VISHAY INTERTECHNOLOGY INC

Note 1 – Basis of Presentation

The accompanying unaudited consolidated condensed financial statements of Vishay Intertechnology, Inc. (“Vishay” or the “Company”) have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all information and footnotes necessary for presentation of financial position, results of operations, and cash flows required by accounting principles generally accepted in the United States (“GAAP”) for complete financial statements. The information furnished reflects all normal recurring adjustments which are, in the opinion of management, necessary for a fair summary of the financial position, results of operations, and cash flows for the interim periods presented. The financial statements should be read in conjunction with the consolidated financial statements filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. The results of operations for the fiscal quarter and six fiscal months ended July 4, 2026 are not necessarily indicative of the results to be expected for the full year.

The Company reports interim financial information for 13-week periods beginning on a Sunday and ending on a Saturday, except for the first fiscal quarter, which always begins on January 1, and the fourth fiscal quarter, which always ends on December 31. The four fiscal quarters in 2026 end on April 4, 2026, July 4, 2026, October 3, 2026, and December 31, 2026, respectively. The four fiscal quarters in 2025 ended on March 29, 2025, June 28, 2025, September 27, 2025, and December 31, 2025, respectively.

Accounts Receivable

The Company sells certain of its non-U.S. accounts receivable on a non-recourse basis to third-party financial institutions. These transactions are recognized as sales of receivables because effective control over, and risk related to, the receivables is transferred to the buyers. The Company had $140,873 and $62,175 outstanding on its revolving accounts receivable securitization program as of July 4, 2026 and December 31, 2025, respectively. The cash proceeds are presented as cash provided by operating activities in the consolidated condensed statement of cash flows. After the sale of the accounts receivable, the Company collects payment from the customers and remits it to the third-party financial institutions.

Recently Adopted Accounting Guidance

In July 2025, the FASB issued ASU No. 2025-05, Measurement of Credit Losses for Accounts Receivable and Contract Assets. The ASU allows entities to elect a practical expedient that assumes the current conditions as of the balance sheet date do not change the remaining life of the asset when developing reasonable and supportable forecasts as part of estimating expected credit losses. The Company adopted the ASU effective January 1, 2026. The Company elected the practical expedient made available by the ASU. The adoption of the ASU did not impact the Company's financial position, results of operations, or cash flows.

In September 2025, the FASB issued ASU No. 2025-06, Targeted Improvements to the Accounting for Internal-Use Software. The ASU requires entities to capitalize software costs when management has authorized and committed to funding the software project and it is probable that the project will be completed and the software will be used to perform the function intended. The Company prospectively adopted the ASU effective January 1, 2026. The adoption of the ASU did not impact the Company's financial position, results of operations, or cash flows.

Reclassifications

Certain prior period amounts have been reclassified to conform to the current financial statement presentation.

Note 2 – Restructuring and Related Activities

In September 2024, the Company announced the implementation of restructuring actions designed to optimize the Company’s manufacturing footprint and streamline business decision making.

The following table summarizes activity to date related to this program:

Severance payment terms vary by country, but are generally paid in a lump sum at cessation of employment. Some payments are made over an extended period. Substantially all of the liability is current and is included in other accrued expenses in the accompanying consolidated condensed balance sheets.

Note 3 – Income Taxes

The provision for income taxes consists of provisions for federal, state, and foreign income taxes. The effective tax rates for the periods ended July 4, 2026 and June 28, 2025 reflect the Company’s expected tax rate on reported income before income tax and tax adjustments. The Company operates in a global environment with significant operations in various jurisdictions outside the United States. Accordingly, the consolidated income tax rate is a composite rate reflecting the Company’s earnings and the applicable tax rates in the various jurisdictions where the Company operates.

During the six fiscal months ended July 4, 2026, the liabilities for unrecognized tax benefits increased $261 on a net basis, primarily accruals for the current period, partially offset by settlements and expiration of statutes.

Note 4 – Long-Term Debt

Long-term debt consists of the following:

The following table summarizes some key facts and terms regarding the outstanding convertible senior notes as of July 4, 2026:

Holders of the convertible senior notes due 2030 (the "2030 Notes") may convert all or a portion of their 2030 Notes at their option prior to March 15, 2030, only under the following circumstances:

• The last reported sale price of the common stock for at least the 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price on each applicable trading day;

• During the five business day period after any five consecutive trading day period (the "Measurement Period") in which the trading price of the 2030 Notes for each trading day of the Measurement Period was less than 98% of the product of the last reported sale price of the common stock and the conversion rate in effect on each such trading day;

• If the Company calls any or all of the 2030 Notes for redemption, at any time prior to the close of business on the scheduled trading day prior to the redemption date; or

• Upon the occurrence of specified corporate events.

Pursuant to the indenture governing the 2030 Notes, Vishay will satisfy its conversion obligations by paying $1 cash per $1 principal amount of converted notes and settle any additional amounts due in cash and/or common stock, at the Company's election.

As of July 4, 2026, the first condition above had been met and, therefore, the 2030 Notes became eligible for conversion at the option of the holders beginning on July 6, 2026 and ending at the close of business on October 3, 2026. Vishay has the ability to finance a certain amount of any converted 2030 Notes with borrowings from its long-term revolving credit facility. The principal amount of 2030 Notes and associated deferred financing costs are classified as current liabilities on the July 4, 2026 consolidated condensed balance sheet.

Any determination regarding the convertibility of the 2030 Notes during future periods will be made in accordance with the terms of the indenture governing the 2030 Notes.

In the third fiscal quarter of 2026, the Company used a portion of the net proceeds from the public offering of its common stock, completed on July 1, 2026, to fully repay the outstanding balance on its revolving credit facility.

Deferred financing costs are recognized as non-cash interest expense. Non-cash interest expense was $1,195 and $2,390 for the fiscal quarter and six fiscal months ended July 4, 2026, respectively, and $1,195 and $2,418 for the fiscal quarter and six fiscal months ended June 28, 2025.

Note 5 – Stockholders' Equity

On July 1, 2026, the Company completed an underwritten public offering of 17.25 million shares of its common stock at a price to the public of $50.00 per share for proceeds of $830,250, net of underwriting discounts and issuance costs.

The following table summarizes activity pursuant to the Company's Stockholder Return Policy:

There wereno shares of common stock held as treasury stock as of July 4, 2026 and December 31, 2025.

Note 6 – Revenue Recognition

In the second fiscal quarter of 2026, the Company received tariff refunds from the U.S. government, of which $30,008 will be passed through to customers. The tariff refunds received are recognized as a reduction of costs of products sold and tariff refunds to be passed through to customers are recorded as a reduction of net revenues within the Consolidated Condensed Statements of Operations for the fiscal quarter and six fiscal months ended July 4, 2026. The tariff refunds received and tariff refunds to be passed through to customers have not been allocated to reportable business segments, customer types, regions, or end markets.

Sales returns and allowances accrual activity is shown below:

See disaggregated revenue information in Note 10.

Note 7 – Accumulated Other Comprehensive Income (Loss)

The cumulative balance of each component of other comprehensive income (loss) and the income tax effects allocated to each component are as follows:

Reclassifications of pension and other post-retirement actuarial items out of AOCI are included in the computation of net periodic benefit cost. See Note 8 for further information.

Note 8 – Pensions and Other Postretirement Benefits

The service cost component of net periodic pension cost is classified in costs of products sold or selling, general, and administrative expenses on the consolidated condensed statements of operations based on the respective employee's function. The other components of net periodic pension cost are classified as other expense on the consolidated condensed statements of operations.

Defined Benefit Pension Plans

The following table shows the components of the net periodic pension cost for the second fiscal quarters of 2026 and 2025 for the Company’s defined benefit pension plans:

The following table shows the components of the net periodic pension cost for the six fiscal months ended July 4, 2026 and June 28, 2025 for the Company's defined benefit pension plans:

Other Postretirement Benefits

The following table shows the components of the net periodic benefit cost for the second fiscal quarters of 2026 and 2025 for the Company’s other postretirement benefit plans:

The following table shows the components of the net periodic pension cost for the six fiscal months ended July 4, 2026 and June 28, 2025 for the Company's other postretirement benefit plans:

Note 9 – Stock-Based Compensation

The following table summarizes stock-based compensation expense recognized:

The following table summarizes unrecognized compensation cost and the weighted average remaining amortization periods at July 4, 2026(amortization periods in years):

Restricted Stock Units

RSU activity as of July 4, 2026 and changes during the six fiscal months then ended are presented below(number of RSUs in thousands):

• The number of RSUs vested includes shares that the Company withheld on behalf of employees to satisfy the statutory tax withholding requirements.

The number of performance-based RSUs that are scheduled to vest increases ratably based on the achievement of defined performance and market criteria between the established target and maximum levels. RSUs with performance-based and market-based vesting criteria are expected to vest as follows(number of RSUs in thousands):

Phantom Stock Units

The following table summarizes the Company's phantom stock units activity(number of phantom stock units in thousands):

Note 10 – Segment Information

The following tables set forth reportable business segment information:

The Company has a broad line of products that it sells to OEMs, EMS companies, and independent distributors. The distribution of sales by customer type is shown below:

Net revenues were attributable to customers in the following regions:

The Company generates substantially all of its revenue from product sales to end customers in the industrial, automotive, military and aerospace, healthcare, power supplies, telecommunications, consumer products, and computing end markets. Sales by end market are presented below:

*Power supplies, telecommunications, consumer products, and computing.

Note 11 – Earnings Per Share

The following table sets forth the computation of basic and diluted earnings (loss) per share(shares in thousands):

Diluted earnings (loss) per share for the periods presented do not reflect the following weighted average potential common shares that would have an antidilutive effect or have unsatisfied performance conditions(in thousands):

If the average market price of Vishay common stock is less than the effective conversion price of the convertible senior notes due 2030, no shares are included in the diluted earnings (loss) per share computation for the convertible senior notes due 2030. Pursuant to the indenture governing the convertible senior notes due 2030, Vishay will satisfy its conversion obligations by paying $1 cash per $1 principal amount of converted notes and settle any additional amounts due in cash and/or common stock. Similarly, the convertible senior notes due 2025 were considered, but not included, in the diluted earnings per share computation for any period presented or any period they were outstanding.

In connection with the issuance of the convertible senior notes due 2030, the Company entered into capped call transactions, which were not included in the calculation of diluted earnings per share as their effect would have been anti-dilutive. The capped calls are intended to reduce the potential dilution to the Company's common stock in the event that at the time of conversion of the convertible senior notes due 2030 the Company's common stock price exceeds the conversion price of the convertible senior notes due 2030.

Note 12 – Fair Value Measurements

The following table provides the financial assets and liabilities carried at fair value measured on a recurring basis:

There have been no changes in the classification of any financial instruments within the fair value hierarchy in the periods presented.

The Company maintains non-qualified trusts, referred to as “rabbi” trusts, to fund payments under deferred compensation and non-qualified pension plans. Rabbi trust assets consist primarily of marketable securities, classified as available-for-sale and company-owned life insurance assets. The marketable securities held in the rabbi trusts are valued using quoted market prices on the last business day of the period. The company-owned life insurance assets are valued in consultation with the Company’s insurance brokers using the value of underlying assets of the insurance contracts. The fair value measurement of the marketable securities held in the rabbi trust is considered a Level 1 measurement and the measurement of the company-owned life insurance assets is considered a Level 2 measurement within the fair value hierarchy.

The Company holds investments in debt securities that are intended to fund a portion of its pension and other postretirement benefit obligations outside of the United States. The investments are valued based on quoted market prices on the last business day of the period. The fair value measurement of the investments is considered a Level 1 measurement within the fair value hierarchy.

The Company may be required to make certain contingent consideration payments related to acquisitions. The fair value of these contingent payments is determined by estimating the net present value of the expected cash flows based on the probability of expected payments. The fair value measurement of the contingent consideration payments is considered a Level 3 measurement within the fair value hierarchy.

The fair value of the long-term debt, excluding deferred financing costs, at July 4, 2026 and December 31, 2025 is approximately $1,527,000 and $896,100, respectively, compared to its carrying value, excluding deferred financing costs, of $988,000 and $969,000, respectively. The Company estimates the fair value of its long-term debt using a combination of quoted market prices for similar financing arrangements and expected future payments discounted at risk-adjusted rates, which are considered Level 2 inputs.

At July 4, 2026 and December 31, 2025, the Company’s short-term investments were comprised of time deposits with financial institutions that have maturities that exceed 90 days from the date of acquisition; however they all mature within one year from the respective balance sheet dates. The Company's short-term investments are accounted for as held-to-maturity debt instruments, at amortized cost, which approximates their fair value. The investments are funded with excess cash not expected to be needed for operations prior to maturity; therefore, the Company believes it has the intent and ability to hold the short-term investments until maturity. At each reporting date, the Company performs an evaluation to determine if any unrealized losses are other-than-temporary. No other-than-temporary impairments have been recognized on these securities, and there are no unrecognized holding gains or losses for these securities during the periods presented. There have beenno transfers to or from the held-to-maturity classification. All decreases in the account balance are due to returns of principal at the securities’ maturity dates. Interest on the securities is recognized as interest income when earned.

At July 4, 2026 and December 31, 2025, the Company’s cash and cash equivalents were comprised of demand deposits, time deposits with maturities of three months or less when purchased, and money market funds. The Company estimates the fair value of its cash, cash equivalents, and short-term investments using Level 2 inputs. Based on the current interest rates for similar investments with comparable credit risk and time to maturity, the fair value of the Company's cash, cash equivalents, and held-to-maturity short-term investments approximate the carrying amounts reported in the consolidated condensed balance sheets.

The Company’s financial instruments also include accounts receivable and accounts payable. The carrying amounts for these financial instruments reported in the consolidated condensed balance sheets approximate their fair values.