APHAmphenol

Net sales were $23,094.7 for the year ended December 31, 2025 compared to $15,222.7 for the year ended December 31, 2024 compared to $12,554.7 for the year ended December 31, 2023, 2024, representing an increase of 21% 52% in both U.S. dollars dollars, 51% in constant currencies and constant currencies, as well as 13% 38% organically (excluding both currency and acquisition impacts), impacts; unless otherwise indicated, organic net sales growth is primarily driven by higher sales volumes), compared to the prior year. The increase in net sales in 2024 2025 was driven by strong robust organic growth in the Communications Solutions segment and moderate strong organic growth in the Harsh Environment Solutions segment and Interconnect and Sensor Systems segment and Harsh Environment Solutions segment, along with contributions from the Company’s acquisition program, all as described below. From an end market standpoint, the increase in net sales was driven by strong robust organic growth in the information technology and data communications (“IT datacom”), mobile devices, datacom”) market, strong organic growth in the defense, industrial, communications networks and commercial aerospace and defense markets and moderate organic growth in the automotive and mobile networks devices markets, along with contributions from the Company’s acquisition program, partially offset by organic declines in the industrial and broadband communications markets. program. Net sales to the IT datacom market increased approximately $1,334.2, $4,593.7, as we experienced strong robust growth across a broad array of applications, in particular the continued acceleration in and strong demand for products used in next-generation artificial intelligence-related AI-related applications, along with growth in servers, networking equipment, servers, cloud storage, storage and consumer electronics. peripherals. Net sales to the communications networks market increased approximately $1,374.3, driven primarily by contributions from acquisitions, in particular the acquisition of Andrew (as defined and discussed below within this Item 7 and in Note 11 of the accompanying Notes to Consolidated Financial Statements herein), along with organic growth in demand from mobile network operators and wireless equipment manufacturers. Net sales to the industrial market increased approximately $452.1, $770.0, primarily driven by contributions from acquisitions, along with growth in mass transit, battery and electric heavy vehicles, alternative energy, instrumentation and medical applications, which were partially offset instrumentation, alternative energy and other industrial equipment. Net sales to the defense market increased approximately $499.2, driven by moderations in factory broad-based strength across virtually all defense applications, particularly related to communications, ground vehicles, space, missiles and building automation, transportation, oil and gas, marine and heavy equipment applications. naval, as well as contributions from acquisitions. Net sales to the commercial aerospace market increased approximately $382.9, $322.2, primarily due to contributions from acquisitions, in particular the CIT acquisition, along with broad-based strength in demand from nearly all commercial aircraft manufacturers across a broad range of platforms. Net sales to the defense market increased approximately $214.0, driven by broad-based strength across nearly all defense applications, particularly space-related, avionics, communications, airframe, and ground vehicle applications, as well as contributions from acquisitions. Net sales to the automotive market increased approximately $168.3, $248.3, reflecting strength in demand from power management, infotainment communications, safety and security systems and antenna and related assemblies, along with contributions from acquisitions, partially offset by moderations in both electric and hybrid drive train platforms. platforms, antenna and related assemblies, and infotainment communications. Net sales to the mobile devices market increased approximately $131.5, $64.3, driven by growth in sales in most mobile device applications, including smartphones, laptops, handsets, wearable devices, laptops and wearable and hearable devices, partially offset by a moderation in tablets. Net sales to the mobile networks market increased approximately $50.2, driven primarily by contributions from acquisitions, along with growth in demand from mobile network operators and wireless equipment manufacturers. Net sales to the broadband communications market decreased approximately $65.2, driven by moderations in demand from broadband service operators.

The third amended and restated credit agreement governs our $3.0 billion unsecured revolving credit facility (the “Revolving Credit Facility”), which also backstops the Company’s U.S. commercial paper program (“U.S. Commercial Paper Program”) and Euro commercial paper program (“Euro Commercial Paper Program”, and together with the U.S. Commercial Paper Program, “Commercial Paper Programs”). The Revolving Credit Facility contains financial and other covenants, such as a limit on the ratio of debt to earnings before interest, taxes, depreciation and amortization, a limit on priority indebtedness and limits on incurrence of liens. The Company also has similar financial and other covenants associated with its three-year unsecured delayed draw term loan credit agreement (the “Three-Year Delayed Draw Term Loan”) and 364-day unsecured delayed draw term loan credit agreement (the “364-Day Delayed Draw Term Loan” and, together with the Three-Year Delayed Draw Term Loan, the “Delayed Draw Term Loans”), each of which was entered into in August 2025. The ability to meet the financial covenants can be affected by events beyond the Company’s control, and the Company cannot provide assurance that it will meet those tests. A breach of any of these covenants could result in a default under the Revolving Credit Facility. Facility or the Delayed Draw Term Loans, as applicable. Upon the occurrence of an event of default under the Revolving Credit Facility, Facility or the Delayed Draw Term Loans, the applicable lenders could terminate all applicable commitments to extend further credit thereunder (if any) and elect to declare amounts outstanding thereunder to be immediately due and payable, which could result in the acceleration of certain of the Company’s other indebtedness and the Company not having sufficient assets to repay indebtedness under the Revolving Credit Facility Facility, the Delayed Draw Term Loans and such other debt instruments. As of December 31, 2024, 2025, the Company had no borrowings outstanding under the Revolving Credit Facility, U.S. the Delayed Draw Term Loans, or the Commercial Paper Program and Euro Commercial Paper Program. Programs. However, the Company borrowed $1,534.1 million under each of the Delayed Draw Term Loans in January 2026 to fund a portion of the consideration for the CommScope acquisition. In addition, the Company borrowed under the U.S. Commercial Paper Program throughout much of 2024, 2025, and the Company may make additional borrowings under any of its debt instruments the Revolving Credit Facility and the Commercial Paper Programs from time to time. time in 2026 and beyond.

Annually, the Company performs its goodwill impairment assessment on its three reporting units. In the third quarter of 2024 2025, as part of its annual evaluations, the Company performed a quantitative goodwill impairment assessment for each reporting unit. As part of the quantitative assessment, the Company estimated the fair value of each of its reporting units using an equal weighting of the market and 2023, income approaches, which the Company believes provide the best indicators of their fair value. The market approach utilizes market prices and other relevant metrics for comparable publicly-traded companies with similar operating and investment characteristics, as well as recent transactions of similar businesses within the industry, while the income approach is based on estimate discounted future cash flows. Significant estimates and assumptions were used in the Company’s goodwill impairment assessment, including both historical and projected revenue and profitability data, the determination and selection of appropriate publicly-traded market comparison companies, and the calculation of comparable earnings-based and other multiples derived from comparable publicly-traded companies and from recent transactions within the industry. As part of its quantitative approach, the Company evaluated whether there were reasonably likely changes to management’s estimates and assumptions that would have a material impact on the results of the goodwill impairment assessment. In the third quarter of 2024, as part of our annual evaluations, the Company utilized the option to first assess qualitative factors to determine whether it was necessary to perform the quantitative goodwill impairment assessment. As part of these assessments, the Company reviews qualitative factors, which include, but are not limited to, economic, market and industry conditions, as well as the financial performance of each reporting unit. In accordance with applicable guidance, an entity is not required to calculate the fair value of a reporting unit if, after assessing these qualitative factors, the Company determines that it is more likely than not that the fair value of each of its reporting units is greater than its respective carrying amount. As of July 1, 2024 2025 and 2023, 2024, the Company determined that it was more likely than not that the fair value of each of its reporting units exceeded its was substantially in excess of their respective carrying amount amounts and, therefore, a quantitative assessment was not required. As a result, no goodwill impairment resulted from the assessments as of July 1, 2024 2025 and 2023. 2024.

Certain operations of the Company are subject to environmental laws and regulations that govern the discharge of pollutants into the air and water, as well as the handling and disposal of solid and hazardous wastes. The Company believes that its operations are currently in substantial compliance with applicable environmental laws and regulations and that the costs of continuing compliance will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows.