AMPHENOL CORP DE

Previous wording

The following discussion and analysis of the financial condition and results of operations for the three months ended March 31, 2024 and 2023 has been derived from and should be read in conjunction with our unaudited Condensed Consolidated Financial Statements and the accompanying notes thereto included in Part I, Item 1 herein for Amphenol Corporation (together with its subsidiaries, “Amphenol,” the “Company,” “we,” “our” or “us”). The following discussion and analysis should also be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (the “2023 Annual Report”). The Condensed Consolidated Financial Statements have been prepared in U.S. dollars, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”). The following discussion and analysis also includes references to certain non-GAAP financial measures, which are defined in the “Non-GAAP Financial Measures” section below, including “Constant Currency Net Sales Growth” and “Organic Net Sales Growth.” For purposes of the following discussion, the terms “constant currencies” and “organically” have the same meaning, respectively, as these aforementioned non-GAAP financial measures. Refer to “Non-GAAP Financial Measures” within this Item 2 for more information, including our reasons for including non-GAAP financial measures and material limitations with respect to the usefulness of the measures.

Current wording

The following discussion and analysis of the financial condition and results of operations for the three and six months ended June 30, 2024 and 2023 has been derived from and should be read in conjunction with our unaudited Condensed Consolidated Financial Statements and the accompanying notes thereto included in Part I, Item 1 herein for Amphenol Corporation (together with its subsidiaries, “Amphenol,” the “Company,” “we,” “our” or “us”). The following discussion and analysis should also be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (the “2023 Annual Report”). The Condensed Consolidated Financial Statements have been prepared in U.S. dollars, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”). The following discussion and analysis also includes references to certain non-GAAP financial measures, which are defined in the “Non-GAAP Financial Measures” section below, including “Constant Currency Net Sales Growth” and “Organic Net Sales Growth.” For purposes of the following discussion, the terms “constant currencies” and “organically” have the same meaning, respectively, as these aforementioned non-GAAP financial measures. Refer to “Non-GAAP Financial Measures” within this Item 2 for more information, including our reasons for including non-GAAP financial measures and material limitations with respect to the usefulness of the measures.

Previous wording

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which relate to future events and are subject to risks and uncertainties. All statements that address events or developments that we expect or believe may or will occur in the future are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such forward-looking statements are based on our management’s assumptions and beliefs about future events or circumstances using information currently available, and as a result, they are subject to risks and uncertainties. The forward-looking statements, which address the Company’s expected business and financial performance and financial condition, among other matters, may contain words and terms such as: “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “look ahead,” “may,” “ongoing,” “optimistic,” “plan,” “potential,” “predict,” “project,” “seek,”“should,” “target,” “will” or “would” and other words and terms of similar meaning.

Current wording

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which relate to future events and are subject to risks and uncertainties, including but not limited to, the risk factors described in Part I, Item 1A. of the 2023 Annual Report. All statements that address events or developments that we expect or believe may or will occur in the future are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such forward-looking statements are based on our management’s assumptions and beliefs about future events or circumstances using information currently available, and as a result, they are subject to risks and uncertainties. The forward-looking statements, which address the Company’s expected business and financial performance and financial condition, among other matters, may contain words and terms such as: “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “look ahead,” “may,” “ongoing,” “optimistic,” “plan,” “potential,” “predict,” “project,” “seek,”“should,” “target,” “will” or “would” and other words and terms of similar meaning.

Previous wording

Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about expected earnings, revenues, growth, liquidity, effective tax rate, interest rates or other matters. Although the Company believes the expectations reflected in all forward-looking statements are based upon reasonable assumptions, the expectations may not be attained or there may be material deviation. Readers and investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. There are risks and uncertainties that could cause actual results to differ materially from these forward-looking statements, which include, but are not limited to, the following: political, economic, military and other risks related to operating in countries outside the United States, as well as changes in general economic conditions, geopolitical conditions, U.S. trade policies (including, but not limited to, sanctions) and other factors beyond the Company’s control; uncertainties associated with an economic slowdown or recession in any of the Company’s end markets that could negatively affect the financial condition of our customers and could result in reduced demand; risks and impacts associated with adverse public health developments, including epidemics and pandemics; risks associated with our inability to obtain certain raw materials and components, as well as the increasing cost of certain of the Company’s raw materials and components; cybersecurity threats and techniques used to disrupt operations and gain unauthorized access to our information technology systems, including, but not limited to, malware, social engineering/phishing, credential harvesting, ransomware, malfeasance by insiders, human or technological error and other increasingly sophisticated attacks, that continue to expand and evolve, including through the use of artificial intelligence and machine learning, which could, among other things, impair our information technology systems and

Current wording

Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about expected earnings, revenues, growth, liquidity, effective tax rate, interest rates, the expected timing for the closing of certain acquisitions or other matters. Although the Company believes the expectations reflected in all forward-looking statements are based upon reasonable assumptions, the expectations may not be attained or there may be material deviation. Readers and investors are cautioned not to place undue reliance on these forward-looking

Previous wording

disrupt business operations, result in reputational damage that may cause the loss of existing or future customers, loss of our intellectual property, the loss of or inability to access confidential information and critical business, financial or other data, and/or cause the release of highly sensitive confidential or personal information, and potentially lead to litigation and/or governmental investigations, fines and other penalties, among other risks, and risks and impacts associated with a demanding and evolving regulatory environment surrounding information security and privacy, including additional costs; negative impacts caused by extreme weather conditions and natural catastrophic events, including those caused or intensified by climate change and global warming; risks associated with the increasing scrutiny and expectations regarding environmental, social and corporate governance matters that could result in additional costs or risks or otherwise adversely impact our business; risks associated with the improper conduct by any of our employees, customers, suppliers, distributors or any other business partners which could impair our business reputation and financial results and could result in our non-compliance with anti-corruption laws and regulations of the U.S. government and various foreign jurisdictions; changes in exchange rates of the various currencies in which the Company conducts business; the risks associated with the Company’s dependence on attracting, recruiting, hiring and retaining skilled employees, including as part of our various management teams; risks and difficulties in trying to compete successfully on the basis of technology innovation, product quality and performance, price, customer service and delivery time; the Company’s dependence on end market dynamics to sell its products, particularly in the communications, automotive and defense end markets, pricing pressures resulting from large customers that regularly exert pressure on their suppliers, including the Company, and changes in defense expenditures of the U.S. and non-U.S. governments, which are subject to political and budgetary fluctuations and constraints, all of which could adversely affect its operating results; difficulties and unanticipated expenses in connection with purchasing and integrating newly acquired businesses, including the potential for the impairment of goodwill and other intangible assets; events beyond the Company’s control that could lead to an inability to meet its financial and other covenants and requirements, which could result in a default under the Company’s revolving credit facility or any of our various senior notes; risks associated with the Company’s inability to access the global capital markets on favorable terms, including as a result of significant deterioration of general economic or capital market conditions, or as a result of a downgrade in the Company’s credit rating; changes in interest rates; government contracting r…

Excerpt shortened here; the source contains the full paragraph.

Current wording

statements, which speak only as of the date on which they are made. There are risks and uncertainties that could cause actual results to differ materially from these forward-looking statements, which include, but are not limited to, the following: political, economic, military and other risks related to operating in countries outside the United States, as well as changes in general economic conditions, geopolitical conditions, U.S. trade policies (including, but not limited to, sanctions) and other factors beyond the Company’s control; uncertainties associated with an economic slowdown or recession in any of the Company’s end markets that could negatively affect the financial condition of our customers and could result in reduced demand; risks and impacts associated with adverse public health developments, including epidemics and pandemics; risks associated with our inability to obtain certain raw materials and components, as well as the increasing cost of certain of the Company’s raw materials and components; cybersecurity threats and techniques used to disrupt operations and gain unauthorized access to our information technology systems, including, but not limited to, malware, social engineering/phishing, credential harvesting, ransomware, malfeasance by insiders, human or technological error and other increasingly sophisticated attacks, that continue to expand and evolve, including through the use of artificial intelligence and machine learning, which could, among other things, impair our information technology systems and disrupt business operations, result in reputational damage that may cause the loss of existing or future customers, loss of our intellectual property, the loss of or inability to access confidential information and critical business, financial or other data, and/or cause the release of highly sensitive confidential or personal information, and potentially lead to litigation and/or governmental investigations, fines and other penalties, among other risks, and risks and impacts associated with an increasingly demanding regulatory environment surrounding information security and privacy, including additional fines, penalties and costs; negative impacts caused by extreme weather conditions and natural catastrophic events, including those caused or intensified by climate change and global warming; risks associated with the increasing scrutiny and expectations regarding environmental, social and corporate governance matters that could result in additional costs or risks or otherwise adversely impact our business; risks associated with the improper conduct by any of our employees, customers, suppliers, distributors or any other business partners which could impair our business reputation and financial results and could result in our non-compliance with anti-corruption laws and regulations of the U.S. government and various foreign jurisdictions; changes in exchange rates of the various currencies in which the Company conducts busin…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

A further description of these uncertainties and other risks can be found in the 2023 Annual Report, Quarterly Reports on Form 10-Q and the Company’s other reports filed with the Securities and Exchange Commission. These or other uncertainties not identified in these documents (that we either currently do not expect to have an adverse effect on our business or that we are unable to predict or identify at this time) may cause the Company’s actual future results to be materially different from those expressed in any forward-looking statements. The Company undertakes no obligation to update or revise any forward-looking statements except as required by law.

Current wording

A further description of these uncertainties and other risks can be found in the 2023 Annual Report, Quarterly Reports on Form 10-Q and the Company’s other reports filed with the Securities and Exchange Commission. These or other uncertainties not identified in these documents (that we either currently do not expect to have an adverse effect on

Previous wording

●Harsh Environment Solutions – the Harsh Environment Solutions segment designs, manufactures and markets a broad range of ruggedized interconnect products, including connectors and interconnect systems, printed circuits and printed circuit assemblies and other products for use in the industrial, defense,

Current wording

●Harsh Environment Solutions – the Harsh Environment Solutions segment designs, manufactures and markets a broad range of ruggedized interconnect products, including connectors and interconnect systems, printed circuits and printed circuit assemblies and other products for use in the industrial, defense, commercial aerospace, automotive, mobile networks and information technology and data communications end markets.

Previous wording

On August 16, 2022, the President of the United States signed into law the Inflation Reduction Act of 2022 (the “IRA”), a tax and spending package that introduces several tax-related provisions, including a 15% corporate alternative minimum tax (“CAMT”) on certain large corporations and a 1% excise tax on certain corporate stock repurchases. Companies are required to reassess their valuation allowances for certain affected deferred tax assets in the period of enactment but do not need to remeasure deferred tax balances for the related tax accounting implications of the CAMT. The IRA provisions, which became effective for Amphenol beginning on January 1, 2023, did not have a material impact on the Company during the three months ended March 31, 2024 and 2023. While the full impact of these provisions in the future depends on several factors, including interpretive regulatory guidance, which has not yet been released, the Company does not currently believe that the provisions of the IRA, including several other non-tax related provisions, will have a material impact on its financial condition, results of operations, liquidity and cash flows.

Current wording

On August 16, 2022, the President of the United States signed into law the Inflation Reduction Act of 2022 (the “IRA”), a tax and spending package that introduces several tax-related provisions, including a 15% corporate alternative minimum tax (“CAMT”) on certain large corporations and a 1% excise tax on certain corporate stock repurchases. Companies are required to reassess their valuation allowances for certain affected deferred tax assets in the period of enactment but do not need to remeasure deferred tax balances for the related tax accounting implications of the CAMT. The IRA provisions, which became effective for Amphenol beginning on January 1, 2023, did not have a material impact on the Company during the three and six months ended June 30, 2024 and 2023. While the full impact of these provisions in the future depends on several factors, including interpretive regulatory guidance, which has not yet been released, the Company does not currently believe that the provisions of the IRA, including several other non-tax related provisions, will have a material impact on its financial condition, results of operations, liquidity and cash flows.

Previous wording

The Organization for Economic Co-operation and Development (OECD)/G20 Inclusive Framework, known as Pillar Two, provides guidance for a global minimum tax. This guidance lays out a common approach for adopting the global minimum tax and enacting local legislation codifying the provisions that all 142 countries in the Inclusive Framework agreed to by consensus. The European Union (“EU”) member states have agreed to adopt these rules in two stages. The first component became effective on January 1, 2024, and the second component will become effective January 1, 2025. Non-EU countries have enacted or are expected to enact legislation on a similar timeline. Certain countries in which we operate have already enacted legislation to adopt the Pillar Two framework, while several other countries are expected to also implement similar legislation with varying effective dates in the future. When and how this framework is adopted or enacted by the various countries in which we do business will increase tax complexity and may increase uncertainty and adversely affect our provision for income taxes in the U.S. and non-U.S. jurisdictions. The Company has done a preliminary review of currently enacted legislation. The initial implementation did not have a material impact on the Company’s condensed consolidated financial statements during the three months ended March 31, 2024, and it is not currently expected to have a material impact on the Company’s operations, financial condition or cash flows in the future. However, the Company will continue to evaluate the potential impact of Pillar Two on the Company and its results as additional countries adopt legislation and issue individual guidance on their enacted legislation.

Current wording

The Organization for Economic Co-operation and Development (OECD)/G20 Inclusive Framework, known as Pillar Two, provides guidance for a global minimum tax. This guidance lays out a common approach for adopting the global minimum tax and enacting local legislation codifying the provisions that all 142 countries in the Inclusive Framework agreed to by consensus. The European Union (“EU”) member states have agreed to adopt these rules in two stages. The first component became effective on January 1, 2024, and the second component will become effective January 1, 2025. Non-EU countries have enacted or are expected to enact legislation on a similar timeline. Certain countries in which we operate have already enacted legislation to adopt the Pillar Two framework, while several other countries are expected to also implement similar legislation with varying effective dates in the future. When and how this framework is adopted or enacted by the various countries in which we do business will increase tax complexity and may increase uncertainty and adversely affect our provision for income taxes in the U.S. and non-U.S. jurisdictions. The Company has done a preliminary review of currently enacted legislation. The initial implementation did not have a material impact on the Company’s condensed consolidated financial statements during the three and six months ended June 30, 2024, and it is not currently expected to have a material impact on the Company’s operations, financial condition or cash flows in the future. However, the Company will continue to evaluate the potential impact of Pillar Two on the Company and its results as additional countries adopt legislation and issue individual guidance on their enacted legislation.

Previous wording

Three months ended March 31, 2024 compared to the three months ended March 31, 2023

Current wording

Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023

Previous wording

Net sales were $3,256.3 in the first quarter of 2024 compared to $2,974.0 in the first quarter of 2023, which represented an increase of 9% in U.S. dollars, 10% in constant currencies and 6% organically (excluding both currency and acquisition impacts), compared to the prior year period. The organic increase in net sales in the first quarter of 2024 was driven by strong growth in the Communications Solutions segment, along with moderate growth in the Harsh Environment Solutions segment and Interconnect and Sensor Systems segment, as described below. From an end market standpoint, the increase in net sales in the first quarter of 2024 relative to the prior year period was driven by strong organic growth in the information technology and data communications (“IT datacom”), commercial aerospace, automotive, and defense markets and moderate growth in the mobile devices market, along with contributions from the Company’s acquisition program, partially offset by organic declines in the mobile networks, broadband communications, and industrial markets.

Current wording

Net sales were $3,609.7 in the second quarter of 2024 compared to $3,053.9 in the second quarter of 2023, which represented an increase of 18% in U.S. dollars, 19% in constant currencies and 11% organically (excluding both currency and acquisition impacts), compared to the prior year period. The increase in net sales in the second quarter of 2024 was primarily driven by strong organic growth in the Communications Solutions segment and moderate organic growth in the Interconnect and Sensor Systems segment, along with contributions from the Company’s acquisition program, as described below. From an end market standpoint, the increase in net sales in the second quarter of 2024 relative to the prior year period was driven by strong organic growth in the information technology and data communications (“IT datacom”) and defense markets and moderate growth in the commercial aerospace, mobile devices, mobile networks and automotive markets, along with contributions from the Company’s acquisition program, partially offset by organic declines in the broadband communications and industrial markets.

Previous wording

Net sales in the Harsh Environment Solutions segment (approximately 28% of net sales) in the first quarter of 2024 increased 7% in U.S. dollars, 7% in constant currencies and 3% organically, compared to the first quarter of 2023. The increase in the first quarter of 2024 was primarily driven by strong organic growth in the commercial aerospace, defense, automotive, and IT datacom markets, along with contributions from the Company’s acquisition program, partially offset by organic declines in the industrial and mobile networks markets.

Current wording

Net sales in the Harsh Environment Solutions segment (approximately 29% of net sales) in the second quarter of 2024 increased 18% in U.S. dollars, 18% in constant currencies and 1% organically, compared to the second quarter of 2023. The increase in the second quarter of 2024 was primarily driven by contributions from the Company’s acquisition program, along with strong organic growth in the defense and IT datacom markets and moderate growth in the commercial aerospace market, partially offset by organic declines in the industrial, automotive and mobile networks markets. Net sales in the Harsh Environment Solutions segment (approximately 29% of net sales) in the first six months of 2024 increased 13% in U.S. dollars, 13% in constant currencies and 2% organically, compared to the prior year period. The increase in the first six months of 2024 was primarily driven by contributions from the Company’s

Previous wording

Net sales in the Communications Solutions segment (approximately 39% of net sales) in the first quarter of 2024 increased 12% in U.S. dollars, 13% in constant currencies and 11% organically, compared to the first quarter of 2023. The increase in the first quarter of 2024 was primarily driven by strong organic growth in the IT datacom and automotive markets and moderate growth in the mobile devices market, along with contributions from the Company’s acquisition program, partially offset by organic declines in the broadband communications, mobile networks, and industrial markets.

Current wording

Net sales in the Communications Solutions segment (approximately 40% of net sales) in the second quarter of 2024 increased 24% in U.S. dollars, 25% in constant currencies and 23% organically, compared to the second quarter of 2023. The increase in the second quarter of 2024 was primarily driven by strong organic growth in the IT datacom, automotive, and mobile networks markets and moderate growth in the mobile devices and industrial markets, along with contributions from the Company’s acquisition program, partially offset by an organic decline in the broadband communications market. Net sales in the Communications Solutions segment (approximately 39% of net sales) in the first six months of 2024 increased 18% in U.S. dollars, 19% in constant currencies and 17% organically, compared to the first six months of 2023. The increase in the first six months of 2024 was primarily driven by strong organic growth in the IT datacom and automotive markets and moderate growth in the mobile devices market, along with contributions from the Company’s acquisition program, partially offset by organic declines in the broadband communications, mobile networks, and industrial markets.

Previous wording

Net sales in the Interconnect and Sensor Systems segment (approximately 33% of net sales) in the first quarter of 2024 increased 8% in U.S. dollars, 9% in constant currencies and 2% organically, compared to the first quarter of 2023. The increase in the first quarter of 2024 was primarily driven by strong organic growth in the IT datacom market and moderate growth in the automotive market, along with contributions from the Company’s acquisition program, partially offset by organic declines in the industrial, defense, and mobile networks markets.

Current wording

Net sales in the Interconnect and Sensor Systems segment (approximately 31% of net sales) in the second quarter of 2024 increased 12% in U.S. dollars, 13% in constant currencies and 7% organically, compared to the second quarter of 2023. The increase in the second quarter of 2024 was primarily driven by strong organic growth in the IT datacom market and moderate growth in the automotive market, along with contributions from the Company’s acquisition program, partially offset by organic declines in the industrial, defense and mobile networks markets. Net sales in the Interconnect and Sensor Systems segment (approximately 32% of net sales) in the first six months of 2024 increased 10% in U.S. dollars, 11% in constant currencies and 5% organically, compared to the first six months of 2023. The increase in the first six months of 2024 was primarily driven by contributions from the Company’s acquisition program, along with strong organic growth in the IT datacom market and moderate growth in the automotive market, partially offset by organic declines in the industrial, defense, and mobile networks markets.

Previous wording

The table below reconciles Constant Currency Net Sales Growth and Organic Net Sales Growth to the most directly comparable U.S. GAAP financial measures, by segment, geography and consolidated, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023:

Current wording

The table below reconciles Constant Currency Net Sales Growth and Organic Net Sales Growth to the most directly comparable U.S. GAAP financial measures, by segment, geography and consolidated, for the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023:

Previous wording

The comparatively stronger U.S. dollar for the first quarter of 2024 had the effect of decreasing sales by approximately $17.4, relative to the comparable period in 2023.

Current wording

The comparatively stronger U.S. dollar for the second quarter and first six months of 2024 had the effect of decreasing sales by approximately $26.7 and $44.1, respectively, relative to the comparable periods in 2023.

Previous wording

Selling, general and administrative expenses were $404.2, or 12.4% of net sales for the first quarter of 2024, compared to $346.3, or 11.6% of net sales for the first quarter of 2023. The increase in Selling, general and administrative expenses as a percentage of net sales in the first quarter of 2024 was primarily driven by the effect of acquisitions, which currently have higher selling, general and administrative expenses as a percentage of net sales compared to the Company average. Administrative expenses represented approximately 4.8% of net sales for the first quarter of 2024, and represented approximately 4.7% of net sales for the first quarter of 2023. Research and development expenses represented approximately 3.0% of net sales for the first quarter of 2024, and represented approximately 2.8% of net sales for the first quarter of 2023. Selling and marketing expenses represented approximately 4.6% of net sales for the first quarter of 2024, and represented approximately 4.2% of net sales for the first quarter of 2023.

Current wording

Selling, general and administrative expenses were $444.3, or 12.3% of net sales, and $848.4, or 12.4% of net sales, for the second quarter and first six months of 2024, respectively, compared to $367.8, or 12.0% of net sales, and $714.1, or 11.8% of net sales, for the second quarter and first six months of 2023, respectively. The increases in selling, general and administrative expenses as a percentage of net sales in the second quarter and first six months of 2024 were primarily driven by the effect of acquisitions, which currently have higher selling, general and administrative expenses as a percentage of net sales compared to the Company average. Administrative expenses represented approximately 4.9% of net sales for both the second quarter and first six months of 2024, and represented approximately 4.9% and 4.8% of net sales for the second quarter and first six months of 2023, respectively. Research and development expenses represented approximately 3.0% of net sales for both the second quarter and first six months of 2024, and represented

Previous wording

Operating income was $684.8, or 21.0% of net sales, for the first quarter of 2024, compared to $591.7, or 19.9% of net sales, for the first quarter of 2023. Operating income for the first quarter of 2023 included $5.4 of acquisition-related expenses (presented separately in the Condensed Consolidated Statements of Income), comprised of the amortization related to the value associated with acquired backlog resulting from an acquisition that closed in the first quarter of 2023. For the three months ended March 31, 2023, the acquisition-related expenses had the effect of decreasing net income by $4.0, or $0.01 per share. Excluding the effect of these acquisition-related expenses, Adjusted Operating Income and Adjusted Operating Margin, each as defined in the “Non-GAAP Financial Measures” section below, were $684.8, or 21.0% of net sales, for the three months ended March 31, 2024, and $597.1, or 20.1% of net sales, for the three months ended March 31, 2023. The increase in Adjusted Operating Income and Adjusted Operating Margin for the first quarter

Current wording

Operating income was $698.8, or 19.4% of net sales, and $1,383.7, or 20.2% of net sales, for the second quarter and first six months of 2024, respectively, compared to $619.9, or 20.3% of net sales, and $1,211.6, or 20.1% of net sales, for the second quarter and first six months of 2023, respectively. Operating income for the second quarter and first six months of 2024 includes $70.0 of acquisition-related expenses (presented separately in the Condensed Consolidated Statements of Income), comprised primarily of external transaction costs associated with the 2024 Acquisitions, as well as the amortization related to the value associated with acquired backlog and certain non-cash purchase accounting costs resulting from the Carlisle Interconnect Technologies (“CIT”) acquisition. Operating income for the second quarter of 2023 included $4.0 of acquisition-related expenses (presented separately in the Condensed Consolidated Statements of Income) comprised of external transaction costs related to acquisitions. Operating income for the first six months of 2023 included $9.4 of acquisition-related expenses (presented separately in the Condensed Consolidated Statements of Income) comprised of the amortization related to the value associated with acquired backlog resulting from an acquisition that closed in the first quarter of 2023, as well as the external transaction costs incurred in the second quarter of 2023. For the three and six months ended June 30, 2024, the acquisition-related expenses had the effect of decreasing net income by $59.9 in both periods, while for the three and six months ended June 30, 2023, the acquisition-related expenses had the effect of decreasing net income by $3.8 and $7.8, respectively, as shown in the tables below. Excluding the effect of these acquisition-related expenses, Adjusted Operating Income and Adjusted Operating Margin, each as defined in the “Non-GAAP Financial Measures” section below, were $768.8, or 21.3% of net sales, and $623.9, or 20.4% of net sales, for the three months ended June 30, 2024 and 2023, respectively. Excluding the effect of these acquisition-related expenses, Adjusted Operating Income and Adjusted Operating Margin were $1,453.7, or 21.2% of net sales, and $1,221.0, or 20.3% of net sales, for the six months ended June 30, 2024 and 2023, respectively. The increases in Adjusted Operating Income and Adjusted Operating Margin for both the second quarter and first six months of 2024 relative to the comparable periods in 2023 wasprimarily driven by strong operating performance on the higher sales volumes, partially offset by the negative impact on operating margin related to acquisitions completed within the prior twelve months that are currently operating below the average operating margin of the Company.

Previous wording

Operating income for the Harsh Environment Solutions segment for the first quarter of 2024 was $244.4, or 26.7% of net sales, compared to $226.3, or 26.5% of net sales, for the first quarter of 2023. The increase in operating margin for the Harsh Environment Solutions segment for the first quarter of 2024 relative to the comparable period in 2023 was primarily driven by strong operating performance on the higher sales volumes, partially offset by the negative impact on operating margin related to acquisitions completed within the prior twelve months that are currently operating below the average operating margin of the Company.

Current wording

Operating income for the Harsh Environment Solutions segment for the second quarter and first six months of 2024 was $259.6, or 24.8% of net sales, and $504.1, or 25.7% of net sales, respectively, compared to $240.3, or 27.0% of net sales, and $466.6, or 26.8% of net sales, for the second quarter and first six months of 2023, respectively. The decreases in operating margin for the Harsh Environment Solutions segment for both the second quarter and first six months of 2024 relative to the comparable periods in 2023 were primarily driven by the negative impact on operating margin related to acquisitions completed within the prior twelve months, particularly CIT, that are currently operating below the average operating margin of the Company.

Previous wording

Operating income for the Communications Solutions segment for the first quarter of 2024 was $286.2, or 22.6% of net sales, compared to $230.6, or 20.5% of net sales, for the first quarter of 2023. The increase in operating margin for the Communications Solutions segment for the first quarter of 2024 relative to the comparable period in 2023 was primarily driven by strong operating performance on the higher sales volumes, partially offset by the negative impact on operating margin related to acquisitions completed within the prior twelve months that are currently operating below the average operating margin of the Company.

Current wording

Operating income for the Communications Solutions segment for the second quarter and first six months of 2024 was $350.6, or 24.3% of net sales, and $636.8, or 23.5% of net sales, respectively, compared to $238.5, or 20.5% of net sales, and $469.1, or 20.5% of net sales, for the second quarter and first six months of 2023, respectively. The increases in operating margin for the Communications Solutions segment for both the second quarter and first six months of 2024 relative to the comparable periods in 2023 were primarily driven by strong operating performance on the higher sales volumes.

Previous wording

Operating income for the Interconnect and Sensor Systems segment for the first quarter of 2024 was $195.4, or 18.2% of net sales, compared to $178.8, or 18.0% of net sales, for the first quarter of 2023. The increase in operating margin for the Interconnect and Sensor Systems segment for the first quarter of 2024 relative to the comparable period in 2023 was primarily driven by strong operating performance on the higher sales volumes, partially offset by the negative impact on operating margin related to acquisitions completed within the prior twelve months that are currently operating below the average operating margin of the Company.

Current wording

Operating income for the Interconnect and Sensor Systems segment for the second quarter and first six months of 2024 was $203.3, or 18.2% of net sales, and $398.7, or 18.2% of net sales, respectively, compared to $185.9, or 18.5% of net sales, and $364.7, or 18.3% of net sales, for the second quarter and first six months of 2023, respectively. The decreases in operating margin for the Interconnect and Sensor Systems segment for both the second quarter and first six months of 2024 relative to the comparable periods in 2023 were primarily driven by the negative impact on operating margin related to acquisitions completed within the prior twelve months that are currently operating below the average operating margin of the Company.

Previous wording

Provision for income taxes for the first quarter of 2024 was at an effective tax rate of 16.7%, compared to 20.9%, for the first quarter of 2023. For the first quarter of 2024 and 2023, the excess tax benefits resulting from stock option exercise activity had the impact of decreasing the effective tax rate and increasing earnings per share by the amounts noted in the table below. For the first quarter of 2024, the effective tax rate was further impacted by a discrete tax benefit related to the settlement of tax audits and associated lapses of statutes of limitation, along with a difference in a non-U.S. tax filing position, while for the first quarter of 2023, the effective tax rate was further impacted by the tax effect of acquisition-related expenses, all of which impacted the effective tax rate and earnings per share by the amounts noted in the table below. Excluding the effect of these items, the Adjusted Effective Tax Rate, a non-GAAP financial measure as defined in the “Non-GAAP Financial Measures” section below within this Item 2, for the three months ended March 31, 2024 and 2023 was 24.0%, as reconciled in the table below to the comparable effective tax rate based on GAAP results. Refer to Note 6 of the Notes to Condensed Consolidated Financial Statements for further information related to income taxes.

Current wording

Provision for income taxes for the second quarter and first six months of 2024 was at an effective tax rate of 20.4% and 18.5%, respectively. Provision for income taxes for the second quarter and first six months of 2023 was at an effective tax rate of 21.9% and 21.4%, respectively. For the second quarter and first six months of 2024 and 2023, the excess tax benefits resulting from stock option exercise activity, along with the tax effect of acquisition-related expenses incurred during each period, impacted the effective tax rate and earnings per share by the amounts noted in the tables below. For the first six months of 2024, the effective tax rate was further impacted by a discrete tax benefit related to the settlement of tax audits and associated lapses of statutes of limitation, along with a difference in a non-U.S. tax filing position. For the second quarter and first six months of 2023, the effective tax rate was further impacted bythe gain from the bargain purchase acquisition that closed in the second quarter of 2023, which impacted the effective tax rate and earnings per share by the amounts noted in the tables below. Excluding the effect of these items, the Adjusted Effective Tax Rate, a non-GAAP financial measure as defined in the “Non-GAAP Financial Measures” section below within this Item 2, for both the three and six months ended June 30, 2024 and 2023 was 24.0%, as reconciled in the tables below to the comparable effective tax rate based on GAAP results. Refer to Note 6 of the Notes to Condensed Consolidated Financial Statements for further information related to income taxes.

Previous wording

Net income attributable to Amphenol Corporation and Net income attributable to Amphenol Corporation per common share - Diluted (“Diluted EPS”) were $548.7 and $0.87, respectively, for the first quarter of 2024, compared to $439.2 and $0.71, respectively, for the first quarter of 2023. Excluding the effect of the items listed in the table below, Adjusted Net Income attributable to Amphenol Corporation and Adjusted Diluted EPS, non-GAAP financial measures as defined in the “Non-GAAP Financial Measures” section below within this Item 2, were $500.4 and $0.80, respectively, for the first quarter of 2024, compared to $426.1 and $0.69, respectively, for the first quarter of 2023.

Current wording

Net income attributable to Amphenol Corporation and Net income attributable to Amphenol Corporation per common share - Diluted (“Diluted EPS”) were $524.8 and $0.41, respectively, for the second quarter of 2024, compared to $460.5 and $0.37, respectively, for the second quarter of 2023. Excluding the effect of the items listed in the tables below, Adjusted Net Income attributable to Amphenol Corporation and Adjusted Diluted EPS, non-GAAP financial measures as defined in the “Non-GAAP Financial Measures” section below within this Item 2, were $553.8 and $0.44, respectively, for the second quarter of 2024, compared to $447.0 and $0.36, respectively, for the second quarter of 2023. Net income attributable to Amphenol Corporation and Diluted EPS were $1,073.5 and $0.85, respectively, for the first six months of 2024, compared to $899.7 and $0.73, respectively, for the first six months of 2023. Excluding the effect of the items listed in the tables below, Adjusted Net Income attributable to Amphenol Corporation and Adjusted Diluted EPS were $1,054.2 and $0.84, respectively, for the first six months of 2024, compared to $873.1 and $0.71, respectively, for the first six months of 2023.

Previous wording

The following table reconciles Adjusted Operating Income, Adjusted Operating Margin, Adjusted Net Income attributable to Amphenol Corporation, Adjusted Effective Tax Rate and Adjusted Diluted EPS (each as defined in the

Current wording

The following tables reconcile Adjusted Operating Income, Adjusted Operating Margin, Adjusted Net Income attributable to Amphenol Corporation, Adjusted Effective Tax Rate and Adjusted Diluted EPS (each as defined in the “Non-GAAP Financial Measures” section below) to the most directly comparable U.S. GAAP financial measures for the three and six months ended June 30, 2024 and 2023:

Previous wording

As of March 31, 2024 and December 31, 2023, the Company had cash, cash equivalents and short-term investments of $1,963.5 and $1,660.2, respectively, with the majority of the Company’s cash, cash equivalents and short-term investments on hand located outside of the United States.

Current wording

As of June 30, 2024 and December 31, 2023, the Company had cash, cash equivalents and short-term investments of $1,302.2 and $1,660.2, respectively, with the majority of the Company’s cash, cash equivalents and short-term investments on hand located outside of the United States.

Previous wording

The Company’s primary ongoing cash requirements will be for operating and working capital needs, capital expenditures, product development activities, repurchases of our Common Stock, dividends, debt service, payments associated with the one-time tax on the deemed repatriation of all of the Company’s pre-2018 accumulated unremitted earnings and profits of foreign subsidiaries (“Transition Tax”), which is payable in annual installments until 2025, taxes due upon the repatriation of foreign earnings (which will be payable upon the repatriation of such earnings), funding of pension obligations, and other contractual obligations and commitments included in Item 7 of the 2023 Annual Report. The Company may also use cash to fund all or part of the cost of future acquisitions, as has been the case in recent years with the Company’s various acquisitions. The Company’s debt service requirements primarily consist of principal and interest on the Company’s Senior Notes, and to the extent of any amounts outstanding, the Revolving Credit Facility and Commercial Paper Programs (all as defined below). As of March 31, 2024 and December 31, 2023, the Company had no borrowings outstanding under the Revolving Credit Facility, Term Loan, U.S. Commercial Paper Program and Euro Commercial Paper Program. However, the Company borrowed under the U.S. Commercial Paper Program throughout much of the first quarter of 2024, the proceeds of which were used for general corporate purposes. Although all such borrowings were repaid before the end of the first quarter of 2024, the Company may make additional borrowings under any of its debt instruments in the future. As a result of increases in the federal funds rate by the U.S. Federal Reserve in recent years, the floating interest rates related to our U.S. Commercial Paper Program (as well as our Revolving Credit Facility, to the extent drawn upon in the future) have increased substantially, a trend that could continue through the

Current wording

The Company’s primary ongoing cash requirements will be for operating and working capital needs, capital expenditures, product development activities, repurchases of our Common Stock, dividends, debt service, payments associated with the one-time tax on the deemed repatriation of all of the Company’s pre-2018 accumulated unremitted earnings and profits of foreign subsidiaries (“Transition Tax”), which is payable in annual installments until 2025, taxes due upon the repatriation of foreign earnings (which will be payable upon the repatriation of such earnings), funding of pension obligations, and other contractual obligations and commitments included in Item 7 of the 2023 Annual Report. The Company may also use cash to fund all or part of the cost of future acquisitions, as has been the case in recent years with the Company’s various acquisitions, including the recent acquisition of CIT in May 2024. The Company’s debt service requirements primarily consist of principal and interest on the Company’s Senior Notes, and to the extent of any amounts outstanding, the Revolving Credit Facility and Commercial Paper Programs (all as defined below). As of June 30, 2024 and December 31, 2023, the Company had no borrowings outstanding under the Revolving Credit Facility, U.S. Commercial Paper Program and Euro Commercial Paper Program. However, the Company borrowed under the U.S. Commercial Paper Program throughout much of the first six months of 2024, the proceeds of which were used for general corporate purposes, including, but not limited to, partially funding the recent acquisition of CIT discussed later within this Item 2. Although all such borrowings were repaid before the end of the second quarter of 2024, the Company may make additional borrowings under any of its debt instruments in the future. As a result of increases in the federal funds rate by the U.S. Federal Reserve in recent years, the floating interest rates related to our U.S. Commercial Paper Program (as well as our Revolving Credit Facility, to the extent drawn upon in the future) have increased substantially, a trend that could continue through the remainder of 2024 and potentially beyond. To the extent that interest rates related to this floating rate debt increase further and the Company borrows under any of these floating interest rate instruments in the future, interest expense and interest payments would increase. Although the Company does not expect changes in interest rates to have a material effect on income or cash flows for the remainder of 2024, there can be no assurance that interest rates will not change significantly from current levels.

Previous wording

The Company has previously indicated an intention to repatriate most of its pre-2024 accumulated earnings and has accrued the foreign and U.S. state and local taxes, if applicable, on those earnings, as appropriate. The associated tax payments are due as the repatriations are made. The Company intends to indefinitely reinvest the remaining pre-2024 foreign earnings. As of March 31, 2024, the Company has accrued the foreign and U.S. state and local taxes associated with the foreign earnings that it intends to repatriate. The Company intends to evaluate future earnings for repatriation, and will accrue for those distributions where appropriate, and to indefinitely reinvest all other foreign earnings. In addition, the Transition Tax is being paid, net of applicable tax credits and deductions, in annual installments until 2025, as permitted under the Tax Act.

Current wording

The Company has previously indicated an intention to repatriate most of its pre-2024 accumulated earnings and has accrued the foreign and U.S. state and local taxes, if applicable, on those earnings, as appropriate. The associated tax payments are due as the repatriations are made. The Company intends to indefinitely reinvest the remaining pre-2024 foreign earnings. As of June 30, 2024, the Company has accrued the foreign and U.S. state and local taxes associated with the foreign earnings that it intends to repatriate. The Company intends to evaluate future earnings for repatriation, and will accrue for those distributions where appropriate, and to indefinitely reinvest all other foreign earnings. In addition, the Company will pay the balance of the Transition Tax, net of applicable tax credits and deductions, in 2025, as permitted under the Tax Act.

Previous wording

The following table summarizes the Company’s cash flows from operating, investing and financing activities for the three months ended March 31, 2024 and 2023, as reflected in the Condensed Consolidated Statements of Cash Flow:

Current wording

The following table summarizes the Company’s cash flows from operating, investing and financing activities for the six months ended June 30, 2024 and 2023, as reflected in the Condensed Consolidated Statements of Cash Flow:

Previous wording

The ability to generate cash from operating activities is one of the Company’s fundamental financial strengths. Net cash provided by operating activities (“Operating Cash Flow”) was $599.5 in the first three months of 2024 compared to $532.4 in the first three months of 2023. The increase in Operating Cash Flow for the first three months of 2024 compared to the first three months of 2023 is primarily due to the increase in net income, partially offset by a higher usage of cash related to the change in working capital.

Current wording

The ability to generate cash from operating activities is one of the Company’s fundamental financial strengths. Net cash provided by operating activities (“Operating Cash Flow”) was $1,263.6 in the first six months of 2024 compared to

Previous wording

In the first three months of 2024, the components of working capital as presented on the accompanying Condensed Consolidated Statements of Cash Flow increased $73.9, excluding the impact of acquisitions and foreign currency translation, primarily due to decreases in accounts payable of $69.9 and accrued liabilities, including income taxes, of $52.3, and an increase in prepaid expenses and other current assets of $20.3 and inventories of $15.1, partially offset by a decrease in accounts receivable of $83.7. In the first three months of 2023, the components of working capital as presented on the accompanying Condensed Consolidated Statements of Cash Flow increased $23.8, excluding the impact of acquisitions and foreign currency translation, primarily due to decreases in accounts payable of $147.7 and accrued liabilities, including income taxes, of $119.4, and an increase in prepaid expenses and other current assets of $47.4, partially offset by decreases in accounts receivable of $261.7 and inventories of $29.0.

Current wording

In the first six months of 2024, the components of working capital as presented on the accompanying Condensed Consolidated Statements of Cash Flow increased $69.8, excluding the impact of acquisitions and foreign currency translation, primarily due to increases in accounts receivable of $141.9 and inventories of $23.5, and a decrease in accrued liabilities, including income taxes, of $14.9, partially offset by an increase in accounts payable of $115.5. In the first six months of 2023, the components of working capital as presented on the accompanying Condensed Consolidated Statements of Cash Flow increased $57.7, excluding the impact of acquisitions and foreign currency translation, primarily due to decreases in accounts payable of $203.2 and accrued liabilities, including income taxes, of $156.6, and an increase in prepaid expenses and other current assets of $19.3, partially offset by decreases in accounts receivable of $199.9 and inventories of $121.5.

Previous wording

decreased $14.2 to $2,152.9. Inventory days at March 31, 2024 and December 31, 2023 were 89 days and 85 days, respectively. The increase in inventory days was primarily driven by the lower sales levels in the first quarter of 2024 compared to the fourth quarter of 2023. Prepaid expenses and other current assets increased $34.3 to $423.9, primarily due to increases in certain prepaid expenses and other current receivables. Property, plant and equipment, net, decreased $3.1 to $1,311.6, primarily due to depreciation of $81.4 and Translation, largely offset by capital expenditures of $94.3. Goodwill increased $8.1 to $7,100.5, primarily driven by measurement period adjustments related to acquisitions that closed late in 2023, which were largely offset by Translation. Other intangible assets, net, decreased $49.4 to $785.4, primarily due to measurement period adjustments related to certain intangible assets associated with acquisitions that closed late in 2023, as well as the amortization associated with the Company’s current intangible assets. Other long-term assets increased $34.1 to $483.3, primarily due to an increase in operating lease right-of-use assets resulting from new and renewed lease agreements during the first quarter of 2024. Accounts payable decreased $86.2 to $1,264.7, primarily due to decreased purchasing activity related to the moderately lower sales levels in the first quarter of 2024 relative to the fourth quarter of 2023, along with Translation. Payable days at March 31, 2024 and December 31, 2023 were 53 days and 55 days, respectively. Total accrued expenses, including accrued income taxes, decreased $42.1 to $1,405.9, primarily as a result of decreases in accrued salaries, wages and employee benefits and accrued income taxes.

Current wording

The following describes the significant changes in the amounts as presented on the accompanying Condensed Consolidated Balance Sheets at June 30, 2024 as compared to December 31, 2023. Accounts receivable increased $237.1 to $2,855.5, primarily due to the impact of the two acquisitions (the “2024 Acquisitions”) that closed during the second quarter of 2024, along with the higher sales in the second quarter of 2024 relative to the fourth quarter of 2023, partially offset by the effect of translation from exchange rate changes (“Translation”) at June 30, 2024 compared to December 31, 2023. Days sales outstanding at June 30, 2024 and December 31, 2023 were 69 days and 70 days, respectively. Inventories increased $231.7 to $2,398.8, primarily due to the impact of the 2024 Acquisitions, partially offset by Translation. Inventory days at June 30, 2024 and December 31, 2023 were 84 days and 85 days, respectively. Prepaid expenses and other current assets increased $25.7 to $415.3, primarily due tothe impact of the 2024 Acquisitions. Property, plant and equipment, net, increased $219.3 to $1,534.0, primarily due to capital expenditures of $235.6 andthe impact of the 2024 Acquisitions, partially offset bydepreciation of $162.4 and Translation. Goodwill increased $1,169.4 to $8,261.8, primarily driven bygoodwill recognized associated with the 2024 Acquisitions, in particular the CIT acquisition, partially offset by Translation. Other intangible assets, net, increased $473.9 to $1,308.7, primarily due tothe recognition of certain intangible assets related to the 2024 Acquisitions, partially offset bythe amortization associated with the Company’s current intangible assets as well as measurement period adjustments related to certain intangible assets associated with acquisitions that closed late in 2023. Other long-term assets increased $61.3 to $510.5, primarily due to an increase in operating lease right-of-use assets resulting from new and renewed lease agreements entered into during the first six months of 2024 as well as acquired leases resulting from acquisitions. Accounts payable increased $170.5 to $1,521.4, primarily due toincr eased purchasing activity related to the higher sales levels in the second quarter of 2024 relative to the fourth quarter of 2023, along withthe impact of the 2024 Acquisitions, partially offset by Translation. Payable days at June 30, 2024 and December 31, 2023 were 56 days and 55 days, respectively. Total accrued expenses, including accrued income taxes, increased $82.3 to $1,530.3, primarily as a result ofthe impact of the 2024 Acquisitions and an increase in various other accrued expenses, partially offset by adecrease in accrued income taxes and Translation. Other long-term liabilities, including deferred tax liabilities, increased $83.1 to $903.8, primarily as a result of an increase in deferred tax liabilities resulting from the 2024 Acquisitions.

Previous wording

In addition to Operating Cash Flow, the Company also considers Free Cash Flow, a non-GAAP financial measure defined in the “Non-GAAP Financial Measures” section below, as a key metric in measuring the Company’s ability to generate cash. The following table reconciles Free Cash Flow to its most directly comparable U.S. GAAP financial measure for the three months ended March 31, 2024 and 2023. The increase in Free Cash Flow was driven by an increase in Operating Cash Flow, as described above:

Current wording

In addition to Operating Cash Flow, the Company also considers Free Cash Flow, a non-GAAP financial measure defined in the “Non-GAAP Financial Measures” section below, as a key metric in measuring the Company’s ability to generate cash. The following table reconciles Free Cash Flow to its most directly comparable U.S. GAAP financial

Previous wording

Net cash used in investing activities was $17.0 in the first quarter of 2024, compared to $256.6 in the first quarter of 2023. In the first quarter of 2024, net cash used in investing activities was primarily driven by capital expenditures (net of disposals) of $93.8, partially offset by net sales and maturities of short-term investments of $75.7. In the first quarter of 2023, net cash used in investing activities was primarily driven by the use of $113.2 to fund an acquisition, capital expenditures (net of disposals) of $96.9, and net purchases of short- and long-term investments of $46.7.

Current wording

Net cash used in investing activities was $2,195.7 in the first six months of 2024, compared to $375.1 in the first six months of 2023. In the first six months of 2024, net cash used in investing activities was primarily driven by theuse of $2,099.8 to fund acquisitions and capital expenditures (net of disposals) of $230.2, partially offset by net sales and maturities of short-term investments of $132.4. In the first six months of 2023, net cash used in investing activities was primarily driven by capital expenditures (net of disposals) of $191.5, the use of $113.2 to fund acquisitions, and net purchases of short- and long-term investments of $75.4.

Previous wording

options. In the first quarter of 2023, net cash used in financing activities was primarily driven by (i) net repayments of $387.5 related to the Company’s commercial paper programs, primarily the U.S. Commercial Paper Program, (ii) repurchases of the Company’s Common Stock of $166.9, (iii) dividend payments of $124.9, (iv) distributions to and purchases of noncontrolling interests of $5.2, (v) other debt repayments of $3.1 related to other long-term debt, and (vi) payments of $2.3 related to debt financing costs associated with the March 2023 issuance of the 2026 Senior Notes (defined below), partially offset by (a) net cash proceeds from borrowings of $350.2, primarily related to the issuance of the 2026 Senior Notes, and (b) cash proceeds of $74.3 from the exercise of stock options.

Current wording

Net cash provided by financing activities was $743.4 in the first six months of 2024, compared to net cash used in financing activities of $704.0 in the first six months of 2023. In the first six months of 2024, net cash provided by financing activities was primarily driven by (i)net cash proceeds from borrowings of $1,500.1, primarily related to the issuance of the New Senior Notes (as defined below), and (ii) cash proceeds of $234.7 from the exercise of stock options, partially offset by (a) debt repayments of $351.8, primarily related to the redemption of the 3.20% Senior Notes in the second quarter of 2024, (b) repurchases of the Company’s Common Stock of $344.2, (c) dividend payments of $263.8, (d)distributions to and purchases of noncontrolling interests of $17.5, and (e)payments of $14.7 related to debt financing costs associated with the Company’s amended and restated revolving credit facility in March 2024 as well as the issuances of the New Senior Notes in April 2024, as discussed further below. In the first six months of 2023, net cash used in financing activities was primarily driven by (i) net repayments of $632.6 related to the Company’s commercial paper programs, primarily the U.S. Commercial Paper Program, (ii) repurchases of the Company’s Common Stock of $320.5, (iii) dividend payments of $249.9, (iv) other debt repayments of $7.1 related to other long-term debt, (v) distributions to and purchases of noncontrolling interests of $6.5, and (vi) payments of $2.3 related to debt financing costs associated with the March 2023 issuance of the 2026 Senior Notes (as defined below), partially offset by (a) net cash proceeds from borrowings of $351.8, primarily related to the issuance of the 2026 Senior Notes, and (b) cash proceeds of $163.1 from the exercise of stock options.

Previous wording

On March 21, 2024, the Company entered into a third amended and restated credit agreement, which amended and restated its $2,500.0 unsecured revolving credit facility, increasing the lenders’ aggregate unsecured revolving commitments under the facility by $500.0 to $3,000.0 (the “Revolving Credit Facility”). The Revolving Credit Facility matures in March 2029 and gives the Company and certain of its subsidiaries the ability to borrow, in various currencies, at a spread that varies, based on the Company’s debt rating, over certain currency-specific benchmark rates, which benchmark rates, in the case of U.S. dollar borrowings, are either the base rate or the adjusted term Secured Overnight Financing Rate (“SOFR”). The Revolving Credit Facility was undrawn on the date of the amendment. The Company may utilize the Revolving Credit Facility for general corporate purposes. As of March 31, 2024 and December 31, 2023, there were no outstanding borrowings under the revolving credit facility then in effect. The Revolving Credit Facility requires payment of certain annual agency and commitment fees and requires that the Company satisfy certain financial covenants. On March 31, 2024, the Company was in compliance with the financial covenants under the Revolving Credit Facility.

Current wording

On March 21, 2024, the Company entered into a third amended and restated credit agreement, which amended and restated its $2,500.0 unsecured revolving credit facility, increasing the lenders’ aggregate unsecured revolving commitments under the facility by $500.0 to $3,000.0 (the “Revolving Credit Facility”). The Revolving Credit Facility matures in March 2029 and gives the Company and certain of its subsidiaries the ability to borrow, in various currencies, at a spread that varies, based on the Company’s debt rating, over certain currency-specific benchmark rates, which benchmark rates, in the case of U.S. dollar borrowings, are either the base rate or the adjusted term Secured Overnight Financing Rate (“SOFR”). The Revolving Credit Facility was undrawn on the date it was amended and restated. The Company may utilize the Revolving Credit Facility for general corporate purposes. As of June 30, 2024 and December 31, 2023, there were no outstanding borrowings under the revolving credit facility then in effect. The Revolving Credit Facility requires payment of certain annual agency and commitment fees and requires that the Company satisfy certain financial covenants. On June 30, 2024, the Company was in compliance with the financial covenants under the Revolving Credit Facility.

Previous wording

On April 19, 2022, the Company entered into a two-year, $750.0 unsecured delayed draw term loan credit agreement (the “Term Loan”), which was scheduled to mature on April 19, 2024. The Term Loan was undrawn at closing and was permitted to be drawn on up to five occasions over the life of the facility. The Term Loan could be repaid at any time without premium or penalty, and, once repaid, could not be reborrowed. If drawn upon, the proceeds from the Term Loan were expected to be used for general corporate purposes. Interest rates under the Term Loan were based on a spread over either the base rate or the adjusted term SOFR, which spread varied based on the Company’s debt rating. As of March 31, 2024, the Company had not drawn upon the Term Loan, and, as such, there were no outstanding borrowings under the Term Loan. The Term Loan required payment of certain commitment fees and required that the Company satisfy certain financial covenants. On March 31, 2024, the Company was in compliance with the financial covenants under the Term Loan. The Term Loan matured on April 19, 2024 without the Company drawing upon it throughout its term.

Current wording

On April 19, 2022, the Company entered into a two-year, $750.0 unsecured delayed draw term loan credit agreement (the “Term Loan”). The Term Loan matured on April 19, 2024 without the Company drawing upon it throughout its term.

Previous wording

The Company has a commercial paper program (the “U.S. Commercial Paper Program”) pursuant to which the Company may issue short-term unsecured commercial paper notes (the “USCP Notes” or “U.S. Commercial Paper”) in one or more private placements in the United States. On March 21, 2024, in conjunction with the increase in the capacity of the Revolving Credit Facility, the Company increased the borrowings available under its U.S. Commercial Paper Program by $500.0. As of March 31, 2024, the maximum aggregate principal amount outstanding of USCP Notes at any time is $3,000.0. The Company utilizes borrowings under the U.S. Commercial Paper Program for general corporate purposes, which, in recent years, have included fully or partially funding acquisitions, as well as repaying certain outstanding senior notes. The Company borrowed under the U.S. Commercial Paper Program throughout much of the first quarter of 2024, the proceeds of which were used for general corporate purposes. Before the end of the first quarter of 2024, the Company repaid all of its USCP Notes then outstanding. As of March 31, 2024 and December 31, 2023, there were no USCP Notes outstanding.

Current wording

The Company has a commercial paper program (the “U.S. Commercial Paper Program”) pursuant to which the Company may issue short-term unsecured commercial paper notes (the “USCP Notes” or “U.S. Commercial Paper”) in one or more private placements in the United States. On March 21, 2024, in conjunction with the increase in the capacity of the Revolving Credit Facility, the Company increased the borrowings available under its U.S. Commercial Paper Program by $500.0. As of June 30, 2024, the maximum aggregate principal amount outstanding of USCP Notes at any time is $3,000.0. The Company utilizes borrowings under the U.S. Commercial Paper Program for general corporate purposes, which, in recent years, have included fully or partially funding acquisitions, as well as repaying certain outstanding senior notes. The Company borrowed under the U.S. Commercial Paper Program throughout much of the first six months of 2024, the proceeds of which were used for general corporate purposes, including, but not limited to, partially funding the recent acquisition of CIT. Before the end of the second quarter of 2024, the Company repaid all of its USCP Notes then outstanding. As of June 30, 2024 and December 31, 2023, there were no USCP Notes outstanding.

Previous wording

“Commercial Paper Programs”), pursuant to which the Euro Issuer may issue short-term unsecured commercial paper notes (the “ECP Notes” and, together with the USCP Notes, the “Commercial Paper”), which are guaranteed by the Company and are to be issued outside of the United States. The ECP Notes may be issued in Euros, Sterling, U.S. dollars or other currencies. The maximum aggregate principal amount outstanding of ECP Notes at any time is $2,000.0. The Company utilizes borrowings under the Euro Commercial Paper Program for general corporate purposes, which may include, for example, fully or partially funding acquisitions. The Company did not borrow under the Euro Commercial Paper Program during the first quarter of 2024, and, as of March 31, 2024 and December 31, 2023, there were no ECP Notes outstanding.

Current wording

The Company and one of its wholly owned European subsidiaries (the “Euro Issuer”) also have a commercial paper program (the “Euro Commercial Paper Program” and, together with the U.S. Commercial Paper Program, the “Commercial Paper Programs”), pursuant to which the Euro Issuer may issue short-term unsecured commercial paper notes (the “ECP Notes” and, together with the USCP Notes, the “Commercial Paper”), which are guaranteed by the Company and are to be issued outside of the United States. The ECP Notes may be issued in Euros, Sterling, U.S. dollars or other currencies. The maximum aggregate principal amount outstanding of ECP Notes at any time is $2,000.0. The Company utilizes borrowings under the Euro Commercial Paper Program for general corporate purposes, which may include, for example, fully or partially funding acquisitions. The Company did not borrow under the Euro Commercial Paper Program during the first six months of 2024, and, as of June 30, 2024 and December 31, 2023, there were no ECP Notes outstanding.

Previous wording

Amounts available under the Commercial Paper Programs may be borrowed, repaid and re-borrowed from time to time. In conjunction with the Revolving Credit Facility, as of March 31, 2024, the authorization from the Company’s Board of Directors (the “Board”) limits the maximum aggregate principal amount outstanding of USCP Notes, ECP Notes, and any other commercial paper or similar programs, along with outstanding amounts under the Revolving Credit Facility, at any time to $3,000.0 in the aggregate. The Commercial Paper Programs are rated A-2 by Standard & Poor’s and P-2 by Moody’s and, based on the Board’s authorization described above, are currently backstopped by the Revolving Credit Facility, as amounts undrawn under the Company’s Revolving Credit Facility are available to repay Commercial Paper, if necessary. The Company reviews its optimal mix of short-term and long-term debt regularly and may replace certain amounts of Commercial Paper, short-term debt and current maturities of long-term debt with new issuances of long-term debt in the future.

Current wording

Amounts available under the Commercial Paper Programs may be borrowed, repaid and re-borrowed from time to time. In conjunction with the Revolving Credit Facility, as of June 30, 2024, the authorization from the Board limits the maximum aggregate principal amount outstanding of USCP Notes, ECP Notes, and any other commercial paper or similar programs, along with outstanding amounts under the Revolving Credit Facility, at any time to $3,000.0 in the aggregate. The Commercial Paper Programs are rated A-2 by Standard & Poor’s and P-2 by Moody’s and, based on the Board’s authorization described above, are currently backstopped by the Revolving Credit Facility, as amounts undrawn under the Revolving Credit Facility are available to repay Commercial Paper, if necessary. The Company reviews its optimal mix of short-term and long-term debt regularly and may replace certain amounts of Commercial Paper, short-term debt and current maturities of long-term debt with new issuances of long-term debt in the future.

Previous wording

On April 5, 2024, the Company issued three series of unsecured senior notes (collectively, the “New Senior Notes”): (i) $450.0 aggregate principal amount of unsecured 5.050% Senior Notes due April 5, 2027 at 99.887% of face value (the “2027 Senior Notes”), (ii) $450.0 aggregate principal amount of unsecured 5.050% Senior Notes due April 5, 2029 at 99.900% of face value (the “2029 Senior Notes”) and (iii) $600.0 aggregate principal amount of unsecured 5.250% Senior Notes due April 5, 2034 at 99.900% of face value (the “2034 Senior Notes”). If the Company’s pending acquisition of the Carlisle Interconnect Technologies (“CIT”) business is not consummated on or prior to an agreed upon date or if the Company notifies the trustee that the acquisition will not be pursued at all, under certain circumstances, each series of the New Senior Notes will be subject to a special mandatory redemption, at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest from the date of initial issuance, or the most recent date to which interest has been paid or provided for, whichever is later, to, but not including, the special mandatory redemption date. Absent a special mandatory redemption, the Company intends to use the net proceeds from the New Senior Notes, together with a combination of cash on hand and other debt financing (which could include borrowings under the Company’s Revolving Credit Facility and/or U.S. Commercial Paper Program), to fund the cash consideration for the

Current wording

On April 5, 2024, the Company issued three series of unsecured senior notes (collectively, the “New Senior Notes”): (i) $450.0 aggregate principal amount of unsecured 5.050% Senior Notes due April 5, 2027 at 99.887% of face value (the “2027 Senior Notes”), (ii) $450.0 aggregate principal amount of unsecured 5.050% Senior Notes due April 5, 2029 at 99.900% of face value (the “2029 Senior Notes”) and (iii) $600.0 aggregate principal amount of unsecured 5.250% Senior Notes due April 5, 2034 at 99.900% of face value (the “2034 Senior Notes”). The Company used net proceeds from the New Senior Notes, together with a combination of cash on hand and borrowings under the U.S. Commercial Paper Program, to fund the cash consideration for the CIT acquisition in May 2024, as discussed in further detail in Note 11 of the accompanying Notes to Condensed Consolidated Financial Statements herein, along with the fees and expenses related thereto.

Previous wording

On April 23, 2024, the Board authorized a new stock repurchase program under which the Company may purchase up to $2,000.0 of the Company’s Common Stock during the three-year period ending on the close of business on April 28, 2027 (the “2024 Stock Repurchase Program”). The 2024 Stock Repurchase Program becomes effective on April 29, 2024. Thetiming and amount of any future repurchases will depend on a number of factors, such as the levels of cash generation from operations, the volume of stock options exercised by employees, cash requirements for acquisitions, dividends paid, economic and market conditions and the price of the Common Stock.

Current wording

On April 23, 2024, the Board authorized a new stock repurchase program under which the Company may purchase up to $2,000.0 of its Common Stock during the three-year period ending on the close of business on April 28, 2027 (the “2024 Stock Repurchase Program”). The 2024 Stock Repurchase Program became effective on April 29, 2024. During the three months ended June 30, 2024, the Company repurchased 1.8 million shares of its Common Stock for $118.6 under the 2024 Stock Repurchase Program. All of the repurchased shares under the 2024 Stock Repurchase Program during the three months ended June 30, 2024 have been retired by the Company. From July 1, 2024 to July 23, 2024, the Company repurchased 0.6 million additional shares of its Common Stock for $39.9, and, as of July 24, 2024, the Company has remaining authorization to purchase up to $1,841.6 of its Common Stock under the 2024 Stock Repurchase Program. The timing and amount of any future repurchases will depend on a number of factors, such as the levels of cash generation from operations, the volume of stock options exercised by employees, cash requirements for acquisitions, dividends paid, economic and market conditions and the price of the Common Stock.