Parker-Hannifin Corp
For the period ended Sep 30, 2025. Filed Nov 7, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 7, 2025
PH$917.79+2.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-06.
0000076334-25-000021
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OFCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-07.
0000076334-25-000071
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OFThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 140 previous paragraphs and 124 current paragraphs.
72 unchanged; 41 reworded; 9 added; 26 removed; 1 previous and 2 current paragraphs rearranged.
Tables are not compared: 10 previous and 10 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (9)
Current report
AND COMPARABLE PERIOD ENDED SEPTEMBER 30, 2024
Current report
CONSOLIDATED STATEMENTS OF INCOME
Current report
Selling, general and administrative expenses("SG&A") increased in the current-year quarter primarily due to higher acquisition-related expenses and stock compensation expense, partially offset by lower research and development costs.
Current report
Diversified Industrial Segment backlog, as of September 30, 2025, decreased from the comparable prior-year quarter primarily due to the prior year divestiture of composites and fuel containment business within the North America businesses. Excluding the impact of the prior year divestiture activity, backlog remained relatively flat compared to the prior-year quarter.
Current report
Corporate general and administrative expenses primarily included salaries, benefits and incentive compensation expense, professional service fees, information technology, charitable contributions and other discretionary spending.
Current report
Net cash provided by operating activities increased $38 million for the first three months of fiscal 2026 compared to the first three months of fiscal 2025, primarily driven by higher net income adjusted for non-cash items, such as depreciation, amortization, stock-based compensation expense and deferred income taxes. This was partially offset by changes in working capital relating to accounts receivable and inventories. We continue to focus on managing inventory and other working capital requirements.
Current report
Net cash used in investing activities increased for the first three months of fiscal 2026 compared to the first three months of fiscal 2025, primarily driven by a $1.0 billion increase in cash paid for acquisitions, net of cash acquired related to the acquisition of Curtis.
Current report
•Principal payments totaling $40 million related to borrowings under a term loan facility in the first three months of fiscal 2025.
Removed paragraphs (26)
Previous report
AND COMPARABLE PERIODS ENDED MARCH 31, 2024
Previous report
Our order rates provide a near-term perspective of the Company’s outlook particularly when viewed in the context of prior and future order rates. The Company publishes its order rates on a quarterly basis. The lead time between the time an order is received and revenue is realized generally ranges from one day to 12 weeks for mobile and industrial orders and from one day to 18 months for aerospace orders.
Previous report
On February 9, 2025, a fire damaged a portion of our Saegertown, Pennsylvania facility, causing a pause in production. Some production and operations were re-established within days of the event and global resources have been deployed to restore capacity to minimize customer disruption. Full capacity is expected to be restored during the fourth quarter of fiscal 2025. There was no material impact as a result of this disruption during the third quarter of fiscal 2025 and none are expected during future periods.
Previous report
We maintain third-party insurance coverage for property damage, clean-up, replacement and business interruption, subject to an $8 million deductible and liability retention for the event, which was recorded in other income, net during the third quarter. While we expect to be reimbursed for a significant portion of our business interruption impacts by our third-party insurance coverage, we will not record any associated gain until realized.
Previous report
CONSOLIDATED STATEMENT OF INCOME
Previous report
Net sales decreased in the first nine months of fiscal 2025 due to lower sales in the Diversified Industrial Segment, partially offset by higher sales in the Aerospace Systems Segment. The effect of currency exchange rate changes decreased net sales during the first nine months of fiscal 2025 by approximately $105 million, of which $110 million was attributable to the Diversified Industrial Segment, partially offset by an increase of $5 million in the Aerospace Systems Segment. The impact of divestiture activity decreased net sales by approximately $180 million during the first nine months of fiscal 2025.
Previous report
Selling, general and administrative expenses("SG&A") decreased in the current-year quarter and first nine months of fiscal 2025 primarily due to lower research and development expenses and benefits from prior-year restructuring and acquisition-integration activities, as well as cost containment. In the first nine months of fiscal 2025 lower intangible asset amortization also contributed to the decrease in SG&A.
Previous report
Foreign currency transaction loss (gain) primarily relates to the impact of exchange rates on intercompany transactions, forward contracts, cash, as well as accounts and notes payables and receivables. (Gain) loss on disposal of assets and divestitures during the first nine months of fiscal 2025 primarily relates to the divestiture of the composites and fuel containment ("CFC") business. Refer to Note 4 to the Consolidated Financial Statements for further discussion.
Previous report
The effective tax rate for the first nine months of fiscal 2025 was lower than the U.S. Federal statutory rate of 21 percent for the same reasons as those listed above for the current-year quarter, plus a tax benefit from a lower taxable gain on divestitures than gain under accounting principles generally accepted in the United States of America ("GAAP").
Previous report
1 This table reconciles the percentage changes in net sales of the Diversified Industrial Segment reported in accordance with GAAP to percentage changes in net sales adjusted to remove the effects of divestitures for 12 months after their completion as well as changes in currency exchange rates (a non-GAAP measure). The effects of divestitures and changes in currency exchange rates are removed to allow investors and the Company to meaningfully evaluate the percentage changes in net sales on a comparable basis from period to period.
Previous report
Diversified Industrial Segment backlog decreased from the June 30, 2024 amount of $4.2 billion. The decrease in backlog was related to the CFC divestiture in the North America businesses, partially offset by an increase in backlog in the International businesses. Within the International businesses, the increase in backlog from the June 30, 2024 amount was primarily attributable to Europe and the Asia Pacific region, partially offset by a decrease in backlog in Latin America.
Previous report
Corporate general and administrative expenses decreased in the current-year quarter primarily due to lower benefits and incentive compensation expense, net expense associated with the Company's deferred compensation plan and related investments, charitable contributions and professional service fees.
Previous report
Corporate general and administrative expenses decreased in the first nine months of fiscal 2025 primarily due to lower incentive compensation expense, lower net expense associated with the Company's deferred compensation plan and related investments, information technology expenses and discretionary spend, partially offset by an increase in professional service fees.
Previous report
Other expense (income), net
Previous report
Foreign currency transaction loss (gain) primarily relates to the impact of exchange rates on intercompany transactions, forward contracts, cash, as well as accounts and notes payables and receivables. (Gain) loss on disposal of assets and divestitures during the first nine months of fiscal 2025 primarily relates to the divestiture of the CFC business. Refer to Note 4 to the Consolidated Financial Statements for further discussion.
Previous report
Cash flows from operating activities for the first nine months of fiscal 2025 were $2,309 million compared to $2,147 million for the first nine months of fiscal 2024. This increase of $162 million was primarily related to an increase in earnings combined with strong management of working capital items. We continue to focus on managing inventory and other working capital requirements.
Previous report
•Capital expenditures of $304 million in fiscal 2025 compared to $283 million in fiscal 2024.
Previous report
•Net proceeds totaling $621 million from the sale of the CFC and non-core filtration businesses in fiscal 2025.
Previous report
•Proceeds totaling $74 million from the sale of the MicroStrain sensing systems and Filter Resources businesses in fiscal 2024.
Previous report
•Principal payments totaling $490 million related to borrowings under the term loan facility ("Term Loan Facility") in fiscal 2025 compared to principal payments totaling $250 million related to the Term Loan Facility in fiscal 2024.
Previous report
•Aggregate principal payment of $500 million related to the maturity of medium-term notes during fiscal 2025.
Previous report
•Issuance of €700 million aggregate principal amount of 2.90 percent Senior Notes due 2030 (the "Notes") for which the proceeds were used to repay the €700 million aggregate principal amount of 1.125 percent Senior Notes due 2025 in fiscal 2025.
Previous report
In February 2025, the Company issued €700 million aggregate principal amount of 2.90 percent Senior Notes due March 1, 2030. Interest on the Notes will be paid annually on March 1 of each year, commencing March 1, 2026. We used the net proceeds from the issuance of the Notes, together with cash on hand, to repay the €700 million aggregate principal amount of 1.125 percent Senior Notes upon maturity in March 2025. Refer to Notes 15 and 17 to the Consolidated Financial Statements for further discussion.
Previous report
Our debt portfolio included a Term Loan Facility. During the nine months ended March 31, 2025, we repaid the remaining principal balance of $490 million of the Term Loan Facility. Refer to Note 15 to the Consolidated Financial Statements for further discussion.
Reworded paragraphs (41)
Previous wording
FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 2025
Current wording
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2025
Previous wording
The discussion below is structured to separately discuss the Consolidated Statement of Income, Business Segments, and Liquidity and Capital Resources. As used in this Quarterly Report on Form 10-Q, unless the context otherwise requires, the terms "Company", "Parker", "we" or "us" refer to Parker-Hannifin Corporation and its subsidiaries. Dollars are presented in millions (except per share amounts or as otherwise noted) and computed based on the amounts in thousands; therefore, totals may not sum due to rounding.
Current wording
Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide a reader of our financial statements with a narrative, from management's perspective, on our financial condition and results of operations. The following discussion and analysis should be read in conjunction with, the consolidated financial statements and the accompanying notes in Item 1 in this Quarterly Report on Form 10-Q, as well as our Annual Report on Form 10-K for the year ended June 30, 2025. As used in this Quarterly Report on Form 10-Q, unless the context otherwise requires, the terms "Company", "Parker", "we" or "us" refer to Parker-Hannifin Corporation and its subsidiaries. Dollars are presented in millions, except per share amounts or as otherwise noted. The Company has changed its presentation on the consolidated financial statements from thousands to millions and, as a result, any necessary rounding adjustments have been made to prior period disclosed amounts within MD&A.
Previous wording
Net sales decreased in the current-year quarter due to lower sales in the Diversified Industrial Segment, partially offset by higher sales in the Aerospace Systems Segment. The effect of currency exchange rate changes decreased net sales during the current-year quarter by approximately $57 million, which was primarily attributable to the Diversified Industrial Segment. The impact of divestiture activity decreased net sales by approximately $105 million during the current-year quarter.
Current wording
Net sales increased in the current-year quarter due to higher sales in the Aerospace Systems Segment, partially offset by lower sales in the Diversified Industrial Segment. The effect of currency exchange rate changes increased net sales during the current-year quarter by approximately $33 million. The impact of prior-year divestiture activity decreased net sales by approximately $108 million during the current-year quarter. The impact of the acquisition of Curtis increased net sales by approximately $11 million during the current-year quarter.
Previous wording
Gross profit margin (calculated as net sales minus cost of sales, divided by net sales) increased in the current-year quarter and first nine months of fiscal 2025 due to higher margins in both segments primarily resulting from price increases, favorable product mix and cost containment, as well as benefits from prior-year business realignment activities, partially offset by decreased volume within the Diversified Industrial Segment.
Current wording
Gross profit margin (calculated as net sales minus cost of sales, divided by net sales) increased in the current-year quarter due to higher margins in the Diversified Industrial Segment primarily due to favorable product mix, cost containment initiatives and benefits from prior-year business realignment activities.
Previous wording
Cost of sales also included business realignment and acquisition integration charges of $5 million and $4 million for the current and prior-year quarter, respectively, and $21 million for both the first nine months of fiscal 2025 and 2024.
Current wording
Cost of sales also included business realignment charges of $9 million and $5 million for the current and prior-year quarter, respectively.
Previous wording
SG&A also included business realignment and acquisition integration charges of $11 million and $16 million for the current and prior-year quarter, respectively, and $37 million and $42 million for the first nine months of fiscal 2025 and 2024, respectively.
Current wording
SG&A also included business realignment and acquisition integration charges of $12 million and $10 million for the current and prior-year quarter, respectively.
Previous wording
Interest expense decreased during the current-year quarter and the first nine months of fiscal 2025 primarily due to lower average debt outstanding.
Current wording
Interest expense decreased during the current-year quarter primarily due to lower average interest rates and lower average debt outstanding.
Previous wording
Effective tax rate for the current-year quarter of fiscal 2025 was lower than the U.S. Federal statutory rate of 21 percent due to tax benefits from the release of a foreign valuation allowance, share-based compensation, and foreign-derived intangible income, which were partially offset by U.S. state and local taxes and taxes related to international activities. Refer to Note 16 to the Consolidated Financial Statements for further discussion.
Current wording
Effective tax rate for the current-year quarter of fiscal 2026 was greater than the U.S. Federal statutory rate of 21 percent due to U.S. state and local taxes and taxes related to international activities, which were partially offset by tax benefits from share-based compensation and foreign-derived intangible income.
Previous wording
The effective tax rate for the comparable prior-year periods was equal to the U.S. Federal statutory rate of 21 percent due to tax benefits from share-based compensation and foreign-derived intangible income, which were offset by U.S. state and local taxes and taxes related to international activities.
Current wording
The effective tax rate for the comparable prior-year period was lower than the U.S. Federal statutory rate of 21 percent due to tax benefits from share-based compensation and foreign-derived intangible income, which were partially offset by U.S. state and local taxes and taxes related to international activities.
Previous wording
The fiscal 2025 effective tax rate is expected to be approximately 16 percent.
Current wording
The fiscal 2026 effective tax rate is expected to be approximately 22.5 percent.
Previous wording
The Business Segment information presents sales and operating income on a basis that is consistent with the manner in which the Company's various businesses are managed for internal review and decision-making.
Current wording
The Company operates in two reportable business segments: Diversified Industrial and Aerospace Systems. The business segment information presents sales and operating income on a basis that is consistent with the manner in which the Company's various businesses are managed for internal review and decision-making.
Previous wording
The Diversified Industrial Segment operations experienced the following percentage changes in net sales in the current-year periods versus the comparable prior-year periods:
Current wording
The Diversified Industrial Segment operations experienced the following percentage changes in net sales in the current-year period versus the comparable prior-year period:
Previous wording
Diversified Industrial Segment sales decreased $277 million and $701 million from the prior-year quarter and first nine months of fiscal 2024, respectively. The effect of changes in currency exchange rates decreased sales by approximately $54 million and $110 million in the current-year quarter and first nine months of fiscal 2025, respectively. The impact of divestiture activity decreased sales by approximately $105 million and $180 million in the current-year quarter and first nine months of fiscal 2025, respectively. Excluding the effects of the changes in currency exchange rates and divestiture activity, sales decreased $118 million and $411 million from the prior-year quarter and first nine months of fiscal 2024, respectively.
Current wording
Diversified Industrial Segment sales decreased $13 million from the prior-year quarter. The effect of the Curtis acquisition increased sales by approximately $11 million in the current-year quarter. The effect of changes in currency exchange rates increased sales by approximately $25 million in the current-year quarter. The impact of divestiture activity decreased sales by approximately $108 million in the current-year quarter. Excluding the effects of the acquisition, changes in currency exchange rates and divestiture activity, sales increased $59 million from the prior-year quarter.
Previous wording
North America businesses - Sales decreased $201 million and $512 million from the prior-year quarter and first nine months of fiscal 2024, respectively. The effect of changes in currency exchange rates decreased sales by approximately $17 million and $37 million in the current-year quarter and first nine months of fiscal 2025, respectively. The effects of divestiture activity decreased sales by approximately $105 million and $180 million in the current-year quarter and first nine months of fiscal 2025, respectively. Excluding the effects of changes in currency exchange rates and divestiture activity, sales in the North America businesses decreased $78 million and $296 million in the current-year quarter and first nine months of fiscal 2025, respectively. In the current-year quarter and first nine months of fiscal 2025, the decrease in sales is primarily due to lower demand from end users in the in-plant and industrial equipment, off-highway, transportation and energy markets, partially offset by an increase in end-user demand in the HVAC and refrigeration and aerospace and defense markets.
Current wording
North America businesses - Sales decreased $56 million from the prior-year quarter. The effect of the Curtis acquisition increased sales by approximately $6 million in the current-year quarter. The effects of divestiture activity decreased sales by approximately $108 million in the current-year quarter. Currency exchange rates did not materially impact sales in the current-year quarter. Excluding the effects of the acquisition, divestiture activity and changes in currency exchange rates, sales in the North America businesses increased $45 million in the current-year quarter, which was primarily due to higher demand from end users in the in-plant and industrial equipment, HVAC and refrigeration and aerospace and defense markets, partially offset by lower demand from end users in the transportation market.
Previous wording
International businesses - Sales decreased $76 million and $189 million from the prior-year quarter and first nine months of fiscal 2024, respectively. The effect of changes in currency exchange rates decreased sales by approximately $37 million and $73 million in the current-year quarter and first nine months of fiscal 2025. Excluding the effects of changes in currency exchange rates, sales in the International businesses decreased $40 million and $115 million in the current-year quarter and first nine months of fiscal 2025, respectively. In both the current-year quarter and first nine months of fiscal 2025, this decrease in sales was due to lower sales in Europe, partially offset by an increase in sales in the Asia Pacific region and Latin America.
Current wording
International businesses - Sales increased $43 million from the prior-year quarter. The effect of the Curtis acquisition increased sales by approximately $5 million in the current-year quarter. The effect of changes in currency exchange rates increased sales by approximately $24 million in the current-year quarter. Excluding the effects of the acquisition and changes in currency exchange rates, sales in the International businesses increased $14 million in the current-year quarter primarily due to higher sales in the Asia Pacific region, partially offset by a decrease in sales in Europe.
Previous wording
Within Latin America, sales in the current-year quarter increased primarily due to higher end-user demand in the in-plant and industrial equipment, off-highway and transportation markets, partially offset by lower demand from end users in the energy market. In the first nine months of fiscal 2025, sales increased primarily due to higher end-user demand in the in-plant and industrial equipment, transportation, off-highway and energy markets.
Current wording
Within Europe, sales in the current-year quarter decreased primarily due to lower sales in the energy market related to the timing of customer capital projects, partially offset by higher user demand in the in-plant and industrial equipment and transportation markets.
Previous wording
Within the Asia Pacific region, sales in the current-year quarter and first nine months of fiscal 2025 increased primarily due to higher end-user demand in the electronics and semiconductor and in-plant and industrial equipment markets, partially offset by lower demand from end users in the transportation, energy and off-highway markets.
Current wording
Within the Asia Pacific region, sales in the current-year quarter increased primarily due to higher demand within the electronics and semiconductor market, partially offset by lower demand from end users in the transportation market.
Previous wording
Within Europe, sales in the current-year quarter and first nine months of fiscal 2025 decreased primarily due to lower demand from end users across the in-plant and industrial equipment, off-highway and transportation markets.
Current wording
Within Latin America, sales in the current-year quarter remained flat primarily due to higher demand within the energy market, offset by lower demand from end users across the transportation, in-plant and industrial equipment and off-highway markets.
Previous wording
Diversified Industrial Segment operating margin increased during the current-year quarter and first nine months of fiscal 2025 in both the North America and International businesses due to favorable product mix, price increases and benefits related to prior- year restructuring activities as well as cost containment, partially offset by decreased sales volume. Also, during the current-year quarter and first nine months of fiscal 2025, operating margin in the North America businesses benefited from divestiture activity.
Current wording
Diversified Industrial Segment operating margin increased during the current-year quarter, in both the North America and International businesses, primarily due to favorable product mix and benefits from prior-year business realignment activities. Within the North America businesses operating margins also benefitted from operational efficiencies, partially offset by an increase in material costs. Operating margins in the International businesses also increased due to price increases and cost containment initiatives.
Previous wording
The business realignment charges primarily consist of severance costs related to actions taken under the Company's simplification initiative aimed at reducing organizational and process complexity, as well as plant closures. Acquisition integration charges relate to the acquisition of Meggitt plc ("Meggitt"). Business realignment and acquisition integration charges within the International businesses were primarily incurred in Europe.
Current wording
In both periods, business realignment and acquisition integration charges primarily related to business realignment activities. The business realignment charges primarily consist of severance costs related to actions taken under the Company's simplification initiative aimed at reducing organizational and process complexity, as well as plant closures. Business realignment charges within the International businesses were primarily incurred in Europe.
Previous wording
We anticipate that cost savings realized from the workforce reduction measures taken in the first nine months of fiscal 2025 will not materially impact operating income in fiscal 2025 and will increase operating income by approximately two percent in fiscal 2026 for both the North America and International businesses. We expect to continue to take actions necessary to appropriately structure the operations of the Diversified Industrial Segment. We currently anticipate incurring approximately $20 million of additional business realignment charges in the remainder of fiscal 2025. However, continually changing business conditions could impact the ultimate costs we incur.
Current wording
We anticipate that cost savings realized from the workforce reduction measures taken in the first three months of fiscal 2026 will not materially impact operating income in fiscal 2026 and 2027. We expect to continue to take actions necessary to appropriately structure the operations of the Diversified Industrial Segment. We currently anticipate incurring approximately $55 million of additional business realignment charges in the remainder of fiscal 2026. However, continually changing business conditions could impact the ultimate costs we incur.
Previous wording
Diversified Industrial Segment backlog, as of March 31, 2025, decreased from the prior-year quarter. Approximately 95 percent of the decrease in backlog was related to the CFC divestiture in the North America businesses. Approximately five percent of the decrease was due to shipments exceeding orders in the International businesses. Within the International businesses, Latin America, Europe and the Asia Pacific region accounted for approximately 60 percent, 30 percent and 10 percent of the decrease, respectively.
Current wording
Diversified Industrial Segment backlog decreased from the June 30, 2025 amount of $3.7 billion primarily due to shipments exceeding orders in the North America businesses.
Previous wording
Aerospace Systems Segment sales increased in both the current-year quarter and first nine months of fiscal 2025 primarily due to higher volume in the commercial and defense aftermarket. Higher volume in the commercial and defense original equipment manufacturer ("OEM") market segments also contributed to the sales increase.
Current wording
Aerospace Systems Segment sales increased in the current-year quarter primarily due to higher volume in the commercial OEM and aftermarket, as well as the defense OEM market segment.
Previous wording
Aerospace Systems Segment operating margin increased during both the current-year quarter and first nine months of fiscal 2025 due to higher sales volume and favorable aftermarket mix, as well as benefits from cost containment initiatives and prior-year acquisition integration activities.
Current wording
Aerospace Systems Segment operating margin increased during the current-year quarter due to higher sales volume, aftermarket profitability, as well as benefits from cost containment initiatives.
Previous wording
Within the Aerospace Systems Segment, we incurred acquisition integration and business realignment charges of $3 million and $12 million in the current and prior-year quarter, respectively, and $16 million and $27 million in the first nine months of fiscal 2025 and 2024, respectively. We do not expect to incur material business realignment and acquisition integration charges in the remainder of fiscal 2025. However, continually changing business conditions could impact the ultimate costs we incur.
Current wording
Within the Aerospace Systems Segment, we incurred business realignment and acquisition integration charges of $5 million in both the current and prior-year quarter. In both periods, these charges primarily related to acquisition integration activities. We do not expect to incur material business realignment or acquisition integration charges for the remainder of fiscal 2026. However, continually changing business conditions could impact the ultimate costs we incur.
Previous wording
Aerospace Systems Segment backlog, as of March 31, 2025, increased from the prior-year quarter primarily due to orders exceeding shipments in the defense and commercial OEM market segments. The increase in backlog from the June 30, 2024 amount of $6.7 billion is primarily due to orders exceeding shipments in the commercial and defense OEM market segments. Commercial and defense aftermarket backlog at March 31, 2025 remained relatively flat when compared to the June 30, 2024 amount.
Current wording
Aerospace Systems Segment backlog as of September 30, 2025, increased from both the comparable prior-year quarter and the June 30, 2025 balance of $7.4 billion, primarily due to orders exceeding shipments in all market segments, especially in the commercial OEM and aftermarket market segments.
Previous wording
•Days sales outstanding relating to trade accounts receivable was 53 days at March 31, 2025, 51 days at June 30, 2024 and 53 days at March 31, 2024.
Current wording
•Days sales outstanding relating to trade accounts receivable was 52 days at September 30, 2025, 51 days at June 30, 2025 and 52 days at September 30, 2024.
Previous wording
•Days supply of inventory on hand was 85 days at March 31, 2025, 80 days at June 30, 2024 and 87 days at March 31, 2024.
Current wording
•Days supply of inventory on hand was 93 days at September 30, 2025, 82 days at June 30, 2025 and 91 days at September 30, 2024.
Previous wording
Cash flows from financing activities for the first nine months of fiscal 2025 and 2024 were impacted by the following factors:
Current wording
Net cash provided by (used in) financing activities for the first three months of fiscal 2026 and 2025 were impacted by the following factors:
Previous wording
•Net commercial paper repayments of $213 million in fiscal 2025 compared to net commercial paper repayments of $941 million in fiscal 2024.
Current wording
•Net commercial paper borrowings of $1.1 billion in the first three months of fiscal 2026 compared to net commercial paper repayments of $377 million in the first three months of fiscal 2025.
Previous wording
•Repurchases under the Company's share repurchase program amounted to 1.2 million common shares for $750 million during fiscal 2025, compared to 0.3 million common shares for $149 million during fiscal 2024.
Current wording
•Repurchases under the Company's share repurchase program amounted to 0.6 million common shares for $475 million during the first three months of fiscal 2026, compared to 0.1 million common shares for $50 million during the first three months of fiscal 2025.
Previous wording
We are actively monitoring our liquidity position and remain focused on managing our inventory and other working capital requirements. We are continuing to target two percent of sales for capital expenditures and are prioritizing those related to safety, strategic investments and sustainability initiatives. We believe that cash generated from operations and our commercial paper program will satisfy our operating needs for the foreseeable future.
Current wording
We are actively monitoring our liquidity position and remain focused on managing our inventory and other working capital requirements. We are targeting 2.5 percent of sales for capital expenditures for 2026 and have a long-term target of two percent. We will continue to prioritize capital expenditures related to safety, productivity and strategic investments. We believe that cash generated from operations and our commercial paper program will satisfy our operating needs for the foreseeable future.
Previous wording
We declared a quarterly cash dividend of $1.63 per share on January 23, 2025, which was paid on March 7, 2025. Dividends have been paid for 299 consecutive quarters. Additionally, we declared a quarterly cash dividend of $1.80 per share on April 24, 2025, payable on June 6, 2025, increasing our annual dividend per share paid to shareholders for 69 consecutive fiscal years.
Current wording
We declared a quarterly cash dividend of $1.80 per share on August 21, 2025, which was paid on September 12, 2025. Dividends have been paid for 301 consecutive quarters, including a yearly increase in dividends for 69 consecutive fiscal years. Additionally, we declared a quarterly cash dividend of $1.80 per share on October 22, 2025, payable on December 5, 2025.
Previous wording
The Company has a program to repurchase its common shares. On October 22, 2014, the Board of Directors of the Company approved an increase in the overall number of shares authorized to repurchase under the program so that, beginning on such date, the aggregate number of shares authorized for repurchase was 35 million. There is no limitation on the number of shares that can be repurchased in a year. Repurchases may be funded primarily from operating cash flows and commercial paper borrowings and the shares are initially held as treasury shares. Refer to Note 6 to the Consolidated Financial Statements for further discussion of share repurchases.
Current wording
On August 21, 2025, the Board of Directors approved an update to the number of shares available under the Company's previous share repurchase authorization so that the aggregate number of shares available for repurchase as of such date was 20.0 million. There is no limitation on the number of shares that can be repurchased in a year and there is no expiration date for the program. As of September 30, 2025, 19.4 million shares remained available under the repurchase authorization. Refer to Note 10 to the consolidated financial statements for further discussion of share repurchases.
Previous wording
Cash, comprised of cash and cash equivalents and marketable securities and other investments, includes $329 million and $311 million held by the Company's foreign subsidiaries at March 31, 2025 and June 30, 2024, respectively. The Company does not permanently reinvest certain foreign earnings. The distribution of these earnings could result in non-federal U.S. or foreign taxes. All other undistributed foreign earnings remain permanently reinvested.
Current wording
Cash, comprised of cash and cash equivalents, marketable securities and other investments, includes $384 million and $344 million held by the Company's foreign subsidiaries at September 30, 2025 and June 30, 2025, respectively. The Company does not permanently reinvest certain foreign earnings. The distribution of these earnings could result in non-federal U.S. or foreign taxes. All other undistributed foreign earnings remain permanently reinvested.
Previous wording
The Company has a line of credit totaling $3.0 billion through a multi-currency revolving credit agreement with a group of banks, of which $1.1 billion was available as of March 31, 2025. Advances from the credit agreement can be used for general corporate purposes, including acquisitions, and for the refinancing of existing indebtedness. The credit agreement supports our commercial paper program, and issuances of commercial paper reduce the amount of credit available under the credit agreement. The credit agreement expires in June 2028; however, the Company has the right to request a one-year extension of the expiration date on an annual basis, which may result in changes to the current terms and conditions of the credit agreement. The credit agreement requires the payment of an annual facility fee, the amount of which is dependent upon the Company’s credit ratings. Although a lowering of the Company’s credit ratings would increase the cost of future debt, it would not limit the Company’s ability to use the credit agreement, nor would it accelerate the repayment of any outstanding borrowings.
Current wording
As of September 30, 2025, the Company had a line of credit totaling $3.75 billion through a multi-currency revolving credit agreement with a group of banks, of which $0.9 billion was available for borrowing as of September 30, 2025. The multi-currency revolving credit agreement was amended on August 21, 2025, to increase the total line of credit by $750 million to $3.75 billion. Advances from the credit agreement can be used for general corporate purposes, including acquisitions, and for the refinancing of existing indebtedness. The credit agreement supports our commercial paper program, and issuances of commercial paper reduce the amount of credit available under the credit agreement. The credit agreement expires in June 2028; however, the Company has the right to request a one-year extension of the expiration date on an annual basis, which may result in changes to the current terms and conditions of the credit agreement. The credit agreement requires the payment of an annual facility fee, the amount of which is dependent upon the Company’s credit ratings. Although a lowering of the Company’s credit ratings would increase the cost of future debt, it would not limit the Company’s ability to use the credit agreement, nor would it accelerate the repayment of any outstanding borrowings.
Previous wording
We are currently authorized to sell up to $3.0 billion of short-term commercial paper notes. As of March 31, 2025, $1.9 billion of commercial paper notes were outstanding, and the largest amount of commercial paper notes outstanding during the current-year quarter was $2.2 billion.
Current wording
On August 21, 2025, the authorization limit to sell short-term commercial paper notes was increased from $3.0 billion to $3.75 billion. As of September 30, 2025, $2.8 billion of commercial paper notes were outstanding, and the largest amount of commercial paper notes outstanding during the current-year quarter was $3.1 billion.
Previous wording
The Company’s credit agreement and indentures governing certain debt securities contain various covenants, the violation of which would limit or preclude the use of the credit agreements for future borrowings, or might accelerate the maturity of the related outstanding borrowings covered by the indentures. Based on the Company’s rating level at March 31, 2025, the most restrictive financial covenant provides that the ratio of debt to debt-shareholders' equity cannot exceed 0.65 to 1.0. At March 31, 2025, the Company's debt to debt-shareholders' equity ratio was 0.41 to 1.0. We are in compliance and expect to remain in compliance with all covenants set forth in the credit agreement and indentures.
Current wording
The Company’s credit agreement and indentures governing certain debt securities contain various covenants, the violation of which would limit or preclude the use of the credit agreements for future borrowings, or might accelerate the maturity of the related outstanding borrowings covered by the indentures. Based on the Company’s rating level at September 30, 2025, the most restrictive financial covenant provides that the ratio of debt to debt-shareholders' equity cannot exceed 0.65 to 1.0. At September 30, 2025, the Company's debt to debt-shareholders' equity ratio was 0.43 to 1.0. We are in compliance and expect to remain in compliance with all covenants set forth in the credit agreement and indentures.
Previous wording
Acquisitions will be considered from time to time to the extent there is a strong strategic fit, while at the same time maintaining the Company’s strong financial position. In addition, we will continue to assess our existing businesses and initiate efforts to divest businesses that are not considered to be a good long-term strategic fit for the Company. On July 28, 2024, the Company signed an agreement to divest its CFC business within the North America businesses of the Diversified Industrial Segment, which was acquired as part of the Meggitt acquisition. This divestiture closed on November 1, 2024 for net proceeds of $555 million. Refer to Note 4 to the Consolidated Financial Statements for further discussion. Additionally, we divested a non-core filtration business within the North America businesses of the Diversified Industrial Segment for proceeds of $66 million on November 1, 2024.
Current wording
Acquisitions will be considered from time to time to the extent there is a strong strategic fit, while at the same time maintaining the Company’s strong financial position. In addition, we will continue to assess our existing businesses and initiate efforts to divest businesses that are not considered to be a good long-term strategic fit for the Company. On September 18, 2025, we completed the acquisition of Curtis, for approximately $1.0 billion, net of cash acquired. Refer to Note 4 to the consolidated financial statements for further discussion.
Previous wording
Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. Often but not always, these statements may be identified from the use of forward-looking terminology such as “anticipates,” “believes,” “may,” “should,” “could,” “expects,” “targets,” “is likely,” “will,” or the negative of these terms and similar expressions, and include all statements regarding future performance, earnings projections, events or developments. Neither Parker nor any of its respective associates or directors, officers or advisers, provides any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements will actually occur. Parker cautions readers not to place undue reliance on these statements. It is possible that the future performance and earnings projections of the company, including its individual segments, may differ materially from past performance or current expectations. A change in the economic conditions in individual markets may have a particularly volatile effect on segment performance.
Current wording
Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. Often but not always, these statements may be identified from the use of forward-looking terminology such as “anticipates,” “believes,” “may,” “should,” “could,” “expects,” “targets,” “is likely,” “will,” or the negative of these terms and similar expressions, and include all statements regarding future performance, orders, earnings projections, events or developments. Neither Parker nor any of its respective associates or directors, officers or advisers, provides any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements will actually occur. Parker cautions readers not to place undue reliance on these statements. It is possible that the future performance may differ materially from past performance or current expectations. A change in the economic conditions in individual markets may have a particularly volatile effect on segment performance.
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Current report — wording carried from elsewhere
Business Realignment and Acquisition Integration Charges
Current report — wording carried from elsewhere
Business Realignment and Acquisition Integration Charges
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Cash flows from investing activitiesfor the first nine months of fiscal 2025 and 2024 were impacted by the following factors: