WESCO INTERNATIONAL INC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. ORGANIZATION

WESCO International, Inc. (“Wesco International”) and its subsidiaries (collectively, “Wesco” or the “Company”), headquartered in Pittsburgh, Pennsylvania, is a leading provider of business-to-business distribution, logistics services and supply chain solutions.

The Company has operating segments comprising three strategic business units consisting of Electrical & Electronic Solutions (“EES”), Communications & Security Solutions (“CSS”) and Utility & Broadband Solutions (“UBS”).

2. ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements of Wesco have been prepared in accordance with Rule 10-01 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). The unaudited condensed consolidated financial information should be read in conjunction with the audited Consolidated Financial Statements and Notes thereto included in WESCO International, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on February 13, 2026. The Condensed Consolidated Balance Sheet at December 31, 2025 was derived from the audited Consolidated Financial Statements as of that date, but does not include all the disclosures required by accounting principles generally accepted in the United States of America.

The unaudited Condensed Consolidated Balance Sheet as of September 30, 2026, the unaudited Condensed Consolidated Statements of Income and Comprehensive Income, the unaudited Condensed Consolidated Statements of Equity for the three and nine months ended September 30, 2026 and 2025, and the unaudited Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2026 and 2025, respectively, in the opinion of management, have been prepared on the same basis as the audited Consolidated Financial Statements and include all adjustments necessary for the fair statement of the results of the interim periods presented herein. All adjustments reflected in the unaudited condensed consolidated financial information are of a normal recurring nature unless indicated. The results for the interim periods presented herein are not necessarily indicative of the results to be expected for the full year.

Recently Issued Accounting Standards

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which is intended to enhance expense disclosures, primarily by requiring disclosure of disaggregated information about certain income statement expense line items on an annual and interim basis. The amendments in this ASU are effective for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027. The amendments in this ASU should be applied prospectively; however, retrospective application is permitted. Management is currently evaluating the impact that this accounting standard will have on its consolidated financial statements and notes thereto.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which is intended to modernize and simplify the guidance for capitalizing costs related to internal-use software by removing the stage-based approach and aligning the disclosure requirements with those for other long-lived assets. The amendments in this ASU are effective for annual periods beginning after December 15, 2027 and may be applied prospectively, retrospectively, or using a modified prospective approach. Early adoption is permitted. Management is currently evaluating the timing of the adoption of this accounting standard and the impact that it will have on its consolidated financial statements and notes thereto.

Other pronouncements issued by the FASB or other authoritative accounting standards groups with future effective dates are either not applicable or are not expected to be material to Wesco’s financial position, results of operations or cash flows.

3. REVENUE

Wesco distributes products and provides services to customers globally in various end markets within its business segments. The segments operate in the United States, Canada and various other countries.

The following table disaggregates Wesco’s Net sales by geography for the periods presented:

(1)No individual country's net sales are greater than 10% of total Net sales.

(2)Wesco attributes revenues from external customers to individual countries on the basis of point of sale.

Due to the terms of certain contractual arrangements, Wesco bills or receives payment from its customers in advance of satisfying the respective performance obligation. Such advance billings or payments are recorded as deferred revenue and recognized as revenue when the performance obligation has been satisfied and control has transferred to the customer, which is generally upon shipment. Revenue associated with these arrangements is generally recognized within a year or less from the date of the advance billing or payment receipt. At September 30, 2026, December 31, 2025 and December 31, 2024, $293.5 million, $151.4 million and $141.8 million, respectively, of deferred revenue was recorded as a component of Other current liabilities in the unaudited Condensed Consolidated Balance Sheets. At September 30, 2026, $151.7 million of deferred revenue was recorded as a component of Other noncurrent liabilities in the unaudited Condensed Consolidated Balance Sheet. The deferred revenue recorded as a component of Other noncurrent liabilities in the Condensed Consolidated Balance Sheets at December 31, 2025 and December 31, 2024 was not material.

The following table sets forth the amount of revenue that was recognized in the periods presented that was included in the deferred revenue balance at the beginning of the period:

Wesco’s revenues are adjusted for variable consideration, which includes customer volume rebates, returns and discounts. Wesco measures variable consideration by estimating expected outcomes using analysis and inputs based upon historical data, as well as current and forecasted information. Variable consideration is reviewed by management on a monthly basis and revenue is adjusted as necessary. Variable consideration reduced revenue by approximately $134.8 million and $112.8 million, for the three months ended September 30, 2026 and 2025, respectively, and by approximately $377.6 million and $335.2 million for the nine months ended September 30, 2026 and 2025, respectively. As of September 30, 2026 and December 31, 2025, the Company's estimated product return obligation was $40.1 million and $33.7 million, respectively.

Billings to customers for shipping and handling are recognized in Net sales. Wesco has elected to recognize shipping and handling costs as a fulfillment cost. Shipping and handling costs recorded as a component of Selling, general and administrative (“SG&A”) expenses totaled $102.5 million and $90.7 million for the three months ended September 30, 2026 and 2025, respectively, and $286.9 million and $251.1 million for the nine months ended September 30, 2026 and 2025, respectively.

4. ACQUISITION

Newark Engineering Group

On July 1, 2026, the Company acquired 100% of the equity securities of Newark Engineering Group (“Newark”), a Singapore-based provider of engineered cooling solutions and lifecycle services for data centers for total cash consideration of $127.7 million, net of cash acquired. Newark brings specialized expertise in designing, installing and maintaining advanced thermal management systems critical to data center performance and reliability. This acquisition expands the Company's participation in the data center value chain while strengthening the Company's presence across Southeast Asia. The Company funded the purchase price paid at closing with cash on hand as well as borrowings under its revolving credit facility. The assets acquired primarily include a customer relationships intangible asset with an estimated fair value of $65.5 million, which was determined using an income-based valuation approach. In addition, goodwill in the amount of $63.9 million was allocated to the Company’s CSS reportable segment.

5. GOODWILL AND INTANGIBLE ASSETS

The following table sets forth the changes in the carrying value of goodwill by reportable segment, which correspond to our reporting units, for the period presented:

The components of intangible assets are as follows:

(1)Excludes the original cost and related accumulated amortization of fully-amortized intangible assets.

Amortization expense related to intangible assets totaled $22.4 million for the three months ended September 30, 2026 and 2025, and $65.2 million and $66.9 million for the nine months ended September 30, 2026 and 2025, respectively.

The following table sets forth the remaining estimated amortization expense for intangible assets for the next five years and thereafter:

6. STOCK-BASED COMPENSATION

Wesco’s stock-based compensation awards consist of stock options, stock-settled stock appreciation rights, restricted stock units and performance-based awards. Compensation cost for all stock-based awards is measured at fair value on the date of grant and compensation cost is recognized, net of estimated forfeitures, over the service period for awards expected to vest. The fair value of stock options and stock-settled stock appreciation rights is determined using the Black-Scholes model. The fair value of restricted stock units is determined by the grant-date closing price of Wesco’s common stock. The fair value of performance-based awards with performance conditions is determined by a Monte Carlo simulation as well as the grant-date closing price of Wesco’s common stock. The forfeiture assumption is based on Wesco’s historical participant behavior that is reviewed on at least an annual basis. For stock options and stock-settled stock appreciation rights that are exercised, and for restricted stock units and performance-based awards that vest, shares are issued out of Wesco's outstanding common stock.

Stock options and stock-settled stock appreciation rights vest ratably over a three-year period and terminate on the tenth anniversary of the grant date unless terminated sooner under certain conditions. Restricted stock units awarded under the WESCO International, Inc. 2021 Omnibus Incentive Plan, which was adopted on May 27, 2021, typically vest ratably over a three-year period on each of the first, second and third anniversaries of the grant date. Vesting of performance-based awards is based on a three-year performance period, and the number of shares earned, if any, depends on the attainment of certain performance levels, as described below. Outstanding awards would vest upon the consummation of a change in control transaction, with performance-based awards vesting at the greater of the target level or actual.

The 2024 performance-based awards are based on two equally weighted performance measures: the three-year average growth rate of Wesco’s net income attributable to common stockholders and the three-year cumulative return on net assets. The 2025 and 2026 performance-based awards are based on two equally weighted performance measures: the growth rate of Wesco’s earnings per share and return on net assets, both of which are measured on an annual basis as well as on a three-year cumulative basis, with each of the three years and the three-year cumulative measurement equally weighted. The 2025 and 2026 performance-based awards also include a relative Total Stockholder Return (“TSR”) modifier that impacts the number of shares earned based on the Company's TSR over the performance period in relation to the TSR of the companies comprising the S&P MidCap 400 Index. These awards are accounted for as awards with performance conditions; compensation cost is recognized over the performance period based upon Wesco’s determination of whether it is probable that the performance targets will be achieved. The fair value of the relative TSR modifier as of each grant date for the 2025 and 2026 awards was measured using a Monte Carlo simulation.

During the three and nine months ended September 30, 2026 and 2025, Wesco granted the following stock options, restricted stock units, and performance-based awards at the following weighted-average fair values:

The fair values of stock options, as disclosed in the table above, were estimated using the following weighted-average assumptions in the respective periods:

The risk-free interest rate is based on the U.S. Treasury Daily Yield Curve rate as of the grant date. The expected life is based on historical exercise experience, the expected volatility is based on the volatility of the Company’s daily stock price over the expected life preceding the grant date of the award, and the expected dividend yield is based on the calculated yield on the Company’s common stock at the date of grant using the then current fiscal year projected dividend distribution rate.

The following table sets forth a summary of stock options and related information for the nine months ended September 30, 2026:

For the nine months ended September 30, 2026, the aggregate intrinsic value of stock options exercised during such period was $4.6 million.

The following table sets forth a summary of stock-settled stock appreciation rights and related information for the nine months ended September 30, 2026:

For the nine months ended September 30, 2026, the aggregate intrinsic value of stock-settled stock appreciation rights exercised during such period was $74.7 million.

The following table sets forth a summary of restricted stock units and related information for the nine months ended September 30, 2026:

The following table sets forth a summary of performance-based awards and related information for the nine months ended September 30, 2026:

Wesco recognized $20.7 million and $10.7 million of non-cash stock-based compensation expense for the three months ended September 30, 2026 and 2025, respectively, and $55.9 million and $29.3 million of non-cash stock-based compensation expense for the nine months ended September 30, 2026 and 2025, respectively, which is included in SG&A expenses for such periods. As of September 30, 2026, there was $93.0 million of total unrecognized compensation expense related to unvested stock-based compensation arrangements for all awards previously made, which is expected to be recognized as follows:

7. STOCKHOLDERS’ EQUITY

Share Repurchases

On May 31, 2022, the Company’s Board of Directors adopted a resolution authorizing the repurchase of up to $1 billion of the Company’s common stock and 10.625% Series A Fixed-Rate Reset Cumulative Perpetual Preferred Stock (the “Series A Preferred Stock”). The share repurchase authorization has no expiration date and may be modified, suspended, or terminated at any time without prior notice.

During the three and nine months ended September 30, 2026, the Company entered into spot repurchase transactions through a broker to purchase 73,167 and 238,052 shares of its common stock, respectively, in the open market for cash totaling $25.2 million and $75.8 million, respectively, including excise taxes. Wesco funded the repurchases with available cash and borrowings under its accounts receivable securitization and revolving credit facilities. During the three and nine months ended September 30, 2025, the Company entered into spot repurchase transactions through a broker to purchase 119,042 and 419,570 shares of its common stock, respectively, in the open market for cash totaling $25.3 million and $75.8 million, respectively, including excise taxes. Wesco funded the repurchases with available cash and borrowings under its accounts receivable securitization and revolving credit facilities.

Series A Preferred Stock Redemption

On February 13, 2025, the Company's Board of Directors adopted a resolution authorizing the redemption of all outstanding shares of the Company's Series A Preferred Stock. As this authorization was separate from the May 31, 2022 share purchase authorization noted above, the redemption of Series A Preferred Stock did not impact the approximate dollar value of shares that may be repurchased under the earlier 2022 authorization.

As of June 22, 2025, the Company redeemed all 21,612 outstanding shares of its Series A Preferred Stock, and the related depositary shares, each representing 1/1,000th of one share of Series A Preferred Stock, at a redemption price of $25,000 per share, for a total payment of $540.3 million. The Company recognized a $27.6 million gain from the redemption as income attributable to common stockholders. Wesco funded the redemption with the net proceeds from the March 2025 issuance of the 6.375% senior notes due 2033.

Dividends

The Company’s dividends on common stock are declared at the discretion of the Board of Directors. The following table is a summary of cash dividends declared and paid on the Company’s common stock for the nine months ended September 30, 2026:

The following table is a summary of cash dividends declared and paid on the Company’s common stock for the nine months ended September 30, 2025:

No quarterly cash dividends were paid on the Company’s Series A Preferred Stock during the three and nine months ended September 30, 2026 or the three months ended September 30, 2025, as the Series A Preferred Stock was redeemed in June 2025. During the nine months ended September 30, 2025, the Company's Board of Directors declared and the Company paid cash dividends relating to its Series A Preferred Stock totaling $27.3 million. As a result of the redemption, for the three months ended June 30, 2025, the dividend rate per depositary share was prorated to $0.598, compared to the prior period dividend rates of $0.664.

8. EARNINGS PER SHARE

Basic earnings per share is computed by dividing net income attributable to common stockholders by the weighted-average number of common shares outstanding during the periods. Diluted earnings per share is computed by dividing net income attributable to common stockholders by the weighted-average common shares and common share equivalents outstanding during the periods. The dilutive effect of common share equivalents is considered in the diluted earnings per share computation using the treasury stock method, which includes consideration of equity awards.

The following table sets forth the computation of Basic and Diluted earnings per share for the periods presented:

The computation of diluted earnings per share attributable to common stockholders excludes stock-based awards that would have had an antidilutive effect on earnings per share. For the three months ended September 30, 2026, there were approximately 0.1 million antidilutive shares. For the nine months ended September 30, 2026, the number of antidilutive shares was immaterial. For the three and nine months ended September 30, 2025, there were approximately 0.1 million and 0.2 million antidilutive shares, respectively.

9. DEBT

The following table sets forth Wesco's outstanding indebtedness:

Accounts Receivable Securitization Facility

On September 17, 2026, WESCO Distribution, Inc. (“Wesco Distribution”) amended its accounts receivable securitization facility (the “Receivables Facility”) pursuant to the terms and conditions of a Tenth Amendment to Fifth Amended and Restated Receivables Purchase Agreement (the “Tenth Receivables Amendment”), by and among WESCO Receivables Corp., Wesco Distribution, the various purchasers and purchaser agents party thereto and PNC Bank, National Association, as administrator. The Tenth Receivables Amendment modified the receivables purchase agreement originally entered into on June 22, 2020 to, among other things, (i) extend the scheduled termination date of the Receivables Facility to September 17, 2029, (ii) increase the purchase limit under the Receivables Facility from $1,550 million to $1,750 million, and (iii) decrease the drawn spread applicable to investments funded under the Receivables Facility. No other material terms were changed.

Revolving Credit Facility

On September 17, 2026, Wesco Distribution amended its revolving credit facility (the “Revolving Credit Facility”) pursuant to the terms and conditions of the Ninth Amendment to Fourth Amended and Restated Credit Agreement (the “Ninth Revolver Amendment”), by and among Wesco Distribution, the other U.S. borrowers party thereto, WESCO Distribution Canada LP, the other Canadian borrowers party thereto, Wesco, the lenders party thereto and Barclays Bank PLC, as administrative agent. The Ninth Revolver Amendment amended the revolving credit agreement originally entered into on June 22, 2020, to, among other things, (i) extend the maturity date of the Revolving Credit Facility to September 17, 2031, (ii) increase the revolving commitments under the Revolving Credit Facility from $1,725 million to $1,850 million, (iii) decrease the interest rate spreads applicable to borrowings under the Revolving Credit Facility, and (iv) increase certain negative covenant baskets. No other material terms were changed.

7.250% Senior Notes due 2028

On April 29, 2026, Wesco Distribution exercised its right to redeem the entire outstanding $1,325 million aggregate principal amount of the 7.250% Senior Notes due 2028 (the “2028 Notes”), and U.S. Bank Trust Company, National Association, as successor to U.S. Bank National Association, as trustee under the 2028 Notes Indenture, issued a notice of redemption to registered holders of the 2028 Notes.

On June 15, 2026, Wesco Distribution redeemed the $1,325 million aggregate principal amount of the 2028 Notes at a redemption price equal to 100% of the principal amount plus accrued interest up to, but not including, June 15, 2026. The redemption of the 2028 Notes was funded through the issuance of the 5.250% Senior Notes due 2031 and the 5.500% Senior Notes due 2034 as described below. The Company recognized a non-cash loss of $10.0 million from the redemption of the 2028 Notes resulting from the write-off of unamortized debt issuance costs and debt discount, which is recorded as a component of Interest expense, net in the unaudited Condensed Consolidated Statement of Income and Comprehensive Income for the nine months ended September 30, 2026.

5.250% Senior Notes due 2031

5.500% Senior Notes due 2034

On February 27, 2026, Wesco Distribution issued $650 million aggregate principal amount of 5.250% Senior Notes due 2031 (the “2031 Notes”) and $850 million aggregate principal amount of 5.500% Senior Notes due 2034 (the “2034 Notes” and, together with the 2031 Notes, the “2031 and 2034 Notes”). The 2031 and 2034 Notes were issued at prices of 100% of the aggregate principal amounts thereof. Wesco incurred costs related to the issuance of the 2031 and 2034 Notes totaling $8.3 million and $10.8 million, respectively, which were recorded as a reduction to the carrying value of the debt and are being amortized over the respective terms of the notes.

The 2031 and 2034 Notes were issued pursuant to, and are governed by, an indenture (the “2031 and 2034 Notes Indenture”), dated as of February 27, 2026, among Wesco Distribution, the Company, Anixter Inc., and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”). The 2031 and 2034 Notes and related guarantees were issued in a private transaction exempt from the Securities Act of 1933, as amended (the “Securities Act”), and have not been, and will not be, registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and other applicable securities laws.

The Company used the net proceeds from the issuance of the 2031 and 2034 Notes to redeem the 2028 Notes on June 15, 2026 and to repay a portion of the amounts outstanding under the Revolving Credit Facility. Prior to redeeming the 2028 Notes, the Company used the net proceeds to temporarily repay a portion of the outstanding borrowings under the Receivables Facility and Revolving Credit Facility. The Company subsequently redrew under the Receivables Facility and the Revolving Credit Facility in an aggregate amount sufficient to redeem the 2028 Notes.

The 2031 and 2034 Notes are unsecured and unsubordinated obligations of Wesco Distribution and are guaranteed on an unsecured, unsubordinated basis by the Company and Anixter Inc. The 2031 Notes accrue interest at a rate of 5.250% per annum, payable semi-annually in arrears on April 15 and October 15 of each year. The 2031 Notes will mature on April 15, 2031. The 2034 Notes accrue interest at a rate of 5.500% per annum, payable semi-annually in arrears on April 15 and October 15 of each year. The 2034 Notes will mature on April 15, 2034.

Wesco Distribution may redeem all or a part of the 2031 Notes at any time prior to April 15, 2028 by paying a “make-whole” premium plus accrued and unpaid interest, if any, to but excluding the redemption date. In addition, any time prior to April 15, 2028, Wesco Distribution may redeem up to 35% of the original aggregate principal amount of the 2031 Notes with the net cash proceeds from certain equity offerings. At any time between April 15, 2028 and April 14, 2029, Wesco Distribution may redeem all or a part of the 2031 Notes at a redemption price equal to 102.625% of the principal amount. Between April 15, 2029 and April 14, 2030, Wesco Distribution may redeem all or a part of the 2031 Notes at a redemption price equal to 101.3125% of the principal amount. On and after April 15, 2030, Wesco Distribution may redeem all or a part of the 2031 Notes at a redemption price equal to 100% of the principal amount.

Wesco Distribution may redeem all or a part of the 2034 Notes at any time prior to April 15, 2029 by paying a “make-whole” premium plus accrued and unpaid interest, if any, to but excluding the redemption date. In addition, any time prior to April 15, 2029, Wesco Distribution may redeem up to 35% of the original aggregate principal amount of the 2034 Notes with the net cash proceeds from certain equity offerings. At any time between April 15, 2029 and April 14, 2030, Wesco Distribution may redeem all or a part of the 2034 Notes at a redemption price equal to 102.750% of the principal amount. Between April 15, 2030 and April 14, 2031, Wesco Distribution may redeem all or a part of the 2034 Notes at a redemption price equal to 101.375% of the principal amount. On and after April 15, 2031, Wesco Distribution may redeem all or a part of the 2034 Notes at a redemption price equal to 100% of the principal amount.

The 2031 and 2034 Notes Indenture contains certain covenants that, among other things, limit the Company’s and its restricted subsidiaries’ ability to incur liens on assets, make certain restricted payments, engage in certain sale and leaseback transactions or sell certain assets or merge or consolidate with or into other companies, subject to certain qualifications and exceptions, including the termination of certain of these covenants upon the 2031 and 2034 Notes receiving investment grade credit ratings.

The 2031 and 2034 Notes Indenture contains certain events of default, including, among other things, failure to make required payments, failure to comply with certain agreements or covenants, failure to pay or acceleration of certain other indebtedness, certain events of bankruptcy and insolvency, and failure to pay certain judgments. An event of default under the 2031 and 2034 Notes Indenture will allow either the Trustee or the holders of at least 25% in aggregate principal amount of the applicable series of the then-outstanding Notes to accelerate or, in certain cases, will automatically cause the acceleration of the amounts due under the applicable series of Notes.

10. FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company’s financial instruments primarily consist of cash and cash equivalents, accounts receivable, accounts payable, bank overdrafts, outstanding indebtedness, foreign currency forward contracts, and benefit plan assets. Except for benefit plan assets, outstanding indebtedness and foreign currency forward contracts, the carrying value of the Company’s other financial instruments approximates fair value.

The assets of the Company’s various defined benefit plans primarily comprise common/collective/pool funds (i.e., mutual funds). These funds are valued at the net asset value (“NAV”) of shares held in the underlying funds. Investments for which fair value is measured using the NAV per share practical expedient are not classified in the fair value hierarchy.

The Company uses a market approach to determine the fair value of its debt instruments, utilizing quoted prices in active markets, interest rates and other relevant information generated by market transactions involving similar instruments. Therefore, the inputs used to measure the fair value of the Company’s debt instruments are classified as Level 2 within the fair value hierarchy.

The carrying value of the Company’s debt instruments with fixed interest rates was $4,050.0 million and $3,871.9 million as of September 30, 2026 and December 31, 2025, respectively. The estimated fair value of this debt was $3,940.6 million and $4,004.2 million as of September 30, 2026 and December 31, 2025, respectively. The reported carrying values of the Company’s other debt instruments, including those with variable interest rates, approximated their fair values as of September 30, 2026 and December 31, 2025.

The Company purchases foreign currency forward contracts to reduce the effect of fluctuations in foreign currency-denominated accounts on its earnings. The foreign currency forward contracts are not designated as hedges for accounting purposes. The Company’s strategy is to negotiate terms for its derivatives and other financial instruments to be highly effective, such that the change in the value of the derivative offsets the impact of the underlying hedge. Its counterparties to foreign currency forward contracts have investment-grade credit ratings. The Company regularly monitors the creditworthiness of its counterparties as a risk mitigation effort to protect the value of its derivatives.

The Company does not hedge 100% of its foreign currency-denominated accounts. In addition, the results of hedging can vary significantly based on various factors, such as the timing of executing foreign currency forward contracts versus the movement of currencies, as well as fluctuations in the account balances throughout each reporting period. The fair value of foreign currency forward contracts is based on the difference between the contract rate and the current price of a forward contract with an equivalent remaining term. The fair value of foreign currency forward contracts is measured using observable market information. These inputs are considered Level 2 in the fair value hierarchy. At September 30, 2026 and December 31, 2025, foreign currency forward contracts were revalued at then-current foreign exchange rates with the changes in valuation reflected directly in Other non-operating (income) expense in the unaudited Condensed Consolidated Statements of Income and Comprehensive Income offsetting the transaction gain (loss) recorded on foreign currency-denominated accounts. The gross and net notional amounts of foreign currency forward contracts outstanding were approximately $315.6 million and $286.3 million, at September 30, 2026 and December 31, 2025, respectively. While all of the Company’s foreign currency forward contracts are subject to master netting arrangements with its counterparties, assets and liabilities related to these contracts are presented on a gross basis within the unaudited Condensed Consolidated Balance Sheets. The gross fair value of assets and liabilities related to foreign currency forward contracts were immaterial.

11. COMMITMENTS AND CONTINGENCIES

From time to time, a number of lawsuits and claims have been or may be asserted against the Company relating to the conduct of its business, including litigation relating to commercial, product and employment matters. The outcome of any litigation cannot be predicted with certainty, and some lawsuits may result in a negative impact to Wesco. However, management does not believe that the ultimate outcome of any such pending matters is likely to have a material adverse effect on Wesco’s financial condition or liquidity, although the resolution in any fiscal period of one or more of these matters may have a material adverse effect on Wesco’s results of operations for that period. Recoveries related to previously recognized losses are recorded when realization is probable. Recoveries in excess of recognized losses are deferred until realized or realizable.

During the third quarter of 2026, the previously disclosed loss contingency was resolved and payments were made directly from the Company's insurance carrier to the plaintiffs. As a result of the payment, the Company reversed the previously recorded loss contingency of $49.0 million in Other current liabilities, along with the corresponding insurance recovery receivable of $48.5 million in Other accounts receivable in the unaudited Condensed Consolidated Balance Sheet. The Company did not incur a loss other than for the insurance deductible amount, which is not material to the unaudited Condensed Consolidated Financial Statements.

On February 20, 2026, the U.S. Supreme Court ruled that tariffs previously imposed under the International Emergency Economic Powers Act (“IEEPA”) were invalid. The availability, timing, amount, and process for recovering IEEPA tariffs previously paid by the Company remains subject to further developments. IEEPA tariff refunds are not expected to materially impact the unaudited Condensed Consolidated Financial Statements for the Company. The Company continues to monitor developments and evaluate potential impacts on its financial condition and results of operations.

12. INCOME TAXES

The effective tax rate for the three months ended September 30, 2026 and 2025 was 24.4% and 23.5%, respectively. For the three months ended September 30, 2026, the effective tax rate reflects discrete income tax benefits of $0.5 million resulting from the exercise of stock-based awards and $9.1 million relating to return-to-provision adjustments related to the filing of the 2025 U.S. federal income tax return. The return-to-provision adjustments were primarily related to the impact of certain elections made on the 2025 U.S. federal income tax return under the One Big Beautiful Bill Act based on IRS guidance issued in 2026 with retroactive application to 2025. For the three months ended September 30, 2025, the effective tax rate reflects net discrete income tax benefits of $7.8 million primarily resulting from the exercise of stock-based awards. These discrete income tax benefits reduced the effective tax rates in the respective periods by approximately 2.7 and 3.2 percentage points.

The effective tax rate for the nine months ended September 30, 2026 and 2025 was 23.3% and 24.4%, respectively. For the nine months ended September 30, 2026, the effective tax rate reflects discrete income tax benefits of $22.9 million resulting from the exercise and vesting of stock-based awards and $9.1 million relating to return-to-provision adjustments that resulted from the filing of the 2025 U.S. federal income tax return as explained above. For the nine months ended September 30, 2025, the effective tax rate reflects net discrete income tax benefits of $12.8 million primarily resulting from the exercise and vesting of stock-based awards. These discrete income tax benefits reduced the effective tax rates in the respective periods by approximately 3.9 and 2.0 percentage points.

During the nine months ended September 30, 2026 and 2025, the Company purchased $56.4 million and $93.8 million, respectively, of transferable clean energy tax credits to reduce its U.S. federal income tax liability. The Company has taken appropriate measures to mitigate the transferee liability associated with these tax credits, including, but not limited to, conducting due diligence to confirm the eligibility of the underlying projects or production, as applicable, for the tax credits and the eligibility of the tax credits for transfer, obtaining appropriate contractual protections from the sellers, and obtaining tax credit insurance and/or seller guarantees.

The effective tax rate, excluding discrete income tax benefits, differs from the federal statutory income tax rate due primarily to state income taxes, nondeductible expenses, and the tax impact of international operations.

There have been no material adjustments to the Company's assessment of uncertain tax positions since December 31, 2025.

In October 2021, one of the Company’s Mexican affiliates received a tax assessment from the Mexican tax authorities related to its 2012 income tax return which was approximately $33.4 million as of December 31, 2025. The Company believed the assessment was without merit and the Company's Mexican affiliate filed an annulment lawsuit in the Mexican Federal Court of Administrative Justice (the “Court”). The Company expected to prevail in this litigation and, accordingly, did not recognize a liability for this assessment in its Consolidated Financial Statements. On April 23, 2026, the Company received the written decision of the Court, which was a split finding, mostly in favor of the government. Both parties filed appeals with the Mexican

Federal Collegiate Circuit Court. The Company maintains that it ultimately expects to prevail upon final resolution of the matter.

13. BUSINESS SEGMENTS

The Company has operating segments comprising three strategic business units: EES, CSS and UBS. These operating segments are equivalent to the Company’s reportable segments. The President and Chief Executive Officer serves as the Company’s Chief Operating Decision Maker (“CODM”). The CODM evaluates the performance of the Company’s reportable segments based on Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”), which is the Company’s measure of segment profit or loss.

The Company incurs corporate costs primarily related to treasury, tax, information technology, finance, legal and other centralized functions. The Company also has various corporate assets. Segment assets may not include jointly used assets, but segment results include allocations related to those assets. Interest expense and other non-operating items are either not allocated to the segments or reviewed on a segment basis. Corporate expenses and assets not directly identifiable with a reportable segment are reported in the tables below to reconcile the reportable segments to the Consolidated Financial Statements.

The following tables present information about the Company’s reportable segments and reconcile Adjusted EBITDA by segment to Income before income taxes on a consolidated basis for the periods presented:

The following table sets forth Other (income) expense, net by reportable segment for the periods presented, which primarily consists of net foreign currency (gains) losses:

The following table sets forth capital expenditures by reportable segment for the periods presented:

The following table sets forth Total assets by reportable segment for the periods presented:

(1)Total assets for Corporate primarily consist of cash and cash equivalents, income taxes receivable, deferred income taxes, property, buildings and equipment, and capitalized cloud computing arrangement costs.