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

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Paragraph-level year-over-year comparison of WESCO INTERNATIONAL 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.

+335 added−323 removedSource: 10-K (2026-02-13) vs 10-K (2025-02-14)

Top changes in WESCO INTERNATIONAL INC's 2025 10-K

335 paragraphs added · 323 removed · 230 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

62 edited+5 added−11 removed64 unchanged
Biggest changeWesco Cares is our corporate philanthropy program focused on affordable housing, humanitarian aid, and science, technology, engineering and mathematics (“STEM”), and provides for corporate charitable donations, employee volunteerism, and employee gift-matching. Employees are encouraged to volunteer in their communities on June 22nd as part of Wesco’s global annual day of caring. Environmental Management Environmental sustainability is a priority for Wesco.
Biggest changeBy connecting with and contributing to local charitable organizations, Wesco supports the development of strong, vibrant and diverse communities. Wesco Cares is our corporate philanthropy program focused on affordable housing, humanitarian aid, and science, technology, engineering and mathematics education, and provides for corporate charitable donations, employee volunteerism, employee assistance grants and employee gift-matching.
In addition, the charters for our Audit, Compensation, Executive and Nominating and Governance committees, as well as our Corporate Governance Guidelines, Code of Principles for Senior Executives, Independence Policy, Global Antibribery and Anticorruption Policy, and Code of Business Conduct for our Directors, officers and employees, are all available on our website at the “Leadership” link under the “Our Company” heading. 8 Table of Contents Forward-Looking Information This Annual Report on Form 10-K contains various “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.
In addition, the charters for our Audit, Compensation, Executive, and Nominating and Governance committees, as well as our Corporate Governance Guidelines, Code of Principles for Senior Financial Executives, Independence Policy, Global Antibribery and Anticorruption Policy, and Code of Business Conduct for our Directors, officers and employees, are all available on our website at the “Leadership” link under the “Our Company” heading. 8 Table of Contents Forward-Looking Information This Annual Report on Form 10-K contains various “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.
Investor-owned utility companies provide a combination of electric generation, transmission and/or distribution and are owned by investors or shareholders while public power entities are generally non-profit entities owned by their members or governed by local, state, or municipal governments. These two businesses comprise the vast majority of utility customers in the U.S. and Canada.
Investor owned utility companies provide a combination of electric generation, transmission and/or distribution and are owned by investors or shareholders. Public power entities are generally non-profit entities owned by their members or governed by local, state, or municipal governments. These two businesses comprise the vast majority of our utility customers in the U.S. and Canada.
Wesco annually surveys employees to assess their engagement, as well as to solicit feedback and ideas on organizational changes, so senior management may more intelligently adjust to our employees’ evolving needs and support employee success. Wesco also promotes employee engagement through regular town hall discussions. Community.
Wesco regularly surveys employees to assess their engagement, as well as to solicit feedback and ideas on organizational changes, so senior management may more intelligently adjust to our employees’ evolving needs and support employee success. Wesco also promotes employee engagement through regular town hall discussions. Community.
Safety is the first tenet of our core value of commitment to our people and we do not tolerate violations of established safety protocol. We work to reduce or eliminate health and safety risks through dedicated programs, leadership commitment, and employee best practice sharing and training.
Safety is the first tenet of our core value of commitment to our people and we do not tolerate violations of established safety protocol. We work to reduce or eliminate health and safety risks through dedicated preventative and reactionary programs, leadership commitment, and employee best practice sharing and training.
Lazzaris served as Senior Vice President - Legal, General Counsel and Corporate Secretary of Dick’s Sporting Goods, Inc. From 1994 to 2008, she held various corporate counsel positions at Alcoa Inc., including Group Counsel to a group of global businesses.
Lazzaris served as Senior Vice President - Legal, General Counsel and Corporate Secretary of Dick’s Sporting Goods, Inc. From 1994 to 2008, she held various corporate counsel positions at Alcoa Inc., including Group Counsel to a group of global businesses. Dirk W.
The products sold include wire and cable, transformers, transmission and distribution hardware, switches, protective devices, connectors, lighting, conduit, fiber and copper cable, connectivity products, pole line hardware, racks, cabinets, safety and MRO products, and point-to-point wireless devices.
The products sold include wire and cable, transformers, transmission and distribution hardware, switches, protective devices, connectors, lighting, conduit, fiber and power cable, connectivity products, pole line hardware, racks, cabinets, safety and MRO products, and point-to-point wireless devices.
Our main source of direct and indirect GHG emissions from our own activities is attributed to the power and natural gas used by our facilities, which accounts for approximately 70% of total emissions from our own activities.
Our main source of direct and indirect GHG emissions from our own activities is attributed to the electricity and natural gas used by our facilities, which accounts for approximately 70% of total emissions from our own activities.
(“Wesco International”) and its subsidiaries (collectively, “Wesco” or the “Company”), headquartered in Pittsburgh, Pennsylvania, is a leading provider of business-to-business distribution, logistics services and supply chain solutions. We employ approximately 20,000 people, maintain relationships with more than 35,000 suppliers, and serve nearly 140,000 customers worldwide.
(“Wesco International”) and its subsidiaries (collectively, “Wesco” or the “Company”), headquartered in Pittsburgh, Pennsylvania, is a leading provider of business-to-business distribution, logistics services and supply chain solutions. We employ approximately 21,000 people, maintain relationships with more than 35,000 suppliers, and serve nearly 130,000 customers worldwide.
No single customer accounted for more than 4% of our sales in 2024. Suppliers Our global network of distribution centers, fulfillment centers, and sales offices provide customers with access to millions of products. Specific locations tailor their inventories to meet the needs of their customers, providing a local presence and a global network to service multi-location businesses and global corporations.
No single customer accounted for more than 5% of our sales in 2025. Suppliers Our global network of distribution centers, fulfillment centers and sales offices provide customers with access to millions of products. Specific locations tailor their inventories to meet the needs of their customers, providing a local presence and a global network to service multi-location businesses and global corporations.
We seek to achieve continuous improvement in the safety of our facilities and track a series of metrics that provide guidance toward that improvement. 5 Table of Contents Our Global Corporate Safety team oversees our health and safety program, which covers the core processes and procedures for strong health and safety management, safe work practices, and regulatory compliance.
We seek to achieve continuous improvement in the safety of our facilities and track a series of metrics that provide guidance toward that improvement. Our Global Corporate Safety team oversees our health and safety program, which covers the core processes and procedures for health and safety management, safe work practices, and regulatory compliance.
The EES segment operates in highly fragmented markets that include thousands of small, regional and locally based privately owned competitors, as well as several large, multi-national companies. 1 Table of Contents Communications & Security Solutions The CSS segment, with approximately 4,700 employees serving customers in over 50 countries, is a global leader in data center, network infrastructure and security solutions.
The EES segment operates in highly fragmented markets that include thousands of small, regional and locally based privately owned competitors, as well as several large, multi-national companies. 1 Table of Contents Communications & Security Solutions The CSS segment, serving customers in over 50 countries, is a global leader in data center, network infrastructure and security solutions.
Cameron served as Senior Vice President of the Utility Group, and Vice President of Marketing & Operations with Irby, a Sonepar Company. Earlier in his career, Mr. Cameron held various positions with Hubbell Power Systems, Thomas & Betts and the ABB Power T&D Company. 9 Table of Contents William C.
Cameron served as Senior Vice President of the Utility Group, and Vice President of Marketing & Operations with Irby, a Sonepar Company. Earlier in his career, Mr. Cameron held various positions with Hubbell Power Systems, Thomas & Betts and the ABB Power T&D Company. 9 Table of Contents Daniel J.
In 2024, our ten largest suppliers accounted for approximately 30% of our purchases. No single supplier accounted for more than 6% of our total purchases. Our supplier relationships are important to us, providing access to a wide range of products, services, technical training, and sales and marketing support.
In 2025, our ten largest suppliers accounted for approximately 32% of our purchases. No single supplier accounted for more than 6% of our total purchases. Our supplier relationships are important to us, providing access to a wide range of products, services, technical training, and sales and marketing support.
We have undertaken no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Executive Officers Our executive officers and their respective ages and positions as of February 14, 2025 are set forth below. Name Age Position John J. Engel 63 Chairman, President and Chief Executive Officer David S.
We have undertaken no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Executive Officers Our executive officers and their respective ages and positions as of February 13, 2026 are set forth below. Name Age Position John J. Engel 64 Chairman, President and Chief Executive Officer David S.
Our global distribution network includes 59 facilities that operate as regional distribution centers or large fulfillment centers in key geographic areas in North America, Europe and South America. These facilities add value for our customers and suppliers through the combination of inventory selection, online ordering, shipment capabilities, and order handling and fulfillment.
Our global distribution network includes facilities that operate as large distribution centers or fulfillment centers in key geographic areas in North America, Europe, South America and the Asia Pacific region. These facilities add value for our customers and suppliers through the combination of inventory selection, online ordering, shipment capabilities, and order handling and fulfillment.
These include, among others: • Advisory services to help our partners and customers with advanced solutions that leverage the industry’s leading technologies, optimize supply chains, implement Lean practices, improve safety and digitally transform workplaces; • Installation enhancement services to adapt products and packaging in order to streamline processes and reduce the total cost of installation; • Project deployment services to help secure job site materials, prevent loss, improve efficiency, reduce job site waste, ensure day-to-day supplies are on hand and improve scalability across global deployments; • Supply chain programs to improve productivity, reduce operating costs and increase operational efficiencies; and • Digital services and e-business integrations to transform how our customers consume, deploy, and procure materials and technologies, supporting data-driven decisions and increased operational efficiency.
These include, among others: • Advisory services to help our partners and customers with advanced solutions that leverage the industry’s leading technologies, optimize supply chains, implement Lean practices, improve safety and digitally transform workplaces; • Installation enhancement services to adapt products and packaging in order to streamline processes and reduce the total cost of installation; • Project deployment services to help secure job site materials, prevent loss, improve efficiency, reduce job site waste, ensure day-to-day supplies are on hand and improve scalability across global deployments; • Supply chain management programs to improve productivity, reduce operating costs and increase operational efficiencies; • Digital products, services and e-business integrations to transform how our customers consume, deploy, and procure materials and technologies, supporting data-driven decisions and increased operational efficiency; and • Data center services and solutions to ensure the efficiency and reliability of facilities throughout every phase of the data center lifecycle from construction to operation.
Information contained in the Sustainability Report is not part of, and should not be construed as being incorporated by reference into, this Annual Report on Form 10-K. We are working to reduce our environmental impact in the following areas: Energy.
Refer to our Sustainability Report for updates on our sustainability efforts and goals. Information contained in the Sustainability Report is not part of, and should not be construed as being incorporated by reference into, this Annual Report on Form 10-K. We are working to reduce our environmental impact in the following areas: Energy.
Electrical & Electronic Solutions The EES segment, with approximately 6,700 employees serving customers in over 50 countries, is a North American leader, and supplies a broad range of products and solutions primarily to construction, industrial and original equipment manufacturer (“OEM”) customers.
Electrical & Electronic Solutions The EES segment, serving customers in over 50 countries, is a North American leader, and supplies a broad range of products and solutions primarily to construction, industrial and original equipment manufacturer (“OEM”) customers.
Our BRGs engage in various activities, such as: • Building an inclusive culture, positively impacting employee engagement and creating an open forum for the exchange of ideas; • Providing informal mentoring for employees; • Identifying opportunities for adding value and growing Wesco’s business through community engagement; and • Engaging with suppliers, customers and industry groups to share best practices, advance the industry, and drive business growth.
Our BRGs engage in various activities, such as: • Building an inclusive culture, positively impacting employee engagement and creating an open forum for the exchange of ideas; • Providing professional development opportunities for employees; • Identifying opportunities for adding value and growing Wesco’s business through community engagement; and • Engaging with suppliers, customers and industry groups to share best practices, advance the industry, and drive business growth. 6 Table of Contents Company Ethics.
We have commercial agreements with more than 470 preferred suppliers and purchase approximately 66% of our products pursuant to these arrangements. We offer a wide range of sustainable products from the world’s leading manufacturers and help our customers determine solutions to meet their sustainability goals.
We have commercial agreements with more than 450 preferred suppliers and approximately 68% of our purchases are made pursuant to these arrangements. We offer a wide range of sustainable products from the world’s leading manufacturers and help our customers determine solutions to meet their sustainability goals.
Our dedicated technical experts have extensive experience and product and services knowledge that enable them to provide solutions tailored to the various needs of our customers. With specialized industry knowledge and a focus on the leading technologies, we help design and deploy solutions that address critical business priorities. Uniquely Positioned to Benefit from Secular Trends .
Our customers have unique business models, challenges and priorities. Our dedicated technical experts have extensive experience and product and services knowledge that enable them to provide solutions tailored to the various needs of our customers. With specialized industry knowledge and a focus on the leading technologies, we help design and deploy solutions that address critical business priorities.
It prohibits discrimination, harassment, and child and forced labor. It also provides guidance on appropriate working hours, wages and benefits, and safe and healthy workplace conditions. As of December 31, 2024, Wesco had approximately 20,000 full-time employees worldwide, with approximately 13,000 in the U.S. and the remaining 7,000 in international locations. Safety.
It prohibits discrimination, harassment, and child and forced labor. It also provides guidance on appropriate working hours, wages and benefits, and safe and healthy workplace conditions. As of December 31, 2025, Wesco had approximately 21,000 full-time employees worldwide, with more than 13,000 in the U.S. and more than 7,000 in international locations. 5 Table of Contents Safety.
Website Access Our Internet address is www.wesco.com . Information contained on our website is not part of, and should not be construed as being incorporated by reference into, this Annual Report on Form 10-K.
Information contained on our website is not part of, and should not be construed as being incorporated by reference into, this Annual Report on Form 10-K.
We are implementing digital tools that add value within the company and at both ends of the supply chain. We have made substantial progress on our digital transformation journey. These digital capabilities will improve efficiency and sales effectiveness of our business, and will enable us to create more value to our customers and supplier partners.
We are implementing digital tools to add value within the company and at both ends of the supply chain. We continue to make progress on our digital transformation journey. These digital capabilities are expected to improve efficiency and sales effectiveness of our business, and to enable us to create more value for our customers and supplier partners.
Porwal served as Vice President at Sears Holding Corporation, leading their global procurement function since 2011, and at PepsiCo, Inc. where he held roles with increasing responsibilities in Operations, Supply Chain, Procurement and Finance. Nelson J.
Before joining Wesco, Mr. Porwal served as Vice President at Sears Holding Corporation, leading their global procurement function since 2011, and at PepsiCo, Inc. where he held roles with increasing responsibilities in Operations, Supply Chain, Procurement and Finance. Christine A.
Utility & Broadband Solutions The UBS segment is a leader in North America, with approximately 2,300 employees serving customers primarily in the U.S. and Canada, and provides products and services to investor-owned utilities, public power companies, including municipalities, as well as global service providers, wireless providers, broadband operators and the contractors that service these customers.
Utility & Broadband Solutions The UBS segment is a leader in North America, serving customers primarily in the U.S. and Canada, and provides products and services to investor owned utilities, electric power cooperatives and municipalities, as well as global service providers, wireless providers, broadband operators and the contractors that service these customers.
This includes 59 facilities that operate as regional distribution centers or large fulfillment centers, of which 46 are located in the U.S., eight in Canada, three in Europe and two in South America. Human Capital At Wesco, our people and our high-performance culture are our greatest assets.
This includes 63 facilities that operate as large distribution centers or large fulfillment centers in key geographic areas, of which 49 are located in the U.S., eight in Canada, three in Europe, two in South America and one in Australia. Human Capital At Wesco, our people and our high-performance culture are our greatest assets.
Our sustainability efforts are an integral part of our operations and core values. 3 Table of Contents Customers We have a large base of nearly 140,000 active customers across commercial and industrial businesses, contractors, educational institutions, government agencies, technology companies, telecommunications providers, and utilities. Our top ten customers accounted for approximately 12% of our sales in 2024.
Our sustainability efforts are an integral part of our operations and core values. 3 Table of Contents Customers We have a large base of nearly 130,000 active customers across commercial and industrial businesses, technology companies, telecommunications providers and utilities. Our top ten customers accounted for approximately 15% of our sales in 2025.
Wesco aligns with the Task Force on Climate-Related Financial Disclosures (“TCFD”) framework. We annually review environmental programs, policies, and data, including energy consumption and GHG emissions to identify and assess climate-related risks. The Board of Directors oversees the integration of ESG principles throughout our enterprise. This includes oversight of enterprise risk.
IFRS S2 fully incorporates the recommendations of the now decommissioned Task Force on Climate-related Financial Disclosures (“TCFD”). We annually review environmental programs, policies, and data, including energy consumption and GHG emissions to identify and assess climate-related risks. The Board of Directors oversees the integration of ESG principles throughout our enterprise. This includes oversight of enterprise risk.
Geography We sell to global customers through our network of distribution centers, fulfillment centers, and sales offices consisting of 426 locations in the U.S., 143 in Canada, 56 in Europe and the Middle East, 46 in Central America, the Caribbean and South America, and 57 in the Asia Pacific region, which includes Australia.
Geography We sell to global customers through our network of distribution centers, fulfillment centers and sales offices consisting of 427 locations in the U.S., 144 in Canada, 49 in the Asia Pacific region, which includes Australia, 48 in Europe and the Middle East, and 45 in Central America, the Caribbean and South America.
Company Ethics. We are firmly committed to operating with the highest level of ethics and integrity. This commitment is reflected in our Code of Business Conduct, which applies to our Directors, officers, employees and other parties when they are acting on behalf of Wesco.
We are firmly committed to operating with the highest level of ethics and integrity. This commitment is reflected in our Code of Business Conduct, which applies to our Directors, officers, employees and other parties when they are acting on behalf of Wesco. Annually, employees must acknowledge that they have received, read and will comply with the Code of Business Conduct.
CSS also provides a wide range of professional A/V, safety, facilities, and energy management solutions. The full CSS product portfolio is frequently coupled with services designed to enhance efficiency and productivity across all customer segments globally. These services include data center services, advisory, installation enhancement, project deployment, supply chain solutions, and management platforms.
The full CSS product portfolio is frequently coupled with services designed to enhance efficiency and productivity across all customer segments globally. These services include data center services, advisory, installation enhancement, project deployment, supply chain solutions, and management platforms.
We have developed regional relationships with recycling vendors that recycle non-traditional waste streams, specifically metal and wood. 7 Table of Contents We have a goal to reduce landfill waste intensity by 15% across our U.S. and Canadian locations from a 2020 baseline by 2030. Water.
We have developed regional relationships with recycling vendors that recycle non-traditional waste streams, specifically metal and wood. We have a goal to reduce landfill waste intensity by 15% across our U.S. and Canadian locations from a 2020 baseline by 2030. Water. As a distributor and supply chain solutions provider, we are not a major consumer of water.
This enables us to execute our learning strategy of providing employees with the knowledge, skills, and experiences they need to be effective and productive. We align our learning and development priorities to Wesco’s strategic business goals and initiatives.
Our learning and development function is comprised of seasoned talent that is continuously improving our process and enhancing our learning technology. This enables us to execute our learning strategy of providing employees with the knowledge, skills, and experiences they need to be effective and productive. We align our learning and development priorities to Wesco’s strategic business goals and initiatives.
As a distributor and supply chain solutions provider, we are not a major consumer of water. Our facilities primarily use water for sanitation, cleaning, and irrigation purposes. We track water usage at our locations and use the data to identify unusual consumption patterns that could indicate undetected leaks or excessive usage that requires intervention.
Our facilities primarily use water for sanitation, cleaning, and irrigation purposes. We track water usage at our locations and use the data to identify unusual consumption patterns that could indicate undetected leaks or excessive usage that requires intervention.
The policy includes clear management accountability for environmental sustainability, direct program responsibilities, key performance indicators and other metrics to track progress. We produce a Sustainability Report annually which is made public on our website.
The foundation of our environmental management is our Sustainability and Environmental Compliance Policy, which aligns with key provisions of the ISO 14001:2015 environmental management standards. The policy outlines accountability for environmental sustainability, direct program responsibilities, key performance indicators and other metrics to track progress. We produce a Sustainability Report annually which is made public on our website.
We believe that we are in compliance, in all material respects, with applicable environmental laws. As a result, we do not anticipate making significant capital expenditures for environmental control matters either in the current year or in the near future. Seasonality Our operating results are not significantly affected by seasonal factors.
We believe that we are in compliance, in all material respects, with applicable environmental laws. As a result, we do not anticipate making significant capital expenditures for environmental control matters either in the current year or in the near future. Website Access Our Internet address is www.wesco.com .
Earlier in his career, he was a captain in the United States Army. Christine A. Wolf has served as our Executive Vice President and Chief Human Resources Officer since June 2020, and from June 2018 to June 2020 she served as Senior Vice President and Chief Human Resources Officer. Before joining Wesco from 2011 to June 2018, Ms.
Wolf has served as our Executive Vice President and Chief Human Resources Officer since June 2020, and from June 2018 to June 2020 she served as Senior Vice President and Chief Human Resources Officer. Before joining Wesco from 2011 to June 2018, Ms.
We partner with the industries’ largest suppliers to deliver leading brands across every product category including automation/IoT, broadband, communications, electrical, electronics, energy, lighting, MRO, networking, renewables, safety, security, utility and wire and cable. 4 Table of Contents Customized Solutions. Our customers have unique business models, challenges and priorities.
Our broad product portfolio enables us to offer comprehensive, end-to-end solutions in each of our three business units. We partner with the industries’ largest suppliers to deliver leading brands across every product category including automation/IoT, broadband, communications, electrical, electronics, energy, lighting, MRO, networking, renewables, safety, security, utility and wire and cable. Customized Solutions.
Lazzaris 58 Executive Vice President and General Counsel Hemant Porwal 51 Executive Vice President, Supply Chain and Operations Nelson J. Squires III 63 Executive Vice President and General Manager, Electrical & Electronic Solutions Christine A. Wolf 64 Executive Vice President and Chief Human Resources Officer Set forth below is biographical information for our executive officers listed above. John J.
Lazzaris 59 Executive Vice President and General Counsel Dirk W. Naylor 61 Executive Vice President and General Manager, Communications & Security Solutions Hemant Porwal 52 Executive Vice President, Supply Chain and Operations Christine A. Wolf 65 Executive Vice President and Chief Human Resources Officer Set forth below is biographical information for our executive officers listed above. John J.
In the security business, CSS offers on premise, cloud or hybrid comprehensive solutions for video surveillance, fire and intrusion detection, access control, door locking, and other technologies that help create safe and intelligent environments for customers.
In the security business, CSS offers on-premise, cloud or hybrid comprehensive solutions for video surveillance, fire and intrusion detection, access control, door locking, and other technologies that help create safe and intelligent environments for customers. The data center, network infrastructure, and security businesses are large and diverse, encompassing sectors such as technology, finance, telecommunications, transportation, education, government, healthcare, and retail.
Our scale, broad portfolio of products, technical expertise, global reach with local relationships, smart, digital solutions, and comprehensive value-added services provide distinct advantages that benefit our customers. Broad Portfolio of Products from Top Brands. Our broad product portfolio enables us to offer comprehensive, end-to-end solutions in each of our three business units.
Customers look to product line breadth, product availability, service capabilities, geographic proximity and price. Our scale, broad portfolio of products, technical expertise, global reach with local relationships, smart, digital solutions, and comprehensive value-added services provide distinct advantages that benefit our customers. 4 Table of Contents Broad Portfolio of Products from Top Brands.
We believe that accomplishing this vision depends on the successful execution of our strategy, which comprises three elements: Extend Our Leading Scale and Value Proposition: Our long-term growth potential benefits from secular trends in electrification, automation/IoT, green energy and utility grid modernization, 24/7 connectivity and security, supply chain consolidation, and digitalization and artificial intelligence.
We believe that accomplishing this vision depends on the successful execution of our strategy, which comprises three elements: Extend Our Leading Scale and Value Proposition: Our long-term growth potential benefits from secular trends of digitalization, including AI-driven data centers and automation; electrification, including increased power generation and reliability; and supply chain resiliency, including reshoring.
It also provides an anonymous reporting channel for employees and outside parties to report issues of concern regarding workplace activities or business practices without fear of retaliation . 6 Table of Contents Compensation and Benefits Program. Wesco provides competitive compensation and benefits packages in our locations around the globe.
Our global Ethics and Compliance program provides employees with the tools they need to understand our expectations for ethical business conduct. It also provides an anonymous reporting channel for employees and outside parties to report issues of concern regarding workplace activities or business practices without fear of retaliation . Compensation and Benefits Program.
Construction and industrial customers include a wide array of diversified manufacturers and contractors, engineering, procurement and construction firms for industrial, infrastructure, electrical, commercial, and data and broadband communications projects. Specific applications include projects for refineries, railways, wastewater treatment facilities, data centers, security installations, offices, and modular and mobile homes.
Construction and industrial customers include a wide array of diversified manufacturers and contractors, engineering, procurement and construction firms for industrial, infrastructure, electrical, commercial, and data and broadband communications projects. Specific applications include projects for data centers, hospitals, public transit, waste water treatment facilities, EV charging stations, and renewable and solar power plants.
Adding to our energy consumption is a fleet of approximately 1,300 trucks and 1,800 cars for our distribution and sales activities. Our Fleet Efficiency Policy includes the use of fuel-efficient vehicles, determining the most efficient routes, and idling restrictions. Emissions.
We have implemented lighting retrofit projects, conducted energy audits, and installed solar systems at certain facilities. Adding to our energy consumption is our North American fleet of approximately 3,300 vehicles for our distribution and sales activities. Our Fleet Efficiency Policy includes the use of fuel-efficient vehicles, determining the most efficient routes, and idling restrictions. Emissions.
Schulz 59 Executive Vice President and Chief Financial Officer James F. Cameron 59 Executive Vice President and General Manager, Utility & Broadband Solutions William C. Geary, II 54 Executive Vice President and General Manager, Communications & Security Solutions Akash Khurana 51 Executive Vice President and Chief Information and Digital Officer Diane E.
Schulz 60 Executive Vice President and Chief Financial Officer James F. Cameron 60 Executive Vice President and General Manager, Utility & Broadband Solutions Daniel J. Castillo 57 Executive Vice President and General Manager, Electrical & Electronic Solutions Akash Khurana 52 Executive Vice President and Chief Information and Digital Officer Diane E.
Geary served 22 years and held a variety of senior management roles at Accu-Tech Corporation, a wholly owned subsidiary of Anixter. Akash Khurana has served as our Executive Vice President and Chief Information and Digital Officer since joining the Company in November 2020. Before joining Wesco, Mr.
Previously, he served as President of Cree Lighting and held a variety of business leadership positions at Eaton and Cooper Industries. Akash Khurana has served as our Executive Vice President and Chief Information and Digital Officer since joining the Company in November 2020. Before joining Wesco, Mr.
With millions of products, end-to-end supply chain services, and leading digital capabilities, Wesco provides innovative solutions to meet customer needs across commercial and industrial businesses, contractors, educational institutions, government agencies, technology companies, telecommunications providers, and utilities.
With millions of products, end-to-end supply chain services and significant digital capabilities, Wesco provides innovative solutions to meet customer needs across commercial and industrial businesses, technology companies, telecommunications providers, and utilities. Our innovative solutions include supply chain management, logistics and transportation, procurement, warehousing and inventory management, as well as kitting and labeling, limited assembly of products and installation enhancement.
Hemant Porwal has served as our Executive Vice President, Supply Chain and Operations division since June 2020, and from January 2015 to June 2020 as Vice President of Global Supply Chain and Operations. Before joining Wesco, Mr.
Naylor has held various leadership roles since joining Anixter in 2005. Prior to that, he held leadership positions with Lowry Computer Products and Panduit. Hemant Porwal has served as our Executive Vice President, Supply Chain and Operations division since June 2020, and from January 2015 to June 2020 as Vice President of Global Supply Chain and Operations.
The vast majority of the energy we use is for lighting, heating, and cooling our more than 700 sites, including distribution centers, fulfillment centers, and sales offices, in approximately 50 countries around the world.
The vast majority of the energy we use is for lighting, heating, and cooling our more than 700 sites, in approximately 50 countries around the world. Where practicable, we engage with the owners and agents of the buildings we lease to improve energy efficiency, and we include energy-efficiency requirements in new building leases.
Each of our business units is positioned to benefit from secular trends that are driving growth. These include increasing electrification, growth of automation/IoT, data center, green energy and utility grid modernization, 24/7 connectivity and security, supply chain consolidation and relocation to North America, and digitalization and AI. Ingenuity and Expertise.
Uniquely Positioned to Benefit from Secular Trends . Each of our business units is positioned to benefit from secular trends that are driving growth. These include digitalization, including AI-driven data centers and automation; electrification, including increased power generation and reliability; and supply chain resiliency, including reshoring. Ingenuity and Expertise.
Geary, II has served as our Executive Vice President and General Manager of the Communications & Security Solutions division since June 2020. Prior to the merger with Anixter in 2020, Mr.
Naylor has served as our Executive Vice President and General Manager of the Communications & Security Solutions division since July 2025, and from 2021 to June 2025, he served as Senior Vice President and General Manager - Communications & Security Solutions USA and Global Accounts and Senior Vice President, Global Accounts from 2018 to 2021. Mr.
We strive to continually improve our environmental management by establishing and working towards various sustainability objectives. We leverage our environmental management experience in our offerings of products and services to our customers. The foundation of our environmental management is our Global Environmental, Health, Safety and Sustainability Policy, which aligns with key provisions of the ISO 14001:2015 environmental management standards.
Employees are encouraged to volunteer in their communities by taking part in Wesco’s global annual day of caring. Environmental Management We strive to continually improve our environmental management by establishing and working towards various sustainability objectives. We leverage our environmental management experience in our offerings of products and services to our customers.
Wesco offers certification and training programs, some of which are required for all employees while others are voluntary or based on job role. Employees also have access to external training resources. Our learning and development function is comprised of seasoned talent that is continuously improving our process and enhancing our learning technology.
We have set a goal to achieve a 15% reduction in the total recordable injury rate (“TRIR”) from a 2020 baseline by 2030. Training and Development. Wesco offers certification and training programs, some of which are required for all employees while others are voluntary or based on job role. Employees also have access to external training resources.
Squires III has served as our Executive Vice President and General Manager of the Electrical & Electronic Solutions division since June 2020, and from October 2019 to June 2020 he served as our Senior Vice President and Chief Operating Officer.
Castillo has served as our Executive Vice President and General Manager of the Electrical & Electronic Solutions division since September 1, 2025. Prior to joining Wesco, Mr.
We also have a team that focuses on providing technical support to installers and end-users of renewable products and solutions. Business Strengths Wesco’s mission is to help our customers build, connect, power and protect the world. We believe that our business possesses strengths that will enable us to achieve this mission.
Business Strengths Wesco’s mission is to help our customers build, connect, power and protect the world. We believe that our business possesses strengths that will enable us to achieve this mission. The environment in which we operate is highly fragmented and there is significant competition within each end market and geographic area that we serve.
The key components of our health and safety program are management and supervisory responsibilities, employee responsibilities, accident investigation processes, reporting of safety concerns, safety committee systems, new employee orientation, enforcement procedure, and regulatory compliance. We have set a goal to achieve a 15% reduction in the total recordable injury rate (“TRIR”) from a 2020 baseline by 2030. Training and Development.
Our health and safety program considers elements of the ISO-45001 guidelines and standards. The key components of our health and safety program are management and supervisory responsibilities, employee responsibilities, incident investigation processes, reporting of safety concerns, safety committee systems, new employee orientation, enforcement procedure, and regulatory compliance.
The data center, network infrastructure, and security businesses are large and diverse, encompassing sectors such as technology, finance, telecommunications, transportation, education, government, healthcare, and retail. CSS sells directly to end-users or through an extensive network of channel partners, including data communications contractors, security and network integrators, professional audio/visual integrators, and systems integrators.
CSS sells directly to end-users or through an extensive network of channel partners, including data communications contractors, security and network integrators, professional audio/visual integrators, and systems integrators. CSS also provides a wide range of professional A/V, safety, facilities, and energy management solutions.
Wesco has established relationships with several charitable organizations and encourages employees to volunteer in the community by providing one day of paid volunteer time off per year. By connecting with and contributing to local charitable organizations, Wesco supports the development of strong, vibrant and diverse communities.
Wesco has established relationships with several charitable organizations and encourages employees to volunteer in the community by organizing events and promoting a wide-range of options globally. Every employee is provided a full day of paid time off to volunteer in the community annually.
We have implemented policies and technology to reduce the emissions impact of our fleet, which included evaluation of alternative fuel sources and an assessment of electric vehicle integration into our truck and sales fleet. We have a goal to reduce absolute direct and certain indirect GHG emissions by 30% from a 2021 baseline by 2030. Climate Impact.
We have implemented policies and technology to reduce the emissions impact of our fleet, which include evaluating alternative fuel sources, assessing the integration of hybrid and electric vehicle into our fleet, efficient route practices and idling restrictions. We also have emissions from employees commuting, corporate travel and the lifecycle impact of our landfilled waste.
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Our innovative solutions include supply chain management, logistics and transportation, procurement, warehousing and inventory management, as well as kitting and labeling, limited assembly of products and installation enhancement.
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We seek to drive efficiency and profitability by providing innovative and customizable services that help our customers and partners work smarter. Positioned in the center of the value chain, we aggregate technologies and digital capabilities to help deliver deeper insights and new opportunities for our customers.
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We are also a provider of services focused on energy efficiency and renewable power to reduce our energy consumption and that of our customers. Our energy solutions offer turnkey and retrofit solutions designed to reduce energy consumption and improve building efficiency.
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Wesco provides competitive compensation and benefits packages in our locations around the globe.
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The environment in which we operate is highly fragmented and there is significant competition within each end market and geographic area that we serve. Customers look to product line breadth, product availability, service capabilities, geographic proximity and price.
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Our decarbonization strategy is focused on initiatives targeting these emissions sources, such as renewable energy, energy efficiency improvements, heating, ventilation and air conditioning upgrades and electrification. A secondary source of our GHG emissions is our fleet.
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Our health and safety program considers both preventative and reactionary management concepts and elements of the ISO-45001 guidelines and standards, as well as the strictest global regulations.
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We have a goal to reduce absolute direct and certain indirect GHG emissions by 30% from a 2021 baseline by 2030. 7 Table of Contents Climate Impact. Wesco aligns with the International Financial Reporting Standards S2 Climate-related Disclosures (“IFRS S2”), developed by the International Sustainability Standards Board (“ISSB”).
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Annually, employees must acknowledge that they have received, read and will comply with the Code of Business Conduct. Our global Ethics and Compliance program provides employees with the tools they need to understand our expectations for ethical business conduct.
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Castillo served as Executive Vice President and President, North America at Brink's Company from 2022 to 2025; Executive Vice President and President, North America at JELD-WEN, Inc. from 2020 to 2022 and President, North America Doors from 2018 to 2020.
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Where practicable, we engage with the owners and agents of the buildings we lease to improve energy efficiency, and we include energy-efficiency requirements in new building leases. We have implemented lighting retrofit projects, conducted energy audits, and installed solar systems at certain facilities.
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A secondary source of our GHG emissions is our truck and car fleet, and part of our emissions is due to corporate travel and the lifecycle impact of our landfilled waste.
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Sales during the first and fourth quarters have historically been affected by a reduced level of activity primarily due to the impact of weather on projects. Sales typically increase beginning in March, with slight fluctuations per month through October. During periods of economic expansion or contraction, our sales by quarter have varied significantly from this pattern.
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Geary served as Executive Vice President - Network & Security Solutions of Anixter International Inc. from July 2017 to June 2020 and Senior Vice President - Global Markets - Network & Security Solutions from January 2017 to June 2017. Previously, Mr.
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From January 2018 to September 2019 he served as Group Vice President and General Manager of Wesco Canada/International/WIS and as Group Vice President and General Manager of Wesco Canada from August 2015 to January 2018.
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From 2010 to July 2015 he was Vice President and General Manager, North America Merchant Gases and President, Air Products Canada of Air Products and Chemicals, Inc. He has also served in regional and general management positions, as director of investor relations, and in various sales positions at Air Products.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

58 edited+64 added−16 removed111 unchanged
Biggest changeOperating in the global marketplace exposes us to a number of risks including: • geopolitical and security issues, including armed conflict and civil or military unrest (such as the evolving Russia-Ukraine and Middle East conflicts), political instability, terrorist activity and human rights concerns; • natural disasters (including as a result of climate change) and public health crises (including pandemics such as COVID-19), and other catastrophic events; • global supply chain disruptions and large-scale outages or inefficient provision of services from utilities, transportation, data hosting, or telecommunications providers; • abrupt changes in government policies, laws, regulations, executive orders, spending allocations, or treaties, including imposition of export, import, or doing-business regulations, trade sanctions, embargoes or other trade restrictions (such as sanctions and other restrictions imposed against Russia in response to the Russia-Ukraine conflict, those against China to mitigate the potential U.S. national security concerns related to critical infrastructure and technology, as well as tariffs and trade measures that may increase the cost of goods, limit the availability of key materials, or otherwise disrupt supply chains, pricing, and demand; 11 Table of Contents • regulatory uncertainty, including potential challenges to agency rulemaking authority, which could increase litigation risks, complicate compliance planning, and disrupt our operations; • tax increases, tariff increases, or retaliatory trade measures, including those intended to address trade imbalances or protect domestic industries, that could impact the pricing of our products, the cost and availability of raw materials and components used in production, and the competitiveness of our goods in key markets, while also contributing to broader economic uncertainty, inflationary pressures, and disruptions in our supply chain; • government restrictions on, or nationalization of, our operations in any country; • changes in labor conditions and difficulties in staffing and managing international operations, including logistical and communication challenges; • monetary policy of the countries where we operate and related currency exchange rate fluctuations; • challenges in protecting our IP rights in certain countries; • local business and cultural factors that differ from our current standards and practices; • continuing uncertainty regarding social, political, immigration, tax, and trade policies in the U.S. and abroad; and • other social, political and economic instability, including recessions and other economic crises in other regions.
Biggest changeOperating in the global marketplace exposes us to a number of risks including: • geopolitical and security issues, including armed conflict and civil or military unrest, political instability, terrorist activity and human rights concerns; 11 Table of Contents • natural disasters (including as a result of climate change) and public health crises (including pandemics such as COVID-19 and its variants), and other catastrophic events; • global supply chain disruptions and large-scale outages or inefficient provision of services from utilities, transportation, data hosting, or telecommunications providers; • abrupt changes in government policies, laws, regulations, executive orders, spending allocations, or treaties, including imposition of export, import, or doing-business regulations, trade sanctions, embargoes or other trade restrictions, as well as tariffs and trade measures that may increase the cost of goods, limit the availability of key materials, or otherwise disrupt supply chains, pricing, and demand; • changing and expanding export controls, sanctions, and data localization rules which could restrict our ability to source, sell or service certain products, software or technologies; • regulatory uncertainty, including potential challenges to agency rulemaking authority, which could increase litigation risks, complicate compliance planning, and disrupt our operations; • tax increases, tariff increases, or retaliatory trade measures, including those intended to address trade imbalances or protect domestic industries, that could impact the pricing of our products, the cost and availability of raw materials and components used in production, and the competitiveness of our goods in key markets, while also contributing to broader economic uncertainty, inflationary pressures, and disruptions in our supply chain; • government restrictions on, or nationalization of, our operations in any country; • changes in labor conditions and difficulties in staffing and managing international operations, including logistical and communication challenges; • monetary policy of the countries where we operate and related currency exchange rate fluctuations; • challenges in protecting our IP rights in certain countries; • local business and cultural factors that differ from our current standards and practices; • continuing uncertainty regarding social, political, immigration, tax, and trade policies in the U.S. and abroad; and • other social, political and economic instability, including recessions and other economic crises in other regions.
Supply chain constraints, increased product costs and inflationary pressures could continue or escalate in the future, for example if the Russia-Ukraine, Middle East and other geopolitical conflicts escalate or are further prolonged, which would have an adverse impact on our business and results of operations.
Supply chain constraints, increased product costs and inflationary pressures could continue or escalate in the future, for example if the Russia-Ukraine, Middle East or other geopolitical conflicts escalate or are further prolonged, which would have an adverse impact on our business and results of operations.
Our ability to service and refinance our indebtedness, make scheduled payments on our operating leases, fund capital expenditures, acquisitions or other business opportunities, repurchase shares, and pay dividends will depend in large part on both our future performance and the availability of additional financing in the future, as well as prevailing interest rates and other market conditions and other factors beyond our control.
Our ability to service and refinance our indebtedness, make scheduled payments on our operating and finance leases, fund capital expenditures, acquisitions or other business opportunities, repurchase shares, and pay dividends will depend in large part on both our future performance and the availability of additional financing in the future, as well as prevailing interest rates and other market conditions and other factors beyond our control.
Failure to comply with these covenants or restrictions could result in an event of default, under our revolving lines of credit or the indentures governing certain of our outstanding notes which, if not cured or waived, could accelerate our repayment obligations. See the Liquidity and Capital Resources section in Item 7, “Management’s Discussion and Analysis” for further details.
Failure to comply with these covenants or restrictions could result in an event of default, under our revolving lines of credit or the indentures governing our outstanding notes which, if not cured or waived, could accelerate our repayment obligations. See the Liquidity and Capital Resources section in Item 7, “Management’s Discussion and Analysis” for further details.
We have invested significantly in expanding our digital solutions and digitalization initiatives, including but not limited to, our digital and data platform, e-commerce capabilities, enhancing the online customer experience, software as a service (SaaS), internet of things (IoT) technology, electrification, automation, grid modernization, security, design and engineering services, smart building technology and advisory services.
We have invested significantly in expanding our digital solutions and digitalization initiatives, including but not limited to, our digital and data platform, e-commerce capabilities, enhancing the online customer experience, software as a service (SaaS), internet of things (IoT) technology, artificial intelligence capabilities, electrification, automation, grid modernization, security, design and engineering services, smart building technology and advisory services.
Simultaneously, increased expectations and regulations around ESG reporting and performance may result in higher operating expenses, capital expenditures and costs of goods sold (including those related to deploying low-carbon technologies, expanding our electric vehicle fleet, strengthening ESG monitoring and reporting programs, calculating and disclosing different scopes of greenhouse gas emissions in the manner and timeline expected by regulators and other stakeholders, enhancing supply chain transparency programs, securing assurance by third party auditors over ESG data, developing and implementing climate transition plans that may be requested by customers or required by regulations such as CSDDD, transitioning suppliers due to their ESG programs, other costs to pursue our ESG goals or supplier price increases as manufacturers and services providers accommodate their own ESG-related expenses), which could reduce our profitability and cash flow.
Simultaneously, increased expectations and regulations around ESG reporting and performance may result in higher operating expenses, capital expenditures and costs of goods sold (including those related to deploying low-carbon technologies, expanding our electric vehicle fleet, strengthening ESG monitoring and reporting programs, calculating and disclosing different scopes of GHG emissions in the manner and timeline expected by regulators and other stakeholders, enhancing supply chain transparency programs, securing assurance by third-party auditors over ESG data, developing and implementing climate transition plans that may be requested by customers or required by regulations, transitioning suppliers due to their ESG programs, other costs to pursue our ESG goals or supplier price increases as manufacturers and services providers accommodate their own ESG-related expenses), which could reduce our profitability and cash flow.
Our credit facilities and our other debt agreements contain various covenants that restrict or limit our ability to, among other things: • incur additional indebtedness or create liens on assets; • engage in mergers, acquisitions or consolidations; • make loans or other investments; • transfer, lease or dispose of assets outside the ordinary course of business; 20 Table of Contents • pay dividends, repurchase equity interests, make other payments with respect to equity interests, repay or repurchase subordinated debt; and • engage in affiliate transactions.
Our credit facilities and our other debt agreements contain various covenants that restrict or limit our ability to, among other things: • incur additional indebtedness or create liens on assets; • engage in mergers, acquisitions or consolidations; • make loans or other investments; • transfer, lease or dispose of assets outside the ordinary course of business; • pay dividends, repurchase equity interests, make other payments with respect to equity interests, repay or repurchase subordinated debt; and • engage in affiliate transactions.
In the event of substandard performance by our service providers, or if we are unable to promptly replace them with competent alternatives, our business, reputation, and financial condition could be adversely affected. We may consider outsourcing additional functions in the future, further heightening these risks. 18 Table of Contents An increase in competition could decrease sales, profit margins, and earnings.
In the event of substandard performance by our service providers, or if we are unable to promptly replace them with competent alternatives, our business, reputation, and financial condition could be adversely affected. We may consider outsourcing additional functions in the future, further heightening these risks. An increase in competition could decrease sales, profit margins, and earnings.
From time to time we are involved in legal proceedings, audits or investigations which may relate to, for example, product liability, labor and employment (including wage and hour), tax, escheat, import and export compliance, government contracts, FAR and DFARS compliance, worker health and safety, intellectual property misappropriation or infringement, and general commercial and securities matters.
From time to time we are involved in legal proceedings, audits or investigations which may relate to, for example, product liability, labor and employment (including wage and hour), tax, escheat, import and export compliance, government contracts, FAR and DFARS compliance, worker health and safety, intellectual property misappropriation or infringement, antitrust and business practices, and general commercial and securities matters.
Further, many of the products and services we provide to customers rely on information technology to transmit and store data in Company, cloud-based and third-party systems. Even where Company-managed information systems remain fully operational, a failure by a third-party’s systems or procedures could have negative effects on our operations.
Further, many of the products and services we provide to customers rely on information technology to transmit and store data in Company, cloud-based and third-party systems. Even where Company-managed information systems remain fully operational, a failure by a third-party’s systems or procedures could have negative 14 Table of Contents effects on our operations.
Although no single customer accounts for more than 4% of our sales, a payment default by one of our larger customers could have a negative short-term impact on earnings or liquidity.
Although no single customer accounts for more than 5% of our sales, a payment default by one of our larger customers could have a negative short-term impact on earnings or liquidity.
We seek to mitigate our exposures to disaster events in a number of ways. For example, where feasible, we design the configuration of our facilities to reduce the consequences of disasters. We also maintain insurance for our facilities against casualties, and we evaluate our risks and develop contingency plans for dealing with them.
We seek to mitigate our exposures to disaster events in a number of ways. For example, where 19 Table of Contents feasible, we design the configuration of our facilities to reduce the consequences of disasters. We also maintain insurance for our facilities against casualties, and we evaluate our risks and develop contingency plans for dealing with them.
In addition, the risk of retaliatory cyber-attacks has increased as a result of geopolitical conflicts, including the Middle East and Russia-Ukraine conflicts. These threats and vulnerabilities pose a risk to 15 Table of Contents the security of our systems and networks and the confidentiality, availability and integrity of our proprietary and confidential information.
In addition, the risk of retaliatory cyber-attacks has increased as a result of geopolitical conflicts, including the Middle East and Russia-Ukraine conflicts. These threats and vulnerabilities pose a risk to the security of our systems and networks and the confidentiality, availability and integrity of our proprietary and confidential information.
They include laws and regulations covering taxation, trade, import and export, labor and employment (including wage and hour), product safety, product labeling, occupational safety and health, data privacy, data protection, intellectual property, artificial intelligence, and sustainability and environmental matters (including those relating to global climate change and its impact).
They include laws and regulations covering taxation, trade, import and export, labor and employment (including wage and hour), product safety, product labeling, occupational safety and health, data privacy, data protection, intellectual property, AI, and sustainability and environmental matters (including those relating to global climate change and its impact).
Even if we successfully defend against claims, we may incur significant costs that could adversely affect our results of operations, financial condition and cash flow. We must attract, retain and motivate our employees, and the failure to do so may adversely affect our business.
Even if we successfully defend against claims, we may incur significant costs that could adversely affect our results of operations, financial condition and cash flow. 23 Table of Contents We must attract, retain and motivate our employees, and the failure to do so may adversely affect our business.
The profitability of our business is also dependent upon the efficiency of our supply chain. An inefficient or ineffective supply chain strategy or operations could increase operational costs, decrease sales, profit margins and earnings, which could adversely affect our business. Product cost fluctuations could decrease sales, profit margins and earnings.
The profitability of our business is also dependent upon the efficiency of our supply chain. An inefficient or ineffective supply chain strategy or operations could increase operational costs, decrease sales, profit margins and earnings, which could adversely affect our business. 18 Table of Contents Product cost fluctuations could decrease sales, profit margins and earnings.
The dynamic and rapidly evolving nature of AI technologies and their applications necessitates continuous monitoring and updating of systems, processes, and policies, which, if not adequately managed, could exacerbate the risks of obsolescence, unintended outcomes, or compliance failures.
The dynamic and rapidly evolving nature of artificial intelligence technologies and their applications necessitates continuous monitoring and updating of systems, processes, and policies, which, if not adequately managed, could exacerbate the risks of obsolescence, unintended outcomes, or compliance failures.
There can be no assurance that economic and political instability, both domestically and internationally (for example, resulting from the Russia-Ukraine or Middle East conflicts, changes in the creditworthiness of the U.S. or any government, changes to economic or trade policies, sanctions, tariffs or participation in trade agreements or economic and political unions) will not adversely affect our results of operations, cash flows or financial position in the future.
There can be no assurance that economic and political instability, both domestically and internationally (for example, resulting from the geopolitical conflicts, changes in the creditworthiness of the U.S. or any government, changes to economic or trade policies, sanctions, tariffs or participation in trade agreements or economic and political unions) will not adversely affect our results of operations, cash flows or financial position in the future.
In 2024, we saw continued improvements in supply chain resilience, with manufacturers further adjusting their production footprints through diversification, reshoring, nearshoring 16 Table of Contents and other strategies designed at mitigating tariff and other supply chain risks, alongside continued volatility in the availability of certain raw materials, components and products.
In 2024 and 2025, we saw continued improvements in supply chain resilience, with manufacturers further adjusting their production footprints through diversification, reshoring, nearshoring and other strategies designed at mitigating tariff and other supply chain risks, alongside continued volatility in the availability of certain raw materials, components and products.
If we are unable to repay indebtedness, lenders having secured obligations could proceed against the collateral securing these obligations. Our debt agreements contain restrictive covenants that may limit our ability to operate our business.
If we are unable to repay indebtedness, lenders having secured obligations could proceed against the collateral securing these obligations. 22 Table of Contents Our debt agreements contain restrictive covenants that may limit our ability to operate our business.
Furthermore, inadequate talent management and succession planning, along with potential challenges in adapting to evolving workplace trends and expectations, could hinder our ability to respond to market changes and maintain a competitive edge, which could lead to decreased productivity, reduced market share, and ultimately, a decline in financial performance.
Furthermore, inadequate talent management and succession planning, along with potential challenges in adapting to evolving workplace trends and expectations, could hinder our ability to respond to market changes and maintain a competitive edge, which could lead to decreased productivity, reduced market share, and ultimately, a decline in financial performance. Item 1B. Unresolved Staff Comments. None.
The economic, political and financial environment may also affect our business and financial condition in ways that we currently cannot predict. The Russia-Ukraine and Middle East conflicts, and resulting international responses, have contributed to further volatility and uncertainty in the global financial and commodities markets, resulting in fluctuations in oil and commodity prices.
The economic, political and financial environment may also affect our business and financial condition in ways that we currently cannot predict. Certain geopolitical conflicts, and resulting international responses, have contributed to further volatility and uncertainty in the global financial and commodities markets, resulting in fluctuations in oil and commodity prices.
We are subject to a broad range of laws and regulations in the jurisdictions where we operate globally, including, among others, those relating to data privacy and protection, cyber security, import and export requirements, anti-bribery and corruption, product compliance, supplier regulations regarding the sources of supplies or products, sustainability and environmental protection, health and safety requirements, intellectual property, foreign exchange controls and cash repatriation restrictions, labor and employment, human rights, e-commerce, advertising and marketing, anti-competition, artificial intelligence and tax.
We are subject to a broad range of laws and regulations in the jurisdictions where we operate globally, including, among others, those relating to data privacy and protection, cyber security, import and export requirements, anti-bribery and corruption, product compliance, extended producer responsibility requirements, supplier regulations regarding the sources of supplies or products (such as the Uyghur Forced Labor Prevention Act or other forced labor, traceability and country of origin verification requirements), sustainability and environmental protection, health and safety requirements, intellectual property, foreign exchange controls and cash repatriation restrictions, labor and employment, human rights, e-commerce, advertising and marketing, anti-competition, artificial intelligence and tax.
Project awards often involve complex and lengthy negotiations and competitive bidding processes. These processes can be impacted by a wide range of factors including a customer’s decision to not proceed with a project or its inability to obtain necessary governmental approvals or financing, commodity prices, interest rates, and overall market and economic conditions.
These processes can be impacted by a wide range of factors including a customer’s decision to not proceed with a project or its inability to obtain necessary governmental approvals or financing, commodity prices, interest rates, and overall market and economic conditions.
Our continued success may depend on our ability to execute environmental, social and governance (“ESG”) programs as planned and may impact our reputation and operating costs. Customers, suppliers, employees, community partners, shareholders and regulatory agencies in various jurisdictions globally are increasingly requesting disclosure and action relating to ESG objectives and performance.
Our continued success may depend on our ability to execute ESG programs as planned and may impact our reputation and operating costs. Customers, suppliers, employees, community partners, shareholders and regulatory agencies in various jurisdictions globally request disclosure and action relating to ESG objectives and performance.
Our global operations expose us to political, economic, legal, currency and other risks. We operate a network of more than 700 sites, including distribution centers, fulfillment centers, and sales offices, with operations in approximately 50 countries. Approximately one-third of our employee population are non-U.S. employees. We derive approximately 26% of our revenues from sales outside of the U.S.
We operate a network of more than 700 sites, including distribution centers, fulfillment centers and sales offices with operations in approximately 50 countries. Approximately one-third of our employee population are non-U.S. employees. We derive approximately 26% of our revenues from sales outside of the U.S.
Any one or more of these factors could increase our costs or cause us not to realize the benefits anticipated to result from the acquisition of a business or assets. Divestitures are subject to various risks and uncertainties. On February 23, 2024 we announced the divestiture of our Wesco Integrated Supply business, and the transaction closed on April 1, 2024.
Any one or more of these factors could increase our costs or cause us not to realize the benefits anticipated to result from the acquisition of a business or assets. Divestitures are subject to various risks and uncertainties. In 2024 we completed the divestiture of our Wesco Integrated Supply business.
It is possible that the integration process of an acquired business could result in the loss of key employees, higher than expected costs, diversion of management attention, the disruption of either company’s ongoing legacy businesses or inconsistencies in standards, controls, procedures and policies that adversely affect the Company’s ability to maintain relationships with customers, suppliers and employees or to achieve the anticipated benefits and cost savings of the transaction. 13 Table of Contents We have incurred, and expect to continue to incur, a number of non-recurring costs associated with recent acquisitions and related integration activities.
It is possible that the integration process of an acquired business could result in the loss of key employees, higher than expected costs, diversion of management attention, the disruption of either company’s ongoing legacy businesses or inconsistencies in standards, controls, procedures and policies that adversely affect the Company’s ability to maintain relationships with customers, suppliers and employees or to achieve the anticipated benefits and cost savings of the transaction.
Any such violations 12 Table of Contents could result in the imposition of fines and penalties, damage to our reputation, and, in the case of laws and regulations relating to governmental contracts, the loss of those contracts. Fluctuations in foreign currency have an effect on our results from operations.
Any such violations could result in the imposition of fines and penalties, remediation costs, product restrictions or prohibitions, contractual claims, litigation, damage to our reputation, and, in the case of laws and regulations relating to governmental contracts, the loss of those contracts. Fluctuations in foreign currency have an effect on our results from operations.
We consider and may pursue other acquisitions on an on-going basis. The success of these and future acquisitions, including anticipated benefits and cost savings, depends on the successful combination and integration of the companies’ businesses.
The success of these and future acquisitions, including anticipated benefits and cost savings, depends on the successful combination and integration of the companies’ businesses.
After we divest a business, we may retain exposure on financial or performance guarantees and other contractual, employment, or severance obligations, and potential liabilities that may arise under law because of the disposition or the subsequent failure of an acquirer.
If we are unable to successfully transition divested businesses, our business and financial results could be negatively impacted. After we divest a business, we may retain exposure on financial or performance guarantees and other contractual, employment, or severance obligations, and potential liabilities that may arise under law because of the disposition or the subsequent failure of an acquirer.
Our failure to execute our ESG programs and objectives as planned, or in accordance with the evolving expectations of various stakeholders or regulators in the United States, Europe and globally, including compliance with potentially inconsistent or competing requirements under standards and regulations such as the EU Corporate Sustainability Reporting Directive (CSRD)’s ESRS standards, ISSB standards incorporated into law by various countries globally, the Corporate Sustainability Due Diligence Directive (“CSDDD”), the Science Based Targets initiative, the EU Taxonomy, California climate disclosure rules under Senate Bills 253 and 261, and the SEC climate-related disclosures rules (a number of which remain subject to ongoing developments or legal challenges), could adversely affect the Company’s reputation, business and financial performance.
Our failure to execute our ESG programs and objectives as planned, or in accordance with the evolving expectations of various stakeholders or regulators in the U.S., Europe and globally, including compliance with standards and regulations such as the EU Corporate Sustainability Reporting Directive (CSRD)’s ESRS standards, ISSB standards 20 Table of Contents incorporated into law by various countries globally, the Science Based Targets initiative, and California climate disclosure rules under Senate Bills 253 and 261, could adversely affect the Company’s reputation, business and financial performance.
In addition, as a result of such claims, we may lose our rights to utilize critical technology or may be required to pay substantial damages or license fees with respect to infringed rights or be required to redesign or restructure our products or services at a substantial cost, any of which could negatively impact our operating results.
In addition, as a result of such claims, we may lose our rights to utilize critical technology or may be required to pay substantial damages or license fees with respect to infringed rights or be required to redesign or restructure our products or services at a substantial cost, any of which could negatively impact our operating results. 17 Table of Contents Risks Related to Our Industry, Markets and Business Operations Loss of key suppliers could decrease sales, profit margins and earnings.
If we experience difficulties with the integration process, the anticipated benefits of recent or future mergers or acquisitions may not be realized or may take longer to realize than expected. These integration matters could have an adverse effect on us for an undetermined period.
If we experience difficulties with the integration process, the anticipated benefits of recent or future mergers or acquisitions may not be realized or may take longer to realize than expected.
In light of these factors, the cumulative impact of such issues, whether service disruptions, regulatory challenges, litigation or remediation costs, reputational harm, or cost escalations, could pose substantial risks to our operational efficiency and our ability to meet our strategic objectives, thereby potentially leading to material adverse effects on our overall business performance and financial results.
In light of these factors, the cumulative impact of such issues, whether service disruptions, regulatory challenges, litigation or remediation costs, reputational harm, or cost escalations, could pose substantial risks to our operational efficiency and our ability to meet our strategic objectives, thereby potentially leading to material adverse effects on our overall business performance and financial results. 16 Table of Contents We may experience a failure in or breach of our information security systems, or those of our third-party product suppliers or service providers, as a result of cyber-attacks or information security breaches.
Our ability to successfully execute these initiatives is subject to various risks and uncertainties and there can be no assurance regarding the timing of or extent to which we will realize the anticipated benefits, if at all. The design, development, and implementation of new systems and applications carries inherent risks, including potential technical failures, integration challenges, and business disruptions.
Our ability to successfully execute these initiatives is subject to various risks and uncertainties and there can be no assurance regarding the timing of or extent to which we will realize the anticipated benefits, if at all.
As of December 31, 2024, excluding debt discount and debt issuance costs, we had $5.1 billion of consolidated indebtedness. We and our subsidiaries may also undertake additional borrowings in the future, subject to certain limitations contained in the debt instruments governing our indebtedness. Our debt service obligations impact our ability to operate and grow our business.
We and our subsidiaries may also undertake additional borrowings in the future, subject to certain limitations contained in the debt instruments governing our indebtedness. Our debt service obligations impact our ability to operate and grow our business.
Any significant or prolonged unavailability or failure of critical information systems could materially impair our ability to maintain proper levels of inventories, process orders, meet the demands of our customers and suppliers in a timely manner, and other harmful effects on our business operations, which could negatively affect our financial results. 14 Table of Contents We may not be able to realize the anticipated benefits and cost savings of our digital transformation initiatives or enhancing existing, and deploying new, technology, digital products and information systems in our operations.
Any significant or prolonged unavailability or failure of critical information systems could materially impair our ability to maintain proper levels of inventories, process orders, meet the demands of our customers and suppliers in a timely manner, and other harmful effects on our business operations, which could negatively affect our financial results.
Changes in the tax law at the federal and state/provincial levels, in particular in the U.S. and Canada, jurisdictions which account for most of our income before taxes, can have a material adverse effect on our results of operations. 19 Table of Contents The Organization for Economic Cooperation and Development (the “OECD”) issued rules to address the tax challenges arising from the digitalization of the global economy.
Changes in the tax law at the federal and state/provincial levels, in particular, in the U.S. and Canada, jurisdictions which account for most of our income before taxes, can have a material adverse effect on our results of operations.
The effects of global climate change could increase the frequency and intensity of natural disasters or extreme weather conditions, such as tropical storms, severe winter weather, drought, flooding, heat waves, wildfires and rising sea levels, which could cause or exacerbate supply chain interruptions.
The effects of global climate change could increase the frequency and intensity of acute physical risks (such as tropical storms, severe winter weather, drought, flooding, or wildfires), chronic physical risks (such as rising sea levels or shifting precipitation patterns) and transition risks (such as rising costs of regulatory compliance), which could cause or exacerbate supply chain interruptions.
We have been and may continue to be adversely affected by supply chain challenges, including product shortages, delays and price increases, which could decrease sales, profit margins and earnings.
If suppliers modify the terms of these programs, or if we fail to satisfy specified conditions, our margins could decline. We have been, and may continue to be, adversely affected by supply chain challenges, including product shortages, delays and price increases, which could decrease sales, profit margins and earnings.
The results of certain of our foreign operations are reported in the local currency and then translated into U.S. dollars at the applicable exchange rates for inclusion in our consolidated financial statements.
The results of certain of our foreign operations are reported in the local currency and then translated into U.S. dollars at the applicable exchange rates for inclusion in our consolidated financial statements. The exchange rates between some of these currencies and the U.S. dollar have fluctuated significantly in recent years, and may continue to do so in the future.
Divestitures involve risks and uncertainties, such as the separation of assets that are being sold, employee distraction, potential disruptions to customer and vendor relationships, and tax obligations or loss of tax benefits. If we are unable to successfully transition divested businesses, our business and financial results could be negatively impacted.
We may consider and undertake divestitures of other businesses in the future. Divestitures involve risks and uncertainties, such as the separation of assets that are being sold, employee distraction, potential disruptions to customer and vendor relationships, and tax obligations or loss of tax benefits.
If the financial performance of the Company does not meet current expectations, then our ability to service or repay our indebtedness may be adversely impacted. If unable to do so, we may be required to refinance all or a portion of our existing debt, sell assets, or obtain additional financing.
If unable to do so, we may be required to refinance all or a portion of our existing debt, sell assets, or obtain additional financing.
This includes transaction fees and expenses related to formulating and implementing integration plans, including facilities, systems consolidation and employment-related costs. We continue to assess the magnitude of these costs, and additional unanticipated costs may be incurred in the integration of the acquired companies’ businesses.
We continue to assess the magnitude of these costs, and additional unanticipated costs may be incurred in the integration of the acquired companies’ businesses.
In 2020, we incurred significant additional indebtedness to finance the merger with Anixter. As a result, a substantial portion of our cash flow from operations must be dedicated to the payment of principal and interest on our indebtedness, thereby reducing the funds available to us for other purposes.
As a result, a substantial portion of our cash flow from operations must be dedicated to the payment of principal and interest on our indebtedness, thereby reducing the funds available to us for other purposes. As of December 31, 2025, excluding debt discount and debt issuance costs, we had $5.8 billion of consolidated indebtedness.
To the extent the Russia-Ukraine and Middle East conflicts escalate or are further prolonged, it may have the effect of heightening many of the risks described above or elsewhere in these risk factors.
To the extent conflicts escalate or are further prolonged, it may have the effect of heightening many of the risks described above or elsewhere in these risk factors. We are subject to various laws and regulations globally and any failure to comply could adversely affect our business.
The insurance coverage we maintain may be inadequate to cover claims or liabilities relating to a cybersecurity attack. In addition, the legal and regulatory environment surrounding information security and privacy in the U.S. and international jurisdictions is constantly evolving and additional laws and regulations regarding artificial intelligence are being considered and implemented.
In addition, the legal and regulatory environment surrounding information security and privacy in the U.S. and international jurisdictions is constantly evolving and additional laws and regulations regarding AI are being considered and implemented.
Furthermore, as a government contractor selling to federal, state and local government entities, we are also subject to a wide variety of additional laws and regulations, including the Federal Acquisition Regulation (“FAR”) and Defense Federal Acquisitions Regulation Supplement (“DFARS”). Proposed laws and regulations in these and other areas could affect the cost of our business operations.
Furthermore, as a government contractor selling to federal, state and local government entities, we are also subject to a wide variety of additional laws and regulations, including the Federal Acquisition Regulation (“FAR”) and Defense Federal Acquisitions Regulation Supplement (“DFARS”), and additional compliance obligations, such as Cybersecurity Maturity Model Certification (CMMC) compliance, domestic preference and Buy America/Build America requirements.
Any future acquisitions that we may undertake will involve a number of inherent risks, any of which could cause us not to realize the anticipated benefits. We have expanded our operations through organic growth and selected acquisitions of businesses and assets, such as our acquisitions of Rahi Systems, entroCIM and Ascent, and may seek to do so in the future.
We have expanded our operations through organic growth and selected acquisitions of businesses and assets, such as our acquisitions of Rahi Systems, entroCIM, Independent Electric Supply, Ascent and Industrial Software Solutions, and may seek to do so in the future.
While much of our sales and earnings are generated by comparatively smaller and more frequent orders, the fulfillment of large orders for large capital projects generates significant sales and earnings.
While much of our sales and earnings are generated by comparatively smaller and more frequent orders, the fulfillment of large orders for large capital projects generates significant sales and earnings. Accordingly, our results of operations can fluctuate depending on whether and when large project awards occur and the commencement and progress of work under large contracts already awarded.
We may not be able to fully realize the anticipated benefits and cost savings of mergers and acquisitions. In 2020, we completed our merger with Anixter; in 2022, we completed the acquisition of Rahi Systems; and in 2024, we completed several acquisitions, including those of entroCIM, Independent Electric Supply, and Ascent.
In 2020, we completed our merger with Anixter; in 2022, we completed the acquisition of Rahi Systems; and in 2024 and 2025, we completed several acquisitions, including those of entroCIM, Independent Electric Supply, Ascent and Industrial Software Solutions. We consider and may pursue other acquisitions on an on-going basis.
In addition, because our financial statements are stated in U.S. dollars, such fluctuations may also affect the comparability of our results between financial periods.
In addition, because our financial statements are stated in U.S. dollars, such fluctuations may also affect the comparability of our results between financial 12 Table of Contents periods. Refer to Item 7A, “Quantitative and Qualitative Disclosures About Market Risks” for additional details on foreign currency risks.
The Company does not expect the current proposed and enacted rules to have a material impact on the Company’s worldwide tax expense but they are likely to create significant compliance obligations. Finally, the tax laws to which the Company is subject are inherently complex and ambiguous.
The Company continues to evaluate the impact of developments concerning the global minimum tax rules. The Company does not expect the global minimum tax rules to have a material impact on the Company’s worldwide tax expense, but they are expected to create significant additional compliance obligations.
We cannot assure you that we will be able to obtain additional financing on terms acceptable to us or at all. There can be no assurance that our business will continue to generate sufficient cash flows from operations in the future to service our debt, make necessary capital expenditures, or meet other cash needs.
There can be no assurance that our business will continue to generate sufficient cash flows from operations in the future to service our debt, make necessary capital expenditures, or meet other cash needs. If the financial performance of the Company does not meet current expectations, then our ability to service or repay our indebtedness may be adversely impacted.
These risks could result in operational inefficiencies, system downtime, or other unforeseen complications that may adversely affect our business operations and customer relationships. Additionally, our initiatives may require significant capital investments and resource allocation, and any delays, cost overruns, or implementation difficulties could negatively impact our expected return on investment and overall business performance.
Additionally, our initiatives may require significant capital investments and resource allocation, and any delays, cost overruns, or implementation difficulties could negatively impact our expected return on investment and overall business performance. We may not be able to fully realize the anticipated benefits and cost savings of mergers and acquisitions.
Risks Related to Our Industry, Markets and Business Operations Loss of key suppliers could decrease sales, profit margins and earnings. Most of our agreements with suppliers are terminable by either party on 60 days’ notice or less for any reason. We currently source products from thousands of suppliers.
Most of our agreements with suppliers are terminable by either party on 60 days’ notice or less for any reason. We currently source products from thousands of suppliers. However, our 10 largest suppliers in 2025 accounted for approximately 32% of our purchases by dollar volume for the period.
Accordingly, our results of operations can fluctuate depending on whether and when large project awards occur and the commencement and progress of work under large contracts already awarded. 17 Table of Contents The awarding and timing of projects is unpredictable and depends on many factors outside of our control.
The awarding and timing of projects is unpredictable and depends on many factors outside of our control. Project awards often involve complex and lengthy negotiations and competitive bidding processes.
Removed
In response to the Russia-Ukraine conflict, the United States, the European Union and other governments throughout the world imposed broad economic sanctions and other restrictions against Russia and Russian interests.
Added
Volatile trade policies, including a shift toward a “reciprocal” tariff regime in the U.S., and retaliatory measures by foreign governments, could materially increase our costs, disrupt supply availability and lead times, reduce price competitiveness, and adversely affect demand for our products and services. Global trade policy remains highly volatile.
Removed
Since October 2023, when Hamas militants attacked Israel, prompting Israel to respond with air strikes and a major ground operation in Gaza, tensions and conflicts have escalated between Israel and other regional actors, including Iran, Syria and Hezbollah in Lebanon.
Added
Sudden, material changes in U.S. and foreign tariff rates, scope, exclusions and enforcement, particularly following the adoption of a “reciprocal” tariff approach by the U.S., as well as retaliatory actions by other jurisdictions, including counter-tariffs and expanded export controls on critical minerals, components, and technologies, could negatively affect the availability and cost of certain products and inputs, extend lead times and impair our ability to fulfill customer orders.
Removed
Our business and operations have been and may continue to be adversely affected by the COVID-19 pandemic, and the duration and extent to which COVID variants or other pandemics will affect our business, financial condition, results of operations, cash flows, liquidity, and stock price remains uncertain.
Added
These measures may also increase our logistics, compliance and working capital costs, and contribute to broader inflationary pressures. We may be unable to pass through incremental costs to customers in a timely manner or at all without adversely affecting our price competitiveness or margins.
Removed
The global COVID-19 pandemic created significant disruption to the broader economies, financial markets, workforces, business environment and supply chains, as well as to our suppliers and customers.
Added
If we are unable to adjust pricing, sourcing or inventory strategies effectively, or if customers reduce or defer purchases (including due to demand destruction arising from higher end-market prices), our business, financial condition and results of operations could be materially adversely affected. Our global operations expose us to political, economic, legal, currency and other risks.
Removed
Beginning in 2020, the pandemic caused significant disruptions to our business due to, among other things, disruptions to our suppliers and global supply chain, labor shortages, transportation disruptions, travel restrictions, the impact on our customers and their demand for our products and services and ability to pay for them, as well as temporary closures of facilities.
Added
Broader geopolitical conflicts and instability could disrupt supply chains, energy markets, cross‑border data flows, and vendor operations, and may result in new or expanded trade controls, export restrictions, sanctions, or heightened cybersecurity threats.
Removed
Some of the actions we have taken in response to the COVID-19 pandemic, such as implementing remote working arrangements, may also create increased vulnerability to cybersecurity incidents and other risks.
Added
The design, development, and implementation of new systems and applications carries inherent risks, including potential technical failures, integration challenges, inadequacy of internal controls, and business disruptions. These risks could result in operational inefficiencies, system downtime, or other unforeseen complications that may adversely affect our business operations and customer relationships.
Removed
Remote working arrangements and the decrease in commercial office occupancy rates may adversely affect sectors of the economy or the bank or financial markets, which may affect our customers or lenders, or may increase market volatility.
Added
We have incurred, and expect to continue to incur, non-recurring costs associated with recent acquisitions and related integration activities. This includes transaction fees and expenses related to formulating and implementing integration plans, including facilities, systems consolidation and employment-related costs.
Removed
The full extent to which new COVID variants or new pandemics may impact our business, results of operations, and financial condition depends on many evolving factors and future developments for which there remains significant uncertainty; the availability, effectiveness and public acceptance of treatments or vaccines (including boosters); the impact of the imposition of governmental actions; and the impact of pandemics on the global supply chain and the broader economy and capital markets, as well as the matters noted above.
Added
These integration matters could have an adverse effect on us for an undetermined period. 13 Table of Contents Any future acquisitions that we may undertake will involve inherent risks, any of which could cause us not to realize the anticipated benefits.
Removed
In addition, COVID variants and other pandemics may adversely affect many of our suppliers’ and customers’ businesses and operations, including the ability of our suppliers to manufacture or obtain the products we sell or to meet delivery requirements and commitments, and our customers’ demand for our products and services and the ability to pay for them, all of which could adversely affect our sales and results of operations.
Added
Heightened antitrust and foreign investment scrutiny could delay, condition, or prevent our strategic transactions. Competition and foreign investment authorities in the U.S. and other jurisdictions are applying more expansive and unpredictable approaches to reviewing mergers, acquisitions, joint ventures, minority investments, and other strategic transactions.
Removed
We may not be able to appropriately respond to or manage the impact of these events, and any of these events could materially adversely affect our business, financial condition, results of operations, cash flows, liquidity and stock price. We are subject to various laws and regulations globally and any failure to comply could adversely affect our business.
Added
Premerger notification and reporting obligations under the Hart-Scott-Rodino Antitrust Improvements Act (“HSR Act”), as well as analogous merger control and foreign direct investment regimes globally, have become more burdensome, costly, and time-consuming. Recent rule changes and evolving agency practices require the submission of significantly more information, including detailed narratives, internal documents, data, and ordinary course materials.
Removed
The exchange rates between some of these currencies and the U.S. dollar have fluctuated significantly in recent years (particularly the Argentine Peso and the Egyptian Pound), and may continue to do so in the future.
Added
Filing fees and compliance costs have increased, and regulators are taking longer to accept filings as complete and to commence or conclude review periods. Even transactions that raise limited or no apparent competitive concerns can face prolonged timelines, significant expense, and uncertainty as to outcome.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeItem 1C. Cybersecurity. Risk Management and Strategy Information security and protection of our data is important to Wesco, our customers and suppliers. As a global company, we face various cybersecurity threats, ranging from phishing, ransomware and denial-of-service attacks to more recent threats incorporating the use of artificial intelligence.
Biggest changeItem 1C. Cybersecurity. Risk Management and Strategy Information security and protection of our data is important to Wesco, our customers and suppliers. As a global company, we face various cybersecurity threats, ranging from phishing, ransomware and denial-of-service attacks to more recent and growing threats incorporating the use of AI, which are becoming more sophisticated.
In response to this evolving cybersecurity threat landscape, we have implemented a cybersecurity risk management program that follows a comprehensive, multi-layered approach to securing our data and business systems from attack, compromise or loss, guided by the National Institute of Standards and Technology (NIST) Cybersecurity Framework.
In response to this evolving cybersecurity threat landscape, we have implemented a cybersecurity risk management program that follows a comprehensive, multi-layered approach to securing our data and business systems from attack, compromise or loss, guided by the National Institute of Standards and Technology (“NIST”) Cybersecurity Framework.
We also engage third-party consultants to perform penetration and vulnerability tests at least once per quarter, as well as annual “red team” engagements that simulate cyber threats. The results of these tests and assessments are used to establish priorities, allocate resources, and improve controls.
We also engage third-party consultants to perform penetration and vulnerability tests at least once per quarter, as well as annual engagements that simulate cyber threats. The results of these tests and assessments are used to establish priorities, allocate resources, and improve controls.
Our CISO has over 30 years of technology experience, including over twelve years of experience dedicated to cybersecurity. He has been in this role with Wesco since 2020 and has a total of approximately nine years of experience serving in the role of Chief Information Security Officer.
Our CISO has over 30 years of technology experience, including over twelve years of experience dedicated to cybersecurity. He has been in this role with Wesco since 2020 and has a total of approximately ten years of experience serving in the role of Chief Information Security Officer.
For more information on our cybersecurity related risks, see Item 1A, “Risk Factors” of this Annual Report on Form 10-K. 22 Table of Contents Governance To more effectively prevent, detect and respond to information security threats, we have a dedicated Chief Information Security Officer (“CISO”) whose team is responsible for leading enterprise-wide information security strategy, policy, standards, architecture and processes.
For more information on our cybersecurity related risks, see Item 1A, “Risk Factors” of this Annual Report on Form 10-K. Governance To more effectively prevent, detect and respond to information security threats, we have a dedicated Chief Information Security Officer (“CISO”) whose team is responsible for leading enterprise-wide information security strategy, policy, standards, architecture and processes.
Our training program also includes expert guest speakers and additional training during cybersecurity awareness month each October. While we focus on prevention and detection, we have response and recovery plans in place, as well as service agreements and partner engagements should there be a need for us to respond to an attack.
Our training program also includes expert guest speakers and additional training during cybersecurity awareness month each October. 24 Table of Contents While we focus on prevention and detection, we have response and recovery plans in place, as well as service agreements and partner engagements should there be a need for us to respond to an attack.
Added
We recognize that even robust preventive and detective controls may not fully eliminate the possibility of a significant AI‑driven cybersecurity incident. However, we are continually evaluating and introducing new processes and controls to mitigate risks from a constantly evolving threat landscape, including those amplified by AI.
Added
Recognizing the transformative potential and risks of AI, Wesco established an AI Governance Council in 2025. This executive-led, cross-functional body ensures the prioritized, ethical and secure use of AI to drive strategic business initiatives while protecting our systems and data.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThis includes 59 facilities with square footage between 100,000 and 500,000 that operate as regional distribution centers or large fulfillment centers, of which 46 are located in the U.S., eight in Canada, three in Europe and two in South America. Approximately 8% of our facilities are owned, and the remainder are leased.
Biggest changeThis includes 63 facilities with square footage between 100,000 and 500,000 that operate as large distribution centers or fulfillment centers, of which 49 are located in the U.S., eight in Canada, three in Europe, two in South America and one in Australia. Approximately 7% of our facilities are owned, and the remainder are leased.
Item 2. Properties. We operate a network of approximately 600 distribution and fulfillment center locations that hold inventory, and approximately 130 sales offices, with operations in approximately 50 countries throughout the world.
Item 2. Properties. We operate a network of approximately 600 distribution and fulfillment center locations that hold inventory, and approximately 120 sales offices, with operations in approximately 50 countries throughout the world.
We also lease our 118,000 square-foot headquarters in Pittsburgh, Pennsylvania. We do not regard the real property associated with any single facility as material to our operations. We believe our facilities are in good operating condition and are adequate for their respective uses.
We also lease our 118,000 square-foot headquarters in Pittsburgh, Pennsylvania. We do not regard the real property associated with any single facility as material to our operations. We believe our facilities are in good operating condition and are adequate for their respective uses. 25 Table of Contents

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest change(2) On June 1, 2022, Wesco announced that its Board of Directors authorized, on May 31, 2022, the repurchase of up to $1 billion of the Company’s common stock and Series A Preferred Stock. The share repurchase authorization has no expiration date and may be modified, suspended, or terminated at any time without prior notice.
Biggest changeThe share repurchase authorization has no expiration date and may be modified, suspended, or terminated at any time without prior notice. During the three months ended December 31, 2025, the Company did not repurchase any shares of its common stock under this share repurchase authorization. 27 Table of Contents Company Performance.
As disclosed in Note 9, “Debt” of our Notes to Consolidated Financial Statements, the terms of the Revolving Credit Facility, as well as the indentures governing the 7.250% Senior Notes due 2028, 6.375% Senior Notes due 2029, and 6.625% Senior Notes due 2032 contain various restrictive covenants that limit the amount of dividends and common stock repurchases that can be made.
As disclosed in Note 9, “Debt” of our Notes to Consolidated Financial Statements, the terms of the Revolving Credit Facility, as well as the indentures governing the 7.250% Senior Notes due 2028, 6.375% Senior Notes due 2029, 6.625% Senior Notes due 2032 and 6.375% Senior Notes due 2033 contain various restrictive covenants that limit the amount of dividends and common stock repurchases that can be made.
We were in compliance with these conditions in 2024 and expect to be in 2025. Issuer Purchases of Equity Securities .
We were in compliance with these conditions in 2025 and expect to be in 2026. Issuer Purchases of Equity Securities .
During each of the quarters in the fiscal year ended December 31, 2024, we paid a quarterly cash dividend of $0.413 per common share to our shareholders.
During each of the quarters in the fiscal year ended December 31, 2025, we paid a quarterly cash dividend of $0.454 per common share to our shareholders.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market, Stockholder, and Dividend Information . Our common stock is listed on the New York Stock Exchange under the symbol “WCC”. As of February 13, 2025, there were 48,795,929 shares of common stock outstanding held by approximately 850 holders of record.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market, Stockholder, and Dividend Information . Our common stock is listed on the New York Stock Exchange under the symbol “WCC”. As of February 12, 2026, there were 48,661,915 shares of common stock outstanding held by approximately 820 holders of record.
These shares were surrendered by stock-based compensation plan participants to satisfy tax withholding obligations arising from the exercise of stock-settled stock appreciation rights and vesting of restricted stock units.
These shares were surrendered by stock-based compensation plan participants to satisfy tax withholding obligations arising from the exercise of stock options and stock-settled stock appreciation rights and vesting of restricted stock units. (2) On May 31, 2022, Wesco's Board of Directors authorized the repurchase of up to $1 billion of the Company’s common stock.
The following stock price performance graph illustrates the five-year cumulative total return on an investment in Wesco International, a 2024 Performance Peer Group, and the Russell 2000 Index.
The following stock price performance graph illustrates the five-year cumulative total return on an investment in Wesco International compared to the Standard & Poor's (“S&P”) MidCap 400 Index, the Dow Jones US Industrial Suppliers Index, the Russell 2000 Index and a self-selected performance peer group.
The following table sets forth all issuer purchases of common stock during the three months ended December 31, 2024: Total Number of Shares Purchased (1) Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs (2) Period (In millions) October 1, 2024 - October 31, 2024 639 $ 182.92 — $ 538.9 November 1, 2024 - November 30, 2024 232,960 $ 207.34 211,854 $ 495.0 December 1, 2024 - December 31, 2024 29,956 $ 209.74 28,697 $ 488.9 Total 263,555 $ 207.55 240,551 (1) There were 23,004 shares purchased during the quarterly period ended December 31, 2024 that were not part of the publicly announced share repurchase program.
The following table sets forth all issuer purchases of common stock during the three months ended December 31, 2025: Total Number of Shares Purchased (1) Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs (2) Period (In millions) October 1, 2025 - October 31, 2025 572 $ 229.08 — $ 413.9 November 1, 2025 - November 30, 2025 4,579 $ 261.44 — $ 413.9 December 1, 2025 - December 31, 2025 59 $ 258.84 — $ 413.9 Total 5,210 $ 257.86 — (1) There were 5,210 shares purchased during the quarterly period ended December 31, 2025 that were not part of the publicly announced share repurchase program.
The graph covers the period from December 31, 2019 to December 31, 2024, and assumes that the value for each investment was $100 on December 31, 2019, and that all dividends were reinvested. 2024 Performance Peer Group: Applied Industrial Technologies, Inc. Fastenal Company Rexel SA Arrow Electronics, Inc. Genuine Parts Company Rockwell Automation, Inc. Avnet, Inc. Hubbell, Inc. W.W.
The graph covers the period from December 31, 2020 to December 31, 2025, and assumes that the value for each investment was $100 on December 31, 2020, and that all dividends were reinvested. (1) The Russell 2000 Index and self-selected performance peer group are being presented for comparative purposes only and will be removed beginning next year.
Grainger, Inc. Barnes Group Inc. MRC Global, Inc. Eaton Corporation Plc MSC Industrial Direct Co., Inc.
(2) The self-selected performance peer group includes the following companies: Applied Industrial Technologies, Inc., Arrow Electronics, Inc., Avnet, Inc., Barnes Group Inc., Eaton Corporation Plc, Fastenal Company, Genuine Parts Company, Hubbell, Inc., MRC Global, Inc., MSC Industrial Direct Co., Inc., Rexel SA, Rockwell Automation, Inc., W.W. Grainger, Inc.
Removed
During the three months ended December 31, 2024, the Company entered into spot repurchase transactions through a broker to purchase 240,551 shares of its common stock in the open market for cash totaling $50.0 million. Wesco funded the repurchases with available cash and borrowings under its accounts receivable securitization and revolving credit facilities. 24 Table of Contents Company Performance.
Added
During the current fiscal year, the Company re-evaluated and decided to discontinue future comparison of its cumulative total shareholder return to the Russell 2000 Index and self-selected performance peer group. This change reflects the Company’s view that the updated indices provide more appropriate, good-faith comparables and better align our reporting with the benchmarks commonly used by our industry peers.
Added
As a result of this change and in accordance with applicable SEC rules, the below graph compares Wesco International's cumulative total shareholder return to both the newly selected indices and the indices used in the immediately preceding fiscal year.

Item 7. Management's Discussion & Analysis

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

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Biggest changeAdjusted EBITDA margin % is calculated by dividing Adjusted EBITDA by net sales. 34 Table of Contents The following tables reconcile selling, general and administrative expenses, income from operations, other non-operating (income) expense, provision for income taxes and earnings per diluted share to adjusted selling, general and administrative expenses, adjusted income from operations, adjusted other non-operating (income) expense, adjusted provision for income taxes and adjusted earnings per diluted share, which are non-GAAP financial measures, for the periods presented: Year Ended December 31, 2024 2023 Adjusted SG&A Expenses: (In millions) Selling, general and administrative expenses $ 3,306.2 $ 3,256.0 Digital transformation costs (1) (24.9) (36.1) Loss on abandonment of assets (2) (17.8) — Restructuring costs (3) (12.1) (16.7) Excise taxes on excess pension plan assets (4) (4.9) — Merger-related and integration costs (5) — (19.3) Adjusted selling, general and administrative expenses $ 3,246.5 $ 3,183.9 Adjusted Income from Operations: Income from operations $ 1,223.2 $ 1,406.4 Digital transformation costs (1) 24.9 36.1 Loss on abandonment of assets (2) 17.8 — Restructuring costs (3) 12.1 16.7 Excise taxes on excess pension plan assets (4) 4.9 — Merger-related and integration costs (5) — 19.3 Accelerated trademark amortization (6) — 1.6 Adjusted income from operations $ 1,282.9 $ 1,480.1 Adjusted Other (Income) Expense, net: Other (income) expense, net $ (92.7) $ 25.1 Gain on divestiture 122.2 — Loss on termination of business arrangement (7) (3.6) — Pension settlement cost (8) (2.5) (2.8) Adjusted other (income) expense, net $ 23.4 $ 22.3 Adjusted Provision for Income Taxes: Provision for income taxes $ 231.6 $ 225.9 Income tax effect of adjustments to income from operations and other (income) expense, net (9) (14.8) 21.0 Adjusted provision for income taxes $ 216.8 $ 246.9 (1) Digital transformation costs include costs associated with certain digital transformation initiatives.
Biggest changeAdjusted EBITDA margin % is calculated by dividing Adjusted EBITDA by net sales. 35 Table of Contents The following tables reconcile SG&A expenses, income from operations, other non-operating (income) expense, provision for income taxes, net income attributable to common stockholders, and earnings per diluted share to adjusted SG&A expenses, adjusted income from operations, adjusted other non-operating (income) expense, adjusted provision for income taxes, adjusted net income attributable to common stockholders, and adjusted earnings per diluted share, which are non-GAAP financial measures, for the periods presented: Year Ended December 31, 2025 2024 Adjusted SG&A Expenses: (In millions) SG&A expenses $ 3,541.4 $ 3,306.2 Digital transformation costs (1) (35.2) (24.9) Restructuring costs (2) — (12.1) Loss on abandonment of assets (3) — (17.8) Excise taxes on excess pension plan assets (4) — (4.9) Adjusted SG&A expenses $ 3,506.2 $ 3,246.5 Adjusted Income from Operations: Income from operations $ 1,233.0 $ 1,223.2 Digital transformation costs (1) 35.2 24.9 Restructuring costs (2) — 12.1 Loss on abandonment of assets (3) — 17.8 Excise taxes on excess pension plan assets (4) — 4.9 Adjusted income from operations $ 1,268.2 $ 1,282.9 Adjusted Other (Income) Expense, net: Other (income) expense, net $ (9.6) $ (92.7) Loss on termination of business arrangement (5) (0.3) (3.6) Pension settlement cost (6) — (2.5) Gain on divestiture — 122.2 Adjusted other (income) expense, net $ (9.9) $ 23.4 Adjusted Provision for Income Taxes: Provision for income taxes $ 213.4 $ 231.6 Income tax effect of adjustments to income from operations and other (income) expense, net (7) 9.5 (14.8) Adjusted provision for income taxes $ 222.9 $ 216.8 Adjusted Net Income Attributable to Common Stockholders: Net income attributable to common stockholders $ 645.8 $ 660.2 Digital transformation costs (1) 35.2 24.9 Restructuring costs (2) — 12.1 Loss on abandonment of assets (3) — 17.8 Excise taxes on excess pension plan assets (4) — 4.9 Gain on divestiture — (122.2) Loss on termination of business arrangement (5) 0.3 3.6 Pension settlement cost (6) — 2.5 Income tax effect of adjustments to income from operations and other (income) expense, net (7) (9.5) 14.8 Gain on redemption of Series A Preferred Stock (32.9) — Adjusted net income attributable to common stockholders $ 638.9 $ 618.6 (1) Digital transformation costs include costs associated with certain digital transformation initiatives.
(2) Loss on abandonment of assets represents the write-off of certain capitalized cloud computing arrangement implementation costs relating to a third-party developed operations management software product in favor of an application with functionality that better suits the Company’s operations. (3) Restructuring costs include severance costs incurred pursuant to an ongoing restructuring plan.
(2) Restructuring costs include severance costs incurred pursuant to an ongoing restructuring plan. (3) Loss on abandonment of assets represents the write-off of certain capitalized cloud computing arrangement implementation costs relating to a third-party developed operations management software product in favor of an application with functionality that better suits the Company’s operations.
Most of these earnings have been taxed in the U.S. under either the one-time tax on the deemed repatriation of undistributed foreign earnings (the “transition tax”), or the global intangible low-taxed income (“GILTI”) tax regime imposed by the Tax Cuts and Jobs Act of 2017.
Most of these earnings have been taxed in the U.S. under either the one-time tax on the deemed repatriation of undistributed foreign earnings (the “transition tax”), or the global intangible low-taxed income (“GILTI”) tax regime imposed by the Tax Cuts and Jobs Act of 2017 (the “TCJA”).
(7) Debt is presented in the Consolidated Balance Sheets net of debt discount and debt issuance costs, and includes adjustments to record the long-term debt assumed in the merger with Anixter at its acquisition date fair value. Note: Financial leverage ratio is a non-GAAP measure of the use of debt.
(6) Debt is presented in the Consolidated Balance Sheets net of debt issuance costs and debt discount, and includes adjustments to record the long-term debt assumed in the merger with Anixter at its acquisition date fair value. Note: Financial leverage ratio is a non-GAAP measure of the use of debt.
(5) Cloud computing arrangement amortization consists of expense recognized in selling, general and administrative expenses for capitalized implementation costs for cloud computing arrangements to support our digital transformation initiatives. (6) Restructuring costs include severance costs incurred pursuant to an ongoing restructuring plan.
(6) Cloud computing arrangement amortization consists of expense recognized in selling, general and administrative expenses for capitalized implementation costs for cloud computing arrangements to support our digital transformation initiatives. (7) Restructuring costs include severance costs incurred pursuant to an ongoing restructuring plan.
We regularly assess the realizability of deferred tax assets. 28 Table of Contents We account for uncertainty in income taxes using a “more-likely-than-not” recognition threshold. Due to the subjectivity inherent in the evaluation of uncertain tax positions, the tax benefit ultimately recognized may materially differ from the estimate recognized in the consolidated financial statements.
We regularly assess the realizability of deferred tax assets. We account for uncertainty in income taxes using a “more-likely-than-not” recognition threshold. Due to the subjectivity inherent in the evaluation of uncertain tax positions, the tax benefit ultimately recognized may materially differ from the estimate recognized in the consolidated financial statements.
Critical Accounting Estimates Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with U.S. GAAP.
Critical Accounting Estimates Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with U.S. GAAP.
These non-GAAP financial measures provide a better understanding of our financial results on a comparable basis. Liquidity and Capital Resources Our liquidity needs generally arise from fluctuations in our working capital requirements, information technology investments, capital expenditures, acquisitions, the payment of dividends, and debt service obligations.
These non-GAAP financial measures provide a better understanding of our financial results on a comparable basis. 37 Table of Contents Liquidity and Capital Resources Our liquidity needs generally arise from fluctuations in our working capital requirements, information technology investments, capital expenditures, acquisitions, the payment of dividends, and debt service obligations.
We recognize interest and penalties related to uncertain tax benefits as part of interest expense and income tax expense, respectively. See Note 2, “Accounting Policies” and Note 11, “Income Taxes” of our Notes to Consolidated Financial Statements for additional disclosure regarding income taxes.
We recognize interest and penalties related to uncertain tax benefits as part of interest expense and income tax expense, respectively. 30 Table of Contents See Note 2, “Accounting Policies” and Note 11, “Income Taxes” of our Notes to Consolidated Financial Statements for additional disclosure regarding income taxes.
Liabilities related to unrecognized tax benefits, including interest and penalties, of $141.0 million were excluded from the table above as we cannot reasonably estimate the timing of these potential cash settlements with taxing authorities. See Note 11, “Income Taxes” of our Notes to Consolidated Financial Statements for further information related to unrecognized tax benefits.
Liabilities related to unrecognized tax benefits, including interest and penalties, of $164.7 million were excluded from the table above as we cannot reasonably estimate the timing of these potential cash settlements with taxing authorities. See Note 11, “Income Taxes” of our Notes to Consolidated Financial Statements for further information related to unrecognized tax benefits.
On an ongoing basis, we evaluate our estimates that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on the financial condition or results of operations, including those related to goodwill and indefinite-lived intangible assets, defined benefit pension plans, and income taxes.
On an ongoing basis, we evaluate our estimates that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on the financial condition or results of operations, including those related to goodwill and indefinite-lived intangible assets and income taxes.
We test for goodwill impairment on a reporting unit level. We have the option to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit or indefinite-lived intangible asset is less than its carrying value as a basis for determining whether it is necessary to perform quantitative impairment tests.
We have the option to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit or indefinite-lived intangible asset is less than its carrying value as a basis for determining whether it is necessary to perform quantitative impairment tests.
Company Overview Wesco, headquartered in Pittsburgh, Pennsylvania, is a leading provider of business-to-business distribution, logistics services and supply chain solutions. We employ approximately 20,000 people, maintain relationships with more than 35,000 suppliers, and serve nearly 140,000 customers worldwide.
Company Overview Wesco, headquartered in Pittsburgh, Pennsylvania, is a leading provider of business-to-business distribution, logistics services and supply chain solutions. We employ approximately 21,000 people, maintain relationships with more than 35,000 suppliers, and serve nearly 130,000 customers worldwide.
(4) Excise taxes on excess pension plan assets represent the excise taxes applicable to the excess pension plan assets following the final settlement of the Company’s U.S. pension plan.
(5) Excise taxes on excess pension plan assets represent the excise taxes applicable to the excess pension plan assets following the final settlement of the Company’s U.S. pension plan.
Future interest rate changes would raise or lower the rates we pay on our variable rate debt and would contribute to fluctuations in interest expense versus prior periods. At December 31, 2024, approximately 60% of our debt portfolio consisted of fixed rate debt.
Future interest rate changes would raise or lower the rates we pay on our variable rate debt and would contribute to fluctuations in interest expense versus prior periods. At December 31, 2025, approximately 66% of our debt portfolio consisted of fixed rate debt.
The distribution of earnings by our foreign subsidiaries in the form of dividends, or otherwise, may be subject to additional taxation. We estimate that additional taxes of approximately $69.4 million would be payable upon the remittance of all previously undistributed foreign earnings as of December 31, 2024, based upon the laws in effect on that date.
The distribution of earnings by our foreign subsidiaries in the form of dividends, or otherwise, may be subject to additional taxation. We estimate that additional taxes of approximately $116.6 million would be payable upon the remittance of all previously undistributed foreign earnings as of December 31, 2025, based upon the laws in effect on that date.
During 2024, financing activities primarily comprised the redemption of our $1,500 million aggregate principal amount of 2025 Notes, proceeds of $900.0 million and $850.0 million related to the issuance of the 2029 Notes and 2032 Notes, respectively, net repayments of $428.0 million related to our Revolving Credit Facility, net repayments of $100.0 million related to our Receivables Facility, and payment of total debt issuance costs of $26.6 million related to the issuance of the 2029 and 2032 Notes and amendments to the Revolving Credit Facility and Receivables Facility.
During 2024, financing activities primarily comprised proceeds of $900.0 million and $850.0 million related to the issuance of the 6.375% senior notes due 2029 and 6.625% senior notes due 2032 (the “2029 and 2032 Notes”), respectively, the redemption of our $1,500.0 million aggregate principal amount of 7.125% Senior Notes due 2025, net repayments of $428.0 million related to our Revolving Credit Facility, net repayments of $100.0 million related to our Receivables Facility, and payment of total debt issuance costs of $26.6 million related to the issuance of the 2029 and 2032 Notes and amendments to the Revolving Credit Facility and Receivables Facility.
We have elected to pay the transition tax in installments over an eight year period, which ends in 2026. As of December 31, 2024, our remaining liability for the transition tax was $37.7 million. We continue to assert that the remaining undistributed earnings of our foreign subsidiaries are indefinitely reinvested.
We have elected to pay the transition tax in installments over an eight year period ending in 2026. As of December 31, 2025, our remaining liability for the transition tax was $13.7 million. We continue to assert that the remaining undistributed earnings of our foreign subsidiaries are indefinitely reinvested.
Fair values are sensitive to changes in underlying assumptions and factors, and as a result there can be no assurance that the estimates and assumptions made for purposes of the annual goodwill and indefinite-lived intangible assets impairment tests will prove to be an accurate prediction of future results.
Management applies its best judgment when assessing the reasonableness of financial projections. Fair values are sensitive to changes in underlying assumptions and factors, and as a result there can be no assurance that the estimates and assumptions made for purposes of the annual goodwill and indefinite-lived intangible assets impairment tests will prove to be an accurate prediction of future results.
Investing activities primarily included $354.9 million in proceeds from the divestiture of the WIS business, net of cash transferred, partially offset by $221.3 million paid in the aggregate to acquire Ascent, the entroCIM business (“entroCIM”), and Independent Electric Supply Inc.
Included in net cash provided by investing activities in 2024 were $354.9 million in proceeds from the divestiture of the WIS business, net of cash transferred, partially offset by $221.3 million paid to acquire Ascent, entroCIM and Independent Electric Supply, net of cash acquired.
Results of Operations 2024 Compared to 2023 Net Sales The following table sets forth net sales and organic sales growth for the periods presented: Year Ended December 31, Growth/(Decline) 2024 2023 Reported Sales Acquisitions/Divestiture Foreign Exchange Workday Organic Sales (In millions) Net sales $ 21,818.8 $ 22,385.2 (2.5) % (2.5) % (0.2) % 0.8 % (0.6) % Note: Organic sales growth is a non-GAAP financial measure of sales performance.
Results of Operations 2025 Compared to 2024 Net Sales The following table sets forth net sales and organic sales growth for the periods presented: Year Ended December 31, Growth/(Decline) 2025 2024 Reported Sales Acquisition/Divestiture Foreign Exchange Workday Organic Sales (In millions) Net sales $ 23,510.9 $ 21,818.8 7.8 % (0.2) % (0.2) % (0.4) % 8.6 % Note: Organic sales growth is a non-GAAP financial measure of sales performance.
As of December 31, 2024, we had $0.6 million outstanding under our international lines of credit. For information regarding amendments to the Receivables Facility and Revolving Credit Facility as well as disclosure of our debt instruments, including our outstanding indebtedness as of December 31, 2024, see Note 9, “Debt” of our Notes to Consolidated Financial Statements.
For information regarding amendments to the Receivables Facility and Revolving Credit Facility as well as disclosure of our debt instruments, including our outstanding indebtedness as of December 31, 2025, see Note 9, “Debt” of our Notes to Consolidated Financial Statements.
During periods of economic expansion or contraction, our sales by quarter have varied significantly from this pattern. Recent Accounting Standards See Note 2, “Accounting Policies” of our Notes to Consolidated Financial Statements for a description of recently adopted and recently issued accounting standards.
Sales typically increase beginning in March, with slight fluctuations per month through October. During periods of economic expansion or contraction, our sales by quarter have varied significantly from this pattern. Recent Accounting Standards See Note 2, “Accounting Policies” of our Notes to Consolidated Financial Statements for a description of recently adopted and recently issued accounting standards.
Net Income and Earnings per Share Net income and earnings per diluted share attributable to common stockholders were $660.2 million and $13.05, respectively, for 2024 compared to $708.1 million and $13.54, respectively, for 2023.
Net Income and Earnings per Share Net income and earnings per diluted share attributable to common stockholders were $645.8 million and $13.05, respectively, for 2025 compared to $660.2 million and $13.05, respectively, for 2024.
The undistributed earnings of our foreign subsidiaries amounted to approximately $2,107.7 million at December 31, 2024.
The undistributed earnings of our foreign subsidiaries amounted to approximately $2,109.2 million at December 31, 2025.
Generally, our purchase orders and contracts contain clauses allowing for cancellation. We do not have significant agreements to purchase material or goods that would specify minimum order quantities.
Purchase orders for inventory requirements and service contracts are not included in the table above. Generally, our purchase orders and contracts contain clauses allowing for cancellation. We do not have agreements to purchase material or goods that would specify significant minimum order quantities.
(9) The adjustments to income from operations and other (income) expense, net for the years ended December 31, 2024 and 2023 have been tax effected at rates of 26.2% and 27.5%, respectively. 35 Table of Contents Year Ended December 31, Adjusted Earnings Per Diluted Share: 2024 2023 (In millions, except per share data) Adjusted income from operations $ 1,282.9 $ 1,480.1 Interest expense, net 364.9 389.3 Adjusted other expense, net 23.4 22.3 Adjusted income before income taxes 894.6 1,068.5 Adjusted provision for income taxes 216.8 246.9 Adjusted net income 677.8 821.6 Net income attributable to noncontrolling interests 1.8 0.6 Adjusted net income attributable to WESCO International, Inc. 676.0 821.0 Preferred stock dividends 57.4 57.4 Adjusted net income attributable to common stockholders $ 618.6 $ 763.6 Diluted shares 50.6 52.3 Adjusted earnings per diluted share $ 12.23 $ 14.60 Note: For the year ended December 31, 2024, SG&A expenses, income from operations, other non-operating (income) expense, the provision for income taxes and earnings per diluted share have been adjusted to exclude digital transformation costs, the loss on abandonment of assets, restructuring costs, excise taxes on excess pension plan assets, the gain recognized on the divestiture of the WIS business, the loss on termination of business arrangement, pension settlement cost, and the related income tax effects.
(7) The adjustments to income from operations and other (income) expense, net for the years ended December 31, 2025 and 2024 have been tax effected at rates of 26.6% and 26.2%, respectively. 36 Table of Contents Year Ended December 31, Adjusted Earnings Per Diluted Share: 2025 2024 (In millions, except per share data) Adjusted income from operations $ 1,268.2 $ 1,282.9 Interest expense, net 386.7 364.9 Adjusted other (income) expense, net (9.9) 23.4 Adjusted income before income taxes 891.4 894.6 Adjusted provision for income taxes 222.9 216.8 Adjusted net income 668.5 677.8 Net income attributable to noncontrolling interests 2.3 1.8 Adjusted net income attributable to WESCO International, Inc. 666.2 676.0 Preferred stock dividends 27.3 57.4 Adjusted net income attributable to common stockholders $ 638.9 $ 618.6 Diluted shares 49.5 50.6 Adjusted earnings per diluted share $ 12.91 $ 12.23 Note: For the year ended December 31, 2025, SG&A expenses, income from operations, other non-operating (income) expense, the provision for income taxes, net income attributable to common stockholders, and earnings per diluted share have been adjusted to exclude digital transformation costs, restructuring costs, the loss on termination of business arrangement, and the related income tax effects, and the gain on redemption of the Company's Series A Preferred Stock.
Adjusted for digital transformation costs, the loss on abandonment of assets, restructuring costs, excise taxes on excess pension plan assets, the gain recognized on the divestiture of the WIS business, the loss on termination of a business arrangement, pension settlement cost, and the related income tax effects, net income and earnings per diluted share attributable to common stockholders were $618.6 million and $12.23, respectively, for the year ended December 31, 2024.
For the year ended December 31, 2024, SG&A expenses, income from operations, other non-operating (income) expense, the provision for income taxes, net income attributable to common stockholders, and earnings per diluted share have been adjusted to exclude digital transformation costs, the loss on abandonment of assets, restructuring costs, excise taxes on excess pension plan assets, the gain recognized on the divestiture of the WIS business, the loss on termination of business arrangement, pension settlement cost, and the related income tax effects.
See Note 2, “Accounting Policies” and Note 13, “Employee Benefit Plans” of our Notes to Consolidated Financial Statements for additional disclosure regarding defined benefit pension plans. Income Taxes We recognize deferred tax assets consistent with amounts expected to be realized.
See Note 2, “Accounting Policies” and Note 6, “Goodwill and Intangible Assets” of our Notes to Consolidated Financial Statements for additional disclosure regarding goodwill and indefinite-lived intangible assets. Income Taxes We recognize deferred tax assets consistent with amounts expected to be realized.
The following table sets forth our financial leverage ratio, which is a non-GAAP financial measure, for the periods presented: Twelve months ended December 31, 2024 December 31, 2023 (In millions of dollars, except ratios) Net income attributable to common stockholders $ 660.2 $ 708.1 Net income attributable to noncontrolling interests 1.8 0.6 Preferred stock dividends 57.4 57.4 Provision for income taxes 231.6 225.9 Interest expense, net 364.9 389.3 Depreciation and amortization 183.2 181.3 EBITDA $ 1,499.1 $ 1,562.6 Other (income) expense, net (92.7) 25.1 Stock-based compensation expense 28.9 45.5 Merger-related and integration costs (1) — 19.3 Restructuring costs (2) 12.1 16.7 Digital transformation costs (3) 24.9 36.1 Excise taxes on excess pension plan assets (4) 4.9 — Loss on abandonment of assets (5) 17.8 — Cloud computing arrangement amortization (6) 14.1 — Adjusted EBITDA $ 1,509.1 $ 1,705.3 As of December 31, 2024 December 31, 2023 Short-term debt and current portion of long-term debt, net $ 19.5 $ 8.6 Long-term debt, net 5,045.5 5,313.1 Debt discount and debt issuance costs (7) 47.2 43.0 Fair value adjustments to the Anixter Senior Notes (7) (0.1) (0.1) Total debt 5,112.1 5,364.6 Less: Cash and cash equivalents 702.6 524.1 Total debt, net of cash $ 4,409.5 $ 4,840.5 Financial leverage ratio 2.9 2.8 (1) Merger-related and integration costs include integration and professional fees associated with the integration of Wesco and Anixter, as well as advisory, legal, and separation costs associated with the merger between the two companies.
We also measure our ability to meet our debt obligations based on our financial leverage ratio, which was 3.4x as of December 31, 2025 and 2.9x as of December 31, 2024. 38 Table of Contents The following table sets forth our financial leverage ratio, which is a non-GAAP financial measure, for the periods presented: Twelve months ended December 31, 2025 December 31, 2024 (In millions of dollars, except ratios) Net income attributable to common stockholders $ 645.8 $ 660.2 Net income attributable to noncontrolling interests 2.3 1.8 Gain on redemption of Series A Preferred Stock (32.9) — Preferred stock dividends 27.3 57.4 Provision for income taxes 213.4 231.6 Interest expense, net 386.7 364.9 Depreciation and amortization 197.6 183.2 EBITDA $ 1,440.2 $ 1,499.1 Other income, net (9.6) (92.7) Stock-based compensation expense 40.5 28.9 Digital transformation costs (1) 35.2 24.9 Cloud computing arrangement amortization (2) 30.2 14.1 Restructuring costs (3) — 12.1 Loss on abandonment of assets (4) — 17.8 Excise taxes on excess pension plan assets (5) — 4.9 Adjusted EBITDA $ 1,536.5 $ 1,509.1 As of December 31, 2025 December 31, 2024 Short-term debt and current portion of long-term debt, net $ 25.0 $ 19.5 Long-term debt, net 5,756.4 5,045.5 Debt discount and debt issuance costs (6) 48.0 47.2 Fair value adjustments to the Anixter Senior Notes (6) — (0.1) Total debt 5,829.4 5,112.1 Less: Cash and cash equivalents 604.8 702.6 Total debt, net of cash $ 5,224.6 $ 4,409.5 Financial leverage ratio 3.4 2.9 (1) Digital transformation costs include costs associated with certain digital transformation initiatives.
As described in Note 9, “Debt” of our Notes to Consolidated Financial Statements, on March 7, 2024, Wesco Distribution issued $900 million aggregate principal amount of 2029 Notes and $850 million aggregate principal amount of 2032 Notes.
As described in Note 9, “Debt” of our Notes to Consolidated Financial Statements, on March 6, 2025, Wesco Distribution issued $800 million aggregate principal amount of 2033 Notes.
(5) Loss on abandonment of assets represents the write-off of certain capitalized cloud computing arrangement implementation costs relating to a third-party developed operations management software product in favor of an application with functionality that better suits the Company’s operations. 37 Table of Contents (6) Cloud computing arrangement amortization consists of expense recognized in selling, general and administrative expenses for capitalized implementation costs for cloud computing arrangements to support our digital transformation initiatives.
(4) Digital transformation costs include costs associated with certain digital transformation initiatives. (5) Loss on abandonment of assets represents the write-off of certain capitalized cloud computing arrangement implementation costs relating to a third-party developed operations management software product in favor of an application with functionality that better suits the Company's operations.
Financing activities for 2024 also included $425.0 million of common stock repurchases, $81.5 million and $57.4 million of dividends paid to holders of our common stock and Series A Preferred Stock, respectively, and $30.9 million of payments for taxes related to the exercise and vesting of stock-based awards.
Financing activities for 2025 also included $540.3 million paid to redeem our Series A Preferred Stock, $75.0 million of common stock repurchases, $88.4 million and $27.3 million of dividends paid to holders of our common stock and Series A Preferred Stock, respectively, and $37.2 million of payments for taxes related to the exercise and vesting of stock-based awards.
Financial leverage ratio is calculated by dividing total debt, excluding debt discount, debt issuance costs and fair value adjustments, net of cash, by adjusted EBITDA. EBITDA is defined as the trailing twelve months earnings before interest, taxes, depreciation and amortization.
Financial leverage ratio is calculated by dividing total debt, excluding debt issuance costs, debt discount and fair value adjustments, net of cash, by adjusted EBITDA.
The maximum borrowing limits of our international lines of credit vary by facility and range between $0.6 million and $9.5 million. Our international lines of credit generally are renewable on an annual basis and certain facilities are fully and unconditionally guaranteed by Wesco Distribution. Accordingly, certain borrowings under these lines directly reduce availability under our Revolving Credit Facility.
The Revolving Credit Facility has a borrowing limit of $1,725 million and the purchase limit under the Receivables Facility is $1,550 million. Our international lines of credit generally are renewable on an annual basis and certain facilities are fully and unconditionally guaranteed by Wesco Distribution. Accordingly, certain borrowings under these lines directly reduce availability under our Revolving Credit Facility.
We operate more than 700 sites, including distribution centers, fulfillment centers, and sales offices, in approximately 50 countries, providing a local presence for customers and a global network to serve multi-location businesses and global corporations.
We operate more than 700 sites, including distribution centers, fulfillment centers and sales offices, in approximately 50 countries, providing a local presence for customers and a global network to serve multi-location businesses and global corporations. We have operating segments comprising three strategic business units: Electrical & Electronic Solutions (“EES”), Communications & Security Solutions (“CSS”) and Utility & Broadband Solutions (“UBS”).
Workday impact represents the change in the number of operating days period-over-period after adjusting for weekends and public holidays in the United States; 2024 had two more workdays compared to 2023. Net sales were $21.8 billion for 2024 compared to $22.4 billion for 2023, a decrease of 2.5%.
Workday impact represents the change in the number of operating days period-over-period after adjusting for weekends and public holidays in the United States; 2025 had one less workday compared to 2024. Net sales were $23.5 billion for 2025 compared to $21.8 billion for 2024, an increase of 7.8%. Organic sales for 2025 grew by 8.6%.
Note: Adjusted EBITDA and Adjusted EBITDA margin % are non-GAAP financial measures that provide indicators of the Company’s performance and its ability to meet debt service requirements.
(8) Excise taxes on excess pension plan assets represent the excise taxes applicable to the excess pension plan assets following the final settlement of the Company's U.S. pension plan. Note: Adjusted EBITDA and Adjusted EBITDA margin % are non-GAAP financial measures that provide indicators of the Company’s performance and its ability to meet debt service requirements.
In 2024, we completed the divestiture of our WIS business and recognized a gain from the sale of $122.2 million. Due to fluctuations in the U.S. dollar against certain foreign currencies, we recognized a net foreign currency exchange loss of $25.5 million for 2024 compared to a net loss of $22.9 million for 2023.
Due to fluctuations in the U.S. dollar against certain foreign currencies, we recognized a net foreign currency exchange loss of $0.3 million for 2025 compared to a net loss of $25.5 million for 2024.
Communications & Security Solutions Year Ended December 31, Growth/(Decline) 2024 2023 Reported Sales Acquisitions Foreign Exchange Workday Organic Sales (In millions) Net sales $ 7,537.0 $ 7,152.2 5.4 % 0.5 % (0.2) % 0.8 % 4.3 % Adjusted EBITDA $ 621.1 $ 683.8 Adjusted EBITDA margin % 8.2 % 9.6 % CSS reported net sales of $7.5 billion for 2024 compared to $7.2 billion for 2023, an increase of 5.4%.
Electrical & Electronic Solutions Year Ended December 31, Growth/(Decline) 2025 2024 Reported Sales Acquisition Foreign Exchange Workday Organic Sales (In millions) Net sales $ 8,955.5 $ 8,391.7 6.7 % — % (0.4) % (0.4) % 7.5 % Adjusted EBITDA $ 717.6 $ 699.8 Adjusted EBITDA margin % 8.0 % 8.3 % EES reported net sales of $9.0 billion for 2025 compared to $8.4 billion for 2024, an increase of $563.8 million, or 6.7%.
Cash included in our determination of liquidity represents cash in certain deposit and interest-bearing investment accounts held in the United States and Canada. We monitor the depository institutions that hold our cash and cash equivalents on a regular basis, and we believe that we have placed our deposits with creditworthy financial institutions.
We monitor the depository institutions that hold our cash and cash equivalents on a regular basis, and we believe that we have placed our deposits with creditworthy financial institutions.
Segment Results The following is a discussion of the financial results of our operating segments comprising three strategic business units consisting of EES, CSS and UBS for the year ended December 31, 2024.
There was also a decrease in restructuring costs of $12.1 million in 2025, partially offset by a $10.3 million increase in digital transformation costs. Segment Results The following is a discussion of the financial results of our operating segments comprising three strategic business units consisting of EES, CSS and UBS for the year ended December 31, 2025.
As further described below and in Note 16, “Business Segments” of our Notes to Consolidated Financial Statements, the performance of our operating segments is based on net sales, adjusted EBITDA, and adjusted EBITDA margin percentage.
As further described below and in Note 16, “Business Segments” of our Notes to Consolidated Financial Statements, the Chief Operating Decision Maker (the “CODM”) allocates resources and evaluates the performance of the Company’s reportable segments based on adjusted EBITDA, which is the Company’s measure of segment profit or loss. Adjusted EBITDA and adjusted EBITDA margin percentage are non-GAAP financial measures.
Capital expenditures in 2024 and 2023 primarily comprised internal-use computer software and information technology hardware to support our digital transformation initiatives, as well as equipment and leasehold improvements to support our global network of distribution centers, fulfillment centers, and sales offices. Financing Activities Net cash used in financing activities in 2024 was $928.3 million, compared to $403.9 million in 2023.
Capital expenditures in 2025 and 2024 primarily comprised equipment and leasehold improvements to support our global network of locations, and internal-use computer software and information technology hardware to support our digital transformation initiatives. Net cash used in investing activities in 2025 also included $36.3 million paid to acquire Industrial Software Solutions, net of cash acquired.
As of December 31, 2024, we had approximately $1.2 billion in available borrowing capacity under our Revolving Credit Facility, after giving effect to outstanding letters of credit and certain borrowings under our international lines of credit, and $100.0 million of available borrowing capacity under our Receivables Facility, which combined with available cash of $383.0 million, provided liquidity of approximately $1.7 billion.
As of December 31, 2025, we had $581.5 million outstanding and $1,107.9 million in available borrowing capacity on the Revolving Credit Facility after giving effect to outstanding letters of credit and certain borrowings under our international lines of credit.
For the year ended December 31, 2024, we elected to bypass the qualitative assessments and performed annual quantitative impairment tests of goodwill and indefinite-lived intangible assets during the fourth quarter of 2024 by comparing the fair values of our reporting units and indefinite-lived intangible assets to their carrying values.
For the year ended December 31, 2025, we performed annual impairment tests of goodwill and indefinite-lived intangible assets during the fourth quarter of 2025 by assessing the above-mentioned qualitative factors.
SG&A expenses decreased $21.1 million as compared to the prior year, which was primarily attributed to a decrease in commissions and incentives of $17.0 million, driven by lower sales volume and the impact of the WIS divestiture. 32 Table of Contents The following tables reconcile net income attributable to common stockholders to adjusted EBITDA and adjusted EBITDA margin % by segment, which are non-GAAP financial measures, for the periods presented: Year Ended December 31, 2024 (In millions) EES CSS UBS Corporate Total Net income attributable to common stockholders $ 656.9 $ 480.9 $ 733.0 $ (1,210.6) $ 660.2 Net (loss) income attributable to noncontrolling interests (1.1) 2.3 — 0.6 1.8 Preferred stock dividends — — — 57.4 57.4 Provision for income taxes (1) — — — 231.6 231.6 Interest expense, net (1) — — — 364.9 364.9 Depreciation and amortization 46.8 71.5 28.5 36.4 183.2 Other expense (income), net (2) 10.5 59.8 (121.2) (41.8) (92.7) Stock-based compensation expense 4.4 6.6 3.1 14.8 28.9 Digital transformation costs (3) — — — 24.9 24.9 Loss on abandonment of assets (4) — — — 17.8 17.8 Cloud computing arrangement amortization (5) — — — 14.1 14.1 Restructuring costs (6) — — — 12.1 12.1 Excise taxes on excess pension plan assets (7) — — — 4.9 4.9 Adjusted EBITDA $ 717.5 $ 621.1 $ 643.4 $ (472.9) $ 1,509.1 Adjusted EBITDA margin % 8.4 % 8.2 % 11.2 % (1) The reportable segments do not incur income taxes and interest expense as these costs are centrally controlled through the Corporate tax and treasury functions.
(3) Cloud computing arrangement amortization consists of expense recognized in selling, general and administrative expenses for capitalized implementation costs for cloud computing arrangements to support our digital transformation initiatives. 34 Table of Contents Year Ended December 31, 2024 (In millions) EES (1) CSS (1) UBS Corporate Total Net income attributable to common stockholders $ 641.0 $ 496.8 $ 733.0 $ (1,210.6) $ 660.2 Net (loss) income attributable to noncontrolling interests (1.1) 2.3 — 0.6 1.8 Preferred stock dividends — — — 57.4 57.4 Provision for income taxes (2) — — — 231.6 231.6 Interest expense, net (2) — — — 364.9 364.9 Depreciation and amortization 46.4 71.9 28.5 36.4 183.2 Other expense (income), net (3) 9.1 61.2 (121.2) (41.8) (92.7) Stock-based compensation expense 4.4 6.6 3.1 14.8 28.9 Digital transformation costs (4) — — — 24.9 24.9 Loss on abandonment of assets (5) — — — 17.8 17.8 Cloud computing arrangement amortization (6) — — — 14.1 14.1 Restructuring costs (7) — — — 12.1 12.1 Excise taxes on excess pension plan assets (8) — — — 4.9 4.9 Adjusted EBITDA $ 699.8 $ 638.8 $ 643.4 $ (472.9) $ 1,509.1 Adjusted EBITDA margin % 8.3 % 8.3 % 11.2 % (1) As described in Note 2, “Accounting Policies,” the reportable segment information for the year ended December 31, 2024 for the EES and CSS reportable segments has been recast to conform to the current year presentation.
(4) Excise taxes on excess pension plan assets represent the excise taxes applicable to the excess pension plan assets following the final settlement of the Company’s U.S. pension plan.
(4) Excise taxes on excess pension plan assets represent the excise taxes applicable to the excess pension plan assets following the final settlement of the Company’s U.S. pension plan. (5) Loss on termination of business arrangement represents the loss recognized as a result of management’s decision to terminate a business arrangement with a third party.
Over the next several quarters, we expect that our excess liquidity will be directed primarily at returning capital to shareholders through our existing share repurchase authorization, the payment of dividends, debt reduction, digital transformation initiatives, potential acquisitions and related integration activities, and/or the redemption of Series A Preferred Stock.
We believe our capital structure has an appropriate mix of fixed versus variable rate debt and secured versus unsecured instruments. Over the next several quarters, we expect that our excess liquidity will be directed primarily at debt reduction, the payment of dividends, share repurchases, digital transformation initiatives, and potential acquisitions and related integration activities.
The increase in SG&A expenses is primarily attributed to increased commissions and incentives of $13.5 million, higher salaries of $11.5 million, higher costs to operate our facilities of $5.5 million, which includes an increase in rents and the opening of a new facility, higher benefits expense of $5.4 million, and higher professional and consulting fees of $5.3 million. 31 Table of Contents Utility & Broadband Solutions Year Ended December 31, Growth/(Decline) 2024 2023 Reported Divestiture Foreign Exchange Workday Organic Sales (In millions) Net sales $ 5,735.0 $ 6,622.7 (13.4) % (8.9) % (0.1) % 0.8 % (5.2) % Adjusted EBITDA $ 643.4 $ 739.3 Adjusted EBITDA margin % 11.2 % 11.2 % UBS reported net sales of $5.7 billion for 2024 compared to $6.6 billion for 2023, a decrease of 13.4%.
Utility & Broadband Solutions Year Ended December 31, Growth/(Decline) 2025 2024 Reported Sales Divestiture Foreign Exchange Workday Organic Sales (In millions) Net sales $ 5,454.4 $ 5,735.0 (4.9) % (3.3) % (0.2) % (0.4) % (1.0) % Adjusted EBITDA $ 562.8 $ 643.4 Adjusted EBITDA margin % 10.3 % 11.2 % UBS reported net sales of $5.5 billion for 2025 compared to $5.7 billion for 2024, a decrease of $280.6 million or 4.9%, which is inclusive of an unfavorable impact from the divestiture of the WIS business of 3.3%.
Seasonality Our operating results are not significantly affected by seasonal factors. Sales during the first and fourth quarters have historically been affected by a reduced level of activity primarily due to the impact of weather on projects. Sales typically increase beginning in March, with slight fluctuations per month through October.
We believe that we are able to maintain sufficient liquidity for our domestic operations and commitments without repatriating cash from our foreign subsidiaries. Seasonality Our operating results are not significantly affected by seasonal factors. Sales during the first and fourth quarters have historically been affected by a reduced level of activity primarily due to the impact of weather on projects.
We believe the following accounting estimates are the most critical to the understanding of our consolidated financial statements as they require subjective or complex judgments by management. 27 Table of Contents Goodwill and Indefinite-Lived Intangible Assets Goodwill and indefinite-lived intangible assets are tested for impairment annually as of October 1, or more frequently if triggering events occur, indicating that their carrying values may not be recoverable.
Goodwill and Indefinite-Lived Intangible Assets Goodwill and indefinite-lived intangible assets are tested for impairment annually as of October 1, or more frequently if triggering events occur, indicating that their carrying values may not be recoverable. We test for goodwill impairment on a reporting unit level.
Investing Activities Net cash provided by investing activities in 2024 was $40.4 million compared to $89.6 million used in investing activities in 2023.
Investing Activities Net cash used in investing activities in 2025 was $140.7 million compared to $40.4 million provided by investing activities in 2024. Included in 2025 were capital expenditures of $99.8 million compared to $94.7 million in 2024.
We expect to fund future uses of cash with a combination of existing cash balances, cash generated from operating activities, borrowings under our revolving credit and accounts receivable securitization facilities, or new issuances of debt. Purchase orders for inventory requirements and service contracts are not included in the table above.
We expect to spend approximately $100 million in 2026 on capital expenditures for information technology investments and to support our global network of distribution centers, fulfillment centers and sales offices. 40 Table of Contents We expect to fund future uses of cash with a combination of existing cash balances, cash generated from operating activities, borrowings under our revolving credit and accounts receivable securitization facilities, or new issuances of debt.
Additionally, financing activities comprised net repayments of $428.0 million related to our revolving credit facility (the “Revolving Credit Facility”), net repayments of $100.0 million related to our accounts receivable securitization facility (the “Receivables Facility”), and payment of total debt issuance costs of $26.6 million related to the issuance of the 2029 and 2032 Notes and amendments to the Revolving Credit Facility and Receivables Facility.
During 2025, financing activities primarily comprised proceeds of $800 million related to the issuance of the 2033 Notes, net borrowings of $54.8 million related to our Revolving Credit Facility, net repayments of $150.0 million related to our Receivables Facility, and payment of total debt issuance costs of $14.0 million related to the issuance of the 2033 Notes and amendments to the Revolving Credit Facility and Receivables Facility.
(2) Other income for the UBS segment includes the gain on the divestiture of the WIS business as disclosed in Note 5, “Acquisitions and Divestitures”. (3) Digital transformation costs include costs associated with certain digital transformation initiatives.
(2) The reportable segments do not incur income taxes and interest expense as these costs are centrally controlled through the Corporate tax and treasury functions. (3) Other income for the UBS segment includes the gain on the divestiture of the WIS business as disclosed in Note 5, “Acquisitions and Divestitures”.
Economic conditions contributed to increases in interest rates during 2023; however, interest rates have remained stable in 2024, and the Federal Reserve reduced its benchmark interest rate by a total of 100 basis points in the second half of 2024.
Interest rates remained stable in the first half of 2025 before the Federal Reserve reacted to economic conditions and reduced its benchmark interest rate at the end of the third quarter and twice more in the fourth quarter by 25 basis points, respectively, for a total reduction of 75 basis points in the second half of 2025.
The following table summarizes our material cash requirements from known contractual and other obligations at December 31, 2024, including interest, and the expected effect on our liquidity and cash flow in future periods: 2025 2026 to 2027 2028 to 2029 2030 - After Total (In millions) Debt, excluding debt discount and debt issuance costs $ 19.5 $ 2,001.4 $ 2,238.1 $ 853.1 $ 5,112.1 Interest on indebtedness (1) 319.8 557.4 233.8 127.0 1,238.0 Non-cancelable operating leases 205.2 328.4 199.9 161.7 895.2 Transition tax installments 24.0 13.7 — — 37.7 Defined benefit pension plans (2) 7.1 — — — 7.1 Total $ 575.6 $ 2,900.9 $ 2,671.8 $ 1,141.8 $ 7,290.1 (1) Interest on variable rate debt was calculated using the rates and balances outstanding at December 31, 2024.
The following table summarizes our material cash requirements from known contractual and other obligations at December 31, 2025, including interest, and the expected effect on our liquidity and cash flow in future periods: 2026 2027 to 2028 2029 to 2030 2031 - After Total (In millions) Debt, excluding debt discount and debt issuance costs (1) $ 25.0 $ 2,655.1 $ 1,497.2 $ 1,652.1 $ 5,829.4 Interest on indebtedness (1)(2) 356.4 608.7 278.3 218.4 1,461.8 Non-cancelable operating leases 243.4 393.9 248.2 215.6 1,101.1 Transition tax installments 13.7 — — — 13.7 Total $ 638.5 $ 3,657.7 $ 2,023.7 $ 2,086.1 $ 8,406.0 (1) Debt payments include both principal and interest payments on debt and finance lease obligations.
With millions of products, end-to-end supply chain services, and leading digital capabilities, we provide innovative solutions to meet customer needs across commercial and industrial businesses, contractors, government agencies, educational institutions, telecommunications providers, utilities, and technology companies.
With millions of products, end-to-end supply chain services, and significant digital capabilities, Wesco provides innovative solutions to meet customer needs across commercial and industrial businesses, technology companies, telecommunications providers, and utilities. Our innovative solutions include supply chain management, logistics and transportation, procurement, warehousing and inventory management, as well as kitting and labeling, limited assembly of products and installation enhancement.
An analysis of cash flows for 2024 and 2023 follows: Operating Activities Net cash provided by operating activities for 2024 totaled $1,101.2 million, compared to $493.2 million of cash generated in 2023.
EBITDA is defined as the trailing twelve months earnings before interest, taxes, depreciation and amortization. 39 Table of Contents An analysis of cash flows for 2025 and 2024 follows: Operating Activities Net cash provided by operating activities for 2025 totaled $125.0 million, compared to $1,101.2 million in 2024.
If actual market conditions are less favorable than those projected by management, additional adjustments to reserve items may be required.
If actual market conditions are less favorable than those projected by management, additional adjustments to reserve items may be required. We believe the following accounting estimates are the most critical to the understanding of our consolidated financial statements as they require subjective or complex judgments by management.
Cost of Goods Sold Cost of goods sold for 2024 was $17.1 billion compared to $17.5 billion for 2023, a decrease of $0.4 billion. Cost of goods sold as a percentage of net sales was 78.4% for the current and prior year.
Cost of goods sold as a percentage of net sales was 78.9% and 78.4% for 2025 and 2024, respectively.
Due to the future impact of various market conditions, rates of return and changes in plan participants, we cannot provide a meaningful estimate of our future contributions beyond 2025. 39 Table of Contents In addition to the cash requirements disclosed in the table above, we expect future uses of cash to include working capital requirements, capital expenditures, investments in our digital capabilities, dividend payments to holders of our common stock and Series A Preferred Stock, benefit payments to participants in our deferred compensation plan, and other organic opportunities.
(2) Interest on variable rate debt was calculated using the rates and balances outstanding at December 31, 2025. In addition to the cash requirements disclosed in the table above, we expect future uses of cash to include working capital requirements, capital expenditures, investments in our digital capabilities, dividend payments to holders of our common stock, and other organic opportunities.
We have operating segments comprising three strategic business units consisting of Electrical & Electronic Solutions (“EES”), Communications & Security Solutions (“CSS”) and Utility & Broadband Solutions (“UBS”). These operating segments are equivalent to our reportable segments. See Item 1, “Business” in this Annual Report on Form 10-K for a description of each of our reportable segments and their business activities.
These operating segments are equivalent to our reportable segments. See Item 1, “Business” in this Annual Report on Form 10-K for a description of each of our reportable segments and their business activities. Business Highlights Our financial results reflect strong sales in 2025, highlighted by a 7.8% year-over-year increase in reported net sales.
As a result of these assessments, we determined that the fair values of our reporting units and indefinite-lived intangible assets continue to exceed their respective carrying amounts. The determination of fair value involves significant management judgment, particularly as it relates to the underlying assumptions and factors around future expected revenues, operating margins and discount rate.
As it pertains to a quantitative impairment test, the determination of fair value involves significant management judgment, particularly as it relates to the underlying assumptions and factors around future expected revenues, operating margins and discount rate. This involves performing sensitivity analyses around certain of these assumptions in order to assess the reasonableness of the assumptions and resulting estimated fair values.
(7) Excise taxes on excess pension plan assets represent the excise taxes applicable to the excess pension plan assets following the final settlement of the Company’s U.S. pension plan. 33 Table of Contents Year Ended December 31, 2023 (In millions) EES CSS UBS Corporate Total Net income attributable to common stockholders $ 668.7 $ 531.1 $ 712.5 $ (1,204.2) $ 708.1 Net (loss) income attributable to noncontrolling interests (0.5) 1.6 — (0.5) 0.6 Preferred stock dividends — — — 57.4 57.4 Provision for income taxes (1) — — — 225.9 225.9 Interest expense, net (1) — — — 389.3 389.3 Depreciation and amortization 43.3 71.7 25.0 41.3 181.3 Other expense (income), net 10.1 74.2 (1.4) (57.8) 25.1 Stock-based compensation expense (2) 5.8 5.2 3.2 31.3 45.5 Digital transformation costs (3) — — — 36.1 36.1 Merger-related and integration costs (4) — — — 19.3 19.3 Restructuring costs (5) — — — 16.7 16.7 Adjusted EBITDA $ 727.4 $ 683.8 $ 739.3 $ (445.2) $ 1,705.3 Adjusted EBITDA margin % 8.4 % 9.6 % 11.2 % (1) The reportable segments do not incur income taxes and interest expense as these costs are centrally controlled through the Corporate tax and treasury functions.
The following tables reconcile net income attributable to common stockholders to adjusted EBITDA and adjusted EBITDA margin % by segment, which are non-GAAP financial measures, for the periods presented: Year Ended December 31, 2025 (In millions) EES CSS UBS Corporate Total Net income attributable to common stockholders $ 646.5 $ 649.1 $ 531.0 $ (1,180.8) $ 645.8 Net income (loss) income attributable to noncontrolling interests 0.5 2.9 — (1.1) 2.3 Gain on redemption of Series A Preferred Stock — — — (32.9) (32.9) Preferred stock dividends — — — 27.3 27.3 Provision for income taxes (1) — — — 213.4 213.4 Interest expense, net (1) — — — 386.7 386.7 Depreciation and amortization 50.5 77.7 32.6 36.8 197.6 Other expense (income), net 16.0 64.4 (2.6) (87.4) (9.6) Stock-based compensation expense 4.1 5.3 1.8 29.3 40.5 Digital transformation costs (2) — — — 35.2 35.2 Cloud computing arrangement amortization (3) — — — 30.2 30.2 Adjusted EBITDA $ 717.6 $ 799.4 $ 562.8 $ (543.3) $ 1,536.5 Adjusted EBITDA margin % 8.0 % 8.8 % 10.3 % (1) The reportable segments do not incur income taxes and interest expense as these costs are centrally controlled through the Corporate tax and treasury functions.
We believe cash provided by operations and financing activities will be adequate to cover our operational and business needs for at least the next twelve months. 36 Table of Contents We communicate on a regular basis with our lenders regarding our financial and working capital performance, and liquidity position.
While we did not face significant challenges with our sources or uses of cash in 2025, future market disruptions could occur which could potentially affect our liquidity. We believe cash provided by operations and financing activities will be adequate to cover our operational and business needs for at least the next twelve months.
(8) For the year ended December 31, 2024, pension settlement cost represents expense related to the settlement of the Company’s U.S. pension plan. For the year ended December 31, 2023, pension settlement cost represents expense related to the partial settlement of the Company’s U.S. pension plan, partially offset by pension settlement gains related to other plans.
(6) Pension settlement cost represents expense related to the settlement of the Company’s U.S. pension plan.
The decline in volume was partially offset by the impact of changes in price, which favorably impacted organic sales by approximately 1%. EES reported adjusted EBITDA of $717.5 million for 2024, or 8.4% of net sales, compared to $727.4 million for 2023, or 8.4% of net sales. Adjusted EBITDA decreased $9.9 million, or 1.4% year-over-year.
EES organic sales for 2025 grew by 7.5%, driven primarily by volume growth of approximately 4%, primarily as a result of growth in the OEM and construction businesses, and by the impact of changes in price, which favorably impacted organic sales by approximately 4%. EES adjusted EBITDA increased $17.8 million, or 2.5% year-over-year.
Adjusted EBITDA and adjusted EBITDA margin percentage are non-GAAP financial measures. 30 Table of Contents Electrical & Electronic Solutions Year Ended December 31, Growth/(Decline) 2024 2023 Reported Sales Acquisition Foreign Exchange Workday Organic Sales (In millions) Net sales $ 8,546.8 $ 8,610.3 (0.7) % — % (0.5) % 0.8 % (1.0) % Adjusted EBITDA $ 717.5 $ 727.4 Adjusted EBITDA margin % 8.4 % 8.4 % EES reported net sales of $8.5 billion for 2024 compared to $8.6 billion for 2023, a decrease of 0.7%.
Communications & Security Solutions Year Ended December 31, Growth/(Decline) 2025 2024 Reported Sales Acquisition Foreign Exchange Workday Organic Sales (In millions) Net sales $ 9,101.0 $ 7,692.1 18.3 % 1.9 % 0.1 % (0.4) % 16.7 % Adjusted EBITDA $ 799.4 $ 638.8 Adjusted EBITDA margin % 8.8 % 8.3 % CSS reported net sales of $9.1 billion for 2025 compared to $7.7 billion for 2024, an increase of $1.4 billion, or 18.3%, which is inclusive of a favorable impact from the acquisition of Ascent of 1.9%.
We expect to maintain sufficient liquidity through our credit facilities and cash balances.
We expect to maintain sufficient liquidity through our credit facilities and cash balances. We continue to monitor the sufficiency of our liquidity given the potential impact of current economic conditions and uncertainty, including tariffs, interest rates, and inflation.
Adjusted EBITDA Adjusted EBITDA, a non-GAAP financial measure, was $1.5 billion for 2024 compared to $1.7 billion for 2023. Adjusted EBITDA decreased 11.5% year-over-year. The decrease primarily reflects the $566.4 million decrease in net sales, and a $50.2 million increase in SG&A expenses, as described above, partially offset by a corresponding decrease in cost of goods sold of $435.3 million.
UBS adjusted EBITDA decreased $80.6 million, or 12.5% year-over-year. The decrease primarily reflects a decline in volume, as described above. The decrease in adjusted EBITDA was partially offset by a decrease in SG&A expenses of $8.3 million as compared to the prior year, which was primarily attributed to lower commissions and incentives of $9.3 million.
SG&A expenses not related to payroll and payroll-related costs for 2024 were $1,256.7 million, an increase of $53.1 million compared to 2023, which primarily reflects higher costs to operate our facilities of $28.0 million, an increase of $20.5 million in other income and deductions, driven by the loss on abandonment of assets, an increase of $12.7 million in IT costs, and an increase of $10.6 million in taxes, partially due to the $4.9 million of excise taxes on excess pension plan assets as discussed above.
SG&A expenses not related to payroll and payroll-related costs for 2025 were $1,347.7 million, an increase of $91.0 million compared to 2024, which primarily reflects increased costs to operate our facilities of $32.8 million, increased transportation costs of $32.1 million, and higher IT costs of $24.8 million.
We were in compliance with all financial covenants and restrictions contained in our debt agreements as of December 31, 2024. We also measure our ability to meet our debt obligations based on our financial leverage ratio, which was 2.9x as of December 31, 2024 and 2.8x as of December 31, 2023.
We communicate on a regular basis with our lenders regarding our financial and working capital performance, and liquidity position. We were in compliance with all financial covenants and restrictions contained in our debt agreements as of December 31, 2025.
Income Taxes The provision for income taxes was $231.6 million for 2024 compared to $225.9 million for 2023, resulting in effective tax rates of 24.4% and 22.8%, respectively. The higher effective tax rate is primarily due to a valuation allowance being recorded against certain deferred tax assets in the current year.
(2) Pension settlement cost represents expense related to the final settlement of the Company's U.S. pension plan. Income Taxes The provision for income taxes was $213.4 million for 2025 compared to $231.6 million for 2024, resulting in effective tax rates of 24.9% and 24.4%, respectively.
SG&A expenses for 2024 totaled $3,306.2 million versus $3,256.0 million for 2023, an increase of 1.5%. As a percentage of net sales, SG&A expenses were 15.2% and 14.5% for 2024 and 2023, respectively.
Selling, General and Administrative ( “ SG&A ” ) Expenses SG&A expenses for 2025 totaled $3.5 billion versus $3.3 billion for 2024, an increase of 7.1%.
Income from operations for 2024 includes digital transformation costs of $24.9 million, a loss on abandonment of assets of $17.8 million as a result of the write-off of certain capitalized cloud computing arrangement implementation costs relating to a third-party developed operations management software product that will no longer be utilized, restructuring costs of $12.1 million, and excise taxes on excess pension plan assets of $4.9 million.
(2) Restructuring costs include severance costs incurred pursuant to an ongoing restructuring plan. (3) Loss on abandonment of assets represents the write-off of certain capitalized cloud computing arrangement implementation costs relating to a third-party developed operations management software product in favor of an application with functionality that better suits the Company’s operations.
The decrease primarily reflects the $63.5 million decline in net sales, as described above, partially offset by a corresponding decrease in cost of goods sold of $58.4 million.
The increase primarily reflects an increase in net sales, partially offset by an increase in cost of goods sold and an increase in SG&A expenses, as described above. The year ended December 31, 2024 included $17.8 million in SG&A expenses from loss on abandonment of assets and $4.9 million in excise taxes on excess pension plan assets.
The Revolving Credit Facility has a borrowing limit of $1,725 million and the purchase limit under the Receivables Facility is $1,550 million. As of December 31, 2024, we had $525.0 million outstanding on the Revolving Credit Facility and $1,450.0 million outstanding under the Receivables Facility.
The maximum borrowing limits of our international lines of credit vary by facility and range between $1.0 million and $12.0 million. As of December 31, 2025, we had $5.6 million outstanding under our international lines of credit.
SG&A expenses for 2024 include $24.9 million of digital transformation costs, a $17.8 million loss on abandonment of assets, $12.1 million of restructuring costs, and $4.9 million of excise taxes on excess pension plan assets. SG&A expenses for 2023 include digital transformation costs of $36.1 million, merger-related and integration costs of $19.3 million, and restructuring costs of $16.7 million.
The following table reconciles SG&A expenses to adjusted SG&A expenses, which is a non-GAAP financial measure, for the periods presented: Year Ended December 31, 2025 % of net sales 2024 % of net sales Adjusted SG&A Expenses: (In millions) SG&A expenses $ 3,541.4 15.1% $ 3,306.2 15.2% Digital transformation costs (1) (35.2) (24.9) Restructuring costs (2) — (12.1) Loss on abandonment of assets (3) — (17.8) Excise taxes on excess pension plan assets (4) — (4.9) Adjusted SG&A expenses $ 3,506.2 14.9% $ 3,246.5 14.9% (1) Digital transformation costs include costs associated with certain digital transformation initiatives.

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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 changeItem 7A. Quantitative and Qualitative Disclosures about Market Risk. Foreign Currency Risks In 2024, approximately 26% of our sales were from our foreign subsidiaries and are denominated in foreign currencies. Our exposure to currency rate fluctuations primarily relate to Canada (Canadian dollar), certain countries in the European Union (euro), the United Kingdom (British pound), Mexico (peso), and Australia (Australian dollar).
Biggest changeOur exposure to currency rate fluctuations primarily relate to Canada (Canadian dollar), certain countries in the European Union (euro), the United Kingdom (British pound), Mexico (Mexican peso), and Australia (Australian dollar).
The fair value of these debt instruments at December 31, 2024 approximated carrying value. We borrow under our Revolving Credit Facility and Receivables Facility for general corporate purposes, including working capital requirements and capital expenditures. Borrowings under the Receivables Facility funded by certain lenders through such lenders’ issuance of commercial paper bear interest at the applicable commercial paper rate.
The fair value of these debt instruments at December 31, 2025 approximated carrying value. We borrow under our Revolving Credit Facility and Receivables Facility for general corporate purposes, including working capital requirements and capital expenditures. Borrowings under the Receivables Facility funded by certain lenders through such lenders’ issuance of commercial paper bear interest at the applicable commercial paper rate.
The fair value of our debt instruments with fixed interest rates is disclosed in Note 4, “Fair Value of Financial Instruments” of our Notes to Consolidated Financial Statements. 40 Table of Contents Floating Rate Borrowings : Our variable rate borrowings comprise the Revolving Credit Facility, the Receivables Facility, and international lines of credit.
The fair value of our debt instruments with fixed interest rates is disclosed in Note 4, “Fair Value of Financial Instruments” of our Notes to Consolidated Financial Statements. Floating Rate Borrowings : Our variable rate borrowings comprise the Revolving Credit Facility, the Receivables Facility, and international lines of credit.
As our 6.00% Anixter Senior Notes due 2025, 7.250% Senior Notes due 2028, 6.375% Senior Notes due 2029, and 6.625% Senior Notes due 2032 were issued at fixed rates, interest expense would not be impacted by interest rate fluctuations.
As our 7.250% Senior Notes due 2028, 6.375% Senior Notes due 2029, 6.625% Senior Notes due 2032, and 6.375% Senior Notes due 2033 were issued at fixed rates, interest expense would not be impacted by interest rate fluctuations.
However, since these forward contracts are intended to be effective economic hedges, we would record offsetting gains as a result of the remeasurement of the underlying foreign currency denominated monetary amounts being hedged. Interest Rate Risk Fixed Rate Borrowings : As of December 31, 2024, approximately 60% of our debt portfolio comprises fixed rate debt.
However, since these forward contracts are intended to be effective economic hedges, we would record offsetting gains as a result of the remeasurement of the underlying foreign currency denominated monetary amounts being hedged. 41 Table of Contents Interest Rate Risk Fixed Rate Borrowings : As of December 31, 2025, approximately 66% of our debt portfolio comprises fixed rate debt.
We prepared a sensitivity analysis of our foreign currency forward contracts assuming a 10% adverse change in the value of foreign currency contracts outstanding. The hypothetical adverse changes would have resulted in recording a $33.0 million and $16.8 million loss in 2024 and 2023, respectively.
We prepared a sensitivity analysis of our foreign currency forward contracts assuming a 10% adverse change in the value of foreign currency contracts outstanding. The hypothetical adverse changes would have resulted in recording a $28.6 million and $33.0 million loss in 2025 and 2024, respectively.
The foreign currency forward contracts are not designated as hedges for accounting purposes. At December 31, 2024 and 2023, the gross and net notional amounts of foreign currency forward contracts outstanding were approximately $345.7 million and $168.4 million, respectively.
The foreign currency forward contracts are not designated as hedges for accounting purposes. At December 31, 2025 and 2024, the gross and net notional amounts of foreign currency forward contracts outstanding were approximately $286.3 million and $345.7 million, respectively.
A 100 basis point rise or decline in interest rates would result in an increase or decrease to interest expense of $20.3 million under our current capital structure. 41 Table of Contents
A 100 basis point rise or decline in interest rates would result in an increase or decrease to interest expense of $19.5 million under our current capital structure. 42 Table of Contents
We also have exposure to currency rate fluctuations related to more volatile markets including Argentina (peso), Brazil (real), Chile (peso), Colombia (peso), Egypt (pound), Mexico (peso), and Turkey (lira). We may establish additional foreign subsidiaries in the future.
We also have exposure to currency rate fluctuations related to more volatile markets including Argentina (Argentine peso), Brazil (Brazilian real), Chile (Chilean peso), Colombia (Colombian peso), Japan (Japanese yen), and New Zealand (New Zealand dollar). We may establish additional foreign subsidiaries in the future.
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Item 7A. Quantitative and Qualitative Disclosures about Market Risk. Foreign Currency Risks In 2025, approximately 26% of our sales were from our foreign subsidiaries and are denominated in foreign currencies.

Other WCC 10-K year-over-year comparisons