DANAHER CORP /DE/

Previous wording

You should read this discussion along with the Company’s MD&A and audited financial statements and Notes thereto as of and for the year ended December 31, 2024, included in the Company’s 2024 Annual Report and the Company’s Consolidated Condensed Financial Statements and related Notes as of and for the three and nine-month periods ended September 26, 2025 included in this Quarterly Report on Form 10-Q (“Report”).

Current wording

You should read this discussion along with the Company’s MD&A and audited financial statements and Notes thereto as of and for the year ended December 31, 2025, included in the Company’s 2025 Annual Report and the Company’s Consolidated Condensed Financial Statements and related Notes as of and for the three-month period ended March 27, 2026 included in this Quarterly Report on Form 10-Q (“Report”).

Previous wording

Certain statements included or incorporated by reference in this Report, in other documents we file with or furnish to the Securities and Exchange Commission, in our press releases, webcasts, conference calls, presentations, materials delivered to shareholders and other communications, are “forward-looking statements” within the meaning of the U.S. federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding: projections of tariff or other trade-related impacts, expected impacts of the U.S. government shutdown, revenue, expenses, profit, profit margins, asset values, pricing, tax rates, tax provisions, cash flows, pension and benefit obligations and funding requirements, our liquidity position or other projected financial measures; management’s plans and strategies for future operations, including statements relating to anticipated operating performance, customer demand, cost reductions, restructuring activities, new product and service developments, competitive strengths or market position, acquisitions and the integration thereof, divestitures, spin-offs, split-offs, initial public offerings, other securities offerings or other distributions, strategic opportunities, stock repurchases, dividends, executive compensation and potential executive stock sales or purchases; growth, declines and other trends in markets we sell into; future, new or modified laws, regulations, accounting pronouncements or public policy changes; regulatory approvals and the timing and conditionality thereof; outstanding claims, legal proceedings, tax audits and assessments and other contingent liabilities; future currency exchange rates and fluctuations in those rates; the potential or anticipated direct or indirect impact of public health crises, climate change, military or geopolitical conflicts or other man-made or natural disasters on our business, results of operations and/or financial condition; general economic and capital markets conditions; the anticipated timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that Danaher intends or believes will or may occur in the future. Terminology such as “believe,” “anticipate,” “assume,” “continue,” “should,” “could,” “intend,” “will,” “plan,” “aim,” “expect,” “estimate,” “project,” “target,” “can,” “may,” “possible,” “potential,” “upcoming,” “forecast” and “positioned” and similar references to future periods are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words.

Current wording

Certain statements included or incorporated by reference in this Report, in other documents we file with or furnish to the Securities and Exchange Commission, in our press releases, webcasts, conference calls, presentations, materials delivered to shareholders and other communications, are “forward-looking statements” within the meaning of the U.S. federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding: projections of tariff or other trade-related impacts, revenue, expenses, profit, profit margins, asset values, pricing, tax rates, tax provisions, cash flows, pension and benefit obligations and funding requirements, our liquidity position or other projected financial measures; management’s plans and strategies for future operations, including statements relating to anticipated operating performance, customer demand, cost reductions, restructuring activities, new product and service developments, competitive strengths or market position, acquisitions and the integration thereof (including our pending acquisition of Masimo Corporation, which is further described in Note 2), divestitures, spin-offs, split-offs, initial public offerings, other securities offerings or other distributions, strategic opportunities, stock repurchases, dividends, executive compensation and potential executive stock sales or purchases; growth, declines and other trends in markets we sell into; future, new or modified laws, regulations, accounting pronouncements or public policy changes; regulatory approvals and the timing and conditionality thereof; outstanding claims, legal proceedings, tax audits and assessments and other contingent liabilities; future currency exchange rates and fluctuations in those rates; the potential or anticipated direct or indirect impact of public health crises, climate change, military or geopolitical conflicts or other man-made or natural disasters on our business, results of operations and/or financial condition; general economic and capital markets conditions; the anticipated timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that Danaher intends or believes will or may occur in the future. Terminology such as “believe,” “anticipate,” “assume,” “continue,” “should,” “could,” “intend,” “will,” “plan,” “aim,” “expect,” “estimate,” “project,” “target,” “can,” “may,” “possible,” “potential,” “upcoming,” “forecast” and “positioned” and similar references to future periods are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words.

Previous wording

Forward-looking statements are based on assumptions and assessments made by our management in light of their experience and perceptions of historical trends, current conditions, expected future developments and other factors. Forward-looking statements are not guarantees of future performance and actual results may differ materially from the results, developments and business decisions contemplated by our forward-looking statements. Accordingly, you should not place undue reliance on any such forward-looking statements. Important factors, risks and uncertainties that in the future could cause actual results to differ materially from those envisaged in the forward-looking statements, and that in some cases have affected us in the past, include the following:

Current wording

Forward-looking statements are based on assumptions and assessments made by our management in light of their experience and perceptions of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Forward-looking statements are not guarantees of future performance and actual results may differ materially from the results, developments and business decisions contemplated by our forward-looking statements. Accordingly, you should not place undue reliance on any such forward-looking statements. Important factors, risks and uncertainties that in the future could cause actual results to differ materially from those envisaged in the forward-looking statements, and that in some cases have affected us in the past, include the following:

Previous wording

•Conditions in the global economy, the particular markets we serve and the financial markets (including economic impacts from the U.S. government shutdown that began in October 2025) can adversely affect our business and financial statements.

Current wording

•Conditions in the global economy, the particular markets we serve and the financial markets can adversely affect our business and financial statements.

Previous wording

•Our growth depends on the timely development and commercialization, and customer acceptance, of new and enhanced products and services based on technological innovation. Our growth also suffers when the markets into which we sell our products and services decline, do not grow as anticipated or experience cyclicality.

Current wording

•Our growth depends on the timely development and commercialization, and customer acceptance, of new and enhanced products and services (in this Report, references to products and services also includes software), based on technological innovation. Our growth also suffers when the markets into which we sell our products and services decline, do not grow as anticipated or experience cyclicality.

Previous wording

•Economic, political, geopolitical, legal, compliance, social and business factors (including the impact of military conflicts), both in the U.S. and outside the U.S., can negatively affect our business and financial statements. For example, elections can result in significant political shifts and/or disruptions, and the 2025 change in the U.S. administration as well as recent Supreme Court decisions have resulted in policy, regulatory and economic changes, challenges and uncertainty, including with respect to tariffs and healthcare-related topics. Delays in National Institutes of Health (“NIH”) funding related to the U.S. government shutdown that commenced in October 2025 may also negatively affect our business and financial statements.

Current wording

•Economic, political, geopolitical, legal, compliance, social and business factors, both in the U.S. and outside the U.S., can negatively affect our business and financial statements. For example, the 2025 change in the U.S. administration as well as recent Supreme Court decisions have resulted in policy, regulatory and economic changes, challenges and uncertainty, including with respect to tariffs and healthcare-related topics. In addition, recent escalation of conflict in the Middle East has heightened geopolitical instability and economic uncertainty.

Previous wording

•Uncertainties with respect to the development, deployment and use of artificial intelligence in our business and products may result in harm to our business and reputation.

Current wording

•The development, deployment and use of artificial intelligence in our business and products, and uncertainties with respect thereto, may result in harm to our business and reputation.

Previous wording

•Global heath crises, pandemics, epidemics or other outbreaks can adversely impact certain elements of our business and financial statements.

Current wording

•Global health crises, pandemics, epidemics or other outbreaks can adversely impact certain elements of our business and financial statements.

Previous wording

•The inability to consummate acquisitions at our historical rate and appropriate prices, realize the economic benefits of consummated acquisitions or to make appropriate investments that support our long-term strategy, can negatively impact our business. Our acquisition of businesses, investments, joint ventures and other strategic relationships can also negatively impact our business and financial statements and our indemnification rights may not fully protect us from liabilities related thereto.

Current wording

•The inability to consummate acquisitions at our historical rate and appropriate prices, realize the economic benefits of consummated acquisitions or to make appropriate investments that support our long-term strategy, can negatively impact our business. Our acquisition of businesses (including our pending acquisition of Masimo Corporation), investments, joint ventures and other strategic relationships can also negatively impact our business and financial statements and our indemnification rights may not fully protect us from liabilities related thereto.

Previous wording

•From time to time our outstanding debt has increased significantly as a result of acquisitions and other factors, and we may incur additional debt. Such indebtedness may limit our operations and use of cash flow and negatively impact our credit ratings; and failure to comply with our indebtedness-related covenants could adversely affect our business and financial statements.

Current wording

•From time to time our outstanding debt has increased significantly as a result of acquisitions and other factors, and we expect to incur additional debt. For example, the Company expects to incur debt to finance a portion of the purchase price for our pending acquisition of Masimo Corporation. Our indebtedness may limit our operations and use of cash flow and negatively impact our credit ratings; and failure to comply with our indebtedness-related covenants could adversely affect our business and financial statements.

Previous wording

During the third quarter of 2025, the Company’s overall revenues and core sales increased 4.5% and 3.0%, respectively, compared to the comparable period of 2024. For the nine-month period ended September 26, 2025, overall revenues and core sales increased 2.5% and 1.5%, respectively, compared to the comparable prior year period. In both periods, the increase in core sales is due to higher core sales in the Biotechnology and Diagnostics segments that were partially offset by lower core sales in the Life Sciences segment. In the three and nine-month periods ended September 26, 2025, the impact of foreign currency increased reported sales by 1.5% and 1.0%, respectively. Price increases contributed 0.5% to sales growth on a year-over-year basis during both the three and nine-month periods ended September 26, 2025 and are reflected as a component of core sales above. For the definitions of “core sales” and “acquisitions” refer to “—Results of Operations” below.

Current wording

During the first quarter of 2026, the Company’s overall revenues and core sales increased 3.5% and 0.5%, respectively, compared to the comparable period of 2025. The increase in core sales is due to higher core sales in the Biotechnology and Life Sciences segments that were largely offset by lower core sales in the Diagnostics segment. In the three-month period ended March 27, 2026, the impact of foreign currency increased reported sales by 3.0%. Price changes did not have a significant impact on sales growth on a year-over-year basis during the three-month period ended March 27, 2026 and are reflected as a component of core sales above. For the definitions of “core sales” and “acquisitions” refer to “—Results of Operations” below.

Previous wording

Geographically, the Company’s sales in the three-month period ended September 26, 2025 in developed markets increased year-over-year by 5% and core sales in developed markets were up mid-single digits, primarily due to mid-single digit core sales increases in North America. The increase in core sales in developed markets was primarily driven by increases in the Diagnostics and Biotechnology segments, partially offset by decreased year-over-year core sales in the Life Sciences segment. For the same period, sales in high-growth markets increased year-over-year by 2% and core sales were up low-single digits as a mid-single digit decline in core revenue in China was more than offset by increased core sales in other regions. In the high-growth markets, the Life Sciences and Biotechnology segments’ increase in demand was partially offset by core sales declines in the Diagnostics segment. High-growth markets represented approximately 29% of the Company’s total sales in the third quarter of 2025. For additional information regarding the Company’s sales by geographical region during the three and nine-month periods ended September 26, 2025 and September 27, 2024, refer to Note 4 to the accompanying Consolidated Condensed Financial Statements.

Current wording

Geographically, the Company’s sales in the three-month period ended March 27, 2026 in developed markets increased year-over-year by 3% and core sales in developed markets were down slightly as mid-single digit core sales decreases in North America were largely offset by a mid-single digit increase in Western Europe. The decrease in core sales in developed markets was primarily driven by decreases in the Diagnostics and Life Sciences segments, partially offset by increased year-over-year core sales in the Biotechnology segment. For the same period, sales in high-growth markets increased year-over-year by 6% and core sales were up low-single digits driven primarily by a mid-single digit increase in core revenue in China. In the high-growth markets, the Biotechnology and Life Sciences segments’ increase in demand was partially offset by core sales declines in the Diagnostics segment. High-growth markets represented approximately 27% of the Company’s total sales in the first quarter of 2026. For additional information regarding the Company’s sales by geographical region during the three-month periods ended March 27, 2026 and March 28, 2025, refer to Note 4 to the accompanying Consolidated Condensed Financial Statements.

Previous wording

The Company’s net earnings for the three and nine-month periods ended September 26, 2025 totaled $908 million and approximately $2.4 billion, or $1.27 and $3.37 per diluted common share, respectively, compared to $818 million and approximately $2.8 billion, or $1.12 and $3.80 per diluted common share, respectively, for the three and nine-month periods ended September 27, 2024. Impairment charges of $548 million ($409 million after-tax or $0.57 per diluted common share) recorded in the nine-month period ended September 26, 2025, net of impairment charges of $222 million ($169 million after-tax or $0.23 per diluted common share) recorded in the nine-month period ended September 27, 2024, and investment losses in the nine-month period ended September 26, 2025, net of investment gains in the nine-month period ended September 27, 2024, were the primary reasons for the year-over-year decline in net earnings and diluted net earnings per common share for the nine-month period ended September 26, 2025.

Current wording

The Company’s net earnings for the three-month period ended March 27, 2026 totaled approximately $1.0 billion or $1.45 per diluted common share, compared to $954 million or $1.32 per diluted common share for the three-month period ended March 28, 2025. The increase in net earnings and diluted net earnings per common share for the three-month period ended March 27, 2026 compared to the three-month period ended March 28, 2025 was primarily driven by increased core sales and lower net interest expense.

Previous wording

Currency exchange rates increased reported sales by approximately 1.5% and 1.0% for the three and nine-month periods ended September 26, 2025, respectively, compared to the comparable periods of 2024, primarily due to the exchange rates of the U.S. dollar compared to the euro and other major currencies. In future periods, strengthening of the U.S. dollar against other major currencies compared to the exchange rates in effect as of September 26, 2025 would adversely impact the Company’s sales and results of operations on an overall basis, and weakening of the U.S. dollar against other major currencies compared to the exchange rates in effect as of September 26, 2025 would positively impact the Company’s sales and results of operations. In addition to the translational exchange rate risk to sales, the Company also faces transactional exchange rate risk from transactions with customers in countries outside the U.S. and from intercompany transactions between affiliates. Transactional exchange rate risk (and any resulting gains or losses) arises from the purchase and sale of goods and services in currencies other than the Company’s functional currency or the functional currency of its applicable subsidiary.

Current wording

Currency exchange rates increased reported sales by approximately 3.0% for the three-month period ended March 27, 2026, compared to the comparable period of 2025, primarily due to the exchange rates of the U.S. dollar compared to the euro and other major currencies. In future periods, strengthening of the U.S. dollar against other major currencies compared to the exchange rates in effect as of March 27, 2026 would adversely impact the Company’s sales and results of operations on an overall basis, and weakening of the U.S. dollar against other major currencies compared to the exchange rates in effect as of March 27, 2026 would positively impact the Company’s sales and results of operations. In addition to the translational exchange rate risk to sales, the Company also faces transactional exchange rate risk from transactions with customers in countries outside the U.S. and from intercompany transactions between affiliates. Transactional exchange rate risk (and any resulting gains or losses) arises from the purchase and sale of goods and services in currencies other than the Company’s functional currency or the functional currency of its applicable subsidiary.

Previous wording

Operating profit margins increased 260 basis points from 16.5% during the three-month period ended September 27, 2024 to 19.1% for the three-month period ended September 26, 2025.

Current wording

Operating profit margins increased 40 basis points from 22.2% during the three-month period ended March 28, 2025 to 22.6% for the three-month period ended March 27, 2026.

Previous wording

•Higher third quarter 2025 core sales and improvements in leverage in the segment’s operational and administrative cost structure, net of the impact of product mix - 170 basis points

Current wording

•Higher first quarter 2026 core sales and improvements in leverage in the Company’s operational and administrative cost structure, net of the impact of product mix - 40 basis points

Previous wording

The Biotechnology segment includes the bioprocessing and discovery and medical businesses and offers a broad range of equipment, consumables and services that are primarily used by customers to advance and accelerate the research, development, manufacture and delivery of biological medicines. The Company’s solutions support a broad range of biotherapeutics including monoclonal antibodies, recombinant proteins, replacement therapies such as insulin and vaccines, as well as novel cell, gene, mRNA and other nucleic acid therapies.

Current wording

The Biotechnology segment offers a broad range of equipment, consumables, software and services that are primarily used by customers to advance and accelerate the research, development, manufacture and delivery of biological medicines. The Company’s solutions support a broad range of biotherapeutics including monoclonal antibodies, recombinant proteins, replacement therapies such as insulin and vaccines, as well as novel cell, gene, mRNA and other nucleic acid therapies.

Previous wording

Price increases in the segment contributed 2.5% and 2.0%, respectively, to sales growth on a year-over-year basis during the three and nine-month periods ended September 26, 2025 and are reflected as a component of core sales above.

Current wording

Price increases in the segment contributed 2.0% to sales growth on a year-over-year basis during the three-month period ended March 27, 2026 and are reflected as a component of core sales above.

Previous wording

Total segment sales increased 9.0% and 7.5% during the three and nine-month periods, respectively. The increase in segment sales in the three and nine-month periods was led by increased core sales and to a lesser extent by the impact of currency exchange rates. The year-over-year increase in total segment core sales in both periods was led by increased sales of consumables, partially offset by declines in equipment sales. Geographically, the increase in core sales was led by North America in the three-month period and North America and Western Europe in the nine-month period. Based on the current market conditions, the Company expects a cautious equipment spending environment through the remainder of the year.

Current wording

Total segment sales increased 11.5% during the three-month period. The increase in segment sales in the three-month period was led by increased core sales, and to a lesser extent by the impact of currency exchange rates. The year-over-year increase in total segment core sales was led by increased sales of consumables, partially offset by lower equipment sales. Geographically, the increase in core sales was led by Western Europe and China, partially offset by North America.

Previous wording

The year-over-year increase in core sales in the segment was led by high-single digit increases in core sales in the bioprocessing business in both the three and nine-month periods and was primarily driven by improved consumables demand from large pharmaceutical customers, partially offset by lower year-over-year demand for equipment. Core sales in the discovery and medical business increased year-over-year as demand for medical and lab filtration consumables more than offset lower demand for protein research equipment in the life science research end-markets.

Current wording

The year-over-year increase in core sales in the segment was led by high-single digit increases in core sales in the bioprocessing business and was primarily driven by improved consumables demand from large pharmaceutical customers, partially offset by lower equipment sales. Core sales in the discovery and medical business decreased year-over-year as increased core sales of medical filtration and research consumables was more than offset by lower core sales in protein research equipment, as academic customers continued to face funding constraints.

Previous wording

•Higher 2025 core sales, net of the impact of changes in leverage from the Company’s operations and administrative cost structure and the impact of product mix - 45 basis points

Current wording

•Higher first quarter 2026 core sales, net of the impact of changes in leverage from the Company’s operations and administrative cost structure and the impact of currency exchange rates - 140 basis points

Previous wording

Amortization of intangible assets as a percentage of sales decreased during both the three and nine-month periods ended September 26, 2025 as compared to the comparable periods of 2024, primarily as a result of the increase in sales.

Current wording

Amortization of intangible assets as a percentage of sales decreased during the three-month period ended March 27, 2026 as compared to the comparable period of 2025, primarily as a result of the increase in sales.

Previous wording

The year-over-year decrease in segment core sales in the three and nine-month periods was led by the life science consumables businesses, primarily in North America, driven by lower demand for the plasmids and mRNA product lines at two large customers and lower funding levels at emerging biotechnology and academic research customers. In the life science instruments businesses, core sales increased in the three-month period and decreased in the nine-month period, as declines in equipment demand in both periods was more than offset by increased demand for consumables and software in the three-month period. In both periods, core sales in the microscopy and mass spectrometry businesses decreased, while core sales at the flow cytometry and lab automation solutions business increased. During both periods, year-over-year core sales increased in the filtration business. In the three-month period, core sales in filtration increased in all major end-markets while in the nine-month period, increased demand in the microelectronic and aerospace end-markets more than offset decreased year-over-year demand in the energy-related end-market.

Current wording

The year-over-year increase in segment core sales in the three-month period was led by the filtration business and the life sciences consumables businesses. The year-over-year core sales increase in the filtration business was driven by increased demand in the microelectronic end-market, primarily in China. In the life sciences consumables businesses the year-over-year core sales increase was primarily driven by increased demand for plasmids products, partially offset by lower demand for gene reading and gene writing and editing products. In the life science instruments businesses, core sales decreased year-over-year as lower equipment demand more than offset increased demand for consumables, driven by the microscopy and mass spectrometry businesses.

Previous wording

Operating profit margin increased 100 basis points during the three-month period ended September 26, 2025 as compared to the comparable period of 2024.

Current wording

Operating profit margins increased 100 basis points during the three-month period ended March 27, 2026 as compared to the comparable period of 2025. Year-over-year operating profit margin was favorably impacted by higher first quarter 2026 core sales, improvements in leverage in the segment’s operational and administrative cost structure and the impact of currency exchange rates, net of the impact of product mix.

Previous wording

Sales Growth (Decline) and Core Sales Decline

Current wording

Sales Decline and Core Sales Decline

Previous wording

Price decreases in the segment of 1.5% and 1.0%, attributable to the impact of sales promotions and factors discussed below, negatively impacted the year-over-year change in sales during both the three and nine-month periods ended September 26, 2025, respectively, and are reflected as a component of core sales above.

Current wording

Price decreases in the segment of 2.0%, attributable to the volume-based procurement program in China and the impact of sales promotions, negatively impacted the year-over-year change in sales during the three-month period ended March 27, 2026 and are reflected as a component of core sales above.

Previous wording

Total segment sales increased 4.0% during the three-month period primarily as a result of increased core sales and to a lesser extent, currency exchange rates, net of the impact of divestitures. Total segment sales increased 1.0% during the nine-month period primarily as a result of increased core sales, net of the impact of divestitures. In the three and nine-month periods, the increase in segment core sales was primarily driven by increased year-over-year demand for consumables. Geographically, increased core sales in North America and most other major markets were partially offset by decreased core sales in China in both periods attributable to the pricing impact of China’s volume-based procurement program and healthcare reimbursement changes.

Current wording

Total segment sales decreased 1.5% during the three-month period primarily as a result of decreased core sales, partially offset by the impact of currency exchange rates. The decrease in segment core sales was primarily driven by decreased year-over-year demand for respiratory tests in the molecular diagnostics business, partially offset by increased demand in the clinical diagnostics businesses. Geographically, the core sales decrease was led by North America and China. The core sales decrease in China was partially attributable to the pricing impact of China’s volume-based procurement program and healthcare reimbursement changes.

Previous wording

During the three-month period, core sales growth in the molecular diagnostics business increased year-over-year primarily due to increased core sales in respiratory tests. During the nine-month period, core sales increased year-over-year as increased core sales of non-respiratory tests more than offset decreased core sales of respiratory tests. The Company believes that third quarter 2025 demand for respiratory tests was driven in part by customers purchasing in preparation for the upcoming respiratory season, which may adversely impact demand for such tests in the fourth quarter of 2025. In the segment’s clinical diagnostics businesses core sales increased during both the three and nine-month periods on a year-over-year basis, led by the pathology diagnostics business. In the clinical lab business, increased year-over-year core sales outside of China, led by North America, more than offset core sales declines in China in both the three and nine-month periods, due to the impact of China’s volume-based procurement program and healthcare reimbursement changes.

Current wording

During the three-month period ended March 27, 2026, core sales in the molecular diagnostics business declined year-over-year as increased core sales of non-respiratory tests were more than offset by decreased core sales of respiratory tests. The decreased demand for respiratory tests was driven primarily by a less severe respiratory season in the first quarter of 2026 compared to the comparable period of 2025. The relative severity of the upcoming respiratory season and the timing of customer purchases in the first quarter of 2026 in preparation of such respiratory season could adversely impact demand for such tests over the remainder of 2026. In the segment’s clinical diagnostics businesses core sales increased year-over-year in the first quarter of 2026, led by the clinical lab business, and to a lesser extent by the pathology diagnostics business. In the clinical lab businesses, increased year-over-year core sales outside of China, led by North America, more than offset core sales declines in China in the three-month period.

Previous wording

Operating profit margin decreased 120 basis points during the nine-month period ended September 26, 2025 as compared to the comparable period of 2024. The following factors unfavorably impacted year-over-year operating profit margin:

Current wording

Operating profit margin decreased 140 basis points during the three-month period ended March 27, 2026 as compared to the comparable period of 2025. The following factors unfavorably impacted year-over-year operating profit margin:

Previous wording

Cost of sales increased year-over-year during both the three and nine-month periods ended September 26, 2025 as compared to the comparable periods in 2024. The increase during both periods was primarily due to the impact of higher year-over-year sales volumes, currency exchange rates and product mix. The increase during the nine-month period also reflected a $15 million impairment charge related to a facility in the Biotechnology segment. These increases were partially offset by a $25 million acquisition-related charge associated with the fair value adjustment to inventory recorded in the first nine months of 2024 in connection with the acquisition of Abcam plc.

Current wording

Cost of sales increased year-over-year during the three-month period ended March 27, 2026 as compared to the comparable period in 2025. The increase was primarily due to the impact of higher year-over-year sales volumes and currency exchange rates. These increases were partially offset by a $15 million impairment charge related to a facility in the Biotechnology segment recorded in 2025.

Previous wording

Year-over-year gross profit margin decreased during the three-month period ended September 26, 2025 as compared to the comparable period in 2024 primarily due to product mix, the impact of currency exchange rates and tariff costs, partially offset by the impact of continued productivity improvement initiatives and higher year-over-year sales volumes. Year-over-year gross profit margin remained consistent in the nine-month period ended September 26, 2025 as compared to the comparable prior year period as higher year-over-year sales volumes and the impact of product mix were offset by the impact of currency exchange rates and tariff costs. Gross margin was also impacted by the acquisition-related charge recorded in the first nine months of 2024, net of the facility impairment recorded in the first nine months of 2025, both referenced above.

Current wording

Year-over-year gross profit margin decreased during the three-month period ended March 27, 2026 as compared to the comparable period in 2025 primarily due to product mix, the impact of currency exchange rates and tariff costs, partially offset by the impact of continued productivity improvement initiatives and higher year-over-year sales volumes. Gross margin was also impacted by the facility impairment recorded in 2025, referenced above.

Previous wording

R&D expenses (consisting principally of internal and contract engineering personnel costs) as a percentage of sales decreased during the three-month period ended September 26, 2025 and remained essentially flat during the nine-month period ended September 26, 2025 as compared to the comparable periods of 2024. The decrease in the three-month period was primarily a result of the timing of spending on new product research and the impact of higher year-over-year sales. In the nine-month period, increased R&D spending correlated to the increase in sales.

Current wording

R&D expenses (consisting principally of internal and contract engineering personnel costs) as a percentage of sales declined slightly during the three-month period ended March 27, 2026 as compared to the comparable period of 2025.

Previous wording

For a description of the Company’s other income (expense), net during the three and nine-month periods ended September 26, 2025 and September 27, 2024, refer to Note 7 to the accompanying Consolidated Condensed Financial Statements.

Current wording

For a description of the Company’s other income (expense), net during the three-month periods ended March 27, 2026 and March 28, 2025, refer to Note 7 to the accompanying Consolidated Condensed Financial Statements.

Previous wording

Interest expense of $67 million and $210 million for the three and nine-month periods ended September 26, 2025, respectively, was $20 million lower and $7 million lower than the comparable periods of 2024, due primarily to a lower average interest rate on the Company’s commercial paper borrowings versus the comparable periods of 2024, partially offset by the impact of currency exchange rates.

Current wording

Interest expense of $63 million for the three-month period ended March 27, 2026 was $9 million lower than the comparable period of 2025, due primarily to the impact of currency exchange rates and interest rates, partially offset by higher average borrowings.

Previous wording

Interest income of $3 million and $17 million for the three and nine-month periods ended September 26, 2025, respectively, was $1 million lower and $86 million lower than the comparable periods of 2024, due primarily to lower average cash balances in 2025 as a result of share repurchases.

Current wording

Interest income of $27 million for the three-month period ended March 27, 2026 was $21 million higher than the comparable period of 2025, due primarily to higher average cash balances in 2026 compared to 2025.

Previous wording

For the nine-month period ended September 27, 2024, aggregate net discrete tax benefits reduced the effective tax rate by 1.4% and related primarily to excess tax benefits from stock-based compensation, release of reserves for uncertain tax positions due to the expiration of statutes of limitation and changes in estimates associated with prior period uncertain tax positions. The effective tax rate for this period also included the tax effect from an intangible asset impairment, which reduced the effective tax rate by 0.5%.

Current wording

For the three-month period ended March 28, 2025, net discrete tax benefits of $10 million reduced the effective tax rate by 0.9% and related primarily to changes in estimates of prior year tax filing positions, release of reserves for uncertain tax positions due to the expiration of statutes of limitations and excess tax benefits from stock-based compensation, net of charges related to changes in estimates associated with prior period uncertain tax positions.

Previous wording

Comprehensive income decreased by approximately $1.2 billion and increased by approximately $1.8 billion for the three and nine-month periods ended September 26, 2025, respectively, as compared to the comparable periods of 2024. For the three-month period ended September 26, 2025, the decrease in comprehensive income was primarily driven by decreased gains from foreign currency translation adjustments, partially offset by higher net earnings. For the nine-month period ended September 26, 2025, the increase in comprehensive income was primarily driven by increased gains from foreign currency translation adjustments and, to a lesser extent, gains on cash flow hedges, partially offset by lower net earnings. The Company recorded foreign currency translation losses of $71 million and gains of approximately $1.2 billion for the three-month periods ended September 26, 2025 and September 27, 2024, respectively. The Company recorded foreign currency translation gains of approximately $2.4 billion and $389 million for the nine-month periods ended September 26, 2025 and September 27, 2024, respectively. The foreign currency translation losses in the three-month period ended September 26, 2025 were primarily driven by the change in the exchange rates between the U.S. dollar, Swedish krona and the British pound, while the gains in the nine-month period ended September 26, 2025 were primarily driven by the change in the exchange rates between the U.S. dollar, Swedish krona, the British pound and the euro. Foreign currency translation adjustments reflect the gain or loss resulting from the impact of the change in currency exchange rates on the Company’s foreign operations as they are translated to the Company’s reporting currency, the U.S. dollar. The Company recorded gains of $48 million and $217 million from cash flow hedge adjustments related to the Company’s cross-currency swap derivative contracts for the three and nine-month periods ended September 26, 2025, respectively, as compared to gains of $63 million and of $43 million for the comparable periods of 2024.

Current wording

Comprehensive income decreased by approximately $1.9 billion for the three-month period ended March 27, 2026 as compared to the comparable period of 2025. For the three-month period ended March 27, 2026, the decrease in comprehensive income was primarily driven by increased losses from foreign currency translation adjustments and decreased gains from cash flow hedge adjustments, partially offset by higher net earnings. The Company recorded foreign currency translation losses of $394 million and gains of approximately $1.4 billion for the three-month periods ended March 27, 2026 and March 28, 2025, respectively. The foreign currency translation losses in the three-month period ended March 27, 2026 were primarily driven by the change in the exchange rates between the U.S. dollar, Swedish krona and the euro. Foreign currency translation adjustments reflect the gain or loss resulting from the impact of the change in currency exchange rates on the Company’s foreign operations as they are translated to the Company’s reporting currency, the U.S. dollar. The Company recorded gains of $7 million and $156 million from cash flow hedge adjustments related to the Company’s cross-currency swap derivative contracts for the three-month periods ended March 27, 2026 and March 28, 2025, respectively.

Previous wording

Management assesses the Company’s liquidity in terms of its ability to generate cash to fund its operating, investing and financing activities. The Company continues to generate substantial cash from operating activities and believes that its operating cash flow, cash on hand and other sources of liquidity will be sufficient to allow it to continue investing in existing businesses (including capital expenditures), consummating strategic acquisitions and investments, paying interest and servicing debt, paying dividends and funding restructuring activities, as well as to repurchase common stock when deemed appropriate and manage its capital structure on a short-term and long-term basis.

Current wording

Management assesses the Company’s liquidity in terms of its ability to generate cash to fund its operating, investing and financing activities. The Company continues to generate substantial cash from operating activities and believes that its operating cash flow, cash on hand and other sources of liquidity will be sufficient to allow it to continue investing in existing businesses (including capital expenditures), consummating strategic acquisitions and investments (including the Company’s pending acquisition of Masimo, which is further described in Note 2), paying interest and servicing debt, paying dividends and funding restructuring activities, as well as to repurchase common stock when deemed appropriate and manage its capital structure on a short-term and long-term basis.

Previous wording

As of September 26, 2025, the Company held approximately $1.5 billion of cash and cash equivalents.

Current wording

As of March 27, 2026, the Company held approximately $5.7 billion of cash and cash equivalents.

Previous wording

Operating cash flows were approximately $4.3 billion for the first nine months of 2025, a decrease of $370 million, or 8%, as compared to the comparable period of 2024. The year-over-year change in operating cash flows from 2024 to 2025 was primarily attributable to the following factors:

Current wording

Operating cash flows were approximately $1.3 billion for the first three months of 2026, an increase of $23 million, or 2%, as compared to the comparable period of 2025. The year-over-year change in operating cash flows from 2025 to 2026 was primarily attributable to the following factors: