 2023 are presented below: (In thousands, except per share data) 2024 2023 Net income $ 292,787 $ 180,669 Adjustments to net income: Goodwill impairment 1 — 115,217 Deal and transaction costs 2 — 3,001 Integration costs: Professional fees 3 2,574 36,650 Severance costs 4 794 1,478 Retention costs 5 — 1,687 Other costs 6 — 13,710 Restructuring costs 7 3,930 14,745 Patent infringement settlement gain, net 8 (20,033) — Acquired tax equalization asset reduction 9 2,959 — Loss on extinguishment of debt and modification 10 14,348 29,896 (Gain) loss on sale of businesses and held-for-sale assets, net 11 (4,311) 23,839 Gain on termination of alliance agreement 12 — (184,754) Infineum termination fee, net 13 — (10,877) Impairment on long-lived assets 14 12,967 30,464 Amortization of intangible assets 15 190,119 214,477 Tax effect of adjustments to net income and discrete tax items 16 (40,146) (71,284) Non-GAAP net income $ 455,988 $ 398,918 Diluted earnings per common share $ 1.93 $ 1.20 Effect of adjustments to net income $ 1.07 $ 1.45 Diluted non-GAAP earnings per common share $ 3.00 $ 2.64 Diluted weighted average shares outstanding 151,840 150,945 1 Non-cash impairment charges associated with goodwill of our Electronic Chemicals and a small, industrial specialty chemicals businesses. 2 Deal and transaction costs associated with the CMC Materials acquisition and completed divestitures. 3 Represents professional and vendor fees recorded in connection with services provided by consultants, accountants, lawyers and other third-party service providers to assist us in integrating CMC Materials into our operations. 4 Represents severance charges related to the integration of the CMC Materials acquisition. 5 Represents retention charges related directly to the CMC Materials acquisition and completed divestitures, and are not part of our normal, recurring cash operating expenses. 6 Represents other employee-related costs and other costs incurred relating to the CMC Materials acquisition and the completed divestitures.
Biggest changeThe reconciliation of GAAP measures to Adjusted Operating Income and Adjusted EBITDA for the years ended December 31, 2025 and 2024 are presented below: 44 Table of Contents (In millions) 2025 2024 Net sales $ 3,196.6 $ 3,241.2 Net income $ 235.6 $ 292.8 Net income - as a % of net sales 7.4 % 9.0 % Adjustments to net income Equity in net loss of affiliates 1.0 0.9 Income tax expense 18.0 28.3 Interest expense 199.8 215.2 Interest income (7.9) (7.3) Other expense, net 9.4 4.0 GAAP – Operating income 455.9 533.9 Operating margin - as a % of net sales 14.3 % 16.5 % Integration costs: Professional fees 1 — 2.6 Severance costs 2 — 0.8 Restructuring costs 3 29.7 3.9 Acquired tax equalization asset reduction 4 — 3.0 Loss (gain) on sale of businesses, net 5 10.9 (4.3) Impairment of long-lived assets 6 — 13.0 Amortization of intangible assets 7 184.4 190.1 Adjusted Operating Income 680.9 743.0 Adjusted Operating Margin 21.3 % 22.9 % Depreciation 205.3 188.1 Adjusted EBITDA $ 886.2 $ 931.1 Adjusted EBITDA – as a % of net sales 27.7 % 28.7 % 1 Represents professional and vendor fees recorded in connection with services provided by consultants, accountants, lawyers and other third-party service providers to assist us in integrating CMC Materials into our operations. 2 Represents severance charges related to the integration of the CMC Materials acquisition. 3 Restructuring charges resulting from discrete cost saving initiatives inclusive of employee termination benefit, contract termination costs and asset impairment charges, primarily related to (i) an internal reorganization, combining two complementary divisions into one and realigning our customer facing organization and (ii) workforce reductions, contract termination costs and the abandonment of certain capital equipment no longer necessary for the Company’s long-term objectives. 4 Represents an asset reduction of an acquired tax equalization asset from the CMC Materials acquisition. 5 Loss (gain) from the sale of the Company’s PIM and small, industrial specialty chemicals businesses. 6 Impairment of long-lived assets related to a small, industrial specialty chemicals business. 7 Non-cash amortization expense associated with intangibles acquired in acquisitions. 45 Table of Contents The reconciliation of GAAP measures to Non-GAAP EPS for the years ended December 31, 2025 and 2024 are presented below: (In thousands, except per share data) 2025 2024 Net income $ 235.6 $ 292.8 Adjustments to net income: Integration costs: Professional fees 1 — 2.6 Severance costs 2 — 0.8 Restructuring costs 3 29.7 3.9 Patent infringement settlement gain, net 4 — (20.0) Acquired tax equalization asset reduction 5 — 3.0 Loss on extinguishment of debt and modification 6 3.2 14.3 Loss (gain) on sale of businesses, net 7 10.9 (4.3) Impairment on long-lived assets 8 — 13.0 Amortization of intangible assets 9 184.4 190.1 Tax effect of adjustments to net income and discrete tax items 10 (45.3) (40.2) Non-GAAP net income $ 418.5 $ 456.0 Diluted earnings per common share $ 1.55 $ 1.93 Effect of adjustments to net income $ 1.20 $ 1.08 Diluted non-GAAP earnings per common share $ 2.75 $ 3.00 Diluted weighted average shares outstanding 152.2 151.8 1 Represents professional and vendor fees recorded in connection with services provided by consultants, accountants, lawyers and other third-party service providers to assist us in integrating CMC Materials into our operations. 2 Represents severance charges related to the integration of the CMC Materials acquisition. 3 Restructuring charges resulting from discrete cost saving initiatives inclusive of employee termination benefit, contract termination costs and asset impairment charges, primarily related to (i) an internal reorganization, combining two complementary divisions into one and realigning our customer facing organization and (ii) workforce reductions, contract termination costs and the abandonment of certain capital equipment no longer necessary for the Company’s long-term objectives. 4 During the fourth quarter of 2024, the Company settled patent infringement litigation and received net proceeds of $20.0 million. 5 Represents an asset reduction of an acquired tax equalization asset from the CMC Materials acquisition. 6 Loss on extinguishment of debt in 2024 and 2025 and modification of our Existing Credit Agreement in 2024. 7 Loss (gain) from the sale of the Company’s PIM and small, industrial specialty chemicals businesses. 8 Impairment of long-lived assets related to a small, industrial specialty chemicals business. 9 Non-cash amortization expense associated with intangibles acquired in acquisitions. 10 The tax effect of pre-tax adjustments to net income was calculated using the applicable marginal tax rate for each respective year.
In 2024, other expense, net consisted mainly of loss of extinguishment and modification of debt of $14.3 million associated with the repayments and the Third Amendment on the Company’s senior secured term loan facility (see Note 10 to the Company’s consolidated financial statements) and foreign currency transaction losses of $7.7 million, partially offset by a gain of $20.0 million related to the settlement of patent infringement litigation.
In 2024, other expense, net consisted mainly of loss of extinguishment and modification of debt of $14.3 million associated with the repayments and the Third Amendment on the Company’s senior secured term loan facility (see Note 9 to the Company’s consolidated financial statements) and foreign currency transaction losses of $7.7 million, partially offset by a gain of $20.0 million related to the settlement of patent infringement litigation.
These risks and uncertainties include, but are not limited to, fluctuations in the demand for semiconductors and the overall volume of semiconductor manufacturing; the impact of global economic uncertainty, including volatile financial markets, inflationary pressures and interest rate fluctuations, economic recessions, national debt and bank failures, raw material shortages, supply and labor constraints, and price increases; fluctuations in the Company’s revenues and operating results and their impact on the Company’s stock price; supply chain interruptions and the Company’s dependence on sole, single and limited source suppliers; operational, political and legal risks of the Company’s international operations; the impact of regional and global instabilities, hostilities and geopolitical uncertainty, including, but not limited to, the ongoing conflicts between Ukraine and Russia, and between Israel and Hamas, as well as the global responses thereto; tariffs, additional taxes, and other protectionist measures resulting from international trade disputes, strained international relations, and changes in foreign and national security policy; export controls, economic sanctions, and similar restrictions; the concentration and consolidation of the Company’s customer base; the Company’s ability to meet rapid demand shifts; the Company’s ability to continue technological innovation and to introduce new products to meet customers’ rapidly changing requirements; manufacturing and other operational disruptions or delays; the risks associated with the use and manufacture of hazardous materials; goodwill impairment; challenges in attracting and retaining qualified personnel; the Company’s ability to protect and enforce intellectual property rights; IT system failures, network disruptions, and cybersecurity risks; the Company’s environmental, social, and governance commitments; legal and regulatory risks, including changes in laws and regulations related to the environment, health and safety, accounting standards, and corporate governance, across the jurisdictions in which the Company operates; changes in taxation or adverse tax rulings; the Company’s ability to effectively implement any organizational changes; the ability to obtain government incentives and the possibility that competitors will benefit from government incentives; the amount and consequences of the Company’s indebtedness, its ability to repay its debt and to obtain future financing, and the Company’s obligations under its current outstanding credit facilities; volatility in the Company’s stock price; the payment of cash dividends and the adoption of future share repurchase programs; challenges associated with a potential change of control; substantial competition; the Company’s ability to identify, complete and integrate acquisitions, joint ventures, divestitures or other similar transactions; the impacts of climate change; and other matters.
These risks and uncertainties include, but are not limited to, fluctuations in the demand for semiconductors; the impact of global economic uncertainty, including volatile financial markets, inflationary pressures and interest rate fluctuations, economic recessions, national debt and bank failures, raw material shortages, supply constraints, and price increases; supply chain interruptions and the Company’s dependence on sole, single and limited source suppliers; operational, political and legal risks associated with the Company’s international operations, including those related to geopolitical uncertainty and regional and global instabilities and hostilities, including, but not limited to, the ongoing conflicts between Ukraine and Russia, and between Israel and Hamas, as well as the global responses thereto; export controls, economic sanctions, and similar restrictions; the concentration and consolidation of the Company’s customer base; the Company’s ability to meet rapid demand shifts; the Company’s ability to continue technological innovation and to introduce new products to meet customers’ rapidly changing requirements; manufacturing and other operational disruptions or delays; IT system failures, network disruptions, and cybersecurity risks; tariffs, additional taxes and other protectionist measures resulting from international trade disputes, strained international relations and changes in foreign and national security policy; the risks associated with the use and manufacture of hazardous materials; goodwill impairment; challenges in attracting and retaining qualified personnel; the Company’s ability to protect and enforce intellectual property rights; artificial intelligence; the Company’s environmental, social, and governance commitments; legal and regulatory risks, including changes in laws and regulations related to the environment, health and safety, accounting standards, and corporate governance, across the jurisdictions in which the Company operates; changes in taxation or adverse tax rulings; the Company’s ability to effectively implement any organizational changes; the ability to obtain government incentives and the possibility that competitors will benefit from government incentives; the amount and consequences of the Company’s indebtedness, its ability to repay its debt and to obtain future financing, and the Company’s obligations under its current outstanding credit facilities; volatility in the Company’s stock price; the payment of cash dividends and the adoption of future share repurchase programs; challenges associated with a potential change of control; substantial competition; the Company’s ability to identify, complete and integrate acquisitions, joint ventures, divestitures or other similar transactions; the impacts of climate change; and other matters.
We have contractual obligations for principal and interest payments on our long-term debt. See Note 10 of the consolidated financials for additional information. Debt obligations are classified based on their stated maturity date, regardless of their classification on the Company’s consolidated balance sheets.
We have contractual obligations for principal and interest payments on our long-term debt. See Note 9 of the consolidated financials for additional information. Debt obligations are classified based on their stated maturity date, regardless of their classification on the Company’s consolidated balance sheets.
Internally, these non-GAAP measures are used by management for planning and forecasting purposes, including the preparation of internal budgets; for allocating resources to enhance financial performance; for evaluating the effectiveness of operational strategies; and for evaluating the Company’s capacity to fund capital expenditures, secure financing and expand its business.
Internally, these non-GAAP measures are used by management for planning and forecasting purposes, including the preparation 43 Table of Contents of internal budgets; for allocating resources to enhance financial performance; for evaluating the effectiveness of operational strategies; and for evaluating the Company’s capacity to fund capital expenditures, secure financing and expand its business.
During the twelve months ended December 31, 2024, the Company borrowed and repaid $140.0 million under this Revolving Facility and no balance was outstanding at December 31, 2024. The Company also has a line of credit with one bank that provides for borrowings of Japanese yen for the Company’s Japanese subsidiary equivalent to an aggregate of approximately $6.4 million.
During the twelve months ended December 31, 2025, the Company borrowed and repaid $567.0 million under this Revolving Facility and no balance was outstanding at December 31, 2025. The Company also has a line of credit with one bank that provides for borrowings of Japanese yen for the Company’s Japanese subsidiary equivalent to an aggregate of approximately $6.4 million.
Critical Accounting Policies and Estimates Management’s discussion and analysis of financial condition and results of operations are based upon the Company’s consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).
Critical Accounting Policies and Estimates 35 Table of Contents Management’s discussion and analysis of financial condition and results of operations are based upon the Company’s consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).
Information pertaining to fiscal year 2022 results of operations and the year-over-year comparison of changes in our Financial Condition and Results of Operations as of and for the year ended December 31, 2023 and 2022 can be found in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2023, filed on February 15, 2024.
Information pertaining to fiscal year 2023 results of operations and the year-over-year comparison of changes in our Financial Condition and Results of Operations as of and for the year ended December 31, 2024 and 2023 can be found in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2024, filed on February 12, 2025.
There can be no assurance that any such financing would be available on commercially acceptable terms, or at all. During 2024, we did not experience difficulty accessing capital and credit markets, but future volatility in the capital and credit markets may increase costs associated with issuing debt instruments or affect our ability to access those markets.
There can be no assurance that any such financing would be available on commercially acceptable terms, or at all. During 2025, we did not experience difficulty accessing capital and credit 40 Table of Contents markets, but future volatility in the capital and credit markets may increase costs associated with issuing debt instruments or affect our ability to access those markets.
See Note 20 to the consolidated financial statements for additional information on the Company’s two segments. 40 Table of Contents The following table and discussion reflects the results of operations of the Company’s two reportable segments for the years ended December 31, 2024, 2023 and 2022.
See Note 20 to the consolidated financial statements for additional information on the Company’s two segments. 39 Table of Contents The following table and discussion reflects the results of operations of the Company’s two reportable segments for the years ended December 31, 2025, 2024 and 2023.
Interest expense Interest expense was $215.2 million in 2024 and $312.4 million in 2023. Interest expense includes interest associated with debt outstanding and the amortization of debt issuance costs associated with such borrowings. The decrease reflects lower interest expense related to lower average debt balances for the period due to repayments on the Company’s outstanding debt.
Interest expense Interest expense was $199.8 million in 2025 and $215.2 million in 2024. Interest expense includes interest associated with debt outstanding and the amortization of debt issuance costs associated with such borrowings. The decrease reflects lower interest expense related to lower average debt balances for the period due to repayments on the Company’s outstanding debt.
If circumstances change during interim periods between annual tests that would more likely than not reduce the fair value of a reporting unit below its carrying value, the Company will test goodwill for impairment.
Goodwill Goodwill is tested for impairment annually as of August 31. If circumstances change during interim periods between annual tests that would more likely than not reduce the fair value of a reporting unit below its carrying value, the Company will test goodwill for impairment.
The Company also utilizes certain non-GAAP financial measures as a complement to financial measures provided in accordance with GAAP in order to better assess and reflect trends affecting the Company’s business and results of operations.
Non-GAAP Information The Company’s consolidated financial statements are prepared in conformity with GAAP. The Company also utilizes certain non-GAAP financial measures as a complement to financial measures provided in accordance with GAAP in order to better assess and reflect trends affecting the Company’s business and results of operations.
These valuation techniques use estimates and assumptions including, but not limited to, the determination of appropriate market comparable, projected future cash flows (including timing and profitability), the discount rate reflecting the risk inherent in future cash flows, the perpetual growth rate, and projected future economic and market conditions.
These valuation techniques use estimates and assumptions including, but not limited to, the determination of appropriate market comparable, projected future revenue growth and gross margins, the discount rate reflecting the risk inherent in future cash flows, the terminal growth rate, and projected future economic and market conditions.
The increase in sales to customers in Taiwan primarily relates to increased demand for our APS products. The increase in sales to customers in China primarily relates to increased demand for our MS and APS products. The decrease in sales to customers in South Korea primarily relates to decreased demand for our MS and APS products.
The increase in sales to customers in Taiwan primarily relates to increased demand for our MS and APS products. The decrease in sales to customers in China primarily relates to decreased demand for our APS products, partially offset by increased demand for our MS products.
However, it is reasonably possible that there could be significant changes to our unrecognized tax benefits in the next twelve months due to an unforeseeable event (such as a tax audit settlement).
However, it is reasonably possible that there could be significant changes to our unrecognized tax benefits in the next twelve months due to an unforeseeable event (such as a tax audit settlement). See Note 16 of the consolidated financials for additional information.
On January 15, 2025, the Company’s board of directors declared a quarterly cash dividend of $0.10 per share to be paid on February 19, 2025 to shareholders of record as of January 29, 2025.
On January 14, 2026, the Company’s board of directors declared a quarterly cash dividend of $0.10 per share to be paid on February 18, 2026 to shareholders of record as of January 28, 2026.
Selling, general and administrative expenses Selling, general and administrative (“SG&A”) expenses consist primarily of payroll and related expenses for the sales and administrative staff, professional fees (including accounting, legal and technology costs and expenses), and sales and marketing costs. SG&A expenses for 2024 decreased $129.6 million, or 22%, to $446.6 million from $576.2 million in 2023.
Selling, general and administrative expenses Selling, general and administrative (“SG&A”) expenses consist primarily of payroll and related expenses for the sales and administrative staff, professional fees (including accounting, legal and technology costs and expenses), and sales and marketing costs. SG&A expenses for 2025 increased $4.0 million, or 1%, to $450.6 million from $446.6 million in 2024.
Second, the Company’s non-GAAP financial measures exclude items such as amortization and depreciation that are recurring. Amortization of intangibles and depreciation have been, and will continue to be for the foreseeable future, significant recurring expenses with an impact upon the Company’s results of operations, notwithstanding the lack of immediate impact upon cash flows.
Amortization of intangibles and depreciation have been, and will continue to be for the foreseeable future, significant recurring expenses with an impact upon the Company’s results of operations, notwithstanding the lack of immediate impact upon cash flows.
Net income Net income was $292.8 million, or $1.93 per diluted share, in 2024 compared to net income of $180.7 million, or $1.20 per diluted share, in 2023. The increase reflects the Company’s aforementioned operating results described in greater detail above.
Net income Net income was $235.6 million, or $1.55 per diluted share, in 2025 compared to net income of $292.8 million, or $1.93 per diluted share, in 2024. The decrease reflects the Company’s aforementioned operating results described in greater detail above.
These segments share common business systems and processes, technology centers and technology roadmaps. ▪ The Materials Solutions segment, or MS, provides materials-based solutions, such as chemical vapor and atomic layer deposition materials, chemical mechanical planarization (“CMP”) slurries and pads, ion implantation specialty gases, formulated etch and clean materials, and other specialty materials that enable our customers to achieve better device performance and faster time to yield, while providing for lower total cost of ownership. ▪ The Advanced Purity Solutions segment, or APS, offers filtration, purification and contamination-control solutions that improve customers’ yield, device reliability and cost by ensuring the purity of critical liquid chemistries and gases and the cleanliness of wafers and other substrates used throughout semiconductor manufacturing processes, the semiconductor ecosystem and other high-technology industries.
We leverage our unique breadth of capabilities to provide customers with innovative, science-based solutions to their toughest technology challenges, helping improve productivity and product performance in the most advanced manufacturing environments. 34 Table of Contents Our business is organized and operated in two operating segments. ▪ The Materials Solutions segment, or MS, provides materials-based solutions, such as chemical vapor and atomic layer deposition materials, chemical mechanical planarization (“CMP”) slurries and pads, ion implantation specialty gases, formulated etch and clean materials, and other specialty materials that enable our customers to achieve better device performance and faster time to yield, while providing for lower total cost of ownership. ▪ The Advanced Purity Solutions segment, or APS, offers filtration, purification and contamination-control solutions that improve customers’ yield, device reliability and cost by ensuring the purity of critical liquid chemistries and gases and the cleanliness of wafers and other substrates used throughout semiconductor manufacturing processes, the semiconductor ecosystem and other high-technology industries.
Compared to 2023, the $12.8 million decrease in cash provided by operating activities in 2024 was primarily driven by $174.5 million of changes in operating assets and liabilities, offset by a $161.7 million increase of net income adjusted for non-cash reconciling items.
Compared to 2024, the $63.7 million increase in cash provided by operating activities in 2025 was primarily driven by $101.6 million of changes in operating assets and liabilities, partially offset by a $37.9 million decrease of net income adjusted for non-cash reconciling items.
If a reporting unit fails the quantitative impairment test, impairment expense is immediately recorded as the difference between the reporting unit’s fair value and carrying value not to exceed the amount of goodwill recorded.
If a reporting unit fails the quantitative impairment test, impairment expense is immediately recorded as the difference between the reporting unit’s fair value and carrying value not to exceed the amount of goodwill recorded. We recorded no impairment charges related to goodwill during the fiscal years ended December 31, 2025 and 2024.
Changes in operating assets and liabilities were driven by changes in trade accounts and notes receivable, inventories and accounts payable and accrued liabilities. The change for trade receivables was mainly due to increased sales at the end of the period. The change for inventory was driven by increased business activity.
Changes in operating assets and liabilities were driven by changes in trade accounts and notes receivable, inventories and income taxes payable and refundable income taxes. The change for trade receivables was mainly due to timing of collections. The change for inventory was driven by decreased business activity.
Income tax expense The Company recorded income tax expense of $28.3 million in 2024 compared to an income tax benefit of $8.4 million in 2023. The Company’s effective tax rate was 8.8% in 2024 compared to an effective tax rate of (4.9)% in 2023.
Income tax expense The Company recorded income tax expense of $18.0 million in 2025 compared to income tax expense of $28.3 million in 2024. The Company’s effective tax rate was 7.1% in 2025 compared to an effective tax rate of 8.8% in 2024.
Recently issued accounting pronouncements Refer to Note 1 of the Company’s consolidated financial statements for a discussion of accounting pronouncements recently issued but not yet adopted. Non-GAAP Information The Company’s consolidated financial statements are prepared in conformity with GAAP.
New Accounting Pronouncements Recently adopted accounting pronouncements Refer to Note 1 to the Company’s consolidated financial statements for a discussion of accounting pronouncements implemented in 2025. Recently issued accounting pronouncements Refer to Note 1 of the Company’s consolidated financial statements for a discussion of accounting pronouncements recently issued but not yet adopted.
For example, we have the capabilities and core competencies to develop and co-optimize offerings solving customers’ complex manufacturing challenges across the deposition, CMP process and post-CMP modules, with solutions including advanced deposition materials, CMP slurries, pads and post-CMP cleaning chemistries (each from our MS segment), and CMP slurry filters, high-purity packaging and fluid monitoring systems (each from our APS segment).
We address complex manufacturing challenges across deposition, CMP and post-CMP modules with solutions including advanced deposition materials, CMP slurries, pads and post-CMP cleaning chemistries (each from our MS segment), and CMP slurry filters, high-purity packaging and fluid monitoring systems (each from our APS segment).
Sales percentage on a geographic basis for 2024 and 2023 and the percentage increase (decrease) in sales for 2024 compared to sales for 2023 were as follows: Year ended December 31, 2024 December 31, 2023 Percentage increase (decrease) in sales North America 21 % 25 % (25) % Taiwan 20 % 17 % 12 % China 21 % 16 % 18 % South Korea 13 % 13 % (6) % Japan 10 % 10 % (16) % Europe 8 % 11 % (32) % Southeast Asia 7 % 7 % (12) % The decrease in sales to customers in North America primarily relate to the absence of sales from divested businesses.
Sales percentage on a geographic basis for 2025 and 2024 and the percentage increase (decrease) in sales for 2025 compared to sales for 2024 were as follows: Year ended December 31, 2025 December 31, 2024 Percentage increase (decrease) in sales North America 18 % 21 % (16) % Taiwan 23 % 20 % 11 % China 21 % 21 % (2) % South Korea 13 % 13 % 2 % Japan 10 % 10 % 3 % Europe 7 % 8 % (13) % Southeast Asia 8 % 7 % 10 % 37 Table of Contents The decrease in sales to customers in North America primarily relates to the absence of sales from the divested PIM business and from decreased demand for our MS and APS products.
An analysis of the factors underlying the increase in ER&D expenses is presented in the following table: (In thousands) Engineering, research and development expense in 2023 $ 277,313 Employee costs 14,874 Project related costs 11,411 Depreciation expense 8,013 Other increases, net 4,500 Engineering, research and development expense in 2024 $ 316,111 The Company’s overall ER&D efforts will continue to focus on developing and improving its technology platforms to support the semiconductor ecosystem and identifying and developing products for new applications.
An analysis of the factors underlying the increase in ER&D expenses is presented in the following table: (In millionss) Engineering, research and development expense in 2024 $ 316.1 Depreciation expense 4.7 Project related costs 4.0 Restructuring costs, see Note 15 to the Company’s consolidated financial statements 3.1 Other increases, net 1.1 Engineering, research and development expense in 2025 $ 329.0 The Company’s overall ER&D efforts will continue to focus on developing and improving its technology platforms to support the semiconductor ecosystem and identifying and developing products for new applications.
Management’s utilization of different judgments or estimates could result in material differences in the amount and timing of the Company’s results of operations for any period.
Management’s utilization of different judgments or estimates could result in material differences in the amount and timing of the Company’s results of operations for any period. In addition, actual results could be different from the Company’s current estimates, possibly resulting in increased future charges to earnings.
Gross margin The following table sets forth gross margin as a percentage of net sales: 2024 2023 Percentage point change Gross margin as a percentage of net sales: 45.9 % 42.5 % 3.4 Gross margin increased by 3.4% for 2024 compared to 2023. Gross margin increased primarily due to the positive impact of the divested businesses and improved plant performance.
Gross margin The following table sets forth gross margin as a percentage of net sales: 2025 2024 Percentage point change Gross margin as a percentage of net sales: 44.4 % 45.9 % (1.5) Gross margin decreased by 1.5% for 2025 compared to 2024. Gross margin decreased primarily due to plant performance and higher depreciation expense.
The sales decrease was driven primarily by the absence of $434.2 million in sales associated with divested businesses included in the prior year sales, partially offset by increased sales from CMP consumables, advanced deposition materials and selective etching products. MS reported a segment profit of $286.2 million for 2024, down 3% compared to $296.4 million in 2023.
The sales increase was driven by increased sales from CMP consumables, selective etch and deposition materials, partially offset by the absence of $33.9 million in prior-year sales from the divested PIM business and decreased sales from advanced materials products. MS reported a segment profit of $276.6 million for 2025, down 3% compared to $286.2 million in 2024.
Interest income Interest income was $7.4 million in 2024 and $11.3 million in 2023. The decrease primarily reflects lower average cash balances. Other expense, net Other expense, net, was $4.0 million in 2024 compared to $25.4 million in 2023.
Interest income Interest income was $7.9 million in 2025 and $7.3 million in 2024. The increase primarily reflects higher average cash balances at our foreign subsidiaries. Other expense, net Other expense, net, was $9.4 million in 2025 compared to $4.0 million in 2024.
The decrease in sales to customers in Japan primarily relates to decreased demand for our APS products, partially offset by increased demand for our MS products. The decrease in sales to customers in Europe primarily relate to the absence of sales from divested businesses.
The increase in sales to customers in South Korea primarily relates to increased demand for our MS and APS products. The increase in sales to customers in Japan primarily relates to increased demand for our MS products, partially offset by decreased demand for our APS products.
In summary, our cash flows for each period were as follows: (In thousands) Year ended December 31, 2024 Year ended December 31, 2023 Net cash provided by operating activities $ 631,721 $ 644,476 Net cash (used in) provided by investing activities (67,079) 553,071 Net cash used in financing activities (688,987) (1,297,543) Decrease in cash, cash equivalents and restricted cash (127,716) (106,510) Operating activities Cash provided by operating activities is net income adjusted for certain non-cash items and changes in assets and liabilities.
In summary, our cash flows for each period were as follows: (In millions) Year ended December 31, 2025 Year ended December 31, 2024 Net cash provided by operating activities $ 695.4 $ 631.7 Net cash used in investing activities (300.8) (67.1) Net cash used in financing activities (366.9) (688.9) Increase (decrease) in cash and cash equivalents 31.2 (127.7) Operating activities Cash provided by operating activities is net income adjusted for certain non-cash items and changes in assets and liabilities.
The presentation of non-GAAP financial measures is not meant to be considered in isolation, as a substitute for, or superior to, financial measures or information provided in accordance with GAAP.
The presentation of non-GAAP financial measures is not meant to be considered in isolation, as a substitute for, or superior to, financial measures or information provided in accordance with GAAP. Management strongly encourages investors to review the Company’s consolidated financial statements in their entirety and to not rely on any single financial measure.
These expenses were $316.1 million in 2024 and $277.3 million in 2023.
These expenses were $329.0 million in 2025 and $316.1 million in 2024.
The change for accounts payable and accrued liabilities was driven by timing of payments. Investing activities I nvesting cash flows consist primarily of capital expenditures, cash used for acquisitions, proceeds from sales of businesses and proceeds from sales of property and equipment.
The change in income tax payable and refundable incomes taxes is primarily due to higher income tax payments. Investing activities I nvesting cash flows consist primarily of capital expenditures, cash used for acquisitions, proceeds and payments from sales of businesses and proceeds from sales of property and equipment.
Management uses judgment to determine whether to use a qualitative analysis or a quantitative fair value measurement for its goodwill impairment testing. The Company's fair value measurement approach combines the income and market valuation techniques for each of the Company’s reporting units that carry goodwill.
The Company's fair value measurement approach combines the income and market valuation techniques for each of the Company’s reporting units that carry goodwill.
Year ended (In thousands) December 31, 2024 December 31, 2023 Percent change Adjusted Operating Income $ 742,954 $ 769,672 (3.5) % Adjusted Operating Margin - as a % of net sales 22.9 % 21.8 % Adjusted EBITDA $ 931,074 $ 942,355 (1.2) % Adjusted EBITDA - as a % of net sales 28.7 % 26.7 % Non-GAAP EPS $ 3.00 $ 2.64 13.6 % The decreases in Adjusted Operating Income and Adjusted EBITDA in 2024 compared to 2023 are generally attributable to decreased net sales and gross profit due to divested businesses and higher operating expenses.
Year ended (In millions) December 31, 2025 December 31, 2024 Percent change Adjusted Operating Income $ 680.9 $ 743.0 (8.4) % Adjusted Operating Margin - as a % of net sales 21.3 % 22.9 % Adjusted EBITDA $ 886.2 $ 931.1 (4.8) % Adjusted EBITDA - as a % of net sales 27.7 % 28.7 % Non-GAAP EPS $ 2.75 $ 3.00 (8.3) % The decreases in Adjusted Operating Income and Adjusted EBITDA in 2025 compared to 2024 are generally attributable to decreased gross profit and the absence of segment profit associated with the divested PIM business.
Interest projections on both variable and fixed rate long-term debt are based on interest rates effective as of December 31, 2024 and do not include $63.9 million for net unamortized discounts and debt issuance costs.
Interest projections on both variable and fixed rate long-term debt are based on interest rates effective as of December 31, 2025 and do not include $47.4 million for unamortized discounts and debt issuance costs. Capital purchase obligations . We have capital purchase obligations that represent commitments for the construction or purchase of property, plant and equipment.
They were not recorded as liabilities on the Company’s consolidated balance sheet as of December 31, 2024, as the Company had not yet received the related goods or taken title to the property.
They were not recorded as liabilities on the Company’s consolidated balance sheet as of December 31, 2025, as the Company had not yet received the related goods or taken title to the property. We expect capital expenditure spending to be approximately $250.0 million in 2026. 42 Table of Contents Supply purchase obligations .
Non-GAAP EPS is defined as Non-GAAP Net Income divided by our diluted weighted-average shares outstanding. The Company provides supplemental non-GAAP financial measures to help management and investors to better understand its business and believes these measures provide investors and analysts additional and meaningful information for the assessment of the Company’s ongoing results.
The Company provides supplemental non-GAAP financial measures to help management and investors to better understand its business and believes these measures provide investors and analysts additional and meaningful information for the assessment of the Company’s ongoing results. Management also uses these non-GAAP measures to assist in the evaluation of the performance of its business segments and to make operating decisions.
Accordingly, the methodology used to produce the Company’s non-GAAP financial measures is not computed under GAAP and may differ notably from the methodology used by other companies. For example, the Company’s non-GAAP measure of Adjusted EBITDA may not be directly comparable to EBITDA or an Adjusted EBITDA measure reported by other companies.
For example, the Company’s non-GAAP measure of Adjusted EBITDA may not be directly comparable to EBITDA or an Adjusted EBITDA measure reported by other companies. Second, the Company’s non-GAAP financial measures exclude items such as amortization and depreciation that are recurring.
The decrease in sales to customers in Southeast Asia primarily relates to the absence of sales from divested businesses, partially offset by increased demand for our MS products.
The decrease in sales to customers in Europe primarily relates to decreased demand for our MS and APS products. The increase in sales to customers in Southeast Asia primarily relates to increased demand for our MS and APS products.
Income tax liabilities . Of the tax liabilities included in the table above, $44.3 million relates to uncertain tax positions. We are unable to accurately predict when these amounts will be realized or released.
Commitments under operating and financing leases primarily relate to leasehold properties. See Note 13 of the consolidated financials for additional information. Income tax liabilities . Of the tax liabilities included in the table above, $33.7 million relates to uncertain tax positions. We are unable to accurately predict when these amounts will be realized or released.
Through December 31, 2024, the Company was in compliance with all applicable financial covenants included in the terms of its debt arrangements. The Company has commitments under the Revolving Facility of $575.0 million.
During the fiscal year 2025, the Company repaid $300.0 million net of borrowings under the senior secured term loan. Through December 31, 2025, the Company was in compliance with all applicable financial covenants included in the terms of its debt arrangements.
An analysis of the factors underlying the decrease in net sales is presented in the following table: 37 Table of Contents (In thousands) Net sales in 2023 $ 3,523,926 Decrease associated with divestitures (434,241) Decrease associated with effect of foreign currency translation (23,400) Increase mainly associated with volume 174,923 Net sales in 2024 $ 3,241,208 As described in the table above, the decrease in net sales was primarily attributable to (i) the absence of sales totaling $434.2 million associated with divested businesses and (ii) a reduction of $23.4 million attributable to unfavorable foreign currency translation effects, primarily related to the weakening of the Japanese yen relative to the U.S. dollar compared to the year ago period ended December 31, 2023.
An analysis of the factors underlying the decrease in net sales is presented in the following table: (In millions) Net sales in 2024 $ 3,241.2 Decrease associated with divestiture (33.9) Decrease mainly associated with volume (14.2) Increase associated with effect of foreign currency translation 3.5 Net sales in 2025 $ 3,196.6 As described in the table above, the decrease in net sales was primarily attributable to (i) the absence of $33.9 million in sales associated with the divested PIM business and (ii) a reduction of $14.2 million of sales mainly due to decreased semiconductor market demand compared to the year ago period ended December 31, 2024.
The effective interest rate after consideration of this floating-to-fixed swap contract was 4.71%. Refer to Note 12 for a description of our interest rate swap contract. (2) Our senior secured revolving credit facility due 2027 (the “Revolving Facility”) bears interest at a rate per annum equal to SOFR, plus an applicable margin of 1.75%.
(2) Our senior secured revolving credit facility due 2027 (the “Revolving Facility”) bears interest at a rate per annum equal to SOFR, plus an applicable margin of 1.75%, or (ii) a base rate plus an appliable margin of 0.75%. The Revolving Facility has commitments of $575.0 million.
There were no outstanding borrowings under this line of credit and no balance was outstanding at December 31, 2024. 43 Table of Contents Cash and cash requirements (In thousands) December 31, 2024 December 31, 2023 Cash and cash equivalents $ 329,213 $ 456,929 U.S. 49,027 154,015 Non-U.S. 280,186 302,914 Our cash and cash equivalents include cash on hand and highly-liquid debt securities with original maturities of three months or less, which are valued at cost and approximate fair value.
Cash and cash requirements (In millions) December 31, 2025 December 31, 2024 Cash and cash equivalents $ 360.4 $ 329.2 U.S. 52.4 49.0 Non-U.S. 308.0 280.2 Our cash and cash equivalents include cash on hand and highly-liquid debt securities with original maturities of three months or less, which are valued at cost and approximate fair value.
An analysis of the factors underlying the decrease in SG&A expenses is presented in the following table: 38 Table of Contents (In thousands) Selling, general and administrative expenses in 2023 $ 576,194 Integration, deal and transaction costs, mainly due to CMC Materials acquisition (53,158) Loss on sales of EC and QED businesses in 2023 (23,839) Employee costs, mainly driven by divested businesses (17,991) Impairment on long-lived assets, see Note 3 to the Company’s Consolidated Financial Statements (17,497) Depreciation expense (7,919) Gain on sale of PIM business in 2024 (4,311) Other decreases, net (4,912) Selling, general and administrative expenses in 2024 $ 446,567 Engineering, research and development expenses Engineering, research and development (“ER&D”) expenses consist of expenses for the support of current product lines and the development of new products and manufacturing technologies.
An analysis of the factors underlying the increase in SG&A expenses is presented in the following table: (In millions) Selling, general and administrative expenses in 2024 $ 446.6 Restructuring costs, see Note 15 to the Company’s Consolidated Financial Statements 18.8 Loss on sale of divested business in 2025 10.9 Gain on sale of PIM business in 2024 4.3 Impairment on long-lived assets in 2024, see Note 3 to the Company’s Consolidated Financial Statements (13.0) Professional fees (9.7) Employee costs (excluding restructuring costs of $3.1 included in the line above) (3.9) Other decreases, net (3.4) Selling, general and administrative expenses in 2025 $ 450.6 Engineering, research and development expenses Engineering, research and development (“ER&D”) expenses consist of expenses for the support of current product lines and the development of new products and manufacturing technologies.
In addition, actual results could be different from the Company’s current estimates, possibly resulting in increased future charges to earnings. 36 Table of Contents Our critical accounting policies that are most significantly affected by estimates, assumptions and judgments used in the preparation of the Company's consolidated financial statements relate to business acquisitions and are discussed below.
Our critical accounting policies that are most significantly affected by estimates, assumptions and judgments used in the preparation of the Company's consolidated financial statements relate to business acquisitions and are discussed below. See Note 1 to the Company’s consolidated financial statements for additional information about the Company’s other significant accounting policies.
The $76.3 million decrease is primarily due to a $95.7 million decrease in deal, transaction and integration costs related to the acquisition of CMC Materials, partially offset by an increase in employee costs of $14.1 million. 41 Table of Contents Liquidity and Capital Resources We consider the following when assessing our liquidity and capital resources: (In thousands) December 31, 2024 December 31, 2023 Cash and cash equivalents $ 329,213 $ 456,929 Working capital 1,091,126 1,463,332 Total debt 3,981,105 4,577,141 The Company has historically financed its operations and capital requirements through cash flow from its operating activities, long-term loans, lease financing and borrowings under domestic and international short-term lines of credit.
Liquidity and Capital Resources We consider the following when assessing our liquidity and capital resources: (In millions) December 31, 2025 December 31, 2024 Cash and cash equivalents $ 360.4 $ 329.2 Working capital 1,149.6 1,091.1 Total debt 3,697.6 3,981.1 The Company has historically financed its operations and capital requirements through cash flow from its operating activities, long-term loans, lease financing and borrowings under domestic and international short-term lines of credit.
Capital expenditures in 2024 included spending related to our previously announced investment in our KSP site and new manufacturing facility in Colorado Springs, Colorado. 42 Table of Contents Financing activities Financing cash flows consist primarily of repurchases of common stock, payment of dividends to stockholders, issuance and repayment of short-term and long-term debt, and proceeds from the sale of shares of common stock through employee equity incentive plans.
Financing activities Financing cash flows consist primarily of payment of dividends to stockholders, issuance and repayment of short-term and long-term debt, and proceeds from the sale of shares of common stock through employee equity incentive plans. In 2025, there was $366.9 million of cash used in financing activities compared to $688.9 million cash used in financing activities in 2024.
The Company often works directly with its customers to address their needs. Amortization of intangible assets Amortization of intangible assets was $190.1 million in 2024 compared to $214.5 million for 2023.
The Company often works directly with its customers to address their needs. 38 Table of Contents Amortization of intangible assets Amortization of intangible assets was $184.4 million in 2025 compared to $190.1 million for 2024. The decrease primarily reflects the absence of amortization for certain identifiable intangible assets acquired in previous acquisitions that became fully amortized.
They were not recorded as liabilities on the Company’s consolidated balance sheet as of December 31, 2024, as the Company had not yet received the related goods or taken title to the property. Operating and financing lease commitments . Commitments under operating and financing leases primarily relate to leasehold properties. See Note 14 of the consolidated financials for additional information.
We have non-cancelable commitments, including take-or-pay contracts, that are not presented as capital purchase commitments above. They were not recorded as liabilities on the Company’s consolidated balance sheet as of December 31, 2025, as the Company had not yet received the related goods or taken title to the property. Operating and financing lease commitments .
Other Liquidity and Capital Resources Considerations Debt at par value outstanding (In thousands) December 31, 2024 December 31, 2023 Senior secured term loan due 2029 at 4.71% (1) $ 750,000 $ 1,373,774 Senior secured notes due 2029 at 4.75% 1,600,000 1,600,000 Senior unsecured notes due 2030 at 5.95% 895,000 895,000 Senior unsecured notes due 2029 at 3.625% 400,000 400,000 Senior unsecured notes due 2028 at 4.375% 400,000 400,000 Revolving facility due 2027 at 6.07% (2) — — Total debt (par value) $ 4,045,000 $ 4,668,774 (1) The Company entered into a floating-to-fixed swap contract on its variable rate debt under our senior secured term loan facility due 2029.
Other Liquidity and Capital Resources Considerations Debt at par value outstanding (In millions) December 31, 2025 December 31, 2024 Senior secured term loan due 2029 at 4.88% (1) $ 450.0 $ 750.0 Senior secured notes due 2029 at 4.75% 1,600.0 1,600.0 Senior unsecured notes due 2030 at 5.95% 895.0 895.0 Senior unsecured notes due 2029 at 3.625% 400.0 400.0 Senior unsecured notes due 2028 at 4.375% 400.0 400.0 Revolving facility due 2027 (2) — — Total debt (par value) $ 3,745.0 $ 4,045.0 41 Table of Contents (1) Our senior secured term loan due 2029 bears interest rate at a rate per annum equal to, at the Company’s option, either (i) SOFR, plus an applicable margin of 1.75%, or (ii) a base rate plus an applicable margin of 0.75%.
See Note 10 to the Company’s consolidated financial statements for further discussion of the debt financing that occurred during the year. The Company’s total dividend payments were $60.6 million in 2024 compared to $60.2 million in 2023. The Company has paid a cash dividend in each quarter since the fourth quarter of 2017.
The change in 2025 was primarily due to decreased net debt activity of $323.8 million compared to the prior year. The Company’s total dividend payments were $60.8 million in 2025 compared to $60.6 million in 2024. The Company has paid a cash dividend in each quarter since the fourth quarter of 2017.
The decrease was primarily associated with (1) the absence of a $184.8 million gain resulting from the termination of the alliance agreement with MacDermid Enthone in 2023, (2) the absence of segment profit associated with divested businesses, partially offset with (3) the absence of a goodwill impairment charge of $115.2 million, (4) the absence of $23.8 million loss on sale of business and held-for-sale in 2023, (5) a decrease of a $17.5 million of impairment charges related to the long-lived assets of a small, industrial specialty chemicals business in 2023, (6) a $4.3 million gain associated with sale of the PIM business, and (7) improved plant performance.
The decrease was primarily associated with (1) the net impact related to the divested PIM business of $14.5 million (2) loss on sale of small, industrial specialty chemicals business of $10.9 million and (3) lower plant performance, partially offset with (4) a decrease of a $13.0 million of impairment charges related to the long-lived assets of the aforementioned industrial specialty chemicals business in 2024 and (5) higher sales volume.
(Dollars in thousands) 2024 2023 % of net sales % of net sales Net sales $ 3,241,208 100.0 % $ 3,523,926 100.0 % Cost of sales 1,754,489 54.1 2,026,321 57.5 Gross profit 1,486,719 45.9 1,497,605 42.5 Selling, general and administrative expenses 446,567 13.8 576,194 16.4 Engineering, research and development expenses 316,111 9.8 277,313 7.9 Amortization of intangible assets 190,119 5.9 214,477 6.1 Goodwill impairment — — 115,217 3.3 Gain on termination of Alliance Agreement — — (184,754) (5.2) Operating income 533,922 16.5 499,158 14.2 Interest expense 215,217 6.6 312,378 8.9 Interest income (7,368) (0.2) (11,257) (0.3) Other expense, net 4,021 0.1 25,367 0.7 Income before income taxes 322,052 9.9 172,670 4.9 Income tax expense (benefit) 28,332 0.9 (8,413) (0.2) Equity in net loss of affiliates 933 — 414 — Net income $ 292,787 9.0 $ 180,669 5.1 Net sales For 2024, net sales were $3,241.2 million, decreased by $282.7 million, or 8%, from 2023.
(Dollars in millions) 2025 2024 % of net sales % of net sales Net sales $ 3,196.6 100.0 % $ 3,241.2 100.0 % Cost of sales 1,776.7 55.6 1,754.5 54.1 Gross profit 1,419.9 44.4 1,486.7 45.9 Selling, general and administrative expenses 450.6 14.1 446.6 13.8 Engineering, research and development expenses 329.0 10.3 316.1 9.8 Amortization of intangible assets 184.4 5.8 190.1 5.9 Operating income 455.9 14.3 533.9 16.5 Interest expense 199.8 6.3 215.2 6.6 Interest income (7.9) (0.2) (7.3) (0.2) Other expense, net 9.4 0.3 4.0 0.1 Income before income taxes 254.6 8.0 322.0 9.9 Income tax expense 18.0 0.6 28.3 0.9 Equity in net loss of affiliates 1.0 — 0.9 — Net income $ 235.6 7.4 $ 292.8 9.0 Net sales For 2025, net sales were $3,196.6 million, decreased by $44.6 million, or 1%, from 2024.
Results of Operations Year ended December 31, 2024 compared to year ended December 31, 2023 The following table sets forth the results of operations and the relationship between various components of operations, stated as a percent of net sales, for 2024 and 2023.
Adverse changes in the future could reduce the underlying cash flows used to estimate the reporting unit fair values and could result in a further decrease in fair value that could trigger a future impairment charge of the goodwill balance. 36 Table of Contents Results of Operations Year ended December 31, 2025 compared to year ended December 31, 2024 The following table sets forth the results of operations and the relationship between various components of operations, stated as a percent of net sales, for 2025 and 2024.
In 2023, other expense, net consisted mainly of loss of extinguishment and modification of debt of $29.9 million associated with the repayments on the Company’s bridge credit facility and senior secured term loan facility and the amendments of the 39 Table of Contents Company’s Existing Credit Agreement and foreign currency transaction losses of $5.7 million, partially offset by net proceeds received of $10.9 million resulting from the termination of the definitive agreement with Infineum related to the PIM business.
In 2025, other expense, net consisted mainly of loss of extinguishment of debt of $3.2 million associated with the repayments on the Company’s senior secured term loan facility (see Note 9 to the Company’s consolidated financial statements) and foreign currency transaction losses of $7.1 million.
(In thousands) 2024 2023 2022 Materials Solutions Net sales $ 1,400,082 $ 1,689,467 $ 1,380,208 Segment profit 286,220 296,375 219,189 Advanced Purity Solutions Net sales $ 1,850,199 $ 1,846,596 $ 1,913,985 Segment profit 496,131 531,448 595,213 Unallocated general and administrative expenses $ 58,310 $ 114,188 $ 190,468 Materials Solutions (MS) For 2024, MS net sales decreased to $1,400.1 million, down 17% from $1,689.5 million in 2023.
(In millions) 2025 2024 2023 Materials Solutions Net sales $ 1,406.7 $ 1,400.1 $ 1,689.5 Segment profit 276.6 286.2 296.4 Advanced Purity Solutions Net sales $ 1,799.1 $ 1,850.2 $ 1,846.6 Segment profit 426.4 496.1 531.4 Unallocated general and administrative expenses $ 62.7 $ 58.3 $ 114.1 Materials Solutions (MS) For 2025, MS net sales increased to $1,406.7 million, up from $1,400.1 million in 2024.
With our complementary capabilities, we believe we are uniquely positioned to create new, co-optimized and increasingly integrated solutions for our customers, which should translate into improved device performance, lower cost of ownership and faster time to market.
Our complementary capabilities enable co-optimized, integrated solutions that improve device performance, lower cost of ownership and accelerate time to market.
The increase in Non-GAAP EPS in 2024 compared to 2023 is primarily attributable to lower interest expense, partially offset by the decreases noted above for Adjusted Operating Income and Adjusted EBITDA. Segment Analysis In the fourth quarter of 2024, in order to align its segment financial reporting with a change in its business structure, the Company realigned its segments.
The decrease in Non-GAAP EPS in 2025 compared to 2024 is primarily attributable to decreased gross profit and the absence of segment profit associated with the divested PIM business, partially offset by lower interest expense. Segment Analysis The Company reports its financial performance based on two reportable segments.
Advanced Purity Solutions (APS) For 2024, APS net sales are approximately flat at $1,850.2 million, compared to $1,846.6 million in 2023. APS reported a segment profit of $496.1 million for 2024, down 7% compared to $531.4 million in 2023.
Advanced Purity Solutions (APS) For 2025, APS net sales decreased to $1,799.1 million, down 3% $1,850.2 million in 2024.
The following table summarizes our short and long-term cash requirements as of December 31, 2024: (In thousands) Total Due within one year of December 31, 2024 Due later than one year from December 31, 2024 Long-term debt (principal) $ 4,045,000 $ — $ 4,045,000 Interest payments on long-term debt 924,114 198,168 725,946 Capital purchase obligations 125,645 67,761 57,884 Supply purchase obligations 60,030 29,134 30,896 Operating and financing leases 108,174 20,012 88,162 Income tax liabilities 150,722 80,532 70,190 Total $ 5,413,685 $ 395,607 $ 5,018,078 Long-term debt and interest payments on long-term debt .
The following table summarizes our short and long-term cash requirements as of December 31, 2025: (In millions) Total Due within one year of December 31, 2025 Due later than one year from December 31, 2025 Long-term debt (principal) $ 3,745.0 $ — $ 3,745.0 Interest payments on long-term debt 655.3 184.5 470.8 Capital purchase obligations 60.0 42.5 17.5 Supply purchase obligations 150.5 88.1 62.4 Operating and financing leases 151.3 21.6 129.7 Income tax liabilities 123.2 82.4 40.8 Total $ 4,885.3 $ 419.1 $ 4,466.2 Long-term debt and interest payments on long-term debt .
Management strongly encourages investors to review the Company’s consolidated financial statements in their entirety and to not rely on any single financial measure. 45 Table of Contents Management notes that the use of non-GAAP measures has limitations, including but not limited to: First, non-GAAP financial measures are not standardized.
Management notes that the use of non-GAAP measures has limitations, including but not limited to: First, non-GAAP financial measures are not standardized. Accordingly, the methodology used to produce the Company’s non-GAAP financial measures is not computed under GAAP and may differ notably from the methodology used by other companies.
Adjusted EBITDA is defined by the Company as net income before, as applicable, (1) equity in net loss of affiliates, (2) income tax expense (benefit), (3) interest expense, (4) interest income, (5) other expense, net, (6) goodwill impairment, (7) deal and transaction costs, (8) integration costs, (9) restructuring costs, (10) acquired tax equalization asset reduction, (11) (gain) loss on sale of businesses and held-for-sale assets, net, (12) gain on termination of the alliance agreement, (13) impairment of long-lived assets, (14) amortization of intangible assets, and (15) depreciation.
Adjusted EBITDA is defined by the Company as net income adjusted to exclude (1) equity in net loss of affiliates, (2) income tax expense, (3) interest expense, (4) interest income, (5) other expense, net, (6) depreciation, and (7) the impact of any Special Items.
The decrease in 2024 resulted primarily from less proceeds from divestitures of $564.2 million and the absence of net proceeds from the termination of the alliance agreement of $191.2 million, partially offset by a $141.2 million decrease in capital expenditures compared to the prior year.
Net cash used in investing activities was $300.8 million in 2025 compared to net cash provided by investing activities $67.1 million cash used in investing activities in 2024, primarily reflecting lower proceeds from divestitures of $257.5 million, partially offset by a $16.4 million decrease in capital expenditures and $8.2 million of proceeds from government incentives.
These declines were partially offset by an increase of $174.9 million of sales due to increased semiconductor market demand compared to the year ago period ended December 31, 2023.
These sales were partially offset by an increase of $3.5 million of sales attributable to favorable foreign currency translation effects, primarily related to the strengthening of the Taiwanese dollar, Japanese yen and euro relative to the U.S. dollar compared to the year ago period ended December 31, 2024.
The decrease in APS’s profit in 2023 was primarily due to lower sales, lower factory performance, increased costs associated with our new manufacturing facility in Taiwan and increased investment in research and development. Unallocated general and administrative expenses Unallocated general and administrative expenses for 2024 totaled $58.3 million compared to $114.2 million for 2023.
Unallocated general and administrative expenses Unallocated general and administrative expenses for 2025 totaled $62.7 million compared to $58.3 million for 2024. The $4.4 million increase is primarily due to an increase in employee costs.
The sales decrease was primarily due to lower sales from our microenvironment solutions products, partially offset by improved sales from our liquid filtration products. APS reported a segment profit of $531.4 million for 2023, down 11% compared to $595.2 million in 2022.
APS reported a segment profit of $426.4 million for 2025, down 14% compared to $496.1 million in 2024. The decrease in APS’s profit in 2025 was primarily due to lower sales, unfavorable plant performance, higher depreciation expense and higher restructuring costs of $21.9 million.
Removed
We leverage our unique breadth of capabilities to help our customers improve their productivity, product performance and technology in the most advanced manufacturing environments. 35 Table of Contents In the fourth quarter of 2024, the Company announced an internal reorganization, combining two complementary divisions into one and realigning its customer facing organization.
Added
As leading semiconductor manufacturers implement molybdenum into advanced nodes, Entegris is uniquely positioned to support this transition and to solve challenges associated with integrating a new material through our expertise and solutions in precursors, deposition, etch, CMP consumables and contamination control.
Removed
Our business is now organized and operated in two operating segments as discussed below. The current annual and succeeding annual periods will disclose the reportable segments with prior periods recast to reflect the change.
Added
Global Trade Environment Recent and continuing developments in U.S. and foreign trade policy have heightened global trade tensions and sparked significant uncertainty in macroeconomic and geopolitical environments, particularly with respect to China. The nature of our global business exposes us to risks associated with trade conflicts between the U.S. and its trading partners.
Removed
Regulatory Volatility In light of the current geopolitical environment, in the near term, we anticipate greater uncertainty and inconsistency among the jurisdictions in which we operate with respect to policies and regulations that affect our business, including, without limitation, trade regulations, environmental regulations, labor and immigration regulations, tax policies, tariffs, sanctions and export controls.
Added
Additionally, our manufacturing operations rely on a global supply chain to manufacture our products, including, in some instances, raw materials from China. The recent tariffs and other similar trade policies may increase our sourcing and manufacturing costs, force us to find alternative suppliers, or result in manufacturing and delivery delays.
Removed
This may add additional uncertainty and volatility to business planning and forecasting for us and for our customers.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeFinancial results therefore will be affected by changes in currency exchange rates. If all foreign currencies were to see a 10% reduction versus the U.S. dollar during the years ended December 31, 2024 and 2023, revenue would be negatively impacted by approximately $53.2 million and $76.8 million, respectively.
Biggest changeFinancial results therefore will be affected by changes in currency 46 Table of Contents exchange rates. If all foreign currencies were to see a 10% reduction versus the U.S. dollar during the years ended December 31, 2025 and 2024, revenue would be negatively impacted by approximately $55.9 million and $53.2 million, respectively.
The Company occasionally uses derivative financial instruments to manage the foreign currency exchange rate risks associated with its foreign-based operations. However, we are unlikely to be able to hedge these exposures completely. We do not enter into forward contracts or other derivative instruments for speculative or trading purposes. See Note 12 of the consolidated financials for additional information.
The Company occasionally uses derivative financial instruments to manage the foreign currency exchange rate risks associated with its foreign-based operations. However, we are unlikely to be able to hedge these exposures completely. We do not enter into forward contracts or other derivative instruments for speculative or trading purposes. See Note 11 of the consolidated financials for additional information.
The Company’s cash and cash equivalents include cash on hand and highly-liquid debt securities with original maturities of three months or less. A 100-basis point change in interest rates would potentially increase or decrease annual net income by approximately $2.5 million and $3.4 million for the years ended December 31, 2024 and 2023, respectively.
The Company’s cash and cash equivalents include cash on hand and highly-liquid debt securities with original maturities of three months or less. A 100-basis point change in interest rates would potentially increase or decrease annual net income by approximately $0.7 million and $2.5 million for the years ended December 31, 2025 and 2024, respectively.
The cash flows and results of operations of the Company’s foreign-based operations are subject to fluctuations in foreign currency exchange rates. Approximately 16.7% and 22.0% of the Company’s sales during 2024 and 2023 were collectively denominated in the South Korean won, New Taiwan dollar, Chinese renminbi, Canadian dollar, Malaysian ringgit, Singapore dollar, euro, Israeli shekel and the Japanese yen.
The cash flows and results of operations of the Company’s foreign-based operations are subject to fluctuations in foreign currency exchange rates. Approximately 17.5% and 16.7% of the Company’s sales during 2025 and 2024, respectively, were collectively denominated in the South Korean won, New Taiwan dollar, Chinese renminbi, Canadian dollar, Malaysian ringgit, Singapore dollar, euro, Israeli shekel and the Japanese yen.
Removed
On July 28, 2022, the Company entered into a floating-to-fixed interest rate swap agreement to hedge the variability in SOFR-based interest payments associated with $1.95 billion of its $2.495 billion Initial Term Loan Facility. The notional amount of the swap is $750.0 million at December 31, 2024 and is scheduled to decrease quarterly and will expire on December 30, 2025.

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