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Embecta Corp. (EMBC)

CIK: 0001872789. SIC: 3841 Surgical & Medical Instruments & Apparatus. Latest 10-K as of: 2025-11-25.

SIC breadcrumb: Manufacturing > SIC Major Group 38 > SIC 3841 Surgical & Medical Instruments & Apparatus

SEC company page: https://www.sec.gov/edgar/browse/?CIK=1872789. Latest filing source: 0001872789-25-000036.

Selected Fundamentals

MetricValueUnitFYFiled
Revenue1,080,400,000USD20252025-11-25
Net income95,400,000USD20252025-11-25
Assets1,090,900,000USD20252025-11-25

Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2025-11-25. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001872789.json. Derived margins are computed from the extracted annual SEC facts.

Flow metrics use full-year FY periods from 10-K/10-K/A filings; balance-sheet metrics use FY-end instants. Missing metrics are omitted rather than fabricated.

Metric2019202020212022202320242025
Revenue1,085,500,0001,165,300,0001,129,500,0001,120,800,0001,123,100,0001,080,400,000
Net income427,600,000414,800,000223,600,00070,400,00078,300,00095,400,000
Operating income486,500,000492,000,000309,600,000221,500,000166,800,000242,100,000
Gross profit762,600,000800,400,000774,900,000749,900,000735,200,000676,800,000
Diluted EPS7.507.283.891.221.341.62
Assets788,000,0001,086,400,0001,214,400,0001,285,300,0001,090,900,000
Stockholders' equity577,100,000572,200,000594,300,000-891,400,000-821,700,000-738,300,000-650,600,000
Cash and cash equivalents0.00330,900,000326,300,000267,500,000225,500,000
Net margin39.39%35.60%19.80%6.28%6.97%8.83%
Operating margin44.82%42.22%27.41%19.76%14.85%22.41%

Financial Charts

Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-05. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001872789.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

QuarterEnd DateRevenueNet IncomeDiluted EPSMethod
2022-Q32022-06-301.07reported discrete quarter
2023-Q12022-12-310.61reported discrete quarter
2023-Q22023-03-310.24reported discrete quarter
2023-Q32023-06-30286,100,00015,200,0000.26reported discrete quarter
2023-Q42023-09-30281,900,0006,000,000derived Q4 = FY annual - nine-month YTD
2024-Q12023-12-31277,300,00020,100,0000.35reported discrete quarter
2024-Q22024-03-31287,200,00028,900,0000.50reported discrete quarter
2024-Q32024-06-30272,500,00014,700,0000.25reported discrete quarter
2024-Q42024-09-30286,100,00014,600,000derived Q4 = FY annual - nine-month YTD
2025-Q12024-12-31261,900,0000.000.00reported discrete quarter
2025-Q22025-03-31259,000,00023,500,0000.40reported discrete quarter
2025-Q32025-06-30295,500,00045,500,0000.78reported discrete quarter
2025-Q42025-09-30264,000,00026,400,000derived Q4 = FY annual - nine-month YTD
2026-Q12025-12-31261,200,00044,100,0000.74reported discrete quarter
2026-Q22026-03-31221,800,000-4,100,000-0.07reported discrete quarter

Quarterly Charts

Macro Cross-References

Latest quarter (10-Q)

Latest 10-Q source: 0001872789-26-000017.

Extracted between Part I Item 2 and the next Item 3/4 or Part II heading after HTML sanitization. Confidence: high. Filing date: 2026-05-05. Report date: 2026-03-31.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Certain Factors Affecting Forward-Looking Statements

The following discussion and analysis should be read in conjunction with the Condensed Consolidated Financial Statements and accompanying notes contained elsewhere in this Quarterly Report on Form 10-Q. This discussion contains a number of forward-looking statements, all of which are based on our current expectations and could be affected by the uncertainties and other factors described throughout this discussion and analysis, particularly in the section “Cautionary Statement Concerning Forward-Looking Statements.”

Company Overview

We are a leading global medical device company focused on providing solutions to improve the health and well-being of people living with diabetes. In the over 100-year history of our business, we believe that our products have become some of the most widely recognized and respected brands in diabetes management in the world. We estimate that our products are used by approximately 30 million people in over 100 countries for insulin administration and to aid with the daily management of diabetes. Our business traces its origins to 1924, when BD developed the first dedicated insulin syringe. Since then, we have built a world-class organization with a unique manufacturing, supply chain and commercial footprint.

We have a broad portfolio of marketed products, including a variety of pen needles, syringes and safety injection devices. Our pen needles are sterile, single-use, medical devices, designed to be used in conjunction with pen injectors that inject insulin or other diabetes medications. We also sell safety pen needles, which have shields on both ends of the cannula that automatically deploy after the injection to help prevent needlestick exposure and injury during injection and disposal. Our traditional and safety pen needles are compatible and frequently used with widely available pen injectors in the market today. In addition to pen needles, we sell sterile, single-use insulin syringes, which are used to inject insulin drawn from insulin vials. We also sell safety insulin syringes, which have a sliding safety shield that can be activated with one-hand after the injection to help prevent needlestick exposure and injury during injection and disposal.

We primarily sell our products to wholesalers and distributors that sell to retail and institutional channels who in turn sell to patients or use the products to deliver insulin injections to patients.

Key Trends Affecting Our Results of Operations

Competition. The regions in which we conduct our business and the medical devices industry in general are highly competitive. We face significant competition from a wide range of companies in a highly regulated industry. These include large companies with multiple product lines, some of which may have greater financial and marketing resources than us, as well as smaller more specialized companies. Non-traditional entrants, such as technology companies, are also entering into the diabetes care industry and its adjacent markets, some of which may have greater financial and marketing resources than us.

Pricing and Volume Pressures. We face significant pricing pressures from competitors in the pen needle and insulin syringe categories who not only can provide competitive products at lower costs, but also provide payors and customers with more choices for formulary partners in these categories. As a result, select distributors and retailers, especially in the United States, can exercise substantial pricing pressure power in view of the competitive nature of our business which can significantly affect sales volume and market share. In addition, the increased scrutiny by regulators on healthcare spending, which accelerated in light of the COVID-19 pandemic, along with a shift towards volume-based procurement and group purchasing organizations, which generally values lower cost over product features, benefits and quality, have placed significant pressure on Embecta to lower price in both developed and emerging markets. These trends may reduce our operating margins, which are only partially offset by our ability to differentiate our products and sell at higher prices.

Commoditization of Injection Devices. Given the growing demand for medical devices to assist in the treatment of diabetes and difficulties around access to diabetes care due to complex and costly insurance plans, patient care is increasingly focused on providing more affordable products, which has led to the commoditization of more traditional injection delivery devices, such as insulin syringes and pen needles. Existing and new local and regional low-cost providers, in combination with a shift from insulin vials to insulin pens, have made the pen needle category highly competitive.

Global Trade. The current global economic environment has been recently influenced by rapidly changing tariff policies instituted by the United States government and foreign governments. As a global company that both imports raw materials and products into the U.S. and distributes raw materials and products originating from the U.S. to global manufacturing sites and markets, these tariffs may have a financial impact on our cost of goods, our profit margins, our business generally and our global distribution strategy. These tariffs may cause foreign governments and private purchasers to consider transitioning away from products originating from certain countries (including the U.S.) in favor of buying “local” products resulting in the additional possibility that local manufacturers, brands and other competitors may engage in aggressive

Dollar amounts are in millions except per share amounts or as otherwise specified.

22

Table of Contents

competitive pricing to take advantage of the uncertain global trade environment and transition customers away from global manufacturers, all of which may impact the Company’s business and operations.

Changes in Clinical Practice. Introduction of new drugs and increased penetration of oral and once-weekly anti-diabetic drugs (e.g., SGLT-2s, once-weekly insulin, GLP-1s and GLP-1 combination products) have delayed initiation of insulin therapy and contributed to less demand for our products. New drug therapies, including weekly insulin, are targeted to challenge the current diabetes treatment paradigm, including the frequency insulin is dosed (weekly vs. daily injections) and amount of insulin used. Additionally, insulin therapy in developed markets continues to transition to infusion pumps.

Decentralization of Chronic Care. Many countries are facing an aging population and a rapidly growing number of people living with diabetes. While healthcare investments in certain regions continue to grow, there is an increased burden on physicians and longer wait times for patients. Healthcare delivery for non-emergency diabetes care is expected to continue shifting outside of hospitals to primary care providers, which could have a material impact on our results of operations.

Political and Economic Instability in Emerging Markets. We operate in a number of emerging markets, many of which are subject from time to time to significant political and economic disruptions. However, the number of countries we provide products to and our proactive channel management strategies help us manage this variability.

Recent Developments

We continue to face increases in the cost and disrupted availability of raw materials, components, and other inputs necessary to manufacture and distribute our products due to constraints and inflation within the global supply chain, as well as increases in the cost and time to distribute our products. To date we have been able to successfully mitigate this disruption and provide uninterrupted supply to our customers by increasing our inventory levels and taking other measures. Given our global business, we expect tariffs announced over the past year will result in additional cost for us and our suppliers, and there is the potential that such tariffs may influence future decisions by foreign governments and private purchasers to source non-U.S., “locally” manufactured products instead of products originating from certain countries (including the U.S.) and that local manufacturers, brands and other competitors may engage in aggressive competitive pricing or other strategies to take advantage of the uncertain global trade environment and transition customers away from global manufacturers. We will continue to monitor the evolving tariff environment and we will focus on optimizing operations and leveraging existing strategies to reduce the impact from tariffs.

We continue to monitor global conflicts, including activity in the Middle East and Houthi attacks on commercial shipping vessels and other naval vessels, and the associated sanctions and other restrictions. As of May 5, 2026, there is no material impact to our business operations and financial performance as a result of the aforementioned conflicts. However, the full impact of the conflicts on our business operations and financial performance remains uncertain and will depend on future developments, including the severity and duration of the conflicts and their impact on regional and global economic conditions. We will continue to monitor these conflicts and assess the related restrictions and other effects on our business.

In addition, our revenues and results of operations have been affected by various fluctuations in macroeconomic conditions and regulatory and policy changes, both on a global level and in particular markets, which include inflation and slowing economic growth and contractions, a changing interest rate environment, supply chain interruptions, tariff policy changes, volatility in capital markets and the availability of credit, tax rates and the rate of exchange between the United States dollar and foreign currencies. The nature and extent of the impact of these factors among others varies by region and remains uncertain and unpredictable and may affect our business.

On March 19, 2026, we entered into a definitive agreement to acquire Owen Mumford Holdings Limited (the "Purchase Agreement") for approximately £150 million. Owen Mumford Holdings Limited (“OM”) is a privately held, UK-based innovator and manufacturer of medical devices and drug-delivery technologies. Under the terms of the Purchase Agreement, we will acquire OM for an upfront cash payment of £100 million at closing (subject to customary adjustments, including for closing net cash), and will pay up to an additional £50 million upon the achievement of certain commercial milestones related to sales of the Aidaptus® next-generation auto-injector platform through the period ending June 30, 2029. The transaction is expected to close within the third fiscal quarter of 2026.

In May 2026, the Company announced that the Board approved a three-year $100.0 million stock repurchase authorization (the “Repurchase Program”) of common stock in accordance with applicable securities laws. The Repurchase Program does not obligate the Company to acquire any particular amount of common stock and may be suspended or terminated at any time at the Company’s discretion.

In May 2026, the Board of Directors approved a reduction in the quarterly cash dividend from $0.15 to $0.01 per share of common stock. The dividend is payable on June 15, 2026 to stockholders of record as of May 28, 2026.

In May 2026, we initiated a review of our cost structure and organizational footprint.

Dollar amounts are in millions except per share amounts or as otherwise specified.

23

Table of Contents

Results of Operations

Our unaudited Condensed Consolidated Statements of (Loss) Income are as follows:

Three months ended March 31,

Six months ended March 31,

2026

2025

%

2026

2025

%

Revenues

$

221.8 

$

259.0 

(1

[Excerpt truncated for page length; source filing is linked above.]

Latest 10-K MD&A

Extracted between Item 7 and the next Item 7A/8 heading after HTML sanitization. Confidence: high. Filing date: 2025-11-25. Report date: 2025-09-30.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with the Consolidated Financial Statements and accompanying notes presented in Item 8 of this Annual Report on Form 10-K. Within the tables presented throughout this discussion, certain columns may not add due to the use of rounded numbers for disclosure purposes. Percentages and earnings per share amounts presented are calculated from the underlying amounts. Dollar amounts are in millions except per share amounts or as otherwise specified. References to years throughout this discussion relate to our fiscal years, which end on September 30.

Company Overview

We are a leading global medical device company focused on providing solutions to improve the health and well-being of people living with diabetes. In the 100-year history of our business, we believe that our products have become some of the most widely recognized and respected brands in diabetes management in the world. We estimate that our products are used by approximately 30 million people in over 100 countries for insulin administration and to aid with the daily management of diabetes. Our business traces its origins to 1924, when BD developed the first dedicated insulin syringe. Since then, we have built a world-class organization with a unique manufacturing, supply chain and commercial footprint.

34

We have a broad portfolio of marketed products, including a variety of pen needles, syringes and safety injection devices. Our pen needles are sterile, single-use, medical devices, designed to be used in conjunction with pen injectors that inject insulin or other diabetes medications. We also sell safety pen needles, which have shields on both ends of the cannula that automatically deploy after the injection to help prevent needlestick exposure and injury during injection and disposal. Our traditional and safety pen needles are compatible and frequently used with widely available pen injectors in the market today. In addition to pen needles, we sell sterile, single-use insulin syringes, which are used to inject insulin drawn from insulin vials. We also sell safety insulin syringes, which have a sliding safety shield that can be activated with one-hand after the injection to help prevent needlestick exposure and injury during injection and disposal.

We primarily sell our products to wholesalers and distributors that sell to retail and institutional channels who in turn sell to patients or use the products to deliver insulin injections to patients.

Key Trends Affecting Our Results of Operations

Competition. The regions in which we conduct our business and the medical devices industry in general are highly competitive. We face significant competition from a wide range of companies in a highly regulated industry. These include large companies with multiple product lines, some of which may have greater financial and marketing resources than us, as well as smaller more specialized companies. Non-traditional entrants, such as technology companies, are also entering into the diabetes care industry and its adjacent markets, some of which may have greater financial and marketing resources than us.

Pricing Pressures. We face significant pricing pressures from competitors in the pen needle and insulin syringe categories who not only can provide competitive products at lower costs, but also provide payors and customers with more choices for formulary partners in these categories. In addition, the increased scrutiny by regulators on healthcare spending, which accelerated in light of the COVID-19 pandemic, along with a shift towards volume-based procurement and group purchasing organizations, which generally values lower cost over product features, benefits and quality, have placed significant pressure on Embecta to lower price in both developed and emerging markets. These trends may reduce our operating margins, which are only partially offset by our ability to differentiate our products and sell at higher prices.

Commoditization of Injection Devices. Given the growing demand for medical devices to assist in the treatment of diabetes and difficulties around access to diabetes care due to complex and costly insurance plans, patient care is increasingly focused on providing more affordable products, which has led to the commoditization of more traditional injection delivery devices, such as insulin syringes and pen needles. Existing and new local and regional low-cost providers, in combination with a shift from insulin vials to insulin pens, have made the pen needle category highly competitive.

Global Trade. The current global economic environment has been recently influenced by rapidly changing new tariff policies instituted by the United States government and foreign governments. As a global company that both imports raw materials and products into the U.S. and distributes raw materials and products originating from the U.S. to global manufacturing sites and markets, these new tariffs may have a financial impact on our cost of goods, our profit margins, our business generally and our global distribution strategy. These new tariffs may cause foreign governments and private purchasers to consider transitioning away from products originating from certain countries (including the U.S.) in favor of buying “local” products resulting in the additional possibility that local manufacturers, brands and other competitors may engage in aggressive competitive pricing to take advantage of the uncertain global trade environment and transition customers away from global manufacturers, all of which may impact the Company’s business and operations.

Changes in Clinical Practice. Introduction of new drugs and increased penetration of oral and once-weekly anti-diabetic drugs (e.g., SGLT-2s, once-weekly insulin, GLP-1s and GLP-1 combination products) have delayed initiation of insulin therapy and contributed to less demand for our products. New drug therapies, including weekly insulin, are targeted to challenge the current diabetes treatment paradigm, including the frequency insulin is dosed (weekly vs. daily injections) and amount of insulin used. Additionally, insulin therapy in developed markets continues to transition to infusion pumps.

Decentralization of Chronic Care. Many countries are facing an aging population and a rapidly growing number of people living with diabetes. While healthcare investments in certain regions continue to grow, there is an increased burden on physicians and longer wait times for patients. Healthcare delivery for non-emergency diabetes care is expected to continue shifting outside of hospitals to primary care providers, which could have a material impact on our results of operations.

Political and Economic Instability in Emerging Markets. We operate in a number of emerging markets, many of which are subject from time to time to significant political and economic disruptions. However, the number of countries we provide products to and our proactive channel management strategies help us manage this variability.

35

Recent Developments

We continue to face increases in the cost and disrupted availability of raw materials, components, and other inputs necessary to manufacture and distribute our products due to constraints and inflation within the global supply chain, as well as increases in the cost and time to distribute our products. To date we have been able to successfully mitigate this disruption and provide uninterrupted supply to our customers by increasing our inventory levels and taking other measures. Given our global business, we expect recently announced tariffs will result in additional cost for us and our suppliers, and there is the potential that such tariffs may influence future decisions by foreign governments and private purchasers to source non-U.S., “locally” manufactured products instead of products originating from certain countries (including the U.S.) and that local manufacturers, brands and other competitors may engage in aggressive competitive pricing or other strategies to take advantage of the uncertain global trade environment and transition customers away from global manufacturers. Tariffs did not have a material impact on our fiscal year 2025 results. We will continue to monitor the evolving tariff environment and we will focus on optimizing operations and leveraging existing strategies to reduce the impact from tariffs.

On November 22, 2024, the Company's Board of Directors approved a plan to discontinue internal and external investment in the research and development of our patch pump program. As a result, the Company incurred organizational restructuring plan (the "Patch Pump Restructuring Plan") costs of $34.5 million during the year ended September 30, 2025. Restructuring actions associated with the Patch Pump Restructuring Plan to discontinue the patch pump program are substantially complete as of September 30, 2025. In addition, we discontinued our commercial operation plans for the insulin delivery system, including the previous intended limited launch. The Company plans to refocus its investment on its core business while looking to optimize free cash flow and strengthen its balance sheet by paying down debt.

During the second quarter of fiscal year 2025, the Company initiated a restructuring plan (the "2025 Restructuring Plan") to streamline the organization and optimize resources. As a result, the Company incurred organizational restructuring plan costs of $3.5 million during the year ended September 30, 2025. The 2025 Restructuring Plan is substantially complete as of September 30, 2025.

We continue to monitor the conflict in Ukraine and the associated sanctions and other restrictions. We also are monitoring the conflicts in the Middle East and Houthi attacks on commercial shipping vessels and other naval vessels. As of November 25, 2025, there is no material impact to our business operations and financial performance as a result of the aforementioned conflicts. However, the full impact of the conflicts on our business operations and financial performance remains uncertain and will depend on future developments, including the severity and duration of the conflicts and their impact on regional and global economic conditions. We will continue to monitor these conflicts and assess the related restrictions and other effects on our business. See Item 1A of this Annual Report on Form 10-K for further details.

In addition, our revenues and results of operations have been affected by various fluctuations in macroeconomic conditions and regulatory and policy changes, both on a global level and in particular markets, which include inflation and slowing economic growth and contractions, a changing interest rate environment, supply chain interruptions, tariff policy changes, volatility in capital markets and the availability of credit, tax rates and the rate of exchange between the United States dollar and foreign currencies. The nature and extent of the impact of these factors among others varies by region and remains uncertain and unpredictable and may affect our business.

36

Results of Operations

For a discussion of Results of Operations of fiscal year 2024 compared to fiscal year 2023 see our Annual Report on Form 10-K for the year ended September 30, 2024.

For the fiscal years ended September 30, 2025 and 2024, our Consolidated Statements of Income are as follows:

2025

2024

Revenues

$

1,080.4 

$

1,123.1 

Cost of products sold

403.6 

387.9 

Gross Profit

676.8 

735.2 

Operating expenses:

Selling and administrative expense

332.0 

365.1 

Research and development expense

37.3 

78.8 

Other operating expenses

65.4 

124.5 

Total Operating Expenses

434.7 

568.4 

Operating Income

242.1 

166.8 

Interest expense, net

(107.3)

(112.3)

Other income (expense), net

1.5 

(10.3)

Income Before Income Taxes

136.3 

44.2 

Income tax provision (benefit)

40.9 

(34.1)

Net Income

$

95.4 

$

78.3 

Net Income per common share:

Basic

$

1.64 

$

1.36 

Diluted

$

1.62 

$

1.34 

Year Ended September 30, 2025 Summary (on a comparative basis)

Key financial results for the year ended September 30, 2025 were as follows:

•Revenue decreased by $42.7 million to $1,080.4 million from $1,123.1 million;

•Gross profit decreased by $58.4 million to $676.8 million, compared to $735.2 million. Gross profit as a percent of revenue was 62.6%, as compared to 65.5% in the prior year comparative period;

•Operating income increased by $75.3 million to $242.1 million from $166.8 million; and

•Net income increased by $17.1 million to $95.4 million from $78.3 million.

Revenues

Our revenues decreased by $42.7 million, or 3.8%, to $1,080.4 million for the year ended September 30, 2025 as compared to revenues of $1,123.1 million for the year ended September 30, 2024. Changes in our revenues are driven by the volume of goods that we sell, the prices we negotiate with customers, and changes in foreign exchange rates. The decrease in reported revenues was primarily driven by $52.9 million of unfavorable changes in volume and $3.5 million associated with the negative impact of foreign currency translation primarily due to the strengthening of the U.S. dollar. This was partially offset by a $6.9 million increase in contract manufacturing revenues related to sales of non-diabetes products to BD, $4.8 million of favorable changes in gross-to-net adjustments attributed to the recognition of higher incremental Italian payback accruals in fiscal year 2024 as compared to fiscal year 2025, and a $2.0 million increase associated with favorable changes in price. See Item 1A of this Annual Report on Form 10-K for further details.

Cost of products sold

Cost of products sold increased by $15.7 million, or 4.0%, to $403.6 million for the year ended September 30, 2025 as compared to $387.9 million for the year ended September 30, 2024. Cost of products sold as a percentage of revenues were 37.4% for the year ended September 30, 2025 as compared to 34.5% for the year ended September 30, 2024. The increase in cost of products sold was primarily driven by the impact of net changes from profit in inventory adjustments period over period and non-cash asset impairment charges recorded to write down the carrying value of certain property and equipment

37

as a result of the Company's Patch Pump Restructuring Plan. This was partially offset by lower volumes in fiscal year 2025 compared to fiscal year 2024.

Selling and administrative expenses

Our selling and administrative expenses decreased by $33.1 million, or 9.1%, to $332.0 million for the year ended September 30, 2025 as compared to $365.1 million for the year ended September 30, 2024. The decrease year over year was primarily driven by lower TSA and LSA costs with BD in addition to lower compensation expense recognized in fiscal year 2025.

Research and development expenses

Our research and development expenses decreased by $41.5 million, or 52.7%, to $37.3 million for the year ended September 30, 2025 as compared to $78.8 million for the year ended September 30, 2024. The decrease was primarily driven by a reduction in payments made in connection with the development of our insulin patch pump program in fiscal year 2025 as compared to fiscal year 2024, given the discontinuation of the patch pump program.

Other operating expenses

Other operating expenses are as follows:

Twelve months ended September 30,

2025

2024

Costs related to the Separation

$

31.3 

$

110.8 

Amortization of cloud computing arrangements

10.4

6.3

Costs associated with the discontinued patch pump program

15.7 

—

Business optimization and severance related costs

7.3

7.4

Other

0.7 

—

Total

$

65.4 

$

124.5 

Other operating expenses incurred primarily consist of the following:

•Accounting, auditing, legal services, marketing, supply chain, employee retention, costs associated with the implementation of our new ERP system and other Interim Business Continuity Processes, costs associated with brand transition, and certain other costs to establish certain stand-alone functions to assist with the transition to being a stand-alone entity;

•Restructuring related costs associated with the optimization of certain business functions as we transition to being a stand-alone entity;

•Severance and contract termination costs associated with the discontinued patch pump program; and

•Costs recognized associated with the amortization of cloud computing arrangements.

Interest expense, net

Interest expense, net decreased to $107.3 million for the year ended September 30, 2025, from $112.3 million for the year ended September 30, 2024 primarily driven by lower debt levels and lower short-term interest rates in the current period as compared to the prior period. We are unable to predict future Federal Reserve interest rate decisions and the impact to interest expense on our variable rate debt. See "Liquidity and Capital Resources" below and Note 12 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for a further description of our long-term debt.

Other income (expense), net

Other income (expense), net was $1.5 million and $(10.3) million for the years ended September 30, 2025 and 2024, respectively. The income generated in fiscal year 2025 was primarily attributed to favorable impacts from foreign exchange. The costs incurred for fiscal year 2024 were primarily attributed to amounts due to BD for income taxes payable incurred in deferred jurisdictions where BD is considered the primary obligor and the unfavorable impacts from foreign exchange.

38

Income tax provision (benefit)

Income tax provision (benefit) increased to $40.9 million for the year ended September 30, 2025 from $(34.1) million for the year ended September 30, 2024. This increase was primarily due to the absence of 2024 tax benefits from the recognition of deferred tax assets related to tax reform in Switzerland, the absence of 2024 tax benefits from the reduction of withholding tax accruals on unremitted foreign earnings resulting from the expiration of certain stock ownership holding period requirements, fewer nontaxable items of income and the correlative tax impacts of these changes on higher overall earnings in 2025. This was partially offset by tax benefits from tax return true ups for tax filings made during 2025.

See Note 14 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for a further description of our provision for income taxes.

LIQUIDITY AND CAPITAL RESOURCES

For discussion on Liquidity and Capital Resources pertaining to the fiscal years 2024 and 2023 see our Annual Report on Form 10-K for the fiscal year ended September 30, 2024.

We believe that our cash and our cash equivalents and cash from operations, together with our borrowing capacity under our revolving credit facility, will provide sufficient financial flexibility to fund seasonal and other working capital requirements, capital expenditures, debt service requirements and other obligations, cash dividends on common shares and additional growth opportunities for the foreseeable future. However, should it become necessary, we believe that our credit profile should provide us with access to additional financing in order to fund normal business operations, make interest payments, fund growth opportunities and satisfy upcoming debt maturities.

Debt-Related Activities

In February 2022, and in connection with the Separation, Embecta issued $500.0 million aggregate principal amount of 5.00% senior secured notes due February 15, 2030 (the "5.00% Notes"). Interest payments on the 5.00% Notes are due semi-annually in February and August until maturity. Interest payments began in August 2022.

In March 2022, Embecta entered into a credit agreement, providing for a Term Loan B Facility (the "Term Loan") in the amount of $950.0 million, with a seven-year term that matures in March 2029 and a Revolving Credit Facility in an aggregate principal amount of up to $500.0 million, with a five-year term that matures in 2027. The interest rate on the Term Loan is 300 basis points over the secured overnight financing rate (“SOFR”), with a 0.50% SOFR floor. Principal and interest payments on the Term Loan began on June 30, 2022. Such quarterly principal payments are calculated as 0.25% of the initial principal amount, with the remaining balance payable upon maturity. Principal amounts repaid under the Term Loan may not be reborrowed by us. The Company may from time to time voluntarily prepay the Term Loan in whole or in part without premium or penalty subject to certain exceptions. Borrowings under the Revolving Credit Facility bear interest, at Embecta’s option, initially at an annual rate equal to (a) in the case of loans denominated in United States dollars (i) the SOFR or (ii) the alternate base rate or (b) in the case of loans denominated in Euros, the EURIBOR rate, in each case plus an applicable margin specified in the credit agreement. A commitment fee applies to the unused portion of the Revolving Credit Facility, equal to 0.25% per annum. As of September 30, 2025, no amount has been drawn on the Revolving Credit Facility.

Additionally, Embecta has outstanding $200.0 million of senior secured notes (the "6.75% Notes"), which carry an interest rate of 6.75% and are due February 2030. Interest payments on the 6.75% Notes are due semi-annually in February and August until maturity. Interest payments began in August 2022.

The following is a summary of Embecta's total debt outstanding as of September 30, 2025:

Term Loan

$

716.8

5.00% Notes

500.0

6.75% Notes

200.0

Total principal debt issued

$

1,416.8

Less: current debt obligations

(9.5)

Less: debt issuance costs and discounts

(18.6)

Long-term debt

$

1,388.7

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The schedule of principal payments required on long-term debt for the next five years and thereafter is as follows:

2026

$

9.5 

2027

9.5 

2028

9.5 

2029

688.3 

2030

700.0 

Thereafter

— 

Certain measures relating to our total debt outstanding as of September 30, 2025 were as follows:

Total debt

$

1,398.2 

Short-term debt as a percentage of total debt

0.7 

%

Weighted average cost of total debt

6.4 

%

The credit agreement and the indentures for the 5.00% Notes and the 6.75% Notes contain customary financial covenants, including a total net leverage ratio covenant, which measures the ratio of (i) consolidated total net debt to (ii) consolidated earnings before interest, taxes, depreciation and amortization, and subject to other adjustments, must meet certain defined limits which are tested on a quarterly basis in accordance with the terms of the credit agreement and indentures governing the 5.00% Notes and the 6.75% Notes. In addition, the credit agreement contains covenants that limit, among other things, our ability to prepay, redeem or repurchase our subordinated and junior lien debt, incur additional debt, make acquisitions, merge with other entities, pay dividends or distributions, redeem or repurchase equity interests, and create or become subject to liens. As of September 30, 2025, we were in compliance with all of such covenants. The credit agreement and the senior secured notes are secured by substantially all assets of Embecta and each subsidiary guarantor, subject to certain exceptions.

During the year ended September 30, 2025 , the Company paid an aggregate principal amount of approximately $184.6 million on the Term Loan, of which $175.1 million was discretionary. Debt extinguishment charges as a result of these discretionary prepayments were not material to the Company's Consolidated Statements of Income.

We may, from time to time, seek to retire or repurchase our outstanding debt through cash purchases and/or exchanges for equity or debt, in open-market purchase, or privately negotiated transactions, or otherwise may redeem some or all of our debt pursuant to its terms. Such repurchases or exchanges, if any, will depend upon various factors existing at the time, including prevailing market conditions, our liquidity requirements, contractual restrictions and other factors, and there can be no assurance as to which, if any, of these alternatives, or combination thereof, we may choose to pursue in the future.

For additional information related to the Company's debt related activities, refer to Note 12 within the Notes to Consolidated Financial Statements within this Form 10-K.

Leases

Maturities of our finance lease and operating lease liabilities as of September 30, 2025 by fiscal year are as follows:

Finance Lease

Operating Leases

Total

2026

3.7 

5.9 

9.6 

2027

3.8 

2.6 

6.4 

2028

3.9 

2.0 

5.9 

2029

3.9 

2.1 

6.0 

2030

4.0 

1.8 

5.8 

Thereafter

28.3 

5.7 

34.0 

Total lease payments

$

47.6 

$

20.1 

$

67.7 

For additional information related to our leases, refer to Note 18 within the Notes to Consolidated Financial Statements of this Form 10-K.

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Receivables Sale Agreement

During the third quarter of fiscal year 2025, the Company entered into a trade receivables sale agreement with a third-party financial institution to sell certain trade receivables of the Company at a discount on an uncommitted basis. These trade receivable sales are accounted for as a sale of assets, as the Company's continuing involvement is limited to servicing the accounts receivables. The Company receives the sales price, equal to the trade receivable less the applicable discount, at the time of sale.

In connection with the Company's receivables sale agreement, $63.2 million of trade receivables were sold during fiscal year 2025, resulting in derecognition of the receivables from the Company's Consolidated Balance Sheets. Discounts recognized on the sale of trade receivables were not material to the Company's Consolidated Statements of Income. The cash received on the sale of trade receivables during fiscal year 2025 is presented in changes in trade receivables, net within operating activities in the Consolidated Statement of Cash Flows.

Access to Capital and Credit Ratings

In May 2025 and June 2025, Moody’s Investor Services and Standard & Poor’s Ratings Services published updates and reaffirmed our preexisting credit ratings. Our Moody's Investors Services credit rating is B1 and our Standard & Poor's Rating Services credit rating is B+.

Cash and equivalents and restricted cash were $228.6 million as of September 30, 2025 as compared to $274.2 million as of September 30, 2024.

The primary sources and uses of cash that contributed to the $45.6 million decrease were:

September 30, 2024 Cash and equivalents and restricted cash balance

$

274.2 

Cash provided by operating activities

191.7 

Cash used for investing activities

(9.3)

Cash used for financing activities

(226.7)

Effect of exchange rate changes on cash and equivalents and restricted cash

(1.3)

September 30, 2025 Cash and equivalents and restricted cash balance

$

228.6 

Net cash provided by operating activities was primarily attributable to:

Net income

$

95.4 

Non-cash adjustments related to depreciation and amortization, impairment of property, plant, and equipment, stock-based compensation, and deferred income taxes

120.0 

Change in in accounts payable and accrued expenses

(68.9)

Change in trade receivables

44.2 

Change in inventories

(6.1)

Change in amounts due from/due to Becton, Dickinson and Company

25.3 

Change in prepaid expenses and other

8.5 

Change in income and other net taxes payable

(28.1)

Change in other assets and liabilities, net

1.4 

Net cash provided by operating activities

$

191.7 

The change in accounts payable and accrued expenses is primarily due to timing attributable to payments to vendors.

The change in trade receivables is primarily attributed to the timing of sales and receivables factored.

The change in inventories is primarily attributed to actions taken to build inventory to support the execution of our brand transition program.

The change in amounts due from/due to Becton, Dickinson and Company is attributed to the timing of payments associated with certain agreements effectuated at Separation.

The change in prepaid expenses and other is primarily attributed to timing of payments to vendors.

The change in income and other net taxes payable is primarily attributed to timing of required tax payments.

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The change in other assets and liabilities, net is primarily attributed to costs capitalized attributed to cloud computing arrangements.

All other movements related to working capital were due to timing of payments and receipts of cash in the ordinary course of business.

Net cash used for investing activities was comprised of capital expenditures of $9.3 million for the fiscal year to support our business and operations.

Net cash used for financing activities was primarily attributable to:

Dividend payments

(35.0)

Payments on long-term debt

(184.6)

Payments related to tax withholding for stock-based compensation

(5.7)

Payments on finance lease

(1.4)

Net cash used for financing activities

$

(226.7)

Contractual Obligations

Our contractual obligations as of September 30, 2025, which require material cash requirements in the future, consist of purchase obligations and lease obligations. Purchase obligations are enforceable and legally binding obligations for purchases of goods and services which include inventory purchase commitments. Over the next several years, we expect to incur material costs associated with operating and maintaining our information technology infrastructure. Lease obligations include lease agreements for which a contract has been signed even if the lease has not yet commenced.

As of September 30, 2025, total payments due for purchase obligations and lease obligations aggregate to approximately $143 million and $68 million, respectively. Contractual obligations due within the next twelve months approximate $108 million related to purchase commitments and $10 million related to lease obligations.

Critical Accounting Policies

The following discussion supplements the descriptions of our accounting policies contained in Note 2 to the Consolidated Financial Statements contained in Item 8 of this Annual Report on Form 10-K. Financial Statements and Supplementary Data. The preparation of the Consolidated Financial Statements requires management to use estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements. Some of those judgments can be subjective and complex and, consequently, actual results could differ from those estimates. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. For any given estimate or assumption made by management, it is possible that other people applying reasonable judgment to the same facts and circumstances could develop different estimates. Actual results that differ from management’s estimates could have an unfavorable effect in our Consolidated Financial Statements. Management believes the following critical accounting policies reflect the more significant judgments and estimates used in the preparation of the Consolidated Financial Statements:

Revenue Recognition

Our revenues are primarily recognized when the customer obtains control of the product sold, which is generally upon shipment or delivery, depending on the delivery terms specified in the distribution or sales agreement.

Our gross revenues are subject to a variety of deductions, which include rebates, chargebacks, sales discounts and sales returns. These deductions represent estimates of the related obligations, and judgment is required when determining the impact of these revenue deductions on gross revenues for a reporting period. Rebates are based upon prices determined under our agreements with the end-user customers. Additional factors considered in the estimate of our rebate liability include the quantification of inventory that is either in stock at or in transit to our distributors, as well as the estimated lag time between the sale of product and the payment of corresponding rebates.

Income Taxes

Income taxes are accounted for using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial statement and tax basis of assets and liabilities at the applicable tax rates.

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We maintain valuation allowances where it is more likely than not that all or a portion of a deferred tax asset will not be realized. Changes in valuation allowances are included in the tax provision in the period of change. In determining whether a valuation allowance is warranted, we evaluate factors such as prior earnings history, expected future earnings, carryback and carryforward periods, and tax strategies that could potentially enhance the likelihood of the realization of a deferred tax asset.

From time to time, the Company engages in transactions in which tax consequences may be subject to uncertainty. The Company conducts business and files tax returns in numerous jurisdictions based on its interpretation of tax laws and regulations. In evaluating the Company’s tax provision, the Company establishes a reserve for uncertain tax positions unless such positions are determined to be more likely than not of being sustained upon examination based on the technical merits. The Company’s policy is to recognize, when applicable, interest and penalties related to income taxes as part of income tax expense.

Additional disclosures regarding our accounting for income taxes are provided in Note 14 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.

Cautionary Statements Regarding Forward-Looking Statements

This Annual Report on Form 10-K contains statements that constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995 and other securities laws. Forward-looking statements include those containing such words as “anticipates,” “believes,” "can," “could,” “estimates,” “expects,” “forecasts,” “goal,” “guidance,” “intends,” “may,” “outlook,” “plans,” "possible," “projects,” “seeks,” “sees,” “should,” “targets,” “will,” “would,” or other words of similar meaning. All statements that reflect Embecta’s expectations, assumptions or projections about the future, other than statements of historical fact, are forward-looking statements, including, without limitation, forecasts relating to discussions of future operations and financial performance (including volume growth, pricing, sales and earnings per share growth and cash flows), restructuring expenses and charges, and statements regarding Embecta’s strategy for growth and paying down debt, the Patch Pump Restructuring Plan, the 2025 Restructuring Plan, expectations related to the impact of incremental tariffs, brand transition, future product development, anticipated product and regulatory clearances, approvals, and launches, competitive position and expenditures. Forward-looking statements are based upon our present intent, beliefs or expectations, are not guarantees of future performance and are subject to numerous risks, uncertainties, and changes in circumstances that are difficult to predict. Although Embecta believes that the expectations reflected in any forward-looking statements it makes are based on reasonable assumptions, it can give no assurance that these expectations will be attained and it is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks and uncertainties. Such risks and uncertainties include, but are not limited to:

•Competitive factors that could adversely affect Embecta’s operations, including adoption of new drug therapies for treatment of diabetes, new product introductions by Embecta’s competitors, the development of new technologies, lower cost producers that create pricing pressure and consolidation resulting in companies with greater scale and market presence than Embecta.

•The risk that Embecta is unable to replace the services, including the Business Continuity Processes, that BD currently provides to it on substantially similar terms as the terms on which BD is providing these services under the transaction agreements or that BD terminates such services.

•Any failure by BD to perform its obligations under the various separation agreements entered into in connection with the Separation and distribution, including the cannula supply agreement.

•Any events that adversely affect the sale or profitability of one of Embecta’s key products or the revenue delivered from sales to its key customers.

•Increases in operating costs, including costs incurred from the new tariffs instituted by the U.S. government and certain foreign governments on raw materials and products, fluctuations in the cost and availability of oil-based resins, other raw materials, and energy as well as certain components, used in its products, the ability to maintain favorable supplier arrangements and relationships, and the potential adverse effects of any disruption in the availability of such items.

•The risk that as a result of the current global trade environment from the newly instituted tariffs, certain foreign governments, private purchasers and other customers in certain countries may consider transitioning away from products originating from certain countries (including the U.S.) in favor of buying “local” products and local manufacturers and competitors may attempt to capitalize on these sentiments and participate in aggressive competitive pricing or other strategies to transition, or divert, current and potential customers away Embecta.

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•Embecta’s ability to obtain clearance from the FDA or foreign regulatory authorities of any product, to market and sell such products successfully, to anticipate the needs of people with diabetes, and future business decisions by Embecta and its competitors.

•Changes in reimbursement practices of governments or private payers or other cost containment measures.

•The adverse financial impact resulting from unfavorable changes in foreign currency exchange rates, as well as regional, national and foreign economic factors, including inflation, deflation, and fluctuations in interest rates, and their potential effect on its operating performance.

•The impact of changes in United States, federal laws, and policy that could affect fiscal and tax policies, healthcare and international trade, including import and export regulation, tariffs, and international trade agreements. In particular, tariffs or other trade barriers imposed by the United States or other countries could adversely impact its supply chain costs or otherwise adversely impact its results of operations.

•Any future impact of pandemics or geopolitical instability on Embecta’s business, including disruptions in its operations and supply chains.

•New or changing laws and regulations affecting Embecta’s domestic and foreign operations, or changes in enforcement practices, including laws relating to healthcare, environmental protection, trade, monetary and fiscal policies, taxation (including tax reforms that could adversely impact multinational corporations) and licensing and regulatory requirements for products.

•The expected benefits of the Separation from BD.

•Risks associated with indebtedness and our use of indebtedness available to us.

•The risk that dis-synergy costs, costs of restructuring transactions and other costs incurred in connection with the Separation will exceed Embecta's estimates.

•The impact of the Separation on Embecta's businesses and the risk that the Separation may be more difficult, time-consuming or costly than expected, including the impact on its resources, systems, including ERP, procedures and controls, diversion of management’s attention and the impact on relationships with customers, suppliers, employees and other business counterparties.

•Embecta’s ability to timely and successfully complete the brand transition, including any resulting regulatory delays of transferring or obtaining registrations and licenses in the “Embecta” name, interruptions in, or customer confusion from, the replacement and transfer of the rebranded product into the current commercialization, supply and distribution networks, or other issues arising out of system, supply chain logistics, administrative and adjudicative operations transitions in the end-to-end product flow and end-user access.

•The expectations related to the costs, profitability, timing and the estimated financial impact of, and charges associated with, the Patch Pump Restructuring Plan and the 2025 Restructuring Plan.

•The risk that we may not complete strategic collaborative partnerships and acquisition opportunities that enable us to accelerate our growth or strategic collaborative opportunities that give us access to innovative technologies, complementary product lines, and new markets.

There can be no assurance that the transactions or uncertainties described above will in fact be consummated or occur in the manner described or at all. As a result, you should not place undue reliance upon our forward-looking statements. The above list of factors is not exhaustive or necessarily in order of importance. For additional information on identifying factors that may cause actual results to vary materially from those stated in forward-looking statements, see the discussions under Item 1A, “Risk Factors,” or in our other filings with the SEC. Any forward-looking statement speaks only as of the date on which it is made, and Embecta expressly disclaims and assumes no obligation to update or revise such statement, whether as a result of new information, future events or otherwise, except as required by applicable law.