MKS INC

Previous wording

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 regarding the future financial performance, business prospects and growth of MKS Inc., formerly known as MKS Instruments, Inc. (“MKS,” the “Company,” “our,” or “we”). These statements are only predictions based on current assumptions and expectations. Any statements that are not statements of historical fact (including statements containing the words “will,” “projects,” “intends,” “believes,” “plans,” “anticipates,” “expects,” “estimates,” “forecasts,” “continues” and similar expressions) should be considered forward-looking statements. Actual events or results may differ materially from those in the forward-looking statements set forth herein.

Current wording

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 regarding the future financial performance, business prospects and growth of MKS Inc. (“MKS,” the “Company,” “our,” or “we”). These statements are only predictions based on current assumptions and expectations. Any statements that are not statements of historical fact (including statements containing the words “will,” “projects,” “intends,” “believes,” “plans,” “anticipates,” “expects,” “estimates,” “forecasts,” “continues” and similar expressions) should be considered forward-looking statements. Actual events or results may differ materially from those in the forward-looking statements set forth herein.

Previous wording

Among the important factors that could cause actual events to differ materially from those in the forward-looking statements that we make are the level and terms of our substantial indebtedness and our ability to service such debt; our entry into the chemicals technology business through our acquisition of Atotech Limited (“Atotech”) in August 2022 (the “Atotech Acquisition”) which has exposed us to significant additional liabilities; the risk that we are unable to realize the anticipated benefits of the Atotech Acquisition; risks related to cybersecurity, data privacy and intellectual property; competition from larger, more advanced or more established companies in our markets; the ability to successfully grow our business, including through growth of the Atotech business and financial risks associated with that acquisition and potential future acquisitions, including goodwill and intangible asset impairments; manufacturing and sourcing risks, including those associated with limited and sole source suppliers and the impact and duration of supply chain disruptions, component shortages, and price increases; changes in global demand; risks associated with doing business internationally, including geopolitical conflicts, such as the conflict in the Middle East, trade compliance, trade protection measures, such as import tariffs by the United States or retaliatory actions taken by other countries, regulatory restrictions on our products, components or markets, particularly the semiconductor market, and unfavorable currency exchange and tax rate fluctuations, which risks become more significant as we grow our business internationally and in China specifically; conditions affecting the markets in which we operate, including fluctuations in capital spending in the semiconductor, electronics manufacturing and automotive industries, and fluctuations in sales to our major customers; disruptions or delays from third-party service providers upon which our operations may rely; the ability to anticipate and meet customer demand; the challenges, risks and costs involved with integrating or transitioning global operations of the companies we have acquired; risks associated with the attraction and retention of key personnel; potential fluctuations in quarterly results; dependence on new product development; rapid technological and market change; acquisition strategy; volatility of stock price; risks associated with chemical manufacturing and environmental regulation compliance; risks related to defective products; financial and legal risk management; and the other important factors described under the heading “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the U.S. Securities and Exchange Commission on February 25, 2025 (“Annual Report”), Part II, Item 1A of our Quarterly Report on Form 10-Q for the three months ended March 31, 2025 and any subsequent Quarterly Reports on Form 10-Q. We are under …

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Current wording

Among the important factors that could cause actual events to differ materially from those in the forward-looking statements that we make are the level and terms of our substantial indebtedness and our ability to service such debt; risks related to pursuing, completing, and/or failing to realize the benefits of acquisitions and other strategic transactions critical to our growth strategy; risks related to cybersecurity, data privacy and intellectual property; manufacturing and sourcing risks, including supply chain disruptions, component shortages and price increases, the use of limited, sole source and international suppliers, the relocation of manufacturing operations, and product defects; risks associated with doing business internationally, including geopolitical conflicts, trade compliance, trade protection measures, such as import tariffs by the United States and/or retaliatory actions taken by other countries, regulatory restrictions on our products, components or markets, particularly the semiconductor market, and unfavorable currency exchange and tax rate fluctuations; conditions affecting the markets in which we operate, including intense competition, rapid technological and market changes, dependence on new product development, the ability to anticipate and meet customer demand, fluctuations in capital spending in the semiconductor, electronics manufacturing and automotive industries, and fluctuations in sales to our major customers; disruptions or delays from third-party service providers upon which our operations may rely; risks associated with the attraction and retention of key personnel; potential fluctuations in quarterly results; volatility of stock price; risks associated with chemical manufacturing and environmental regulation compliance; risks associated with artificial intelligence (“AI”); financial and legal risk management; and the other important factors described under the heading “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the U.S. Securities and Exchange Commission on February 24, 2026 (“Annual Report”) and any subsequent Quarterly Reports on Form 10-Q. We are under no obligation to, and expressly disclaim any obligation to, update or alter these forward-looking statements, whether as a result of new information, future events or otherwise, even if subsequent events cause our views to change.

Previous wording

The Management’s Discussion and Analysis of Financial Condition and Results of Operations describes principal factors affecting the results of operations, financial condition, cash flows and liquidity, as well as our critical accounting policies and estimates that require significant judgment and thus have the most significant potential impact on our condensed consolidated financial statements, and is intended to better allow investors to view the Company from management’s perspective. This section focuses on material events and uncertainties known to management that are reasonably likely to cause reported financial information not to be necessarily indicative of our future operating results or of our future financial condition. This section provides an analysis of our financial results for the three months ended September 30, 2025 compared to the three months ended June 30, 2025, and the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. As a result of rounding, there may be immaterial differences in amounts presented and certain calculations may not sum to the total number expressed in each category or tie to a corresponding schedule.

Current wording

The Management’s Discussion and Analysis of Financial Condition and Results of Operations describes principal factors affecting the results of operations, financial condition, cash flows and liquidity, as well as our critical accounting policies and estimates that require significant judgment and thus have the most significant potential impact on our condensed consolidated financial statements, and is intended to better allow investors to view the Company from management’s perspective. This section focuses on material events and uncertainties known to management that are reasonably likely to cause reported financial information not to be necessarily indicative of our future operating results or of our future financial condition. This section provides an analysis of our financial results for the three months ended March 31, 2026 compared to the three months ended December 31, 2025 and the three months ended March 31, 2025. As a result of rounding, there may be immaterial differences in amounts presented and certain calculations may not sum to the total number expressed in each category or tie to a corresponding schedule.

Previous wording

We enable technologies that transform our world. We deliver foundational technology solutions to leading edge semiconductor manufacturing, electronics and packaging, and specialty industrial applications. We apply our broad science and engineering capabilities to create instruments, subsystems, systems, process control solutions and specialty chemicals technology that improve process performance, optimize productivity and enable unique innovations for many of the world’s leading technology and industrial companies. Our solutions are critical to addressing the challenges of miniaturization and complexity in advanced device manufacturing by enabling increased power, speed, feature enhancement and optimized connectivity. Our solutions are also critical to addressing ever-increasing performance requirements across a wide array of specialty industrial applications.

Current wording

MKS was founded in 1961 as a Massachusetts corporation. We enable technologies that transform our world. We deliver foundational technology solutions to leading edge semiconductor manufacturing, electronics and packaging, and specialty industrial applications. We apply our broad science and engineering capabilities to create instruments, subsystems, systems, process control solutions and specialty chemicals technology that improve process performance, optimize productivity and enable unique innovations for many of the world’s leading technology and industrial companies. Our solutions are critical to addressing the challenges of miniaturization and complexity in advanced device manufacturing by enabling increased power, speed, feature enhancement and optimized connectivity. Our solutions are also critical to addressing ever-increasing performance requirements across a wide array of specialty industrial applications.

Previous wording

We are a critical solutions provider for semiconductor manufacturing. Our products are used in major semiconductor processing steps, such as deposition, etching, cleaning, lithography, metrology, and inspection. The semiconductor industry continually faces new challenges, as products become smaller, more powerful and highly mobile. Ultra-thin layers, smaller critical dimensions, new materials, 3D structures, and the ongoing need for higher yield and productivity drive the need for tighter process measurement and control, all of which we support. We believe we are the broadest critical subsystem provider in the wafer fabrication equipment ecosystem and address over 85% of the market. We characterize our broad and unique offering as Surround the Wafer® to reflect the technology enablement we provide across almost every major process in semiconductor manufacturing today.

Current wording

We are a critical solutions provider for semiconductor manufacturing. Our products are used in major semiconductor processing steps, such as deposition, etching, cleaning, lithography, metrology, and inspection. The semiconductor industry continually faces new challenges, as products become smaller, more powerful and highly mobile. Ultra-thin layers, smaller critical dimensions, new materials, 3D structures, and the ongoing need for higher yield and productivity drive the need for tighter process measurement and control, all of which we support. We believe we are the broadest critical subsystem provider in the wafer fabrication equipment (“WFE”) ecosystem and address over 85% of the market. We characterize our broad and unique offering as Surround the Wafer® to reflect the technology enablement we provide across almost every major process in semiconductor manufacturing today.

Previous wording

The semiconductor market is subject to rapid demand shifts, which are difficult to predict, and we cannot be certain as to the timing or extent of future demand or any future softening in the semiconductor capital equipment industry. In addition to these rapid demand shifts, the semiconductor capital equipment industry has recently been subject to significant trade restrictions, especially in key markets, including China.

Current wording

The semiconductor market is subject to rapid demand shifts, which are difficult to predict, and we cannot be certain as to the timing or extent of future demand or any future softening in the semiconductor capital equipment industry. We are currently in a semiconductor ramp as demand for semiconductor chips is growing in the near term as a result of increased investments in AI transformation-related applications. In addition to these rapid demand shifts, the semiconductor capital equipment industry is currently subject to significant trade restrictions, especially in key markets, including China.

Previous wording

For the three months ended September 30, 2025, net revenues in our semiconductor market decreased by $17 million, or 4%, compared to the prior quarter due to lower sales of our semiconductor capital equipment at VSD primarily driven by reduced demand due to the timing of NAND upgrades.

Current wording

For the three months ended March 31, 2026, net revenues in our semiconductor market increased by $31 million, or 7%, compared to the prior quarter due to higher sales of our semiconductor capital equipment at VSD serving deposition and etch applications as well as NAND memory production upgrades.

Previous wording

For the nine months ended September 30, 2025, net revenues in our semiconductor market increased by $163 million, or 15%, compared to the same period in the prior year. The increase was mainly due to higher sales of our semiconductor capital equipment in logic and foundry applications at VSD, higher NAND memory production upgrades at VSD and higher service revenues, partially offset by decreases in sales in our lithography, metrology and inspection products at PSD.

Current wording

For the three months ended March 31, 2026, net revenues in our semiconductor market increased by $53 million, or 13%, compared to the same period in the prior year. This increase was mainly due to higher sales of our semiconductor capital equipment serving deposition and etch applications and service revenues at VSD, as well as higher sales in our lithography, metrology and inspection products at PSD.

Previous wording

We are a foundational solutions provider for the electronics and packaging market. Our portfolio includes photonics components, laser drilling systems, electronics chemistries and plating equipment that are critical for the manufacturing of PCBs and package substrates, and critical to wafer level packaging (“WLP”) applications. Similar to the semiconductor industry, the PCB, package substrate and WLP industries demand smaller features, greater density, and better performance. In addition, the electronics and packaging market also includes sales of our vacuum and photonics solutions for display manufacturing applications. We characterize our complementary offering of laser systems and chemistry solutions as Optimize the Interconnect®, to reflect the unique technology enablement we provide at the Interconnect level within PCBs, package substrates and WLPs.

Current wording

We are a foundational solutions provider for the electronics and packaging market. Our portfolio includes photonics components, laser drilling systems, electronics chemistries and plating equipment that are critical for the manufacturing of printed circuit boards (“PCB”) and package substrates, and critical to wafer level packaging (“WLP”) applications. Similar to the semiconductor industry, the PCB, package substrate and WLP industries demand smaller features, greater density, and better performance. In addition, the electronics and packaging market also includes sales of our vacuum and photonics solutions for display manufacturing applications. We characterize our complementary offering of laser systems and chemistry solutions as Optimize the Interconnect®, to reflect the unique technology enablement we provide at the Interconnect level within PCBs, package substrates and WLPs.

Previous wording

For the three months ended September 30, 2025, net product revenues increased $12 million compared to the prior quarter primarily due to higher chemistry and equipment sales in the electronics and packaging and specialty industrial markets at MSD, partially offset by lower NAND upgrade sales in the semiconductor market at VSD.

Current wording

For the three months ended March 31, 2026, net revenues in our electronics and packaging market increased by $18 million, or 6%, compared to the prior quarter primarily due to higher sales of flexible PCB via drilling systems at PSD and chemistry at MSD, partially offset by lower sales of chemistry equipment at MSD.

Previous wording

For the nine months ended September 30, 2025, net revenues in our electronics and packaging market increased by $140 million, or 21%, compared to the same period in the prior year. This increase was primarily due to higher chemistry and equipment sales in the electronics market at MSD as well as higher sales of PCB via drilling systems at PSD.

Current wording

For the three months ended March 31, 2026, net revenues in our electronics and packaging market increased by $68 million, or 27%, compared to the same period in the prior year. This increase was primarily due to higher chemistry sales at MSD as well as higher sales of flexible PCB via drilling systems at PSD.

Previous wording

A significant portion of our net revenues is from sales to customers in international markets. For the nine months ended September 30, 2025 and 2024, international net revenues accounted for approximately 81% and 77% respectively, of our total net revenues. A significant portion of our international net revenues was from customers in China, South Korea, Singapore, Taiwan and Japan. We expect international net revenues will continue to account for a significant percentage of total net revenues for the foreseeable future.

Current wording

A significant portion of our net revenues is from sales to customers in international markets. For the three months ended March 31, 2026 and 2025, international net revenues accounted for approximately 82% and 81% respectively, of our total net revenues. We report geographical net revenues based on the shipped-to location of the end customer. A significant portion of our international net revenues was from customers in China, South Korea, Singapore, Malaysia, Japan and Taiwan. We expect international net revenues will continue to account for a significant percentage of total net revenues for the foreseeable future.

Previous wording

Long-lived assets located outside of the United States accounted for approximately 68% and 59% of our total long-lived assets as of September 30, 2025 and December 31, 2024, respectively. Long-lived assets include property, plant and equipment, net, right-of-use assets and certain other assets.

Current wording

Long-lived assets located outside of the United States accounted for approximately 70% of our total long-lived assets as of both March 31, 2026 and December 31, 2025. Long-lived assets include property, plant and equipment, net, right-of-use assets and certain other assets.

Previous wording

Net service revenues consisted mainly of fees for services related to the maintenance and repair of our products, sales of spare parts, and installation and training. For the three months ended September 30, 2025, net service revenues increased $3 million compared to the prior quarter mainly as a result of higher demand in our semiconductor market at PSD and electronics and packaging market at MSD.

Current wording

Net service revenues consisted mainly of fees for services related to the maintenance and repair of our products, sales of spare parts, and installation and training. For the three months ended March 31, 2026, net service revenues decreased $2 million compared to the prior quarter mainly as a result of lower repair demand in our semiconductor and specialty industrial markets at VSD.

Previous wording

For the nine months ended September 30, 2025, net service revenues increased $19 million compared to the same period in the prior year, primarily due to higher demand in our semiconductor market at VSD, partially offset by lower demand in our electronics and packaging market at PSD and MSD.

Current wording

For the three months ended March 31, 2026, net service revenues increased $7 million compared to the same period in the prior year, primarily due to higher repair demand in our semiconductor market at VSD.

Previous wording

For the three months ended September 30, 2025, net revenues from VSD decreased $21 million compared to the prior quarter mainly due to decreased sales in semiconductor capital equipment driven by reduced demand due to the timing of NAND upgrades. For the nine months ended September 30, 2025, net revenues from VSD increased $167 million compared to the same period in the prior year, mainly due to higher sales of our semiconductor capital equipment in logic and foundry applications, higher NAND memory production upgrades and higher service revenues. This was partially offset by decreases in industrial applications in our specialty industrial market.

Current wording

For the three months ended March 31, 2026, net revenues from VSD increased $25 million compared to the prior quarter mainly due to increased sales in semiconductor capital equipment serving deposition and etch applications as well as NAND memory production upgrades. For the three months ended March 31, 2026, net revenues from VSD increased $39 million compared to the same period in the prior year, mainly due to higher sales of our semiconductor capital equipment serving deposition and etch applications and higher service revenues.

Previous wording

For the three months ended September 30, 2025, net revenues from PSD increased $6 million compared to the prior quarter mainly due to higher sales of PCB via drilling systems in our electronics and packaging market. For the nine months ended September 30, 2025, net revenues from PSD decreased $3 million compared to the same period in the prior year, mainly due to lower sales of our lithography, metrology and inspection products in our semiconductor market as well as decreases in sales in life and health sciences and industrial applications in our specialty industrial market, partially offset by higher sales of PCB via drilling systems in our electronics and packaging market.

Current wording

For the three months ended March 31, 2026, net revenues from PSD increased $29 million compared to the prior quarter mainly due to higher sales of flexible PCB via drilling systems in our electronics and packaging market and higher sales in datacom applications within our specialty industrial market. For the three months ended March 31, 2026, net revenues from PSD increased $40 million compared to the same period in the prior year, mainly due to higher sales in datacom applications in our specialty industrial market, higher sales of flexible PCB via drilling systems in our electronics and packaging market as well as higher sales of our lithography, metrology and inspection products in our semiconductor market.

Previous wording

For the three months ended September 30, 2025, net revenues from MSD increased $30 million compared to the prior quarter mainly due to increased chemistry and equipment sales in our electronics and packaging market. For the nine months ended September 30, 2025, revenues from MSD increased $82 million compared to the same period in the prior year, mainly due to higher chemistry and equipment sales in our electronics and packaging market partially offset by lower sales in our industrial market.

Current wording

For the three months ended March 31, 2026, net revenues from MSD decreased $9 million compared to the prior quarter mainly due to a decrease in electronic equipment sales and lower sales for industrial applications, partially offset by increased chemistry sales in our electronics and packaging market. For the three months ended March 31, 2026, revenues from MSD increased $63 million compared to the same period in the prior year, mainly due to higher electronic chemistry sales in our electronics and packaging market as well as higher sales for industrial applications.

Previous wording

Gross profit as a percentage of net product revenues decreased by 1.1 percentage points for the nine months ended September 30, 2025 compared to the same period in the prior year, primarily due to higher duty and tariff costs and unfavorable product mix, partially offset by higher revenue volumes.

Current wording

Gross profit as a percentage of net product revenues decreased by 0.5 percentage points for the three months ended March 31, 2026 compared to the same period in the prior year, primarily due to unfavorable product mix and higher duty and tariff costs, partially offset by higher revenue volumes and lower excess and obsolete inventory charges.

Previous wording

Gross profit as a percentage of net services revenues decreased by 2.7 percentage points for the three months ended September 30, 2025 compared to the prior quarter, primarily due to higher other production costs and unfavorable mix on products repaired, partially offset by lower freight and duty costs.

Current wording

Gross profit as a percentage of net services revenues increased by 3.7 percentage points for the three months ended March 31, 2026 compared to the prior quarter, primarily due to favorable labor and overhead absorption and lower excess and obsolete inventory charges, partially offset by unfavorable product mix.

Previous wording

Gross profit as a percentage of net services revenues increased by 0.2 percentage points for the nine months ended September 30, 2025 compared to the same period in the prior year, primarily due to favorable product mix and lower scrap and rework charges offset by higher variable compensation and freight and duty costs.

Current wording

Gross profit as a percentage of net services revenues increased by 1.4 percentage points for the three months ended March 31, 2026 compared to the same period in the prior year, primarily due to favorable labor and overhead absorption and lower excess and obsolete inventory charges offset by unfavorable product mix.

Previous wording

Gross profit as a percentage of net revenues for MSD increased for the three months ended September 30, 2025 compared to the prior quarter, primarily due to higher revenue volumes and lower duty and tariff costs, partially offset by higher excess and obsolete inventory charges. Gross profit as a percentage of net revenues for MSD decreased for the nine months ended September 30, 2025 compared to the same period in the prior year, primarily due to unfavorable product mix and higher excess and obsolete inventory charges, partially offset by higher revenue volumes.

Current wording

Gross profit as a percentage of net revenues for VSD increased for the three months ended March 31, 2026 compared to the prior quarter, primarily due to higher revenue volumes and favorable factory utilization, partially offset by unfavorable product mix and higher excess and obsolete inventory charges. Gross profit as a percentage of net revenues for VSD decreased for the three months ended March 31, 2026 compared to the same period in the prior year, primarily due to unfavorable product mix and higher duty and tariff costs, partially offset by higher revenue volumes and favorable factory utilization as well as lower excess and obsolete inventory charges.

Previous wording

Gross profit as a percentage of net revenues for PSD increased for the three months ended September 30, 2025 compared to the prior quarter, primarily due to favorable product mix and factory utilization as well as lower material costs. Gross profit as a percentage of net revenues for PSD decreased for the nine months ended September 30, 2025 compared to the same period in the prior year, primarily due to higher duty and tariff costs and variable compensation, partially offset by lower excess and obsolete inventory charges.

Current wording

Gross profit as a percentage of net revenues for PSD increased for the three months ended March 31, 2026 compared to the prior quarter, primarily due to higher revenue volumes and favorable factory utilization. Gross profit as a percentage of net revenues for PSD increased for the three months ended March 31, 2026 compared to the same period in the prior year, primarily due to higher revenue volumes, favorable factory utilization and lower excess and obsolete inventory charges, partially offset by higher duty and tariff costs.

Previous wording

Research and development expenses for the three months ended September 30, 2025 remained flat compared to the prior quarter. Research and development expenses increased $16 million for the nine months ended September 30, 2025 compared to the same period in the prior year, primarily due to an increase of $15 million in compensation-related costs, mainly related to variable incentive compensation.

Current wording

Research and development expenses for the three months ended March 31, 2026 increased $3 million compared to the prior quarter primarily due to $2 million in compensation-related costs. Research and development expenses increased $11 million for the three months ended March 31, 2026 compared to the same period in the prior year primarily due to $4 million in compensation-related costs, $3 million in project material costs and $2 million in software maintenance costs.

Previous wording

We continue to make product advancements designed to meet our customers’ evolving needs. We have developed, and continue to develop, new products designed to address industry trends, such as the rising demand for more complex hardware architecture related to increasing investments in artificial intelligence, the shrinking of integrated circuit critical dimensions and technology inflections, and, in the flat panel display and solar markets, the transition to larger substrate sizes, which require more advanced processing and process control technology, the continuing drive towards more complex and accurate components and devices within the handset and tablet market, the growth in units and via counts in the high density interconnect PCB drilling market, and the transition from internal combustion to electric vehicles. In addition, we have developed, and continue to develop, products that support the migration to new classes of materials, ultra-thin layers, and 3D structures that are used in small geometry manufacturing. In our chemistry and equipment plating businesses, a majority of our research and development investment supports existing customers’ product improvement needs and their short-term research and development goals, which enables us to pioneer new high-value solutions while limiting commercial risk. Research and development expenses consist primarily of salaries and related expenses for personnel engaged in research and development, fees paid to consultants, material costs for prototypes and other expenses related to the design, development, testing and enhancement of our products.

Current wording

We continue to make product advancements designed to meet our customers’ evolving needs. We have developed, and continue to develop, new products designed to address industry trends, such as the rising demand for more complex hardware architecture related to increasing investments in artificial intelligence, the shrinking of integrated circuit critical dimensions and technology inflections, and, in the flat panel display and solar markets, the transition to larger substrate sizes, which require more advanced processing and process control technology, the continuing drive toward more complex and accurate components and devices within the handset and tablet market, the growth in units and via counts in the high density interconnect PCB drilling market, and the transition from internal combustion to electric vehicles. In addition, we have developed, and continue to develop, products that support the migration to new classes of materials, ultra-thin layers, and 3D structures that are used in small geometry manufacturing. In our chemistry and equipment plating businesses, a majority of our research and development investment supports existing customers’ product improvement needs and their short-term research and development goals, which enables us to pioneer new high-value solutions while limiting commercial risk. Research and development expenses consist primarily of salaries and related expenses for personnel engaged in research and development, fees paid to consultants, material costs for prototypes and other expenses related to the design, development, testing and enhancement of our products.

Previous wording

Selling, general and administrative expenses increased $5 million for the three months ended September 30, 2025 compared to the prior quarter, primarily due to an increase of $3 million in compensation-related costs, mainly related to variable compensation.

Current wording

Selling, general and administrative expenses increased $5 million for the three months ended March 31, 2026 compared to the prior quarter, primarily due to an increase of $11 million, mainly related to stock compensation, partially offset by decreases of $3 million in consulting fees and $2 million in legal costs.

Previous wording

Selling, general and administrative expenses increased $41 million for the nine months ended September 30, 2025 compared to the same period in the prior year, primarily due to an increase of $46 million in compensation-related costs, mainly related to stock-based and other variable incentive compensation, partially offset by lower costs due to a decrease in headcount, resulting from the global cost saving initiative implemented during the first quarter of 2025.

Current wording

Selling, general and administrative expenses increased $5 million for the three months ended March 31, 2026 compared to the same period in the prior year, primarily due to an increase of $5 million in variable incentive compensation, partially offset by lower headcount costs resulting from the global cost saving initiative implemented during the first quarter of 2025.

Previous wording

Restructuring and other charges during the three and nine months ended September 30, 2025 and the three months ended June 30, 2025 related primarily to severance costs incurred as a result of a global cost saving initiative implemented during the first quarter of 2025, mainly in the general metals finishing business within MSD as well as third party costs supporting other strategic initiatives. Restructuring and other charges during the nine months ended September 30, 2024, primarily related to severance costs incurred as a result of a global cost saving initiative implemented in the fourth quarter of 2023.

Current wording

Restructuring and other charges during the three months ended March 31, 2026 related primarily to severance costs incurred as a result of a reorganization of certain business units within PSD implemented during the first quarter of 2026. Restructuring and other charges during the three months ended December 31, 2025 related primarily to third party costs supporting certain strategic initiatives. Restructuring and other charges during the three months ended March 31, 2025 related to severance costs incurred as a result of a cost saving initiative implemented in the first quarter of 2025, primarily in the general metal finishing business within MSD.

Previous wording

During the nine months ended September 30, 2025, we recorded fees and expenses related to the Fifth Amendment to Credit Agreement, dated as of January 24, 2025, by and among us as parent borrower, the other loan parties party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and each lender party thereto (the “Fifth Amendment”). During the nine months ended September 30, 2024, we recorded fees and expenses related to the Fourth Amendment to Credit Agreement, dated as of July 23, 2024, by and among us as parent borrower, the other loan parties party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and each lender party thereto (the “Fourth Amendment”) and the Second Amendment to Credit Agreement, dated as of January 22, 2024, by and among us as parent borrower, the other loan parties party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and each lender party thereto (the “Second Amendment”).

Current wording

During the three months ended March 31, 2026, we recorded fees and expenses related to the Sixth Amendment to Credit Agreement, dated as of February 4, 2026, by and among us as parent borrower, the other loan parties party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and each lender party thereto (the “Sixth Amendment”) as well as a fee from a foreign exchange option contract related to the 2034 Notes (as defined below). During the three months ended March 31, 2025, we recorded fees and expenses related to the Fifth Amendment to Credit Agreement, dated as of January 24, 2025, by and among us as parent borrower, the other loan parties party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and each lender party thereto (the “Fifth Amendment”).

Previous wording

Amortization of intangible assets for the three months ended September 30, 2025 increased $1 million compared to the prior quarter. Amortization of intangible assets for the nine months ended September 30, 2025 remained flat compared to the same period in the prior year.

Current wording

Amortization of intangible assets for the three months ended March 31, 2026 increased $1 million compared to the prior quarter and $3 million compared to the same period in the prior year primarily due to the impact of foreign exchange rates on intangible assets at foreign locations.

Previous wording

Other expense (income), net for the three and nine months ended September 30, 2025, three months ended June 30, 2025 and nine months ended September 30, 2024 consisted primarily of net foreign exchange and fair value gains and losses.

Current wording

Other (income) expense, net for the three months ended March 31, 2026, three months ended December 31, 2025 and three months ended March 31, 2025 consisted primarily of net foreign exchange and fair value gains and losses.

Previous wording

Our effective tax rates for the nine months ended September 30, 2025 and 2024 were 12.7% and 1.2%, respectively. Our effective tax rate for the nine months ended September 30, 2025 was lower than the U.S. statutory tax rate mainly due to the U.S. deduction for FDII and research and development tax credits, partially offset by foreign withholding taxes and a waiver of deductions related to U.S. base erosion payments. Our effective tax rate for the nine months ended September 30, 2024 was lower than the U.S. statutory tax rate primarily due to a tax benefit related to the earnings mix, an increase in the U.S. deduction for FDII and a one-time increase in research and development tax credits due to the filing of prior year amended returns for years 2020 and 2021, partially offset by an expected increase in foreign withholding taxes and a waiver of deductions related to U.S. base erosion payments.

Current wording

Our effective tax rates for the three months ended March 31, 2026, three months ended December 31, 2025, and three months ended March 31, 2025 were 17.7%, (20.8%), and 12.3%, respectively. Our effective tax rates for the three months ended March 31, 2026 and March 31, 2025 were lower than the U.S. statutory tax rate, mainly due to the U.S. deduction for Foreign-Derived Deduction Eligible Income and research and development tax credits, partially offset by foreign withholding taxes and a waiver of deductions related to U.S. base erosion payments. Our effective tax rate for the three months ended December 31, 2025 was lower than the U.S. statutory tax rate, mainly due to the U.S. deduction for Foreign-Derived Deduction Eligible Income, research and development tax credits, and valuation allowance release partially offset by foreign withholding taxes and a waiver of deductions related to U.S. base erosion payments.

Previous wording

Cash and cash equivalents at September 30, 2025 and December 31, 2024 totaled $697 million and $714 million, respectively. The primary driver of our current and anticipated future cash flows is, and we expect will continue to be, cash generated from operations, consisting primarily of our net income, excluding non-cash charges and changes in operating assets and liabilities.

Current wording

Cash and cash equivalents at March 31, 2026 and December 31, 2025 totaled $569 million and $675 million, respectively. The primary driver of our current and anticipated future cash flows is, and we expect will continue to be, cash generated from operations, consisting primarily of our net income, excluding non-cash charges and changes in operating assets and liabilities.

Previous wording

Our total cash and cash equivalents at September 30, 2025 consisted of $166 million held in the United States and $531 million held by our foreign subsidiaries. We believe that our current cash and investments position and available borrowing capacity, together with the cash anticipated to be generated from our operations, will be sufficient to satisfy our estimated working capital needs, planned capital expenditure requirements, payments of debt, and any future cash dividends declared by our Board of Directors or share repurchases through at least the next 12 months and the foreseeable future.

Current wording

Our total cash and cash equivalents at March 31, 2026 consisted of $126 million held in the United States and $443 million held by our foreign subsidiaries. We believe that our current cash and cash equivalents and available borrowing capacity, together with the cash anticipated to be generated from our operations, will be sufficient to satisfy our estimated working capital needs, planned capital expenditure requirements, payments of debt, potential settlement of convertible debt conversions and any future cash dividends declared by our Board of Directors or share repurchases through at least the next 12 months and the foreseeable future.

Previous wording

Net cash provided by operating activities was $503 million for the nine months ended September 30, 2025 and resulted from net income of $188 million, which included non-cash charges of $240 million, mainly the result of $258 million in depreciation and amortization, partially offset by $125 million in deferred income taxes and a net decrease in working capital of $75 million. The net decrease in working capital was primarily due to increases in accrued compensation of $55 million, accounts payable of $31 million and income taxes payable of $21 million as well as a decrease in accounts receivable of $24 million and other current and non-current assets of $12 million, partially offset by an increase in inventories of $54 million as well as a decrease in other current and non-current liabilities of $14 million.

Current wording

Net cash provided by operating activities was $53 million for the three months ended March 31, 2026 and resulted from net income of $84 million, which included non-cash charges of $103 million, mainly the result of $85 million in depreciation and amortization, partially offset by $24 million in deferred income taxes and a net increase in working capital of $134 million. The net increase in working capital was primarily due to increases in accounts receivable of $129 million, as a result of higher sales, and inventory of $49 million, and a decrease in current and non-current accrued compensation of $68 million, mainly due to payments of variable compensation. The net increase in working capital was partially offset by increases in accounts payable of $45 million and other current and non-current liabilities of $36 million, and by a decrease in other current and non-current assets of $21 million.

Previous wording

Net cash used in investing activities was $96 million for the nine months ended September 30, 2025 primarily related to capital expenditures of $98 million.

Current wording

Net cash used in investing activities was $25 million for the three months ended March 31, 2026 primarily related to capital expenditures for new facility additions in Malaysia and China.

Previous wording

During the nine months ended September 30, 2025, we repurchased approximately 546,000 shares of our common stock for total consideration of $45 million. During the three months ended September 30, 2025 and the three and nine months ended September 30, 2024, we did not repurchase any shares of common stock. We have repurchased approximately 3.1 million shares of common stock for approximately $172 million pursuant to the program since its adoption.

Current wording

During the three months ended March 31, 2026, we did not repurchase any shares of common stock. During the three months ended March 31, 2025, we repurchased approximately 546,000 shares of our common stock for total consideration of $45 million. We have repurchased approximately 3.1 million shares of common stock for approximately $172 million pursuant to the program since its adoption.

Previous wording

Holders of our common stock are entitled to receive dividends when and if they are declared by our Board of Directors. During each of the first three quarters of 2025 and 2024, our Board of Directors declared a cash dividend of $0.22 per share, totaling $44 million for each of the nine months ended September 30, 2025 and 2024. On November 3, 2025, our Board of Directors declared a quarterly cash dividend of $0.22 per share to be paid on December 5, 2025 to stockholders of record as of November 24, 2025. Future dividend declarations, if any, as well as the record and payment dates for such dividends, are subject to the final determination of our Board of Directors.

Current wording

Holders of our common stock are entitled to receive dividends when and if they are declared by our Board of Directors. For the three months ended March 31, 2026, we paid cash dividends of $17 million in the aggregate of $0.25 per share. For the three months ended March 31, 2025, we paid cash dividends of $15 million in the aggregate of $0.22 per share. Future dividend declarations, if any, as well as the record and payment dates for such dividends, are subject to the final determination of our Board of Directors.

Previous wording

In connection with the completion of the Atotech Acquisition, on August 17, 2022 (the “Effective Date”) we entered into a credit agreement with JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, Barclays Bank PLC, and the lenders from time to time party thereto, which we have amended several times since including, most recently, in January 2025 (as amended, the “Amended Credit Agreement”). As of September 30, 2025, the Amended Credit Agreement provided for (i) a senior secured term loan facility comprised of two tranches: a $2.3 billion loan (the “USD Tranche B”) and a €589 million loan (the “Euro Tranche B” and together with the USD Tranche B, the “Term Loan Facility”) and (ii) a senior secured revolving credit facility of $675 million (the “Revolving Facility” and, together with the Term Loan Facility, the “Credit Facilities”), with the commitments under each of the foregoing facilities subject to increase from time to time subject to certain conditions. In each of January 2025, June 2025, August 2025 and October 2025, we made an additional voluntary prepayment of $100 million principal amount to the USD Tranche B loan.

Current wording

On August 17, 2022, we entered into a credit agreement with JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, Barclays Bank PLC, and the lenders from time to time party thereto, which we have since amended several times, including most recently in February 2026 (as amended, the “Credit Agreement”). As of March 31, 2026, after giving effect to all amendments and repayments prior to such date, the Credit Agreement provided for (i) a senior secured term loan facility comprised of two tranches: a $914 million loan (as refinanced and otherwise modified from time to time, the “USD Tranche B”) and a €587 million loan (as refinanced and otherwise modified from time to time, the “Euro Tranche B” and together with the USD Tranche B, the “Term Loan Facility”) and (ii) a senior secured revolving credit facility with aggregate commitments of $1.0 billion (as refinanced and otherwise modified from time to time, the “Revolving Facility” and, together with the Term Loan Facility, the “Credit Facilities”).

Previous wording

As of September 30, 2025, borrowings under the Credit Facilities bore interest at a rate per annum equal to, at our option, any of the following, plus, in each case, an applicable margin: (a) with respect to the USD Tranche B and the Revolving Facility, (x) a base rate determined by reference to the highest of (1) the federal funds effective rate plus 0.50%, (2) the prime rate quoted in The Wall Street Journal, or (3) a forward-looking term rate based on the variable secured overnight financing rate (“Term SOFR”) (plus an applicable credit spread adjustment) for an interest period of one month, plus 1.00%, and (y) a Term SOFR rate (plus an applicable credit spread adjustment) for the interest period relevant to such borrowing, subject to a rate floor of (I) with respect to the USD Tranche B, 0.50% and (II) with respect to the Revolving Facility, 0.0%; and (b) with respect to the Euro Tranche B, a Euro Interbank Offered Rate (“EURIBOR”) rate determined by reference to the costs of funds for Euro deposits for the interest period relevant to such borrowing adjusted for certain additional costs, subject to a EURIBOR rate floor of 0.0%. As of September 30, 2025, the applicable margins for borrowings under the Credit Facilities were (i) under the USD Tranche B, 1.00% with respect to base rate borrowings and 2.00% with respect to Term SOFR borrowings, (ii) under the Euro Tranche B, 2.50% and (iii) under the Revolving Facility, 1.50% with respect to base rate borrowings and 2.50% with respect to Term SOFR borrowings.

Current wording

As of March 31, 2026, borrowings under the Credit Facilities bore interest at a rate per annum equal to, at our option, any of the following, plus, in each case, an applicable margin: (a) with respect to the USD Tranche B and the Revolving Facility, (x) a base rate determined by reference to the highest of (1) the federal funds effective rate plus 0.50%, (2) the prime rate quoted in The Wall Street Journal, or (3) a forward-looking term rate based on the variable secured overnight financing rate (“Term SOFR”) for an interest period of one month, plus 1.00%, and (y) a Term SOFR rate for the interest period relevant to such borrowing; and (b) with respect to the Euro Tranche B, a Euro Interbank Offered Rate (“EURIBOR”) rate determined by reference to the costs of funds for Euro deposits for the interest period relevant to such borrowing adjusted for certain additional costs, in each case of clauses (a) and (b) above subject to a rate floor of 0.0%. As of March 31, 2026, the applicable margins for borrowings under the Credit Facilities were (i) under the USD Tranche B and the Revolving Facility, 0.75% with respect to base rate borrowings and 1.75% with respect to Term SOFR borrowings and (ii) under the Euro Tranche B, 2.00%.