Veralto Corp
For the period ended Apr 4, 2025. Filed Apr 30, 2025.
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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 4, 2025 · Filed Apr 30, 2025
VLTO$117.09+0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-27; filed 2024-10-24.
0001967680-24-000137
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-04-04; filed 2025-04-30.
0001967680-25-000067
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 164 previous paragraphs and 158 current paragraphs.
66 unchanged; 60 reworded; 28 added; 37 removed; 1 previous and 4 current paragraphs rearranged.
Tables are not compared: 10 previous and 10 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 (28)
Current report
Below is a summary of material risks and uncertainties we face, some of which we have experienced and any of which may occur in the future. These risks are discussed more fully in “Item 1A. Risk Factors” in the 2024 Annual Report on Form 10-K:
Current report
Business and Strategic Risks
Current report
Acquisitions, Divestitures and Investment Risks
Current report
•Divestitures or other dispositions could negatively impact our business and financial statements.
Current report
Operational Risks
Current report
Intellectual Property Risks
Current report
Financial and Tax Risks
Current report
Legal, Regulatory, Compliance and Reputational Risks
Current report
Separation and Our Relationship with Danaher Risks
Current report
Veralto Corporation is a Delaware corporation and was incorporated in 2023 in connection with the separation of Veralto from Danaher Corporation (“Danaher” or “Former Parent”) on September 30, 2023 as an independent, publicly traded company, listed on the New York Stock Exchange (the “Separation”). At the time of the Separation, Veralto Corporation consisted of Danaher’s former Environmental & Applied Solutions segment. The Separation was effectuated through a pro-rata dividend distribution on September 30, 2023 of all of the issued and outstanding shares of Veralto common stock held by Danaher as of September 13, 2023. Each Danaher stockholder of record as of the close of business on September 13, 2023 received one share of Veralto common stock for every three shares of Danaher common stock held on the record date.
Current report
Year-over-year sales and net earnings growth in the three months ended April 4, 2025, particularly related to recurring revenue, benefited from three additional days in the Company's first fiscal quarter of 2025 as compared to the first fiscal quarter of 2024. The benefit of these extra days in the fiscal first quarter will be offset by fewer days in the Company's fiscal fourth quarter of 2025 as compared to the prior year.
Current report
Looking out over the balance of 2025, in our Water Quality Segment we continue to expect positive secular growth drivers across industrial markets particularly in North America, along with steady demand at municipalities. In our Product Quality and Innovation segment we expect to see steady demand in the consumer-packaged goods markets as the year progresses.
Current report
Across both segments we continue to evaluate the potential impact of tariffs and further potential changes in trade policies and tariffs with the objective of implementing various countermeasures to mitigate the impact of tariffs, trade policies and other macroeconomic volatility. In any end market environment, the Company leverages VES to drive growth and continuous improvement.
Current report
Cost of sales increased by $28 million or 5.6% on a year-over-year basis during the three-month period ended April 4, 2025, as compared to the comparable period in 2024, driven primarily by higher year-over-year sales volumes and the impact of foreign currency exchange rates.
Current report
Gross profit margins increased 40 basis points on a year-over-year basis for the three-month period ended April 4, 2025, as compared to the comparable period in 2024, driven by positive pricing actions and the net positive impact from the gross profit margin of recent acquisitions offset by the impacts from foreign currency exchange rates.
Current report
Operating profit margins were 24.2% for the three-month period ended April 4, 2025 as compared to 23.5% for the three-month period ended March 29, 2024. The following factors impacted year-over-year operating profit margin comparisons:
Current report
•Costs incurred during the first quarter of 2025 related to certain strategic initiatives - 20 basis points
Current report
•The net dilutive impact during 2025 of acquisitions and dispositions - 20 basis points
Current report
Core sales in the Water Quality segment increased 7.4% year-over-year during the three-month period ended April 4, 2025. Geographically, core sales growth was driven by increases of 8.3% in North America and 11.3% in Western Europe during the three-month period ended April 4, 2025 compared to the comparable period in 2024. Core sales in high-growth markets also increased 3.3%, driven by high-single digit increases in Latin America offset by mid-single digit decreases in China.
Current report
Operating profit margins were 24.9% for the three-month period ended April 4, 2025 as compared to 24.2% for the three-month period ended March 29, 2024. The following factors impacted year-over-year operating profit margin comparisons:
Current report
•The net accretive impact in 2025 of 2024 product line dispositions - 10 basis points
Current report
•Higher first quarter 2025 core sales, partially offset by foreign currency exchange rates and incremental sales and marketing growth initiatives - 50 basis points
Current report
Operating profit margins were 27.1% for the three-month period ended April 4, 2025 as compared to 26.8% for the three-month period ended March 29, 2024. The following factors impacted year-over-year operating profit margin comparisons:
Current report
•The net dilutive impact in 2025 of acquisitions and dispositions - 70 basis points
Current report
Other income (expense), net included losses on the dispositions of product lines of $6 million and $15 million for the three-month periods ended April 4, 2025 and March 29, 2024, respectively.
Current report
Pursuant to U.S. tax law, the Company’s initial U.S. federal income tax return was filed during October 2024 for the short taxable year September 30, 2023 through December 31, 2023. The Company expects to file its first full year U.S. federal income tax return for 2024 with the Internal Revenue Service (“IRS”) during 2025. The IRS has not initiated an examination of the Company’s tax return filed in 2024. The Company’s operations in certain U.S. states and foreign jurisdictions remain subject to routine examination.
Current report
Shelf Registration Statement
Current report
On October 24, 2024, the Company filed a shelf registration statement on Form S-3 with the SEC (the “Shelf Registration Statement”) that registers an indeterminate amount of debt securities, common stock, preferred stock, depositary shares, subscription rights, purchase contracts, units and warrants that may be issued in the future in one or more offerings. Unless otherwise specified in the corresponding prospectus supplement, the Company expects to use net proceeds realized from future securities issuances off the Shelf Registration Statement for general corporate purposes, including without limitation repayment or refinancing of debt or other corporate obligations, acquisitions, capital expenditures, and working capital.
Removed paragraphs (37)
Previous report
•Basis of Presentation;
Previous report
Forward-looking statements are based on assumptions and assessments made by our management in light of their experience and perceptions of historical trends, current conditions, expected future developments and other factors. Forward-looking statements are not guarantees of future performance and actual results may differ materially from the results, developments and business decisions contemplated by our forward-looking statements. Accordingly, you should not place undue reliance on any such forward-looking statements. Important factors that in some cases have affected us in the past and that in the future could cause actual results to differ materially from those envisaged in the forward-looking statements include the following:
Previous report
•Our acquisition or divestiture of businesses, investments, joint ventures and other strategic relationships can negatively impact our business and financial statements.
Previous report
BASIS OF PRESENTATION
Previous report
The accompanying Consolidated and Combined Condensed Financial Statements present the historical financial position of the Company, results of operations, changes in equity and cash flows in accordance with generally accepted accounting principles in the United States (“GAAP”). Prior to the Separation from Danaher on September 30, 2023, Veralto businesses were comprised of certain Danaher operating units. Veralto Corporation and the Veralto Businesses (including the periods prior to the Separation) are collectively referred to as “Veralto” or the “Company” herein.
Previous report
The Combined Condensed Financial Statements for periods prior to the Separation were derived from Danaher’s Consolidated Condensed Financial Statements and accounting records and prepared in accordance with GAAP for the preparation of carved-out combined financial statements. Prior to the Separation, all revenues and costs as well as assets and liabilities directly associated with Veralto have been included in the Combined Condensed Financial Statements. Additionally, the Combined Condensed Financial Statements for periods prior to the Separation included allocations of certain general, administrative, sales and marketing expenses and cost of sales from Danaher’s corporate office and from other Danaher businesses to Veralto, and allocations of related assets, liabilities, and the Former Parent’s investment, as applicable. The allocations were determined on a reasonable basis; however, the amounts are not necessarily representative of the amounts that would have been reflected in the financial statements had Veralto been operating independently of Danaher during the applicable periods. Accordingly, the Combined Condensed Financial Statements may not be indicative of Veralto’s results had the Company been a separate stand-alone entity throughout the periods presented. For further discussion of related party allocations prior to the Separation, including the method for such allocation, refer to Note 18 of the 2023 Annual Report on Form 10-K.
Previous report
Following the Separation, the Consolidated Condensed Financial Statements include the accounts of Veralto and those of its wholly-owned subsidiaries and no longer include any allocations from Danaher.
Previous report
Geographically, the Company’s sales in the three-month period ended September 27, 2024 in developed markets increased year-over-year by 5.4% driven by increased sales of 6.2% in North America and 4.8% in Western Europe, partially offset by decreased sales of 3.3% in other developed markets. Sales in high-growth markets increased 2.8% year-over-year, driven by mid-single digit growth in Latin America partially offset by low-single digit decreases in China. For the same period, core sales in developed markets increased 4.8% driven by an increase in core sales of 5.5% in North America and an increase in core sales of 4.2% in Western Europe, partially offset by a decrease in core sales in other developed markets. Core sales in high-growth markets increased 4.5% driven by high single-digit increases in Latin America partially offset by low-single digit decreases in China.
Previous report
During the fourth quarter, in the Water Quality Segment, the Company continues to expect growth driven by positive secular drivers across industrial markets, particularly in North America, along with steady demand at municipalities globally. In the Product Quality and Innovation segment, the Company expects to benefit from continued gradual recovery in the consumer-packaged goods markets. In any end market environment, the Company leverages VES to drive growth and continuous improvement.
Previous report
On October 4, 2024, the Company completed its acquisition of Information Exchange Holdings, Inc., the holding company that owns TraceGains, for $350 million, subject to customary post-closing adjustments. The Company believes this business complements the PQI segment, specifically the packaging and color solutions business.
Previous report
TraceGains is a leading provider of cloud-based software solutions that enable connected data and digital workflow management to help consumer brands meet increasingly stringent compliance and reporting regulations for food and beverage safety and traceability. Its solutions enable consumer brands to efficiently track ingredient inputs, monitor supplier quality and develop new products with greater safety and increased velocity.
Previous report
Refer to Note 15, “Subsequent Events” in the accompanying Notes contained elsewhere in this Form 10-Q for additional information.
Previous report
Cost of sales decreased by $1 million or 0.2% and by $34 million or 2.2% on a year-over-year basis during the three and nine-month periods ended September 27, 2024, respectively, as compared to the comparable periods in 2023, driven primarily by the impact of lower year-over-year material costs and improved productivity.
Previous report
Gross profit margins increased 200 and 220 basis points on a year-over-year basis for the three and nine-month periods ended September 27, 2024, respectively, as compared to the comparable periods in 2023, driven by positive pricing actions and to a lesser extent lower material costs and improved productivity.
Previous report
Operating profit margins increased 160 basis points from 21.8% during the three-month period ended September 29, 2023 to 23.4% for the three-month period ended September 27, 2024.
Previous report
•Third quarter 2023 impairment charges related to a tradename in the Product Quality and Innovation segment - 50 basis points
Previous report
•Higher third quarter 2024 core sales and year-over-year cost savings associated with productivity improvement initiatives and materials cost savings, partially offset by sales and marketing growth initiatives - 120 basis points
Previous report
•Transaction costs incurred during the third quarter 2024 related to the Company's recent acquisition described in Note 15 - 10 basis points
Previous report
Operating profit margins increased 50 basis points from 22.9% during the nine-month period ended September 29, 2023 to 23.4% for the nine-month period ended September 27, 2024.
Previous report
•Third quarter year-to-date 2023 impairment charge related to customer relationships and a tradename in the Product Quality and Innovation segment - 30 basis points
Previous report
•Higher 2024 core sales, foreign currency exchange rates and cost savings associated with continuing productivity improvement initiatives, partially offset by the impact of incremental costs associated with operating as a stand-alone company, incremental labor and sales and marketing growth initiatives - 30 basis points
Previous report
Year-to-date 2024 vs. year-to-date 2023 operating profit margin comparisons were unfavorably impacted by:
Previous report
•Transaction costs incurred during the third quarter 2024 related to the Company's recent acquisition described in Note 15, and costs incurred as a result of the Separation from Danaher - 10 basis points
Previous report
Core sales in the Water Quality segment increased 4.0% and 3.6% year-over-year during the three and nine-month periods ended September 27, 2024, respectively. Geographically, core sales growth during the three-month period ended September 27, 2024, was driven by increases of 6.7% in North America and increases of 3.7% in Western Europe, offset by decreases of 1.0% in high-growth markets. The core sales decrease in high-growth markets was driven by low double digit percentage core sales declines in China offset by high-single digits core sales increase in Latin America. Geographically, core sales growth during the nine-month period ended September 27, 2024, was driven by increases of 6.3% in North America and increases of 0.4% in Western Europe. Core sales were flat during the nine-month period ended September 27, 2024 in high growth markets driven by mid-single digit decreases in China offset by low single digit increases in Latin America.
Previous report
Operating profit margins decreased 10 basis points during the three-month period ended September 27, 2024 as compared to the comparable period in 2023.
Previous report
•The impact of incremental year-over-year costs associated with labor, sales and select marketing growth initiatives offset by higher 2024 core sales - 10 basis points
Previous report
Operating profit margins increased 50 basis points during the nine-month period ended September 27, 2024 as compared to the comparable period in 2023.
Previous report
•Higher year-to-date 2024 core sales and incremental year-over-year cost savings associated with material costs, net of the impact of incremental year-over-year costs associated with labor and sales and marketing growth initiatives - 50 basis points
Previous report
Operating profit margins increased 620 basis points during the three-month period ended September 27, 2024 as compared to the comparable period in 2023.
Previous report
•The impact of third quarter 2023 impairment charge related to a tradename - 120 basis points
Previous report
•Transaction costs incurred during the third quarter 2024 related to the Company's recent acquisition described in Note 15 - 40 basis points
Previous report
Operating profit margins increased 250 basis points during the nine-month period ended September 27, 2024 as compared to the comparable period in 2023.
Previous report
•The impact of third quarter year-to-date 2023 impairment charges related to customer relationships and a tradename - 80 basis points
Previous report
For a description of the Company’s other income (expense), net during the three and nine-month periods ended September 27, 2024 and September 29, 2023, refer to Note 6 to the accompanying Consolidated and Combined Condensed Financial Statements.
Previous report
The effective tax rate for thethree-month period ended September 27, 2024 differs from the U.S. federal statutory rate of 21% principally due to the geographic mix of earnings described above, net discrete expense of$1 million related primarily to the tax impact of uncertain tax positions, partially offset by excess tax benefits from stock-based compensation. The net discrete expense increased the effective tax rate by 0.3% for thethree-month period ended September 27, 2024.
Previous report
The effective tax rate for thethree-month period ended September 29, 2023 differs from the U.S. federal statutory rate of 21% principally due to the geographic mix of earnings described above, partially offset by net discrete benefits of $6 million related primarily to excess tax benefits from stock-based compensation and changes in estimates associated with prior period uncertain tax positions. The net discrete benefits reduced the effective tax rate by 2.2% for thethree-month period ended September 29, 2023.
Previous report
The effective tax rate for the nine-month period ended September 29, 2023 differs from the U.S. federal statutory rate of 21% principally due to the geographic mix of earnings described above, partially offset by net discrete benefits of $12 million related primarily to excess tax benefits from stock-based compensation. The net discrete benefits reduced the effective tax rate by 1.4% for the nine-month period ended September 29, 2023.
Reworded paragraphs (60)
Previous wording
Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is designed to provide material information relevant to an assessment of the Company’s financial condition and results of operations, including an evaluation of the amounts and certainty of cash flows from operations and from outside sources. The MD&A is designed to focus specifically on material events and uncertainties known to management that are reasonably likely to cause reported financial information not to be necessarily indicative of future operating results or of future financial condition. This includes descriptions and amounts of matters that have had a material impact on reported operations, as well as matters that are reasonably likely based on management’s assessment to have a material impact on future operations. The Company’s MD&A is divided into six sections:
Current wording
Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is designed to provide material information relevant to an assessment of the Company’s financial condition and results of operations, including an evaluation of the amounts and certainty of cash flows from operations and from outside sources. The MD&A is designed to focus specifically on material events and uncertainties known to management that are reasonably likely to cause reported financial information not to be necessarily indicative of future operating results or of future financial condition. This includes descriptions and amounts of matters that have had a material impact on reported operations, as well as matters that are reasonably likely based on management’s assessment to have a material impact on future operations. The Company’s MD&A is divided into five sections:
Previous wording
You should read this discussion along with the Company’s MD&A and audited financial statements and Notes thereto as of and for the year ended December 31, 2023, included within the 2023 Annual Report on Form 10-K, and the unaudited financial statements and related Notes as of and for the three and nine-month periods ended September 27, 2024 included in this Quarterly Report on Form 10-Q (this “Report”).
Current wording
You should read this discussion along with the Company’s MD&A and audited financial statements and Notes thereto as of and for the year ended December 31, 2024, included within the 2024 Annual Report on Form 10-K, and the unaudited financial statements and related Notes as of and for the three-month period ended April 4, 2025 included in this Quarterly Report on Form 10-Q (this “Report”).
Previous wording
Certain statements included or incorporated by reference in this Report, in other documents we file with or furnish to the Securities and Exchange Commission, in our press releases, webcasts, conference calls, materials delivered to shareholders and other communications, are “forward-looking statements” within the meaning of the U.S. federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding: projections of revenue, expenses, profit, profit margins, pricing, tax rates, tax provisions, cash flows, pension and benefit obligations and funding requirements, our liquidity position or other projected financial measures; management’s plans and strategies for future operations, including statements relating to anticipated operating performance, cost reductions, restructuring activities, new product and service developments, competitive strengths or market position, acquisitions and the integration thereof, divestitures, spin-offs, split-offs, initial public offerings, other securities offerings, or other distributions, strategic opportunities, stock repurchases, dividends and executive compensation; growth, declines and other trends in markets we sell into; new or modified laws, regulations and accounting pronouncements; future regulatory approvals and the timing and conditionality thereof; outstanding claims, legal proceedings, tax audits and assessments and other contingent liabilities; future foreign currency exchange rates and fluctuations in those rates; general economic and capital markets conditions; the anticipated timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that Veralto intends or believes will or may occur in the future. Terminology such as “believe,” “anticipate,” “should,” “could,” “intend,” “will,” “plan,” “expect,” “estimate,” “project,” “target,” “may,” “possible,” “potential,” “forecast” and “positioned” and similar references to future periods are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words.
Current wording
Certain statements included or incorporated by reference in this Report, in other documents we file with or furnish to the Securities and Exchange Commission (“SEC”), in our press releases, webcasts, conference calls, materials delivered to shareholders and other communications, are “forward-looking statements” within the meaning of the U.S. federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding: projections of revenue, expenses, profit, profit margins, asset values, pricing, tax rates, tax provisions, cash flows, pension and benefit obligations and funding requirements, our liquidity position or other projected financial measures; management’s plans and strategies for future operations, including statements relating to anticipated operating performance, customer demand, cost reductions, restructuring activities, new product and service developments, competitive strengths or market position, acquisitions and the integration thereof, divestitures, spin-offs, split-offs, initial public offerings, other securities offerings or other distributions, strategic opportunities, stock repurchases, dividends and executive compensation; growth, declines and other trends in markets we sell into, including the impact of changes to global trade policies, restrictions on imports, related countermeasures and reciprocal tariffs; future new or modified laws, regulations, accounting pronouncements or public policy changes; regulatory approvals and the timing and conditionality thereof; outstanding claims, legal proceedings, tax audits and assessments and other contingent liabilities; future foreign currency exchange rates and fluctuations in those rates; results of operations and/or financial condition; general economic and capital markets conditions; the anticipated timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that Veralto intends or believes will or may occur in the future. Terminology such as “believe,” “anticipate,” “assume,” “continue,” “should,” “could,” “intend,” “will,” “plan,” “aim,” “expect,” “estimate,” “project,” “target,” “can,” “may,” “possible,” “potential,” “upcoming,” “forecast” and “positioned” and similar references to future periods are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words. Forward-looking statements are based on assumptions and assessments made by our management in light of their experience and perceptions 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, including but not limited to the risks and uncertainties set forth below and under “Item 1A. Risk Factors” in the 2024 Annual Report on Form 10-K.
Previous wording
•Conditions in the global economy, including military conflicts, the particular markets we serve and the financial markets can adversely affect our business and financial statements.
Current wording
•Conditions in the global economy, including military conflicts and changes in trade and tariff policies, the particular markets we serve and the financial markets can adversely affect our business and financial statements.
Previous wording
•Global economic, political, legal, compliance, social and business factors can negatively affect our business and financial statements.
Current wording
•Non-U.S. economic, political, legal, compliance, social and business factors can negatively affect our business and financial statements.
Previous wording
•Any inability to consummate acquisitions at our historical rate and appropriate prices, and to make appropriate investments that support our long-term strategy, could negatively impact our business.
Current wording
•Any inability to consummate acquisitions at our historical rate and appropriate prices, and to make appropriate investments that support our long-term strategy, could negatively impact our business. Our acquisition of businesses, investments, or other strategic relationships could also negatively impact our business and financial statements and our indemnification rights may not fully protect us from liabilities related thereto.
Previous wording
•If we suffer loss to our facilities, supply chains, distributions systems or information technology systems due to catastrophe or other events, our operations could be seriously harmed.
Current wording
•If we suffer loss to our facilities, supply chains, distribution systems or information technology systems due to catastrophe or other events, our operations could be seriously harmed.
Previous wording
•Climate change, legal or regulatory measures to address climate change and any inability on our part to address stakeholder expectations related to climate change may negatively affect us.
Current wording
•Climate change and sustainability matters, legal or regulatory measures to address climate change and sustainability matters, and any inability on our part to address related stakeholder expectations may negatively affect us.
Previous wording
•Third parties from time to time claim that we are infringing or misappropriating their intellectual property rights and we could suffer from significant litigation expenses, losses or licensing expenses or be prevented from selling products or services.
Current wording
•Third parties from time to time claim that we are infringing or misappropriating their intellectual property rights and we could suffer significant litigation expenses, losses or licensing expenses or be prevented from selling products or services.
Previous wording
•Our outstanding debt has increased significantly as a result of our separation from Danaher, and we may incur additional debt in the future. Our existing and future indebtedness may limit our operations and our use of our cash flow and negatively impact our credit ratings; and any failure to comply with the covenants that apply to our indebtedness could adversely affect our business and financial statements.
Current wording
•Our existing and future indebtedness may limit our operations and our use of our cash flow and negatively impact our credit ratings; and any failure to comply with the covenants that apply to our indebtedness could adversely affect our business and financial statements.
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•Our businesses are subject to extensive regulation, failure to comply with those regulations could adversely affect our business and financial statements.
Current wording
•Our businesses are subject to extensive regulation, and failure to comply with those regulations could adversely affect our business and financial statements.
Previous wording
•If we are unable to implement and maintain effective internal control over financial reporting in the future, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock may be negatively affected.
Current wording
•If we are unable to maintain effective internal control over financial reporting in the future, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock may be negatively affected.
Previous wording
•As an independent, public traded company, Veralto may not enjoy the same benefits that Veralto did as a part of Danaher.
Current wording
•As an independent, publicly traded company, Veralto may not enjoy the same benefits that Veralto did as a part of Danaher.
Previous wording
•In connection with the Separation, Danaher has agreed to indemnify Veralto for certain liabilities. However, there can be no assurance that the indemnity will be sufficient to insure Veralto against the full amount of such liabilities, or that Danaher’s ability to satisfy its indemnification obligation will not be impaired in the future.
Current wording
•In connection with Veralto’s separation from Danaher, Danaher will indemnify Veralto for certain liabilities. However, there can be no assurance that the indemnity will be sufficient to insure Veralto against the full amount of such liabilities, or that Danaher’s ability to satisfy its indemnification obligation will not be impaired in the future.
Previous wording
•Certain of Veralto’s executive officers and directors may have actual or potential conflicts of interest because of their equity interest in Danaher. Also, certain of Danaher’s current directors and a current Danaher officer and a current Danaher employee have joined Veralto’s Board, which may create conflicts of interest or the appearance of conflicts of interest.
Current wording
•Certain of Veralto’s executive officers and directors may have actual or potential conflicts of interest because of their equity interest in Danaher. Also, certain of Danaher’s current directors and a current Danaher officer and current Danaher employee have joined Veralto’s Board, which may create conflicts of interest or the appearance of conflicts of interest.
Previous wording
The Company’s unifying purpose is Safeguarding the World’s Most Vital Resources TM. Our diverse group of leading operating companies provide essential technology solutions that monitor, enhance and protect key resources around the globe. The Company is committed to the advancement of public health and safety and believes it is positioned to support its customers as they address large global challenges including environmental resource sustainability, water scarcity, management of severe weather events, and food and pharmaceutical security. For decades, the Company has used its scientific expertise and innovative technologies to address complex challenges our customers face across regulated industries - including municipal utilities, food and beverage, pharmaceutical and industrials - where the consequence of failure is high. Through its core offerings in water analytics, water treatment, marking and coding and packaging and color, customers look to the Company’s solutions to help ensure the safety, quality, efficiency and reliability of their products and processes. The Company is headquartered in Waltham, Massachusetts with a workforce of approximately 16,000 associates strategically located in more than 45 countries.
Current wording
Veralto Corporation’s unifying purpose is Safeguarding the World’s Most Vital Resources TM. Our diverse group of leading operating companies provide essential technology solutions that monitor, enhance and protect key resources around the globe. We are committed to the advancement of public health and safety and believe we are positioned to support our customers as they address large global challenges including environmental resource sustainability, water scarcity, management of severe weather events, food and pharmaceutical security, and the impact of an aging workforce. For decades, we have used our scientific expertise and innovative technologies to address complex challenges our customers face across regulated industries – including municipal utilities, food and beverage, pharmaceutical and industrials – where the consequence of failure is high. Through our core offerings in water analytics, water treatment, marking and coding, and packaging and color, customers look to our solutions to help ensure the safety, quality, efficiency and reliability of their products, processes and people globally. Veralto is headquartered in Waltham, Massachusetts with a workforce of nearly 17,000 employees (whom we refer to as “associates”) as of December 31, 2024, strategically located in approximately 50 countries.
Previous wording
The Company operates through two segments – Water Quality (“WQ”) and Product Quality & Innovation (“PQI”). The Company’s businesses within these segments have strong globally recognized brands as a result of its leadership in served markets over several decades. Through WQ, the Company provides innovative products and services that improve the quality and reliability of water through leading brands including Hach, Trojan Technologies and ChemTreat. Through PQI, the Company enables customers to promote consumer trust in products and help enable product innovation through leading brands including Videojet, Linx, Esko, X-Rite and Pantone. The Company believes its leading positions result from the strength of our commercial organizations, our legacy of innovation, and our close and long-term connectivity to its customers and knowledge of their workflows, underpinned by our culture of continuous improvement. This has resulted in a large installed base of instruments that drive ongoing consumables and software sales to support the Company’s customers. As a result, the Company’s business generates recurring sales which represented approximately 61% of total sales during the nine-month period ended September 27, 2024. The Company’s business model also supports a strong margin profile with limited capital expenditure requirements and has generated attractive cash flows. The Company believes these attributes allow it to deliver financial performance that is resilient across economic cycles.
Current wording
Veralto operates through two segments – Water Quality (“WQ”) and Product Quality & Innovation (“PQI”). Our businesses within these segments have strong globally recognized brands as a result of our leadership in served markets over several decades. Our WQ segment provides innovative products and services that improve the quality and reliability of water with leading brands including Hach, Trojan Technologies and ChemTreat. Our PQI segment enables our customers to promote consumer trust in their products and help enable product innovation with leading brands including Videojet, Linx, Esko, X-Rite and Pantone. We believe our leading positions result from the strength of our commercial organizations, our legacy of innovation, and our close and long-term connectivity to our customers and knowledge of their workflows, underpinned by our culture of continuous improvement. This has resulted in a large installed base of instruments that drive ongoing consumables and software sales to support our customers. As a result, our business generates recurring sales which represented approximately 61% of total sales during thethree months ended April 4, 2025. Our business model also supports a strong margin profile with limited capital expenditure requirements and has generated attractive cash flows. We believe these attributes allow us to deliver financial performance that is resilient across economic cycles.
Previous wording
As a result of the Company’s geographic and industry diversity, the Company faces a variety of opportunities and challenges, including rapid technological development in most of the Company’s served markets, the expansion and evolution of opportunities in high-growth markets, trends and costs associated with a global labor force, consolidation of the Company’s competitors and increasing regulation. The Company operates in a highly competitive business environment in most markets, and the Company’s long-term growth and profitability will depend in particular on its ability to identify, consummate and integrate appropriate acquisitions and identify and consummate appropriate investments and strategic partnerships, develop innovative and differentiated new products and services with higher gross profit margins, expand and improve the effectiveness of the Company’s sales force, continue to reduce costs and improve operating efficiency and quality, effectively address the demands of an increasingly regulated global environment and expand its business in high-growth geographies and high-growth market segments. The Company is making significant investments, organically and through acquisitions and investments, to address the rapid pace of technological change in its served markets and to globalize its manufacturing, research and development and customer-facing resources (particularly in high-growth markets) to be responsive to the Company’s customers throughout the world and improve the efficiency of the Company’s operations. The Company defines high-growth markets as developing markets of the world experiencing extended periods of accelerated growth in gross domestic product and infrastructure which include Eastern Europe, the Middle East, Africa, Latin America (including Mexico) and Asia (with the exception of Japan, Australia and New Zealand). The Company defines developed markets as all markets of the world that are not high-growth markets.
Current wording
As a result of our geographic and industry diversity, Veralto faces a variety of opportunities and challenges, including rapid technological development in most of our served markets, the expansion and evolution of high-growth markets, trends and costs associated with a global labor force, consolidation of our competitors and increasing regulation. Veralto operates in a highly competitive business environment in most markets, and our long- term growth and profitability will depend in particular on our ability to identify, consummate and integrate appropriate acquisitions and identify and consummate appropriate investments and strategic partnerships, develop innovative and differentiated new products and services with higher gross profit margins, expand and improve the effectiveness of our sales force, continue to reduce costs and improve operating efficiency and quality, effectively address the demands of an increasingly regulated global environment and expand our business in high-growth geographies and high-growth market segments. We are making significant investments, organically and through acquisitions and investments, to address the rapid pace of technological change in our served markets and to globalize our manufacturing, research and development and customer-facing resources to be responsive to our customers throughout the world and improve the efficiency of our operations. We define high-growth markets as developing markets of the world which include Asia (with the exception of Japan, Australia and New Zealand), Latin America (including Mexico), the Middle East, Eastern Europe and Africa. We define developed markets as all markets of the world that are not high-growth markets.
Previous wording
Veralto does and measure how well Veralto executes, grounded in a culture of continuous improvement. The VES processes and tools are organized around the areas of Operational Excellence, Growth and Leadership, and are rooted in foundational tools known as the VES Fundamentals, which are relevant to every associate and business function. The VES Fundamentals are focused on core competencies such as using visual representations of processes to identify inefficiencies, defining and solving problems in a structured way, and continuously improving processes to drive consistent execution.
Current wording
We also believe that the Veralto Enterprise System (“VES”) provides us with a strong foundation for competitive differentiation. VES isa business management system that consists of a philosophy, processes and tools that guide what Veralto does and measure how well Veralto executes, grounded in a culture of continuous improvement. VES processes and tools are organized around the areas of Operational Excellence, Growth and Leadership, and are rooted in foundational tools known as the VES Fundamentals, which are relevant to every associate and business function. The VES Fundamentals are focused on core competencies such as using visual representations of processes to identify inefficiencies, creating standard work, defining and solving problems in a structured way, and continuously improving processes to drive long term impact.
Previous wording
Veralto uses VES tools to improve our profitability and cash flows, which support our ability to expand our addressable market and improve our market position through investments in areas such as our commercial organization and research and development (“R&D”), including software and digital solutions. Our cash flows also support acquisitions to enhance our product capabilities and expansion into new and attractive markets, which we have successfully done through the acquisition of approximately 80 businesses over more than two decades.
Current wording
Veralto uses VES tools to improve our profitability and cash flows, which support our ability to expand our addressable market and improve our market position through investments in areas such as our commercial organization and research and development (“R&D”), including software and digital solutions. Our cash flows also support acquisitions to enhance our product capabilities and expansion into new and attractive markets, which we have successfully done through the acquisition of over 80 businesses over more than two decades.
Previous wording
During the three-month period ended September 27, 2024, the Company’s overall revenues and core sales increased 4.7% compared to the comparable period in 2023 with growth in both segments. Acquisitions, net of divestitures, increased reported sales by 0.1%. For the nine-month period ended September 27, 2024, overall revenues increased 3.1% and core sales increased 3.4% compared to the comparable period in 2023. Currency exchange rates and acquisitions, net of divestitures, decreased reported sales by 0.2% and 0.1%, respectively. For the definition of “core sales” refer to “—Results of Operations”below.
Current wording
During thethree-month period ended April 4, 2025, overall revenues increased 6.9% and core sales increased 7.8% compared to the comparable period in 2024 with growth in both segments. Currency exchange rates decreased reported sales by 1.3% and acquisitions, net of divestitures increased reported sales by 0.4% during thethree-month period ended April 4, 2025 compared to the comparable period in 2024. For the definition of “core sales” refer to “—Results of Operations”below.
Previous wording
Geographically, the Company’s sales in the nine-month period ended September 27, 2024 in developed markets increased year-over-year by 4.0% driven by increased sales of 5.6% in North America and 1.8% in Western Europe, partially offset by decreased sales of 5.6% in other developed markets. Sales in high-growth markets increased 0.7% year-over-year, driven by mid-single digit growth in Latin America partially offset low-single digit decreases in China. For the same period, core sales in developed markets increased 3.6% driven by an increase in core sales of 5.1% in North America and an increase in core sales of 1.0% in Western Europe. Core sales in high-growth markets increased 2.9% driven by mid-single digit increases in Latin America partially offset by low-single digit decreases in China.
Current wording
Geographically, the Company’s sales in the three-month period ended April 4, 2025 in developed markets increased year-over-year by 8.2%, driven by increased sales of 8.6% in North America, 7.5% in Western Europe, and 7.4% in other developed markets. Sales in high-growth markets increased 3.3% year-over-year. For the same period, core sales in developed markets increased 8.7% driven by increased core sales of 7.9% in North America and 10.8% in Western Europe. Core sales in high-growth markets increased 6.1% driven by high-single digit increases in Latin America and low-single digit increases in China.
Previous wording
The Company’s net earnings for the three and nine-month periods ended September 27, 2024 totaled $219 million and $606 million, respectively, compared to $205 million and $639 million, respectively, for the three and nine-month periods ended September 29, 2023. The increase in net earnings during the three-month period ended September 27, 2024 as compared to the three-month period ended September 29, 2023 was driven by higher sales, gross profit and a gain on the disposition of a product line offset bystandalone public company costs and interest expense post Separation from Danaher. The decrease in net earnings during the nine-month period ended September 27, 2024 as compared to the nine-month period ended September 29, 2023 was driven by standalone public company costs, interest expense post Separation from Danaher, select investments in sales and marketing growth initiatives and a net loss on the disposition of product lines. Refer to “—Results of Operations” for further discussion of the year-over-year changes in net earnings for the three and nine-month periods ended September 27, 2024.
Current wording
The Company’s net earnings for the three-month period ended April 4, 2025 totaled $225 million, compared to $184 million for the three-month period ended March 29, 2024. The increase in net earnings was primarily driven by increased sales, resulting from higher volumes and positive pricing actions. Refer to “—Results of Operations” for further discussion of the year-over-year changes in net earnings for the three-month period ended April 4, 2025.
Previous wording
The Company’s outlook for 2024 reflects its current visibility and expectations based on the current market environment and other factors. The Company’s ability to meet its expectations are subject to numerous risks, including, but not limited to, those described in “Item 1A. Risk Factors” within the Company’s 2023 Annual Report on Form 10-K and any subsequent updates in Item “1A. Risk Factors” within Quarterly Reports on Form 10-Q.
Current wording
The Company’s outlook for 2025 reflects its current assessment of the global macro-economic environment, including enacted tariffs and the Company’s actions to mitigate adverse financial impacts. The Company’s ability to meet its expectations are subject to numerous risks, including, but not limited to, those described in “Item 1A. Risk Factors” within the Company’s 2024 Annual Report on Form 10-K and any subsequent updates in Item “1A. Risk Factors” within Quarterly Reports on Form 10-Q.
Previous wording
In this Report, references to the non-GAAP measures of core sales (also referred to as core revenues or sales/revenues from existing businesses) refer to sales from continuing operations calculated according to GAAP but excluding sales from acquired businesses (as defined below) and the impact of currency translation.
Current wording
In this Report, references to the non-GAAP measure of core sales refer to sales from continuing operations calculated according to GAAP but excluding sales from acquired (or divested) businesses (as defined below, as applicable) and the impact of currency translation.
Previous wording
References to sales or operating profit attributable to acquisitions or acquired businesses refer to sales or operating profit, as applicable, from acquired businesses recorded prior to the first anniversary of the acquisition less any sales and operating profit, during the applicable period, attributable to divested product lines not considered discontinued operations. The portion of revenue attributable to currency translation is calculated as the difference between the period-to-period change in revenue (excluding sales from acquired businesses (as defined above, as applicable)) and the period-to-period change in revenue (excluding sales from acquired businesses (as defined above, as applicable)) after applying current period foreign exchange rates to the prior year period.
Current wording
References to sales or operating profit attributable to acquisitions or acquired businesses refer to sales or operating profit, as applicable, from acquired businesses recorded prior to the first anniversary of the acquisition less any sales and operating profit, during the applicable period, attributable to divested product lines not considered discontinued operations. The portion of revenue attributable to currency translation is calculated as the difference between the period-to-period change in revenue (excluding sales from acquired/divested businesses (as defined above, as applicable)) and the period-to-period change in revenue (excluding sales from acquired/divested businesses (as defined above, as applicable)) after applying current period foreign exchange rates to the prior year period.
Previous wording
Total sales increased 4.7% and 3.1% during the three and nine-month periods ended September 27, 2024, respectively, compared to the comparable periods in 2023, primarily as a result of core sales growth driven by the factors discussed below by segment.
Current wording
Total sales increased 6.9% during the three-month period ended April 4, 2025, compared to the comparable period in 2024, primarily as a result of core sales growth driven by the factors discussed below by segment.
Previous wording
Acquisitions, net of divestitures increased reported sales by 0.1% during the three-month period ended September 27, 2024 compared to the comparable period in 2023. Currency exchange rates and acquisitions, net of divestitures decreased reported sales by 0.2% and 0.1%during the nine-month period ended September 27, 2024, respectively, compared to the comparable period in 2023. Price increases contributed 1.8% and 2.0% to sales growth on a year-over-year basis during the three and nine-month periods ended September 27, 2024, respectively, and are reflected as a component of core sales growth above.
Current wording
Price increases contributed 1.3% to sales growth on a year-over-year basis during the three-month period ended April 4, 2025, and are reflected as a component of core sales growth above.
Previous wording
Sales by business segment for each of the periods indicated were as follows ($ in millions):
Current wording
Sales by business segment for each of the periods indicated were as follows:
Previous wording
For information regarding the Company’s sales by geographical region, refer to Note 3 to the accompanying Consolidated and Combined Condensed Financial Statements.
Current wording
For information regarding the Company’s sales by geographical region, refer to Note 3 to the accompanying Consolidated Condensed Financial Statements.
Previous wording
SG&A expenses as a percentage of sales decreased by 10 basis points and increased by 130 basis points during the three and nine-month periods ended September 27, 2024, respectively, as compared to the comparable periods in 2023. The decrease during the three-month period ended September 27, 2024 was primarily driven by core sales growth driven by the factors discussed below by segment exceeding the increase in the Company’s SG&A expense. The increase during the nine-month period ended September 27, 2024 was driven by the increase in the Company’s SG&A expenses exceeding the increase in the Company’s sales, due to select investments in sales and marketing growth initiatives, as well as the costs to operate as a stand-alone company.
Current wording
SG&A expenses as a percentage of sales decreased by 10 basis points during the three-month period ended April 4, 2025, as compared to the comparable period in 2024, driven by the increase in the Company’s sales exceeding the increase in the Company’s SG&A expenses.
Previous wording
R&D expenses as a percentage of sales increased by 40 basis points and by 30 basis points during the three and nine-month periods ended September 27, 2024, respectively, as compared to the comparable periods in 2023, driven by growth related R&D initiatives.
Current wording
R&D expenses as a percentage of sales was flat during the three-month period ended April 4, 2025, as compared to the comparable period in 2024, and primarily consists of growth related R&D initiatives during each of the periods presented.
Previous wording
•The impact of higher 2024 core sales, foreign currency exchange rates and cost savings associated with continuing productivity improvement initiatives, partially offset by incremental labor and sales and marketing growth initiatives - 170 basis points
Current wording
•Higher first quarter 2025 core sales, partially offset by incremental labor costs and sales and marketing growth initiatives - 100 basis points
Previous wording
Third quarter 2024 vs. third quarter 2023 operating profit margin comparisons were favorably impacted by:
Current wording
First quarter 2025 vs. first quarter 2024 operating profit margin comparisons were unfavorably impacted by:
Previous wording
Total segment sales increased 3.6% and 3.1% year-over-year during the three and nine-month periods ended September 27, 2024, respectively, compared to the comparable periods in 2023, primarily as a result of core sales growth driven by the factors discussed below. Geographically, sales growth was driven by North America, which saw increases of 7.1% and 6.7%, and Western Europe, which saw increases of 5.7% and 2.7% for the three and nine-month periods ended September 27, 2024 respectively, compared to the comparable periods in 2023.
Current wording
Total Water Quality segment sales increased 6.0% year-over-year during the three-month period ended April 4, 2025, as compared to the comparable period in 2024, primarily as a result of core sales growth driven by the factors discussed below. Geographically, sales growth was driven by North America, which saw increases of 7.8%, and Western Europe, which saw increases of 7.6% for the three-month period ended April 4, 2025, compared to the comparable period in 2024.
Previous wording
Price increases in the segment contributed 1.4% to sales growth on a year-over-year basis during both the three and nine-month periods ended September 27, 2024, and are reflected as a component of the change in core sales growth.
Current wording
Price increases in the segment contributed 1.0% to sales growth on a year-over-year basis during the three-month period ended April 4, 2025, and are reflected as a component of the change in core sales growth.
Previous wording
The increase in core sales during the three and nine-month periods ended September 27, 2024 was driven by the chemical treatment solutions product line and, to a lesser extent, the analytical instrumentation product line. Core sales in the chemical treatment solutions product line increased 9.0% and 7.3% year-over-year in the three and nine-month periods ended September 27, 2024, respectively, as a result of increased core sales across most major end-markets. Core sales in the analytical instrumentation product line increased 2.4% year-over-year for both the three and nine-month periods ended September 27, 2024 as a result of increased core sales across North America and Western Europe.
Current wording
Theincrease in core sales during the three-month period ended April 4, 2025 was driven by the chemical treatment solutions business and, to a lesser extent, the analytical instrumentation business. Core sales in the chemical treatment solutions business increased 11.1% year-over-year in the three-month period ended April 4, 2025, as a result of increased core sales across most major end-markets. Core sales in the analytical instrumentation business increased 5.9% year-over-year for the three-month period ended April 4, 2025 as a result of increased core sales across Western Europe and North America.
Previous wording
The Company’s Product Quality & Innovation segment provides instruments, consumables, software and services for various marking and coding, traceability, printing, packaging design and quality management, packaging converting and color and appearance management applications for consumer packaged goods and industrial products.
Current wording
The Company’s Product Quality & Innovation segment provides equipment, consumables, software and services for various marking and coding, traceability, printing, packaging design and quality management, packaging converting and color and appearance management applications for consumer-packaged goods and industrial products.
Previous wording
Total segment sales increased 6.3% and 3.1% year-over-year during the three and nine-month periods ended September 27, 2024, respectively, primarily as a result of changes in core sales driven by the factors discussed below. Geographically, sales growth was driven by North America which saw increases of 3.7% and 2.6% and Western Europe which saw increases of 5.7% and 2.7% during the three and nine-month periods ended September 27, 2024, respectively, compared to the comparable periods in 2023. High-growth markets also experienced increased sales of 9.5% and 4.6% during the three and nine-month periods ended September 27, 2024, respectively, compared to the comparable periods in 2023.
Current wording
Geog raphically, sales growth was driven by North America which saw increases of 10.7% and Western Europe which saw increases of 7.3% during the three-month period ended April 4, 2025, compared to the comparable period in 2024. High-growth markets also experienced increased sales of 6.6% during the three-month period ended April 4, 2025 compared to the comparable period in 2024.
Previous wording
Price increases in the segment contributed 2.1% and 2.3% to sales growth on a year-over-year basis during the three and nine-month periods ended September 27, 2024, respectively, and are reflected as a component of the change in core sales growth.
Current wording
Price increases in the segment contributed 1.6% to sales growth on ayear-over-year basis during the three-month period ended April 4, 2025, and are reflected as a component of the change in core sales growth.
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Current report — wording carried from elsewhere
Forward-looking statements are not guarantees of future performance and actual results may differ materially from the results, developments and business decisions contemplated by our forward-looking statements. Accordingly, you should not place undue reliance on any such forward-looking statements. Forward-looking statements speak only as of the date of the report, document, press release, webcast, call, materials or other communication in which they are made. Except to the extent required by applicable law, we do not assume any obligation to update or revise any forward-looking statement, whether as a result of new information, future events and developments or otherwise.
Current report — wording carried from elsewhere
Acquisitions, net of divestitures increased reported sales by 0.4% and curr ency exchange rates decreased reported sales by 1.3% during the three-month period ended April 4, 2025, compared to the comparable period in 2024.
Current report — wording carried from elsewhere
Total Product Quality & Innovation segment sales increased 8.3% year-over-year during the three-month period ended April 4, 2025, primarily as a result of changes in core sales driven by the factors discussed below.
Current report — wording carried from elsewhere
The effective tax rate for the three-month period ended April 4, 2025 differs from the U.S. federal statutory rate of 21% principally due to the geographic mix of earnings described above, the unfavorable impact of a non-deductible loss on the sale of a product line of$2 million, and a net discrete benefit of $2 million related primarily to the impact of excess tax benefits from stock-based compensation. The net discrete items had no impact on the effective tax rate for thethree-month period ended April 4, 2025.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
We also believe that the Veralto Enterprise System (“VES”) provides the Company with a strong foundation for competitive differentiation. VES isa business management system that consists of a philosophy, processes and tools that guide what