IDEXX LABORATORIES INC /DE

We believe that the long-term financial potential of our business is significant, as reflected in the model below:*

We aim to achieve these financial goals over the long term by successfully executing our Purpose-driven strategy:

+Focus on Developing the Highly Attractive Global Pet Healthcare Space—Global pet healthcare has excellent long-term secular growth characteristics. In fact, we estimate that the total global addressable companion animal diagnostics revenue opportunity is approximately$45+ billion, with approximately two-thirds of this estimated opportunity located outside the U.S. We seek to expand and realize that opportunity by bringing innovative products and services to market and driving their broad adoption.

+Advancement of Innovation—Through our sustained focus on research and development (R&D) and our customers’ needs, we have introduced innovative diagnostic and software products and services designed to advance global pet healthcare standards of care and enable veterinary practices to improve productivity and engage more effectively with pet owners. In addition, our innovative diagnostic solutions are fully backed by peer-reviewed and third-party studies, where feasible, that objectively confirm their claims and capabilities.

+Customer Engagement and Experience—We have the largest and most experienced companion animal diagnostics field‑based professional organization in the world, which enables us to develop and strengthen our relationships with our customers, including individual veterinary professionals, and to drive broader and faster adoption of our innovations. In addition, we focus on providing a first-class customer experience, evidenced by our Net Promoter Score of 57 from our U.S. veterinary practice customers.† We continue to invest in our customer experience and commercial capabilities, both in the U.S. and key international regions.

+Expansion of Recurring Revenue Business Model—Our business is designed around a durable, recurring revenue business model, with robust growth and profit characteristics and supported by our extraordinary customer loyalty and high retention rates. The largest contributor to our total revenue is our CAG Diagnostics recurring revenue, which constituted approximately 79% of our total 2025 revenue. Another key driver of recurring revenue is our Veterinary Software, Services and Diagnostic Imaging recurring revenue, which represented 6% of our total 2025 revenue and grew approximately 10% in 2025, as compared to 2024.

+Commitment to Sustained Growth in Financial Performance—We have a track record over the long term of organic revenue growth and operating margin expansion, strong free cash flow generation and a disciplined approach to capital allocation. As a result, our investments in our business yielded a 50.2% ROIC in 2025.††

Highly Attractive Global Pet Healthcare Factors and Trends+The enduring pet-owner bond, which is strengthening across successive generations of pet owners.+Pet owners’ desire to support the health and well-being of companions that many consider part of their families and their willingness to commit their time and money toward veterinary care.+Global pet population growth, which accelerated during the pandemic, and a shift in canine breed preferences towards breeds that incur greater medical costs.+Increasing average lifespans of pets, resulting in aging pets forming a larger portion of the pet population.+Veterinary care providers’ ever-advancing ability and intent to provide a high medical standard of care, including increased focus on services offered within the clinic.+Our diagnostic and software innovations that:◦Expand veterinarians’ medical toolkit, including artificial intelligence-powered diagnostic insights and support.◦Enable pets—who cannot speak for themselves—to communicate more precisely their health status and problems.◦Support increased productivity and efficiency in veterinary clinic workflows and more effective, technology-enabled engagement with pet owners.

• Our long-term financial potential model represents our projected annual gains, assuming constant foreign currency exchange rates and excluding year-over-year changes in share-based compensation tax benefits and non-recurring or unusual items.

† Net Promoter Score is determined by asking survey respondents how likely they are, on a scale of zero to ten, to recommend the IDEXX brand to a colleague and then calculating the score as the percent of respondents who are “promoters” (providing a response of nine or ten) and subtracting the percent of respondents who are “detractors” (providing a response of zero to six).

†† Information regarding ROIC and its calculation is provided in Appendix A.