Sensata Technologies Holding plc

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements reflect the financial position, results of operations, comprehensive income/(loss), cash flows, and changes in shareholders' equity of Sensata Technologies Holding plc, a public limited company incorporated under the laws of England and Wales, and its consolidated subsidiaries, collectively referred to as the "Company," "Sensata," "we," "our," or "us."

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States ("U.S.") generally accepted accounting principles ("GAAP") for interim financial information and the instructions to Form 10-Q. Accordingly, these interim financial statements do not include all of the information and note disclosures required by U.S. GAAP for complete financial statements. The accompanying interim financial information reflects all normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the interim period results. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the U.S. Securities and Exchange Commission (the "SEC") on February 27, 2026 (the "2025 Annual Report").

During the fourth quarter of 2025, we realigned our business as a result of organizational changes that better allocate our resources to support changes to our business strategy. These changes resulted in the dissolution of our prior segments, Performance Sensing and Sensing Solutions, and the creation ofthree new segments. Our Automotive segment includes both Automotive and Aftermarket businesses. The Industrials segment includes our Industrial and Dynapower businesses. The Aerospace, Defense, and Commercial Equipment segment includes our Aerospace and Commercial Equipment businesses. Our new operating structure allows us to more effectively allocate capital and investment dollars based on different end market and growth dynamics in each of these segments. During the second quarter of 2026, we moved our ASICs products from the Industrials reportable segment to the Automotive reportable segment and our motors products from our Industrials reportable segment to the Aerospace, Defense, and Commercial Equipment reportable segment to align with new management reporting. Prior period amounts in this Quarterly Report on Form 10-Q have been recast to reflect this realignment and the movement of products described above and to conform to current year presentation. Refer to Note 15: Segment Reporting for additional information.

All U.S. dollar ("USD") and share amounts presented, except per share amounts, are stated in millions, unless otherwise indicated. We round amounts in the consolidated financial statements within tables and text (unless otherwise specified) and calculate all percentages and per-share data from underlying whole-dollar amounts. Thus, certain amounts may not foot, crossfoot, or recalculate based on reported numbers due to rounding. Certain reclassifications have been made to prior periods to conform to current period presentation.

2. New Accounting Standards

In November 2024, the FASB issued ASU No. 2024-03 Income Statement (Topic 220): Reporting Comprehensive Income, which requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU No. 2024-03 does not change or remove current expense presentation requirements within the Consolidated Statements of Operations. However, the update requires disclosure, on an annual and interim basis, of disaggregated information about certain income statement expense line items within the notes to the consolidated financial statements. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact that the adoption of ASU No. 2024-03 will have on its consolidated financial statements and disclosures.

In September 2025, the FASB issued ASU No. 2025-06, Intangibles-Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. This update improves the operability of the guidance by removing all references to software development project stages so that the guidance is neutral to different software development methods. ASU No. 2025-06 is effective for annual reporting periods beginning after December 15, 2027, including interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. This ASU can be applied prospectively, retrospectively, or with a modified transition approach. The Company is currently evaluating the impact that the adoption of ASU No. 2025-06 will have on its consolidated financial statements and disclosures.

In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements. This guidance amends existing guidance to simplify the application of hedge accounting, enhance alignment between risk management activities and financial reporting, and provide additional flexibility in the designation and measurement of certain hedging relationships. The amendments included in the five matters addressed in this ASU are intended to better reflect those strategies in financial reporting by enabling entities to achieve and maintain hedge accounting for highly effective economic hedges of forecasted transactions. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the impact that the adoption of ASU No. 2025-09 will have on its consolidated financial statements and disclosures.

In May 2026, the FASB issued ASU No. 2026-02 Environmental Credits and Environmental Credit Obligations (Topic 818). This update provides recognition, measurement, presentation and disclosure requirements for environmental credits and related environmental credit obligations for entities that generate, purchase or receive environmental credits or have a regulatory compliance obligation that may be settled with environmental credits. This update is effective for annual periods beginning after December 15, 2027, including interim periods within those fiscal years. The Company is currently evaluating the impact that the adoption of ASU No. 2026-02 will have on its consolidated financial statements and disclosures.

3. Revenue Recognition

We recognize revenue to depict the transfer of promised goods to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods. The majority of our revenue is derived from the sale of tangible products whereby (1) control of the product transfers to the customer at a point in time, (2) we recognize revenue at a point in time, and (3) the underlying contract is a purchase order that establishes a firm purchase commitment for a short period of time. Our standard terms of sale provide our customers with a limited warranty against faulty workmanship and the use of defective materials.

We have elected to apply certain practical expedients that allow for more limited disclosures than those that would otherwise be required by FASB ASC Topic 606, including (1) the disclosure of transaction price allocated to the remaining unsatisfied performance obligations at the end of the period and (2) an explanation of when we expect to recognize the related revenue.

We believe that our geographic regions are the categories that best depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. Refer to Note 15: Segment Reporting for additional information.

4. Share-Based Payment Plans

The following table presents the components of non-cash compensation expense related to our equity awards for the three and nine months ended September 30, 2026 and 2025:

Equity Awards

During the second quarter of 2026, the Company's board of directors adopted an amendment to the 2021 Equity Incentive Plan to increase the number of shares that may be awarded by 2,890,000 shares, bringing the total to 8,590,000 shares.

We granted the following restricted stock units ("RSUs" and each, an "RSU") and performance-based restricted stock units ("PRSUs" and each, a "PRSU") under the Sensata Technologies Holding plc 2021 Equity Incentive Plan during the nine months ended September 30, 2026:

(1) These RSUs cliff vestone year from the grant date (in June 2027).

(2) These RSUs vest ratably over three years, one-third per year beginning on the first anniversary of the grant date. These RSUs will fully vest on various dates between January 2029 and September 2029.

(3) These PRSUs vest on various dates between April 2029 and August 2029. The number of units that ultimately vest will be between 0% and 200% and is dependent on the achievement of certain performance criteria.

(4) These awards include certain PRSUs with market performance conditions that will be evaluated relative to the performance of certain peers as defined in the award agreement. The number of units that ultimately vest (in April 2029 and August 2029) will be from 0% to 200%, depending on achievement of these performance criteria. The total grant date value of these PRSUs is approximately $8.9 million and was valued using the Monte Carlo method.

5. Restructuring and Other Charges, Net

Transformation Plan

In the year ended December 31, 2025, we committed to a plan to reorganize our business (the “Transformation Plan”). The Transformation Plan, consisting of leadership transitions, involuntary reductions-in-force, site closures, and other cost-savings initiatives, was commenced to competitively reposition ourselves to capture growth from evolving market conditions.

Over the life of the Transformation Plan, we expect to incur restructuring charges of between $22.0 million and $28.0 million, primarily related to reductions-in-force and related site closure costs. All restructuring costs are excluded from segment results. The majority of the actions under the Transformation Plan are expected to be completed on or before June 30, 2028. We expect to settle these charges with cash on hand.

Summary

The following table presents the components of restructuring and other charges, net for the three and nine months ended September 30, 2026, and 2025:

The following table presents a rollforward of our severance liability, which is primarily related to the Transformation Plan, for the nine months ended September 30, 2026:

The severance liability as of September 30, 2026 and December 31, 2025 was entirely recorded in accrued expenses and other current liabilities on our condensed consolidated balance sheets.

6. Other, Net

The following table presents the components of other, net for the three and nine months ended September 30, 2026 and 2025:

7. Income Taxes

The following table presents the provision for income taxes for the three and nine months ended September 30, 2026 and 2025:

The provision for income taxes consists of (1) current tax expense, which relates primarily to our profitable operations in tax jurisdictions with limited or no net operating loss carryforwards and withholding taxes related to management fees, royalties, and the repatriation of foreign earnings; and (2) deferred tax expense (or benefit), which represents adjustments in book-to-tax basis differences primarily related to (a) book versus tax basis in intangible assets, (b) changes in net operating loss carryforwards and tax credits, and (c) changes in withholding taxes on unremitted earnings.

During the third quarter of 2025, our provision for income taxes was unfavorably impacted by the impairment of nondeductible goodwill.

8. Net Income/(Loss) per Share

Basic and dilutednet income/(loss) per share are calculated by dividingnet income/(loss) by the number of basic and diluted weighted-average ordinary shares outstanding during the period. For the three and nine months ended September 30, 2026 and 2025 the weighted-average ordinary shares outstanding used to calculate basic and dilutednet income/(loss) pershare were as follows:

Net income/(loss) andnet income/(loss) per share are presented in the condensed consolidated statements of operations.

Certain potential ordinary shares were excluded from our calculation of diluted weighted-average ordinary shares outstanding because either they would have had an anti-dilutive effectonnet income/(loss) per share or they related to equity awards that were contingently issuable for which the contingency had not been satisfied. These potential ordinary shares were as follows:

9. Inventories

The following table presents the components of inventories as of September 30, 2026 and December 31, 2025:

10. Debt

Fiscal Year 2026 Transactions

Debt Extinguishments and Repurchases

During the three months ended September 30, 2026, we repurchased $32.6 million in aggregate principal amount of our 4.0% Senior Notes due 2029 ("the 4.0% Senior Notes") in open market repurchases. We paid $31.8 million in the aggregate for such purchases.

In May 2026, Sensata Technologies B.V. and Sensata Technologies, Inc., our indirect, wholly owned subsidiaries, announced the commencement of a cash tender offer for up to $400.0 million of aggregate cash consideration payable for the 4.0% Senior Notes, the 4.375% Senior Notes due 2030 (the "4.375% Senior Notes"), and the 5.875% Senior Notes due 2030 (the "5.875% Senior Notes"). In June 2026, we purchased $406.1 million in aggregate principal amount of the 4.0% Senior Notes that were validly tendered in connection with that tender offer. We paid $400.0 million in cash in the aggregate for such purchase. We did not purchase any 4.375% Senior Notes or 5.875% Senior Notes in these tender offers.

Summary

The following table presents the components of long-term debt, net and finance lease obligations as of September 30, 2026 and December 31, 2025:

Our indebtedness as of September 30, 2026 and December 31, 2025 consists of various tranches of senior unsecured notes as shown in the table above. We also have secured credit facilities (the "Senior Secured Credit Facilities") which provide for our $650.0 million revolving credit facility (the "Revolving Credit Facility") and incremental availability under which additional debt can be issued. Refer to Note 14: Debt of our 2025 Annual Report for additional information related to our indebtedness.

Revolving Credit Facility

As of September 30, 2026, we had $645.8 million available under the Revolving Credit Facility, net of $4.2 million of obligations in respect of outstanding letters of credit issued thereunder. Outstanding letters of credit are issued primarily for the benefit of certain operating activities. As of September 30, 2026, no amounts had been drawn against these outstanding letters of credit.

During April 2026, the Company entered into a technical amendment to the Revolving Credit Facility correcting and clarifying certain details to conform the language with the intention of the Fourteenth Amendment that was signed in September 2025.

Accrued Interest

Accrued interest associated with our outstanding debt is included as a component of accrued expenses and other current liabilities in the condensed consolidated balance sheets. As of September 30, 2026 and December 31, 2025, accrued interest totaled $19.4 million and $48.6 million, respectively.

11. Commitments and Contingencies

We are regularly involved in a number of claims and litigation matters that arise in the ordinary course of business. Although it is not feasible to predict the outcome of these matters, based upon our experience and current information known to us, we do not expect the outcome of these matters, either individually or in the aggregate, to have a material adverse effect on our results of operations, financial condition, and/or cash flows.

Other Matters

Following the February 2026 ruling by the United States Supreme Court striking down certain tariffs imposed under the International Emergency Economic Powers Act, U.S. Customs and Border Protection has since announced steps toward an administrative process to address potential tariff refunds. However, the availability, timing, and amount of potential refunds remain uncertain and are subject to ongoing legal, regulatory, and administrative developments.

12. Shareholders' Equity

Cash Dividends

In the three and nine months ended September 30, 2026, we paid aggregate cash dividends of $17.5 million and $52.4 million, respectively, compared to $17.5 million and $52.9 million in the three and nine months ended September 30, 2025, respectively. In October 2026, we announced that our Board of Directors approved a quarterly dividend of $0.12 per share, payable in November 2026 to shareholders of record as of November 11, 2026.

Treasury Shares

From time to time, our Board of Directors has authorized various share repurchase programs, which may be modified or terminated by the Board at any time. Under these programs, we may repurchase ordinary shares at such times and in amounts to be determined by our management, based on market conditions, legal requirements, and other corporate considerations, on the open market or in privately negotiated transactions, provided that such transactions were completed pursuant to an agreement and with a third party approved by our shareholders at the annual general meeting. Ordinary shares repurchased by us are recognized, measured at cost, and presented as treasury shares on our consolidated balance sheets, resulting in a reduction of shareholders' equity. In September 2023, our Board of Directors authorized a $500.0 million ordinary share repurchase program (the “September 2023 Program”), which became effective on October 1, 2023.

In the three months ended September 30, 2026 and September 30, 2025, we didnot purchase any shares under our share repurchase program. In the nine months ended September 30, 2026 and 2025, we repurchased 0.7 million and 4.2 million ordinary shares for $25.1 million and $120.6 million, respectively. All share repurchases in the three and nine months ended September 30, 2026 and 2025 were made under the September 2023 Program. As of September 30, 2026, $257.3 million remained available for repurchase under the September 2023 Program.

Accumulated Other Comprehensive Income/Loss

The following table presents the components of accumulated other comprehensive income/loss for the nine months ended September 30, 2026:

The following table presents the amounts reclassified from accumulated other comprehensive income/loss for the three and nine months ended September 30, 2026 and 2025:

(1) Refer to Note 14: Derivative Instruments and Hedging Activities for additional information regarding amounts to be reclassified from accumulated other comprehensive income/loss in future periods.

13. Fair Value Measures

Measured on a Recurring Basis

The fair values of our assets and liabilities measured at fair value on a recurring basis as of September 30, 2026 and December 31, 2025 are shown in the below table.

Refer to Note 14: Derivative Instruments and Hedging Activities for additional information regarding our forward contracts. Cash equivalents consist of U.S. Government Treasury money market funds and are classified as Level 1 as they are exchange traded in an active market.

Measured on a Nonrecurring Basis

In the third quarter of 2025, we determined that our Dynapower reporting unit was impaired, and we recorded a $225.7 million non-cash impairment charge. If Dynapower does not achieve the forecasted future cash flows, or if the discount rate or other assumptions were to change, it is reasonably possible that additional impairments of the remaining $4.1 million of goodwill may be recognized in the future. No such impairment charges were identified in the three and nine months ended September 30, 2026.

Financial Instruments Not Recorded at Fair Value

The following table presents the carrying values and fair values of financial instruments not recorded at fair value in the condensed consolidated balance sheets as of September 30, 2026 and December 31, 2025. All fair value measures presented are categorized in Level 2 of the fair value hierarchy.

(1) Excluding any related debt discounts, premiums, and deferred financing costs.

We hold certain equity investments that do not have readily determinable fair values for which we use the measurement alternative prescribed in FASB ASC Topic 321. Such investments are measured at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. As of September 30, 2026 and December 31, 2025, we held equity investments under the measurement alternative of $9.6 million and$7.3 million, respectively, which are presented in other assets in the condensed consolidated balance sheets.

14. Derivative Instruments and Hedging Activities

Foreign Currency Derivatives

As of September 30, 2026, we had the following outstanding foreign currency forward contracts, which had the below hedge accounting designation in accordance with FASB ASC Topic 815, Derivatives and Hedging:

(1) Derivative financial instruments not designated as hedges are used to manage our exposure to currency exchange rate risk. They are intended to preserve economic value, and they are not used for trading or speculative purposes.

As of September 30, 2026, we estimate that $19.5 million of net gain will be reclassified from accumulated other comprehensive income/loss to earnings during the twelve-month period ending September 30, 2027.

Financial Instrument Presentation

The following table presents the fair values of our derivative financial instruments and their classification in the condensed consolidated balance sheets as of September 30, 2026 and December 31, 2025:

These fair value measurements were all categorized within Level 2 of the fair value hierarchy.

The following tables present the effect of our derivative financial instruments on the condensed consolidated statements of operations and the condensed consolidated statements of comprehensive income/(loss) for the three months ended September 30, 2026 and 2025:

The following tables present the effect of our derivative financial instruments on the condensed consolidated statements of operations and the condensed consolidated statements of comprehensive income/(loss) for the nine months ended September 30, 2026 and 2025:

Credit Risk Related Contingent Features

We have agreements with our derivative counterparties that contain a provision whereby if we default on our indebtedness and repayment of the indebtedness has been accelerated by the lender, then we could also be declared in default on our derivative obligations.

As of September 30, 2026, the termination value of outstanding derivatives in a liability position, excluding any adjustment for non-performance risk, was $5.2 million. As of September 30, 2026, we hadnot posted any cash collateral related to these agreements. If we breach any of the default provisions on any of our indebtedness as described above, we could be required to settle our obligations under the derivative agreements at their termination values.

15. Segment Reporting

We present financial information forthree reportable segments, Automotive, Industrials, and Aerospace, Defense, and Commercial Equipment. In the last quarter of 2025, we realigned our segments as a result of organizational changes that better allocate our resources to support changes to our business strategy. Refer to Note 1: Basis of Presentation for additional information. Our operating segments are business segments that we manage as components of an enterprise, for which separate financial information is evaluated regularly by our chief operating decision maker ("CODM"), who is our chief executive officer, in deciding how to allocate resources and assess performance.

An operating segment’s performance is primarily evaluated based on segment operating income, which excludes amortization of intangible assets, impairment of goodwill and other intangible assets, restructuring charges, and certain corporate costs or credits not associated with the operations of the segment. Corporate and other costs excluded from a segment’s performance are separately stated below and include costs that are related to functional areas such as finance, information technology, legal, and human resources. The CODM uses operating income primarily in the annual budget and forecasting process. The CODM considers budget-to-actual variances on a quarterly basis for operating income when making decisions about the allocation of resources to each segment. We believe that segment operating income, as defined above, is an appropriate measure for evaluating the operating performance of our segments. However, the measure should be considered in addition to, and not as a substitute for, or superior to, operating income or other measures of financial performance prepared with U.S. GAAP. The accounting policies of each of our operating and reportable segments are materially consistent with those described in Note 2: Significant Accounting Policiesof the audited consolidated financial statements and notes thereto included in our 2025 Annual Report.

The Automotive segment primarily serves the Automotive OEM and aftermarket industries through the development and manufacturing of sensors, high-voltage solutions (i.e., electrical protection components), and other solutions that are used in mission-critical systems and applications.

Industrials primarily serves industrial customers through the development and manufacturing of a broad portfolio of application-specific sensor, power management, and electrical protection products used in a diverse range of industrial markets, including the appliance, HVAC, material handling, charging infrastructure, renewable energy generation, and microgrid applications and markets.

The Aerospace, Defense, and Commercial Equipment segment primarily serves the aerospace, including commercial aircraft, defense, and commercial equipment, which includes on-road truck, construction, and agriculture markets, through the development and manufacture of a variety of sensors, electrical protection products, operator controls, and other solutions that are used in mission-critical systems and applications.

The following table presents net revenue, operating expenses, and operating income for the reportable segments and other operating results not allocated to our reportable segments for the three and nine months ended September 30, 2026 and 2025:

(1) The amounts previously reported for the three and nine months ended September 30, 2025 have been retrospectively recast to reflect the segment realignment as discussed in Note 1: Basis of Presentation.

(2) During the third quarter of 2026, we received a payment of $24.0 million from a customer related to the cancellation of an electric vehicle program.

(3) Segment operating expenses include research, development, and engineering, and selling, general and administrative expenses associated with each segment.

The following table presents depreciation and amortization expense for our reportable segments and corporate and other for the three and nine months ended September 30, 2026 and 2025:

(1)Included within corporate and other is depreciation expense, amortization of intangible assets, and accelerated depreciation recognized in connection with restructuring actions. We do not allocate these amounts to our segments. This treatment is consistent with the financial information reviewed by our chief operating decision maker.

The following table presents additions to property, plant and equipment ("PP&E") and capitalized software for our reportable segments and corporate and other for the three and nine months ended September 30, 2026 and 2025:

Geographic Area Information

The following tables present net revenue by geographic area and by significant country for the three and nine months ended September 30, 2026 and 2025. In these tables, net revenue is aggregated according to the location of our subsidiaries.

The following tables present PP&E, net, by geographic area and by significant country as of September 30, 2026 and December 31, 2025. In these tables, PP&E, net is aggregated based on the location of our subsidiaries.

16. Disposals

Magnetic Speed and Position Business ("MSP Business")

In November 2024, we executed a purchase agreement whereby we agreed to sell the MSP Business to a third party. The closing of the transaction occurred in the first quarter of 2025, at which time the net assets were transferred to the buyer.

Cautionary Statements Concerning Forward-Looking Statements

This Quarterly Report on Form 10-Q includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by terminology such as "may," "will," "could," "should," "expect," "anticipate," "believe," "estimate," "predict," "project," "forecast," "continue," "intend," "plan," "potential," "opportunity," "guidance," and similar terms or phrases. Forward-looking statements involve, among other things, expectations, projections, and assumptions about future financial and operating results, objectives, business and market outlook, trends, priorities, growth, shareholder value, capital expenditures, cash flows, demand for products and services, share repurchases, and Sensata’s strategic initiatives, including those relating to acquisitions and dispositions and the impact of such transactions on our strategic plans, operational plans, and financial results. These statements are subject to risks, uncertainties, and other important factors relating to our operations and business environment, and we can give no assurances that these forward-looking statements will prove to be correct.

A wide variety of potential risks, uncertainties, and other factors could materially affect our ability to achieve the results either expressed or implied by these forward-looking statements, including, but not limited to, risks related to instability and changes in the global markets, supplier interruption or non-performance, changes in trade-related tariffs and risks with uncertain trade environments, the acquisition or disposition of businesses, variability in metals pricing, cybersecurity, adverse conditions or competition in the industries upon which we are dependent, intellectual property, product liability, warranty, and recall claims, public health crises, market acceptance of new product introductions and product innovations, labor disruptions or increased labor costs, and changes in existing environmental or safety laws, regulations, and programs.

Investors and others should carefully consider the foregoing factors and other uncertainties, risks, and potential events including, but not limited to, those described in Item 1A: Risk Factors included in our 2025 Annual Report and as may be updated from time to time in Item 1A: Risk Factors included in our quarterly reports on Form 10-Q or other subsequent filings with the United States Securities and Exchange Commission. All such forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update these statements other than as required by law.