Knowles Corp 8-K, filed Oct 22, 2026
Knowles Corp (KN)
8-K
2026-10-22
For: 2026-10-22
View Original
Added on
October 23, 2026
About this 8-K
Knowles Corp filed this 8-K on October 22, 2026.
Knowles Corporation reported Q3 2026 revenue of $184 million, up 20% year over year, and full-year 2026 revenue estimated at $689 million. Q4 2026 revenue outlook was $180 to $190 million. AI summary
Items reported
- Item 2.02: Financial results
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 22, 2026
(Exact name of registrant as specified in its charter)
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||
(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code: (630 ) 250-5100
(Former Name or Former Address, if Changed since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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. o
| Item 2.02 Results of Operations and Financial Condition. | |||||
On | |||||
The information furnished with the Current Report on Form 8-K and the related exhibits included in Item 9.01 shall not be deemed to be "filed" for purposes of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such filing. | |||||
| Forward Looking Statements | |||||
This Current Report on Form 8-K contains forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. The words “believe,” “expect,” “anticipate,” “project,” “estimate,” “budget,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “seek,” “should,” “will,” “would,” “objective,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target,” and similar expressions, among others, generally identify forward-looking statements, which speak only as of the date the statements were made. The statements in this Current Report on Form 8-K are based on currently available information and the current expectations, forecasts, and assumptions of Knowles’ management concerning risks and uncertainties that could cause actual outcomes or results to differ materially from those outcomes or results that are projected, anticipated, or implied in these statements, including risks, relevant factors, and uncertainties identified in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, subsequent Reports on Forms 10-Q and 8-K and our other filings we make with the U.S. Securities and Exchange Commission. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. | |||||
| Item 9.01 Financial Statements and Exhibits. | ||||||||
| (d) Exhibits. | ||||||||
| The following exhibits are furnished as part of this report: | ||||||||
| Exhibit Number | Description | |||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
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 hereunto duly authorized.
| KNOWLES CORPORATION | ||||||||
Date: | By: /s/ Robert J. Perna | |||||||
| Robert J. Perna | ||||||||
| Senior Vice President, General Counsel & Secretary | ||||||||
Exhibit 99.1
Financial Contact: Sarah Cook Knowles Investor Relations Email: investorrelations@knowles.com | |||||
Knowles Reports Q3 2026 Financial Results and Provides Outlook for Q4 2026
Q3 Revenues Increased 20% on a Year over Year Basis to $184 million
Q3 Net Cash from Operations was $45 million
2026 Full year revenue estimated at $689 million, up 16% vs 2025
ITASCA, Ill., October 22, 2026 - Knowles Corporation (NYSE: KN), a leading manufacturer of specialty electronic components, including high performance capacitors, radio frequency ("RF") filters, advanced medtech microphones, and balanced armature speakers, today announced results for the quarter ended September 30, 2026.
“Third quarter revenue exceeded the high end of our guidance, while non-GAAP diluted EPS and cash from operations were at the high end of our guided ranges,” said Jeffrey Niew, President and CEO of Knowles.
“Total Company revenue grew 20% year over year in the third quarter, and our book-to-bill ratio in Precision Devices remained above one for the eighth consecutive quarter, reflecting continued order strength,” Mr. Niew continued. “By executing our strategy—leveraging our differentiated technologies, developing custom products through close customer collaboration, and scaling production with our world-class operational capabilities—we delivered strong growth across the four major markets we serve: Medtech, Defense, Industrial, and Electrification. Additionally, at the mid-point of our fourth quarter guided range, full year 2026 revenue is expected to grow 16%. I am pleased with the Company’s performance and excited about the opportunities ahead.”
Mr. Niew stated, “Given the strength of our bookings, the number of new design wins ramping up, and favorable long-term secular trends in our markets, as I look forward to 2027, I expect us to continue exceeding the revenue and adjusted EBITDA growth targets presented at our May 2025 Investor Day to drive long-term shareholder value.”
Financial Highlights
The following table highlights the Company’s financial performance on both a GAAP and supplemental non-GAAP basis for continuing operations* with the exception of Net cash provided by operating activities (in millions, except per share data):
| Q3-26 | Q2-26 | Q3-25 | |||||||||||||||
| Revenues | $184.0 | $166.8 | $152.9 | ||||||||||||||
| Gross profit | $81.3 | $74.6 | $69.9 | ||||||||||||||
| (as a % of revenues) | 44.2% | 44.7% | 45.7% | ||||||||||||||
| Non-GAAP gross profit | $83.3 | $75.7 | $70.7 | ||||||||||||||
| (as a % of revenues) | 45.3% | 45.4% | 46.2% | ||||||||||||||
| Diluted earnings per share** | $0.24 | $0.21 | $0.21 | ||||||||||||||
| Non-GAAP diluted earnings per share | $0.38 | $0.33 | $0.33 | ||||||||||||||
| Net cash provided by operating activities | $44.6 | $28.2 | $29.1 | ||||||||||||||
* Continuing operations excludes the results of the Consumer MEMS Microphones reporting business, which was divested in December 2024.
** Current period results include $0.06 per share in stock-based compensation expense, $0.04 per share in intangibles amortization expense, $0.01 per share in restructuring charges, $0.01 per share in production transfer costs, and $0.02 per share for differences related to the GAAP effective tax rate excluded from non-GAAP results.
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Fourth Quarter 2026 Outlook
The forward looking guidance for the quarter ending December 31, 2026 on a continuing operations basis, with the exception of Net cash provided by operating activities, is as follows:
| GAAP | Adjustments | Non-GAAP | |||||||||
| Revenues from continuing operations | $180 to $190 million | — | $180 to $190 million | ||||||||
| Diluted earnings per share from continuing operations | $0.31 to $0.35 | $0.08 | $0.39 to $0.43 | ||||||||
| Net cash provided by operating activities | $60 to $70 million | — | $60 to $70 million | ||||||||
Q4 2026 GAAP results from continuing operations are expected to include approximately $0.06 per share in stock-based compensation expense, $0.04 per share in intangibles amortization expense, $0.02 per share for differences related to the GAAP effective tax rate, and $0.02 per share for other adjustments, partially offset by $0.06 per share in Syntiant dividend income. These items are excluded from non-GAAP results.
Non-GAAP Financial Measures
In addition to the GAAP results included in this press release, Knowles has presented supplemental non-GAAP gross profit, earnings before interest and income taxes, adjusted earnings before interest and income taxes, earnings before interest, income taxes, depreciation, and amortization, adjusted earnings before interest, income taxes, depreciation, and amortization, non-GAAP diluted earnings per share, free cash flow, as well as other metrics on a non-GAAP basis that exclude certain amounts that are included in the most directly comparable GAAP measure to facilitate evaluation of Knowles’ operating performance. Non-GAAP results are not presented in accordance with GAAP. Non-GAAP information should be considered a supplement to, and not a substitute for, financial statements prepared in accordance with GAAP. In addition, the non-GAAP financial measures included in this press release do not have standard meanings and may vary from similarly titled non-GAAP financial measures used by other companies. Knowles believes that non-GAAP measures are useful as supplements to its GAAP results of operations to evaluate certain aspects of its operations and financial performance, and its management team primarily focuses on non-GAAP items in evaluating Knowles’ performance for business planning purposes. Knowles also believes that these measures assist it with comparing its performance between various reporting periods on a consistent basis, as these measures remove from operating results the impact of items that, in Knowles’ opinion, do not reflect its core operating performance including, for example, stock-based compensation, certain intangibles amortization expense, impairment charges, restructuring, production transfer costs, and other charges which management considers to be outside our core operating results. Knowles believes that its presentation of these non-GAAP financial measures is useful because it provides investors and securities analysts with the same information that Knowles uses internally for purposes of assessing its core operating performance. For a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures, see the reconciliation table accompanying this release.
Webcast and Conference Call Information
Investors can listen to a live or replay webcast of the Company’s quarterly financial conference call at http://investor.knowles.com. The live webcast will begin today at 3:30 p.m. Central time. The webcast replay will be available after 7:00 p.m. Central time today accessible via the Knowles website at http://investor.knowles.com for a limited time.
About Knowles
Knowles is a leading manufacturer of specialty electronic components. We design parts that perform unique, critical functions for innovative technologies. Through extreme reliability, custom engineering, and scalable manufacturing, we enable businesses to succeed in the most demanding applications across medtech, defense, and industrial markets.
Our high-performance capacitors, RF microwave filters, advanced medtech microphones, balanced armature speakers, and miniaturization products enable and enhance the performance of technologies with the power to change, improve, and save lives. Founded in 1946 and headquartered in Itasca, Illinois, Knowles has grown into a global organization with employees spanning 11 countries.
For more information, please visit knowles.com.
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Forward-Looking Statements
This news release contains forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995, such as statements about our future plans, objectives, expectations, financial performance, and continued business operations. The words "believe," "expect," "anticipate," "project," "estimate," "budget," "continue," "could," "intend," "may," "plan," "potential," "predict," "seek," "should," "will," "would," "objective," "forecast," "goal," "guidance," "outlook," "effort," "target," and similar expressions, among others, generally identify forward-looking statements, which speak only as of the date the statements were made. The statements in this presentation are based on currently available information and the current expectations, forecasts, and assumptions of Knowles’ management concerning risks and uncertainties that could cause actual outcomes or results to differ materially from those outcomes or results that are projected, anticipated, or implied in these statements. Other risks and uncertainties include, but are not limited to: fluctuations in our stock's market price; fluctuations in operating results and cash flows; our ability to prevent or identify quality issues in our products or to promptly remedy any such issues that are identified; risks associated with increasing our inventories in advance of anticipated orders by customers; escalating international trade tensions, new or increased tariffs and trade wars among countries; the impact of changes to laws and regulations that affect the Company’s ability to offer products or services to customers in different regions; our ability to achieve reductions in our operating expenses; the ability to qualify our products and facilities with customers; our ability to obtain, enforce, defend or monetize our intellectual property rights; disruption caused by a cybersecurity incident, including a cyber-attack, cyber breach, theft, or other unauthorized access (the risk of which could be exacerbated by geopolitical tensions); increases in the costs of critical raw materials and components; availability of raw materials and components; managing new product ramps and introductions for our customers; our dependence on a limited number of large customers; our ability to maintain and expand our existing relationships with leading OEMs in order to maintain and increase our revenue; increasing competition and new entrants in the market for our products; our ability to develop new or enhanced products or technologies in a timely manner that achieve market acceptance; global economic instability, including due to inflation, rising interest rates, or the impacts of geopolitical uncertainties (including the impact of the conflict with Iran); financial risks, including risks relating to currency fluctuations, credit risks and fluctuations in the market value of the Company; a sustained decline in our stock price and market capitalization may result in the impairment of certain intangible or long-lived assets; market risk associated with fluctuations in commodity prices, particularly for various precious metals used in our manufacturing operation, changes in tax laws, changes in tax rates and exposure to additional tax liabilities; and other risks, relevant factors, and uncertainties identified in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, subsequent Reports on Forms 10-Q and 8-K and our other filings we make with the U.S. Securities and Exchange Commission. Knowles disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
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INVESTOR SUPPLEMENT - THIRD QUARTER 2026
KNOWLES CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS
(in millions, except per share amounts)
(unaudited)
| Quarter Ended | |||||||||||||||||
| September 30, 2026 | June 30, 2026 | September 30, 2025 | |||||||||||||||
| Revenues | $ | 184.0 | $ | 166.8 | $ | 152.9 | |||||||||||
| Cost of goods sold | 102.2 | 92.1 | 82.8 | ||||||||||||||
| Restructuring charges - cost of goods sold | 0.5 | 0.1 | 0.2 | ||||||||||||||
| Gross profit | 81.3 | 74.6 | 69.9 | ||||||||||||||
| Research and development expenses | 11.1 | 10.6 | 10.0 | ||||||||||||||
| Selling and administrative expenses | 39.4 | 39.2 | 34.0 | ||||||||||||||
| Restructuring charges | 0.1 | 0.1 | 0.1 | ||||||||||||||
| Operating expenses | 50.6 | 49.9 | 44.1 | ||||||||||||||
| Operating earnings | 30.7 | 24.7 | 25.8 | ||||||||||||||
| Interest expense, net | 1.6 | 1.7 | 2.3 | ||||||||||||||
| Other expense, net | 1.3 | 0.4 | 1.2 | ||||||||||||||
| Earnings before income taxes and discontinued operations | 27.8 | 22.6 | 22.3 | ||||||||||||||
| Provision for income taxes | 6.6 | 4.2 | 4.3 | ||||||||||||||
| Earnings from continuing operations | 21.2 | 18.4 | 18.0 | ||||||||||||||
| Earnings (loss) from discontinued operations, net | 0.4 | 1.0 | (0.6) | ||||||||||||||
| Net earnings | $ | 21.6 | $ | 19.4 | $ | 17.4 | |||||||||||
| Earnings per share from continuing operations: | |||||||||||||||||
| Basic | $ | 0.25 | $ | 0.21 | $ | 0.21 | |||||||||||
| Diluted | $ | 0.24 | $ | 0.21 | $ | 0.21 | |||||||||||
| Earnings (loss) per share from discontinued operations: | |||||||||||||||||
| Basic | $ | — | $ | 0.02 | $ | (0.01) | |||||||||||
| Diluted | $ | 0.01 | $ | 0.01 | $ | (0.01) | |||||||||||
| Net earnings per share: | |||||||||||||||||
| Basic | $ | 0.25 | $ | 0.23 | $ | 0.20 | |||||||||||
| Diluted | $ | 0.25 | $ | 0.22 | $ | 0.20 | |||||||||||
| Weighted-average common shares outstanding: | |||||||||||||||||
| Basic | 85.3 | 85.7 | 85.8 | ||||||||||||||
| Diluted | 87.7 | 87.9 | 87.3 | ||||||||||||||
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KNOWLES CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS
(in millions, except per share amounts)
(unaudited)
| Nine Months Ended | |||||||||||
| September 30, 2026 | September 30, 2025 | ||||||||||
| Revenues | $ | 503.9 | $ | 431.0 | |||||||
| Cost of goods sold | 280.2 | 242.9 | |||||||||
| Impairment charges | — | 3.6 | |||||||||
| Restructuring charges - cost of goods sold | 0.7 | 0.7 | |||||||||
| Gross profit | 223.0 | 183.8 | |||||||||
| Research and development expenses | 33.4 | 29.7 | |||||||||
| Selling and administrative expenses | 118.0 | 107.1 | |||||||||
| Restructuring charges | 0.3 | 2.5 | |||||||||
| Operating expenses | 151.7 | 139.3 | |||||||||
| Operating earnings | 71.3 | 44.5 | |||||||||
| Interest expense, net | 4.8 | 7.5 | |||||||||
| Other expense, net | 5.1 | 2.6 | |||||||||
| Earnings before income taxes and discontinued operations | 61.4 | 34.4 | |||||||||
| Provision for income taxes | 10.5 | 9.0 | |||||||||
| Earnings from continuing operations | 50.9 | 25.4 | |||||||||
| Loss from discontinued operations, net | (0.2) | (2.2) | |||||||||
| Net earnings | $ | 50.7 | $ | 23.2 | |||||||
| Earnings per share from continuing operations: | |||||||||||
| Basic | $ | 0.60 | $ | 0.29 | |||||||
| Diluted | $ | 0.58 | $ | 0.29 | |||||||
| Loss per share from discontinued operations: | |||||||||||
| Basic | $ | (0.01) | $ | (0.02) | |||||||
| Diluted | $ | — | $ | (0.03) | |||||||
| Net earnings per share: | |||||||||||
| Basic | $ | 0.59 | $ | 0.27 | |||||||
| Diluted | $ | 0.58 | $ | 0.26 | |||||||
| Weighted-average common shares outstanding: | |||||||||||
| Basic | 85.5 | 86.8 | |||||||||
| Diluted | 87.9 | 88.1 | |||||||||
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KNOWLES CORPORATION
RECONCILIATION OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES (1)
(in millions, except per share amounts)
(unaudited)
| Quarter Ended | Nine Months Ended | ||||||||||||||||||||||||||||
| September 30, 2026 | June 30, 2026 | September 30, 2025 | September 30, 2026 | September 30, 2025 | |||||||||||||||||||||||||
| Gross profit | $ | 81.3 | $ | 74.6 | $ | 69.9 | $ | 223.0 | $ | 183.8 | |||||||||||||||||||
| Gross profit as % of revenues | 44.2 | % | 44.7 | % | 45.7 | % | 44.3 | % | 42.6 | % | |||||||||||||||||||
| Stock-based compensation expense | 0.4 | 0.4 | 0.3 | 1.3 | 1.1 | ||||||||||||||||||||||||
| Impairment charges | — | — | — | — | 3.6 | ||||||||||||||||||||||||
| Restructuring charges | 0.5 | 0.1 | 0.2 | 0.7 | 0.7 | ||||||||||||||||||||||||
Production transfer costs (2) | 1.1 | 0.8 | 0.6 | 2.8 | 0.9 | ||||||||||||||||||||||||
Transition services credit (3) | — | (0.2) | (0.3) | (0.5) | (0.7) | ||||||||||||||||||||||||
Other (4) | — | — | — | 1.4 | 0.8 | ||||||||||||||||||||||||
| Non-GAAP gross profit | $ | 83.3 | $ | 75.7 | $ | 70.7 | $ | 228.7 | $ | 190.2 | |||||||||||||||||||
| Non-GAAP gross profit as % of revenues | 45.3 | % | 45.4 | % | 46.2 | % | 45.4 | % | 44.1 | % | |||||||||||||||||||
| Research and development expenses | $ | 11.1 | $ | 10.6 | $ | 10.0 | $ | 33.4 | $ | 29.7 | |||||||||||||||||||
| Stock-based compensation expense | (0.6) | (0.6) | (0.7) | (2.7) | (2.6) | ||||||||||||||||||||||||
| Intangibles amortization expense | (0.6) | (0.6) | (0.6) | (1.8) | (1.8) | ||||||||||||||||||||||||
Transition services credit (3) | — | — | — | — | 0.1 | ||||||||||||||||||||||||
Other (4) | — | — | 0.1 | — | 0.2 | ||||||||||||||||||||||||
| Non-GAAP research and development expenses | $ | 9.9 | $ | 9.4 | $ | 8.8 | $ | 28.9 | $ | 25.6 | |||||||||||||||||||
| Selling and administrative expenses | $ | 39.4 | $ | 39.2 | $ | 34.0 | $ | 118.0 | $ | 107.1 | |||||||||||||||||||
| Stock-based compensation expense | (5.8) | (5.2) | (4.9) | (19.4) | (18.7) | ||||||||||||||||||||||||
| Intangibles amortization expense | (3.4) | (3.4) | (3.4) | (10.2) | (10.3) | ||||||||||||||||||||||||
Production transfer costs (2) | — | — | — | — | (0.1) | ||||||||||||||||||||||||
Acquisition-related costs (5) | — | — | 0.1 | — | (0.6) | ||||||||||||||||||||||||
Transition services credit (3) | — | 0.1 | 0.2 | 0.3 | 0.9 | ||||||||||||||||||||||||
Other (4) | — | — | — | — | 0.2 | ||||||||||||||||||||||||
| Non-GAAP selling and administrative expenses | $ | 30.2 | $ | 30.7 | $ | 26.0 | $ | 88.7 | $ | 78.5 | |||||||||||||||||||
| Operating expenses | $ | 50.6 | $ | 49.9 | $ | 44.1 | $ | 151.7 | $ | 139.3 | |||||||||||||||||||
| Stock-based compensation expense | (6.4) | (5.8) | (5.6) | (22.1) | (21.3) | ||||||||||||||||||||||||
| Intangibles amortization expense | (4.0) | (4.0) | (4.0) | (12.0) | (12.1) | ||||||||||||||||||||||||
| Restructuring charges | (0.1) | (0.1) | (0.1) | (0.3) | (2.5) | ||||||||||||||||||||||||
Production transfer costs (2) | — | — | — | — | (0.1) | ||||||||||||||||||||||||
Acquisition-related costs (5) | — | — | 0.1 | — | (0.6) | ||||||||||||||||||||||||
Transition services credit (3) | — | 0.1 | 0.2 | 0.3 | 1.0 | ||||||||||||||||||||||||
Other (4) | — | — | 0.1 | — | 0.4 | ||||||||||||||||||||||||
| Non-GAAP operating expenses | $ | 40.1 | $ | 40.1 | $ | 34.8 | $ | 117.6 | $ | 104.1 | |||||||||||||||||||
| Net earnings from continuing operations | $ | 21.2 | $ | 18.4 | $ | 18.0 | $ | 50.9 | $ | 25.4 | |||||||||||||||||||
| Interest expense, net | 1.6 | 1.7 | 2.3 | 4.8 | 7.5 | ||||||||||||||||||||||||
| Provision for income taxes | 6.6 | 4.2 | 4.3 | 10.5 | 9.0 | ||||||||||||||||||||||||
| Earnings from continuing operations before interest and income taxes | 29.4 | 24.3 | 24.6 | 66.2 | 41.9 | ||||||||||||||||||||||||
| Earnings from continuing operations before interest and income taxes as % of revenues | 16.0 | % | 14.6 | % | 16.1 | % | 13.1 | % | 9.7 | % | |||||||||||||||||||
| Stock-based compensation expense | 6.8 | 6.2 | 5.9 | 23.4 | 22.4 | ||||||||||||||||||||||||
| Intangibles amortization expense | 4.0 | 4.0 | 4.0 | 12.0 | 12.1 | ||||||||||||||||||||||||
| Impairment charges | — | — | — | — | 3.6 | ||||||||||||||||||||||||
| Restructuring charges | 0.6 | 0.2 | 0.3 | 1.0 | 3.2 | ||||||||||||||||||||||||
Production transfer costs (2) | 1.1 | 0.8 | 0.6 | 2.8 | 1.0 | ||||||||||||||||||||||||
Acquisition-related costs (5) | — | — | (0.1) | — | 0.6 | ||||||||||||||||||||||||
Transition services credit (3) | — | (0.3) | (0.5) | (0.8) | (1.7) | ||||||||||||||||||||||||
Other (4) | 0.5 | 0.9 | (0.3) | 4.0 | 0.8 | ||||||||||||||||||||||||
| Adjusted earnings from continuing operations before interest and income taxes | $ | 42.4 | $ | 36.1 | $ | 34.5 | $ | 108.6 | $ | 83.9 | |||||||||||||||||||
| Adjusted earnings from continuing operations before interest and income taxes as % of revenues | 23.0 | % | 21.6 | % | 22.6 | % | 21.6 | % | 19.5 | % | |||||||||||||||||||
| Net earnings from continuing operations | $ | 21.2 | $ | 18.4 | $ | 18.0 | $ | 50.9 | $ | 25.4 | |||||||||||||||||||
| Interest expense, net | 1.6 | 1.7 | 2.3 | 4.8 | 7.5 | ||||||||||||||||||||||||
| Provision for income taxes | 6.6 | 4.2 | 4.3 | 10.5 | 9.0 | ||||||||||||||||||||||||
| Earnings from continuing operations before interest and income taxes | 29.4 | 24.3 | 24.6 | 66.2 | 41.9 | ||||||||||||||||||||||||
Non-GAAP reconciling adjustments (6) | 13.0 | 11.8 | 9.9 | 42.4 | 42.0 | ||||||||||||||||||||||||
| Depreciation expense | 5.9 | 5.7 | 5.0 | 16.8 | 15.0 | ||||||||||||||||||||||||
| Adjusted earnings from continuing operations before interest, income taxes, depreciation, and amortization ("Adjusted EBITDA") | $ | 48.3 | $ | 41.8 | $ | 39.5 | $ | 125.4 | $ | 98.9 | |||||||||||||||||||
Adjusted EBITDA as a % of revenues | 26.3 | % | 25.1 | % | 25.8 | % | 24.9 | % | 22.9 | % | |||||||||||||||||||
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| Quarter Ended | Nine Months Ended | ||||||||||||||||||||||||||||
| September 30, 2026 | June 30, 2026 | September 30, 2025 | September 30, 2026 | September 30, 2025 | |||||||||||||||||||||||||
| Provision for income taxes | $ | 6.6 | $ | 4.2 | $ | 4.3 | $ | 10.5 | $ | 9.0 | |||||||||||||||||||
Income tax effects of non-GAAP reconciling adjustments (7) | 1.0 | 1.6 | (1.0) | 7.7 | 1.1 | ||||||||||||||||||||||||
| Non-GAAP provision for income taxes | $ | 7.6 | $ | 5.8 | $ | 3.3 | $ | 18.2 | $ | 10.1 | |||||||||||||||||||
| Net earnings from continuing operations | $ | 21.2 | $ | 18.4 | $ | 18.0 | $ | 50.9 | $ | 25.4 | |||||||||||||||||||
Non-GAAP reconciling adjustments (6) | 13.0 | 11.8 | 9.9 | 42.4 | 42.0 | ||||||||||||||||||||||||
Income tax effects of non-GAAP reconciling adjustments (7) | 1.0 | 1.6 | (1.0) | 7.7 | 1.1 | ||||||||||||||||||||||||
| Non-GAAP net earnings | $ | 33.2 | $ | 28.6 | $ | 28.9 | $ | 85.6 | $ | 66.3 | |||||||||||||||||||
| Diluted earnings per share from continuing operations | $ | 0.24 | $ | 0.21 | $ | 0.21 | $ | 0.58 | $ | 0.29 | |||||||||||||||||||
Earnings per share non-GAAP reconciling adjustment (6) (7) | 0.14 | 0.12 | 0.12 | 0.40 | 0.46 | ||||||||||||||||||||||||
| Non-GAAP diluted earnings per share | $ | 0.38 | $ | 0.33 | $ | 0.33 | $ | 0.98 | $ | 0.75 | |||||||||||||||||||
| Diluted average shares outstanding | 87.7 | 87.9 | 87.3 | 87.9 | 88.1 | ||||||||||||||||||||||||
Non-GAAP adjustment (8) | (0.8) | (0.4) | 0.6 | (0.6) | 0.7 | ||||||||||||||||||||||||
Non-GAAP diluted average shares outstanding (8) | 86.9 | 87.5 | 87.9 | 87.3 | 88.8 | ||||||||||||||||||||||||
Notes:
(1) In addition to the GAAP financial measures included herein, Knowles has presented certain non-GAAP financial measures that exclude certain amounts that are included in the most directly comparable GAAP measures. Knowles believes that non-GAAP measures are useful as supplements to its GAAP results of operations to evaluate certain aspects of its operations and financial performance, and its management team primarily focuses on non-GAAP items in evaluating Knowles' performance for business planning purposes. Knowles also believes that these measures assist it with comparing its performance between various reporting periods on a consistent basis, as these measures remove from operating results the impact of items that, in Knowles' opinion, do not reflect its core operating performance. Knowles believes that its presentation of non-GAAP financial measures is useful because it provides investors and securities analysts with the same information that Knowles uses internally for purposes of assessing its core operating performance.
(2) Production transfer costs represent duplicate costs incurred to migrate manufacturing to existing facilities.
(3) Transition services represent amounts charged to Syntiant in connection with post-closing transition and separation costs.
(4) Other expenses include foreign currency exchange rate impacts on restructuring balances. Other expenses in 2026 also include foreign currency exchange rate adjustments related to certain balances retained subsequent to the disposal of CMM; these adjustments were not deemed material for 2025 periods.
(5) These expenses include ongoing costs to facilitate integration of the Cornell Dubilier acquisition by the Precision Devices segment.
(6) The non-GAAP reconciling adjustments include stock-based compensation expense, intangibles amortization expense, impairment charges, restructuring charges, production transfer costs, acquisition-related costs, and other expenses, partially offset by a credit to transition services.
(7) Income tax effects of non-GAAP reconciling adjustments are calculated using the applicable tax rates in the jurisdictions of the underlying adjustments.
(8) The number of shares used in the diluted average shares outstanding calculations on a non-GAAP basis excludes the impact of stock-based compensation expense expected to be incurred in future periods and not yet recognized in the financial statements, which would otherwise be assumed to be used to repurchase shares under the GAAP treasury stock method. Non-GAAP diluted average shares outstanding also excludes the impact of certain equity awards that are not yet earned.
7
KNOWLES CORPORATION
CONSOLIDATED BALANCE SHEETS
(in millions, except share and per share amounts)
(unaudited)
| September 30, 2026 | December 31, 2025 | ||||||||||||||||||||||
| Current assets: | |||||||||||||||||||||||
| Cash and cash equivalents | $ | 46.6 | $ | 54.2 | |||||||||||||||||||
Receivables, net of allowances of $0.4 and $0.0 | 122.5 | 102.8 | |||||||||||||||||||||
| Inventories | 150.3 | 124.6 | |||||||||||||||||||||
| Prepaid and other current assets | 10.7 | 9.8 | |||||||||||||||||||||
| Total current assets | 330.1 | 291.4 | |||||||||||||||||||||
| Property, plant, and equipment, net | 145.9 | 140.2 | |||||||||||||||||||||
| Goodwill | 270.3 | 270.3 | |||||||||||||||||||||
| Intangible assets, net | 129.1 | 141.1 | |||||||||||||||||||||
| Operating lease right-of-use assets | 17.6 | 19.1 | |||||||||||||||||||||
| Investment in affiliate | 83.4 | 83.4 | |||||||||||||||||||||
| Other assets and deferred charges | 98.8 | 105.6 | |||||||||||||||||||||
| Total assets | $ | 1,075.2 | $ | 1,051.1 | |||||||||||||||||||
| Current liabilities: | |||||||||||||||||||||||
| Accounts payable | $ | 44.6 | $ | 42.9 | |||||||||||||||||||
| Accrued compensation and employee benefits | 30.8 | 29.7 | |||||||||||||||||||||
| Operating lease liabilities | 4.4 | 4.1 | |||||||||||||||||||||
| Other accrued expenses | 25.5 | 28.2 | |||||||||||||||||||||
| Federal and other taxes on income | 7.1 | 1.0 | |||||||||||||||||||||
| Total current liabilities | 112.4 | 105.9 | |||||||||||||||||||||
| Long-term debt | 116.0 | 114.0 | |||||||||||||||||||||
| Deferred income taxes | 1.1 | 1.1 | |||||||||||||||||||||
| Long-term operating lease liabilities | 13.9 | 16.1 | |||||||||||||||||||||
| Other liabilities | 33.5 | 38.2 | |||||||||||||||||||||
| Commitments and contingencies | |||||||||||||||||||||||
| Stockholders' equity: | |||||||||||||||||||||||
Preferred stock - $0.01 par value; 10,000,000 shares authorized; none issued | — | — | |||||||||||||||||||||
Common stock - $0.01 par value; 400,000,000 shares authorized; 100,872,803 and 84,720,988 shares issued and outstanding at September 30, 2026, respectively, and 99,651,892 and 84,887,498 shares issued and outstanding at December 31, 2025, respectively | 1.0 | 1.0 | |||||||||||||||||||||
Treasury stock - at cost; 16,151,815 and 14,764,394 shares at September 30, 2026 and December 31, 2025, respectively | (318.4) | (270.7) | |||||||||||||||||||||
| Additional paid-in capital | 1,753.9 | 1,739.6 | |||||||||||||||||||||
| Accumulated deficit | (518.7) | (569.4) | |||||||||||||||||||||
| Accumulated other comprehensive loss | (119.5) | (124.7) | |||||||||||||||||||||
| Total stockholders' equity | 798.3 | 775.8 | |||||||||||||||||||||
| Total liabilities and stockholders' equity | $ | 1,075.2 | $ | 1,051.1 | |||||||||||||||||||
8
KNOWLES CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(unaudited)
| Nine Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Operating Activities | |||||||||||
| Net earnings | $ | 50.7 | $ | 23.2 | |||||||
| Adjustments to reconcile net earnings to cash from operating activities: | |||||||||||
| Depreciation and amortization | 28.8 | 27.1 | |||||||||
| Stock-based compensation | 23.4 | 22.4 | |||||||||
| Deferred income taxes | 7.8 | 4.3 | |||||||||
| Non-cash interest expense and amortization of debt issuance costs | 0.4 | 4.2 | |||||||||
| Impairment charges on fixed assets | — | 3.6 | |||||||||
| (Gain) loss on sale of business | (0.8) | 1.6 | |||||||||
| Loss on sale of fixed assets | 0.1 | 0.1 | |||||||||
| Other, net | 6.9 | 5.2 | |||||||||
| Changes in assets and liabilities (excluding effects of foreign exchange): | |||||||||||
| Receivables, net | (20.0) | (3.8) | |||||||||
| Inventories | (26.5) | (4.8) | |||||||||
| Prepaid and other current assets | (1.8) | (1.5) | |||||||||
| Accounts payable | 2.3 | (20.8) | |||||||||
| Accrued compensation and employee benefits | 1.1 | (3.4) | |||||||||
| Other accrued expenses | (7.0) | (7.8) | |||||||||
| Accrued taxes | 5.6 | 3.2 | |||||||||
| Other non-current assets and non-current liabilities | 1.1 | 14.0 | |||||||||
| Net cash provided by operating activities | 72.1 | 66.8 | |||||||||
| Investing Activities | |||||||||||
| Capital expenditures | (24.6) | (16.8) | |||||||||
| Purchase of investments | — | (1.6) | |||||||||
| Proceeds from the sale of investments | — | 1.6 | |||||||||
| Proceeds from seller loan repayment | — | 0.5 | |||||||||
| Net cash used in investing activities | (24.6) | (16.3) | |||||||||
| Financing Activities | |||||||||||
| Borrowings under revolving credit facility | 105.0 | — | |||||||||
| Proceeds from exercise of stock options | 5.8 | 3.9 | |||||||||
| Payments under revolving credit facility | (103.0) | (30.0) | |||||||||
| Repurchase of common stock | (47.5) | (55.0) | |||||||||
| Tax on restricted stock and performance share unit vesting and stock option exercises | (14.9) | (7.1) | |||||||||
| Payments of finance lease obligations | (0.3) | (0.4) | |||||||||
| Net cash used in financing activities | (54.9) | (88.6) | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | (0.2) | 0.5 | |||||||||
| Net decrease in cash and cash equivalents | (7.6) | (37.6) | |||||||||
| Cash and cash equivalents at beginning of period | 54.2 | 130.1 | |||||||||
| Cash and cash equivalents at end of period | $ | 46.6 | $ | 92.5 | |||||||
9
KNOWLES CORPORATION
RECONCILIATION OF GAAP CASH FLOW MEASURES TO NON-GAAP CASH FLOW MEASURES (1)
(in millions, except per share amounts)
(unaudited)
| Quarter Ended | Nine Months Ended | ||||||||||||||||||||||||||||
| September 30, 2026 | June 30, 2026 | September 30, 2025 | September 30, 2026 | September 30, 2025 | |||||||||||||||||||||||||
| Net cash provided by (used in) by operating activities | $ | 44.6 | $ | 28.2 | $ | 29.1 | $ | 72.1 | $ | 66.8 | |||||||||||||||||||
| Amounts utilized by discontinued operations | 5.3 | 1.2 | 1.9 | 14.9 | 31.2 | ||||||||||||||||||||||||
| Non-GAAP net cash attributable to continuing operations | 49.9 | 29.4 | 31.0 | 87.0 | 98.0 | ||||||||||||||||||||||||
| Capital expenditures | (7.3) | (6.5) | (7.7) | (24.6) | (16.8) | ||||||||||||||||||||||||
| Amounts attributable to discontinued operations | — | — | — | — | — | ||||||||||||||||||||||||
| Non-GAAP capital expenditures attributable to continuing operations | (7.3) | (6.5) | (7.7) | (24.6) | (16.8) | ||||||||||||||||||||||||
| Non-GAAP net cash attributable to continuing operations | 49.9 | 29.4 | 31.0 | 87.0 | 98.0 | ||||||||||||||||||||||||
| Non-GAAP capital expenditures attributable to continuing operations | (7.3) | (6.5) | (7.7) | (24.6) | (16.8) | ||||||||||||||||||||||||
| Adjusted free cash flow | $ | 42.6 | $ | 22.9 | $ | 23.3 | $ | 62.4 | $ | 81.2 | |||||||||||||||||||
| Adjusted free cash flow as a % of revenues | 23.2 | % | 13.7 | % | 15.2 | % | 12.4 | % | 18.8 | % | |||||||||||||||||||
(1) In addition to measuring cash flow generation based on the operating, investing, and financing classifications included in the Consolidated Statement of Cash Flows, Knowles also measures adjusted free cash flow and adjusted free cash flow as a percentage of revenues. Adjusted free cash flow is defined as non-GAAP net cash attributable to continuing operations less non-GAAP capital expenditures attributable to continuing operations. Non-GAAP net cash attributable to continuing operations is defined as net cash provided by operating activities less amounts generated or utilized by discontinued operations. Non-GAAP capital expenditures attributable to continuing operations is defined as capital expenditures less amounts attributable to discontinued operations. Knowles believes these measures are helpful in measuring its cash generated from its continuing operations that is available to repay debt, fund acquisitions, and repurchase Knowles common stock. Adjusted free cash flow and adjusted free cash flow as a percentage of revenues are not presented in accordance with GAAP and may not be comparable to similarly titled measures used by other companies in our industry. As such, adjusted free cash flow and adjusted free cash flow as a percentage of revenues should not be considered in isolation from, or as an alternative to, any other liquidity measures determined in accordance with GAAP.
10
1 0 . 2 2 . 2 6 Earnings Release Supplemental Information 3rd Quarter 2026
2 Safe Harbor Forward Looking Statements A number of statements in our presentations, the accompanying slides, and the responses to questions on our conference call discussing our quarterly results may constitute forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995, such as statements about our future plans, objectives, expectations, financial performance, and continued business operations. The words "believe," "expect," "anticipate," "project," "estimate," "budget," "continue," "could," "intend," "may," "plan," "potential," "predict," "seek," "should," "will," "would," "objective," "forecast," "goal," "guidance," "outlook," "effort," "target," and similar expressions, among others, generally identify forward-looking statements, which speak only as of the date the statements were made. These statements are based on currently available information and the current expectations, forecasts, and assumptions of Knowles’ management concerning risks and uncertainties that could cause actual outcomes or results to differ materially from those outcomes or results that are projected, anticipated, or implied in these statements. Other risks and uncertainties include, but are not limited to: fluctuations in our stock's market price; fluctuations in operating results and cash flows; our ability to prevent or identify quality issues in our products or to promptly remedy any such issues that are identified; risks associated with increasing our inventories in advance of anticipated orders by customers; escalating international trade tensions, new or increased tariffs and trade wars among countries; the impact of changes to laws and regulations that affect the Company’s ability to offer products or services to customers in different regions; our ability to achieve reductions in our operating expenses; the ability to qualify our products and facilities with customers; our ability to obtain, enforce, defend or monetize our intellectual property rights; disruption caused by a cybersecurity incident, including a cyber-attack, cyber breach, theft, or other unauthorized access (the risk of which could be exacerbated by geopolitical tensions); increases in the costs of critical raw materials and components; availability of raw materials and components; managing new product ramps and introductions for our customers; our dependence on a limited number of large customers; our ability to maintain and expand our existing relationships with leading OEMs in order to maintain and increase our revenue; increasing competition and new entrants in the market for our products; our ability to develop new or enhanced products or technologies in a timely manner that achieve market acceptance; global economic instability, including due to inflation, rising interest rates, or the impacts of geopolitical uncertainties (including the impact of the conflict with Iran); financial risks, including risks relating to currency fluctuations, credit risks, and fluctuations in the market value of the Company; a sustained decline in our stock price and market capitalization may result in the impairment of certain intangible or long-lived assets; market risk associated with fluctuations in commodity prices, particularly for various precious metals used in our manufacturing operation; changes in tax laws, changes in tax rates, and exposure to additional tax liabilities; and other risks, relevant factors, and uncertainties identified in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, subsequent Reports on Forms 10-Q and 8-K and our other filings we make with the U.S. Securities and Exchange Commission. Knowles disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Non-GAAP Disclaimer In addition to the GAAP results included in our presentations, the accompanying slides, and our responses to questions, Knowles has presented supplemental, non-GAAP gross profit, adjusted earnings before interest and income taxes, adjusted earnings before interest and income taxes margin, adjusted earnings before interest, taxes, depreciation, and amortization; adjusted earnings before interest, taxes, depreciation, and amortization margin; non-GAAP gross profit margin, non-GAAP diluted earnings per share, non-GAAP operating expense; free cash flow; and free cash flow margin to facilitate evaluation of Knowles’ operating performance. These non-GAAP financial measures exclude certain amounts that are included in the most directly comparable GAAP measure. In addition, these non-GAAP financial measures do not have standard meanings and may vary from similarly titled non-GAAP financial measures used by other companies. Knowles uses non-GAAP measures as supplements to its GAAP results of operations in evaluating certain aspects of its business, and its executive management team focuses on non-GAAP items as key measures of Knowles’ performance for business planning purposes. These measures assist Knowles in comparing its performance between various reporting periods on a consistent basis, as these measures remove from operating results the impact of items that, in Knowles’ opinion, do not reflect its core operating performance. Knowles believes that its presentation of these non-GAAP financial measures is useful because it provides investors and securities analysts with the same information that Knowles uses internally for purposes of assessing its core operating performance. For a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures, see the reconciliation tables in the Appendix. In addition to the foregoing non-GAAP measures, Knowles uses the operational measure book-to-bill ratio to monitor the performance of the business. Book-to-bill represents the ratio of total bookings in a period to total revenue recognized in that same period. Although the book-to-bill ratio reflects received purchase orders, changes such as cancellations, extensions, or amendments may occur which could result in a reduction in orders.
3* For this non-GAAP financial measure, see the Appendix for GAAP to non-GAAP reconciliation Revenue ($M) Revenue growth was driven by strong product demand across in the four major markets we serve: Medtech, Defense, Industrial, and Electrification. Non-GAAP Diluted EPS growth was driven by higher volume and lower interest expense. Cash generated by operating activities increased with strong product demand and on higher earnings. Third Quarter Results Non-GAAP Diluted EPS* ($) Net Cash Provided by Operating Activities ($M) 29.1 44.6 3Q 2025 3Q 2026 152.9 184.0 3Q 2025 3Q 2026 0.33 0.38 3Q 2025 3Q 2026 +53.3%+ 20.3% +15.2%
4* For this non-GAAP financial measure, see the Appendix for GAAP to non-GAAP reconciliation Third quarter revenue growth was driven by higher volumes in hearing health shipments. Adjusted EBITDA margin was impacted by inventory reserves and increased R&D and OPEX spend supporting long term growth initiatives. MedTech & Specialty Audio SEGMENT PERFORMANCE Adjusted EBITDA Margin* (%) Revenue ($) 64.7 67.0 3Q 2025 3Q 2026 43.7 41.6 3Q 2025 3Q 2026 +3.6% -210 bps
5* For this non-GAAP financial measure, see the Appendix for GAAP to non-GAAP reconciliation Revenue ($) Precision Devices SEGMENT PERFORMANCE Adjusted EBITDA Margin* (%) Revenue growth in the third quarter was driven by increased demand for our products across the four major markets we serve - Medtech, Defense, Industrial and Electrification. Adjusted EBITDA margin increase was driven by increased production volume and factory capacity utilization as we delivered on strong demand across all markets and products. 88.2 117.0 3Q 2025 3Q 2026 25.7 27.5 3Q 2025 3Q 2026 +32.7% +180 bps
6 Fourth Quarter 2026 Outlook Q4 2026 GAAP Results from continuing operations are expected to include approximately $0.06 per share in stock based compensation expense, $0.04 per share in intangibles amortization expense, $0.02 per share for differences related to the GAAP effective tax rate, and $0.02 per share for other adjustments, partially offset by $0.06 per share in Syntiant dividend income. These items are excluded from non-GAAP results. GAAP Adjustments Non-GAAP Revenues from continuing operations $180 to $190 million $— $180 to $190 million Diluted earnings per share from continuing operations $0.31 to $0.35 $0.08 $0.39 to $0.43 Net cash provided by operating activities $60 to $70 million $— $60 to $70 million
7 Appendix
8 Notes 1. Production transfer costs represent duplicate costs incurred to migrate manufacturing to existing facilities. 2. Transition services represent amounts charged to Syntiant in connection with post- closing transition and separation costs. 3. These expenses include ongoing costs to facilitate integration of the Cornell Dubilier acquisition by the Precision Devices segment. 4. Other expenses for the three months ended September 30, 2026 include foreign currency exchange rate adjustments related to certain balances retained subsequent to the disposal of CMM; these adjustments were not deemed material for 2025. Other expenses for the three months ended September 30, 2025 include foreign currency exchange rate impacts on restructuring balances. Quarter Ended September 30, (continuing operations, in millions, except per share amounts) 2026 2025 Revenues $ 184.0 $ 152.9 Gross profit $ 81.3 $ 69.9 Gross profit margin 44.2 % 45.7 % Stock-based compensation expense 0.4 0.3 Restructuring charges 0.5 0.2 Production transfer costs (1) 1.1 0.6 Transition services credit (2) — (0.3) Non-GAAP gross profit $ 83.3 $ 70.7 Non-GAAP gross profit margin 45.3 % 46.2 % Operating expenses $ 50.6 $ 44.1 Stock-based compensation expense (6.4) (5.6) Intangibles amortization expense (4.0) (4.0) Restructuring charges (0.1) (0.1) Acquisition-related costs (3) — 0.1 Transition services credit (2) — 0.2 Other (4) — 0.1 Non-GAAP operating expenses $ 40.1 $ 34.8 Non-GAAP operating expenses margin 21.8 % 22.8 % Net earnings $ 21.2 $ 18.0 Interest expense, net 1.6 2.3 Provision for income taxes 6.6 4.3 Earnings before interest and income taxes 29.4 24.6 Earnings before interest and income taxes margin 16.0 % 16.1 % Stock-based compensation expense 6.8 5.9 Intangibles amortization expense 4.0 4.0 Restructuring charges 0.6 0.3 Production transfer costs (1) 1.1 0.6 Acquisition-related costs (3) — (0.1) Transition services credit (2) — (0.5) Other (4) 0.5 (0.3) Adjusted earnings before interest and income taxes $ 42.4 $ 34.5 Adjusted earnings before interest and income taxes margin 23.0 % 22.6 % R EC O N C ILIA TIO N O F G A A P FIN A N C IA L M EA S U R ES TO N O N -G A A P FIN A N C IA L M EA S U R ES
9 Notes 5. The non-GAAP reconciling adjustments include stock-based compensation expense, intangibles amortization expense, restructuring charges, production transfer costs, acquisition-related costs, and other expenses, partially offset by a credit to transition services. 6. Income tax effects of non-GAAP reconciling adjustments are calculated using the applicable tax rates in the jurisdictions of the underlying adjustments. 7. The number of shares used in the diluted average shares outstanding calculations on a non-GAAP basis excludes the impact of stock-based compensation expense expected to be incurred in future periods and not yet recognized in the financial statements, which would otherwise be assumed to be used to repurchase shares under the GAAP treasury stock method. Non-GAAP diluted average shares outstanding also excludes the impact of certain equity awards that are not yet earned. Quarter Ended September 30, (continuing operations, in millions, except per share amounts) 2026 2025 Net earnings $ 21.2 $ 18.0 Interest expense, net 1.6 2.3 Provision for income taxes 6.6 4.3 Earnings before interest and income taxes $ 29.4 $ 24.6 Non-GAAP reconciling adjustments (5) 13.0 9.9 Depreciation expense 5.9 5.0 Adjusted earnings before interest, income taxes, depreciation, and amortization ("Adjusted EBITDA") $ 48.3 $ 39.5 Adjusted EBITDA margin 26.3 % 25.8 % Net earnings $ 21.2 $ 18.0 Non-GAAP reconciling adjustments (5) 13.0 9.9 Income tax effects of non-GAAP reconciling adjustments (6) 1.0 (1.0) Non-GAAP net earnings $ 33.2 $ 28.9 Diluted earnings per share $ 0.24 $ 0.21 Earnings per share non-GAAP reconciling adjustment (5) (6) 0.14 0.12 Non-GAAP diluted earnings per share $ 0.38 $ 0.33 Diluted average shares outstanding 87.7 87.3 Non-GAAP adjustment (7) (0.8) 0.6 Non-GAAP diluted average shares outstanding (7) 86.9 87.9 R EC O N C ILIA TIO N O F G A A P FIN A N C IA L M EA S U R ES TO N O N -G A A P FIN A N C IA L M EA S U R ES
10 PRECISION DEVICES MEDTECH & SPECIALTY AUDIO Quarter Ended Quarter Ended September 30, June 30, March 31, December 31, September 30, September 30, June 30, March 31, December 31, September 30, (continuing operations, in millions) 2026 2026 2026 2025 2025 2026 2026 2026 2025 2025 Revenues $ 117.0 $ 98.3 $ 85.1 $ 89.7 $ 88.2 $ 67.0 $ 68.5 $ 68.0 $ 72.5 $ 64.7 Gross profit $ 47.2 $ 38.2 $ 31.9 $ 35.0 $ 35.7 $ 34.3 $ 36.3 $ 36.2 $ 37.4 $ 34.1 Gross profit margin 40.3 % 38.9 % 37.5 % 39.0 % 40.5 % 51.2 % 53.0 % 53.2 % 51.6 % 52.7 % Stock-based compensation expense 0.2 0.3 0.3 0.2 0.1 0.2 0.1 0.2 0.2 0.2 Restructuring charges 0.2 0.1 0.3 0.1 0.2 0.3 — — — — Production transfer costs 1.1 0.8 0.9 0.7 0.6 — — — — — Non-GAAP gross profit $ 48.7 $ 39.4 $ 33.4 $ 36.0 $ 36.6 $ 34.8 $ 36.4 $ 36.4 $ 37.6 $ 34.3 Non-GAAP gross profit margin 41.6 % 40.1 % 39.2 % 40.1 % 41.5 % 51.9 % 53.1 % 53.5 % 51.9 % 53.0 % Research and development expenses $ 5.7 $ 5.3 $ 6.1 $ 5.1 $ 5.1 $ 5.4 $ 5.3 $ 5.6 $ 5.4 $ 5.0 Research and development expenses margin 4.9 % 5.4 % 7.2 % 5.7 % 5.8 % 8.1 % 7.7 % 8.2 % 7.4 % 7.7 % Stock-based compensation expense (0.1) (0.1) (0.9) (0.2) (0.3) (0.5) (0.5) (0.6) (0.5) (0.4) Intangibles amortization expense (0.6) (0.6) (0.6) (0.7) (0.6) — — — — — Non-GAAP research and development expenses $ 5.0 $ 4.6 $ 4.6 $ 4.2 $ 4.2 $ 4.9 $ 4.8 $ 5.0 $ 4.9 $ 4.6 Non-GAAP research and development expenses margin 4.3 % 4.7 % 5.4 % 4.7 % 4.8 % 7.3 % 7.0 % 7.4 % 6.8 % 7.1 % Selling and administrative expenses $ 19.3 $ 18.8 $ 18.1 $ 17.6 $ 16.0 $ 4.8 $ 4.8 $ 4.6 $ 4.5 $ 4.1 Selling and administrative expenses margin 16.5 % 19.1 % 21.3 % 19.6 % 18.1 % 7.2 % 7.0 % 6.8 % 6.2 % 6.3 % Stock-based compensation expense (1.0) (1.0) (1.0) (0.7) (0.7) (0.7) (0.7) (0.9) (0.6) (0.6) Intangibles amortization expense (3.4) (3.4) (3.4) (3.4) (3.4) — — — — — Acquisition-related costs — — — (0.2) 0.1 — — — — — Non-GAAP selling and administrative expenses $ 14.9 $ 14.4 $ 13.7 $ 13.3 $ 12.0 $ 4.1 $ 4.1 $ 3.7 $ 3.9 $ 3.5 Non-GAAP selling and administrative expenses margin 12.7 % 14.6 % 16.1 % 14.8 % 13.6 % 6.1 % 6.0 % 5.4 % 5.4 % 5.4 % Operating expenses $ 25.1 $ 24.2 $ 24.3 $ 23.1 $ 21.2 $ 10.2 $ 10.1 $ 10.2 $ 10.0 $ 9.1 Operating expenses margin 21.5 % 24.6 % 28.6 % 25.8 % 24.0 % 15.2 % 14.7 % 15.0 % 13.8 % 14.1 % Stock-based compensation expense (1.1) (1.1) (1.9) (0.9) (1.0) (1.2) (1.2) (1.5) (1.1) (1.0) Intangibles amortization expense (4.0) (4.0) (4.0) (4.1) (4.0) — — — — — Restructuring charges (0.1) (0.1) (0.1) (0.4) (0.1) — — — (0.1) — Acquisition-related costs — — — (0.2) 0.1 — — — — — Non-GAAP operating expenses $ 19.9 $ 19.0 $ 18.3 $ 17.5 $ 16.2 $ 9.0 $ 8.9 $ 8.7 $ 8.8 $ 8.1 Non-GAAP operating expenses margin 17.0 % 19.3 % 21.5 % 19.5 % 18.4 % 13.4 % 13.0 % 12.8 % 12.1 % 12.5 % H IS T O R IC A L S E G M E N T D A T A
11 H IS T O R IC A L S E G M E N T D A T A PRECISION DEVICES MEDTECH & SPECIALTY AUDIO Quarter Ended Quarter Ended September 30, June 30, March 31, December 31, September 30, September 30, June 30, March 31, December 31, September 30, (continuing operations, in millions) 2026 2026 2026 2025 2025 2026 2026 2026 2025 2025 Revenues $ 117.0 $ 98.3 $ 85.1 $ 89.7 $ 88.2 $ 67.0 $ 68.5 $ 68.0 $ 72.5 $ 64.7 Operating earnings $ 22.1 $ 14.0 $ 7.6 $ 11.9 $ 14.5 $ 24.1 $ 26.2 $ 26.0 $ 27.4 $ 25.0 Other expense (income), net 0.1 0.1 — — 0.2 — (0.1) — — — Earnings before interest and income taxes $ 22.0 $ 13.9 $ 7.6 $ 11.9 $ 14.3 $ 24.1 $ 26.3 $ 26.0 $ 27.4 $ 25.0 Earnings before interest and income taxes margin 18.8 % 14.1 % 8.9 % 13.3 % 16.2 % 36.0 % 38.4 % 38.2 % 37.8 % 38.6 % Stock-based compensation expense 1.3 1.4 2.2 1.1 1.1 1.4 1.3 1.7 1.3 1.2 Intangibles amortization expense 4.0 4.0 4.0 4.1 4.0 — — — — — Restructuring charges 0.3 0.2 0.4 0.5 0.3 0.3 — — 0.1 — Production transfer costs 1.1 0.8 0.9 0.7 0.6 — — — — — Acquisition-related costs — — — 0.2 (0.1) — — — — — Adjusted earnings before interest and income taxes $ 28.7 $ 20.3 $ 15.1 $ 18.5 $ 20.2 $ 25.8 $ 27.6 $ 27.7 $ 28.8 $ 26.2 Adjusted earnings before interest and income taxes margin 24.5 % 20.7 % 17.7 % 20.6 % 22.9 % 38.5 % 40.3 % 40.7 % 39.7 % 40.5 % Operating earnings $ 22.1 $ 14.0 $ 7.6 $ 11.9 $ 14.5 $ 24.1 $ 26.2 $ 26.0 $ 27.4 $ 25.0 Other expense (income), net 0.1 0.1 — — 0.2 — (0.1) — — — Earnings before interest and income taxes $ 22.0 $ 13.9 $ 7.6 $ 11.9 $ 14.3 $ 24.1 $ 26.3 $ 26.0 $ 27.4 $ 25.0 Non-GAAP reconciling adjustments 6.7 6.4 7.5 6.6 5.9 1.7 1.3 1.7 1.4 1.2 Depreciation expense 3.5 3.2 2.6 2.5 2.5 2.1 2.1 2.2 2.1 2.1 Adjusted earnings before interest, income taxes, depreciation, and amortization ("Adjusted EBITDA") $ 32.2 $ 23.5 $ 17.7 $ 21.0 $ 22.7 $ 27.9 $ 29.7 $ 29.9 $ 30.9 $ 28.3 Adjusted EBITDA margin 27.5 % 23.9 % 20.8 % 23.4 % 25.7 % 41.6 % 43.4 % 44.0 % 42.6 % 43.7 %
12 R E C O N C IL IA T IO N O F N E T E A R N IN G S T O A D JU S T E D E B IT D A Quarter Ended September 30, June 30, March 31, December 31, Trailing 12-months(continuing operations, in millions) 2026 2026 2026 2025 Net earnings $ 21.2 $ 18.4 $ 11.3 $ 25.5 $ 76.4 Interest expense, net 1.6 1.7 1.5 1.8 6.6 Provision for (benefit from) income taxes 6.6 4.2 (0.3) 4.1 14.6 Earnings before interest and income taxes 29.4 24.3 12.5 31.4 97.6 Stock-based compensation expense 6.8 6.2 10.4 6.0 29.4 Intangibles amortization expense 4.0 4.0 4.0 4.1 16.1 Restructuring charges 0.6 0.2 0.2 0.6 1.6 Production transfer costs 1.1 0.8 0.9 0.7 3.5 Acquisition-related costs — — — 0.2 0.2 Transition services credit — (0.3) (0.5) (0.3) (1.1) Dividend income — — — (6.2) (6.2) Other 0.5 0.9 2.6 (0.3) 3.7 Non-GAAP reconciling adjustments 13.0 11.8 17.6 4.8 47.2 Depreciation expense 5.9 5.7 5.2 5.1 21.9 Adjusted earnings before interest, income taxes, depreciation, and amortization ("Adjusted EBITDA") $ 48.3 $ 41.8 $ 35.3 $ 41.3 $ 166.7
13 R E C O N C IL IA T IO N O F N E T D E B T (in millions) September 30, 2026 Current maturities of long-term debt $ — Long-term debt 116.0 Total debt 116.0 Less: Cash and cash equivalents (46.6) Net debt $ 69.4 Net debt $ 69.4 Trailing 12 Month Adjusted EBITDA $ 166.7 Net debt leverage ratio 0.4 x
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