Bausch & Lomb Corp 10-Q for FY2026 Q3
Bausch & Lomb Corp (BLCO)
10-Q
2026-10-28
For: 2026-09-30
View Original
Added on
October 28, 2026
About this 10-Q
Bausch & Lomb Corp filed this 10-Q on October 28, 2026, covering the quarter ended September 30, 2026 (FY2026 Q3).
Bausch + Lomb reported third-quarter revenues of $1,375 million, up $94 million or 7%, and attributable net income of $32 million, versus a net loss of $28 million. AI summary
Headline figures
Quarter ended September 30, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $1.38B
- up 7.3% from $1.28B a year earlier
- Net income
- $32M
- compared with a net loss of $28M a year earlier
- Diluted EPS
- $0.09
- compared with -$0.08 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||
For the Quarterly Period Ended | ||||||||
OR | ||||||||
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||
For the transition period from ______ to ______ | ||||||||
Commission File Number: 001-41380
Bausch + Lomb Corporation
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||||||||
(Address of Principal Executive Offices) (Zip Code)
(905 ) 695-7700
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Toronto Stock Exchange | ||||||||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☒ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | Smaller reporting company | Emerging growth company | |||||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Common shares, no par value — 357,497,374 shares outstanding as of October 21, 2026.
BAUSCH + LOMB CORPORATION
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2026
INDEX
| Part I. | Financial Information | |||||||
| Item 1. | ||||||||
| Item 2. | ||||||||
| Item 3. | ||||||||
| Item 4. | ||||||||
| Part II. | Other Information | |||||||
| Item 1. | ||||||||
| Item 1A. | ||||||||
| Item 2. | ||||||||
| Item 3. | ||||||||
| Item 4. | ||||||||
| Item 5. | ||||||||
| Item 6. | ||||||||
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BAUSCH + LOMB CORPORATION
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2026
Introductory Note
Except where the context otherwise requires, all references in this Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2026 (this “Form 10-Q”) to the “Company”, “Bausch + Lomb”, “we”, “us”, “our” or similar words or phrases are to Bausch + Lomb Corporation and its subsidiaries, taken together. In this Form 10-Q, references to “$” are to United States (“U.S.”) dollars and references to “€” are to euros. Unless otherwise indicated, the statistical and financial data contained in this Form 10-Q are presented as of September 30, 2026.
Forward-Looking Statements
Caution regarding forward-looking information and statements and “Safe-Harbor” statements under the U.S. Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws:
To the extent any statements made in this Form 10-Q contain information that is not historical, these statements are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and may be forward-looking information within the meaning defined under applicable Canadian securities laws (collectively, “forward-looking statements”).
These forward-looking statements relate to, among other things: our business strategy, business plans, business prospects and forecasts and changes thereto; product pipeline, prospective products and product approvals, expected launches of new products, product development and results of current and anticipated products; pending acquisitions; anticipated results from completed and pending acquisitions; anticipated revenues for our products; expected Research and Development (“R&D”) and marketing spend; our expected primary cash and working capital requirements for the remainder of 2026 and beyond; our plans for continued improvement in operational efficiency and the anticipated impact of such plans; our beliefs about our manufacturing facilities and relationships; the expected impact of the tariffs imposed (or proposed to be imposed) by the U.S. (including on the countries in which we do business and sectors in which we do business (including pharmaceuticals)) and counter-tariffs or other retaliatory measures imposed (or that may be imposed) on the U.S. by other countries and disruptions to global supply chains and other potential results as a result of these developments and the potential actions the Company may take to help mitigate the impact of the tariffs, counter-tariffs and other trade restrictions and the success of such actions and the Company’s ability to recover any tariffs that are eligible for refund claims and the impact that any such tariff recoveries may have on the Company’s business, financial condition, cash flows and results of operations; expected risks of loss of patent or regulatory exclusivity; our liquidity and our ability to satisfy our debt maturities as they become due; our ability to comply with the covenants contained in our Amended Credit Agreement (as defined below), and in the indentures governing our October 2028 Secured Notes (as defined below), the January 2026 Credit Facility Amendment (as defined below) and January 2031 Secured Notes (as defined below); any proposed pricing actions; exposure to foreign currency exchange rate changes and interest rate changes; the potential effects of the new legislation commonly referred to as One Big Beautiful Bill Act, including the impact of such legislation on the Company’s tax provision for both 2026 and future years; the potential impact of changes in U.S. and non-U.S. tax laws on the Company’s future tax liabilities and effective tax rate, including as a result of the implementation of the Organisation for Economic Co-operation and Development inclusive framework on Base Erosion and Profit Shifting and the protective measures proposed by the United States in response thereto; the outcome of contingencies, such as litigation, subpoenas, investigations, inspections, reviews, audits and regulatory proceedings and any expected indemnifications therefrom; the anticipated impact of the adoption of new accounting standards; general market conditions and economic uncertainty; our expectations regarding our financial performance, including our future financial and operating performance, revenues, expenses, gross margins and income taxes; our impairment assessments, including the assumptions used therein and the results thereof; the anticipated effect of current market conditions and recessionary pressures in one or more of our markets; the anticipated effect of macroeconomic factors, including inflation and fluctuations in exchange rates and interest rates as a result of the imposition of tariff and other trade protection measures; the anticipated impact from the conflict between Russia and Ukraine; the anticipated impact from the conflict involving Iran, by the U.S. and Israel and the related unrest in the Middle East region; and the anticipated separation from Bausch Health Companies Inc. (“BHC”), including the structure and expected timetable for completing such separation transaction.
Forward-looking statements can generally be identified by the use of words such as “believe,” “anticipate,” “expect,” “intend,” “estimate,” “plan,” “schedule,” “continue,” “future,” “will,” “may,” “can,” “might,” “could,” “would,” “should,” “target,” “potential,” “opportunity,” “designed,” “create,” “predict,” “project,” “timeline,” “forecast,” “outlook,” “guidance,” “seek,” “strive,” “suggest,” “prospective,” “propose,” “strategy,” “indicative,” “ongoing,” “likely,” “evolve,” “decrease” or “increase” and positive and negative variations thereof or other similar expressions. In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements may not be appropriate for other purposes.
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Although we have previously indicated certain of these statements set out herein, all of the statements in this Form 10-Q that contain forward-looking statements are qualified by these cautionary statements. These statements are based upon the current expectations and beliefs of management. Although we believe that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed on such statements. Certain material factors or assumptions are applied in making such forward-looking statements, including, but not limited to, factors and assumptions regarding the items previously outlined, those factors, risks and uncertainties outlined below and the assumption that none of these factors, risks and uncertainties will cause actual results or events to differ materially from those described in such forward-looking statements. Actual results may differ materially from those expressed or implied in such statements. Important factors, risks and uncertainties that could cause actual results to differ materially from these expectations include, among other things, the following:
•adverse economic conditions and other macroeconomic factors over which we have no or limited control, including heightened inflation and interest rates, slower growth or a potential recession, and foreign currency rates, which could adversely impact our revenues, expenses and resulting margins;
•risks associated with the imposition of and adverse changes to the U.S. duty, tariff and other trading policies on the countries in which we do business and sectors in which we do business (including pharmaceuticals), and the counter-duties, counter-tariffs and/or other counter-measures implemented in response by other countries, which are expected to increase our manufacturing, distribution and other operational costs due to the higher duties and tariffs and the increased economic risks and uncertainties to the global economy as a result of such tariffs and counter-tariffs and the potential trade wars and global supply chain issues that may be triggered by the tariff changes and changes in consumer habits as a result;
•risks associated with the actions the Company has taken or may take in response to tariffs, counter-tariffs and other trade restrictions in order to help mitigate their impact on the Company and its business, results of operations and financial condition (including the Company’s ability to recover any tariffs that may be eligible for refund claims), including the risk that such actions may not be successful in mitigating the impact in the manner anticipated or at all and the costs and other risks that may be incurred in taking such actions. There can be no assurance that any such actions will be successful in mitigating the impact of the applicable tariffs, counter-tariffs or other trade restrictions;
•trade conflicts, including current and future trade disputes between the United States and other countries;
•the challenges the Company faces following its initial public offering (the “B+L IPO”), including the challenges and difficulties associated with managing an independent, complex business, the limited transitional services still being provided by and to BHC, and any potential, actual or perceived conflict of interest of some of our directors and officers because of their equity ownership in BHC and/or because they also serve as directors of BHC;
•our status as a controlled company, and the possibility that BHC’s interest may conflict with our interests and the interests of our other securityholders and other stakeholders;
•risks and uncertainties associated with the appointment of our new Chairman and Interim Chief Executive Officer, including with respect to the demands of his overlapping role as chief executive officer of BHC and any actual or perceived conflicts of interest relating thereto and any potential changes to the Company's business strategies that he may implement and any potential disruption and uncertainty among management, employees, current and potential customers, other third parties with whom we do business and shareholders that such changes may create;
•risks and uncertainties associated with the proposed plan to separate Bausch + Lomb from BHC, which include, but are not limited to, the expected benefits and costs of the Separation (as defined below), the expected timing of completion of the Separation and its manner and terms (including that it may be consummated as a transfer of all or a portion of BHC’s remaining direct or indirect equity interest in Bausch + Lomb to its shareholders (the “Distribution”), a sale of the Company (a “Sale Transaction”) or another type of transaction), the expectation that if the Separation is to be effected through the Distribution, it will be completed following the achievement of targeted debt leverage ratios, subject to receipt of applicable shareholder and other necessary approvals and other factors (including those factors described in BHC’s public filings), the ability to complete the Distribution considering the various conditions to the completion of the Distribution (some of which are outside the Company’s and BHC’s control, including conditions related to regulatory matters and receipt of applicable shareholder approvals), the impact of any potential sales or dispositions of our common shares by BHC (including in connection with a foreclosure on the Bausch + Lomb common shares owned by BHC or its subsidiary that are or may be pledged as collateral for certain of BHC’s or its subsidiary’s debt), that market or other conditions are no longer favorable to completing the transaction, that applicable shareholder, stock exchange, regulatory or other approval is not obtained on the terms or timelines anticipated or at all, business disruption during the pendency of, or
iii
following, the Separation, diversion of management time on Separation-related issues, retention of existing management team members, the reaction of customers and other parties to the Separation, the structure of the Distribution and/or a Sale Transaction, the qualification of the Distribution as a tax-free transaction for Canadian and/or U.S. federal income tax purposes (including whether or not an advance ruling from the Canada Revenue Agency and/or the Internal Revenue Service will be sought or obtained), the ability of the Company and BHC to satisfy the conditions required to maintain the tax-free status of the Distribution (some of which are beyond their control), other potential tax or other liabilities that may arise as a result of the Distribution, the potential dis-synergy costs resulting from the Separation, the impact of the Separation on relationships with customers, suppliers, employees and other business counterparties, general economic conditions, conditions in the markets the Company is engaged in, behavior of customers, suppliers and competitors, technological developments, as well as legal and regulatory rules affecting the Company’s business. In particular, the Company can offer no assurance that the Separation, Distribution and/or a Sale Transaction will occur at all, or that any such transactions will occur on the timelines or in the manner anticipated by the Company and BHC or that, even if consummated, the Company will realize the anticipated benefits from the Separation;
•ongoing or potential future litigation, claims, challenges and/or regulatory investigations challenging or otherwise relating to the B+L IPO and the proposed Separation from BHC and the costs, expenses, use of resources, diversion of management time and efforts, liability and damages that may result therefrom;
•pricing decisions that we have implemented or may in the future elect to implement at the direction of our pricing committees or otherwise;
•legislative or policy efforts, including those that may be introduced and passed by the U.S. Congress, designed to reduce patient out-of-pocket costs for medicines and other products, which could result in new mandatory rebates and discounts or other pricing restrictions, controls or regulations (including mandatory price reductions);
•ongoing oversight and review of our products and facilities by regulatory and governmental agencies, including periodic audits by the U.S. Food and Drug Administration (the “FDA”) and equivalent agencies outside of the United States and the results thereof;
•actions by the FDA or other regulatory authorities with respect to our products or facilities;
•compliance with the legal and regulatory requirements of our marketed products;
•our ability to comply with the financial and other covenants contained in our Amended Credit Agreement, the indentures governing our October 2028 Secured Notes and January 2031 Secured Notes and other current or future debt agreements, including the limitations, restrictions and prohibitions such covenants may impose on the way we conduct our business, including prohibitions on incurring additional debt if certain financial covenants are not met, our ability to draw under the June 2030 Revolving Credit Facility (as defined below) under our Amended Credit Agreement and restrictions on our ability to make certain investments and other restricted payments;
•any downgrade by rating agencies in our or BHC’s credit ratings, which may impact, among other things, our ability to raise debt and the cost of capital for additional debt issuances;
•changes in the assumptions used in connection with our impairment analyses or assessments, which would lead to a change in such impairment analyses and assessments and which could result in an impairment in the goodwill associated with any of our reporting units or impairment charges related to certain of our products or other intangible assets;
•the risks and uncertainties relating to acquisitions and other business development transactions we may pursue, seek to complete and/or complete, including risks that pending transactions may not close, risks that we may not realize the expected benefits of such acquisitions and transactions on a timely basis or at all, risks that pipeline products acquired may not be commercialized as anticipated, and risks relating to any increased levels of debt as a result of debt incurred to finance certain of these acquisitions and transactions;
•the uncertainties associated with the acquisition and launch of new products, assets and businesses, including, but not limited to, our ability to provide the time, resources, expertise and funds required for the commercial launch of new products, the acceptance and demand for new products, the failure to obtain required regulatory approvals, clearances or authorizations, and the impact of competitive products and pricing, which could lead to material impairment charges;
•our ability or inability to extend the profitable life of our products, including through line extensions and other life-cycle programs;
iv
•our ability to retain, motivate and recruit executives and other key employees;
•our ability to implement effective succession planning for our executives and other key employees;
•factors impacting our ability to achieve anticipated revenues for our products, including changes in anticipated marketing spend on such products and launch of competing products;
•factors impacting our ability to achieve anticipated market acceptance for our products, including the pricing of such products, effectiveness of promotional efforts, reputation of our products and launch of competing products;
•our ability to compete against companies that are larger and have greater financial, technical and human resources than we do, as well as other competitive factors, such as technological advances achieved, patents obtained and new products introduced by our competitors;
•the extent to which our products are reimbursed by government authorities, pharmacy benefit managers (“PBMs”) and other third-party payors; the impact our distribution, pricing and other practices may have on the decisions of such government authorities, PBMs and other third-party payors to reimburse our products; and the impact of obtaining or maintaining such reimbursement on the price and sales of our products;
•the inclusion of our products on formularies or our ability to achieve favorable formulary status, as well as the impact on the price and sales of our products in connection therewith;
•the consolidation of wholesalers, retail drug chains and other customer groups and the impact of such industry consolidation on our business;
•our ability to maintain strong relationships with physicians and other health care professionals;
•our eligibility for benefits under tax treaties and the continued availability of low effective tax rates for the business profits of certain of our subsidiaries;
•the implementation of the Organisation for Economic Co-operation and Development inclusive framework on Base Erosion and Profit Shifting, including the global minimum corporate tax rate, by the countries in which we operate, and the potential impact of protective measures proposed by the United States in response to the inclusive framework, including the Trump administration’s executive order and the agreement in principle among the United States and the other G7 countries, and any changes in tax laws by non-U.S. countries in response thereto;
•the impacts of the new legislation commonly referred to as One Big Beautiful Bill Act, including the effects on the Company’s tax provision for both 2026 and future years;
•the actions of our third-party partners or service providers of research, development, manufacturing, marketing, distribution or other services, including their compliance with applicable laws and contracts, which actions may be beyond our control or influence, and the impact of such actions on us;
•the risks associated with the international scope of our operations, including our presence in emerging markets and the challenges we face when entering and operating in new and different geographic markets (including the challenges created by new and different regulatory regimes in such countries and the need to comply with applicable anti-bribery and economic sanctions, laws and regulations);
•adverse global economic conditions and credit markets and foreign currency exchange uncertainty and volatility in certain of the countries in which we do business;
•political and economic instability and other ongoing uncertainties as a result of unrest, instability or changes in geopolitical conditions, including military or political conflicts, in or impacting the countries in which we do business;
•risks associated with the ongoing conflict between Russia and Ukraine and the export controls, sanctions and other restrictive actions that have been or may be imposed by the United States, Canada, the EU and other countries against governmental and other entities and individuals in or associated with Russia, Belarus and parts of Ukraine, including its potential escalation and the potential impact on sales, earnings, market conditions and the ability of the Company to manage resources and historical investment in Russia;
•risks associated with the conflict between the U.S. and Israel and Iran and Iran-backed militant groups and the related unrest in the Middle East region, and the potential impact on our operations, sale of products and revenues in this region, as well as the potential macroeconomic impact of such conflict and related unrest (including fuel prices), which could adversely impact our operations, revenues, expenses and resulting margins;
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•our ability to obtain, maintain and license sufficient intellectual property rights over our products and enforce and defend against challenges to such intellectual property;
•the introduction of generic, biosimilar or other competitors of our branded products and other products, including the introduction of products that compete against our products that do not have patent or data exclusivity rights;
•the expense, timing and outcome of pending or future legal and governmental proceedings, arbitrations, investigations, subpoenas, tax and other regulatory audits, examinations, reviews, inspections and regulatory proceedings against us or relating to us and settlements thereof;
•our ability to obtain components, raw materials or finished products supplied by third parties (some of which may be single-sourced) and other manufacturing and related supply difficulties, interruptions and delays;
•the disruption of delivery of our products and the routine flow of manufactured goods;
•potential work stoppages, slowdowns or other labor problems at our facilities and the resulting impact on our manufacturing, distribution and other operations;
•interest rate risks associated with our floating rate debt borrowings;
•our ability to effectively distribute our products and the effectiveness and success of our distribution arrangements;
•our ability to effectively promote our own products and those of our co-promotion partners;
•our ability to secure and maintain third-party research, development, manufacturing, licensing, marketing or distribution arrangements;
•the risk that our products could cause, or be alleged to cause, personal injury and adverse effects, leading to potential lawsuits, product liability claims and damages and/or recalls or withdrawals of products from the market;
•the mandatory or voluntary recall or withdrawal of our products from the market and the costs associated therewith;
•the availability of, and our ability to obtain and maintain, adequate insurance coverage and/or our ability to cover or insure against the total amount of the claims and liabilities we face, whether through third-party insurance or self-insurance;
•our indemnity agreements, which may result in an obligation to indemnify or reimburse the relevant counterparty, which amounts may be material;
•the difficulty in predicting the expense, timing and outcome within our legal and regulatory environment, including with respect to approvals by the FDA, Health Canada, the European Medicines Agency (“EMA”) and similar agencies in other jurisdictions, legal and regulatory proceedings and settlements thereof, the protection afforded by our patents and other intellectual and proprietary property, successful generic challenges to our products and infringement or alleged infringement of the intellectual property of others;
•the results of continuing safety and efficacy studies by industry and government agencies;
•the success of preclinical and clinical trials for our drug development pipeline or delays in clinical trials that adversely impact the timely commercialization of our pipeline products, as well as other factors impacting the commercial success of our products, which could lead to material impairment charges;
•uncertainties around the successful improvement and modification of our existing products and development of new products, which may require significant expenditures and efforts;
•the results of management reviews of our research and development portfolio (including following the receipt of clinical results or feedback from the FDA or other regulatory authorities), which could result in terminations of specific projects which, in turn, could lead to material impairment charges;
•the seasonality of sales of certain of our products;
•declines in the pricing and sales volume of certain of our products that are distributed or marketed by third parties, over which we have no or limited control;
•compliance by us or our third-party partners and service providers (over whom we may have limited influence), or the failure by us or these third parties to comply, with health care “fraud and abuse” laws and other extensive regulation of our marketing, promotional and business practices (including with respect to pricing), worldwide anti-
vi
bribery laws (including the U.S. Foreign Corrupt Practices Act and the Canadian Corruption of Foreign Public Officials Act), worldwide economic sanctions and/or export laws, worldwide environmental laws and regulation and privacy and security regulations;
•the impact of any changes in or reforms to the legislation, laws, rules, regulation and guidance that apply to us and our businesses and products or the enactment of any new or proposed legislation, laws, rules, regulations or guidance that will impact or apply to us or our businesses or products;
•the impact of changes in federal laws and policy that have been and may be undertaken under the Trump administration;
•illegal distribution or sale of counterfeit versions of our products;
•our ability to adopt and integrate artificial intelligence solutions into various aspects of our business and operations responsibly and in compliance with applicable legislation, laws, rules, regulation and guidance;
•interruptions, breakdowns or breaches in our information technology systems; and
•risks in Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the U.S. Securities and Exchange Commission (“SEC”) and the Canadian Securities Administrators (the “CSA”) on February 18, 2026 and risks detailed from time to time in our other filings with the SEC and the CSA, as well as our ability to anticipate and manage the risks associated with the foregoing.
Additional information about these factors and about the material factors or assumptions underlying such forward-looking statements may be found in our Annual Report on Form 10-K for the year ended December 31, 2025, filed on February 18, 2026, under Item 1A. “Risk Factors”, under Item 1A. “Risk Factors” of Part II of this Form 10-Q and in the Company’s other filings with the SEC and the CSA. When relying on our forward-looking statements to make decisions with respect to the Company, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. These forward-looking statements speak only as of the date made. We undertake no obligation to update or revise any of these forward-looking statements to reflect events or circumstances after the date of this Form 10-Q or to reflect actual outcomes, except as required by law. We caution that, as it is not possible to predict or identify all relevant factors that may impact forward-looking statements, the foregoing list of important factors that may affect future results is not exhaustive and should not be considered a complete statement of all potential risks and uncertainties.
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
BAUSCH + LOMB CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions, except share amounts)
(Unaudited)
| September 30, 2026 | December 31, 2025 | |||||||||||||
| Assets | ||||||||||||||
| Current assets: | ||||||||||||||
| Cash and cash equivalents | $ | $ | ||||||||||||
| Restricted cash | ||||||||||||||
| Trade receivables, net | ||||||||||||||
| Inventories, net | ||||||||||||||
| Prepaid expenses and other current assets (Note 4) | ||||||||||||||
| Total current assets | ||||||||||||||
| Property, plant and equipment, net | ||||||||||||||
| Intangible assets, net | ||||||||||||||
| Goodwill | ||||||||||||||
| Deferred tax assets, net | ||||||||||||||
| Other non-current assets (Note 4) | ||||||||||||||
| Total assets | $ | $ | ||||||||||||
| Liabilities | ||||||||||||||
| Current liabilities: | ||||||||||||||
| Accounts payable (Note 4) | $ | $ | ||||||||||||
| Accrued and other current liabilities | ||||||||||||||
| Current portion of long-term debt and other financial liabilities | ||||||||||||||
| Total current liabilities | ||||||||||||||
| Deferred tax liabilities, net | ||||||||||||||
| Other non-current liabilities | ||||||||||||||
| Long-term debt and other financial liabilities | ||||||||||||||
| Total liabilities | ||||||||||||||
Commitments and contingencies (Note 16) | ||||||||||||||
| Equity | ||||||||||||||
Common shares, no par value, unlimited shares authorized, | ||||||||||||||
Additional paid-in capital | ||||||||||||||
Accumulated deficit | ( | ( | ||||||||||||
| Accumulated other comprehensive loss | ( | ( | ||||||||||||
Total Bausch + Lomb Corporation shareholders’ equity | ||||||||||||||
| Noncontrolling interest | ||||||||||||||
| Total equity | ||||||||||||||
| Total liabilities and equity | $ | $ | ||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
1
BAUSCH + LOMB CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share amounts)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Revenues | |||||||||||||||||||||||
| Product sales | $ | $ | $ | $ | |||||||||||||||||||
| Other revenues | |||||||||||||||||||||||
| Expenses | |||||||||||||||||||||||
Cost of goods sold (excluding amortization and impairments of intangible assets) | |||||||||||||||||||||||
| Cost of other revenues | |||||||||||||||||||||||
| Selling, general and administrative (Note 4) | |||||||||||||||||||||||
| Research and development | |||||||||||||||||||||||
| Amortization of intangible assets | |||||||||||||||||||||||
| Other expense (income), net | ( | ||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||
| Interest income | |||||||||||||||||||||||
| Interest expense | ( | ( | ( | ( | |||||||||||||||||||
| Gain (loss) on extinguishment of debt | ( | ( | |||||||||||||||||||||
| Foreign exchange and other | ( | ( | ( | ( | |||||||||||||||||||
| Income (loss) before provision for income taxes | ( | ( | ( | ||||||||||||||||||||
| (Provision for) benefit from income taxes | ( | ( | ( | ||||||||||||||||||||
| Net income (loss) | ( | ( | ( | ||||||||||||||||||||
| Net income attributable to noncontrolling interest | ( | ( | ( | ( | |||||||||||||||||||
| Net income (loss) attributable to Bausch + Lomb Corporation | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
| Basic and diluted income (loss) per share attributable to Bausch + Lomb Corporation | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
| Basic weighted-average common shares | |||||||||||||||||||||||
| Diluted weighted-average common shares | |||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
2
BAUSCH + LOMB CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(in millions)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Net income (loss) | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
| Other comprehensive (loss) income | |||||||||||||||||||||||
| Foreign currency translation adjustment | ( | ( | ( | ||||||||||||||||||||
| Other comprehensive (loss) income | ( | ( | ( | ||||||||||||||||||||
| Comprehensive income (loss) | ( | ( | ( | ||||||||||||||||||||
| Comprehensive income attributable to noncontrolling interest | ( | ( | ( | ( | |||||||||||||||||||
| Comprehensive income (loss) attributable to Bausch + Lomb Corporation | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
3
BAUSCH + LOMB CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
(in millions)
(Unaudited)
| Additional Paid in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Bausch + Lomb Corporation Shareholders’ Equity | Non-controlling Interest | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Three Months Ended September 30, 2026 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balances, July 1, 2026 | $ | $ | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common shares issued under share-based compensation plans | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Employee withholding taxes related to share-based awards | — | — | ( | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances, September 30, 2026 | $ | $ | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Three Months Ended September 30, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balances, July 1, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common shares issued under share-based compensation plans | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Employee withholding taxes related to share-based awards | — | — | ( | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net (loss) income | — | — | — | ( | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances, September 30, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Nine Months Ended September 30, 2026 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balances, January 1, 2026 | $ | $ | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common shares issued under share-based compensation plans | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Employee withholding taxes related to share-based awards | — | — | ( | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Noncontrolling interest distributions | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net (loss) income | — | — | — | ( | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive (loss) income | — | — | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances, September 30, 2026 | $ | $ | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Nine Months Ended September 30, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balances, January 1, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common shares issued under share-based compensation plans | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Employee withholding taxes related to share-based awards | — | — | ( | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Noncontrolling interest distributions | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net (loss) income | — | — | — | ( | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances, September 30, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
4
BAUSCH + LOMB CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(Unaudited)
| Nine Months Ended September 30, | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| Cash Flows From Operating Activities | ||||||||||||||
| Net loss | $ | ( | $ | ( | ||||||||||
| Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||||||||
| Depreciation and amortization of intangible assets | ||||||||||||||
| Amortization and write-off of debt premiums, discounts and issuance costs | ||||||||||||||
| Asset impairments | ||||||||||||||
| Acquisition-related contingent consideration | ( | |||||||||||||
| Allowances for losses on trade receivables and inventories | ||||||||||||||
| Deferred income taxes | ( | ( | ||||||||||||
| Gain on sale of assets | ( | ( | ||||||||||||
| Additions of accrued legal settlements | ||||||||||||||
| Share-based compensation | ||||||||||||||
| Foreign exchange loss | ||||||||||||||
| Gain excluded from hedge effectiveness | ( | ( | ||||||||||||
| Loss on extinguishment of debt | ||||||||||||||
| Amortization of inventory step-up resulting from acquisitions | ||||||||||||||
| Other | ( | |||||||||||||
| Changes in operating assets and liabilities: | ||||||||||||||
| Trade receivables | ( | |||||||||||||
| Inventories | ( | |||||||||||||
| Prepaid expenses and other current assets | ( | ( | ||||||||||||
| Accounts payable, accrued and other liabilities | ||||||||||||||
| Net cash provided by operating activities | ||||||||||||||
| Cash Flows From Investing Activities | ||||||||||||||
| Acquisitions and other investments | ( | ( | ||||||||||||
| Purchases of property, plant and equipment | ( | ( | ||||||||||||
| Purchases of marketable securities | ( | ( | ||||||||||||
| Proceeds from sale of marketable securities | ||||||||||||||
| Proceeds from sale of assets and businesses, net of costs to sell | ||||||||||||||
| Interest settlements from cross-currency swaps | ||||||||||||||
| Net cash used in investing activities | ( | ( | ||||||||||||
| Cash Flows From Financing Activities | ||||||||||||||
| Issuance of debt, net of discounts, and other financial liabilities | ||||||||||||||
| Repayments of debt and other financial liabilities | ( | ( | ||||||||||||
| Payment of employee withholding taxes related to share-based awards | ( | ( | ||||||||||||
| Proceeds from exercise of stock options | ||||||||||||||
| Payments of financing costs | ( | |||||||||||||
| Payments of noncontrolling interest distributions | ( | ( | ||||||||||||
| Other | ( | |||||||||||||
| Net cash (used in) provided by financing activities | ( | |||||||||||||
| Effect of exchange rate changes on cash and cash equivalents and restricted cash | ( | |||||||||||||
| Net increase in cash and cash equivalents and restricted cash | ||||||||||||||
| Cash and cash equivalents and restricted cash, beginning of period | ||||||||||||||
| Cash and cash equivalents and restricted cash, end of period | $ | $ | ||||||||||||
| Non-cash Investing Activities | ||||||||||||||
| Accrued purchases of property, plant and equipment | $ | $ | ||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
5
BAUSCH + LOMB CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1.DESCRIPTION OF BUSINESS
Overview
Bausch + Lomb Corporation (“Bausch + Lomb” or the “Company”) is a leading global eye health company dedicated to protecting and enhancing the gift of sight for millions of people around the world – from the moment of birth through every phase of life. The Company operates in three
Bausch + Lomb is a subsidiary of Bausch Health Companies Inc. (“BHC”), with BHC directly or indirectly holding 310,449,643 Bausch + Lomb common shares, which represents approximately 87 % of the issued and outstanding common shares of Bausch + Lomb, as of October 21, 2026. On August 6, 2020, BHC announced its plan to separate our eye health business into an independent publicly traded entity, separate from the remainder of BHC (the “Separation”). This resulted in the initial public offering of Bausch + Lomb (the “B+L IPO”), and our common shares began trading on the New York Stock Exchange and the Toronto Stock Exchange, in each case under the ticker symbol “BLCO”, on May 6, 2022.
The Company understands that BHC continues to evaluate all relevant factors and considerations relating to its investment in Bausch + Lomb, including any completion of the full Separation. However, there can be no assurance that the Separation will be consummated, the form any such consummated Separation would take or that, even if consummated, we will realize the anticipated benefits from the Separation.
6
2.SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The unaudited financial statements for all periods presented are referred to as “Condensed Consolidated Financial Statements”, and have been prepared by the Company in United States (“U.S.”) dollars and in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial reporting and pursuant to the rules and regulations for reporting on Form 10-Q, which do not conform in all respects to the requirements of U.S. GAAP for annual financial statements. Accordingly, certain information and disclosures required by U.S. GAAP for complete Consolidated Financial Statements are not included herein. Accordingly, these notes to the unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements prepared in accordance with U.S. GAAP that are contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed with the U.S. Securities and Exchange Commission (“SEC”) and the Canadian Securities Administrators (the “CSA”) on February 18, 2026. The unaudited Condensed Consolidated Financial Statements have been prepared using accounting policies that are consistent with the policies used in preparing the Company’s audited Consolidated Financial Statements for the year ended December 31, 2025. The unaudited Condensed Consolidated Financial Statements reflect all normal and recurring adjustments necessary for a fair statement of the Company’s financial position and results of operations for the interim periods. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full year.
Use of Estimates
In preparing the unaudited Condensed Consolidated Financial Statements, management is required to make estimates and assumptions. The estimates and assumptions used by the Company affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.
All estimates in these Condensed Consolidated Financial Statements are based on assumptions that management believes are reasonable. On an ongoing basis, management reviews its estimates to ensure that these estimates appropriately reflect changes in the Company’s business and new information as it becomes available. If historical experience and other factors used by management to make these estimates do not reasonably reflect future activity, the Company’s business, financial condition, cash flows and results of operations could be materially impacted.
Adoption of New Accounting Standards
In July 2025, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides guidance for estimating credit losses under the current expected credit losses (CECL) model for current accounts receivable and current contract assets arising from transactions accounted for under Accounting Standards Codification 606. As of January 1, 2026, the Company has adopted this ASU on a prospective basis, and it did not have a material impact on its consolidated financial statements and related disclosures.
Recently Issued Accounting Standards, Not Adopted as of September 30, 2026
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires disclosure of specified information about certain costs and expenses. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting this ASU on its disclosures.
In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. This ASU amends the existing standard to remove all references to software development project stages and requires entities to start capitalizing software costs when both of the following occur: (i) management has authorized and committed to funding the software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. This ASU is effective for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years, with early adoption permitted as of the beginning of a fiscal year. The amendments can be applied prospectively, retrospectively, or via a modified prospective transition method. The Company is evaluating the impact of adoption on its consolidated financial statements and related disclosures.
7
3.REVENUE RECOGNITION
Revenue Recognition
The Company’s revenues are primarily generated from product sales in the therapeutic areas of eye health that consist of: (i) branded prescription eye-medications and pharmaceuticals, (ii) generic and branded generic prescription eye medications and pharmaceuticals, (iii) OTC vitamin and supplement products and (iv) medical devices (contact lenses, IOLs and ophthalmic surgical equipment). Other revenues include alliance and service revenue from the licensing and co-promotion of products and contract service revenue. Contract service revenue is derived primarily from contract manufacturing for third parties and is not material. See Note 17, “SEGMENT INFORMATION” for the disaggregation of revenues.
The Company recognizes revenue when the customer obtains control of promised goods or services and in an amount that reflects the consideration to which the Company expects to be entitled to receive in exchange for those goods or services. To achieve this core principle, the Company applies the five-step revenue model to contracts within its scope: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation.
Product Sales
A contract with the Company’s customers exists for each product sale. Where a contract with a customer contains more than one performance obligation, the Company allocates the transaction price to each distinct performance obligation based on its relative standalone selling price. The transaction price is adjusted for variable consideration which is discussed further below. The Company recognizes revenue for product sales at a point in time, when the customer obtains control of the products in accordance with contracted delivery terms, which is generally upon shipment or customer receipt. Contracted delivery terms will vary by customer and geography. In the U.S., control is generally transferred to the customer upon receipt.
Revenue from sales of surgical equipment and related software is generally recognized upon delivery and installation of the equipment. IOLs and delivery systems, disposable surgical packs and other surgical instruments are distinct from the surgical equipment and may be sold together with the surgical equipment in a single contract or on a standalone basis. Revenue from the sale of delivery systems, disposable surgical packs and other surgical instruments is recognized in accordance with the contracted delivery terms, generally upon shipment or customer receipt. IOLs are sold primarily on a consignment basis and revenue is recognized upon notification of use.
When a sale transaction in the Surgical segment contains multiple performance obligations, the transaction price is allocated to each performance obligation based on the relative standalone sales price and revenue is recognized upon satisfaction of each performance obligation.
Product Sales Provisions
As is customary in the eye health industry, gross product sales of certain product categories are subject to a variety of deductions in arriving at reported net product sales. The transaction price for such product categories is typically adjusted for variable consideration, which may be in the form of cash discounts, allowances, returns, rebates, chargebacks and distribution fees paid to customers. Provisions for variable consideration are established to reflect the Company’s best estimates of the amount of consideration to which it is entitled based on the terms of the contract. The amount of variable consideration included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in the future period.
Provisions for these deductions are recorded concurrently with the recognition of gross product sales revenue and include cash discounts and allowances, chargebacks and distribution fees, which are paid to direct customers, as well as rebates and returns, which can be paid to direct and indirect customers. Returns provision balances and volume discounts to direct customers are included in Accrued and other current liabilities. All other provisions related to direct customers are included in Trade receivables, net, while provision balances related to indirect customers are included in Accrued and other current liabilities.
8
The following tables present the activity and ending balances of the Company’s variable consideration provisions for the nine months ended September 30, 2026 and 2025:
| Nine Months Ended September 30, 2026 | ||||||||||||||||||||||||||||||||||||||
| (in millions) | Discounts and Allowances | Returns | Rebates | Chargebacks | Distribution Fees | Total | ||||||||||||||||||||||||||||||||
| Reserve balance, January 1, 2026 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Current period provision | ||||||||||||||||||||||||||||||||||||||
| Payments and credits | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||
Reserve balance, September 30, 2026 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Included in Rebates in the table above are cooperative advertising credits due to customers of approximately $37 million and $26 million as of September 30, 2026 and January 1, 2026, respectively, which are reflected as a reduction of Trade receivables, net in the Condensed Consolidated Balance Sheets.
| Nine Months Ended September 30, 2025 | ||||||||||||||||||||||||||||||||||||||
| (in millions) | Discounts and Allowances | Returns | Rebates | Chargebacks | Distribution Fees | Total | ||||||||||||||||||||||||||||||||
| Reserve balance, January 1, 2025 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Current period provision | ||||||||||||||||||||||||||||||||||||||
| Payments and credits | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||
Reserve balance, September 30, 2025 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Included in Rebates in the table above are cooperative advertising credits due to customers of approximately $33 million and $32 million as of September 30, 2025 and January 1, 2025, respectively, which are reflected as a reduction of Trade receivables, net in the Condensed Consolidated Balance Sheets. For the nine months ended September 30, 2025, included in Payments and credits in the table above, are payments made, or to be made, by Novartis, on behalf of the Company for Rebates, in accordance with the agreements associated with the 2023 acquisition of XIIDRA® (lifitegrast ophthalmic solution) and certain other ophthalmology assets.
Contract Assets and Contract Liabilities
There are no contract assets for any period presented. Contract liabilities consist of deferred revenue, the balance of which is not material to any period presented.
Allowance for Credit Losses
An allowance is maintained for potential credit losses. The Company estimates the current expected credit loss on its receivables based on various factors, including historical credit loss experience, customer creditworthiness, value of collaterals (if any), and any relevant current economic factors. Additionally, the Company generally estimates the expected credit loss on a pooled basis when customers are deemed to have similar risk characteristics. Trade receivable balances are written off against the allowance when it is deemed probable that the trade receivable will not be collected. Trade receivables, net are stated net of certain sales provisions and the allowance for credit losses.
The activity in the allowance for credit losses for trade receivables for the nine months ended September 30, 2026 and 2025 is as follows:
| Nine Months Ended September 30, | |||||||||||
| (in millions) | 2026 | 2025 | |||||||||
| Balance, beginning of period | $ | $ | |||||||||
| Provision | |||||||||||
| Write-offs | ( | ( | |||||||||
| Foreign exchange and other | |||||||||||
| Balance, end of period | $ | $ | |||||||||
9
4.RELATED PARTIES
Prior to May 10, 2022, Bausch + Lomb had been managed and operated in the ordinary course of business with other affiliates of BHC. On May 10, 2022, Bausch + Lomb became an independent publicly traded company. As of October 21, 2026, BHC directly or indirectly held 310,449,643 common shares of Bausch + Lomb, which represented approximately 87 % of the issued and outstanding common shares of Bausch + Lomb.
Additionally, there have been no sales made to related parties for all periods presented.
Accounts Receivable and Payable
Certain transactions between Bausch + Lomb and BHC and affiliate businesses are cash-settled on a current basis and, therefore, are reflected in the Condensed Consolidated Balance Sheets. Amounts payable to BHC and its affiliates related to related party transactions were $5 million and $14 million as of September 30, 2026 and December 31, 2025, respectively, and are included within Accounts payable in the Condensed Consolidated Balance Sheets. Amounts due from BHC and its affiliates related to related party transactions were $7 million and $8 million as of September 30, 2026 and December 31, 2025, respectively, of which $0 and $1 million are included within Prepaid expenses and other current assets and $7 million and $7 million are included within Other non-current assets on the Condensed Consolidated Balance Sheets as of September 30, 2026 and December 31, 2025, respectively. These amounts are inclusive of the receivables and payables associated with the separation agreements entered into in connection with the B+L IPO, as discussed below.
Separation Agreement with BHC
In connection with the completion of the B+L IPO, the Company entered into a Master Separation Agreement (the “MSA”), that, together with the other agreements summarized herein, govern the relationship between BHC and the Company following the completion of the B+L IPO.
Other agreements that the Company entered into with BHC that govern aspects of Bausch + Lomb’s relationship with BHC following the B+L IPO include:
•Transition Services Agreement – In connection with the completion of the B+L IPO, Bausch + Lomb has entered into the TSA with BHC to provide each other, on a transitional basis, certain administrative, human resources, treasury and support services and other assistance, for a limited time to help ensure an orderly transition following the B+L IPO. The TSA specifies the calculation of Bausch + Lomb costs and receipts for these services. Under the TSA, Bausch + Lomb has received certain services from BHC, including information technology services, technical and engineering support, application support for operations, legal, payroll, finance, tax and accounting, general administrative services and other support services, and has also provided certain similar services to BHC. Individual services provided under the TSA have been scheduled for a specific period, generally ranging from to twelve months , depending on the nature of the services. As of the date of this filing, most of these transitional services have either expired or been terminated; however, a limited number of these transitional services are still being provided by the parties.
•Tax Matters Agreement – In connection with the completion of the B+L IPO, Bausch + Lomb has entered into a Tax Matters Agreement (as amended, the “Tax Matters Agreement”) with BHC that governs the parties’ respective rights, responsibilities and obligations with respect to tax liabilities and benefits, tax attributes, the preparation and filing of tax returns, the control of audits and other tax proceedings and other matters regarding taxes following the B+L IPO.
•Employee Matters Agreement – In connection with the completion of the B+L IPO, Bausch + Lomb has entered into an Employee Matters Agreement with BHC that governs, among other things, the allocation of employee-related liabilities, the mechanics for the transfer of Bausch + Lomb employees, the treatment of outstanding BHC equity awards solely in connection with the Distribution and the treatment of Bausch + Lomb employees’ participation in BHC’s retirement and health and welfare plans. On July 31, 2024, Bausch + Lomb and BHC entered into an Amended and Restated Employee Matters Agreement which, among other things, sets forth revised terms for the treatment of certain BHC equity awards solely in connection with the Distribution.
In addition to the previously discussed agreements, Bausch + Lomb has entered into certain other agreements with BHC including, but not limited to, the Intellectual Property Matters Agreement and the Real Estate Matters Agreement that provide a framework for the ongoing relationship with BHC.
10
5.ACQUISITIONS
2026 Acquisitions
On October 8, 2026, the Company entered into an agreement to acquire certain ophthalmic surgical manufacturing businesses. This transaction is expected to increase the Company’s future margins. The acquisition is expected to close during the fourth quarter of 2026 for an upfront cash payment of approximately $85 million, due at closing.
2025 Acquisitions
Acquisition of Manufacturing Equipment
On December 9, 2025, the Company, through its affiliates, completed a transaction to acquire certain manufacturing equipment, other assets and the assumption of a manufacturing facility lease in Mexico, for an upfront cash payment of approximately $75 million and potential future milestone payments of up to $35 million. The acquisition is expected to unlock manufacturing capacity and expand the Company's margins.
This acquisition has been accounted for as a business combination under the acquisition method of accounting. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed, as of the acquisition date:
| (in millions) | ||||||||
| Property, plant and equipment, net | $ | |||||||
| Intangible assets, net | ||||||||
| Total identifiable assets | ||||||||
| Goodwill | ||||||||
| Total fair value of consideration transferred | $ | |||||||
The assets acquired and liabilities assumed are included within the Company's Surgical segment. Goodwill associated with this acquisition represents potential future synergies and is deductible for income tax purposes.
The valuation of the assets acquired and liabilities assumed, as part of this acquisition, has not yet been finalized as of September 30, 2026. The Company will finalize these amounts no later than one year from the acquisition date.
Revenues and operating results associated with this acquisition during the period from December 9, 2025 through December 31, 2025 were not material. Pro forma revenues and operating results for the years 2025 and 2024 were not material.
Other Acquisitions
During November 2025, the Company completed two acquisitions. These acquisitions have been accounted for as business combinations under the acquisition method of accounting and the aggregate cash consideration of approximately $33 million was allocated to the assets acquired and liabilities assumed as of the acquisition dates, which primarily consisted of $30 million of goodwill, in the aggregate.
Acquisition of Whitecap Biosciences
On January 3, 2025, the Company, through its affiliate, acquired Whitecap Biosciences, LLC, (“Whitecap Biosciences”) for an upfront payment of approximately $28 million and potential future milestone and royalty payments. The Company accounted for the transaction as an asset acquisition and, during 2025, the Company expensed the upfront payment of approximately $28 million as acquired in-process research development costs, as included within Other expense on the Condensed Consolidated Statements of Operations. In July 2026, the Company announced that the Phase 2 study regarding Whitecap Biosciences' glaucoma neuroprotective candidate did not meet its primary endpoint and, as such, the Company will no longer advance this program, and, instead, will now focus on (in respect of Whitecap Biosciences) developing the first small-molecule sustained-release implant for geographic atrophy.
6.FAIR VALUE MEASUREMENTS
Fair value measurements are estimated based on valuation techniques and inputs categorized as follows:
•Level 1 — Quoted prices in active markets for identical assets or liabilities;
•Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and
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•Level 3 — Unobservable inputs that are supported by little or no market activity and that are financial instruments whose values are determined using discounted cash flow methodologies, pricing models, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.
If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following fair value hierarchy table presents the components and classification of the Company’s financial assets and liabilities measured at fair value on a recurring basis:
| September 30, 2026 | December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | Carrying Value | Level 1 | Level 2 | Level 3 | Carrying Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Cash equivalents | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition-related contingent consideration | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
| Foreign currency exchange contracts | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
| Cross-currency swaps | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Cash equivalents consist of highly liquid investments, primarily money market funds, with maturities of three months or less when purchased, and are reflected in the Condensed Consolidated Balance Sheets at carrying value, which approximates fair value due to their short-term nature.
There were no transfers into or out of Level 3 during the nine months ended September 30, 2026 and 2025.
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Cross-currency Swaps
The Company uses cross-currency swaps to mitigate fluctuation in the value of a portion of its euro-denominated net investment in its Condensed Consolidated Financial Statements from fluctuation in exchange rates. The euro-denominated net investment being hedged is the Company’s investment in certain euro-denominated subsidiaries. As of September 30, 2026, these swaps had an aggregate notional value of $1,000 million.
The assets and liabilities associated with the Company’s cross-currency swaps as included in the Condensed Consolidated Balance Sheets are as follows:
| (in millions) | September 30, 2026 | December 31, 2025 | |||||||||
| Other non-current liabilities | $ | $ | |||||||||
| Prepaid expenses and other current assets | $ | $ | |||||||||
| Net fair value | $ | $ | |||||||||
The following table presents the effect of hedging instruments on the Condensed Consolidated Statements of Comprehensive Income (Loss) and the Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2026 and 2025:
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Gain (loss) recognized in Other comprehensive (loss) income | $ | $ | $ | $ | ( | ||||||||||||||||||
| Gain excluded from assessment of hedge effectiveness | $ | $ | $ | $ | |||||||||||||||||||
| Location of gain of excluded component | Interest expense | Interest expense | |||||||||||||||||||||
No portion of the cross-currency swaps were ineffective for the nine months ended September 30, 2026 and 2025. The Company received $9 million and $12 million in interest settlements for the nine months ended September 30, 2026 and 2025, respectively, which are reported as investing activities in the Condensed Consolidated Statements of Cash Flows.
Foreign Currency Exchange Contracts
The Company enters into foreign currency exchange contracts to economically hedge the foreign exchange exposure on certain of the Company’s intercompany balances. As of September 30, 2026, these contracts had an aggregate notional amount of $194 million.
The assets and liabilities associated with the Company’s foreign exchange contracts as included in the Condensed Consolidated Balance Sheets as of September 30, 2026 and December 31, 2025 are as follows:
| (in millions) | September 30, 2026 | December 31, 2025 | |||||||||
| Accrued and other current liabilities | $ | $ | |||||||||
| Prepaid expenses and other current assets | $ | $ | |||||||||
| Net fair value | $ | $ | |||||||||
The following table presents the effect of the Company’s foreign exchange contracts on the Condensed Consolidated Statements of Operations and the Condensed Consolidated Statements of Cash Flows for the three and nine months ended September 30, 2026 and 2025:
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| (Loss) gain related to changes in fair value | $ | ( | $ | $ | $ | ( | |||||||||||||||||
| Loss related to settlements | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Acquisition-related Contingent Consideration Obligations
Acquisition-related contingent consideration, which primarily consists of potential milestone payments, is recorded in the Condensed Consolidated Balance Sheets at its acquisition date estimated fair value, in accordance with the acquisition
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method of accounting. The fair value of the acquisition-related contingent consideration is remeasured each reporting period, with changes in fair value recorded in the Condensed Consolidated Statements of Operations. The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in fair value measurement accounting.
The fair value measurement of contingent consideration obligations arising from business combinations is determined via a probability-weighted discounted cash flow analysis, using unobservable (Level 3) inputs. These inputs may include: (i) the estimated amount and timing of projected cash flows, (ii) the probability of the achievement of the factor(s) on which the contingency is based and (iii) the risk-adjusted discount rate used to present value the probability-weighted cash flows. Significant increases or decreases in any of those inputs in isolation could result in a significantly higher or lower fair value measurement. At September 30, 2026, the fair value measurements of acquisition-related contingent consideration were determined using risk-adjusted discount rates ranging from 8 % to 16 %, and a weighted average risk-adjusted discount rate of 9 %. The weighted average risk-adjusted discount rate was calculated by weighting each contract’s relative fair value at September 30, 2026.
The following table presents a reconciliation of contingent consideration obligations measured on a recurring basis using significant unobservable inputs (Level 3) for the nine months ended September 30, 2026 and 2025:
| (in millions) | 2026 | 2025 | |||||||||||||||
| Balance, as of January 1, | $ | $ | |||||||||||||||
| Adjustments to Acquisition-related contingent consideration: | |||||||||||||||||
| Accretion for the time value of money | $ | $ | |||||||||||||||
| Fair value adjustments due to changes in estimates of future payments | ( | ||||||||||||||||
| ( | |||||||||||||||||
| Additions | |||||||||||||||||
Balance, as of September 30, | |||||||||||||||||
| Current portion included in Accrued and other current liabilities | |||||||||||||||||
| Non-current portion | $ | $ | |||||||||||||||
Fair Value of Long-term Debt
The fair value of long-term debt as of September 30, 2026 and December 31, 2025 was $5,091 million and $5,201 million, respectively, and was estimated using the quoted market prices for the same or similar debt issuances (Level 2).
7.INVENTORIES
Inventories, net consist of:
| (in millions) | September 30, 2026 | December 31, 2025 | ||||||||||||
| Raw materials | $ | $ | ||||||||||||
| Work in process | ||||||||||||||
| Finished goods | ||||||||||||||
| $ | $ | |||||||||||||
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8.INTANGIBLE ASSETS AND GOODWILL
Intangible Assets
The major components of intangible assets consist of:
| September 30, 2026 | December 31, 2025 | ||||||||||||||||||||||||||||||||||
| (in millions) | Gross Carrying Amount | Accumulated Amortization and Impairments | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization and Impairments | Net Carrying Amount | |||||||||||||||||||||||||||||
Finite-lived intangible assets: | |||||||||||||||||||||||||||||||||||
| Product brands | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
| Corporate brands | ( | ( | |||||||||||||||||||||||||||||||||
| Product rights/patents | ( | ( | |||||||||||||||||||||||||||||||||
| Other | ( | ( | |||||||||||||||||||||||||||||||||
| Total finite-lived intangible assets | ( | ( | |||||||||||||||||||||||||||||||||
| Acquired in-process research and development intangible asset | — | — | |||||||||||||||||||||||||||||||||
| B&L Trademark | — | — | |||||||||||||||||||||||||||||||||
| $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
Long-lived assets with finite lives are tested for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Impairment charges associated with these assets are included in Other expense, net in the Condensed Consolidated Statements of Operations. Bausch + Lomb continues to monitor the recoverability of its finite-lived intangible assets and tests the intangible assets for impairment if indicators of impairment are present.
Asset impairments during the nine months ended September 30, 2026 were approximately $13 million related to changes in future forecasted revenues and a product discontinuation. There were no asset impairments during the nine months ended September 30, 2025.
Estimated amortization expense of finite-lived intangible assets for the remainder of 2026 and the five succeeding years ending December 31 and thereafter are as follows:
| (in millions) | Remainder of 2026 | 2027 | 2028 | 2029 | 2030 | 2031 | Thereafter | Total | ||||||||||||||||||||||||||||||||||||||||||
| Amortization | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Goodwill
The changes in the carrying amounts of goodwill during the nine months ended September 30, 2026 and the year ended December 31, 2025 were as follows:
| (in millions) | Vision Care | Pharmaceuticals | Surgical | Total | ||||||||||||||||||||||||||||
| Balance, January 1, 2025 | $ | $ | $ | $ | ||||||||||||||||||||||||||||
| Acquisitions (Note 5) | ||||||||||||||||||||||||||||||||
| Foreign exchange and other | ||||||||||||||||||||||||||||||||
| Balance, December 31, 2025 | ||||||||||||||||||||||||||||||||
| Acquisitions | ||||||||||||||||||||||||||||||||
| Foreign exchange and other | ( | ( | ( | ( | ||||||||||||||||||||||||||||
Balance, September 30, 2026 | $ | $ | $ | $ | ||||||||||||||||||||||||||||
Goodwill is not amortized but is tested for impairment at least annually as of October 1st at the reporting unit level. A reporting unit is the same as, or one level below, an operating segment. Bausch + Lomb performs its annual impairment test by first assessing qualitative factors. Where the qualitative assessment suggests that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, a quantitative fair value test is performed for that reporting unit (Step 1).
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2025 Annual Goodwill Impairment Test
The Company conducted its annual goodwill impairment test as of October 1, 2025, by first assessing qualitative factors. Based on its qualitative assessment as of October 1, 2025, management believed that, it was more likely than not that the carrying amounts of each of its reporting units were less than their respective fair values and therefore concluded that a quantitative fair value test was not required.
September 30, 2026 Interim Assessment
No events occurred or circumstances changed during the period from October 1, 2025 (the last time goodwill was tested for all reporting units) through September 30, 2026 that would indicate that the fair value of any reporting unit might be below its carrying value.
If market conditions deteriorate, or if the Company is unable to execute its strategies, it may be necessary to record impairment charges in the future.
There were no goodwill impairment charges through September 30, 2026.
9.ACCRUED AND OTHER CURRENT LIABILITIES
Accrued and other current liabilities consist of:
| (in millions) | September 30, 2026 | December 31, 2025 | ||||||||||||
| Product Rebates | $ | $ | ||||||||||||
| Employee Compensation and Benefit Costs | ||||||||||||||
| Product Returns | ||||||||||||||
| Interest | ||||||||||||||
| Other | ||||||||||||||
| $ | $ | |||||||||||||
As of December 31, 2025, included within Other, in the table above, was the accrual of a $35 million sales-based milestone, related to MIEBO®, which was paid during the nine months ended September 30, 2026.
10.FINANCING ARRANGEMENTS
Principal amounts of debt obligations and principal amounts of debt obligations net of issuance costs consist of the following:
| September 30, 2026 | December 31, 2025 | |||||||||||||||||||||||||||||||
| (in millions) | Maturity | Principal Amount | Net of Premiums, Discounts and Issuance Costs | Principal Amount | Net of Premiums, Discounts and Issuance Costs | |||||||||||||||||||||||||||
| Senior Secured Credit Facilities | ||||||||||||||||||||||||||||||||
| September 2028 Term Facility | September 2028 | $ | $ | $ | $ | |||||||||||||||||||||||||||
| June 2030 Revolving Credit Facility | June 2030 | |||||||||||||||||||||||||||||||
| January 2031 Term Facility | January 2031 | |||||||||||||||||||||||||||||||
| January 2031 Refinancing Term Facility | January 2031 | |||||||||||||||||||||||||||||||
| Senior Secured Notes | ||||||||||||||||||||||||||||||||
| October 2028 Secured Notes | October 2028 | |||||||||||||||||||||||||||||||
| January 2031 Secured Notes | January 2031 | |||||||||||||||||||||||||||||||
| Other | Various | |||||||||||||||||||||||||||||||
| Total long-term debt | $ | $ | ||||||||||||||||||||||||||||||
| Less: Current portion of long-term debt | ||||||||||||||||||||||||||||||||
| Non-current portion of long-term debt | $ | $ | ||||||||||||||||||||||||||||||
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Senior Secured Credit Facilities and Notes
On May 10, 2022, Bausch + Lomb entered into a credit agreement (the “Original Credit Agreement”), providing for a term loan of $2,500 million (the “May 2027 Term Facility”) and a revolving credit facility of $500 million (the “May 2027 Revolving Credit Facility”).
On September 29, 2023, Bausch + Lomb entered into an incremental term loan facility in the form of an incremental amendment (the “September 2023 Credit Facility Amendment”) to the credit agreement and consisted of borrowings of $500 million in new term B loans with a five-year term to maturity (the “September 2028 Term Facility”). In addition, on September 29, 2023, Bausch + Lomb also issued $1,400 million aggregate principal amount of 8.375 % Senior Secured Notes due October 2028 (the “October 2028 Secured Notes”).
On November 1, 2024, Bausch + Lomb entered into an additional incremental term loan facility secured on a pari passu basis with the Company’s existing May 2027 Term Facility and September 2028 Term Facility. This incremental term loan facility was entered into in the form of an incremental amendment (the “November 2024 Credit Facility Amendment”) to our credit agreement and consisted of borrowing $400 million of new term loans with a maturity of May 2027 (the “May 2027 Incremental Term Facility”).
On June 26, 2025, Bausch + Lomb entered into an incremental amendment (the “June 2025 Credit Facility Amendment”) to our credit agreement, which consisted of a new $800 million revolving credit facility maturing June 26, 2030 (the “June 2030 Revolving Credit Facility”) and a new $2,325 million term B loan facility maturing January 15, 2031 (the “January 2031 Term Facility”). In addition, on June 26, 2025, Bausch + Lomb’s subsidiaries, Bausch + Lomb Netherlands B.V. and Bausch & Lomb Incorporated, issued €675 million aggregate principal amount of Senior Secured Floating Rate Notes due January 2031 (the “January 2031 Secured Notes” and, together with the October 2028 Secured Notes, the “Senior Secured Notes”). The January 2031 Secured Notes accrue interest at a rate per annum of: (i) three-month EURIBOR (subject to a 0 % floor) plus (ii) 3.875 %, reset quarterly, payable quarterly in arrears on January 15, April 15, July 15 and October 15 of each year, commencing on January 15, 2026. At September 30, 2026, the January 2031 Secured Notes bore interest at 6.31 % per annum.
The proceeds from the January 2031 Secured Notes, along with the proceeds of the January 2031 Term Facility, were used by the Company to: (i) repay in full outstanding borrowings under the May 2027 Revolving Credit Facility, (ii) refinance, in full, its outstanding term loans due 2027 (the May 2027 Term Facility and May 2027 Incremental Term Facility) and (iii) pay related fees and expenses.
On January 2, 2026, the Company entered into a refinancing transaction amendment (the “January 2026 Credit Facility Amendment”; the Original Credit Agreement, as amended by the September 2023 Credit Facility Amendment, the November 2024 Credit Facility Amendment, the June 2025 Credit Facility Amendment and the January 2026 Credit Facility Amendment, the “Amended Credit Agreement”) providing for a new $2,802 million term loan facility maturing on January 15, 2031 (the “January 2031 Refinancing Term Facility” or the “Term Facilities”; the Term Facilities, together with the June 2030 Revolving Credit Facility, the “Senior Secured Credit Facilities”). The Company used the proceeds from the January 2031 Refinancing Term Facility to refinance, in full, its outstanding term loans (the September 2028 Term Facility and January 2031 Term Facility).
The Senior Secured Credit Facilities are secured by substantially all of the assets of Bausch + Lomb and its material, wholly-owned Canadian, U.S., Dutch and Irish subsidiaries, subject to certain exceptions. The Term Facilities are denominated in U.S. dollars, and borrowings under the June 2030 Revolving Credit Facility may be made available in U.S. dollars, euros, pounds sterling and Canadian dollars. As of September 30, 2026, the principal amounts outstanding under the January 2031 Refinancing Term Facility were $2,788 million.
As of September 30, 2026, the Company had $100 million of outstanding borrowings, $34 million of issued and outstanding letters of credit and remaining availability, subject to certain customary conditions, of $666 million under its June 2030 Revolving Credit Facility. The stated rate of interest for borrowings under the Revolving Credit Facility at September 30, 2026 ranges from 6.52 % to 6.65 % per annum.
Borrowings under the June 2030 Revolving Credit Facility in: (i) U.S. dollars bear interest at a rate per annum equal to, at Bausch + Lomb’s option, either: (a) a term SOFR-based rate or (b) a U.S. dollar base rate, (ii) Canadian dollars bear interest at a rate per annum equal to, at Bausch + Lomb’s option, either: (a) a term CORRA-based rate or (b) a Canadian dollar prime rate, (iii) euros bear interest at a rate per annum equal to EURIBOR and (iv) pounds sterling bear interest at a rate per annum equal to SONIA, in each case, plus an applicable margin. The applicable interest rate margins for borrowings under the June 2030 Revolving Credit Facility are between 0.75 % to 1.75 % with respect to U.S. dollar base rate or Canadian dollar prime rate borrowings and between 1.75 % to 2.75 % with respect to SOFR, CORRA, EURIBOR or SONIA borrowings based on Bausch + Lomb’s total net leverage ratio. In addition, Bausch + Lomb is required to pay commitment fees of 0.25 % per annum in respect of the unutilized commitments under the June 2030 Revolving Credit Facility, payable quarterly in arrears.
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Bausch + Lomb is also required to pay letter of credit fees on the maximum amount available to be drawn under all outstanding letters of credit in an amount equal to the applicable margin on SOFR borrowings under the June 2030 Revolving Credit Facility on a per annum basis, payable quarterly in arrears, as well as customary fronting fees for the issuance of letters of credit and agency fees.
Borrowings under the January 2031 Refinancing Term Facility bear interest at a rate per annum equal to, at our option, either: (i) a term SOFR-based rate, plus an applicable margin of 3.75 %, or (ii) a U.S. dollar base rate, plus an applicable margin of 2.75 %. The stated rate of interest under the January 2031 Refinancing Term Facility at September 30, 2026 was 7.65 % per annum.
Subject to certain exceptions and customary baskets set forth in the Amended Credit Agreement, Bausch + Lomb is required to make mandatory prepayments of the loans under Term Facilities under certain circumstances, including from: (i) 100 % of the net cash proceeds of insurance and condemnation proceeds for property or asset losses (subject to reinvestment rights, decrease based on leverage ratios and net proceeds threshold), (ii) 100 % of the net cash proceeds from the incurrence of debt (other than permitted debt as described in the Amended Credit Agreement), (iii) 50 % of Excess Cash Flow (as defined in the Amended Credit Agreement) subject to decrease based on leverage ratios and subject to a threshold amount and (iv) 100 % of net cash proceeds from asset sales (subject to reinvestment rights, decrease based on leverage ratios and net proceeds threshold). These mandatory prepayments may be used to satisfy future amortization.
The amortization rate for the January 2031 Refinancing Term Facility is 1.00 % per annum, or $28 million, payable in quarterly installments, with the first installment paid on June 30, 2026. Bausch + Lomb may direct that prepayments be applied to such amortization payments in order of maturity. As of September 30, 2026, the remaining mandatory quarterly amortization payments for the January 2031 Refinancing Term Facility were $119 million through December 2030, with the remaining term loan balance being due in January 2031.
See Note 10, “FINANCING ARRANGEMENTS” in the Annual Report for additional information regarding the Company’s Senior Secured Credit Facilities and Notes.
Weighted Average Stated Rate of Interest
The weighted average stated rate of interest for the Company’s outstanding debt obligations as of September 30, 2026 and December 31, 2025 was 7.63 % and 7.70 %, respectively.
Loss on Extinguishment of Debt
In connection with the January 2026 Credit Facility Amendment, the Company incurred a loss on extinguishment of debt of approximately $1 million, representing the difference between the amount paid to settle the extinguished debt and the extinguished debt’s carrying value.
Maturities and Mandatory Payments
As of September 30, 2026, maturities and mandatory payments of debt obligations for the remainder of 2026, five succeeding years ending December 31 and thereafter are as follows:
| (in millions) | ||||||||
| Remainder of 2026 | $ | |||||||
| 2027 | ||||||||
| 2028 | ||||||||
| 2029 | ||||||||
| 2030 | ||||||||
| 2031 | ||||||||
| Thereafter | ||||||||
| Total gross maturities | ||||||||
| Unamortized discounts | ( | |||||||
| Total long-term debt and other | $ | |||||||
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Covenant Compliance
The Senior Secured Credit Facilities contain customary affirmative and negative covenants and specified events of default. These affirmative and negative covenants include, among other things, and subject to certain qualifications and exceptions, covenants that restrict Bausch + Lomb’s ability and the ability of its subsidiaries to: incur or guarantee additional indebtedness; create or permit liens on assets; pay dividends on capital stock or redeem, repurchase or retire capital stock or subordinated indebtedness; make certain investments and other restricted payments; engage in mergers, acquisitions, consolidations and amalgamations; transfer and sell certain assets; and engage in transactions with affiliates. The June 2030 Revolving Credit Facility also contains a financial covenant that requires the Company to, if, as of the last day of any fiscal quarter of the Company (commencing with the second full fiscal quarter ending after the closing the June 2025 Credit Facility Amendment), loans and swingline loans are outstanding thereunder in an aggregate amount greater than 35 % of the total commitments thereunder at such time, maintain a maximum first lien net leverage ratio of not greater than (a) commencing with the second full fiscal quarter ending after the closing of the June 2025 Credit Facility Amendment through and including the eighth full fiscal quarter, 5.75 :1.00, (b) commencing with the ninth full fiscal quarter after the closing of the June 2025 Credit Facility Amendment through and including the twelfth full fiscal quarter, 5.50 :1.00, (c) commencing with the thirteenth full fiscal quarter after the closing of the June 2025 Credit Facility Amendment through and including the sixteenth full fiscal quarter, 5.25 :1.00, and (d) thereafter, 5.00 :1.00. The financial covenant applicable to the June 2030 Revolving Credit Facility may be waived or amended with the consent of a majority of the lenders under the June 2030 Revolving Credit Facility, and without the consent of the lenders under any other Senior Secured Credit Facility or any other person and contain a customary term loan facility standstill and customary cure rights. The indentures governing the Senior Secured Notes also contain negative covenants and events of default that are similar to those contained in the Senior Secured Credit Facilities.
As of September 30, 2026, the Company was in compliance with its financial covenants related to its debt obligations. Bausch + Lomb, based on its current forecast for the next twelve months from the date of issuance of these Condensed Consolidated Financial Statements, expects to remain in compliance with its financial covenants and meet its debt service obligations over that same period.
Other Financing Arrangements
On January 9, 2026, the Company entered into a financing arrangement, that permits it, subject to certain conditions, to sell certain receivables to a third-party financial institution, potentially accelerating access to cash and reducing credit risk. Transactions under this financing arrangement are accounted for as true sales under Accounting Standards Codification (“ASC”) 860, Transfers and Servicing of Financial Assets, with the sold receivables derecognized from the Company’s Condensed Consolidated Balance Sheets. The cash received from the financial institution is reported within Operating Activities in the Condensed Consolidated Statements of Cash Flows.
During the nine months ended September 30, 2026, the Company received cash proceeds of $26 million from the sales of receivables under this financing arrangement. As of September 30, 2026, these receivables were collected and remitted to the financial institution. The costs related to these transactions were not material.
During the three months ended September 30, 2026, the Company entered into a contract to sell a warehouse and equipment for an aggregate sale price of up to €43 million, and then lease the assets back through a five-year leaseback transaction, with lease payments beginning in January 2028. As of September 30, 2026, the Company sold and leased back €33 million of these assets. This transaction did not qualify as a sale under the applicable accounting guidance, and, as such, the associated warehouse and equipment remained included within Property, plant and equipment, net. The Company refers to failed sale-leasebacks as "other financial liabilities" and recorded the related obligations in Current portion of long-term debt and other financial liabilities and Long-term debt and other financial liabilities in the Consolidated Balance Sheets.
As of September 30, 2026, the Company had $78 million, in aggregate, of outstanding other financial liabilities.
11.SHARE-BASED COMPENSATION
Bausch + Lomb Corporation 2022 Omnibus Incentive Plan
Effective May 5, 2022, Bausch + Lomb established the Bausch + Lomb Corporation 2022 Omnibus Incentive Plan (the “Plan”) and a total of 28,000,000 common shares of Bausch + Lomb were originally authorized for issuance under the Plan. The Plan was amended and restated effective April 24, 2023 and further amended and restated on May 29, 2024, to increase the number of shares authorized for issuance (the “Amended and Restated Plan”), resulting in an aggregate 52,000,000 common shares of Bausch + Lomb authorized for issuance under the Amended and Restated Plan.
The Amended and Restated Plan provides for the grant of various types of awards, including restricted stock units (“RSUs”), restricted stock, stock appreciation rights, stock options, performance-based awards and cash awards. Under the Amended and Restated Plan, the exercise price of awards, if any, is set on the grant date and may not be less than the fair market value
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per share on that date. Generally, stock options have a term of ten years and a three-year vesting period, subject to limited exceptions.
Share-based awards granted to senior management align with the Company’s focus on enhancing its revenue growth while maintaining focus on total shareholder return over the long term. The share-based awards granted under this long-term incentive program consist of time-based stock options, time-based RSUs and performance-based RSUs (“PSUs”). The PSUs are comprised of awards that vest upon: (i) achievement of certain share price appreciation conditions, including absolute and relative total shareholder return (“TSR”) (the “TSR PSUs”), (ii) attainment of certain performance targets that are based on the Company’s Organic Revenue Growth (the “Organic Revenue Growth PSUs”), (iii) outperformance of performance goals, based on the level of achievement of: (a) a revenue metric (measured for fiscal year 2026) and (b) relative TSR metric (if applicable) (“OPG PSU”) and (iv) attainment of certain performance targets (measured for fiscal year 2028) that are based on the Company’s adjusted earnings before interest, taxes, depreciation and amortization, as further defined in the applicable award agreement (the “Adjusted EBITDA PSUs”). If the Company’s performance is below a specified performance level, no common shares will be paid. Each vested PSU represents the right of a holder to receive a number of the Company’s common shares up to a specified maximum.
Approximately 7,700,000 common shares were available for future grants as of September 30, 2026. Bausch + Lomb uses reserved and unissued common shares to satisfy its obligations under its share-based compensation plans.
The components and classification of share-based compensation expense related to stock options, PSUs and RSUs directly attributable to those employees specifically identified as Bausch + Lomb employees for the three and nine months ended September 30, 2026 and 2025 were as follows:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Stock options | $ | $ | $ | $ | ||||||||||||||||||||||
| PSUs/RSUs | ||||||||||||||||||||||||||
| Share-based compensation expense | $ | $ | $ | $ | ||||||||||||||||||||||
| Research and development expenses | $ | $ | $ | $ | ||||||||||||||||||||||
| Selling, general and administrative expenses | ||||||||||||||||||||||||||
| Share-based compensation expense | $ | $ | $ | $ | ||||||||||||||||||||||
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Share-based awards granted for the nine months ended September 30, 2026 and 2025 consist of:
| Nine Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Stock options | |||||||||||
| Granted | |||||||||||
| Weighted-average exercise price | $ | $ | |||||||||
| Weighted-average grant date fair value | $ | $ | |||||||||
| RSUs | |||||||||||
| Granted | |||||||||||
| Weighted-average grant date fair value | $ | $ | |||||||||
| TSR PSUs | |||||||||||
| Granted | |||||||||||
| Weighted-average grant date fair value | $ | $ | |||||||||
| Organic Revenue Growth PSUs | |||||||||||
| Granted | |||||||||||
| Weighted-average grant date fair value | $ | $ | |||||||||
| Adjusted EBITDA PSUs | |||||||||||
| Granted | |||||||||||
| Weighted-average grant date fair value | $ | $ | |||||||||
| OPG PSUs | |||||||||||
| Granted | |||||||||||
| Weighted-average grant date fair value | $ | $ | |||||||||
As of September 30, 2026, the remaining unrecognized compensation expense related to all outstanding non-vested stock options, time-based RSUs and PSUs amounted to $136 million, which will be amortized over a weighted-average period of 1.58 years.
12.ACCUMULATED OTHER COMPREHENSIVE LOSS
Accumulated other comprehensive loss consists of:
| (in millions) | September 30, 2026 | December 31, 2025 | ||||||||||||
| Foreign currency translation adjustment | $ | ( | $ | ( | ||||||||||
| Pension adjustment, net of tax | ( | ( | ||||||||||||
| $ | ( | $ | ( | |||||||||||
Income taxes are not provided for foreign currency translation adjustments arising on the translation of Bausch + Lomb’s operations having a functional currency other than the U.S. dollar, except to the extent of translation adjustments related to Bausch + Lomb’s retained earnings for foreign jurisdictions in which Bausch + Lomb is not considered to be permanently reinvested.
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13.OTHER EXPENSE (INCOME), NET
Other expense (income), net for the three and nine months ended September 30, 2026 and 2025 consists of:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Asset impairments | $ | $ | $ | $ | ||||||||||||||||||||||
| Restructuring, integration and separation costs | ||||||||||||||||||||||||||
| Gain on sale of assets | ( | ( | ( | |||||||||||||||||||||||
| Litigation and other matters | ||||||||||||||||||||||||||
| Acquired in-process research and development costs | ||||||||||||||||||||||||||
| Acquisition-related costs | ||||||||||||||||||||||||||
| Acquisition-related contingent consideration | ( | ( | ||||||||||||||||||||||||
Other expense (income), net | $ | $ | ( | $ | $ | |||||||||||||||||||||
The Company evaluates opportunities to improve its operating results and implements cost savings programs to streamline its operations and eliminate redundant processes and expenses. Restructuring and integration costs include expenses associated with the implementation of these cost savings programs and include expenses associated with reducing headcount and other cost reduction initiatives. Restructuring, integration and separation costs for the nine months ended September 30, 2026 and 2025 were $21 million and $43 million, respectively, and primarily consist of employee severance costs. These severance costs were provided under an ongoing benefit arrangement and were therefore recorded once they were both probable and reasonably estimable in accordance with the provisions of ASC 712-10, “Nonretirement Postemployment Benefits”.
Acquired in-process research and development costs in 2025 primarily relates to the acquisition of Whitecap Biosciences, as discussed in Note 5, “ACQUISITIONS”.
14.INCOME TAXES
For interim financial statement purposes, U.S. GAAP income tax expense/benefit related to ordinary income is determined by applying an estimated annual effective income tax rate against a company’s ordinary income, subject to certain limitations on the benefit of losses. Income tax expense/benefit related to items not characterized as ordinary income is recognized as a discrete item when incurred. The estimation of Bausch + Lomb’s income tax provision requires the use of management forecasts and other estimates, application of statutory income tax rates and an evaluation of valuation allowances. The Company’s estimated annual effective income tax rate may be revised, if necessary, in each interim period.
Provision for income taxes for the nine months ended September 30, 2026 was $28 million. The difference between the statutory tax rate and the effective tax rate is primarily attributable to jurisdictional mix of earnings and the discrete tax effects of: (a) the tax effects of acquired tax intangibles and net operating losses, (b) a benefit related to a favorable settlement in a foreign jurisdiction, (c) the filing of certain tax returns and (d) a one-time tax assessment of a foreign subsidiary. Benefit from income taxes for the nine months ended September 30, 2025 was $36 million. The difference between the statutory tax rate and the effective tax rate was primarily attributable to jurisdictional mix of earnings and the discrete tax effects of: (a) a benefit for previously accrued taxes that settled favorably with the Internal Revenue Service, (b) the impact of the voluntary recall of certain enVista® IOL products, (c) the filing of certain tax returns and (d) a change in the deduction for stock compensation.
The Company records a valuation allowance against its deferred tax assets to reduce the net carrying value to an amount that it believes is more likely than not to be realized. When the Company establishes or reduces the valuation allowance against its deferred tax assets, the provision for income taxes will increase or decrease, respectively, in the period such determination is made. The valuation allowance against deferred tax assets was $226 million and $212 million as of September 30, 2026 and December 31, 2025, respectively. The increase is related to losses incurred during the nine months ended September 30, 2026 in jurisdictions for which the Company has established a full valuation allowance.
The Company’s U.S. affiliates remain under examination for various federal and state tax audits in the United States for years 2017 through 2024.
Bausch + Lomb in Canada is under examination for the 2023 tax year.
The Company's subsidiaries in Germany are under audit for tax years 2017 through 2019. The Company received a preliminary assessment from the German taxing authority that would disallow certain trade tax and transfer pricing adjustments. The Company is contesting this proposed tax deficiency through the appropriate appeals process, and if
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necessary, through appropriate litigation. Based on the current information available, the Company believes any exposure would not be material to its consolidated financial statements. Accordingly, no additional income tax provision has been recorded as of September 30, 2026.
The Company's subsidiaries in France are under audit for tax years 2023 through 2025.
As of September 30, 2026 and December 31, 2025, the Company had unrecognized tax benefits of $59 million and $71 million, respectively, which included interest and penalties of $10 million and $12 million, respectively. Of the total unrecognized tax benefits as of September 30, 2026, $50 million would reduce the Company’s effective tax rate, if recognized.
15.EARNINGS (LOSS) PER SHARE
Income (loss) per share attributable to Bausch + Lomb Corporation for the three and nine months ended September 30, 2026 and 2025 were calculated as follows:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
| (in millions, except per share amounts) | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Net income (loss) attributable to Bausch + Lomb Corporation | $ | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
| Basic weighted-average common shares outstanding | ||||||||||||||||||||||||||
| Diluted effect of stock options and RSUs | ||||||||||||||||||||||||||
| Diluted weighted-average common shares outstanding | ||||||||||||||||||||||||||
| Basic and diluted income (loss) per share attributable to Bausch + Lomb Corporation | $ | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
During the nine months ended September 30, 2026 and three and nine months ended September 30, 2025, all potential common shares issuable for RSUs, PSUs and stock options were excluded from the calculation of diluted loss per share, as the effect of including them would have been anti-dilutive. The dilutive effect of potential common shares issuable for RSUs, PSUs and stock options on the weighted-average number of common shares outstanding would have been approximately 4,041,000 common shares for the nine months ended September 30, 2026. The dilutive effect of potential common shares issuable for RSUs, PSUs and stock options on the weighted-average number of common shares outstanding would have been approximately 3,184,000 and 2,700,000 common shares for the three and nine months ended September 30, 2025, respectively.
During the three and nine months ended September 30, 2026, RSUs, PSUs and stock options to purchase approximately 9,079,000 and 10,936,000 common shares, respectively, were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive under the treasury stock method. During the three and nine months ended September 30, 2026, an additional 3,082,000
During the three and nine months ended September 30, 2025, RSUs, PSUs and stock options to purchase approximately 11,328,000 and 13,698,000 common shares, respectively, were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive under the treasury stock method. During the three and nine months ended September 30, 2025, an additional 2,494,000
16.LEGAL PROCEEDINGS
Bausch + Lomb is involved, and, from time to time, may become involved, in various legal and administrative proceedings, which include or may include product liability, intellectual property, commercial, tax, antitrust, governmental and regulatory investigations, related private litigation and ordinary course employment-related issues. From time to time, Bausch + Lomb also initiates or may initiate actions or file counterclaims. Bausch + Lomb could be subject to counterclaims or other suits in response to actions it may initiate. Bausch + Lomb believes that the prosecution of these actions and counterclaims is important to preserve and protect Bausch + Lomb, its reputation and its assets.
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On a quarterly basis, Bausch + Lomb evaluates developments in legal proceedings, potential settlements and other matters that could increase or decrease the amount of the liability accrued. As of September 30, 2026, Bausch + Lomb’s Condensed Consolidated Balance Sheets includes accrued current loss contingencies of $21 million related to matters which are both probable and reasonably estimable. For all other matters, unless otherwise indicated, Bausch + Lomb cannot reasonably predict the outcome of these legal proceedings, nor can it estimate the amount of loss, or range of loss, if any, that may result from these proceedings. An adverse outcome in certain of these proceedings could have a material adverse effect on Bausch + Lomb’s business, financial condition and results of operations, and could cause the market price or value of its common shares and/or debt securities to decline.
Antitrust
Generic Pricing Antitrust Litigation
BHC and its subsidiaries, Oceanside Pharmaceuticals, Inc., Bausch Health US, LLC (formerly Valeant Pharmaceuticals North America LLC) (“Bausch Health US”), and Bausch Health Americas, Inc. (formerly Valeant Pharmaceuticals International) (“Bausch Health Americas”) (for the purposes of this paragraph, collectively, the “Company”), are defendants in multidistrict antitrust litigation (“MDL”) entitled In re: Generic Pharmaceuticals Pricing Antitrust Litigation, pending in the U.S. District Court for the Eastern District of Pennsylvania (MDL 2724, 16 MD-2724). Bausch + Lomb Corporation had been named as a defendant in the MDL in one complaint, but this complaint has been amended to remove Bausch + Lomb Corporation and, as a result, Bausch + Lomb Corporation is no longer a party to the MDL. The lawsuits seek damages under federal and state antitrust laws, state consumer protection and unjust enrichment laws and allege that the Company’s subsidiaries entered into a conspiracy to fix, stabilize, and raise prices, rig bids and engage in market and customer allocation for generic pharmaceuticals. The lawsuits, which are brought as putative class actions by direct purchasers, end payers, and indirect resellers, and as direct actions by direct purchasers, end payers, insurers, hospitals, pharmacies, and various Counties, Cities, and Towns, are consolidated into the MDL. The Company has settled some of these lawsuits, while others remain pending. There are also additional, separate complaints which are consolidated in the same MDL that do not name the Company or any of its subsidiaries as a defendant. State of Connecticut, et al. v. Sandoz, Inc., et al., (D. CT, C.A. No. 3:20-00802), in which Bausch Health US and Bausch Health Americas are defendants, has been remanded to and is pending in the U.S. District Court for the District of Connecticut. Bausch Health US and Bausch Health Americas reached an agreement to settle the Connecticut case, which received final court approval, and have been dismissed from the case with prejudice. There are cases pending in the Court of Common Pleas of Philadelphia County and New York State Supreme Court against the Company and other defendants related to the multidistrict litigation. The Company disputes the claims against it and these cases will be defended vigorously.
These lawsuits cover products of both Bausch + Lomb and BHC’s other businesses. It is anticipated that Bausch + Lomb and BHC will split the fees and expenses associated with defending these claims, as well as any potential damages or other liabilities awarded in or otherwise arising from these claims, in the manner set forth in the MSA.
Product Liability
Shower to Shower® Products Liability Litigation
Since 2016, BHC and its affiliates, including Bausch + Lomb, have been named in a number of product liability lawsuits involving the Shower to Shower® body powder product acquired in September 2012 from Johnson & Johnson; due to dismissals, twenty-one (21 ) of such product liability suits currently remain pending. In three (3 ) cases pending in the Atlantic County, New Jersey Multi-County Litigation, agreed stipulations of dismissal have been entered by the Court, thus dismissing the Company from those cases. One (1 ) case was also recently dismissed with prejudice in its entirety for failure of plaintiff to comply with court orders requiring plaintiff fact sheets. Four (4 ) cases in the federal Multidistrict Litigation have been dismissed for failure to comply with orders requiring Plaintiff Profile Forms and/or for failure to produce evidence of a diagnosis of gynecologic ovarian cancer. Potential liability (including its attorneys’ fees and costs) arising out of these remaining suits is subject to full indemnification obligations of Johnson & Johnson owed to BHC and its affiliates, including Bausch + Lomb, and legal fees and costs will be paid by Johnson & Johnson. Twenty (20 ) of these lawsuits filed by individual plaintiffs allege that the use of Shower to Shower® caused the plaintiffs to develop ovarian cancer, mesothelioma or breast cancer. The allegations in these cases include failure to warn, design defect, manufacturing defect, negligence, gross negligence, breach of express and implied warranties, civil conspiracy concert in action, negligent misrepresentation, wrongful death, loss of consortium and/or punitive damages. The damages sought include compensatory damages, including medical expenses, lost wages or earning capacity, loss of consortium and/or compensation for pain and suffering, mental anguish anxiety and discomfort, physical impairment and loss of enjoyment of life. Plaintiffs also seek pre- and post-judgment interest, exemplary and punitive damages, and attorneys’ fees. Additionally, two proposed class actions were filed in Canada against BHC and various Johnson & Johnson entities (one in the Supreme Court of British Columbia and one in the Superior Court of Quebec), on behalf of persons who have purchased or used Johnson & Johnson’s Baby Powder or Shower to Shower®. The class actions allege the use of the product increases certain health risks (British Columbia) or
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negligence in failing to properly test, failing to warn of health risks, and failing to remove the products from the market in a timely manner (Quebec). The plaintiffs in these actions are seeking awards of general, special, compensatory and punitive damages. On November 17, 2020, the British Columbia court issued a judgment declining to certify a class as to BHC or Shower to Shower®, and at this time no appeal of that judgment has been filed. On December 16, 2021, the plaintiff in the British Columbia class action filed a Second Amended Notice of Civil Claim and Application for Certification, removing BHC as a defendant; as a result, the British Columbia class action is concluded as to BHC.
In October 2021, Johnson & Johnson, through one or more subsidiaries purported to complete a Texas divisional merger with respect to any talc liabilities at Johnson & Johnson Consumer, Inc. (“JJCI”). LTL Management, LLC (“LTL”), the resulting entity of the divisional merger, assumed JJCI’s talc liabilities and thereafter filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Western District of North Carolina, which in November 2021 was transferred to the U.S. Bankruptcy Court for the District of New Jersey (the “New Jersey Bankruptcy Court”). The first bankruptcy case was dismissed on April 4, 2023, after a decision by the Third Circuit Court of Appeals, and LTL re-filed a new Chapter 11 case on the same day. Several motions to dismiss were again filed, and on August 11, 2023, the second Chapter 11 case was dismissed. LTL and certain supporting creditors and tort claimants appealed, and on July 25, 2024, the Third Circuit affirmed the dismissal order, and LTL’s second bankruptcy case was closed. During the pendency of LTL’s bankruptcy cases, the New Jersey Bankruptcy Court extended a preliminary injunction that had stayed substantially all cases subject to the indemnification agreement related to Johnson & Johnson’s talc liability, which injunction was terminated in connection with the bankruptcy case dismissal.
In December 2023, LTL changed its name to LLT Management LLC (“LLT”). In June and July 2024, LLT solicited votes for a new “pre-packaged” Chapter 11 plan, and after the reported successful solicitation of votes to commence the planned bankruptcy, LLT and certain affiliates underwent another corporate restructuring that resulted in two entities, Red River Talc LLC (“Red River”) and Pecos River Talc LLC (“Pecos River”), assuming the talc liabilities of LLT. On September 20, 2024, Red River filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of Texas (the “Texas Bankruptcy Court”), seeking to resolve all ovarian cancer-related talc claims. On October 21, 2024, the Texas Bankruptcy Court agreed to enter a temporary restraining order and preliminary injunction staying all ovarian cancer-related talc claims at least through December 2024, which it has then extended through March 15, 2025. On December 9, 2024, Red River filed a Second Amended Chapter 11 plan incorporating the settlement with the Talc Claimants’ Committee. A hearing on confirmation of the plan and any objections thereto began on February 18, 2025. Johnson & Johnson has reported that the entity Pecos River will be responsible for resolving all non-ovarian cancer-related talc claims outside of bankruptcy. After the conclusion of the confirmation hearing, on March 31, 2025, the Texas Bankruptcy Court issued a memorandum decision denying confirmation of the plan, ordering the dismissal of Red River’s bankruptcy case and vacating the preliminary injunction. The debtor’s time to appeal has expired. Certain claimants filed motions to reconsider the dismissal of the bankruptcy case. Those motions were denied and the time to appeal has expired.
Red River, Pecos River and Johnson & Johnson continue to have indemnification obligations running to BHC and its affiliates, including Bausch + Lomb, for Shower to Shower® related product liability litigation. It is our expectation that Johnson & Johnson, in accordance with the applicable indemnification agreement, will continue to vigorously defend BHC and Bausch + Lomb in each of the remaining actions, and that BHC and Bausch + Lomb will not incur any material losses with respect to indemnification claims as a result of the divisional merger or the bankruptcy.
General Civil Actions
Doctors Allergy Formula Lawsuit
In April 2018, Doctors Allergy Formula, LLC (“Doctors Allergy”), filed a lawsuit against Bausch Health Americas in the Supreme Court of the State of New York, County of New York, asserting breach of contract and related claims under a 2015 Asset Purchase Agreement, which purports to include milestone payments that Doctors Allergy alleges should have been paid by Bausch Health Americas. Doctors Allergy claims its damages are not less than $23 million. Bausch Health Americas has asserted counterclaims against Doctors Allergy. Bausch Health Americas filed a motion seeking an order granting Bausch Health Americas’ motion for summary judgment on its counterclaims against Doctors Allergy and dismissing Doctors Allergy’s claims against Bausch Health Americas. The motion was fully briefed as of May 2021. The Court held a hearing on the motion on January 25, 2022. On May 12, 2023, the Court issued a Decision and Order denying the motion. On June 14, 2023, Bausch Health Americas filed a Notice of Appeal as to the Decision and Order. On March 13, 2024, Bausch Health Americas filed its appellate brief with the Appellate Division of the New York Supreme Court, First Department, appealing the trial court’s denial of Bausch Health America’s motion for summary judgment. Doctors Allergy filed its answering brief on July 26, 2024, and Bausch Health Americas filed its reply brief on September 13, 2024. The Appellate Division heard oral argument on November 7, 2024. On December 5, 2024, the Appellate Division denied Bausch Health Americas’ appeal as to Doctors Allergy’s second cause of action (breach of contract) and Bausch Health Americas’ counterclaims, but it granted the appeal as to Doctors Allergy’s third cause of action (breach of the implied duty of good faith and fair dealing) and dismissed that claim. On December 13, 2024, the Appellate Division remitted this action back to the trial court and on April 20, 2026,
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jury selection began. On May 8, 2026, the jury returned a split verdict on various causes of action, ultimately awarding a monetary judgment in favor of Doctors Allergy. Accordingly, the Company recorded a liability for the estimated loss associated with the judgment, which is reflected in the accompanying condensed consolidated financial statements. On June 1, 2026, Bausch Health Americas submitted its motion for judgment notwithstanding the verdict, which is now fully briefed and remains pending. Bausch Health Americas continues to dispute the claims against it and this lawsuit will be defended vigorously.
Completed or Inactive Matters
The following matters have concluded, have settled, are the subject of an agreement to settle or have otherwise been closed during or prior to the three months ended September 30, 2026 or have been inactive from the Company’s perspective for several fiscal quarters or the Company anticipates that no further material activity will take place with respect thereto. Due to the closure, settlement, inactivity or change in status of the matters referenced below, these matters will no longer appear in the Company’s future public reports and disclosures, unless required or as deemed appropriate. With respect to inactive matters, to the extent material activity takes place in subsequent quarters with respect thereto, the Company will provide updates as required or as deemed appropriate.
U.S. Securities Litigation – New Jersey Declaratory Judgment Lawsuit
On March 24, 2022, BHC and Bausch + Lomb were named in a declaratory judgment action in the Superior Court of New Jersey, Somerset County, Chancery Division, brought by certain individual investors in BHC’s common shares and debt securities who are also maintaining individual securities fraud claims against BHC and certain current or former officers and directors as part of the U.S. Securities Litigation. This action sought a declaratory judgment that alleged transfers of certain BHC assets to Bausch + Lomb would constitute a voidable transfer under the New Jersey Voidable Transactions Act and that Bausch + Lomb would be liable for damages, if any, awarded against BHC in the individual opt-out actions. The declaratory judgment action also alleged that the potential future separation of Bausch + Lomb from BHC by distribution of Bausch + Lomb stock to BHC’s shareholders would leave BHC with inadequate financial resources to satisfy these plaintiffs’ alleged securities fraud damages in the underlying individual opt-out actions. None of the plaintiffs in this declaratory judgment action have obtained a judgment against BHC in the underlying individual opt-out actions and BHC disputes the claims against it in those underlying actions. The underlying individual opt-out actions assert claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”), and certain actions assert claims under Section 18 of the Exchange Act. The allegations in those underlying individual opt-out actions are made against BHC and several of its former officers and directors only and relate to, among other things, allegedly false and misleading statements made during the 2013-2016 time period by BHC and/or failures to disclose information about BHC’s business and prospects, including relating to drug pricing and the use of specialty pharmacies. On March 31, 2022, BHC and Bausch + Lomb removed the declaratory judgment action to the U.S. District Court for the District of New Jersey. On April 29, 2022, Plaintiffs filed a motion to remand. On November 29, 2022, the District Court granted Plaintiffs’ remand motion and the case was remanded to the New Jersey Superior Court Chancery Division. On December 8, 2022, Plaintiffs filed a proposed Order to Show Cause and motion for a preliminary injunction and sought interim relief including expedited discovery. On December 13, 2022, the Court denied Plaintiffs’ proposed Order to Show Cause and stayed discovery pending the resolution of BHC’s and Bausch + Lomb’s forthcoming motions to dismiss, while instructing BHC to provide certain notice to Plaintiffs of the intended completion of a potential future distribution referenced above under certain circumstances. On December 22, 2022, Plaintiffs filed an amended complaint which, among other things, added claims seeking injunctive relief. On January 11, 2023, BHC and Bausch + Lomb moved to dismiss the amended complaint. Briefing was complete on February 24, 2023, and the motion to dismiss was heard on March 3, 2023. On April 3, 2023, the Court issued a decision granting in part and denying in part the motion to dismiss. In early August 2025, a settlement was reached and, on August 29, 2025, the Court issued an order staying this action pending satisfaction of certain conditions to that settlement. The case was dismissed with prejudice in January 2026.
Intellectual Property - Vyzulta and Lotemax SM Patent Litigation
In connection with the Vyzulta® and Lotemax® SM products, the Company previously commenced infringement proceedings against potential generic competitors in the U.S. In connection with Vyzulta®, three matters have been resolved and dismissed. In connection with Lotemax® SM, one matter resulted in a four-day bench trial starting January 13, 2025 and the case was dismissed without prejudice on January 5, 2026; another matter was filed in the U.S. District Court for the District of New Jersey and was dismissed without prejudice on March 18, 2026.
Intellectual Property Matters – Lumify Patent Litigation
On August 16, 2021, Bausch & Lomb Incorporated (“B&L Inc.”) received a Notice of Paragraph IV Certification from Slayback Pharma LLC (“Slayback”), in which Slayback asserted that certain U.S. patents, each of which is listed in the FDA’s Orange Book for Lumify® (brimonidine tartrate solution) drops (the “Lumify Patents”), are either invalid,
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unenforceable and/or will not be infringed by the commercial manufacture, use or sale of Slayback’s generic drops, for which an Abbreviated New Drug Application (“ANDA”) has been filed by Slayback. B&L Inc., through its affiliate Bausch + Lomb Ireland Limited, exclusively licenses the Lumify Patents from Eye Therapies, LLC (“Eye Therapies”). On September 10, 2021, B&L Inc., Bausch + Lomb Ireland Limited and Eye Therapies filed suit in the U.S. District Court for the District of New Jersey against Slayback pursuant to the Hatch-Waxman Act, alleging infringement by Slayback of one or more claims of the Lumify Patents (the “Slayback Lawsuit”), thereby triggering a 30 -month stay of the approval of the Slayback ANDA. Since then, U.S. Patent No. 9,259,425 has been dismissed from the case.
On May 15, 2023, the United States Patent & Trademark Office’s Patent Trial and Appeal Board (the “PTAB”) issued a Final Written Decision, finding all claims of U.S. Patent No. 8,293,742 unpatentable (IPR2022-00142). This decision was appealed to the United States Court of Appeals for the Federal Circuit (the “Federal Circuit”). The Federal Circuit issued its opinion on June 30, 2025, which reversed the PTAB’s claim construction of certain limitation, vacated its obviousness finding, and remanded for further proceedings.
Furthermore, two additional patents (U.S. Patent Nos. 11,596,600 and 11,833,245) have issued and been listed in the Orange Book as related to Lumify®. Lawsuits alleging infringement of these patents were filed in the U.S. District Court for the District of New Jersey against Slayback and its licensees, Dr. Reddy’s Laboratories S.A. and Dr. Reddy’s Laboratories, Inc. (collectively, “DRL”) (the “DRL Lawsuits”). The Slayback Lawsuit and DRL Lawsuits were subsequently consolidated into one district court action before the U.S. District Court for the District of New Jersey (3:21-cv-16766-RK-RLS). On December 15, 2023, B&L Inc., Bausch + Lomb Ireland Limited, and Eye Therapies filed a Motion for a Preliminary Injunction requesting the court to enjoin any infringing activities by DRL and a hearing was held in January 2024. On May 10, 2024, the Court denied Plaintiffs’ Motion, finding that Plaintiffs had not proven that they would be “irreparably harmed” absent a preliminary injunction.
Additionally, on December 18, 2023, B&L Inc., Bausch + Lomb Ireland Limited, and Eye Therapies amended its complaint in the consolidated district court action to add claims for copyright infringement, as well as claims under the Lanham Act, including trademark and trade dress infringement. DRL subsequently petitioned for inter partes review (“IPR”) of U.S. Patent Nos. 11,596,600 and 11,833,245 and the PTAB instituted both petitions (IPR2024-00467 and IPR2024-00563). Oral argument was held before the PTAB on May 13, 2025.
On July 9, 2025, settlement was reached with DRL and B&L Inc., Bausch + Lomb Ireland Limited, Eye Therapies and DRL entered into a settlement agreement effective as of July 9, 2025, providing for, among other things, a market entry date of June 30, 2027 (or earlier subject to certain acceleration clauses) for DRL’s generic drops. On July 14, 2025, the consolidated district court action (3:21-cv-16766-RK-RLS) was dismissed without prejudice and on July 22, 2025, the PTAB terminated IPR2024-00467 and IPR2024-00563. On August 13, 2025, the PTAB terminated IPR2022-00142 following remand from the Federal Circuit.
On March 28, 2025, B&L Inc. received a Notice of Paragraph IV Certification from Somerset Therapeutics, LLC (“Somerset”), in which Somerset asserted that U.S. Patent Nos. 8,293,742, 9,259,425, 11,596,600 and 11,833,245, each of which is listed in the FDA’s Orange Book for Lumify® (brimonidine tartrate solution) drops, are either invalid, unenforceable and/or will not be infringed by the commercial manufacture, use or sale of Somerset’s generic drops, for which an ANDA has been filed by Somerset. On April 28, 2025, B&L Inc., Bausch + Lomb Ireland Limited and Eye Therapies filed suit against Somerset and certain affiliates pursuant to the Hatch-Waxman Act, alleging infringement by Somerset of one or more claims of such Lumify Patents, thereby triggering a 30 -month stay of the approval of the Somerset ANDA. The case was dismissed on January 12, 2026.
On April 25, 2025, B&L Inc. and Bausch + Lomb Ireland Limited received a Notice of Paragraph IV Certification from Gland Pharma Limited (“Gland”), in which Gland asserted that U.S. Patent Nos. 8,293,742, 9,259,425, 11,596,600 and 11,833,245, each of which is listed in the FDA’s Orange Book for Lumify® (brimonidine tartrate solution) drops, are either invalid, unenforceable and/or will not be infringed by the commercial manufacture, use or sale of Gland’s generic drops, for which an ANDA has been filed by Gland. On April 28, 2025, B&L Inc., Bausch + Lomb Ireland Limited and Eye Therapies filed suit against Gland pursuant to the Hatch-Waxman Act, alleging infringement by Gland of one or more claims of such Lumify Patents, thereby triggering a 30 -month stay of the approval of the Gland ANDA. A stipulation and order of dismissal was entered by the court on December 23, 2025.
On November 6, 2025, B&L Inc. and Bausch + Lomb Ireland Limited received a Notice of Paragraph IV Certification from Granules India Ltd. (“Granules”), in which Granules asserted that U.S. Patent Nos. 8,293,742, 9,259,425, 11,596,600 and 11,833,245, each of which is listed in the FDA’s Orange Book for Lumify® (brimonidine tartrate solution) drops, are either invalid, unenforceable and/or will not be infringed by the commercial manufacture, use or sale of Granules’ generic drops, for which an ANDA has been filed by Granules. On December 9, 2025, B&L Inc., Bausch + Lomb Ireland Limited and Eye Therapies filed suit against Granules pursuant to the Hatch-Waxman Act, alleging infringement by Granules of one or more
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claims of such Lumify Patents, thereby triggering a 30 -month stay of the approval of the Granules ANDA. A consent judgment was entered by the court on April 1, 2026, and the matter was dismissed.
Generic Pricing Antitrust Litigation (Resolved)
In addition to the matter described above under “Generic Pricing Antitrust Litigation”, BHC and certain U.S. and Canadian subsidiaries (for the purposes of this paragraph, collectively the “Company”) were also named as defendants in a proposed class proceeding entitled Kathryn Eaton v. Teva Canada Limited, et al. in the Federal Court in Toronto, Ontario, Canada (Court File No. T-607-20). The plaintiff sought to certify a proposed class action on behalf of persons in Canada who purchased generic drugs in the private sector, alleging that the Company and other defendants violated the Competition Act by conspiring to allocate the market, fix prices, and maintain the supply of generic drugs, and seeking damages under federal law. The proposed class action contained similar allegations to the In re: Generic Pharmaceuticals Pricing Antitrust Litigation pending in the U.S. Court for the Eastern District of Pennsylvania. On February 20, 2026, the Canadian court declined to certify the action and dismissed the action against the Company. The deadline for the filing of an appeal has passed with no appeal filed.
17.SEGMENT INFORMATION
Reportable Segments
The Company’s interim Chief Executive Officer (“CEO”), who is the Company’s Chief Operating Decision Maker, manages the business through three
•The Vision Care segment consists of: (i) sales of contact lenses that span the spectrum of wearing modalities, including daily disposable and frequently replaced contact lenses, and (ii) sales of contact lens care products, OTC eye drops that address various conditions, including eye allergies, conjunctivitis, dry eye and redness relief, and eye vitamin and mineral supplements.
•The Pharmaceuticals segment consists of sales of a broad line of proprietary and generic pharmaceutical products for post-operative treatments and the treatment of a number of eye conditions, such as glaucoma, eye inflammation, ocular hypertension, dry eyes and retinal diseases.
•The Surgical segment consists of sales of medical device equipment, consumables and technologies for the treatment of cataracts, corneal, vitreous, retinal and refractive eye conditions, which includes IOLs and delivery systems, phacoemulsification equipment and other surgical instruments and devices necessary for ophthalmic surgery.
The Company’s Chief Operating Decision Maker uses segment profit to assess operating performance and make resource allocation decisions for each of its segments. Segment profit is based on operating income after the elimination of intercompany transactions. Certain costs, such as Amortization of intangible assets, and Other expense, net, are not included in the measure of segment profit, as management excludes these items in assessing segment financial performance.
Corporate includes the finance, treasury, certain research and development programs, tax and legal operations of Bausch + Lomb’s businesses and incurs certain expenses, gains and losses related to the overall management of Bausch + Lomb, which are not allocated to the other business segments. In assessing segment performance and managing operations, management does not review segment assets. Furthermore, a portion of share-based compensation is considered a corporate cost, since the amount of such expense depends on company-wide performance rather than the operating performance of any single segment.
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Segment Revenues and Profit
Segment revenues and profits for the three and nine months ended September 30, 2026 and 2025 were as follows:
| Vision Care | Pharmaceuticals | Surgical | Total | ||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Product Sales | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| Other Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Expenses | |||||||||||||||||||||||||||||||||||||||||||||||
| Cost of goods sold (excluding amortization and impairments of intangible assets) | |||||||||||||||||||||||||||||||||||||||||||||||
| Cost of other revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Selling, general and administrative | |||||||||||||||||||||||||||||||||||||||||||||||
| Research and development | |||||||||||||||||||||||||||||||||||||||||||||||
| Segment Profit | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
| Corporate | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Amortization of intangible assets | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Other (expense) income, net | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest income | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Loss on extinguishment of debt | |||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange and other | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Income (loss) before provision for income taxes | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||
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| Vision Care | Pharmaceuticals | Surgical | Total | ||||||||||||||||||||||||||||||||||||||||||||
| Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Product Sales | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| Other Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Expenses | |||||||||||||||||||||||||||||||||||||||||||||||
| Cost of goods sold (excluding amortization and impairments of intangible assets) | |||||||||||||||||||||||||||||||||||||||||||||||
| Cost of other revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Selling, general and administrative | |||||||||||||||||||||||||||||||||||||||||||||||
| Research and development | |||||||||||||||||||||||||||||||||||||||||||||||
| Segment Profit | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
| Corporate | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Amortization of intangible assets | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Other expense, net | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest income | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Loss on extinguishment of debt | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange and other | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Loss before provision for income taxes | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||||||||||||
Revenues by Segment and by Product Category
Revenues by segment and product category were as follows:
| Vision Care | Pharmaceuticals | Surgical | Total | ||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||
| Pharmaceuticals | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| Devices | |||||||||||||||||||||||||||||||||||||||||||||||
| OTC | |||||||||||||||||||||||||||||||||||||||||||||||
| Branded and Other Generics | |||||||||||||||||||||||||||||||||||||||||||||||
| Other revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||||||||||
| Pharmaceuticals | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| Devices | |||||||||||||||||||||||||||||||||||||||||||||||
| OTC | |||||||||||||||||||||||||||||||||||||||||||||||
| Branded and Other Generics | |||||||||||||||||||||||||||||||||||||||||||||||
| Other revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
The top ten products/franchises represented 57 % and 55 % of total revenues for the nine months ended September 30, 2026 and 2025, respectively.
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18.SUBSEQUENT EVENTS
Chief Executive Officer Transition and Separation Agreement
On October 12, 2026 (the “Transition Date”), the Company announced the appointment of Thomas J. Appio as interim Chief Executive Officer of the Company, effective as of the Transition Date. Brent Saunders, former Chief Executive Officer of the Company and a member of the Company’s Board, and the Board mutually agreed to Mr. Saunders’ departure from the Company, effective as of the Transition Date. In connection with his departure, Mr. Saunders also ceased serving on the Board effective as of the Transition Date. As part of the separation agreement between the Company and Mr. Saunders, dated as of October 11, 2026, (the “Separation Agreement”), Mr. Saunders will receive a lump-sum cash payment of approximately $75 million in the aggregate, that will be payable in accordance with the Separation Agreement. Pursuant to the Separation Agreement, all of Mr. Saunders’ outstanding equity and equity-based incentive awards, whether vested or unvested, under the Company’s 2022 Omnibus Incentive Plan, were forfeited and cancelled effective upon entering into the Separation Agreement. As the Separation Agreement was entered into subsequent to September 30, 2026, the accompanying condensed consolidated financial statements do not reflect any amounts related to the Separation Agreement.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
INTRODUCTION
Unless the context otherwise indicates, as used in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the terms “we,” “us,” “our,” “Bausch + Lomb,” the “Company,” and similar terms refer to Bausch + Lomb Corporation and its subsidiaries. This “Management’s Discussion and Analysis of Financial Condition and Results of Operations” has been updated through October 28, 2026 and should be read in conjunction with the unaudited interim Condensed Consolidated Financial Statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2026 (this “Form 10-Q”). The matters discussed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contain certain forward-looking statements within the meaning of Section 27A of The Securities Act of 1933, as amended (the “Act”), and Section 21E of The Securities Exchange Act of 1934, as amended, and that may be forward-looking information within the meaning defined under applicable Canadian securities laws (collectively, “Forward-Looking Statements”). See “Forward-Looking Statements” at the end of this discussion.
Our accompanying unaudited interim Condensed Consolidated Financial Statements as of September 30, 2026 and for the three and nine months ended September 30, 2026 and 2025 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) for interim financial statements, and should be read in conjunction with our Consolidated Financial Statements for the year ended December 31, 2025, which were included in our Annual Report on Form 10-K filed with the SEC and the Canadian Securities Administrators (the “CSA”) on February 18, 2026 (the “Annual Report”). In our opinion, the unaudited interim Condensed Consolidated Financial Statements reflect all adjustments, consisting of normal and recurring adjustments, necessary for a fair statement of the financial condition, results of operations and cash flows for the periods indicated. Additional Company information is available on SEDAR+ at www.sedarplus.com and on the SEC website at www.sec.gov. All currency amounts are expressed in U.S. dollars, unless otherwise noted. Certain defined terms used herein have the meaning ascribed to them in the accompanying unaudited interim Condensed Consolidated Financial Statements as of September 30, 2026 and for the three and nine months ended September 30, 2026 and 2025.
OVERVIEW
Bausch + Lomb is a leading global eye health company dedicated to protecting and enhancing the gift of sight for millions of people around the world—from the moment of birth through every phase of life. Our mission is simple, yet powerful: helping you see better, to live better. Bausch + Lomb develops, manufactures and markets a range of products, primarily in the areas of eye health, which are marketed directly or indirectly in approximately 100 countries. As a fully integrated eye health business, Bausch + Lomb has a comprehensive portfolio of approximately 400 products, which includes an established line of contact lenses, intraocular lenses (“IOLs”) and other medical devices, surgical systems and devices, vitamin and mineral supplements, lens care products, prescription eye-medications and other consumer products that positions us to compete in all areas of the eye health market.
Bausch + Lomb is a subsidiary of Bausch Health Companies Inc. (“BHC”), with BHC holding, directly or indirectly, approximately 87% of the issued and outstanding common shares of Bausch + Lomb, as of October 21, 2026. On August 6, 2020, BHC announced its plan to separate our eye health business into an independent publicly traded entity, separate from the remainder of BHC (the “Separation”).
We understand that BHC continues to evaluate all relevant factors and considerations relating to its investment in Bausch + Lomb, including any completion of the full Separation. However, there can be no assurance that the Separation will be consummated, the form any such consummated Separation would take or that, even if consummated, we will realize the anticipated benefits from the Separation.
Reportable Segments
Our portfolio of products falls into three operating and reportable segments: (i) Vision Care, (ii) Pharmaceuticals and (iii) Surgical.
The Vision Care segment—includes both our contact lens and consumer eye care businesses.
Our contact lens portfolio spans the spectrum of wearing modalities, including daily disposable and frequently replaced contact lenses, and contact lenses that are indicated for therapeutic use and that can also provide optical correction during healing, if required. In particular, our Vision Care contact lens portfolio includes our Bausch + Lomb INFUSE® (silicone hydrogel (“SiHy”)) daily disposable contact lenses, Biotrue® ONEday daily disposables, PureVision® SiHy contact lenses, SofLens® daily disposables and Bausch + Lomb ULTRA® contact lenses.
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Our consumer eye care business consists of contact lens care products, over-the-counter (“OTC”) eye drops that address various conditions, including eye allergies, conjunctivitis, dry eye and redness relief, and eye vitamins and mineral supplements. Within our consumer eye care business, our lens care product portfolio includes Biotrue® and Renu® multipurpose solutions and Boston® cleaning and conditioning solutions, our eye drops include Lumify®, Soothe®, Artelac®, Alaway® and Mioclear® and our eye vitamins include PreserVision® and Ocuvite®.
The Pharmaceuticals segment—consists of a broad line of proprietary and generic pharmaceutical products for post-operative treatments and treatments for a number of eye conditions, such as glaucoma, eye inflammation, ocular hypertension, dry eyes and retinal diseases. Key proprietary pharmaceutical brands are MIEBO®, XIIDRA®, Vyzulta®, Lotemax®, Prolensa® and Minims®.
The Surgical segment—consists of medical device equipment, consumables and technologies for the treatment of cataracts, corneal, vitreous retinal and refractive eye conditions, which includes IOLs and delivery systems, phacoemulsification equipment and other surgical instruments and devices necessary for cataract surgery. Key surgical brands include Akreos®, AMVISC®, IC-8 Apthera®, Crystalens® IOLs, enVista® IOLs, Eyetelligence® Surgical Planning Software, Millennium®, Stellaris Elite® vision enhancement system, Synergetics®, ClearVisc®, StableVisc®, Storz® ophthalmic instruments, VICTUS® femtosecond laser, Teneo®, Eyefill® and Zyoptix®.
Product Development
Our team of approximately 900 dedicated Research and Development (“R&D”) employees is focused on advancing our pipeline and identifying new product opportunities and we believe we have a significant innovation opportunity today. We have a robust global pipeline with projects in various stages of pre-clinical and clinical development, including new contact lenses for myopia, next-generation cataract equipment, premium IOLs, investigational treatments for dry eye, novel formulation for eye vitamins and preservative free formulation of eye drops, among others, that are designed to grow our portfolio and accelerate future growth.
Our internal R&D organization focuses on the development of products through robust bench testing that is designed to comply with international standards and through clinical trials. Certain of our key pipeline products are listed below.
Vision Care
•Lumify® Franchise – An OTC redness reliever eye drop that significantly reduces redness to help eyes look whiter and brighter, revealing eyes’ natural beauty. To date, we have launched and acquired the right to launch Lumify® in various countries. A new line extension formulation, Lumify® Preservative Free, was launched in the first quarter of 2025. In addition, the Company has completed a Lumify® next generation ("Lumify NXTTM" (formerly Lumify Luxe)) development program, for which a Phase 3 study met all primary and secondary endpoints and for which the New Drug Application (“NDA”) has been submitted and approval is anticipated in the first half of 2027.
•Blink® Franchise – During June 2024, we expanded our over-the-counter dry eye portfolio with the launch of Blink® NutriTears®, a clinically proven OTC nutritional supplement that targets the key root causes of dry eyes, promotes healthy tear production and provides noticeable relief of eye dryness symptoms. In June 2025, the Company launched Blink® Boost preservative free lubricating eye drops in the U.S. and, in March 2026, we launched a preservative-free lipid-based formulation of our Blink Triple Care® product.
•PreserVision AREDS3TM Eye Vitamins – We have developed PreserVision AREDS3TM, a next-generation eye vitamin formulation, in an effort to expand our eye vitamins portfolio. PreserVision AREDS3TM formula was launched in the first half of 2026.
•Bioactive Lens – We are developing a new bioactive contact lens incorporating bioactive hyaluronic acid hydrogel, a novel material design for daily disposable contact lens. Internal clinical studies have been ongoing, and we have completed the first external clinical study. The second external study is expected to start in the first half of 2027.
•Myopia Control Contact Lens – A multi-year study has begun for a Myopia control contact lens. We expect the U.S. registration clinical study to start in the second half of 2026.
•DD SiHy Lens - A second daily disposable SiHy lens designed for affordable innovation being developed leveraging our existing manufacturing platform.
•FRP SiHy - A new premium planned replacement SiHy lens being developed with a focus on providing unsurpassed comfort throughout the month.
Pharmaceuticals
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•Dual-Action Lifitegrast – We are developing the first dual-action therapeutic to address evaporative and inflammatory dry eye. Phase 2b data provided a clear path forward, and we are advancing the dual-action eye drop into Phase 3 development.
•Ocular Pain – We are developing a first-in-class neurosensory agent therapy for ocular surface pain. We have completed the Phase 1 study, and Phase 2 results are anticipated in the second half of 2026.
•Glaucoma Neuroprotection – We were in the process of developing the first glaucoma therapy to lower intraocular pressure and improve visual function. However, Phase 2 results were received in July 2026, and the study did not achieve its primary endpoint. Based on the totality of the data, the Company has decided not to advance the program in this indication as a topical eye drop.
Surgical
•enVista® – We are expanding our portfolio of premium IOLs built on the enVista® platform with the following:
◦enVista Aspire® monofocal and toric IOLs with Intermediate Optimized optics. These IOLs launched in the U.S. in October 2023 and in Europe and Canada in 2025.
◦enVista Envy® trifocal IOLs. These IOLs launched in Canada, the U.S., Europe and Hong Kong, and rollouts into additional geographies are expected.
◦enVista BeyondTM extended depth of focus (“EDOF”). The Company recently received topline results, and is conducting a comprehensive review of the data. enVista BeyondTM is anticipated to launch in the U.S. in 2027.
•LuxLife® – We are expanding our portfolio of premium IOLs built on the “Lux” platform with the LuxLife® Trifocal IOL with two options, non-Toric and Toric for astigmatic patients. The European launch of this product is in process.
•ELIOS® – In December 2024, we acquired Elios Vision, Inc. (“Elios Vision”). Elios Vision, a privately held company, is the developer of the ELIOS® procedure, the first clinically validated, minimally invasive glaucoma surgery procedure using an excimer laser. The U.S. launch of this product is anticipated by the end of 2026 and we expect this acquisition to then bolster the Company’s glaucoma treatment portfolio.
•SeeNovaTM – We are developing the next generation ophthalmic microsurgical system for Anterior, Posterior and Combined segment surgeries. US and EU releases are anticipated in 2028.
•SeeLyraTM – Femtosecond laser assisted cataract surgery system with integration of phaco components. European CE Mark was obtained in September 2026 and 510k submission is anticipated, with approval anticipated by the end of 2026.
We also have a number of other pipeline products that we are in the process of developing. In addition to internal development, we continuously search for new product opportunities through strategic licensing agreements and acquisitions, that, if successful, will allow us to leverage our commercial footprint and supplement our existing product portfolio and address specific unmet needs in the market.
Business Trends
In addition to the actions previously outlined, the events described below have affected and may affect our business trends. The matters discussed in this section contain Forward-Looking Statements. Please see “Forward-Looking Statements” for additional information.
Geopolitical Conflicts
In February 2022, Russia invaded Ukraine. As military activity and sanctions against Russia, Belarus and specific areas of Ukraine have continued, the war has continued to affect economic and global financial markets and placed further pressure on ongoing economic challenges, including issues such as inflation and global supply-chain disruption.
The imposed U.S. and European Union (“EU”) sanctions and export controls against Russia and Belarus temporarily impacted our ability to distribute certain products to Russia and Belarus. However, in response to these sanctions, we obtained licenses, or other applicable governmental authorizations, necessary to allow us to sell the applicable currently sanctioned products in each of these countries. To date, the challenges associated with the Russia-Ukraine War and related sanctions from the U.S., EU and elsewhere have not yet had a material impact on our operations; although, we continue to review recent and proposed sanctions imposed by the EU, U.S. and others to assess their impact on our operations. Our revenues attributable to Russia, Ukraine and Belarus, in the aggregate, were approximately 3% of our total revenues for both
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the nine months ended September 30, 2026 and year ended December 31, 2025. In addition, we do not have any research or manufacturing facilities in Russia, Ukraine or Belarus.
The conflict between Israel and Hamas began during October 2023 and expanded to include other countries and militant groups, including Iran. Commencing in February 2026, the conflict further escalated and the U.S. and Israel began launching ongoing missile strikes against Iran, which launched counter strikes against various targets in the region. While certain ceasefire or de-escalation efforts have been announced, the conflict remains ongoing. Our revenues attributable to the impacted regions for the nine months ended September 30, 2026 and year ended December 31, 2025 were approximately 2% of our total revenues in each period. Sales in Iran are covered by a general Office of Foreign Assets Control license.
While we have been monitoring these conflicts (including the potential macroeconomic impact of such conflicts), and will continue to do so as these conflicts continue to evolve, we are unable to predict the impact of these conflicts on the Company’s business, both in the impacted regions and generally.
For a further discussion of these and other risks relating to our international business, see “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations- Business Trends” of our Annual Report.
Global Trade and Tariff Environment
The Company is monitoring ongoing policy changes being made by the Trump administration, including those related to existing trade agreements and the actual or threatened imposition and implementation of new tariffs and the counter-duties, counter-tariffs and/or other counter-measures threatened or implemented in response by other countries. Some of these policies have targeted countries in which we do business and some policies target the sectors in which we do business, including the recent Presidential proclamation which imposes a one hundred percent (100%) tariff on patented pharmaceutical products and associated pharmaceutical ingredients, subject to certain exemptions for certain countries and certain companies. Given the international scope of our operations and breadth of our product portfolio, any sanctions, export controls, tariffs, trade wars and other governmental actions could have an adverse effect on our business, financial condition, cash flows and results of operations. Similarly, adverse economic and geopolitical conditions impacting our customers in these countries or uncertainty about global economic conditions or the geopolitical environment could result in purchases of our products to decline, which would adversely affect our revenues and operating results and could also cause a decline in our share price.
As of the date of this filing, the current state of recent tariffs, counter-tariffs and other trade restrictions is fluid and continuously evolving; however, the Company is monitoring the situation and believes that, building on its existing revenue stream from products manufactured in-country (which in certain key regions, such as the U.S. and EU, represent a significant portion of the overall revenue), it has certain potential actions that could be taken in response to such tariffs, counter-tariffs and other trade restrictions to help to mitigate their overall impact to the Company and its business. These actions may include strategic inventory stocking, leveraging its global footprint to shift manufacturing and optimizing existing capacity to in-source manufacturing.
Additionally, on February 20, 2026 the U.S. Supreme Court issued a decision invalidating tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”). In response to the U.S. Supreme Court’s decision, new Executive Orders were announced aimed at restructuring U.S. tariff policy and exploring alternative statutory authorities under which to impose or maintain tariffs. On March 4, 2026, the U.S. Court of International Trade (“CIT”) ordered the U.S. Customs and Border Protection (“CBP”) to liquidate (meaning calculate and finalize) and, where applicable, reliquidate, or correct, certain import entries without regard to duties imposed under the IEEPA. The CIT order provides relief for entries affected by IEEPA tariffs, and, on April 20, 2026, the CBP opened the Consolidated Administration and Processing of Entries portal to facilitate the submission and processing of IEEPA duty refund claims. During the nine months ended September 30, 2026, we received approximately $15 million of recoveries related to previously paid tariffs, of which approximately $14 million were received during the three months ended September 30, 2026. We continue to evaluate the impact of these developments on our business, financial condition, cash flows and results of operations.
See the section entitled “Risk Factors” included in our Annual Report, for additional information on the risks associated with tariffs.
Regulatory Compliance of Bausch + Lomb Facilities
In the normal course of business, our products, devices and facilities are the subject of ongoing oversight and review by regulatory and governmental agencies, including general, for cause and pre-approval inspections by the FDA. In June 2026, following a routine FDA inspection of our Tampa, Florida facility, as part of its findings, the FDA issued an Official Action Indicated (“OAI”) of our Tampa, Florida facility. We submitted to the FDA a response to the initial inspection and a subsequent response to the OAI, in connection with which we fully completed all comprehensive corrective and preventive
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actions raised therewith. Subsequently, in September 2026, we received a warning letter from the FDA in connection with this matter. We have submitted our response to the FDA in connection with the warning letter, and we are in the process of completing the corrective and preventive actions raised. We have also requested a meeting with the FDA and are awaiting a response from the FDA. The Warning Letter does not require the Tampa facility to cease manufacturing operations and does not require a product recall, withdrawal or other market action. The Tampa facility continues to manufacture, release and distribute product and management does not anticipate any interruption to product supply and remains confident in the quality and safety of products manufactured at the Tampa facility.
Global Minimum Corporate Tax Rate
On October 8, 2021, the Organisation for Economic Co-operation and Development (“OECD”)/G20 inclusive framework on Base Erosion and Profit Shifting (the “Inclusive Framework”) published a statement updating and finalizing the key components of a two-pillar plan on global tax reform. The Inclusive Framework plan has now been agreed to by more than 140 OECD members, including several countries which did not agree to the initial plan. Under Pillar One, a portion of the residual profits of multinational businesses with global turnover above €20 billion and a profit margin above 10% will be allocated to market countries where such allocated profits would be taxed. Under Pillar Two, the Inclusive Framework has agreed on a global minimum corporate tax rate of 15% for companies with revenue above €750 million, calculated on a country-by-country basis. While many countries have adopted some or all aspects of these rules, some countries have not adopted any or all of them, and many interpretive questions remain that are expected to be addressed in future guidance. On June 20, 2024, Canada enacted the Global Minimum Tax Act (“GMTA”) that adopted certain components of Pillar Two. The GMTA is generally aligned with the model rules proposed by the OECD.
The United States did not announce plans to enact the tax measures under the two-pillar plan. On January 20, 2025, the Trump administration issued an executive order declaring the Inclusive Framework has no force or effect in the U.S. absent congressional action, and directing the U.S. Department of Treasury to: (i) investigate whether any non-U.S. countries are not in compliance with any U.S. tax treaty or have implemented or are likely to implement tax rules that are extraterritorial or disproportionately affect U.S. companies, which may include actions or taxes imposed under Pillar One or Pillar Two, and (ii) develop options for “protective measures” in response to any such noncompliance or tax rules. On June 28, 2025, the United States and the rest of the G7 countries announced an agreement that would, in principle, exclude U.S. parented groups from certain taxes under Pillar Two and address certain risks of base erosion and profit shifting. In January 2026, the OECD published the “side by side” arrangement package to implement this exclusion. In September, 2026, the Inclusive Framework released further guidance and an updated GloBE Information Return to incorporate the simplifications included in the "side by side" arrangement package. However, we cannot predict whether the United States will adopt any other protective measures including with respect to any taxes imposed under Pillar One, or whether or how any non-U.S. countries may change their tax laws, including with respect to taxes imposed under Pillar One or Pillar Two, in response to the executive order, the “side by side” arrangement described above, or otherwise. It is possible that any changes in United States. or non-U.S. tax law could have a material adverse effect on our future tax liabilities and our effective tax rate.
While many jurisdictions in which the Company operates have adopted the global minimum tax provision of Pillar Two effective for tax years beginning in January 2024, the Company has concluded that there is minimal impact to its 2026 tax rate due to the accounting for the tax effects of intercompany transactions. The Company expects that there is risk that the impact of the global minimum tax and other changes in tax law in jurisdictions in which it operates may eventually result in an increase to its overall effective tax rate.
U.S. Legislative Changes
On July 4, 2025, President Trump signed into law H.R. 1, the One Big Beautiful Bill Act (the “OBBBA”). The effects of this legislation for the Company include extending and modifying certain key Tax Cuts & Jobs Act provisions (both domestic and international). The corporate tax rate remains unchanged but bonus depreciation, domestic R&D expensing, and an adjustment to the interest deduction limitation were retroactive to January 2025. The OBBBA makes additional changes to international tax provisions, including substantive changes to existing global intangible low-taxed income (GILTI), foreign-derived intangible income (FDII), and base erosion and anti-abuse tax (BEAT) provisions. These changes are effective for taxable years after 2025. The Company continues to evaluate the impact of the enactment of the OBBBA, but has determined that, as of September 30, 2026, it should not have a material impact on the Company’s consolidated financial statements.
Health Care Reform
The U.S. federal and state governments continue to propose and pass legislation designed to regulate the health care industry. Under the former Biden administration, many of these changes focused on health care cost containment, which resulted in pricing pressures relating to the sales and reimbursements of health care products and could result in legislative and regulatory changes that may negatively impact our businesses. We are monitoring potential health care-related legislative and regulatory changes that may be proposed and passed or otherwise pursued under the Trump administration.
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In addition, we continue to face various proposed health care pricing changes and regulations from governments throughout the world in locations in which we operate our business. These proposed changes may also continue to result in pricing pressures relating to sales, promotions and reimbursement of our product portfolio.
We continually review newly enacted and proposed U.S. federal and state legislation, as well as proposed rulemaking and guidance published by the U.S. Department of Health and Human Services, the FDA and applicable foreign governments in locations in which we operate; however, at this time, it is unclear the effect these matters may have on our businesses.
Generic Competition and Loss of Exclusivity
Certain of our products face the expiration of their patent or regulatory exclusivity over the next five years, following which we anticipate generic competition of these products. Following a loss of exclusivity (“LOE”) of and/or generic competition for a product, we would anticipate that product sales for such product would decrease significantly shortly following the LOE or entry of a generic competitor. Where we have the rights, we may elect to launch an authorized generic (“AG”) of such product (either ourselves or through a third party) prior to, upon or following generic entry, which may mitigate the anticipated decrease in product sales.
While we expect our risk of LOE to be limited over the next five years, this could change based on, among other things, successful challenge to our patents, settlement of existing or future patent litigation and at-risk generic launches. We believe the entry into the market of generic competition generally would have an adverse impact on the volume and/or pricing of the affected products, however we are unable to predict the magnitude or timing of this impact.
We have in the past commenced, and may in the future commence, infringement proceedings with respect to certain of our products against potential generic competitors or other potential infringers in the U.S. and elsewhere. For example, we previously commenced infringement proceedings against potential generic competitors in the U.S. with respect to our PreserVision®, Lumify®, Lotemax® SM and Vyzulta® products and franchises, which have now been dismissed or otherwise resolved. If we are not successful in such infringement proceedings, we may face increased generic competition for these products.
In addition, the PreserVision® U.S. formulation patent expired in March 2021 and the U.S. patent covering methods of using the formulation expired in early 2026. Our revenues from PreserVision® products for 2025 and 2024 accounted for approximately 6% of our total revenues for each period. While PreserVision® and Lumify® drops were the subjects of certain past patent infringement proceedings and while the Company cannot predict the magnitude or timing of a LOE impact from PreserVision® and Lumify® drops, as these are OTC products, the impact is not expected to be as significant as the LOE of a branded pharmaceutical product.
See Note 16, “LEGAL PROCEEDINGS” to our unaudited interim Condensed Consolidated Financial Statements included elsewhere in this Form 10-Q, as well as Note 19, “LEGAL PROCEEDINGS” of our audited Consolidated Financial Statements for the year ended December 31, 2025, included in our Annual Report, for further details regarding certain of these infringement proceedings.
The risks of generic competition are a fact of the eye health industry and are not specific to our operations or product portfolio. These risks are not avoidable, but we believe they are manageable. To manage these risks, our leadership team routinely evaluates the impact that generic competition may have on future profitability and operations. In addition to aggressively defending our patents and other intellectual property, our leadership team makes operational and investment decisions regarding these products and businesses at risk, including decisions regarding our pipeline. Our leadership team actively manages our pipeline in order to identify innovative and realizable projects that are expected to provide incremental and sustainable revenues and growth into the future. We believe that we have a well-established product portfolio that is diversified within our core businesses. We also believe that we have a robust pipeline that not only provides for the next generation of our existing products, but also brings new solutions into the market.
See the section entitled “Risk Factors” included in our Annual Report, for additional information on the risks associated with our intellectual property and our competition risks.
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RESULTS OF OPERATIONS
Our unaudited operating results for the three and nine months ended September 30, 2026 and 2025 were as follows:
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | Change | 2026 | 2025 | Change | |||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||||||||
| Product sales | $ | 1,371 | $ | 1,277 | $ | 94 | $ | 3,999 | $ | 3,682 | $ | 317 | |||||||||||||||||||||||
| Other revenues | 4 | 4 | — | 14 | 14 | — | |||||||||||||||||||||||||||||
| 1,375 | 1,281 | 94 | 4,013 | 3,696 | 317 | ||||||||||||||||||||||||||||||
| Expenses | |||||||||||||||||||||||||||||||||||
Cost of goods sold (excluding amortization and impairments of intangible assets) | 485 | 509 | (24) | 1,494 | 1,513 | (19) | |||||||||||||||||||||||||||||
| Cost of other revenues | 1 | 1 | — | 2 | 4 | (2) | |||||||||||||||||||||||||||||
| Selling, general and administrative (Note 4) | 556 | 528 | 28 | 1,688 | 1,670 | 18 | |||||||||||||||||||||||||||||
| Research and development | 91 | 95 | (4) | 306 | 277 | 29 | |||||||||||||||||||||||||||||
| Amortization of intangible assets | 57 | 68 | (11) | 171 | 202 | (31) | |||||||||||||||||||||||||||||
| Other expense (income), net | 30 | (15) | 45 | 81 | 29 | 52 | |||||||||||||||||||||||||||||
| 1,220 | 1,186 | 34 | 3,742 | 3,695 | 47 | ||||||||||||||||||||||||||||||
| Operating income | 155 | 95 | 60 | 271 | 1 | 270 | |||||||||||||||||||||||||||||
| Interest income | 2 | 3 | (1) | 10 | 9 | 1 | |||||||||||||||||||||||||||||
| Interest expense | (95) | (101) | 6 | (285) | (323) | 38 | |||||||||||||||||||||||||||||
| Gain (loss) on extinguishment of debt | — | 3 | (3) | (1) | (6) | 5 | |||||||||||||||||||||||||||||
| Foreign exchange and other | (4) | (3) | (1) | (12) | (11) | (1) | |||||||||||||||||||||||||||||
| Income (loss) before provision for income taxes | 58 | (3) | 61 | (17) | (330) | 313 | |||||||||||||||||||||||||||||
| (Provision for) benefit from income taxes | (23) | (22) | (1) | (28) | 36 | (64) | |||||||||||||||||||||||||||||
| Net income (loss) | 35 | (25) | 60 | (45) | (294) | 249 | |||||||||||||||||||||||||||||
| Net income attributable to noncontrolling interest | (3) | (3) | — | (8) | (8) | — | |||||||||||||||||||||||||||||
| Net income (loss) attributable to Bausch + Lomb Corporation | $ | 32 | $ | (28) | $ | 60 | $ | (53) | $ | (302) | $ | 249 | |||||||||||||||||||||||
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Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
Revenues
Our revenues are primarily generated from product sales in the therapeutic areas of eye health that consist of: (i) branded pharmaceuticals, (ii) generic pharmaceuticals, (iii) OTC vitamin and supplement products and (iv) medical devices (contact lenses, IOLs and ophthalmic surgical equipment). Other revenues include alliance and service revenue from the licensing and co-promotion of products and contract service revenue. Contract service revenue is derived primarily from contract manufacturing for third parties and is not material. See Note 17, “SEGMENT INFORMATION” to our unaudited interim Condensed Consolidated Financial Statements for the disaggregation of revenues which depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by the economic factors of each category of customer contracts.
Our revenues were $1,375 million and $1,281 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $94 million, or 7%. The increase was attributable to: (i) increased volumes of $63 million across each of our segments, (ii) increased net realized pricing of $31 million, primarily driven by our Vision Care and Pharmaceuticals segments and (iii) incremental sales attributable to acquisitions of $8 million, within our Vision Care and Surgical segments. The increases in revenue were partially offset by: (i) the unfavorable impact of foreign currencies of $6 million and (ii) the impact of divestitures and discontinuations of $2 million primarily related to the discontinuation of certain products within our Vision Care segment.
The following table presents segment revenues, segment revenues as a percentage of total revenues and the period-over-period changes in segment revenues for the three months ended September 30, 2026 and 2025.
| 2026 | 2025 | Change | ||||||||||||||||||||||||||||||||||||
| (in millions) | Amount | Pct. | Amount | Pct. | Amount | Pct. | ||||||||||||||||||||||||||||||||
| Segment Revenues | ||||||||||||||||||||||||||||||||||||||
| Vision Care | $ | 774 | 56 | % | $ | 736 | 57 | % | $ | 38 | 5 | % | ||||||||||||||||||||||||||
| Pharmaceuticals | 367 | 27 | % | 330 | 26 | % | 37 | 11 | % | |||||||||||||||||||||||||||||
| Surgical | 234 | 17 | % | 215 | 17 | % | 19 | 9 | % | |||||||||||||||||||||||||||||
| Total revenues | $ | 1,375 | 100 | % | $ | 1,281 | 100 | % | $ | 94 | 7 | % | ||||||||||||||||||||||||||
Constant Currency Revenues and Constant Currency Revenue Growth (non-GAAP)
Constant Currency Revenue Growth, a non-GAAP measure, is defined as a change in Revenues (its most directly comparable GAAP financial measure) on a period-over-period basis adjusted for changes in foreign currency exchange rates (if applicable). The Company uses Constant Currency Revenues (non-GAAP) and Constant Currency Revenue Growth (non-GAAP) to assess performance of its reportable segments, and the Company in total, without the impact of foreign currency exchange fluctuations. The Company believes that such measures are useful to investors as they provide a supplemental period-to-period comparison.
Although changes in foreign currency exchange rates are part of our business, they are not within management’s control. Changes in foreign currency exchange rates, however, can mask positive or negative trends in the underlying business performance. The impact for changes in foreign currency exchange rates is determined as the difference in the current period reported revenues at their current period currency exchange rates and the current period reported revenues revalued using the monthly average currency exchange rates during the comparable prior period.
Non-GAAP financial measures and non-GAAP ratios are not prepared in accordance with GAAP nor do they have any standardized meaning under GAAP. In addition, other companies may use similarly titled non-GAAP financial measures and ratios that are calculated differently from the way we calculate such measures and ratios. Accordingly, the Company’s non-GAAP financial measures and ratios may not be comparable to such similarly titled non-GAAP financial measures and ratios used by other companies.
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The following table presents a reconciliation of Revenues to constant currency revenues (non-GAAP) and the period-over-period changes in constant currency revenue (non-GAAP) for the three months ended September 30, 2026 and 2025.
| Three Months Ended September 30, 2026 | Three Months Ended September 30, 2025 | Change in Constant Currency Revenue (Non-GAAP) | ||||||||||||||||||||||||||||||||||||
| Revenue as Reported | Changes in Exchange Rates | Constant Currency Revenue (Non-GAAP) | Revenue as Reported | |||||||||||||||||||||||||||||||||||
| (in millions) | Amount | Pct. | ||||||||||||||||||||||||||||||||||||
| Vision Care | $ | 774 | $ | 5 | $ | 779 | $ | 736 | $ | 43 | 6 | % | ||||||||||||||||||||||||||
| Pharmaceuticals | 367 | — | 367 | 330 | 37 | 11 | % | |||||||||||||||||||||||||||||||
| Surgical | 234 | 1 | 235 | 215 | 20 | 9 | % | |||||||||||||||||||||||||||||||
| Total | $ | 1,375 | $ | 6 | $ | 1,381 | $ | 1,281 | $ | 100 | 8 | % | ||||||||||||||||||||||||||
Vision Care Segment Revenue
The Vision Care segment revenue was $774 million and $736 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $38 million, or 5%. The increase was primarily driven by the performance of SiHy Daily lenses and Ultra® within our contact lens business and Lumify® and Artelac® within our consumer eye care business. This increase included: (i) an increase in net pricing of $21 million, (ii) an increase in volumes of $18 million and (iii) incremental sales from acquisitions of $6 million. These increases were partially offset by: (i) the unfavorable impact of foreign currencies of $5 million and (ii) the impact of divestitures and discontinuations of $2 million.
Pharmaceuticals Segment Revenue
The Pharmaceuticals segment revenue was $367 million and $330 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $37 million, or 11%. The increase was primarily driven by our branded pharmaceuticals business, driven by MIEBO®. This increase included: (i) an increase in volumes of $26 million and (ii) an increase in net pricing of $11 million.
Surgical Segment Revenue
The Surgical segment revenue was $234 million and $215 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $19 million, or 9%. The increase was primarily driven by growth in premium IOLs. This increase included: (i) an increase in volumes of $19 million and (ii) incremental sales from acquisitions of $2 million. These increases were partially offset by: (i) the unfavorable impact of foreign currencies of $1 million and (ii) a decrease in net realized pricing of $1 million.
Cash Discounts and Allowances, Chargebacks and Distribution Fees
As is customary in the health care industry, gross product sales are subject to a variety of deductions in arriving at net product sales. Provisions for these deductions are recognized concurrently with the recognition of gross product sales. These provisions include cash discounts and allowances, chargebacks and distribution fees, which are paid or credited to direct customers, as well as rebates and returns, which can be paid or credited to direct and indirect customers. Provision balances relating to amounts payable to direct customers are netted against trade receivables and balances relating to indirect customers are included in accrued liabilities.
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We actively manage these offerings, focusing on the incremental costs of our patient assistance programs, the level of discounting to non-retail accounts and identifying opportunities to minimize product returns. We also concentrate on managing our relationships with our payors and wholesalers, reviewing the ranges of our offerings and being disciplined as to the amount and type of incentives we negotiate. Provisions recorded to reduce gross product sales to net product sales and revenues for the three months ended September 30, 2026 and 2025 were as follows:
| Three Months Ended September 30, | ||||||||||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||||||||
| (in millions) | Amount | Pct. | Amount | Pct. | ||||||||||||||||||||||
| Gross product sales | $ | 2,307 | 100.0 | % | $ | 2,114 | 100.0 | % | ||||||||||||||||||
| Provisions to reduce gross product sales to net product sales | ||||||||||||||||||||||||||
| Discounts and allowances | 125 | 5.40 | % | 121 | 5.70 | % | ||||||||||||||||||||
| Returns | 12 | 0.50 | % | 21 | 1.00 | % | ||||||||||||||||||||
| Rebates | 565 | 24.50 | % | 514 | 24.30 | % | ||||||||||||||||||||
| Chargebacks | 209 | 9.10 | % | 156 | 7.40 | % | ||||||||||||||||||||
| Distribution fees | 25 | 1.10 | % | 25 | 1.20 | % | ||||||||||||||||||||
| Total provisions | 936 | 40.60 | % | 837 | 39.60 | % | ||||||||||||||||||||
| Net product sales | 1,371 | 59.40 | % | 1,277 | 60.40 | % | ||||||||||||||||||||
| Other revenues | 4 | 4 | ||||||||||||||||||||||||
| Revenues | $ | 1,375 | $ | 1,281 | ||||||||||||||||||||||
Cash discounts and allowances, returns, rebates, chargebacks and distribution fees as a percentage of gross product sales were 40.6% and 39.6% for the three months ended September 30, 2026 and 2025, respectively, an increase of 1.0% percentage point, and is primarily attributable to product mix.
Operating Expenses
Cost of Goods Sold (exclusive of amortization and impairments of intangible assets)
Cost of goods sold primarily includes: manufacturing and packaging; the cost of products we purchase from third parties; royalty payments we make to third parties; depreciation of manufacturing facilities and equipment; and lower of cost or market adjustments to inventories. Cost of goods sold typically vary between periods as a result of product mix, volume, royalties, changes in foreign currency and inflation. Cost of goods sold excludes the amortization and impairments of intangible assets.
Cost of goods sold was $485 million and $509 million for the three months ended September 30, 2026 and 2025, respectively, a decrease of $24 million, or 5%. The decrease was primarily driven by: (i) the amortization of inventory step-up related to the acquisition of XIIDRA® during the three months ended September 30, 2025 and (ii) $14 million of recoveries related to previously paid tariffs during the three months ended September 30, 2026.
Contribution (product sales revenue less cost of goods sold, exclusive of amortization and impairments of intangible assets) increased by $118 million and Cost of goods sold as a percentage of Product sales was 35.4% and 39.9% for the three months ended September 30, 2026 and 2025, respectively. The favorable change was primarily driven by product mix, from higher margin brands, and the decrease in cost of goods sold, as previously discussed.
Selling, General and Administrative Expenses
Selling, general and administrative ("SG&A") expenses primarily include: employee compensation associated with sales and marketing, finance, legal, information technology, human resources and other administrative functions; certain outside legal fees and consultancy costs; product promotion expenses; overhead and occupancy costs; depreciation of corporate facilities and equipment; and other general and administrative costs.
SG&A expenses were $556 million and $528 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $28 million, or 5%. The increase was primarily attributable to higher selling expense in our Vision Care and Surgical segments, partially offset by lower Business Transformation Costs (as defined and discussed below).
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Research and Development Expenses
Included in R&D are costs related to our product development and quality assurance programs. Expenses related to product development include: employee compensation costs; overhead and occupancy costs; depreciation of research and development facilities and equipment; clinical trial costs; clinical manufacturing and scale-up costs; and other third-party development costs. Quality assurance are the costs incurred to meet evolving customer and regulatory standards and include: employee compensation costs; overhead and occupancy costs; amortization of software; and other third-party costs.
R&D expenses were $91 million and $95 million for the three months ended September 30, 2026 and 2025, respectively, a decrease of $4 million, or 4%.
Amortization of Intangible Assets
Intangible assets with finite lives are amortized using the straight-line method over their estimated useful lives. Management continually assesses the useful lives related to our long-lived assets to reflect the most current assumptions.
Amortization of Intangible assets was $57 million and $68 million for the three months ended September 30, 2026 and 2025, respectively, a decrease of $11 million, or 16%, primarily due to fully amortized intangible assets no longer being amortized.
See Note 8, “INTANGIBLE ASSETS AND GOODWILL” to our unaudited interim Condensed Consolidated Financial Statements for further details related to the Amortization of intangible assets.
Other expense (income), net
Other expense (income), net for the three months ended September 30, 2026 and 2025 consists of the following:
| Three Months Ended September 30, | ||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | ||||||||||||||||||||||||
| Asset impairments | $ | 4 | $ | — | ||||||||||||||||||||||
| Restructuring, integration and separation costs | 9 | 11 | ||||||||||||||||||||||||
| Gain on sale of assets | — | (6) | ||||||||||||||||||||||||
| Litigation and other matters | 8 | 1 | ||||||||||||||||||||||||
| Acquired in-process research and development costs | — | — | ||||||||||||||||||||||||
| Acquisition-related costs | 3 | 2 | ||||||||||||||||||||||||
| Acquisition-related contingent consideration | 6 | (23) | ||||||||||||||||||||||||
Other expense (income), net | $ | 30 | $ | (15) | ||||||||||||||||||||||
Acquisition-related contingent consideration in 2025 primarily reflects changes in the estimated amount and timing of projected cash flows of certain products.
Operating Income
Operating income was $155 million and $95 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $60 million. This increase primarily reflects the increase in contribution, as previously discussed.
Segment Profit
Segment profit is based on operating income after the elimination of intercompany transactions. Certain costs, such as Amortization of intangible assets and Other expense, net, are not included in the measure of segment profit, as management excludes these items in assessing segment financial performance. Segment profit is a measure of operating performance of our reportable segments and may not be comparable to similar measures reported by other companies. Segment profit is a performance metric utilized by the Company’s Interim Chief Executive Officer, who is the Company’s Chief Operating Decision Maker, to allocate resources to and assess performance of the Company’s segments. See Note 17, “SEGMENT INFORMATION” to our unaudited interim Condensed Consolidated Financial Statements for a reconciliation of segment profit to Income before provision for income taxes.
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The following table presents segment profits, segment profits as a percentage of segment revenues and the period-over-period changes in segment profits for the three months ended September 30, 2026 and 2025.
| 2026 | 2025 | Change | ||||||||||||||||||||||||||||||||||||
| (in millions) | Amount | Pct. | Amount | Pct. | Amount | Pct. | ||||||||||||||||||||||||||||||||
| Segment Profits / Segment Profit Margins | ||||||||||||||||||||||||||||||||||||||
| Vision Care | $ | 244 | 32 | % | $ | 217 | 29 | % | $ | 27 | 12 | % | ||||||||||||||||||||||||||
| Pharmaceuticals | 134 | 37 | % | 76 | 23 | % | 58 | 76 | % | |||||||||||||||||||||||||||||
| Surgical | 32 | 14 | % | 8 | 4 | % | 24 | 300 | % | |||||||||||||||||||||||||||||
Vision Care Segment Profit
The Vision Care segment profit was $244 million and $217 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $27 million. The increase was primarily driven by: (i) the increase in revenue, as previously discussed, (ii) higher gross profit driven by product mix in our Consumer business and a one-time tariff refund in our Lens business. These increases were partially offset by an increase in selling expense.
Pharmaceuticals Segment Profit
The Pharmaceuticals segment profit was $134 million and $76 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $58 million. The increase was primarily driven by: (i) the increase in revenues, as previously discussed, (ii) the impact of the amortization of inventory step-up related to the acquisition of XIIDRA® during the three months ended September 30, 2025 and (iii) improved operating efficiencies.
Surgical Segment Profit
The Surgical segment profit was $32 million and $8 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $24 million. The increase was primarily due to the increase in revenues, as previously discussed, and higher gross profit primarily driven by the shift to premium IOLs, partially offset by higher selling expense.
Non-Operating Income and Expense
Interest Expense
Interest expense primarily consists of interest payments due, amortization of debt discounts and deferred issuance costs on indebtedness under our credit facilities.
Interest expense was $95 million and $101 million for the three months ended September 30, 2026 and 2025, respectively, a decrease of $6 million, primarily driven by lower interest rates on the Company's January 2031 Refinancing Term Facility, as defined below, as compared to the term facilities outstanding during 2025. See Note 10, “FINANCING ARRANGEMENTS” to our unaudited interim Condensed Consolidated Financial Statements for further details regarding our financing arrangements.
Loss on Extinguishment of Debt
Loss on extinguishment of debt represents the differences between the amounts paid to settle extinguished debts and the carrying value of the related extinguished debt. Loss on extinguishment of debt was a credit of $3 million for the three months ended September 30, 2025, which reflects a true-up related to our June 2025 Credit Facility Amendment, as defined below.
Foreign Exchange and Other
Foreign exchange and other primarily includes translation gains/losses on intercompany balances and third-party liabilities and the gain/loss due to the change in fair value of foreign currency exchange contracts. Foreign exchange and other was a net loss of $4 million and $3 million for the three months ended September 30, 2026 and 2025, respectively.
Income Taxes
Provision for income taxes was $23 million and $22 million for the three months ended September 30, 2026 and 2025, respectively, an unfavorable change of $1 million. The change in income taxes was primarily related to: (i) a change in the jurisdictional and seasonal mix of earnings and (ii) the discrete tax effect of an adjustment to deferred tax assets reported on an income tax return filed in the quarter.
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See Note 14, “INCOME TAXES” to our unaudited interim Condensed Consolidated Financial Statements for further details.
Net income (loss) attributable to Bausch + Lomb Corporation
Net income attributable to Bausch + Lomb Corporation was $32 million for the three months ended September 30, 2026 as compared to a net loss attributable to Bausch + Lomb Corporation of $28 million for the three months ended September 30, 2025, an increase in our results of $60 million and was primarily due to the increase in our operating results of $60 million and decrease in interest expense of $6 million, partially offset by the increase in income taxes of $1 million, each as previously discussed.
Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
Revenues
Our revenues were $4,013 million and $3,696 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $317 million, or 9%. The increase was attributable to: (i) increased volumes of $139 million across each of our segments, (ii) increased net realized pricing of $128 million, driven by our Pharmaceuticals and Vision Care segments, (iii) the favorable impact of foreign currencies of $48 million and (iv) incremental sales attributable to acquisitions of $12 million, within our Vision Care and Surgical segments. The increases in revenue were partially offset by the impact of divestitures and discontinuations of $10 million, primarily relating to the discontinuation of certain products within our Vision Care segment.
The following table presents segment revenues, segment revenues as a percentage of total revenues and the period-over-period changes in segment revenues for the nine months ended September 30, 2026 and 2025.
| 2026 | 2025 | Change | ||||||||||||||||||||||||||||||||||||
| (in millions) | Amount | Pct. | Amount | Pct. | Amount | Pct. | ||||||||||||||||||||||||||||||||
| Segment Revenues | ||||||||||||||||||||||||||||||||||||||
| Vision Care | $ | 2,269 | 56 | % | $ | 2,145 | 58 | % | $ | 124 | 6 | % | ||||||||||||||||||||||||||
| Pharmaceuticals | 1,026 | 26 | % | 906 | 25 | % | 120 | 13 | % | |||||||||||||||||||||||||||||
| Surgical | 718 | 18 | % | 645 | 17 | % | 73 | 11 | % | |||||||||||||||||||||||||||||
| Total revenues | $ | 4,013 | 100 | % | $ | 3,696 | 100 | % | $ | 317 | 9 | % | ||||||||||||||||||||||||||
Constant Currency Revenues and Constant Currency Revenue Growth (non-GAAP)
The following table presents a reconciliation of Revenues to constant currency revenues (non-GAAP) and the period-over-period changes in constant currency revenue (non-GAAP) for the nine months ended September 30, 2026 and 2025. Constant Currency Revenues (non-GAAP) and Constant Currency Revenue Growth (non-GAAP) are defined in the previous section titled “Constant Currency Revenues and Constant Currency Revenue Growth (non-GAAP)”.
| Nine Months Ended September 30, 2026 | Nine Months Ended September 30, 2025 | Change in Constant Currency Revenue (Non-GAAP) | |||||||||||||||||||||||||||||||||||||||
| Revenue as Reported | Changes in Exchange Rates | Constant Currency Revenue (Non-GAAP) | Revenue as Reported | ||||||||||||||||||||||||||||||||||||||
| (in millions) | Amount | Pct. | |||||||||||||||||||||||||||||||||||||||
| Vision Care | $ | 2,269 | $ | (24) | $ | 2,245 | $ | 2,145 | $ | 100 | 5 | % | |||||||||||||||||||||||||||||
| Pharmaceuticals | 1,026 | (7) | 1,019 | 906 | 113 | 12 | % | ||||||||||||||||||||||||||||||||||
| Surgical | 718 | (17) | 701 | 645 | 56 | 9 | % | ||||||||||||||||||||||||||||||||||
| Total | $ | 4,013 | $ | (48) | $ | 3,965 | $ | 3,696 | $ | 269 | 7 | % | |||||||||||||||||||||||||||||
Vision Care Segment Revenue
The Vision Care segment revenue was $2,269 million and $2,145 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $124 million, or 6%. The increase was primarily driven by sales from our dry eye portfolio and Lumify® within our consumer eye care business and the performance of SiHy Daily lenses, Ultra® and Biotrue® within our contact lens business. This increase included: (i) an increase in net pricing of $60 million, (ii) an increase in volumes of $43 million, (iii) the favorable impact of foreign currencies of $24 million and (iv) incremental sales from acquisitions of $6 million, partially offset by the impact of discontinuations of $9 million.
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Pharmaceuticals Segment Revenue
The Pharmaceuticals segment revenue was $1,026 million and $906 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $120 million, or 13%. The increase was primarily driven by: (i) our branded pharmaceuticals business, driven by MIEBO® and XIIDRA® and (ii) increased sales in our international pharmaceuticals business. The increase included: (i) an increase in net realized pricing of $71 million, (ii) an increase in volumes of $43 million and (iii) the favorable impact of foreign currencies of $7 million, partially offset by the impact of discontinuations of $1 million.
Surgical Segment Revenue
The Surgical segment revenue was $718 million and $645 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $73 million, or 11%. The increase was primarily driven by growth in premium IOLs, which reflects continued growth since the 2025 voluntary recall of certain enVista® IOL products and growth in consumables. This increase included: (i) an increase in volumes of $53 million, (ii) the favorable impact of foreign currencies of $17 million and (iii) incremental sales from acquisitions of $6 million, partially offset by a decrease in net realized pricing of $3 million.
Cash Discounts and Allowances, Chargebacks and Distribution Fees
Provisions recorded to reduce gross product sales to net product sales and revenues for the nine months ended September 30, 2026 and 2025 were as follows:
| Nine Months Ended September 30, | ||||||||||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||||||||
| (in millions) | Amount | Pct. | Amount | Pct. | ||||||||||||||||||||||
| Gross product sales | $ | 6,496 | 100.0 | % | $ | 6,050 | 100.0 | % | ||||||||||||||||||
| Provisions to reduce gross product sales to net product sales | ||||||||||||||||||||||||||
| Discounts and allowances | 369 | 5.70 | % | 346 | 5.70 | % | ||||||||||||||||||||
| Returns | 56 | 0.90 | % | 53 | 0.90 | % | ||||||||||||||||||||
| Rebates | 1,439 | 22.10 | % | 1,446 | 23.80 | % | ||||||||||||||||||||
| Chargebacks | 567 | 8.70 | % | 451 | 7.50 | % | ||||||||||||||||||||
| Distribution fees | 66 | 1.00 | % | 72 | 1.20 | % | ||||||||||||||||||||
| Total provisions | 2,497 | 38.40 | % | 2,368 | 39.10 | % | ||||||||||||||||||||
| Net product sales | 3,999 | 61.60 | % | 3,682 | 60.90 | % | ||||||||||||||||||||
| Other revenues | 14 | 14 | ||||||||||||||||||||||||
| Revenues | $ | 4,013 | $ | 3,696 | ||||||||||||||||||||||
Cash discounts and allowances, returns, rebates, chargebacks and distribution fees as a percentage of gross product sales were 38.4% and 39.1% for the nine months ended September 30, 2026 and 2025, respectively, a decrease of 0.7% percentage points, and is primarily attributable to a decline in rebates, primarily driven by XIIDRA®.
Operating Expenses
Cost of Goods Sold (exclusive of amortization and impairments of intangible assets)
Cost of goods sold was $1,494 million and $1,513 million for the nine months ended September 30, 2026 and 2025, respectively, a decrease of $19 million, or 1%. The decrease was primarily driven by: (i) the amortization of inventory step-up related to the acquisition of XIIDRA® and impact of the voluntary recall of certain enVista® IOL products during the nine months ended September 30, 2025 and (ii) $15 million of recoveries related to previously paid tariffs during the nine months ended September 30, 2026.
Contribution (product sales revenue less cost of goods sold, exclusive of amortization and impairments of intangible assets) increased by $336 million and Cost of goods sold as a percentage of Product sales was 37.4% and 41.1% for the nine months ended September 30, 2026 and 2025, respectively. The favorable change was primarily driven by: (i) product mix, (ii) the favorable impact of foreign currencies to revenues and (iii) the decrease in cost of goods sold, as previously discussed.
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Selling, General and Administrative Expenses
SG&A expenses were $1,688 million and $1,670 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $18 million, or 1%. The increase was primarily attributable to: (i) higher selling expense in our Vision Care and Surgical segments, (ii) higher G&A costs and (iii) the unfavorable impact of foreign currencies on this expense. These increases were partially offset by: (i) lower Business Transformation Costs (as defined below) and (ii) lower advertising and promotional expense as XIIDRA® and MIEBO® have exited the launch phase.
Research and Development Expenses
R&D expenses were $306 million and $277 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $29 million, or 10%, primarily due to certain products in development, as previously discussed.
Amortization of Intangible Assets
Amortization of Intangible assets was $171 million and $202 million for the nine months ended September 30, 2026 and 2025, respectively, a decrease of $31 million, or 15%, primarily due to fully amortized intangible assets no longer being amortized.
See Note 8, “INTANGIBLE ASSETS AND GOODWILL” to our unaudited interim Condensed Consolidated Financial Statements for further details related to the Amortization of intangible assets.
Other expense, net
Other expense, net for the nine months ended September 30, 2026 and 2025 consists of the following:
| Nine Months Ended September 30, | ||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | ||||||||||||||||||||||||
| Asset impairments | $ | 13 | $ | — | ||||||||||||||||||||||
| Restructuring, integration and separation costs | 21 | 43 | ||||||||||||||||||||||||
| Gain on sale of assets | (3) | (6) | ||||||||||||||||||||||||
| Litigation and other matters | 20 | 8 | ||||||||||||||||||||||||
| Acquired in-process research and development costs | 16 | 29 | ||||||||||||||||||||||||
| Acquisition-related costs | 4 | 5 | ||||||||||||||||||||||||
| Acquisition-related contingent consideration | 10 | (50) | ||||||||||||||||||||||||
Other expense, net | $ | 81 | $ | 29 | ||||||||||||||||||||||
Acquired in-process research and development costs in 2025 primarily relate to the acquisition of Whitecap Biosciences, as previously discussed.
Operating Income
Operating income was $271 million and $1 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $270 million. This increase primarily reflects the increase in contribution, as previously discussed.
Segment Profit
The following table presents segment profits, segment profits as a percentage of segment revenues and the period-over-period changes in segment profits for the nine months ended September 30, 2026 and 2025.
| 2026 | 2025 | Change | ||||||||||||||||||||||||||||||||||||
| (in millions) | Amount | Pct. | Amount | Pct. | Amount | Pct. | ||||||||||||||||||||||||||||||||
| Segment Profits / Segment Profit Margins | ||||||||||||||||||||||||||||||||||||||
| Vision Care | $ | 675 | 30 | % | $ | 602 | 28 | % | $ | 73 | 12 | % | ||||||||||||||||||||||||||
| Pharmaceuticals | 289 | 28 | % | 124 | 14 | % | 165 | 133 | % | |||||||||||||||||||||||||||||
| Surgical | 58 | 8 | % | 3 | — | % | 55 | 1,833 | % | |||||||||||||||||||||||||||||
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Vision Care Segment Profit
The Vision Care segment profit was $675 million and $602 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $73 million. The increase was primarily driven by the increase in gross profit, primarily from increased revenues and a tariff recovery, each as previously discussed, partially offset by higher selling expense.
Pharmaceuticals Segment Profit
The Pharmaceuticals segment profit was $289 million and $124 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $165 million. The increase was primarily driven by: (i) the increase in revenues, as previously discussed, (ii) the impact of the amortization of inventory step-up related to the acquisition of XIIDRA® during 2025 and (iii) improved operating efficiencies, driven by lower advertising and promotional expense as XIIDRA® and MIEBO® have exited the launch phase. These increases were partially offset by higher R&D expense.
Surgical Segment Profit
The Surgical segment profit was $58 million and $3 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $55 million. The increase was primarily due to: (i) the increase in revenues, as previously discussed, (ii) higher gross profit primarily driven by the shift to premium IOLs and (iii) the enVista® recall which impacted 2025, partially offset by higher selling expense.
Non-Operating Income and Expense
Interest Expense
Interest expense was $285 million and $323 million for the nine months ended September 30, 2026 and 2025, respectively, a decrease of $38 million. The decrease was primarily attributable to: (i) the write-off of financing costs associated with the June 2025 Credit Facility Amendment, as defined below and (ii) lower interest rates on the Company's January 2031 Refinancing Term Facility, as defined below, as compared to the term facilities outstanding during 2025. See Note 10, “FINANCING ARRANGEMENTS” to our unaudited interim Condensed Consolidated Financial Statements for further details regarding our financing arrangements.
Loss on Extinguishment of Debt
Loss on extinguishment of debt was $1 million and $6 million for the nine months ended September 30, 2026 and 2025, respectively, as a result of the January 2026 Credit Facility Amendment and June 2025 Credit Facility Amendment, each as defined below.
Foreign Exchange and Other
Foreign exchange and other was a net loss of $12 million and $11 million for the nine months ended September 30, 2026 and 2025, respectively.
Income Taxes
Provision for income taxes was $28 million for the nine months ended September 30, 2026, as compared to a benefit from income taxes of $36 million for the nine months ended September 30, 2025, an unfavorable change of $64 million. The change in income taxes was primarily related to: (i) a change in the jurisdictional mix of earnings resulting in a benefit in the prior year offset by the (ii) discrete tax effects of: (a) a current year benefit related to a favorable settlement in a foreign jurisdiction and (b) the tax effects of acquired tax intangibles and net operating losses recorded in the current year.
See Note 14, “INCOME TAXES” to our unaudited interim Condensed Consolidated Financial Statements for further details.
Net loss attributable to Bausch + Lomb Corporation
Net loss attributable to Bausch + Lomb Corporation for the nine months ended September 30, 2026 and 2025 was $53 million and $302 million, respectively, an increase in our results of $249 million and was primarily driven by the increase in our operating results of $270 million and decrease in interest expense of $38 million, partially offset by the increase in the provision for income taxes of $64 million, each as previously discussed.
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LIQUIDITY AND CAPITAL RESOURCES
Cash Flows
| Nine Months Ended September 30, | ||||||||||||||||||||
| (in millions) | 2026 | 2025 | Change | |||||||||||||||||
| Net cash provided by operating activities | $ | 418 | $ | 147 | $ | 271 | ||||||||||||||
| Net cash used in investing activities | (290) | (267) | (23) | |||||||||||||||||
| Net cash (used in) provided by financing activities | (8) | 109 | (117) | |||||||||||||||||
| Effect of exchange rate changes on cash and cash equivalents and restricted cash | (2) | 27 | (29) | |||||||||||||||||
| Net increase in cash and cash equivalents and restricted cash | 118 | 16 | 102 | |||||||||||||||||
| Cash and cash equivalents and restricted cash, beginning of period | 397 | 316 | 81 | |||||||||||||||||
| Cash and cash equivalents and restricted cash, end of period | $ | 515 | $ | 332 | $ | 183 | ||||||||||||||
Operating Activities
Net cash provided by operating activities was $418 million and $147 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $271 million, and is primarily attributable to the increase in our operating results, as previously discussed, partially offset by the timing of payments in the normal course of business.
Investing Activities
Net cash used in investing activities was $290 million and $267 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $23 million. The increase was primarily driven by an increase in Acquisition and other investments of $63 million, of which $35 million related to a milestone payment during the nine months ended September 30, 2026, after achieving an annual sales-based milestone for MIEBO®, under the terms of a December 2019 license agreement with Novaliq GmbH. The increase was partially offset by a decrease in purchases of property, plant and equipment during the nine months ended September 30, 2026.
Financing Activities
Net cash used in financing activities was $8 million for the nine months ended September 30, 2026, as compared to net cash provided by financing activities of $109 million for the nine months ended September 30, 2025, a decrease of $117 million. The decrease is primarily attributable to borrowings under the May 2027 Revolving Credit Facility (as defined below), during the nine months ended September 30, 2025.
Liquidity and Debt
Future Sources of Liquidity
Our primary sources of liquidity are expected to be our cash and cash equivalents, cash collected from customers, funds as needed from our June 2030 Revolving Credit Facility, and issuances of other long-term debt, additional equity and equity-linked securities. In addition, as part of our ongoing working capital management, on January 9, 2026, we entered into a financing arrangement, that permits us, subject to certain conditions, to sell certain receivables to a third-party financial institution, potentially accelerating access to cash and reducing our credit risk. During the nine months ended September 30, 2026, the Company sold trade receivables and received cash proceeds totaling $26 million, under this arrangement, which were then collected and remitted to the financial institution as of September 30, 2026.
We believe these sources will be sufficient to meet our current liquidity needs for the next twelve months, from the date of this filing, and be sufficient to support our future cash needs; however, we can provide no assurance that our liquidity and capital resources will meet future funding requirements.
The global financial markets recently have undergone and may continue to experience significant volatility and disruption. The timing and sustainability of an economic recovery is uncertain and additional macroeconomic, business and financial disruptions may arise. As markets change, there can be no assurance that the challenging economic environment or a further economic downturn would not impact our liquidity or our ability to obtain future financing on reasonable terms or at all.
We regularly evaluate market conditions, our liquidity profile and various financing alternatives for opportunities to enhance our capital structure. If opportunities are favorable, we may from time to time enter into new financing arrangements, refinance the Senior Secured Credit Facilities (as defined below) or repurchase debt, or issue additional equity and equity-linked securities.
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Long-term Debt
On May 10, 2022, Bausch + Lomb entered into a credit agreement (the “Original Credit Agreement”), providing for a term loan of $2,500 million (the “May 2027 Term Facility”) and a revolving credit facility of $500 million (the “May 2027 Revolving Credit Facility”).
On September 29, 2023, Bausch + Lomb entered into an incremental term loan facility in the form of an incremental amendment (the “September 2023 Credit Facility Amendment”) to the credit agreement and consisted of borrowings of $500 million in new term B loans with a five-year term to maturity (the “September 2028 Term Facility”). In addition, on September 29, 2023, Bausch + Lomb also issued $1,400 million aggregate principal amount of 8.375% Senior Secured Notes due October 2028 (the “October 2028 Secured Notes”).
On November 1, 2024, Bausch + Lomb entered into an additional incremental term loan facility secured on a pari passu basis with the Company’s existing May 2027 Term Facility and September 2028 Term Facility. This incremental term loan facility was entered into in the form of an incremental amendment (the “November 2024 Credit Facility Amendment”) to our credit agreement and consisted of borrowing $400 million of new term loans with a maturity of May 2027 (the “May 2027 Incremental Term Facility”).
On June 26, 2025, Bausch + Lomb entered into an incremental amendment (the “June 2025 Credit Facility Amendment”) to our credit agreement, which consisted of a new $800 million revolving credit facility maturing June 26, 2030 (the “June 2030 Revolving Credit Facility”) and a new $2,325 million term B loan facility maturing January 15, 2031 (the “January 2031 Term Facility”). In addition, on June 26, 2025, Bausch + Lomb’s subsidiaries, Bausch + Lomb Netherlands B.V. and Bausch & Lomb Incorporated, issued €675 million aggregate principal amount of Senior Secured Floating Rate Notes due January 2031 (the “January 2031 Secured Notes” and, together with the October 2028 Secured Notes, the “Senior Secured Notes”). The January 2031 Secured Notes accrue interest at a rate per annum of: (i) three-month EURIBOR (subject to a 0% floor) plus (ii) 3.875%, reset quarterly, payable quarterly in arrears on January 15, April 15, July 15 and October 15 of each year, commencing on January 15, 2026. At September 30, 2026, the January 2031 Secured Notes bore interest at 6.31% per annum.
The proceeds from the January 2031 Secured Notes, along with the proceeds of the January 2031 Term Facility, were used by the Company to: (i) repay in full outstanding borrowings under the May 2027 Revolving Credit Facility, (ii) refinance, in full, its outstanding term loans due 2027 (the May 2027 Term Facility and May 2027 Incremental Term Facility) and (iii) pay related fees and expenses.
On January 2, 2026, the Company entered into a refinancing transaction amendment (the “January 2026 Credit Facility Amendment”; the Original Credit Agreement, as amended by the September 2023 Credit Facility Amendment, the November 2024 Credit Facility Amendment, the June 2025 Credit Facility Amendment and the January 2026 Credit Facility Amendment, the “Amended Credit Agreement”) providing for a new $2,802 million term loan facility maturing on January 15, 2031 (the “January 2031 Refinancing Term Facility” or the “Term Facilities”; the Term Facilities, together with the June 2030 Revolving Credit Facility, the “Senior Secured Credit Facilities”). The Company used the proceeds from the January 2031 Refinancing Term Facility to refinance, in full, its outstanding term loans (September 2028 Term Facility and January 2031 Term Facility).
The Senior Secured Credit Facilities are secured by substantially all of the assets of Bausch + Lomb and its material, wholly-owned Canadian, U.S., Dutch and Irish subsidiaries, subject to certain exceptions. The Term Facilities are denominated in U.S. dollars, and borrowings under the June 2030 Revolving Credit Facility may be made available in U.S. dollars, euros, pounds sterling and Canadian dollars. As of September 30, 2026, the principal amounts outstanding under the January 2031 Refinancing Term Facility were $2,788 million.
As of September 30, 2026, the Company had $100 million of outstanding borrowings, $34 million of issued and outstanding letters of credit and remaining availability, subject to certain customary conditions, of $666 million under its June 2030 Revolving Credit Facility. The stated rate of interest for borrowings under the Revolving Credit Facility at September 30, 2026 ranges from 6.52% to 6.65% per annum.
Borrowings under the June 2030 Revolving Credit Facility in: (i) U.S. dollars bear interest at a rate per annum equal to, at Bausch + Lomb’s option, either: (a) a term SOFR-based rate or (b) a U.S. dollar base rate, (ii) Canadian dollars bear interest at a rate per annum equal to, at Bausch + Lomb’s option, either: (a) a term CORRA-based rate or (b) a Canadian dollar prime rate, (iii) euros bear interest at a rate per annum equal to EURIBOR and (iv) pounds sterling bear interest at a rate per annum equal to SONIA, in each case, plus an applicable margin. The applicable interest rate margins for borrowings under the June 2030 Revolving Credit Facility are between 0.75% to 1.75% with respect to U.S. dollar base rate or Canadian dollar prime rate borrowings and between 1.75% to 2.75% with respect to SOFR, CORRA, EURIBOR or SONIA borrowings based on Bausch + Lomb’s total net leverage ratio. In addition, Bausch + Lomb is required to pay commitment fees of 0.25% per annum in respect of the unutilized commitments under the June 2030 Revolving Credit Facility, payable quarterly in
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arrears. Bausch + Lomb is also required to pay letter of credit fees on the maximum amount available to be drawn under all outstanding letters of credit in an amount equal to the applicable margin on SOFR borrowings under the June 2030 Revolving Credit Facility on a per annum basis, payable quarterly in arrears, as well as customary fronting fees for the issuance of letters of credit and agency fees.
Borrowings under the January 2031 Refinancing Term Facility bear interest at a rate per annum equal to, at our option, either: (i) a term SOFR-based rate, plus an applicable margin of 3.75%, or (ii) a U.S. dollar base rate, plus an applicable margin of 2.75%. The stated rate of interest under the January 2031 Refinancing Term Facility at September 30, 2026 was 7.65% per annum.
Subject to certain exceptions and customary baskets set forth in the Amended Credit Agreement, Bausch + Lomb is required to make mandatory prepayments of the loans under Term Facilities under certain circumstances, including from: (i) 100% of the net cash proceeds of insurance and condemnation proceeds for property or asset losses (subject to reinvestment rights, decrease based on leverage ratios and net proceeds threshold), (ii) 100% of the net cash proceeds from the incurrence of debt (other than permitted debt as described in the Amended Credit Agreement), (iii) 50% of Excess Cash Flow (as defined in the Amended Credit Agreement) subject to decrease based on leverage ratios and subject to a threshold amount and (iv) 100% of net cash proceeds from asset sales (subject to reinvestment rights, decrease based on leverage ratios and net proceeds threshold). These mandatory prepayments may be used to satisfy future amortization.
The amortization rate for the January 2031 Refinancing Term Facility is 1.00% per annum, or $28 million, payable in quarterly installments, with the first installment paid on June 30, 2026. Bausch + Lomb may direct that prepayments be applied to such amortization payments in order of maturity. As of September 30, 2026, the remaining mandatory quarterly amortization payments for the January 2031 Refinancing Term Facility were $119 million through December 2030, with the remaining term loan balance being due in January 2031.
Weighted Average Stated Rate of Interest
The weighted average stated rate of interest for the Company’s outstanding debt obligations as of September 30, 2026 and December 31, 2025 was 7.63% and 7.70%, respectively.
Credit Ratings
As of the date of this filing, October 28, 2026, the credit ratings and outlook from Moody’s, S&P and Fitch for certain outstanding obligations of Bausch + Lomb were as follows:
| Rating Agency | Corporate Rating | Senior Secured Rating | Outlook | |||||||||||||||||
| Moody’s | B1 | Stable | ||||||||||||||||||
| Standard & Poor’s | B | B | Developing | |||||||||||||||||
| Fitch | B | BB | Rating Watch Evolving | |||||||||||||||||
Any downgrade in our corporate credit ratings or senior secured ratings may increase our cost of borrowing and may negatively impact our ability to raise additional debt capital.
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OFF-BALANCE SHEET ARRANGEMENTS AND CONTRACTUAL OBLIGATIONS
We have no off-balance sheet arrangements that have a material current effect or that are reasonably likely to have a material future effect on our results of operations, financial condition, capital expenditures, liquidity, or capital resources.
Other Future Cash Requirements
Our other future cash requirements relate to working capital, capital expenditures, business development transactions (including contingent consideration and milestone-based payments that may become payable upon the achievement of specified events), restructuring and integration, benefit obligations and litigation settlements. In addition, we may use cash to enter into licensing arrangements and/or to make strategic acquisitions. We regularly consider further acquisition opportunities, some of which could be sizable.
In addition to our working capital requirements, as of the date of this filing, October 28, 2026, we expect our primary cash requirements for the period October 1, 2026 through December 31, 2026 to include:
•Debt repayments and interest—We expect to make interest payments of approximately $130 million and mandatory debt amortization payments of $7 million for the period October 1, 2026 through December 31, 2026 under our Senior Secured Credit Facilities and may elect to make additional principal payments under certain circumstances. Further, in the ordinary course of business, we may borrow and repay amounts under our June 2030 Revolving Credit Facility to meet business needs, see Item 1A. Risk Factors—"Our indebtedness could adversely affect our business and our ability to meet our obligations” included in our Annual Report;
•Capital expenditures—We expect to make payments of approximately $60 million for property, plant and equipment for the period October 1, 2026 through December 31, 2026.
•Acquisitions—On October 8, 2026, the Company entered into an agreement to acquire certain ophthalmic surgical manufacturing businesses. The acquisition is expected to close during the fourth quarter of 2026 for an upfront cash payment of approximately $85 million, due at closing.
•On October 12, 2026, Brent Saunders, former Chief Executive Officer of the Company and a member of the Company’s Board, and the Board mutually agreed to Mr. Saunders’ departure from the Company. As part of the separation agreement between the Company and Mr. Saunders, dated as of October 11, 2026, (the “Separation Agreement”), Mr. Saunders will receive a lump-sum cash payment of approximately $75 million in the aggregate, that will be payable in accordance with the Separation Agreement.
Cost Savings Programs
The Company has been launching certain initiatives that may result in certain changes to, and investment in, its organizational structure and operations. The Company refers to the charges related to these initiatives as “Business Transformation Costs”. These costs are recorded in SG&A in the unaudited Condensed Consolidated Statements of Operations and include third-party advisory costs.
Further, we continue to evaluate opportunities to improve our operating performance and may initiate cost savings programs to streamline our operations and eliminate redundant processes and expenses. These cost savings programs may include, but are not limited to: (i) reducing headcount, (ii) eliminating real estate costs associated with unused or under-utilized facilities and (iii) implementing contribution margin improvement and other cost reduction initiatives. Although a specific plan does not exist at this time, we may identify and take additional exit and cost-rationalization restructuring actions in the future, the costs of which could be material.
Future Litigation
In the ordinary course of business, we are involved in litigation, claims, government inquiries, investigations, charges and proceedings. See Note 16, “LEGAL PROCEEDINGS” to our unaudited interim Condensed Consolidated Financial Statements for further details of these matters. Our ability to successfully defend the Company against pending and future litigation may impact cash flows.
Future Licensing Payments
In the ordinary course of business, we may enter into select licensing and collaborative agreements for the commercialization and/or development of unique products. In connection with these agreements, the Company may pay an upfront fee to secure the agreement and be subject to potential future milestone payments. See Note 20, “COMMITMENTS AND CONTINGENCIES” to our audited Consolidated Financial Statements for the year ended December 31, 2025, included in our Annual Report.
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OUTSTANDING SHARE DATA
Our common shares are listed on the TSX and the NYSE under the ticker symbol “BLCO”.
At October 21, 2026, we had 357,497,374 issued and outstanding common shares. In addition, as of October 21, 2026, we had outstanding approximately 7,200,000 stock options and 5,900,000 restricted share units that each represent the right of a holder to receive one of Bausch + Lomb’s common shares and 4,100,000 performance-based restricted share units that represent the right of a holder to receive a number of the Company’s common shares up to a specified maximum. A maximum of 9,300,000 common shares could be issued upon vesting of the performance-based restricted share units outstanding.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
Critical accounting policies and estimates are those policies and estimates that are most important and material to the preparation of our Condensed Consolidated Financial Statements, and which require management’s most subjective and complex judgment due to the need to select policies from among alternatives available, and to make estimates about matters that are inherently uncertain. Management has reassessed the critical accounting policies and estimates as disclosed in Note 2 to the audited Consolidated Financial Statements included in our Annual Report, and determined that there were no significant changes in our critical accounting policies and estimates during the nine months ended September 30, 2026.
NEW ACCOUNTING STANDARDS
None.
FORWARD-LOOKING STATEMENTS
Caution regarding forward-looking information and statements and “Safe-Harbor” statements under the U.S. Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws:
To the extent any statements made in this Form 10-Q contain information that is not historical, these statements are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and may be forward-looking information within the meaning defined under applicable Canadian securities laws (collectively, “forward-looking statements”).
These forward-looking statements relate to, among other things: our business strategy, business plans, business prospects and forecasts and changes thereto; product pipeline, prospective products and product approvals, expected launches of new products, product development and results of current and anticipated products; pending acquisitions; anticipated results from completed and pending acquisitions; anticipated revenues for our products; expected Research and Development (“R&D”) and marketing spend; our expected primary cash and working capital requirements for the remainder of 2026 and beyond; our plans for continued improvement in operational efficiency and the anticipated impact of such plans; our beliefs about our manufacturing facilities and relationships; the expected impact of the tariffs imposed (or proposed to be imposed) by the U.S. (including on the countries in which we do business and sectors in which we do business (including pharmaceuticals)) and counter-tariffs or other retaliatory measures imposed (or that may be imposed) on the U.S. by other countries and disruptions to global supply chains and other potential results as a result of these developments and the potential actions the Company may take to help mitigate the impact of the tariffs, counter-tariffs and other trade restrictions and the success of such actions and the Company’s ability to recover any tariffs that are eligible for refund claims and the impact that any such tariff recoveries may have on the Company’s business, financial condition, cash flows and results of operations; expected risks of loss of patent or regulatory exclusivity; our liquidity and our ability to satisfy our debt maturities as they become due; our ability to comply with the covenants contained in our Amended Credit Agreement and in the indentures governing our October 2028 Secured Notes, the January 2026 Credit Facility Amendment and January 2031 Secured Notes; any proposed pricing actions; exposure to foreign currency exchange rate changes and interest rate changes; the potential effects of the new legislation commonly referred to as One Big Beautiful Bill Act, including the impact of such legislation on the Company’s tax provision for both 2026 and future years; the potential impact of changes in U.S. and non-U.S. tax laws on the Company’s future tax liabilities and effective tax rate, including as a result of the implementation of the Organisation for Economic Co-operation and Development inclusive framework on Base Erosion and Profit Shifting and the protective measures proposed by the United States in response thereto; the outcome of contingencies, such as litigation, subpoenas, investigations, inspections, reviews, audits and regulatory proceedings and any expected indemnifications therefrom; the anticipated impact of the adoption of new accounting standards; general market conditions and economic uncertainty; our expectations regarding our financial performance, including our future financial and operating performance, revenues, expenses, gross margins and income taxes; our impairment assessments, including the assumptions used therein and the results thereof; the anticipated effect of current market conditions and recessionary pressures in one or more of our markets; the anticipated effect of macroeconomic factors, including inflation and fluctuations in exchange rates and interest rates as a result of the imposition of tariff and other trade protection measures; the anticipated
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impact from the conflict between Russia and Ukraine; the anticipated impact from the conflict involving Iran, by the U.S. and Israel and the related unrest in the Middle East region; and the anticipated separation from Bausch Health Companies Inc. (“BHC”), including the structure and expected timetable for completing such separation transaction.
Forward-looking statements can generally be identified by the use of words such as “believe,” “anticipate,” “expect,” “intend,” “estimate,” “plan,” “schedule,” “continue,” “future,” “will,” “may,” “can,” “might,” “could,” “would,” “should,” “target,” “potential,” “opportunity,” “designed,” “create,” “predict,” “project,” “timeline,” “forecast,” “outlook,” “guidance,” “seek,” “strive,” “suggest,” “prospective,” “propose,” “strategy,” “indicative,” “ongoing,” “likely,” “evolve,” “decrease” or “increase” and positive and negative variations thereof or other similar expressions. In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements may not be appropriate for other purposes. Although we have previously indicated certain of these statements set out herein, all of the statements in this Form 10-Q that contain forward-looking statements are qualified by these cautionary statements. These statements are based upon the current expectations and beliefs of management. Although we believe that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed on such statements. Certain material factors or assumptions are applied in making such forward-looking statements, including, but not limited to, factors and assumptions regarding the items previously outlined, those factors, risks and uncertainties outlined below and the assumption that none of these factors, risks and uncertainties will cause actual results or events to differ materially from those described in such forward-looking statements. Actual results may differ materially from those expressed or implied in such statements. Important factors, risks and uncertainties that could cause actual results to differ materially from these expectations include, among other things, the following:
•adverse economic conditions and other macroeconomic factors over which we have no or limited control, including heightened inflation and interest rates, slower growth or a potential recession, and foreign currency rates, which could adversely impact our revenues, expenses and resulting margins;
•risks associated with the imposition of and adverse changes to the U.S. duty, tariff and other trading policies on the countries in which we do business and sectors in which we do business (including pharmaceuticals), and the counter-duties, counter-tariffs and/or other counter-measures implemented in response by other countries, which are expected to increase our manufacturing, distribution and other operational costs due to the higher duties and tariffs and the increased economic risks and uncertainties to the global economy as a result of such tariffs and counter-tariffs and the potential trade wars and global supply chain issues that may be triggered by the tariff changes and changes in consumer habits as a result;
•risks associated with the actions the Company has taken or may take in response to tariffs, counter-tariffs and other trade restrictions in order to help mitigate their impact on the Company and its business, results of operations and financial condition (including the Company’s ability to recover any tariffs that may be eligible for refund claims), including the risk that such actions may not be successful in mitigating the impact in the manner anticipated or at all and the costs and other risks that may be incurred in taking such actions. There can be no assurance that any such actions will be successful in mitigating the impact of the applicable tariffs, counter-tariffs or other trade restrictions;
•trade conflicts, including current and future trade disputes between the United States and other countries;
•the challenges the Company faces following its initial public offering (the “B+L IPO”), including the challenges and difficulties associated with managing an independent, complex business, the limited transitional services still being provided by and to BHC, and any potential, actual or perceived conflict of interest of some of our directors and officers because of their equity ownership in BHC and/or because they also serve as directors of BHC;
•our status as a controlled company, and the possibility that BHC’s interest may conflict with our interests and the interests of our other securityholders and other stakeholders;
•risks and uncertainties associated with the appointment of our new Chairman and Interim Chief Executive Officer, including with respect to the demands of his overlapping role as chief executive officer of BHC and any actual or perceived conflicts of interest relating thereto and any potential changes to the Company's business strategies that he may implement and any potential disruption and uncertainty among management, employees, current and potential customers, other third parties with whom we do business and shareholders that such changes may create;
•risks and uncertainties associated with the proposed plan to separate Bausch + Lomb from BHC, which include, but are not limited to, the expected benefits and costs of the Separation (as defined below), the expected timing of completion of the Separation and its manner and terms (including that it may be consummated as a transfer of all or a portion of BHC’s remaining direct or indirect equity interest in Bausch + Lomb to its shareholders (the “Distribution”), a sale of the Company (a “Sale Transaction”) or another type of transaction), the expectation that
53
if the Separation is to be effected through the Distribution, it will be completed following the achievement of targeted debt leverage ratios, subject to receipt of applicable shareholder and other necessary approvals and other factors (including those factors described in BHC’s public filings), the ability to complete the Distribution considering the various conditions to the completion of the Distribution (some of which are outside the Company’s and BHC’s control, including conditions related to regulatory matters and receipt of applicable shareholder approvals), the impact of any potential sales or dispositions of our common shares by BHC (including in connection with a foreclosure on the Bausch + Lomb common shares owned by BHC or its subsidiary that are or may be pledged as collateral for certain of BHC’s or its subsidiary’s debt), that market or other conditions are no longer favorable to completing the transaction, that applicable shareholder, stock exchange, regulatory or other approval is not obtained on the terms or timelines anticipated or at all, business disruption during the pendency of, or following, the Separation, diversion of management time on Separation-related issues, retention of existing management team members, the reaction of customers and other parties to the Separation, the structure of the Distribution and/or a Sale Transaction, the qualification of the Distribution as a tax-free transaction for Canadian and/or U.S. federal income tax purposes (including whether or not an advance ruling from the Canada Revenue Agency and/or the Internal Revenue Service will be sought or obtained), the ability of the Company and BHC to satisfy the conditions required to maintain the tax-free status of the Distribution (some of which are beyond their control), other potential tax or other liabilities that may arise as a result of the Distribution, the potential dis-synergy costs resulting from the Separation, the impact of the Separation on relationships with customers, suppliers, employees and other business counterparties, general economic conditions, conditions in the markets the Company is engaged in, behavior of customers, suppliers and competitors, technological developments, as well as legal and regulatory rules affecting the Company’s business. In particular, the Company can offer no assurance that the Separation, Distribution and/or a Sale Transaction will occur at all, or that any such transactions will occur on the timelines or in the manner anticipated by the Company and BHC or that, even if consummated, the Company will realize the anticipated benefits from the Separation;
•ongoing or potential future litigation, claims, challenges and/or regulatory investigations challenging or otherwise relating to the B+L IPO and the proposed Separation from BHC and the costs, expenses, use of resources, diversion of management time and efforts, liability and damages that may result therefrom;
•pricing decisions that we have implemented or may in the future elect to implement at the direction of our pricing committees or otherwise;
•legislative or policy efforts, including those that may be introduced and passed by the U.S. Congress, designed to reduce patient out-of-pocket costs for medicines and other products, which could result in new mandatory rebates and discounts or other pricing restrictions, controls or regulations (including mandatory price reductions);
•ongoing oversight and review of our products and facilities by regulatory and governmental agencies, including periodic audits by the U.S. Food and Drug Administration (the “FDA”) and equivalent agencies outside of the United States and the results thereof;
•actions by the FDA or other regulatory authorities with respect to our products or facilities;
•compliance with the legal and regulatory requirements of our marketed products;
•our ability to comply with the financial and other covenants contained in our Amended Credit Agreement, the indentures governing our October 2028 Secured Notes and January 2031 Secured Notes and other current or future debt agreements, including the limitations, restrictions and prohibitions such covenants may impose on the way we conduct our business, including prohibitions on incurring additional debt if certain financial covenants are not met, our ability to draw under the June 2030 Revolving Credit Facility under our Amended Credit Agreement and restrictions on our ability to make certain investments and other restricted payments;
•any downgrade by rating agencies in our or BHC’s credit ratings, which may impact, among other things, our ability to raise debt and the cost of capital for additional debt issuances;
•changes in the assumptions used in connection with our impairment analyses or assessments, which would lead to a change in such impairment analyses and assessments and which could result in an impairment in the goodwill associated with any of our reporting units or impairment charges related to certain of our products or other intangible assets;
•the risks and uncertainties relating to acquisitions and other business development transactions we may pursue, seek to complete and/or complete, including risks that pending transactions may not close, risks that we may not realize the expected benefits of such acquisitions and transactions on a timely basis or at all, risks that pipeline products
54
acquired may not be commercialized as anticipated, and risks relating to any increased levels of debt as a result of debt incurred to finance certain of these acquisitions and transactions;
•the uncertainties associated with the acquisition and launch of new products, assets and businesses, including, but not limited to, our ability to provide the time, resources, expertise and funds required for the commercial launch of new products, the acceptance and demand for new products, the failure to obtain required regulatory approvals, clearances or authorizations, and the impact of competitive products and pricing, which could lead to material impairment charges;
•our ability or inability to extend the profitable life of our products, including through line extensions and other life-cycle programs;
•our ability to retain, motivate and recruit executives and other key employees;
•our ability to implement effective succession planning for our executives and other key employees;
•factors impacting our ability to achieve anticipated revenues for our products, including changes in anticipated marketing spend on such products and launch of competing products;
•factors impacting our ability to achieve anticipated market acceptance for our products, including the pricing of such products, effectiveness of promotional efforts, reputation of our products and launch of competing products;
•our ability to compete against companies that are larger and have greater financial, technical and human resources than we do, as well as other competitive factors, such as technological advances achieved, patents obtained and new products introduced by our competitors;
•the extent to which our products are reimbursed by government authorities, pharmacy benefit managers (“PBMs”) and other third-party payors; the impact our distribution, pricing and other practices may have on the decisions of such government authorities, PBMs and other third-party payors to reimburse our products; and the impact of obtaining or maintaining such reimbursement on the price and sales of our products;
•the inclusion of our products on formularies or our ability to achieve favorable formulary status, as well as the impact on the price and sales of our products in connection therewith;
•the consolidation of wholesalers, retail drug chains and other customer groups and the impact of such industry consolidation on our business;
•our ability to maintain strong relationships with physicians and other health care professionals;
•our eligibility for benefits under tax treaties and the continued availability of low effective tax rates for the business profits of certain of our subsidiaries;
•the implementation of the Organisation for Economic Co-operation and Development inclusive framework on Base Erosion and Profit Shifting, including the global minimum corporate tax rate, by the countries in which we operate, and the potential impact of protective measures proposed by the United States in response to the inclusive framework, including the Trump administration’s executive order and the agreement in principle among the United States and the other G7 countries, and any changes in tax laws by non-U.S. countries in response thereto;
•the impacts of the new legislation commonly referred to as One Big Beautiful Bill Act, including the effects on the Company’s tax provision for both 2026 and future years;
•the actions of our third-party partners or service providers of research, development, manufacturing, marketing, distribution or other services, including their compliance with applicable laws and contracts, which actions may be beyond our control or influence, and the impact of such actions on us;
•the risks associated with the international scope of our operations, including our presence in emerging markets and the challenges we face when entering and operating in new and different geographic markets (including the challenges created by new and different regulatory regimes in such countries and the need to comply with applicable anti-bribery and economic sanctions, laws and regulations);
•adverse global economic conditions and credit markets and foreign currency exchange uncertainty and volatility in certain of the countries in which we do business;
•political and economic instability and other ongoing uncertainties as a result of unrest, instability or changes in geopolitical conditions, including military or political conflicts, in or impacting the countries in which we do business;
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•risks associated with the ongoing conflict between Russia and Ukraine and the export controls, sanctions and other restrictive actions that have been or may be imposed by the United States, Canada, the EU and other countries against governmental and other entities and individuals in or associated with Russia, Belarus and parts of Ukraine, including its potential escalation and the potential impact on sales, earnings, market conditions and the ability of the Company to manage resources and historical investment in Russia;
•risks associated with the conflict between the U.S. and Israel and Iran and Iran-backed militant groups and the related unrest in the Middle East region, and the potential impact on our operations, sale of products and revenues in this region, as well as the potential macroeconomic impact of such conflict and related unrest (including fuel prices), which could adversely impact our operations, revenues, expenses and resulting margins;
•our ability to obtain, maintain and license sufficient intellectual property rights over our products and enforce and defend against challenges to such intellectual property;
•the introduction of generic, biosimilar or other competitors of our branded products and other products, including the introduction of products that compete against our products that do not have patent or data exclusivity rights;
•the expense, timing and outcome of pending or future legal and governmental proceedings, arbitrations, investigations, subpoenas, tax and other regulatory audits, examinations, reviews, inspections and regulatory proceedings against us or relating to us and settlements thereof;
•our ability to obtain components, raw materials or finished products supplied by third parties (some of which may be single-sourced) and other manufacturing and related supply difficulties, interruptions and delays;
•the disruption of delivery of our products and the routine flow of manufactured goods;
•potential work stoppages, slowdowns or other labor problems at our facilities and the resulting impact on our manufacturing, distribution and other operations;
•interest rate risks associated with our floating rate debt borrowings;
•our ability to effectively distribute our products and the effectiveness and success of our distribution arrangements;
•our ability to effectively promote our own products and those of our co-promotion partners;
•our ability to secure and maintain third-party research, development, manufacturing, licensing, marketing or distribution arrangements;
•the risk that our products could cause, or be alleged to cause, personal injury and adverse effects, leading to potential lawsuits, product liability claims and damages and/or recalls or withdrawals of products from the market;
•the mandatory or voluntary recall or withdrawal of our products from the market and the costs associated therewith;
•the availability of, and our ability to obtain and maintain, adequate insurance coverage and/or our ability to cover or insure against the total amount of the claims and liabilities we face, whether through third-party insurance or self-insurance;
•our indemnity agreements, which may result in an obligation to indemnify or reimburse the relevant counterparty, which amounts may be material;
•the difficulty in predicting the expense, timing and outcome within our legal and regulatory environment, including with respect to approvals by the FDA, Health Canada, the European Medicines Agency (“EMA”) and similar agencies in other jurisdictions, legal and regulatory proceedings and settlements thereof, the protection afforded by our patents and other intellectual and proprietary property, successful generic challenges to our products and infringement or alleged infringement of the intellectual property of others;
•the results of continuing safety and efficacy studies by industry and government agencies;
•the success of preclinical and clinical trials for our drug development pipeline or delays in clinical trials that adversely impact the timely commercialization of our pipeline products, as well as other factors impacting the commercial success of our products, which could lead to material impairment charges;
•uncertainties around the successful improvement and modification of our existing products and development of new products, which may require significant expenditures and efforts;
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•the results of management reviews of our research and development portfolio (including following the receipt of clinical results or feedback from the FDA or other regulatory authorities), which could result in terminations of specific projects which, in turn, could lead to material impairment charges;
•the seasonality of sales of certain of our products;
•declines in the pricing and sales volume of certain of our products that are distributed or marketed by third parties, over which we have no or limited control;
•compliance by us or our third-party partners and service providers (over whom we may have limited influence), or the failure by us or these third parties to comply, with health care “fraud and abuse” laws and other extensive regulation of our marketing, promotional and business practices (including with respect to pricing), worldwide anti-bribery laws (including the U.S. Foreign Corrupt Practices Act and the Canadian Corruption of Foreign Public Officials Act), worldwide economic sanctions and/or export laws, worldwide environmental laws and regulation and privacy and security regulations;
•the impact of any changes in or reforms to the legislation, laws, rules, regulation and guidance that apply to us and our businesses and products or the enactment of any new or proposed legislation, laws, rules, regulations or guidance that will impact or apply to us or our businesses or products;
•the impact of changes in federal laws and policy that have been and may be undertaken under the Trump administration;
•illegal distribution or sale of counterfeit versions of our products;
•our ability to adopt and integrate artificial intelligence solutions into various aspects of our business and operations responsibly and in compliance with applicable legislation, laws, rules, regulation and guidance;
•interruptions, breakdowns or breaches in our information technology systems; and
•risks in Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the U.S. Securities and Exchange Commission (“SEC”) and the Canadian Securities Administrators (the “CSA”) on February 18, 2026 and risks detailed from time to time in our other filings with the SEC and the CSA, as well as our ability to anticipate and manage the risks associated with the foregoing.
Additional information about these factors and about the material factors or assumptions underlying such forward-looking statements may be found in our Annual Report on Form 10-K for the year ended December 31, 2025, filed on February 18, 2026, under Item 1A. “Risk Factors”, under Item 1A. “Risk Factors” of Part II of this Form 10-Q and in the Company’s other filings with the SEC and the CSA. When relying on our forward-looking statements to make decisions with respect to the Company, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. These forward-looking statements speak only as of the date made. We undertake no obligation to update or revise any of these forward-looking statements to reflect events or circumstances after the date of this Form 10-Q or to reflect actual outcomes, except as required by law. We caution that, as it is not possible to predict or identify all relevant factors that may impact forward-looking statements, the foregoing list of important factors that may affect future results is not exhaustive and should not be considered a complete statement of all potential risks and uncertainties.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes to the Company's assessment of its sensitivity to market risks that affect the disclosures presented in the section entitled “Item 7A. Quantitative and Qualitative Disclosures About Market Risk” of our Annual Report.
Item 4. Controls and Procedures
Disclosure Controls and Procedures
Our management, with the participation of our Interim Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), has evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2026. Based on this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of September 30, 2026.
Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Exchange Act or under other applicable U.S. or Canadian securities laws or stock exchange rules is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Changes in Internal Control Over Financial Reporting
There were no changes in the Company’s internal controls over financial reporting that occurred during the three months ended September 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings
We are involved in legal proceedings from time to time in the ordinary course of our business. Based on information currently available and established reserves, we have no reason to believe that the ultimate resolution of any known legal proceeding will have a material adverse effect on our financial position, liquidity or results of operations. However, there can be no assurance that the outcome of any such legal proceeding will be favorable, and adverse results in certain of these legal proceedings could have a material adverse effect on our financial position, results of operations in any one reporting period, or liquidity.
For additional information, see Note 16, “LEGAL PROCEEDINGS” of notes to the unaudited interim Condensed Consolidated Financial Statements.
Item 1A. Risk Factors
Except as set forth below, there have been no material changes to the risk factors as disclosed in Item 1A. “Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2025, filed on February 18, 2026.
Our chairman and interim chief executive officer also serves as chief executive officer of BHC, and these overlapping roles may create competing demands on management time and attention and actual or perceived conflicts of interest, which, together with other potential disruptions caused by the transition to a new chief executive officer, could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares to decline.
In October 2026, we announced that Thomas Appio was appointed by our Board of Directors to serve as interim Chief Executive Officer, effective October 12, 2026, following the departure of our then-current chief executive officer, Brent Saunders. Mr. Appio also serves as chief executive officer and a member of the board of directors of BHC and, since August 2026, has served as Chairman of our Board of Directors. The overlapping roles at the Company and BHC may create competing demands on management time and attention, which could adversely impact us. In addition, these overlapping roles may result in conflicts, or the appearance of conflicts, with respect to matters involving or affecting both companies. See Item 1A. Risk Factors—"Some of our directors and officers may have actual or potential conflicts of interest because of their equity ownership in BHC, and some of our directors may have actual or potential conflicts of interest because they also serve as directors of BHC” included in our Annual Report. Furthermore, although Mr. Appio has previously served in various leadership roles at the company prior to the IPO and is deeply familiar with our business and the industry through this and his role as chief executive officer of BHC, leadership transitions can be inherently disruptive and may create uncertainty regarding future strategic direction. For example, our new chairman and interim chief executive officer may implement changes to our business strategies, which could create disruption and uncertainty among management, employees, current and potential customers, other third parties with whom we do business and shareholders. Any of these factors relating to the appointment of our new chairman and interim chief executive officer could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares to decline.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
There were no unregistered sales of equity securities, nor any purchases of our equity securities, by the Company during the three months ended September 30, 2026.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
None.
Item 5. Other Information
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Item 6. Exhibits
| 101.INS* | Inline XBRL Instance Document | ||||
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document | ||||
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | ||||
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document | ||||
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | ||||
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | ||||
| 104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | ||||
____________________________________
* Filed herewith.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Bausch + Lomb Corporation (Registrant) | ||||||||
| Date: | October 28, 2026 | /s/ THOMAS J. APPIO | ||||||
| Thomas J. Appio Interim Chief Executive Officer (Principal Executive Officer) | ||||||||
| Date: | October 28, 2026 | /s/ SAM ELDESSOUKY | ||||||
| Sam Eldessouky Executive Vice President and Chief Financial Officer (Principal Financial Officer) | ||||||||
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INDEX TO EXHIBITS
| Exhibit Number | Exhibit Description | ||||
| 101.INS* | Inline XBRL Instance Document | ||||
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document | ||||
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | ||||
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document | ||||
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | ||||
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | ||||
| 104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | ||||
____________________________________
* Filed herewith.
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Exhibit 10.1
CONSULTING AGREEMENT
Bausch + Lomb Corporation and Thomas W. Ross, Sr.
Effective Date | August 6, 2026 | ||||
Consultant | Thomas W. Ross, Sr. | ||||
Role | Company Consultant and Advisor to the Board of Directors of the Company | ||||
Term | One year from signing | ||||
Compensation | $400,000, paid in four quarterly installments of $100,000 each | ||||
This Consulting Agreement (this "Agreement") is entered into as of August 6, 2026 (the "Effective Date"), by and between Bausch + Lomb Corporation, (the "Company"), and Thomas W. Ross, Sr. ("Consultant").
1.Engagement
The Company hereby engages Consultant to serve as a company consultant and advisor to the Board of Directors of the Company (the "Board Advisor"), and Consultant accepts such engagement, subject to the terms and conditions of this Agreement.
2.Term
The term of this Agreement shall commence on the Effective Date and continue until the one-year anniversary of the Effective Date, unless earlier terminated pursuant to Section 6 (the "Term").
3.Services
During the Term, Consultant shall provide advisory and consulting services to the Company, the Board, Board committees, and management of the Company as reasonably requested from time to time, including:
•Providing strategic advice regarding Company matters;
•Making himself reasonably available for consultation with the Chair of the Board, Board committees, directors, and senior management;
•Attending Board and committee meetings;
•Having access to Board materials and committee materials as reasonably necessary to perform the Services and subject to the confidentiality obligations set forth in this Agreement;
•Participating in meetings and discussions as reasonably requested by the Company; and
•Providing such other advisory services as may be mutually agreed, it being understood that total time
commitment is expected to be consistent with the Consultant’s prior service as a member of the Board
of Directors of the company.
Consultant shall have no authority to bind the Company and shall not be deemed a director, officer, employee, agent, or representative of the Company.
4.Compensation
(a)The Company shall pay the Consultant total fees of $400,000 during the Term.
(b)The fees shall be paid in four equal quarterly installments of $100,000 each.
(c)Payments shall be made as follows:
•$100,000 on the Effective Date;
•$100,000 on the three-month anniversary of the Effective Date;
•$100,000 on the six-month anniversary of the Effective Date; and
•$100,000 on the nine-month anniversary of the Effective Date.
(d)Consultant shall not be entitled to employee benefits, pension benefits, equity compensation, vacation pay, severance benefits, or other employee compensation programs.
5.Expenses
The Company shall reimburse Consultant for reasonable and documented out-of-pocket expenses incurred in connection with the Services, provided such expenses are approved in advance by the Company and submitted in accordance with the Company's expense reimbursement policies.
6.Termination
Either party may terminate this Agreement upon thirty (30) days' prior written notice.
The Company may terminate this Agreement immediately for Cause, including fraud, willful misconduct, material breach of this Agreement, or violation of applicable law.
Upon termination, Consultant shall be entitled to any earned but unpaid fees through the effective date of termination. If the Company terminates the Agreement without Cause, any unpaid quarterly installment otherwise scheduled to be paid during the remainder of the Term shall become immediately due and payable.
7.Confidentiality
Consultant acknowledges that he may receive confidential, proprietary, attorney-client privileged, Board, Board committee, or commercially sensitive information relating to the Company and its affiliates.
Consultant shall:
•Maintain the confidentiality of such information;
•Use such information solely in connection with the Services; and
•Not disclose such information to any third party except as authorized by the Company or required by law.
These obligations shall survive expiration or termination of this Agreement.
8.Ownership of Work Product
Any analyses, reports, recommendations, memoranda, presentations, materials, or other work product created by Consultant in connection with the Services shall be the sole property of the Company.
Consultant hereby assigns to the Company all right, title, and interest in any such work product.
9.Independent Contractor
Consultant is an independent contractor and is not an employee of the Company. Consultant shall be solely responsible for any taxes arising from compensation paid under this Agreement.
10.Cooperation
During the Term and thereafter, Consultant shall reasonably cooperate with the Company regarding matters arising from his prior service as a director of the Company.
11.Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein, without regard to conflict of law principles.
12.Entire Agreement
This Agreement constitutes the entire agreement between the parties regarding the subject matter hereof and supersedes all prior discussions, negotiations, and understandings relating thereto.
This Agreement may only be amended in a writing signed by both parties.
Signatures
BAUSCH + LOMB CORPORATION CONSULTANT
By: /S/ Brent Saunders /s/ Thomas W. Ross, Sr. Name: Brent Saunders Thomas W. Ross, Sr.
Title: Chairman of the Board and Chief Executive Officer
Date:
Aug 5, 2026
Date:
Aug 5, 2026
PAYMENT SCHEDULE SUMMARY
Consultant: Thomas W. Ross, Sr.
Role: Company Consultant and Advisor to the Board of Directors of the Company
Term: One year from August 6, 2026 through August 6, 2027
Total Compensation: $400,000
Payment Schedule
Payment | Amount | Due Date | ||||||
First Quarterly Payment | $100,000 | August 6, 2026 (Effective Date) | ||||||
Second Quarterly Payment | $100,000 | November 6, 2026 | ||||||
Third Quarterly Payment | $100,000 | February 6, 2027 | ||||||
Fourth Quarterly Payment | $100,000 | May 6, 2027 | ||||||
Payment Terms: The Company shall pay Consultant an aggregate fee of $400,000 for services provided during the Term. The fee shall be paid in four equal quarterly installments of $100,000 each, payable on the Effective Date and on each three-month anniversary thereafter.
Illustrative Example if Signed August 3, 2026
Payment | Amount | Due Date | ||||||
1 | $100,000 | August 3, 2026 | ||||||
2 | $100,000 | November 3, 2026 | ||||||
3 | $100,000 | February 3, 2027 | ||||||
4 | $100,000 | May 3, 2027 | ||||||
Total Compensation: $400,000.
Exhibit 31.1
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER
PURSUANT TO RULE 13a-14(a)
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Thomas J. Appio, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Bausch + Lomb Corporation (the “Company”);
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;
4. The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:
a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c. Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d. Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the Company's most recent fiscal quarter (the Company's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting; and
5. The Company's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s board of directors (or persons performing the equivalent functions):
a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and
b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.
| Date: | October 28, 2026 | ||||||||||
| /s/ THOMAS J. APPIO | |||||||||||
| Thomas J. Appio | |||||||||||
| Interim Chief Executive Officer (Principal Executive Officer) | |||||||||||
Exhibit 31.2
CERTIFICATION OF THE CHIEF FINANCIAL OFFICER
PURSUANT TO RULE 13a-14(a)
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Sam Eldessouky, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Bausch + Lomb Corporation (the “Company”);
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;
4. The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:
a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c. Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d. Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter (the Company's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and
5. The Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s board of directors (or persons performing the equivalent functions):
a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and
b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.
| Date: | October 28, 2026 | ||||||||||
| /s/ SAM ELDESSOUKY | |||||||||||
| Sam Eldessouky | |||||||||||
| Executive Vice President and Chief Financial Officer (Principal Financial Officer) | |||||||||||
Exhibit 32.1
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. § 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Thomas J. Appio, Interim Chief Executive Officer of Bausch + Lomb Corporation (the “Company”), certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
1. The Quarterly Report on Form 10-Q of the Company for the quarter ended September 30, 2026 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| Date: | October 28, 2026 | ||||||||||
| /s/ THOMAS J. APPIO | |||||||||||
| Thomas J. Appio | |||||||||||
| Interim Chief Executive Officer (Principal Executive Officer) | |||||||||||
This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by such Act, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates it by reference.
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the U.S. Securities and Exchange Commission or its staff upon request.
Exhibit 32.2
CERTIFICATION OF THE CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. § 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Sam Eldessouky, Executive Vice President and Chief Financial Officer of Bausch + Lomb Corporation (the “Company”), certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
1. The Quarterly Report on Form 10-Q of the Company for the quarter ended September 30, 2026 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| Date: | October 28, 2026 | ||||||||||
| /s/ SAM ELDESSOUKY | |||||||||||
| Sam Eldessouky | |||||||||||
| Executive Vice President and Chief Financial Officer (Principal Financial Officer) | |||||||||||
This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by such Act, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates it by reference.
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the U.S. Securities and Exchange Commission or its staff upon request.