ROPER TECHNOLOGIES INC

Previous wording

•risks related to changing U.S. and foreign trade policies, including increased trade restrictions or tariffs (including repeal or non-renewal of the United States-Mexico-Canada Agreement);

Current wording

•risks related to changing U.S. and foreign trade policies, including increased trade restrictions or tariffs (including the non-renewal or a repeal of the United States-Mexico-Canada Agreement);

Previous wording

There were no material changes during the three months ended March 31, 2026 to the items that we disclosed as our critical accounting policies and estimates in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report.

Current wording

Except as described in Note 10 with respect to our equity investment in Indicor, there were no material changes during the six months ended June 30, 2026 to the items that we disclosed as our critical accounting policies and estimates in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report.

Previous wording

Net revenues for the three months ended March 31, 2026 were $2,095.3 as compared to $1,882.8 for the three months ended March 31, 2025, an increase of 11.3%. The components of revenue growth for the three months ended March 31, 2026 were as follows:

Current wording

Net revenues for the three months ended June 30, 2026 were $2,108.9 as compared to $1,943.6 for the three months ended June 30, 2025, an increase of 8.5%. The components of revenue growth for the three months ended June 30, 2026 were as follows:

Previous wording

In our Application Software segment, net revenues in the first quarter of 2026 grew 11.5% to $1,191.5 as compared to $1,068.2 in the first quarter of 2025, led by contributions from 2025 acquisitions, most notably CentralReach. The growth of 5.2% in organic revenues was broad-based across the segment, led by our application software businesses serving the legal, project-based private sector, higher education, and property and casualty insurance markets. Gross margin increased to 69.0% in the first quarter of 2026 as compared to 67.5% in the first quarter of 2025 due primarily to improved leverage on higher organic revenues as well as revenue mix. SG&A expenses as a percentage of net revenues increased to 42.2% in the first quarter of 2026 as compared to 41.6% in the first quarter of 2025 due primarily to higher amortization of acquired intangibles from the 2025 acquisition of CentralReach, partially offset by operating leverage on higher organic revenues. As a result, operating margin was 26.8% in the first quarter of 2026 as compared to 25.9% in the first quarter of 2025.

Current wording

In our Application Software segment, net revenues in the second quarter of 2026 grew 7.8% to $1,180.8 as compared to $1,094.9 in the second quarter of 2025. The growth of 4.5% in organic revenues was broad-based across the segment, led by our application software businesses serving the legal, project-based private sector, property and casualty insurance, higher education, and acute healthcare markets. Growth from acquisitions was led by our 2025 acquisitions of CentralReach and Orchard Software. Gross margin increased to 69.8% in the second quarter of 2026 as compared to 68.8% in the second quarter of 2025 due primarily to improved leverage on higher organic revenues. SG&A expenses as a percentage of net revenues increased to 42.3% in the second quarter of 2026 as compared to 41.9% in the second quarter of 2025 due primarily to higher amortization of acquired intangibles from the 2025 acquisition of CentralReach, partially offset by improved operating leverage on higher revenues. As a result, operating margin was 27.4% in the second quarter of 2026 as compared to 26.9% in the second quarter of 2025.

Previous wording

In our Network Software segment, net revenues in the first quarter of 2026 grew 13.8% to $427.6 as compared to $375.9 in the first quarter of 2025, led by contributions from 2025 acquisitions, most notably Subsplash. The growth of 5.2% in organic revenues was broad-based across the segment, led by our network software businesses serving the freight match, construction, and alternate site healthcare markets. Gross margin increased to 84.3% in the first quarter of 2026 as compared to 84.0% in the first quarter of 2025 due primarily to lower amortization associated with fully amortized acquired intangibles and improved leverage on higher organic revenues, partially offset by margin profiles associated with our 2025 acquisitions, most notably payments revenue mix from Subsplash and the Convoy platform within our freight match software business. SG&A expenses as a percentage of net revenues increased to 43.6% in the first quarter of 2026 as compared to 39.6% in the first quarter of 2025 due primarily to SG&A profiles associated with our 2025 acquisitions, including higher amortization of acquired intangibles. As a result, operating margin was 40.6% in the first quarter of 2026 as compared to 44.3% in the first quarter of 2025.

Current wording

In our Network Software segment, net revenues in the second quarter of 2026 grew 11.8% to $430.9 as compared to $385.4 in the second quarter of 2025, led by contributions from 2025 acquisitions, most notably Subsplash. The growth of 3.6% in organic revenues was led by our network software businesses serving the freight match, construction, and media and entertainment markets. These increases were partially offset by declines in our alternate site group purchasing business and non-recurring professional services revenue at our business serving the life insurance/annuities market. Gross margin increased to 84.3% in the second quarter of 2026 as compared to 83.2% in the second quarter of 2025 due primarily to lower amortization associated with fully amortized acquired intangibles, partially offset by margin profiles associated with our 2025 acquisitions, most notably payments revenue mix from Subsplash as well as the Convoy platform within our freight match software business. SG&A expenses as a percentage of net revenues increased to 43.4% in the second quarter of 2026 as compared to 39.3% in the second quarter of 2025 due primarily to SG&A profiles associated with our 2025 acquisitions, including higher amortization of acquired intangibles. As a result, operating margin was 41.0% in the second quarter of 2026 as compared to 43.9% in the second quarter of 2025.

Previous wording

In our Technology Enabled Products segment, net revenues in the first quarter of 2026 grew 8.5% to $476.2 as compared to $438.7 in the first quarter of 2025. The growth of 7.1% in organic revenues was led by our medical products businesses, highlighted by our precision measurement and airway management businesses. These increases were partially offset by a decline in our water meter technology business. Gross margin decreased to 56.9% in the first quarter of 2026 as compared to 58.7% in the first quarter of 2025 due primarily to revenue mix within our medical products businesses weighted more towards consumables and input cost pressures at our water meter technology business. SG&A expenses as a percentage of net revenues increased to 24.4% in the first quarter of 2026 as compared to 23.6% in the first quarter of 2025 due primarily to reduced operating leverage associated with our water meter technology business. The resulting operating margin was 32.4% in the first quarter of 2026 as compared to 35.0% in the first quarter of 2025.

Current wording

In our Technology Enabled Products segment, net revenues in the second quarter of 2026 grew 7.3% to $497.2 as compared to $463.3 in the second quarter of 2025. The growth of 7.1% in organic revenues was led by our medical products businesses, highlighted by our precision measurement and airway management businesses. These increases were partially offset by an expected decline in our water meter technology business. Gross margin decreased to 56.9% in the second quarter of 2026 as compared to 58.6% in the second quarter of 2025 due primarily to input cost pressures at our water meter technology business and revenue mix within our medical products businesses weighted more towards consumables. SG&A expenses as a percentage of net revenues increased to 23.6% in the second quarter of 2026 as compared to 23.1% in the second quarter of 2025 due primarily to reduced operating leverage associated with our water meter technology business. The resulting operating margin was 33.3% in the second quarter of 2026 as compared to 35.4% in the second quarter of 2025.

Previous wording

Corporate expenses increased to $77.8 in the first quarter of 2026 as compared to $71.3 in the first quarter of 2025. The dollar increase was due primarily to higher stock-based compensation expense, partially offset by a reduction in fees for professional services. As a percentage of net revenues, corporate expenses decreased to 3.7% of net revenues in the first quarter of 2026 as compared to 3.8% of net revenues in the first quarter of 2025.

Current wording

Corporate expenses increased to $81.6 in the second quarter of 2026 as compared to $79.7 in the second quarter of 2025. The dollar increase was due primarily to higher stock-based compensation expense, partially offset by lower acquisition-related expenses. As a percentage of net revenues, corporate expenses decreased to 3.9% of net revenues in the second quarter of 2026 as compared to 4.1% of net revenues in the second quarter of 2025.

Previous wording

Interest expense, net, increased to $99.3 for the first quarter of 2026 as compared to $62.9 for the first quarter of 2025 due primarily to higher average debt balances and a higher weighted-average interest rate on our senior notes.

Current wording

Interest expense, net, increased to $111.4 for the second quarter of 2026 as compared to $79.1 for the second quarter of 2025 due primarily to higher average debt balances and a higher weighted-average interest rate on our senior notes.

Previous wording

Equity investment activity, net, was a gain of $167.3 in the first quarter of 2026 due to an increase in the fair value of our equity investment in Indicor. Equity investment activity, net, was a loss of $44.4 in the first quarter of 2025 due primarily to a decrease in the fair value of our equity investment in Indicor. Changes in the fair value of our Indicor equity investment are primarily due to Indicor’s financial performance as well as fluctuations in the equity values of comparable guideline public companies.

Current wording

Equity investment activity, net, was a gain of $835.2 in the second quarter of 2026 due primarily to an $828.6 increase in the fair value of our equity investment in Indicor. The increase was primarily due to updated valuation assumptions made in anticipation of Indicor’s planned divestiture of its portfolio of instrumentation businesses (“Indicor Instrumentation”). Equity investment activity, net, was a gain of $16.6 in the second quarter of 2025 due to an increase in the fair value of our equity investment in Indicor and dividend distributions received from Indicor.

Previous wording

Income taxes as a percentage of pretax earnings decreased to 19.9% for the first quarter of 2026 as compared to 20.8% for the first quarter of 2025, due primarily to favorable rate impact from the recognition of a net tax benefit associated with legal entity restructuring, partially offset by a reduction in stock-based compensation tax benefits.

Current wording

Income taxes as a percentage of pretax earnings decreased to 10.7% for the second quarter of 2026 as compared to 22.0% for the second quarter of 2025, primarily due to net tax benefits recognized in connection with a change in our outside basis in Indicor, resulting from the Indicor Instrumentation transaction described above, and legal entity restructuring.

Previous wording

Backlog is equal to our remaining performance obligations expected to be recognized as revenue within the next 12 months as discussed in Note 13 of the Notes to Condensed Consolidated Financial Statements. Backlog increased 11.8% to $3,392.1 at March 31, 2026 as compared to $3,033.8 at March 31, 2025 due primarily to acquisitions and organic growth in our software segments.

Current wording

Backlog is equal to our remaining performance obligations expected to be recognized as revenue within the next 12 months as discussed in Note 13 of the Notes to Condensed Consolidated Financial Statements. Backlog increased 11.0% to $3,286.0 at June 30, 2026 as compared to $2,961.3 at June 30, 2025 due primarily to acquisitions and organic growth in our software segments.

Previous wording

All currency amounts are in millions, except per share data

Current wording

All currency amounts are in millions, except per share data or as otherwise specified

Previous wording

Selected cash flows for the three months ended March 31, 2026 and 2025 were as follows:

Current wording

Selected cash flows for the six months ended June 30, 2026 and 2025 were as follows:

Previous wording

Cash used in investing activities during the three months ended March 31, 2026 was primarily for a business acquisition, capitalized software expenditures, and capital expenditures. Cash used in investing activities during the three months ended March 31, 2025 was primarily for the acquisition of Muni-Link.

Current wording

Cash used in investing activities during the six months ended June 30, 2026 was primarily for capitalized software expenditures, capital expenditures, and a business acquisition. Cash used in investing activities during the six months ended June 30, 2025 was primarily for the acquisitions of CentralReach, Muni-Link, and Outgo.

Previous wording

Cash used in financing activities during the three months ended March 31, 2026 primarily consisted of repurchases of our common stock as well as dividend payments, partially offset by net borrowings under our unsecured revolving credit facility. Cash used in financing activities during the three months ended March 31, 2025 was primarily for net repayments on our unsecured revolving credit facility and dividend payments.

Current wording

Cash used in financing activities during the six months ended June 30, 2026 primarily consisted of repurchases of our common stock as well as dividend payments, partially offset by net borrowings under our unsecured revolving credit facility. Cash provided by financing activities during the six months ended June 30, 2025 was primarily from net borrowings under our unsecured revolving credit facility to fund the acquisition of CentralReach, and net proceeds from stock-based compensation, partially offset by dividend payments.

Previous wording

Net working capital (total current assets, excluding cash, less total current liabilities, excluding debt) was negative $1,332.8 at March 31, 2026 as compared to negative $1,389.7 at December 31, 2025. The change in net working capital was primarily driven by a decrease in deferred revenue predominantly due to the timing of SaaS renewals associated with our Frontline business, the timing of payments associated with incentive compensation and interest payments on our senior notes, partially offset by a decrease in accounts receivable and changes in tax-related balances.

Current wording

Net working capital (total current assets, excluding cash, less total current liabilities, excluding debt) was negative $1,198.6 at June 30, 2026 as compared to negative $1,389.7 at December 31, 2025. The change in net working capital was primarily driven by a decrease in deferred revenue predominantly due to the timing of SaaS renewals associated with our Frontline business, and the timing of payments associated with incentive compensation, partially offset by a decrease in accounts receivable.

Previous wording

On March 30, 2026, we entered into the Credit Agreement, which replaced the previous $3,500.0 unsecured credit facility, dated as of July 21, 2022. The Credit Agreement comprises a five-year $3,500.0 unsecured revolving credit facility, which includes availability of up to $150.0 for letters of credit. Loans under the unsecured credit facility are available in dollars, and letters of credit will be available in dollars and other currencies to be agreed. We may also, subject to compliance with specified conditions, request additional term loans or revolving credit commitments in an aggregate amount not to exceed $1,000.0.

Current wording

On March 30, 2026, the Company entered into the Credit Agreement, which replaced the previous $3,500.0 unsecured credit facility, dated as of July 21, 2022. The Credit Agreement comprises a five-year $3,500.0 unsecured revolving credit facility, which includes availability of up to $150.0 for letters of credit. Loans under the unsecured credit facility are available in dollars, and letters of credit will be available in dollars and other currencies to be agreed. We may also, subject to compliance with specified conditions, request additional term loans or revolving credit commitments in an aggregate amount not to exceed $1,000.0.

Previous wording

The interest rate on borrowings under the new $3,500.0 unsecured revolving credit facility is calculated based upon various recognized indices plus a margin as defined in the Credit Agreement. At March 31, 2026, we had $7.1 of outstanding letters of credit.

Current wording

The interest rate on borrowings under the new $3,500.0 unsecured revolving credit facility is calculated based upon various recognized indices plus a margin as defined in the Credit Agreement. At June 30, 2026, we had $7.0 of outstanding letters of credit.

Previous wording

We were in compliance with all debt covenants related to our new and previous unsecured credit facilities throughout their respective periods of effectiveness during the three months ended March 31, 2026.

Current wording

We were in compliance with all debt covenants related to our new and previous unsecured credit facilities throughout their respective periods of effectiveness during the six months ended June 30, 2026.

Previous wording

Total debt, net of deferred financing costs was $10,464.0 at March 31, 2026 as compared to $9,301.0 at December 31, 2025. Our total debt increased at March 31, 2026 as compared to December 31, 2025 due primarily to net borrowings of $1,150.0 on our unsecured revolving credit facility. Our leverage is presented in the following table:

Current wording

Total debt, net of deferred financing costs was $11,319.4 at June 30, 2026 as compared to $9,301.0 at December 31, 2025. Our total debt increased at June 30, 2026 as compared to December 31, 2025 due primarily to net borrowings of $2,000.0 on our unsecured revolving credit facility. Our leverage is presented in the following table:

Previous wording

In relation to our total cash and cash equivalents, amounts held at our foreign subsidiaries represented 51.9% or $198.8 at March 31, 2026 as compared to 57.6% or $171.2 at December 31, 2025. The increase in foreign cash and cash equivalents was primarily due to cash generated at our foreign subsidiaries during the three months ended March 31, 2026, partially offset by cash repatriation of $40.0. We intend to repatriate substantially all historical and future foreign earnings that can be repatriated without incremental U.S. federal tax cost.

Current wording

In relation to our total cash and cash equivalents, amounts held at our foreign subsidiaries represented 47.8% or $174.6 at June 30, 2026 as compared to 57.6% or $171.2 at December 31, 2025. The increase in the amount of foreign cash and cash equivalents was primarily due to cash generated at our foreign subsidiaries during the six months ended June 30, 2026, partially offset by cash repatriation of $140.0. We intend to repatriate substantially all historical and future foreign earnings that can be repatriated without incremental U.S. federal tax cost.

Previous wording

Capital expenditures were $14.3 for the three months ended March 31, 2026 as compared to $9.5 for the three months ended March 31, 2025. Capitalized software expenditures were $15.4 for the three months ended March 31, 2026 as compared to $12.4 for the three months ended March 31, 2025. We expect the aggregate of capital expenditures and capitalized software expenditures for 2026 to be comparable to prior years as a percentage of net revenues.

Current wording

Capital expenditures were $25.3 for the six months ended June 30, 2026 as compared to $26.0 for the six months ended June 30, 2025. Capitalized software expenditures were $30.9 for the six months ended June 30, 2026 as compared to $26.8 for the six months ended June 30, 2025. We expect the aggregate of capital expenditures and capitalized software expenditures for 2026 to be comparable to prior years as a percentage of net revenues.

Previous wording

On July 4, 2025, the U.S. government enacted H.R. 1, the One Big Beautiful Bill Act (the “OBBBA”), which introduced tax reform provisions that amend, eliminate, or extend certain tax rules under the Inflation Reduction Act and the Tax Cuts and Jobs Act. Legislative changes include the repeal of the requirement to capitalize and amortize domestic research and development expenditures under Internal Revenue Code Section 174. The legislation includes multiple effective dates and, as enacted, did not have a material impact on our effective tax rate in the first quarter of 2026 and is not expected to have a significant impact on our annual effective tax rate in full year 2026 or thereafter. We continue to assess the broader impacts of the OBBBA.

Current wording

On July 4, 2025, the U.S. government enacted H.R. 1, the One Big Beautiful Bill Act, which introduced tax reform provisions that amend, eliminate, or extend certain tax rules under the Inflation Reduction Act and the Tax Cuts and Jobs Act. Legislative changes include the repeal of the requirement to capitalize and amortize domestic research and development expenditures under Internal Revenue Code Section 174. The legislation includes multiple effective dates and, as enacted, did not have a material impact on our effective tax rates for the three or six months ended June 30, 2026, and is not expected to have a significant impact on our annual effective tax rate in full year 2026 or thereafter.

Previous wording

In April 2026, our Board approved an additional $3,000.0 in share repurchase authorization under the program. As of April 30, 2026, total share repurchase authorization of $3,471.6 remained available for future repurchases under the program.

Current wording

In April 2026, our Board approved an additional $3,000.0 in share repurchase authorization under the share repurchase program.

Previous wording

During the three months ended March 31, 2026, we repurchased 4.274 shares of our common stock for an aggregate purchase price of $1,500.0 and an average price paid per share of $350.99, excluding excise tax and broker commissions. As of March 31, 2026, $1,000.0 of the originally authorized amount remained available for future repurchases under the share repurchase program.

Current wording

During the six months ended June 30, 2026, we repurchased 7.865 shares of our common stock for an aggregate purchase price of $2,724.1 and an average price paid per share of $346.34, excluding excise tax and broker commissions. As of June 30, 2026, $2,775.9 of the total amount authorized under the share repurchase program remained available for future repurchases.