RBC Bearings INC

Previous wording

Although we believe that the expectations and assumptions reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition, results of operations, and cash flows, as well as any forward-looking statements, are subject to change and to inherent risks and uncertainties, such as those disclosed in this Annual Report on Form 10-K. Factors that could cause our actual results, performance and achievements or industry results to differ materially from estimates or projections contained in forward-looking statements include, among others, the following:

Current wording

Although we believe that the expectations and assumptions reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition, results of operations, and cash flows, as well as any forward-looking statements, are subject to change and to inherent risks and uncertainties, such as those disclosed in this Annual Report on Form 10-K. Factors that could cause our actual results, performance and achievements or industry results to differ from estimates or projections contained in our forward-looking statements include, among others, the following:

Previous wording

These and additional factors that could cause actual results to differ materially from our forward-looking statements are set forth in this Annual Report on Form 10-K under Part I, Item 1. “Business,” Part I, Item 1A. “Risk Factors,” Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and Part II, Item 8. “Financial Statements and Supplementary Data.” All forward-looking statements contained in this report and any subsequently filed reports are expressly qualified in their entirety by these cautionary statements.

Current wording

These and additional factors that could cause actual results to differ from our forward-looking statements are set forth in this Annual Report on Form 10-K under Part I, Item 1. “Business,” Part I, Item 1A. “Risk Factors,” Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and Part II, Item 8. “Financial Statements and Supplementary Data.” All forward-looking statements contained in this report and any subsequently filed reports are expressly qualified in their entirety by these cautionary statements.

Previous wording

Our top ten customers collectively accounted for approximately 44%, 44% and 41% of our net sales during fiscal 2025, 2024 and 2023, respectively. Accordingly, the loss of one or more of those customers or a substantial decrease in those customers’ purchases from us could result in a material reduction in our revenues, cash flows and profitability. If one of our major customers were to experience an adverse change in its business, that customer could reduce its purchases from us.

Current wording

Our top ten customers collectively accounted for approximately 35%, 44% and 44% of our net sales during fiscal 2026, 2025 and 2024, respectively. Accordingly, the loss of one or more of those customers or a substantial decrease in those customers’ purchases from us could result in a material reduction in our revenues, cash flows and profitability. If one of our major customers were to experience an adverse change in its business, that customer could reduce its purchases from us.

Previous wording

The mining and construction equipment and other diversified industrial industries to which we sell our products are, to varying degrees, cyclical and tend to decline in response to overall declines in industrial production. Margins in those industries are highly sensitive to demand cycles, and our customers (or our customers’ customers) in those industries historically have tended to delay large capital purchases and projects, including expensive maintenance and upgrades, during economic downturns. As a result, our business is also cyclical, and the demand for our products by these customers depends, in part, on overall levels of industrial production, general economic conditions, and business confidence levels. Many of our customers have historically experienced periodic downturns, which often have had a negative effect on demand for our products. Future downward economic cycles or customer downturns could reduce sales of our products resulting in reductions in our revenues, cash flows and profitability.

Current wording

The mining and construction equipment and other diversified industrial markets to which we sell products are, to varying degrees, cyclical and tend to decline in response to overall declines in industrial production. Margins in those industries are highly sensitive to demand cycles, and our customers (or our customers’ customers) in those industries historically have tended to delay large capital purchases and projects, including expensive maintenance and upgrades, during economic downturns. As a result, our business is also cyclical, and the demand for our products by these customers depends, in part, on overall levels of industrial production, general economic conditions, and business confidence levels. Many of our customers have historically experienced periodic downturns, which often have had a negative effect on demand for our products. Future downward economic cycles or customer downturns could reduce sales of our products resulting in reductions in our revenues, cash flows and profitability.

Previous wording

In fiscal 2025, approximately 3% of our net sales were made directly, and we estimate that approximately an additional 9% of our net sales were made indirectly, to the U.S. government to support military or other government projects. Our failure (or the failure of our customers that are prime contractors to the government) to obtain new government contracts, the cancellation of government contracts relating to our products, or reductions in federal budget appropriations for programs in which our products are used could materially reduce our revenues, cash flows and profitability. A reduction in federal budget appropriations relating to our products could result from a shift in government defense spending to other programs in which we are not involved or a reduction in U.S. government defense spending generally (due to budget reduction initiatives or a shift in government spending priorities).

Current wording

In fiscal 2026, approximately 1% of our net sales were made directly, and we estimate that approximately an additional 7% of our net sales were made indirectly, to the U.S. government to support military or other government projects. Our failure (or the failure of our customers that are prime contractors to the government) to obtain new government contracts, the cancellation of government contracts relating to our products, or reductions in federal budget appropriations for programs in which our products are used could materially reduce our revenues, cash flows and profitability. A reduction in federal budget appropriations relating to our products could result from a shift in government defense spending to other programs in which we are not involved or a reduction in U.S. government defense spending generally (due to budget reduction initiatives or a shift in government spending priorities).

Previous wording

Changes to and uncertainty in U.S. and international trade policy, including import tariffs imposed by the U.S. and other countries, and the resulting consequences, could adversely affect our revenue and profit margin.

Current wording

U.S. and international import tariffs and other trade policies could adversely affect our revenue and profit margin.

Previous wording

Specifically, U.S.-imposed tariffs increase our cost to import raw materials and component parts from foreign sources (including our foreign operations) which will decrease our profitability to the extent that we are unable to pass the increased cost on to our customers. Any import tariffs imposed on our U.S.-manufactured products by other countries in response to U.S. trade policies will cause those products to be more expensive in those countries, which may reduce our sales in those countries, thereby adversely affecting our revenue, cash flow and profitability. In addition, any tariff-driven reduction in sales of our customers’ products into which our products are integrated will correspondingly reduce the demand for our products, thereby adversely affecting our revenue, profitability and cash flow.

Current wording

In addition to driving up our operating costs, these tariffs and other changes in U.S. trade policy have caused foreign countries to implement retaliatory tariffs and other responsive trade policies that apply to our U.S.-manufactured products sold in those countries, thereby causing those products to be more expensive, which may reduce our sales in those countries, thereby adversely affecting our revenue, cash flow and profitability. In addition, any foreign tariff-driven reduction in sales of our customers’ products into which our products are integrated will correspondingly reduce the demand for our products, thereby adversely affecting our revenue, profitability and cash flow.

Previous wording

In early 2025, the United States imposed tariffs on a vast range of imported goods, including steel and other raw materials needed in our U.S. manufacturing operations, as part of ongoing trade actions against the People’s Republic of China and most other foreign countries. The changes in U.S. trade policy have resulted in multiple other countries implementing retaliatory tariffs and other responsive trade policies that apply to our U.S.-manufactured products sold in their markets. The situation is very fluid at this time, and subject to rapid change as the U.S. increases, decreases, suspends or reinstates tariffs against various countries and products and those countries respond. The tariffs and retaliatory tariffs are driving escalating global trade conflicts which have led to, and may continue to lead to, inflationary pressures and uncertainty, which could impact our operations.

Current wording

The international trade situation is very fluid and subject to rapid change, including litigation, as the U.S. increases, decreases, suspends or reinstates tariffs against various countries and products and those countries respond. The tariffs and retaliatory tariffs are driving escalating global trade conflicts which have led to, and may continue to lead to, inflationary pressures and uncertainty, which could impact our operations.

Previous wording

While we have not experienced a material impact on our business to date, no assurance can be given that will continue to be the case. We are continuing to evaluate the trade situation as it evolves and we are assessing mitigation strategies, including supply chain adjustments and pricing actions. We believe the majority of our imports from Mexico are compliant with the United States-Mexico-Canada Agreement (“USMCA”) and are currently exempt from tariffs upon importing into the United States. The ultimate impact of tariffs on our operations and financial results is currently uncertain and will depend on the scope, duration, and potential expansion of the measures implemented.

Current wording

While we have not experienced a material impact on our business to date, no assurance can be given that will continue to be the case. We are continuing to evaluate the trade situation as it evolves and we are assessing mitigation strategies, including supply chain adjustments and pricing actions. The ultimate impact of tariffs on our operations and financial results is currently uncertain and will depend on the scope, duration, and potential expansion of the measures implemented.

Previous wording

Essential to servicing the aerospace market is the ability to obtain product approvals. We have a substantial number of product approvals, which enable us to provide products used in virtually all domestic aircraft platforms presently in production or operation. Product approvals are typically issued by the FAA to designated OEMs who are Production Approval Holders of FAA-approved aircraft. These Production Approval Holders provide quality control oversight and generally limit the number of suppliers directly servicing the commercial aerospace market. Regulations enacted by the FAA provide for an independent process (the PMA process) that enables suppliers who currently sell their products to the Production Approval Holders to also sell products to the aftermarket. Our foreign sales may be subject to similar approvals or U.S. export control restrictions. We cannot assure you that we will not lose approvals for our aerospace products in the future. The loss or suspension of product approvals could result in lost sales and materially reduce our revenues, cash flows and profitability.

Current wording

Essential to servicing the Aerospace & Defense market is the ability to obtain product approvals. We have a substantial number of product approvals, which enable us to provide products used in virtually all domestic aircraft platforms presently in production or operation. Product approvals are typically issued by the FAA to designated OEMs who are Production Approval Holders of FAA-approved aircraft. These Production Approval Holders provide quality control oversight and generally limit the number of suppliers directly servicing the commercial Aerospace market. Regulations enacted by the FAA provide for an independent process (the PMA process) that enables suppliers who currently sell their products to the Production Approval Holders to also sell products to the aftermarket. Our foreign sales may be subject to similar approvals or U.S. export control restrictions. We cannot assure you that we will not lose approvals for our Aerospace products in the future. The loss or suspension of product approvals could result in lost sales and materially reduce our revenues, cash flows and profitability.

Previous wording

As a U.S. government contractor, we are subject to various procurement and other laws, regulations and contract terms applicable to our industry, including the FAR, the DFARS, the Truth in Negotiations Act, the False Claims Act, the Procurement Integrity Act, the International Traffic in Arms Regulations promulgated under the Arms Export Control Act, the Close the Contractor Fraud Loophole Act, the Foreign Corrupt Practices Act, and CAS, and we could be adversely affected by any negative finding by the U.S. government as to our compliance with them, including suspension or debarment from future government contracting.

Current wording

As a U.S. government contractor, we are subject to various procurement and other laws, regulations and contract terms applicable to our industry, including the FAR, the DFARS, the Truth in Negotiations Act, the False Claims Act, the Procurement Integrity Act, the International Traffic in Arms Regulations promulgated under the Arms Export Control Act, the Close the Contractor Fraud Loophole Act, the Foreign Corrupt Practices Act, and Cost Accounting Standards (CAS), and we could be adversely affected by any negative finding by the U.S. government as to our compliance with them, including suspension or debarment from future government contracting.

Previous wording

We currently have three collective bargaining agreements covering employees at our Plymouth, Indiana, Fairfield, Connecticut and West Trenton, New Jersey facilities, representing approximately 7% of our U.S.-based hourly employees as of March 29, 2025. While we believe our relations with our employees are satisfactory, the inability to satisfactorily negotiate and enter into new collective bargaining agreements upon expiration, or a lengthy strike or other work stoppage at any of our facilities, particularly at some of our larger facilities, could materially reduce our ability to operate our business. In addition, any attempt by our employees not currently represented by a union to join a union could result in additional expenses, including with respect to wages, benefits and pension obligations.

Current wording

We currently have three collective bargaining agreements covering employees at our Plymouth, Indiana, Fairfield, Connecticut and West Trenton, New Jersey facilities, representing approximately 4% of our U.S.-based hourly employees as of March 28, 2026. While we believe our relations with our employees are satisfactory, the inability to satisfactorily negotiate and enter into new collective bargaining agreements upon expiration, or a lengthy strike or other work stoppage at any of our facilities, particularly at some of our larger facilities, could materially reduce our ability to operate our business. In addition, any attempt by our employees not currently represented by a union to join a union could result in additional expenses, including with respect to wages, benefits and pension obligations.

Previous wording

Any potential cost-saving opportunities may take several quarters following an acquisition to implement, and any results of these actions may not be realized for several quarters thereafter, if at all.

Current wording

Any potential cost-saving opportunities may take several quarters or years following an acquisition to implement, and any results of these actions may not be realized for several quarters thereafter, if at all.

Previous wording

Goodwill represents the excess of cost over the fair market value of net assets acquired in business combinations. Indefinite-lived intangibles represent repair station certifications obtained in business combinations and assumed to have indefinite lives. As of March 29, 2025, we had $1,872.2 of goodwill and $24.3 of indefinite-lived intangibles, representing approximately 40% of our total assets. We review goodwill and indefinite-lived intangibles at least annually for impairment and any excess in carrying value over the estimated fair value is charged to the results of operations. Our estimates of fair value are based on assumptions about the future operating cash flows, growth rates, discount rates applied to these cash flows, and current market estimates of value. If we are required to record a charge to earnings because of an impairment of goodwill or indefinite-lived intangibles, our results of operations and financial condition could be materially and adversely affected.

Current wording

Goodwill represents the excess of cost over the fair market value of net assets acquired in business combinations. Indefinite-lived intangibles represent repair station certifications obtained in business combinations and assumed to have indefinite lives. As of March 28, 2026, we had $2,003.4 of goodwill and $24.3 of indefinite-lived intangibles, representing approximately 40% of our total assets. We review goodwill and indefinite-lived intangibles at least annually for impairment and any excess in carrying value over the estimated fair value is charged to the results of operations. Our estimates of fair value are based on assumptions about the future operating cash flows, growth rates, discount rates applied to these cash flows, and current market estimates of value. If we are required to record a charge to earnings because of an impairment of goodwill or indefinite-lived intangibles, our results of operations and financial condition could be materially and adversely affected.

Previous wording

We have operations in Australia, England, Canada, France, Germany, India, Mexico, the Peoples Republic of China, Poland and Switzerland. Of our 54 facilities in 11 countries, 20 are located outside the U.S., including 12 manufacturing facilities in four countries**.**

Current wording

We have operations in Australia, England, Canada, France, Germany, India, Mexico, the Peoples Republic of China, Poland and Switzerland. Of our 65 facilities in 11 countries, 21 are located outside the U.S., including 12 manufacturing facilities in four countries**.**

Previous wording

The majority of our foreign operations utilize the local currency as their functional currency. Foreign currency transaction gains and losses are included in earnings. Foreign currency transaction exposure arises primarily from the transfer of foreign currency from one subsidiary to another within the group and to foreign currency-denominated trade receivables. Unrealized currency translation gains and losses are recorded on the balance sheet upon translation of the foreign operations’ functional currency to the reporting currency. Because our financial statements are denominated in U.S. dollars, changes in currency exchange rates between the U.S. dollar and the currencies used by our international operations have had, and will continue to have, an impact on our earnings. We periodically enter into derivative financial instruments such as cross currency swaps to reduce the effect of fluctuations in exchange rates on transactions and account balances denominated in non-functional currencies. Currency fluctuations may affect our financial performance in the future and we cannot predict the impact of future exchange rate fluctuations on our results of operations. See Part II, Item 7A. “Quantitative and Qualitative Disclosures about Market Risk—Foreign Currency Exchange Rates” of this Annual Report on Form 10-K.

Current wording

The majority of our foreign operations utilize the local currency as their functional currency. Foreign currency transaction gains and losses are included in earnings. Foreign currency transaction exposure arises primarily from the transfer of foreign currency from one subsidiary to another within the group and to foreign currency-denominated trade receivables and payables. Unrealized currency translation gains and losses are recorded on the balance sheet upon translation of the foreign operations’ functional currency to the reporting currency. Because our financial statements are denominated in U.S. dollars, changes in currency exchange rates between the U.S. dollar and the currencies used by our international operations have had, and will continue to have, an impact on our earnings. We periodically enter into derivative financial instruments such as cross currency swaps to reduce the effect of fluctuations in exchange rates on transactions and account balances denominated in non-functional currencies. Currency fluctuations may affect our financial performance in the future and we cannot predict the impact of future exchange rate fluctuations on our results of operations. See Part II, Item 7A. “Quantitative and Qualitative Disclosures about Market Risk—Foreign Currency Exchange Rates” of this Annual Report on Form 10-K.

Previous wording

As of March 29, 2025, we had an order backlog of $940.7. However, orders included in our backlog may be subject to cancellation, delay or other modifications by our customers and we cannot assure you that these orders will ultimately be fulfilled.

Current wording

As of March 28, 2026, we had an order backlog of $2.3 billion. However, orders included in our backlog may be subject to cancellation, delay or other modifications by our customers and we cannot assure you that these orders will ultimately be fulfilled.

Previous wording

We incurred substantial debt in order to complete the Dodge acquisition, which could constrain our business and exposes us to the risk of defaults under our debt instruments.

Current wording

We incurred substantial debt in order to complete the Dodge and VACCO acquisitions, which could constrain our business and exposes us to the risk of defaults under our debt instruments.

Previous wording

In fiscal 2022, we incurred $1,800.0 of total debt to finance the Dodge acquisition. As of March 29, 2025, our total debt was $920.1. This debt could or will have important consequences, including, but not limited to:

Current wording

In fiscal 2022, we incurred $1,800.0 of total debt to finance the acquisition of Dodge Industrial and in July 2025 we incurred $200.0 of debt to finance the acquisition of VACCO Industries. As of March 28, 2026, our total debt was $875.5. This debt could or will have important consequences, including, but not limited to:

Previous wording

Increases in interest rates would increase the cost of servicing our term loan and could reduce our profitability.

Current wording

Increases in interest rates would increase the cost of servicing our bank debt and could reduce our profitability.

Previous wording

As of March 29, 2025, $100.0 of our term loan was subject to a fixed-rate interest swap but the remaining $313.0 balance of the term loan bears interest at a variable rate. Future increases in interest rates would increase the cost of servicing the portion of the term loan not subject to a swap, which could materially reduce our profitability and cash flows.

Current wording

Future increases in interest rates would increase the cost of servicing our bank debt (i.e., term loan and revolving credit facility), which could materially reduce our profitability and cash flows.