ESAB Corp
For the period ended Apr 3, 2026. Filed May 7, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Apr 3, 2026 · Filed May 7, 2026
ESAB$82.83+4.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-10-03; filed 2025-10-29.
0001877322-25-000152
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-04-03; filed 2026-05-07.
0001877322-26-000033
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 129 previous paragraphs and 122 current paragraphs.
72 unchanged; 37 reworded; 13 added; 19 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 8 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (13)
Current report
ESAB operates a diversified global supply chain and sources parts and materials globally. In February 2026, the United States Supreme Court (the “Court”) ruled that the International Emergency Economic Powers Act (“IEEPA”), which the United States administration (the “administration”) relied on to impose certain tariffs, does not authorize the administration to impose tariffs. On March 4, 2026, the United States Court of International Trade ordered the United States Customs and Border Protection (“CBP”) to process refunds of the IEEPA tariffs, although the Court immediately suspended the order while the CBP determines a refund process. The IEEPA tariffs remain subject to ongoing litigation between the administration and other parties. In response to the Court ruling mentioned above, the administration announced plans to implement new tariffs under alternative statutory authority. The full impact of the Court’s ruling and the administration’s response remains uncertain. In addition, the process for addressing requests for refunds of the IEEPA tariffs has recently begun, and the actual timing and extent of any such refunds remain uncertain at this time. Accordingly, we have not recorded any anticipated recovery of IEEPA tariffs paid as of April 3, 2026. We continue to actively monitor and evaluate these developments and the potential impacts of trade policy and tariffs on our business, supply chain and results of operations. We maintain operations worldwide, including in the jurisdictions impacted by the announced and contemplated tariffs. Refer to Part I. Item 1.A. “Risk Factors” in our 2025 Form 10-K for additional information. The full impact of the matters noted above on the Company, our customers and suppliers, the overall economy and capital markets remains uncertain.
Current report
The Middle East Conflict
Current report
The conflict in the Middle East and the related impacts, such as logistics challenges from the closing of the Strait of Hormuz, have increased the level of economic and political uncertainty. As reflected in the discussions that follow, these logistics challenges have had a variety of impacts on our results of operations during the three months ended April 3, 2026, including decreased sales levels and increased inventory costs. Refer to Part I. Item 1.A. “Risk Factors”section of the 2025 Form 10-K for additional information.
Current report
(2)Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines.
Current report
(1) Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines.
Current report
Gross profit increased $19.9 million in the three months ended April 3, 2026 compared to the prior year period primarily attributable to acquisitions and foreign exchange partially offset by tariff-related cost increases, net of customer pricing, product mix and a decrease in sales volume. The decline of gross profit margin was primarily due to the dilutive effect in the Americas segment caused by tariff-related price pass-through to customers as well as higher freight and material costs due to oil price increases from the war in Iran. Selling, general and administrative expense increased $33.6 million in the three months ended April 3, 2026 compared to the prior year period primarily due to acquisitions and related transaction costs and foreign exchange impact. Interest expense and other, net increased by $8.8 million due to $4.8 million of costs associated with the Bridge Loan that the Company entered into to fund the Eddyfi acquisition as well as a higher average outstanding debt balance. The effective tax rate of 20.2% for the three months ended April 3, 2026 differed from the effective tax rate of 22.0% for the same period ended April 4, 2025 due to favorable provisions related to FDDEI under the One Big Beautiful Bill Act that were effective beginning with the 2026 tax year.
Current report
Net income from continuing operations decreased $20.8 million in the three months ended April 3, 2026 compared to the prior year period primarily due to the aforementioned factors as well as higher Restructuring and other related charges primarily driven by strategic initiatives to improve margins in the Americas and the integration of the recent EWM acquisition and higher Acquisition-amortization and other related charges related to the recent acquisition and integration activity. Adjusted EBITDA increased $2.7 million in the three months ended April 3, 2026 compared to the prior year period primarily due to the aforementioned. Core adjusted EBITDA increased by $8.0 million compared to the same period in the prior year primarily due to the aforementioned factors. Adjusted EBITDA attributable to Russia decreased by $5.3 million largely due to relocating the Russia manufacturing plant from an owned property to a leased property and expenses associated with this relocation project as well as shifting of product mix from higher to lower margin products in response to shifts in demand and decreases in customer pricing while material costs continue to increase. The decline of Core adjusted EBITDA margin was primarily due to dilution from the EWM acquisition as well as higher freight and material costs due to oil price increases from the war in Iran.
Current report
Net sales in our EMEA & APAC segment increased $59.8 million in the three months ended April 3, 2026 compared with the prior year period. Net sales from existing business decreased $10.5 million primarily resulting from volume decreases from logistics challenges in the Middle East related to the war in Iran and lower volumes in Russia. This decrease was more than offset by $42.8 million of Net sales from the Bavaria, DeltaP, Aktiv and EWM acquisitions and $27.5 million in favorable foreign currency impact. Gross profit increased $18.5 million in the three months ended April 3, 2026 compared with the prior year period due to acquisitions and favorable foreign exchange impact partially offset by lower volumes and higher material costs. The decline of gross profit margin was primarily attributable to higher freight and material costs due to oil price increases from the war in Iran as well as plant relocation costs and an unfavorable product mix in Russia in 2026. Selling, general and administrative expense increased $31.3 million in the three months ended April 3, 2026 compared with the prior year period primarily due to acquisitions and related costs and foreign exchange impact. Acquisition - amortization and other related charges increased $11.1 million in thethree months ended April 3, 2026 compared with the prior year period primarily driven by the EWM acquisition. Adjusted EBITDA increased $1.2 million and Core adjusted EBITDA increased $6.5 million in the three months ended April 3, 2026 compared with the prior year period primarily due to the aforementioned factors. The decline of Core adjusted EBITDA margin was primarily due to dilution from the EWM acquisition as well as higher freight and material costs due to oil price increases from the war in Iran.
Current report
In connection with the pending Eddyfi acquisition, the Company has committed equity financing of approximately $318 million, consisting of the issuance of the Mandatory Convertible Preferred Stock for an aggregate liquidation preference of approximately $175 million and the concurrent issuance of common stock to institutional investors at a purchase price of approximately $143 million, both of which are expected to close concurrently with the Acquisition. Refer to Note 3, “Acquisitions” for additional information.
Current report
•Operating cash flow for the three months ended April 3, 2026 increased compared to the same period in the prior year primarily due to favorable working capital movements and higher non-cash expenses related to depreciation and amortization partially offset by the decline in net income.
Current report
•Restructuring initiative payments were $9.1 million and $3.3 million for the three months ended April 3, 2026 and April 4, 2025, respectively. Refer to Note 8, “Accrued and Other liabilities” in the accompanying Notes contained elsewhere in this Form 10-Q for additional information.
Current report
Cash flows used in investing activities during the three months ended April 3, 2026 and April 4, 2025 are primarily comprised of purchases of property, plant and equipment.
Current report
Cash flows provided by financing activities during the three months ended April 3, 2026 are primarily comprised of the proceeds from borrowings on the 2031 Senior Notes partially offset by net repayments of borrowings on the revolving facilities and debt issuance costs.
Removed paragraphs (19)
Previous report
We are actively monitoring and evaluating these developments and the potential impacts of trade policy and tariffs on our business, supply chain and results of operations. We maintain operations worldwide, including in the jurisdictions impacted by the recently announced and contemplated tariffs. If tariffs continue to be maintained at current levels, and/or the United States government or foreign governments impose further retaliatory tariffs or other trade restrictive measures in response, then in addition to the efforts reflected in the discussion that follows, we expect that such actions could negatively impact our revenue growth and margins in future periods through increased supply chain costs, decreased demand and other adverse economic impacts. The net effect of these actions on our company will depend on our ability to successfully mitigate and offset their impact, which efforts may not be effective. If we are unable to mitigate these risks through supply chain adjustments, pricing strategies or other measures, our business could be negatively affected and produce additional impacts. Please refer to Part I. Item 1.A. “Risk Factors” in our 2024 Form 10-K and in Part II. Item 1A in our 2025 Q1 Form 10-Q for additional information. The full impact of the matters noted above on the Company, our customers and suppliers, the overall economy and capital markets remains uncertain.
Previous report
Seasonality
Previous report
Our European operations typically experience a slowdown during the July and August vacation seasons.
Previous report
(2)Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines.
Previous report
(2)Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines.
Previous report
Net sales from existing businesses increased by $11.0 million during the three months ended October 3, 2025, compared to the prior year period, driven by increases in both price and volume. Additionally, there was an increase in net sales from acquisitions attributable to SUMIG Soluções para Solda e Corte Ltda. (“SUMIG”), Bavaria Schweisstechnik (“Bavaria”), DeltaP s.r.l. (“DeltaP”), Aktiv Technologies Private Limited (“Aktiv”) and EWM GmbH (“EWM”). The changes in foreign exchange rates resulted in a $9.8 million favorable currency translation impact.
Previous report
Core sales from existing businesses increased by $12.1 million during the three months ended October 3, 2025, compared to the prior year period, driven by increases in both price and volume. The increase in net sales from acquisitions was attributable to SUMIG, Bavaria, DeltaP, Aktiv and EWM. The changes in foreign exchange rates resulted in a $5.9 million favorable currency translation impact.
Previous report
equipment, lease termination, impairment of long-lived assets and other costs in connection with the closure of and optimization of facilities and product lines.
Previous report
Gross profit increased by $15.5 million in the third quarter of 2025 compared to the prior year period primarily attributable to acquisitions, favorable foreign exchange and price increases partially offset by higher material costs. The decline of gross profit margin was primarily due to the dilutive effect in the Americas segment, which was caused by customer pricing in response to tariff-related cost increases, leading to margin compression. Selling, general and administrative expense increased by $12.4 million in the third quarter of 2025 compared to the prior year period primarily due to acquisitions and related transaction costs partially offset by benefits from EBX driven savings. The effective tax rate of 21.3% for the quarter ended
Previous report
October 3, 2025 differed from the effective tax rate of 20.3% for the same period ended September 27, 2024 due to an agreement with a taxing authority on the treatment of subsidy income in a foreign jurisdiction in 2024.
Previous report
Net income from continuing operations decreased $5.7 million primarily due to higher Interest expense and other, net mainly driven by a higher Debt balance related to acquisitions. For additional information on the Interest expense and other, net impact, refer to Note 10, “Debt” and Note 11, “Derivatives” in the accompanying Notes contained elsewhere in this Form 10-Q. Adjusted EBITDA increased $12.1 million and related margin expanded 30 basis points compared to the same period in the prior year. Core adjusted EBITDA increased $8.6 million compared to the same period in the prior year.
Previous report
Gross profit increased $11.4 million in the nine months ended October 3, 2025 compared to the prior year period primarily attributable to acquisitions, favorable foreign exchange and price increases partially offset by higher material costs, including tariffs, product mix and a decrease in sales volume. The decline of gross profit margin was primarily due to the dilutive effect in the Americas segment, which was caused by customer pricing in response to tariff-related cost increases, leading to margin compression. Selling, general and administrative expense increased $20.3 million in the nine months ended October 3, 2025 compared to the prior year period primarily due to acquisitions and related transaction costs partially offset by benefits from EBX driven savings and restructuring initiatives. The effective tax rate of 21.4% for the nine months ended October 3, 2025 differed from the effective tax rate of 19.9% for the same period ending September 27, 2024 due to discrete tax adjustments in 2024 for a favorable final ruling in a tax case in a foreign jurisdiction and an agreement with a taxing authority on the treatment of subsidy income in a foreign jurisdiction.
Previous report
Net income from continuing operations decreased $11.8 million in the nine months ended October 3, 2025 compared to the prior year period primarily due to the aforementioned factors as well as higher Interest expense and other, net largely driven by a higher Debt balance related to acquisitions partially offset by the $12.2 million non-cash pension settlement loss in 2024. For additional information on the Interest expense and other, net impact, refer to Note 10, “Debt” and Note 11, “Derivatives” in the accompanying Notes contained elsewhere in this Form 10-Q. Adjusted EBITDA increased $19.4 million and Adjusted EBITDA margin expanded by 50 basis points in the nine months ended October 3, 2025 compared to the prior year period. Core adjusted EBITDA increased by $17.7 million compared to the same period in the prior year.
Previous report
Net sales in our Americas segment increased $3.9 million in the third quarter of 2025 compared with the prior year period. Net sales from existing business increased $0.4 million primarily due to pricing increases and new product initiatives partially offset by slightly lower sales volumes. The acquisition of SUMIG contributed a $7.4 million increase to Net sales from acquisitions. In addition, there was $3.9 million of unfavorable currency translation. Gross profit decreased by $2.2 million attributable to higher material costs, including tariffs, and product mix partially offset by price increases and accretion from acquisitions. The decline of gross profit margin was primarily due to the dilutive effect in the Americas segment, which was caused by customer pricing in response to tariff-related cost increases, leading to margin compression. Selling, general and administrative expense remained relatively consistent compared with the prior year. Adjusted EBITDA decreased $2.1 million primarily due to the aforementioned factors.
Previous report
Net sales in our EMEA & APAC segment increased $50.7 million in the third quarter of 2025 compared with the prior year period. Net sales from existing business increased $10.6 million primarily resulting from increases in sales volume. Furthermore, the Bavaria, DeltaP, Aktiv and EWM acquisitions contributed $26.4 million to Net sales from acquisitions and there was a $13.7 million favorable foreign currency impact. Gross profit increased by $17.7 million in the third quarter of 2025 compared with the prior year period primarily due to acquisitions, increased sales volumes and foreign currency translation impacts partially offset by pricing decreases. Selling, general and administrative expense increased $11.2 million in the third quarter of 2025 compared with the prior year period largely due to acquisitions and related transaction costs. Adjusted EBITDA increased $14.1 million and related margin expanded by 120 basis points and Core adjusted EBITDA increased to $76.1 million and the related margin expanded by 40 basis points in the third quarter of 2025 compared with the prior year period primarily because of the aforementioned factors.
Previous report
Net sales in our EMEA & APAC segment increased $90.0 million in the nine months ended October 3, 2025 compared with the prior year period. Net sales from existing business increased $23.3 million primarily resulting from increases in sales volume. Furthermore, the ESAB Bangladesh, Bavaria, DeltaP, Aktiv and EWM acquisitions contributed $44.3 million to Net sales from acquisitions and there was a $22.4 million in favorable foreign currency impact. Gross profit increased $26.4 million in the nine months ended October 3, 2025 compared with the prior year period due to acquisitions, favorable foreign exchange impact and increased sales volumes partially offset by lower pricing. Selling, general and administrative expense increased $16.9 million in the nine months ended October 3, 2025 compared with the prior year period primarily due to acquisitions and related costs partially offset by a gain on disposition of property. Adjusted EBITDA increased $29.0 million and Adjusted EBITDA margin expanded 90 basis points and Core adjusted EBITDA increased to $231.2 million and Core adjusted EBITDA margin expanded 80 basis points in the nine months ended October 3, 2025 compared with the prior year period primarily because of the aforementioned factors.
Previous report
•Operating cash flow for the nine months ended October 3, 2025 decreased compared to the prior year period due to higher purchases of inventory in advance of tariff, higher interest expenses and transaction costs associated with acquisition activity.
Previous report
•Restructuring initiative payments were $8.8 million and $8.3 million for the nine months ended October 3, 2025 and September 27, 2024, respectively. These payments included severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment and other costs in connection with the closure and optimization of facilities and product lines.
Previous report
Cash flows used in investing activities during the nine months ended October 3, 2025 primarily comprise approximately $440 million of cash used for the acquisitions of Bavaria, DeltaP, Aktiv and EWM and during the nine months ended September 27, 2024 included approximately $87 million of cash used for the acquisition of Sager S.A. and ESAB Bangladesh.
Reworded paragraphs (37)
Previous wording
All statements contained in this Form 10-Q that are not historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Exchange Act. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this Form 10-Q is filed with the Securities and Exchange Commission (the “SEC”). Statements that could be deemed to be forward-looking statements, include statements regarding: the impact of the war in Ukraine and the conflict in the Middle East and the resulting escalating geopolitical tensions on our business; projections of revenue, profit margins, expenses, tax provisions and tax rates, earnings or losses from operations, impact of foreign exchange rates, cash flows, pension and benefit obligations and funding requirements, synergies or other financial items; plans, strategies and objectives of our management for future operations, including statements relating to potential acquisitions, compensation plans or purchase commitments; developments, performance, industry or market rankings relating to products or services; future economic conditions or performance, including the impact of inflationary pressures, tariffs and trade policies, foreign exchange fluctuations and commodity prices; the outcome of outstanding claims or legal proceedings, including asbestos-related liabilities and insurance coverage litigation; potential gains and recoveries of costs; assumptions underlying any of the foregoing; and any other statement that addresses activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future. Forward-looking statements may be, but are not always, characterized by terminology such as “believe,” “anticipate,” “should,” “would,” “could,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy,” “targets,” “aims,” “seeks,” “sees” or similar expressions. These statements are based on assumptions and assessments made by our management as of the filing date of this Form 10-Q in light of their experience and perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties and actual results or outcomes, or the timing of results or outcomes, could differ materially due to numerous factors, including but not limited to the following:
Current wording
All statements contained in this Form 10-Q that are not historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Exchange Act. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this Form 10-Q is filed with the Securities and Exchange Commission (the “SEC”). Statements that could be deemed to be forward-looking statements, include statements regarding: the pending acquisition of Eddyfi Technologies and its anticipated benefits, the impact of the war in Ukraine and conflicts in the Middle East and the resulting escalating geopolitical tensions on our business; projections of revenue, profit margins, expenses, tax provisions and tax rates, earnings or losses from operations, impact of foreign exchange rates, cash flows, pension and benefit obligations and funding requirements, synergies or other financial items; plans, strategies and objectives of our management for future operations, including statements relating to potential acquisitions, compensation plans or purchase commitments; developments, performance, industry or market rankings relating to products or services; future economic conditions or performance, including the impact of inflationary pressures, tariffs and trade policies, foreign exchange fluctuations and commodity prices; the outcome of outstanding claims or legal proceedings, including asbestos-related liabilities and insurance coverage litigation; potential gains and recoveries of costs; assumptions underlying any of the foregoing; and any other statement that addresses activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future. Forward-looking statements may be, but are not always, characterized by terminology such as “believe,” “anticipate,” “should,” “would,” “could,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy,” “targets,” “aims,” “seeks,” “sees” or similar expressions. These statements are based on assumptions and assessments made by our management as of the filing date of this Form 10-Q in light of their experience and perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties and actual results or outcomes, or the timing of results or outcomes, could differ materially due to numerous factors, including but not limited to the following:
Previous wording
•the war in Ukraine and conflict in the Middle East, escalating geopolitical tensions and the related impact on energy supplies and prices;
Current wording
•the war in Ukraine and conflicts in the Middle East, escalating geopolitical tensions and the potential for an extended regional war and the related impact on energy supplies and prices;
Previous wording
•risks associated with our international operations, including risks from trade protection measures and other changes in trade relations;
Current wording
•risks associated with our international operations, including risks from tariffs and other trade protection measures and other changes in trade relations;
Previous wording
•risks arising from changes in technology;
Current wording
•risks arising from changes in technology, including failure to successfully integrate new technologies such as artificial intelligence;
Previous wording
•other risks and factors set forth under “Risk Factors” in Part I. Item 1A. in our 2024 Form 10-K and in Part II. Item 1A in our Form 10-Q for the quarterly period ended April 4, 2025 (the “2025 Q1 Form 10-Q”).
Current wording
•other risks and factors set forth under “Risk Factors” in Part II. Item 1A of this Form 10-Q and “Risk Factors” in Part I. Item 1A. in our 2025 Form 10-K.
Previous wording
See Part I. Item 1.A. “Risk Factors” in our 2024 Form 10-K and in Part II. Item 1A in our 2025 Q1 Form 10-Q for a further discussion regarding reasons that actual results and outcomes, and the timing of results and outcomes, may differ materially from the results, developments and business decisions contemplated by our forward-looking statements. Forward-looking statements speak only as of the date of this Form 10-Q. We do not assume any obligation to update or revise any forward-looking statement, whether because of new information, future events and developments or otherwise.
Current wording
See Part I. Item 1.A. “Risk Factors” in our 2025 Form 10-K for a further discussion regarding reasons that actual results and outcomes, and the timing of results and outcomes, may differ materially from the results, developments and business decisions contemplated by our forward-looking statements. Forward-looking statements speak only as of the date of this Form 10-Q. We do not assume any obligation to update or revise any forward-looking statement, whether because of new information, future events and developments or otherwise.
Previous wording
We are a focused premier industrial compounder. Our rich history of innovative products, workflow solutions and our business system, ESAB Business Excellence (“EBX”), enables our purpose of Shaping the world we imagine TM. We conduct our operations through two reportable segments. These segments consist of the “Americas,” which includes operations in North America and South America, and “EMEA & APAC,” which includes Europe, Middle East, India, Africa and Asia Pacific. We serve a global customer base across multiple markets through a combination of direct sales and third-party distribution channels. Our customer base is highly diversified in the industrial end markets.
Current wording
We are a focused premier industrial compounder. Our rich history of innovative products, workflow solutions and our business system, ESAB Business Excellence (“EBXai”), enables our purpose of Shaping the world we imagine TM. We conduct our operations through two reportable segments. These segments consist of the “Americas,” which includes operations in North America and South America, and “EMEA & APAC,” which includes Europe, the Middle East, India, Africa and Asia Pacific. We serve a global customer base across multiple markets through a combination of direct sales and third-party distribution channels. Our customer base is highly diversified in the industrial end markets.
Previous wording
We expect strategic acquisitions to contribute to our growth. We believe that our extensive experience of acquiring and effectively integrating acquisition targets should enable us to capitalize on future opportunities. We believe our recent acquisitions are aligned with this strategic direction. Refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q for additional information.
Current wording
We expect strategic acquisitions to contribute to our growth. We believe that our extensive experience of acquiring and effectively integrating acquisition targets should enable us to capitalize on future opportunities. We believe our recent acquisitions are aligned with this strategic direction. On January 31, 2026, the Company entered into an agreement to acquire Eddyfi Technologies (“Eddyfi”), a global leader in advanced inspection and monitoring technologies headquartered in Quebec, Canada, for a purchase price of approximately $1.45 billion. For the year ended December 31, 2025, Eddyfi’s Revenues totaled approximately $240 million. Refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q for additional information.
Previous wording
The discussion that follows includes a comparison of our results of operations and liquidity and capital resources for the three and nine months ended October 3, 2025 and September 27, 2024.
Current wording
The discussion that follows includes a comparison of our results of operations and liquidity and capital resources for the three months ended April 3, 2026 and April 4, 2025.
Previous wording
The comparability of our operating results for the three and nine months ended October 3, 2025 and September 27, 2024 is affected by the following significant factors:
Current wording
The comparability of our operating results for the three months ended April 3, 2026 and April 4, 2025 is affected by the following significant factors:
Previous wording
The invasion of Ukraine by Russia and the sanctions and other actions taken by governments in response to this crisis have increased the level of economic and political uncertainty. Refer to Note 1, “Organization and Basis of Presentation” in the accompanying Notes contained elsewhere in this Form 10-Q as well as Part I. Item 1.A. “Risk Factors”section of the 2024 Form 10-K, as updated by our 2025 Q1 Form 10-Q, for additional information.
Current wording
The invasion of Ukraine by Russia and the sanctions and other actions taken by governments in response to this crisis have increased the level of economic and political uncertainty. Refer to Note 1, “Organization and Basis of Presentation” in the accompanying Notes contained elsewhere in this Form 10-Q as well as Part I. Item 1.A. “Risk Factors”section of the 2025 Form 10-K for additional information.
Previous wording
The Company continues to actively monitor the changes in United States policy regarding international trade, including the recent progress in reaching or progressing international trade agreements with major counterparties. As reflected in the discussions that follow, the United States policy regarding international trade and actions taken in response to it have had a variety of impacts on our results of operations during 2025, including decreased sales levels and increased raw material costs. For additional information on the risks of United States policy regarding international trade to the Company’s operations, refer to the“Part II. Item 1A. Risk Factors”section in our 2025 Q1 Form 10-Q.
Current wording
The Company continues to actively monitor the changes in United States policy regarding international trade, including the recent progress in reaching or progressing international trade agreements with major counterparties. As reflected in the discussions that follow, the United States policy regarding international trade and actions taken in response to it have had a variety of impacts on our results of operations during 2025 and the first quarter of 2026, including decreased sales levels and increased raw material costs. For additional information on the risks of United States policy regarding international trade to the Company’s operations, refer to Part I. Item 1.A. “Risk Factors”section of the 2025 Form 10-K for additional information.
Previous wording
We complement our organic growth with acquisitions and other investments. Acquisitions can affect our reported results, and we report the change in our Net sales between periods both from existing and acquired businesses. The change in Net sales due to acquisitions for the periods presented in this filing represents the incremental sales as a result of acquisitions. For additional information on our acquisitions, refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q.
Current wording
We complement our organic growth with acquisitions and other investments. Acquisitions can affect our reported results, and we report the change in our Net sales between periods both from existing and acquired businesses. The change in Net sales due to acquisitions for the periods presented in this filing represents the incremental sales as a result of acquisitions. For additional information on our acquisitions, refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q and Note 5, “Acquisitions” in the Company’s 2025 Form 10-K.
Previous wording
A significant portion of our Net sales,79%for the three and nine months ended October 3, 2025 are outside the United States, with the majority of those sales denominated in currencies other than the U.S. Dollar. Because much of our manufacturing and employee costs are outside the United States, a significant portion of our costs are also denominated in currencies other than the U.S. Dollar. Changes in foreign exchange rates can impact our results of operations and are quantified when significant.
Current wording
A significant portion of our Net sales,79%for the three months ended April 3, 2026 are outside the United States, with the majority of those sales denominated in currencies other than the U.S. Dollar. Because much of our manufacturing and employee costs are outside the United States, a significant portion of our costs are also denominated in currencies other than the U.S. Dollar. Changes in foreign exchange rates can impact our results of operations and are quantified when significant.
Previous wording
For the three months ended October 3, 2025 compared to the three months ended September 27, 2024, fluctuations in foreign currencies increased Net sales by 1.5%, Gross profit by 1.6% and Selling, general and administrative expenses by 2.1%.
Current wording
For the three months ended April 3, 2026 compared to thethree months ended April 4, 2025, fluctuations in foreign currencies increased Net sales by 5.5% and Gross profit by 5.5% and increased Selling, general and administrative expenses by 6.1%.
Previous wording
Adjusted EBITDA is a non-GAAP performance measure that we include in this Form 10-Q because it is a key metric used by our management to assess our operating performance. ESAB presents this non-GAAP financial measure including and excluding Russia due to economic and political volatility caused by the Russia and Ukraine conflict, which we believe results in enhanced investor interest in these alternative presentations. Adjusted EBITDA excludes from Net income from continuing operations the effect of Income tax expense, Interest expense and other, net, Pension settlement loss, Restructuring and other related charges, acquisition transaction, due diligence and integration expenses, amortization of intangibles and fair value charges on acquired inventories and depreciation and other amortization. We also present Adjusted EBITDA margin, which is subject to the same adjustments as Adjusted EBITDA. Further, we present these non-GAAP performance measures on a segment basis subject to the same adjustments described above. We also present Core adjusted EBITDA and Core adjusted EBITDA margin, which are subject to the same adjustments as Adjusted EBITDA and Adjusted EBITDA margin, respectively, and which removes the impact of Russia for the three and nine months ended October 3, 2025 and September 27, 2024. Adjusted EBITDA and Core adjusted EBITDA assist management in comparing our operating performance over time because certain items may obscure underlying business trends and make comparisons of long-term performance difficult, as they are of a nature and/or size that occur with inconsistent frequency or relate to unusual events or discrete restructuring plans and other initiatives that are fundamentally different from our ongoing productivity and core business. Management also believes that presenting these measures allows investors to view our performance using the same measures that we use in evaluating our financial and business performance and trends.
Current wording
Adjusted EBITDA is a non-GAAP performance measure that we include in this Form 10-Q because it is a key metric used by our management to assess our operating performance. ESAB presents this non-GAAP financial measure including and excluding Russia due to economic and political volatility caused by the Russia and Ukraine conflict, which we believe results in enhanced investor interest in these alternative presentations. Adjusted EBITDA excludes from Net income from continuing operations the effect of Income tax expense, Interest expense and other, net, Restructuring and other related charges, acquisition transaction, due diligence and integration expenses, amortization of intangibles and fair value step up on acquired inventories and depreciation and other amortization. We also present Adjusted EBITDA margin, which is subject to the same adjustments as Adjusted EBITDA. Further, we present these non-GAAP performance measures on a segment basis subject to the same adjustments described above. We also present Core adjusted EBITDA and Core adjusted EBITDA margin, which are subject to the same adjustments as Adjusted EBITDA and Adjusted EBITDA margin, respectively, and which removes the impact of Russia for the three months ended April 3, 2026 and April 4, 2025. Adjusted EBITDA and Core adjusted EBITDA assist management in comparing our operating performance over time because certain items may obscure underlying business trends and make comparisons of long-term performance difficult, as they are of a nature and/or size that occur with inconsistent frequency or relate to unusual events or discrete restructuring plans and other initiatives that are fundamentally different from our ongoing productivity and core business. Management also believes that presenting these measures allows investors to view our performance using the same measures that we use in evaluating our financial and business performance and trends.
Previous wording
The following tables set forth a reconciliation of Net income from continuing operations, the most directly comparable GAAP financial measure, to Adjusted EBITDA, Adjusted EBITDA margin, Core adjusted EBITDA and Core adjusted EBITDA margin by segment for the three and nine months ended October 3, 2025 and September 27, 2024.
Current wording
The following tables set forth a reconciliation of Net income from continuing operations, the most directly comparable GAAP financial measure, to Adjusted EBITDA, Adjusted EBITDA margin, Core adjusted EBITDA and Core adjusted EBITDA margin by segment for the three months ended April 3, 2026 and April 4, 2025.
Previous wording
(1) Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating
Current wording
(2)Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines.
Previous wording
(3)Includes transaction, diligence and integration expenses totaling $2.5 million and $3.1 million for the three and nine months ended September 27, 2024, respectively, and amortization of intangibles and fair value charges on acquired inventories totaling $7.6 million and $22.4 million for the three and nine months ended September 27, 2024, respectively.
Current wording
(3)Includes transaction, diligence and integration expenses totaling $10.3 million for the three months ended April 3, 2026 and amortization of intangibles and fair value step up on acquired inventories totaling $12.5 million for the three months ended April 3, 2026.
Previous wording
(5)Net sales were $37.7 million and $112.0 million relating to Russia for the three and nine months ended September 27, 2024, respectively.
Current wording
(5)Net sales were$31.1 million relating to Russia for thethree months ended April 3, 2026.
Previous wording
(3)Includes transaction, diligence and integration expenses totaling $6.1 million and $20.4 million for thethree andnine months ended October 3, 2025, respectively, and amortization of intangibles and fair value charges on acquired inventories totaling $10.3 million and $27.3 million for thethree andnine months ended October 3, 2025, respectively.
Current wording
(3)Includes transaction, diligence and integration expenses totaling $1.4 million for the three months ended April 4, 2025 and amortization of intangibles and fair value step up on acquired inventories totaling $8.2 million for the three months ended April 4, 2025.
Previous wording
(5)Net sales were$40.4 million and$108.8 million relating to Russia for the three andnine months ended October 3, 2025, respectively.
Current wording
(5)Net sales were $31.3 million relating to Russia for the three months ended April 4, 2025.
Previous wording
The following table presents the components of changes in our Net salesfor the three and nine months ended October 3, 2025 compared to the prior year period.
Current wording
The following table presents the components of changes in our Net salesfor the three months ended April 3, 2026 compared to the prior year period.
Previous wording
(2)Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume.
Current wording
(1)Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume.
Previous wording
(4)Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates.
Current wording
(3)Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates.
Previous wording
Net sales from existing businesses decreased by $5.8 million during the nine months ended October 3, 2025, compared to the prior year period, due to a $28.1 million decrease in sales volume due to drivers such as tariffs in the Americas and lower volumes in Russia partially offset by customer pricing increases of $22.3 million. The increase in net sales from acquisitions was attributable to Sager S.A., ESAB Bangladesh Private Limited (“ESAB Bangladesh”), SUMIG, Bavaria, DeltaP, Aktiv and EWM. The changes in foreign exchange rates resulted in a $12.3 million unfavorable currency translation impact.
Current wording
Net sales from existing businesses decreased by $12.6 million during the three months ended April 3, 2026, compared to the prior year period, due to a $21.7 million decrease in sales volume due to drivers such as tariffs in the Americas, logistics challenges in Middle East related to the war in Iran and lower volumes in Russia partially offset by customer pricing increases of $9.0 million. The increase in net sales from acquisitions was attributable to Bavaria Schweisstechnik (“Bavaria”), DeltaP s.r.l. (“DeltaP”), Aktiv Technologies Private Limited (“Aktiv”) and EWM GmbH (“EWM”). The changes in foreign exchange rates resulted in a $37.3 million favorable currency translation impact.
Previous wording
The following table presents the components of changes in our Net sales excluding Russia (“Core sales”) for the three and nine months ended October 3, 2025 compared to the prior year period.
Current wording
The following table presents the components of changes in our Net sales excluding Russia (“Core sales”) for the three months ended April 3, 2026 compared to the prior year period.
Previous wording
(5)Net sales relating to Russia were $40.4 million and $37.7 million for the three months ended October 3, 2025 and September 27, 2024, respectively, and $108.8 million and $112.0 million for the nine months ended October 3, 2025 and September 27, 2024, respectively.
Current wording
(5)Net sales relating to Russia were $31.1 million and $31.3 million for the three months ended April 3, 2026 and April 4, 2025, respectively.
Previous wording
Core Sales from existing businesses increased by $6.6 million during the nine months ended October 3, 2025, compared to the prior year period, primarily due to customer pricing increases of $20.9 million partially offset by a $14.3 million decrease in sales volume due to drivers such as tariffs in the Americas. The increase in net sales from acquisitions was attributable to Sager S.A., ESAB Bangladesh, SUMIG, Bavaria, DeltaP, Aktiv and EWM. The changes in foreign exchange rates resulted in a $21.4 million unfavorable currency translation impact.
Current wording
Core Sales from existing businesses decreased by $7.4 million during the three months ended April 3, 2026, compared to the prior year period, primarily due to a $17.0 million decrease in sales volume due to drivers such as tariffs in the Americas and logistics delays in Middle East related to the war in Iran partially offset by $9.5 million of customer pricing increases. The increase in net sales from acquisitions was attributable to Bavaria, DeltaP, Aktiv and EWM. The changes in foreign exchange rates resulted in a $32.2 million favorable currency translation impact.
Previous wording
(2) Includes transaction, diligence and integration expenses totaling $6.1 million and $20.4 million for the three and nine months ended October 3, 2025, respectively, and $2.5 million and $3.1 million for the three and nine months ended September 27, 2024, respectively. Additionally, it includes amortization of intangibles and fair value charges on acquired inventories totaling $10.3 million and $27.3 million for the three and nine months ended October 3, 2025, respectively, and $7.6 million and $22.4 million for the three and nine months ended September 27, 2024, respectively.
Current wording
(2) Includes transaction, diligence and integration expenses totaling $10.3 million for the three months ended April 3, 2026 and $1.4 million for the three months ended April 4, 2025. Additionally, it includes amortization of intangibles and fair value step up on acquired inventories totaling $12.5 million for the three months ended April 3, 2026 and $8.2 million for the three months ended April 4, 2025.
Previous wording
Net sales in our Americas segment decreased $38.5 million in the nine months ended October 3, 2025 compared with the prior year period. Net sales from existing business decreased $29.1 million due to reduced sales volumes primarily driven by tariffs and related impacts partially offset by pricing increases. In addition, there was $34.6 million in unfavorable currency translation. The Sager S.A. and SUMIG acquisitions contributed a $25.2 million increase to Net sales from acquisitions. Gross profit decreased $14.9 million attributable to higher material costs, including tariffs, and decreases in sales volume partially offset by acquisitions and price increases. Selling, general and administrative expense increased $3.4 million compared with the prior year period primarily due to acquisitions partially offset by benefits from EBX driven savings. Adjusted EBITDA decreased $9.7 million compared to the prior year period primarily because of the aforementioned factors.
Current wording
Net sales in our Americas segment increased $7.7 million in the three months ended April 3, 2026 compared with the prior year period. Net sales from existing business decreased $2.1 million due to reduced sales volumes primarily driven by tariffs and related impacts partially offset by pricing increases. In addition, there was a $9.8 million favorable increase in currency translation. Gross profit increased $1.4 million attributable to favorable foreign exchange impact and price increases partially offset by higher material costs and volume. The decline of gross profit margin was primarily due to the dilutive effect in the Americas segment, which was caused by tariff-related price pass-through to customers. Selling, general and administrative expense increased $2.3 million compared with the prior year period primarily due to foreign exchange impact. Restructuring and other related charges increased $7.3 million in thethree months ended April 3, 2026 compared with the prior year period primarily driven by strategic initiatives to improve margins in the Americas. Adjusted EBITDA increased $1.5 million compared to the prior year period primarily due to the aforementioned factors.
Previous wording
We expect to finance our working capital requirements through cash flows from operating activities. We expect that our primary ongoing requirements for cash will be for working capital, funding of acquisitions, capital expenditures, restructuring and asbestos related cash outflows, debt service and required principal payments, stock repurchase and, pending approval from the Board of Directors, payment of cash dividends.
Current wording
We expect to finance our working capital requirements through cash flows from operating activities. We expect that our primary ongoing requirements for cash will be for working capital, funding of acquisitions, capital expenditures, restructuring and asbestos-related cash outflows, debt service and required principal payments, stock repurchase and, subject to approval from the Board of Directors, payment of cash dividends.
Previous wording
As of October 3, 2025, we were in compliance with the covenants under the Credit Agreement and the Indenture. The Company’s weighted average interest rate of borrowings under the Credit Agreement and the Indenture was 5.55%, excluding accretion of deferred financing fees. As of the end of the third quarter, we had the capacity for additional indebtedness of up to $490 million available on the Revolving Facility, subject to meeting financial covenants and other requirements. Additionally, we have the ability to incur $50.0 million of indebtedness pursuant to certain uncommitted credit lines, consisting of an uncommitted credit line that we have used from time to time in the past for short-term working capital needs. After the quarter ended October 3, 2025, on October 16, 2025, the Company entered into an Amended and Restated Credit Agreement that, among other things, provides for (i) a senior term loan A facility in an aggregate principal amount of $350 million, and (ii) a senior revolving credit facility in the amount of $1.05 billion to replace the Company’s existing $400 million Term Loan A-1 Facility and $750 million Revolving Facility and pay off the outstanding principal and interest thereunder. Both facilities mature on October 16, 2030, subject to a springing maturity date under certain circumstances. Refer to Note 10, “Debt,” “Note 16, Subsequent Events” and “Note 11, “Derivatives” in the accompanying Notes contained elsewhere in this Form 10-Q for more information related to the Facilities and derivative instruments. We believe that we could raise additional funds in the form of debt or equity if it were determined to be appropriate for strategic acquisitions or other corporate purposes. We believe that our sources of liquidity between debt and cash flows from operating activities are adequate to fund our operations for the next twelve months and thereafter.
Current wording
As of April 3, 2026, we were in compliance with the covenants under the A&R Credit Agreement and the Indentures. The Company’s weighted average interest rate of borrowings under the Credit Agreement and the Indentures was 5.45%, excluding accretion of deferred financing fees. As of the end of the first quarter, we had the capacity for additional indebtedness of up to $1,050 million available on the Revolving Facility. Additionally, we have the ability to incur $73.1 million of indebtedness pursuant to certain uncommitted credit lines, consisting primarily of an uncommitted credit line that we currently have in place, which we have used from time to time in the past for short-term working capital needs. Refer to Note 9, “Debt” and Note 10, “Derivatives” in the accompanying Notes contained elsewhere in this Form 10-Q for more information related to the Company’s debt and derivative instruments. We believe that we could raise additional funds in the form of debt or equity if it were determined to be appropriate for strategic acquisitions or other corporate purposes. We believe that our sources of liquidity between debt and cash flows from operating activities are adequate to fund our operations for the next twelve months and thereafter.
Previous wording
On August 13, 2024, the Board of Directors authorized and approved a stock repurchase program to repurchase up to five million shares of the Company’s Common stock, par value $0.001 per share, from time-to-time on the open market, in privately negotiated transactions or as may otherwise be determined by the Company’s management in its discretion. No repurchases of the Company’s Common stock have been made through the nine months ended October 3, 2025. The timing and amount of any shares repurchased will be determined by the Company’s management based on its evaluation of market conditions, applicable legal requirements and other factors. There is no term associated with the remaining repurchase authorization.
Current wording
On August 13, 2024, the Board of Directors authorized and approved a stock repurchase program to repurchase up to five million shares of the Company’s Common stock, par value $0.001 per share, from time-to-time on the open market, in privately negotiated transactions or as may otherwise be determined by the Company’s management in its discretion. No repurchases of the Company’s Common stock have been made through the share repurchase program since inception. The timing and amount of any shares repurchased will be determined by the Company’s management based on its evaluation of market conditions, applicable legal requirements and other factors. There is no term associated with the remaining repurchase authorization.
Previous wording
As of October 3, 2025, we had$218.2 million of Cash and cash equivalents, a decrease of $31.1 million from the balance of$249.4 millionas of December 31, 2024.
Current wording
As of April 3, 2026, the Company had$1.0 billion of Cash and cash equivalents, an increase of $818.9 million from the balance of$185.9 millionas of December 31, 2025.
Previous wording
•Discontinued operations for the nine months ended October 3, 2025 and September 27, 2024 included outflows of $10.8 million and $12.1 million, respectively, which were primarily asbestos-related.
Current wording
•Discontinued operations for the three months ended April 3, 2026 and April 4, 2025 included outflows of $4.3 million and $2.3 million, respectively, which were primarily asbestos-related.
Previous wording
Our Cash and cash equivalents as of October 3, 2025 included $211.5 million held in jurisdictions outside the United States. Cash repatriation of non-United States cash into the United States may be subject to withholding taxes, other local statutory restrictions and minority owner distributions.
Current wording
Our Cash and cash equivalents as of April 3, 2026 included $193.8 million held in jurisdictions outside the United States. Cash repatriation of non-United States cash into the United States may be subject to withholding taxes, other local statutory restrictions and minority owner distributions.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
For the nine months ended October 3, 2025 compared to thenine months ended September 27, 2024, fluctuations in foreign currencies reduced Net sales by 0.6% and Gross profit by 0.2% and increased Selling, general and administrative expenses by 0.2%.