Vertiv Holdings Co

Previous wording

•Capacity Expansion: We have invested in capacity expansion to meet current and anticipated additional customer demand. For example, since acquiring E&I in late 2021, we have approximately doubled our manufacturing capacity for switchgear, busbar and integrated solutions by opening new facilities and adding production to existing facilities. Additionally, in 2024, in order to support our thermal management activity, we opened a new manufacturing facility in Pune, India and a new facility in Pelzer, South Carolina to support the production of modular solutions, modular power systems and other infrastructure systems. We anticipate continuing to invest in capacity globally to provide the geographic presence that our customers need, and the ability to rapidly scale and to ensure resiliency.

Current wording

•Capacity Expansion: We have invested in capacity expansion to meet current and anticipated additional customer demand. For example, since late 2021, we have approximately doubled our manufacturing capacity for switchgear, busbar and integrated solutions by opening new facilities and adding production to existing facilities. Additionally, in 2024, in order to support our thermal management activity, we opened a new manufacturing facility in Pune, India and a new facility in Pelzer, South Carolina to support the production of modular solutions, modular power systems and other infrastructure systems. We anticipate continuing to invest in capacity globally to provide the geographic presence that our customers need, and the ability to rapidly scale and to ensure resiliency.

Previous wording

Selling, general and administrative expenses (“SG&A”) were $346.3 in the first quarter of 2025, an increase of $32.3, or 10.3% compared to the first quarter of 2024. The increase in SG&A was primarily driven by increased compensation costs. SG&A as a percentage of sales were 17.0% in the first quarter of 2025 compared with 19.2% in the first quarter of 2024.

Current wording

Selling, general and administrative expenses (“SG&A”) were $395.6 in the second quarter of 2025, an increase of $31.8 compared to the second quarter of 2024. The increase in SG&A was primarily driven by increased compensation costs. SG&A as a percentage of sales were 15.0% in the second quarter of 2025 compared with 18.6% in the second quarter of 2024.

Previous wording

Operating profit (loss) in the first quarter of 2025 was $259.7, an increase of $71.9 compared with the first quarter of 2024. Margin increased primarily due to higher sales volumes, improved price realization, manufacturing and procurement productivity and leveraging our fixed costs.

Current wording

Operating profit (loss) in the second quarter of 2025 was $59.2, an increase of $26.9 compared with the second quarter of 2024. Margin increased primarily due to leveraging our fixed costs and a one-time supplier expense in 2024.

Previous wording

Corporate and other costs include costs associated with our headquarters located in Westerville, Ohio, as well as centralized global functions including Finance, Treasury, Risk Management, Strategy & Marketing, IT, Legal, and global product platform development and offering management. Corporate and other costs were $47.4 and $39.9 in the first quarter of 2025 and 2024, respectively. Total corporate, other, and elimination costs increased $7.5 compared to the first quarter of 2024 primarily due to an increase of certain employee related costs and an increase in the foreign currency loss of $0.6.

Current wording

Corporate and other costs include costs associated with our headquarters located in Westerville, Ohio, as well as centralized global functions including Finance, Treasury, Risk Management, Strategy & Marketing, IT, Legal, Human Resources, and global product platform development and offering management. Total corporate and other costs were $58.7 and $45.1 in the second quarter of 2025 and 2024, respectively. Total corporate and other costs increased $13.6 compared to the second quarter of 2024 primarily due to an increase of certain employee related costs and an increase in the foreign currency loss of $2.1.

Previous wording

Net sales were $2,036.0 in the first quarter of 2025, an increase of $396.9, or 24.2%, compared with $1,639.1 in the first quarter of 2024. The increase in sales was primarily driven by higher sales volumes, partially offset by the negative impacts from foreign currency of $17.4. Product sales increased $373.7, which included the negative impacts from foreign currency of $10.9. Services & spares sales increased $23.2, which included the negative impacts from foreign currency of $6.5.

Current wording

Net sales were $4,674.1 in the first six months of 2025, an increase of $1,082.2, or 30.1%, compared with $3,591.9 in the first six months of 2024. The increase in sales was primarily driven by higher sales volumes including the positive impacts from foreign currency of $3.2. Product sales increased $975.3, which included the positive impacts from foreign currency of $6.8. Services & spares sales increased $106.9, which included negative impacts from foreign currency of $3.6.

Previous wording

Excluding intercompany sales, net sales were $1,185.3 in the Americas, $447.2 in Asia Pacific and $403.5 in Europe, Middle East & Africa. Movements in net sales by segment and offering are each detailed in the Business Segments section below.

Current wording

Excluding intercompany sales, net sales were $2,787.6 in the Americas, $1,007.4 in Asia Pacific and $879.1 in Europe, Middle East & Africa. Movements in net sales by segment and offering are each detailed in the Business Segments section below.

Previous wording

Cost of sales were $1,349.5 in the first quarter of 2025, an increase of $276.8, or 25.8% compared to the first quarter of 2024. The increase in cost of sales was primarily driven by the impact of higher volumes. Gross profit was $686.5 in the first quarter of 2025, or 33.7% of sales, compared to $566.4, or 34.6% of sales in the first quarter of 2024. Margin is slightly down in the first quarter of 2025 due primarily to the mix of product and service sales in addition to tariffs.

Current wording

Cost of sales were $3,091.0 in the first six months of 2025, an increase of $806.7, or 35.3% compared to the first six months of 2024. The increase in cost of sales was primarily driven by the impact of higher volumes. Gross profit was $1,583.1 in the six months of 2025, or 33.9% of sales, compared to $1,307.6, or 36.4% of sales in the second quarter of 2024. Margin was slightly down in the first six months of 2025 due primarily to the mix of product and service sales in addition to tariffs.

Previous wording

The remaining other operating expenses includes amortization of intangibles, restructuring costs, foreign currency (gain) loss, and other operating expense (income). These remaining operating expenses were $49.5 for the first quarter of 2025, which was a $0.3 decrease from the first quarter of 2024. The decrease was primarily due to a $0.8 increase in restructuring costs offset by a $0.6 decrease in foreign currency loss and a $0.5 decrease in other operating expense (income) primarily due to the mark-to-market losses associated with the economic hedges.

Current wording

The remaining other operating expenses includes amortization of intangibles, restructuring costs, foreign currency (gain) loss, and other operating expense (income). These remaining operating expenses were $108.1 for the first six months of 2025, which was a $16.9 increase from the first six months of 2024. The increase was primarily due to a $9.1 decrease in other operating expense (income) primarily due to the mark-to-market losses associated with the economic hedges, a $5.2 increase in restructuring costs, and a $1.5 increase in foreign currency loss.

Previous wording

Change in fair value of warrant liabilities represents the mark-to-market fair value adjustments to the then outstanding private warrants. The change in fair value of the outstanding private warrants during the first three months of 2024 resulted in a loss of $176.6. The change in fair value of these warrants was the result of changes in market prices of our common stock, and other observable inputs deriving the value of the financial instruments. On December 6, 2024, Cote SPAC I LLC elected to exercise the remaining 5,266,667 outstanding private warrants on a cashless basis pursuant to the agreement governing the warrants, in exchange for which the Company issued 4,812,521 shares of Class A common stock. As of March 31, 2025, there were no private warrants outstanding.

Current wording

Change in fair value of warrant liabilities represents the mark-to-market fair value adjustments to the then outstanding private warrants. The change in fair value of the outstanding private warrants during the first six months of 2024 resulted in a loss of $202.0. The change in fair value of these warrants was the result of changes in market prices of our common stock, and other observable inputs deriving the value of the financial instruments. On December 6, 2024, Cote SPAC I LLC elected to exercise the remaining 5,266,667 outstanding private warrants on a cashless basis pursuant to the agreement governing the warrants, in exchange for which the Company issued 4,812,521 shares of Class A common stock. As of June 30, 2025, there were no private warrants outstanding.

Previous wording

Interest expense, net, was $25.3 in the first quarter of 2025 compared to$39.0 in the first quarter of 2024. The $13.7 decrease is primarily driven by $9.5 of reduced interest expense as a result of our Term Loan amendments which resulted in a reduction to our interest rate margin and a $3.4 increase in interest income. To the extent interest rates continue to fluctuate our interest expense will change, although we expect these changes to be mitigated by our interest rate swaps and interest income.

Current wording

Interest expense, net, was $46.6 in the first six months of 2025 compared to $83.8 in the first six months of 2024. The $37.2 decrease is primarily driven by $18.7 of reduced interest expense as a result of our Term Loan amendments, which resulted in a reduction to our interest rate margin, and a $11.2 increase in interest income. To the extent interest rates continue to fluctuate our interest expense will change, although we expect these changes to be mitigated by our interest rate swaps and interest income.

Previous wording

Income tax expense was $100.9 in the first quarter of 2025 compared to $(7.1) in the first quarter of 2024. The $108.0 increase is primarily due to increased business performance and the change in the discrete tax expense due to legislative changes effective in the first quarter of 2025. The effective rate in the first quarter of 2025 was primarily influenced by the negative impact of a valuation allowance established to account for legislative changes effective in the first quarter of 2025 partially offset by favorable impact of other discrete items such as stock compensation and changes in deferred tax liabilities. For the first quarter of 2024, income tax expense was primarily influenced by the negative impact of non-deductible changes in fair value of the warrant liabilities, discrete tax benefits related to stock compensation and the mix of income between our U.S. and non-U.S. operations.

Current wording

Income tax expense was $197.8 in the first six months of 2025 compared to $79.5 in the first six months of 2024. The $118.3 increase is primarily due to increased business performance, the change in the discrete tax expense due to legislative changes effective in the first quarter of 2025 and changes related to stock compensation activity. The effective rate in the first six months of 2025 was primarily influenced by the negative impact of a valuation allowance established to account for legislative changes effective in the first quarter of 2025 partially offset by favorable impact of other discrete items such as stock compensation and changes in deferred tax liabilities. For the first six months of 2024, income tax expense was primarily influenced by the negative impact of non-deductible changes in fair value of the warrant liabilities and discrete tax benefits related to stock compensation.

Previous wording

Americas net sales were $1,185.3 in the first quarter of 2025, an increase of $260.3, or 28.1%, from the first quarter of 2024. The increase in sales was primarily driven by higher sales volumes due to products increasing by $242.2 and service & spares increasing by $18.1. Americas net sales were negatively impacted by foreign currency of approximately $5.8.

Current wording

Americas net sales were $2,787.6 in the first six months of 2025, an increase of $741.5, or 36.2%, from the first six months of 2024. The increase in sales was primarily driven by higher sales volumes due to products increasing by $670.9 and sales of service & spares increasing by $70.6. Americas net sales were negatively impacted by foreign currency of approximately $9.3.

Previous wording

Asia Pacific net sales were $447.2 in the first quarter of 2025, an increase of $114.9, or 34.6%, from the first quarter of 2024. The increase in sales were primarily driven by growth across the whole region, partially offset by the negative impact of foreign currency of approximately $6.0. Net sales of products improved by $109.8, and service & spares improved by $5.1.

Current wording

Asia Pacific net sales were $1,007.4 in the first six months of 2025, an increase of $266.0, or 35.9%, from the first six months of 2024. The increase in sales were primarily driven by growth across the whole region, partially offset by the negative impact of foreign currency of approximately $5.4. Net sales of products improved by $240.7, and service & spares improved by $25.3.

Previous wording

Europe, Middle East & Africa net sales of $403.5 in the first quarter of 2025, increased by $21.7, or 5.7%, from the first quarter of 2024. Sales increases were primarily due to increased volumes due to products increasing by $21.7, partially offset by the negative impact of foreign currency of approximately $5.6. Sales of services & spares remained flat compared to the first quarter of 2024.

Current wording

Europe, Middle East & Africa net sales of $879.1 in the first six months of 2025, increased by $74.7, or 9.3%, from the first six months of 2024. Sales increases were primarily due to increased volumes due to products increasing by $63.7, services & spares increased by $11.0 compared to the first six months of 2024. Europe, Middle East & Africa new sales were positively impacted by foreign currency of approximately $17.9.

Previous wording

Our primary future cash needs relate to working capital, operating activities, capital spending, strategic investments and debt service.

Current wording

Our primary future cash needs relate to working capital, operating activities, capital spending, strategic investments (including the Acquisition) and debt service.

Previous wording

Capital Expenditures: Our capital expenditures are primarily related to the maintenance of our long-term assets, as well as the investment in projects, such as capacity and facility expansion, that support growth and innovation to further our enterprise strategy. Our capital expenditures (including capitalized software) were approximately $38.8 during the first three months of 2025. We expect to have capital expenditures (including capitalized software) of $250.0 to $300.0 for the full year 2025.

Current wording

Capital Expenditures: Our capital expenditures are primarily related to the maintenance of our long-term assets, as well as the investment in projects, such as capacity and facility expansion, that support growth and innovation to further our enterprise strategy. Our capital expenditures (including capitalized software) were approximately $84.7 during the first six months of 2025. We expect to have capital expenditures (including capitalized software) of $250.0 to $300.0 for the full year 2025.

Previous wording

We have additional obligations as part of our ordinary course of business, beyond those committed for capital expenditures, which consist of debt obligations and other financial instruments. Refer below, as well as to “Note 5 — Debt” and “Note 12 — Commitments and Contingencies” of the Unaudited Condensed Consolidated Financial Statements for more information. In addition, we have uncertain tax positions that are further discussed in “Note 6 — Income Taxes” of the Unaudited Condensed Consolidated Financial Statements. We anticipate payments for lease obligations of approximately $63.0 for the full year 2025. We do not have any guarantees or other off-balance sheet financing arrangements, including variable interest entities, which could materially impact our financial condition or liquidity.

Current wording

We have additional obligations as part of our ordinary course of business, beyond those committed for capital expenditures, which consist of debt obligations and other financial instruments. Refer below, as well as to “Note 5 — Debt” and “Note 12 — Commitments and Contingencies” of the Unaudited Condensed Consolidated Financial Statements for more information. In addition, we have uncertain tax positions that are further discussed in “Note 6 — Income Taxes” of the Unaudited Condensed Consolidated Financial Statements. We anticipate payments for lease obligations of approximately $75.0 for the full year 2025. We do not have any guarantees or other off-balance sheet financing arrangements, including variable interest entities, which could materially impact our financial condition or liquidity.

Previous wording

We, through our subsidiaries, are party to certain indebtedness arrangements, including the Senior Secured Notes, due 2028, with an outstanding principal amount of $850.0 as of March 31, 2025 (the “Notes”), the Term Loan, due 2027, with an outstanding principal amount of $2,091.7 as of March 31, 2025 (the “Term Loan”), and the ABL Revolving Credit Facility, due 2029, providing up to $800.0 of revolving borrowings, with separate sublimits for letters of credit and swingline borrowings and an uncommitted accordion of up to $200.0, for which none was outstanding as of March 31, 2025 (the “ABL Revolving Credit Facility” and collectively with the Term Loan, the “Senior Secured Credit Facilities”).

Current wording

We, through our subsidiaries, are party to certain indebtedness arrangements, including the Senior Secured Notes due 2028, with an outstanding principal amount of $850.0 as of June 30, 2025 (the “Notes”), the Term Loan due 2027, with an outstanding principal amount of $2,086.5 as of June 30, 2025 (the “Term Loan”), and the ABL Revolving Credit Facility, due 2029, providing up to $800.0 of revolving borrowings, with separate sublimits for letters of credit and swingline borrowings and an uncommitted accordion of up to $200.0, for which none was outstanding as of June 30, 2025 (the “ABL Revolving Credit Facility” and collectively with the Term Loan, the “Senior Secured Credit Facilities”).

Previous wording

At March 31, 2025, we had $1,467.3 in cash and cash equivalents, which includes amounts held outside of the U.S., primarily in Europe and Asia. Non-U.S. cash is generally available for repatriation without legal restrictions, subject to certain taxes, mainly withholding taxes. We are not asserting indefinite reinvestment of cash or outside basis for our non-U.S. subsidiaries due to the outstanding debt obligations in instances where alternative repatriation options, other than dividends, are not available. At March 31, 2025, Vertiv had $784.2 of availability (subject to customary borrowing base and other conditions) under the ABL Revolving Credit Facility, net of letters of credit outstanding in the aggregate principal amount of $15.8, and taking into account the borrowing base limitations set forth in the ABL Revolving Credit Facility.

Current wording

At June 30, 2025, we had $1,640.8 in cash and cash equivalents and $98.2 in short-term investments, which includes amounts held outside of the U.S., primarily in Europe and Asia. Non-U.S. cash is generally available for repatriation without legal restrictions, subject to certain taxes, mainly withholding taxes. We are not asserting indefinite reinvestment of cash or outside basis for our non-U.S. subsidiaries due to the outstanding debt obligations in instances where alternative repatriation options, other than dividends, are not available. At June 30, 2025, Vertiv had $783.0 of availability (subject to customary borrowing base and other conditions) under the ABL Revolving Credit Facility, net of letters of credit outstanding in the aggregate principal amount of $17.0, and taking into account the borrowing base limitations set forth in the ABL Revolving Credit Facility.

Previous wording

We believe our current cash and cash equivalent levels, augmented by availability under the ABL Revolving Credit Facility, will provide adequate near-term liquidity for the next 12 months of independent operations, as well as the resources necessary to invest for growth in existing businesses and manage our capital structure on a short- and long-term basis. We expect to continue to opportunistically access the capital and financing markets from time to time. Access to capital and the availability of financing on acceptable terms in the future will be affected by many factors, including our credit rating, economic conditions, and the overall liquidity of capital markets. There can be no assurance that we will continue to have access to the capital and financing markets on acceptable terms.

Current wording

We believe our current cash, cash equivalent, and short-term investment levels, augmented by availability under the ABL Revolving Credit Facility, will provide adequate near-term liquidity for the next 12 months of independent operations, as well as the resources necessary to fund the Acquisition (if consummated), invest for growth in existing businesses, and manage our capital structure on a short- and long-term basis. We expect to continue to opportunistically access the capital and financing markets from time to time. Access to capital and the availability of financing on acceptable terms in the future will be affected by many factors, including our credit rating, economic conditions, and the overall liquidity of capital markets. There can be no assurance that we will continue to have access to the capital and financing markets on acceptable terms.

Previous wording

Net cash provided by operating activities was $303.3 in the first three months of 2025, a $165.8 increase in cash generation compared to the first three months of 2024. Net income from operations of $164.5 included $118.3 of net non-cash expense items, consisting of depreciation and amortization of $71.6, non-cash stock-based compensation expense of $11.2, amortization of debt discount and issuance costs of $2.2, and deferred taxes of $33.3. Trade working capital utilized $4.8 in the first three months of 2025 compared to $99.7 utilized in the first three months of 2024.

Current wording

Net cash provided by operating activities was $626.2 in the first six months of 2025, a $107.2 increase in cash generation compared to the first six months of 2024. Net income from operations of $488.7 included $196.8 of net non-cash expense items, consisting of depreciation and amortization of $144.9, non-cash stock-based compensation expense of $24.5, amortization of debt discount and issuance costs of $4.3, and deferred taxes of $23.1. Trade working capital utilized $95.2 in the first six months of 2025 compared to $3.6 utilized in the first six months of 2024.

Previous wording

Net cash used for investing activities was $38.8 in the first three months of 2025 compared to net cash used for investing activities of $36.5 in the first three months of 2024. The increased use of cash over the comparable period was primarily driven by an increase in investments of capitalized software of $1.6 and capital expenditures of $0.7.

Current wording

Net cash used for investing activities was $182.8 in the first six months of 2025 compared to net cash used for investing activities of $81.5 in the first six months of 2024. The increased use of cash over the comparable period was primarily driven by purchases of short-term investments of $98.1.

Previous wording

Net cash used for financing activities was $24.9 in the first three months of 2025 compared to $603.1 used for financing activities in the first three months of 2024. The decrease in cash used in 2025 was primarily the result of a $599.9 decrease in repurchase of common shares, offset by a $13.1 decrease in exercise of employee stock options, a $4.9 increase in dividend payment and a $3.7 increase in employee taxes paid for shares withheld.

Current wording

Net cash used for financing activities was $32.9 in the first six months of 2025 compared to $626.7 used for financing activities in the first six months of 2024. The decrease in cash used in 2025 was primarily the result of a $599.9 decrease in repurchases of common shares, offset by a $14.1 decrease in employee taxes paid for shares withheld, a $10.6 decrease in exercise of employee stock options, and a $9.7 increase in dividend payments.