METHODE ELECTRONICS INC (MEI)
SIC breadcrumb: Manufacturing > Electronic And Other Electrical Equipment And Components, Except Computer Equipment > SIC 3678 Electronic Connectors
SEC company page: https://www.sec.gov/edgar/browse/?CIK=65270. Latest filing source: 0000950170-25-094822.
Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
|---|---|---|---|---|
| Revenue | 1,048,100,000 | USD | 2025 | 2025-07-09 |
| Net income | -62,600,000 | USD | 2025 | 2025-07-09 |
| Assets | 1,305,800,000 | USD | 2025 | 2025-07-09 |
Financials
Annual standardized facts from SEC companyfacts as of latest extracted filing date 2025-07-09. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000065270.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.
| Metric | 2012 | 2013 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | 816,500,000 | 908,300,000 | 1,000,300,000 | 1,023,900,000 | 1,088,000,000 | 1,163,600,000 | 1,179,600,000 | 1,114,500,000 | 1,048,100,000 | ||||
| Net income | 84,600,000 | 92,900,000 | 57,200,000 | 91,600,000 | 123,400,000 | 122,300,000 | 102,200,000 | 77,100,000 | -123,300,000 | -62,600,000 | |||
| Operating income | 109,700,000 | 110,800,000 | 118,300,000 | 106,800,000 | 147,100,000 | 127,900,000 | 111,700,000 | 90,400,000 | -112,000,000 | -23,900,000 | |||
| Gross profit | 212,900,000 | 218,300,000 | 239,600,000 | 265,800,000 | 282,900,000 | 274,100,000 | 264,900,000 | 264,100,000 | 178,800,000 | 163,400,000 | |||
| Diluted EPS | 0.22 | 1.08 | 1.52 | 2.43 | 3.26 | 3.19 | 2.70 | 2.10 | -3.48 | -1.77 | |||
| Operating cash flow | 110,700,000 | 145,200,000 | 117,800,000 | 102,000,000 | 140,600,000 | 179,800,000 | 98,800,000 | 132,800,000 | 47,500,000 | 26,400,000 | |||
| Capital expenditures | 23,200,000 | 22,400,000 | 47,700,000 | 49,800,000 | 45,100,000 | 24,900,000 | 38,000,000 | 42,000,000 | 50,200,000 | 41,600,000 | |||
| Dividends paid | 13,500,000 | 13,700,000 | 14,700,000 | 16,300,000 | 16,300,000 | 17,400,000 | 20,400,000 | 19,800,000 | 19,900,000 | 20,400,000 | |||
| Share buybacks | 0.00 | 62,300,000 | 9,800,000 | 0.00 | 0.00 | 6,700,000 | 64,500,000 | 48,100,000 | 13,700,000 | 1,600,000 | |||
| Assets | 655,900,000 | 704,000,000 | 915,900,000 | 1,231,700,000 | 1,370,600,000 | 1,467,000,000 | 1,389,100,000 | 1,579,100,000 | 1,403,500,000 | 1,305,800,000 | |||
| Liabilities | 285,900,000 | 542,000,000 | 587,200,000 | 549,000,000 | 475,300,000 | 626,200,000 | 637,500,000 | 612,500,000 | |||||
| Stockholders' equity | 470,100,000 | 541,100,000 | 630,000,000 | 689,700,000 | 783,400,000 | 918,000,000 | 913,800,000 | 941,800,000 | 766,000,000 | 693,300,000 | |||
| Cash and cash equivalents | 227,800,000 | 294,000,000 | 246,100,000 | 83,200,000 | 217,300,000 | 233,200,000 | 172,000,000 | 157,000,000 | 161,500,000 | 103,600,000 | |||
| Free cash flow | 87,500,000 | 122,800,000 | 70,100,000 | 52,200,000 | 95,500,000 | 154,900,000 | 60,800,000 | 90,800,000 | -2,700,000 | -15,200,000 |
Ratios
| Metric | 2012 | 2013 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Net margin | 11.38% | 6.30% | 9.16% | 12.05% | 11.24% | 8.78% | 6.54% | -11.06% | -5.97% | ||||
| Operating margin | 13.57% | 13.02% | 10.68% | 14.37% | 11.76% | 9.60% | 7.66% | -10.05% | -2.28% | ||||
| Return on equity | 18.00% | 17.17% | 9.08% | 13.28% | 15.75% | 13.32% | 11.18% | 8.19% | -16.10% | -9.03% | |||
| Return on assets | 12.90% | 13.20% | 6.25% | 7.44% | 9.00% | 8.34% | 7.36% | 4.88% | -8.79% | -4.79% | |||
| Liabilities / equity | 0.45 | 0.79 | 0.75 | 0.60 | 0.52 | 0.66 | 0.83 | 0.88 | |||||
| Current ratio | 4.21 | 4.26 | 3.50 | 2.51 | 3.93 | 3.03 | 3.34 | 2.91 | 2.76 | 2.40 |
Financial Charts
Quarterly
Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-05. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000065270.json.
| Quarter | End Date | Revenue | Net Income | Diluted EPS | Method |
|---|---|---|---|---|---|
| 2021-Q3 | 2021-01-30 | 0.83 | reported discrete quarter | ||
| 2022-Q3 | 2022-01-29 | 0.78 | reported discrete quarter | ||
| 2023-Q2 | 2022-10-29 | 315,900,000 | 27,600,000 | 0.75 | reported discrete quarter |
| 2023-Q3 | 2023-01-28 | 280,100,000 | 19,900,000 | 0.54 | reported discrete quarter |
| 2023-Q4 | 2023-04-29 | 301,200,000 | 8,100,000 | derived Q4 = FY annual - nine-month YTD | |
| 2023-Q1 | 2023-07-29 | 0.02 | reported discrete quarter | ||
| 2024-Q2 | 2023-10-28 | 288,000,000 | -55,300,000 | -1.55 | reported discrete quarter |
| 2024-Q3 | 2024-01-27 | 259,500,000 | -11,600,000 | -0.33 | reported discrete quarter |
| 2024-Q4 | 2024-04-27 | 277,300,000 | -57,300,000 | derived Q4 = FY annual - nine-month YTD | |
| 2025-Q1 | 2024-07-27 | 258,500,000 | -18,300,000 | -0.52 | reported discrete quarter |
| 2025-Q3 | 2025-02-01 | 239,900,000 | -14,400,000 | -0.41 | reported discrete quarter |
| 2025-Q4 | 2025-05-03 | 257,100,000 | -28,300,000 | derived Q4 = FY annual - nine-month YTD | |
| 2026-Q1 | 2025-08-02 | 240,500,000 | -10,300,000 | -0.29 | reported discrete quarter |
| 2026-Q2 | 2025-11-01 | 246,900,000 | -9,900,000 | -0.28 | reported discrete quarter |
| 2026-Q3 | 2026-01-31 | 233,700,000 | -15,900,000 | -0.45 | reported discrete quarter |
Quarterly Charts
Macro Cross-References
- CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- UNRATE - Unemployment Rate
- FEDFUNDS - Federal Funds Effective Rate
- CES0500000003 - Average Hourly Earnings of All Employees, Total Private
- DFEDTARU - Federal Funds Target Range - Upper Limit
- DFEDTARL - Federal Funds Target Range - Lower Limit
- DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
- DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
- CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
- CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
- PCEPI - Personal Consumption Expenditures: Chain-type Price Index
- PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
- PPIACO - Producer Price Index by Commodity: All Commodities
- T10YIE - 10-Year Breakeven Inflation Rate
- U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
- PAYEMS - All Employees, Total Nonfarm
- CIVPART - Labor Force Participation Rate
- EMRATIO - Employment-Population Ratio
- UNEMPLOY - Unemployed
- CE16OV - Employment Level
- ICSA - Initial Claims
- JTSJOL - Job Openings: Total Nonfarm
- JTSQUR - Quits: Total Nonfarm
- GDPC1 - Real Gross Domestic Product
- A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
- INDPRO - Industrial Production: Total Index
- TCU - Capacity Utilization: Total Index
- HOUST - New Privately-Owned Housing Units Started: Total Units
- PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- RSAFS - Advance Retail Sales: Retail Trade
- PCE - Personal Consumption Expenditures
- DSPIC96 - Real Disposable Personal Income
- PSAVERT - Personal Saving Rate
- M2SL - M2
- BOPGSTB - U.S. International Trade in Goods and Services: Balance
- MSPUS - Median Sales Price of Houses Sold for the United States
- HSN1F - New One Family Houses Sold: United States
- RHORUSQ156N - Homeownership Rate in the United States
- TTLCONS - Total Construction Spending: Total Construction in the United States
- RRVRUSQ156N - Rental Vacancy Rate in the United States
- TOTALSL - Total Consumer Credit Owned and Securitized
- REVOLSL - Revolving Consumer Credit Owned and Securitized
- DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
- GDP - Gross Domestic Product
- GPDI - Gross Private Domestic Investment
- GCE - Government Consumption Expenditures and Gross Investment
- PCEC - Personal Consumption Expenditures
- NETEXP - Net Exports of Goods and Services
- GFDEBTN - Federal Debt: Total Public Debt
- GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
- FYFSD - Federal Surplus or Deficit
- FGRECPT - Federal Government Current Receipts
- FGEXPND - Federal Government: Current Expenditures
- MANEMP - All Employees, Manufacturing
- USCONS - All Employees, Construction
- USTRADE - All Employees, Retail Trade
- USFIRE - All Employees, Financial Activities
- USGOVT - All Employees, Government
- AWHAETP - Average Weekly Hours of All Employees, Total Private
- DGORDER - Manufacturers' New Orders: Durable Goods
- NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
- BUSINV - Total Business Inventories
- EXPGS - Exports of Goods and Services
- IMPGS - Imports of Goods and Services
- IR - Import Price Index (End Use): All Commodities
- PPIFIS - Producer Price Index by Commodity: Final Demand
Latest quarter (10-Q)
Latest 10-Q source: 0000065270-26-000007.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations As used herein, “we,” “us,” “our,” the “Company” or “Methode” means Methode Electronics, Inc. and its subsidiaries. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q (“Quarterly Report”) includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect, when made, our current views with respect to current events and financial performance. Such forward-looking statements are subject to many risks, uncertainties and factors relating to our operations and business environment, which may cause our actual results to be materially different from any future results, express or implied, by such forward-looking statements. All statements that address future operating, financial or business performance or our strategies or expectations are forward-looking statements. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “potential,” “outlook” or “continue,” and other comparable terminology. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the following: • Dependence on the automotive, commercial vehicle, and construction industries; • Timing, quality and cost of new program launches; • Changes in electric vehicle (“EV”) demand; • Investment in programs prior to the recognition of revenue; • Production delays or cancelled orders; • Changes in global trade policies, including tariffs; • Failure to attract and retain qualified personnel; • Inflation; • Dependence on the availability and price of materials; • Dependence on a small number of large customers; • Dependence on our supply chain; • Risks related to conducting global operations; • Effects of potential catastrophic events or other business interruptions; • Ability to withstand pricing pressures, including price reductions; • Ability to compete effectively; • Our lengthy sales cycle; • Risks relating to our use of requirements contracts; • Potential work stoppages; • Ability to successfully benefit from acquisitions and divestitures; • Ability to manage our debt levels; • Ability to comply with restrictions and covenants under our credit agreement; • Interest rate changes and variable rate instruments; • Timing and magnitude of costs associated with restructuring activities; • Recognition of goodwill and other intangible asset impairment charges; • Risks associated with inventory; • Ability to remediate a material weakness in our internal control over financial reporting; • Currency fluctuations; • Income tax rate fluctuations; • Judgments related to accounting for tax positions; • Risks associated with litigation and government inquiries; • Risks associated with warranty claims; • Changing government regulations; • Changing requirements by stakeholders on environmental or social matters; • Effects of IT disruptions or cybersecurity incidents; • Ability to innovate and keep pace with technological changes; and • Ability to protect our intellectual property. Additional details and factors are discussed under the caption “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended May 3, 2025 and in Part II, Item 1A of this Quarterly Report. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. Any forward-looking statements made by us speak only as of the date on which they are made. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether as a result of new information, subsequent events or otherwise. 25 Table of Contents Overview We are a leading global supplier of custom engineered solutions with sales, engineering and manufacturing locations in North America, Europe, Middle East, and Asia. We design, engineer, and produce mechatronic products for Original Equipment Manufacturers (“OEMs”) utilizing our broad range of technologies for user interface, light-emitting diode (“LED”) lighting system, power distribution, and sensor applications. Our solutions are found in the end markets of transportation (including automotive, commercial vehicle, e-bike, aerospace, bus and rail), cloud computing infrastructure, construction equipment, and consumer appliances. Macroeconomic Conditions There is continued uncertainty about the future relationship between the U.S. and various other countries with respect to tariffs, trade policies, government regulations, treaties and trade agreements. We are exposed to market risk with respect to increased and volatile duties assessed on raw materials (including copper, steel and aluminum), component parts (including semiconductors), and finished goods we import into the U.S. from our various manufacturing sites, including those in Mexico, China, Egypt, Europe and Canada. Should any of these tariffs or other trade barriers expand, raw materials and finished goods that we import will face higher prices, which could lead to reduced margins or increased prices that could, in turn, cause decreased customer demand. To the extent that we are unable to obtain price increases or there is a significant decrease in customer demand, new or higher tariffs could have a material effect on our results of operations. The US-Israeli strikes in Iran and the Iranian retaliatory strikes in the Middle East have affected the global economy and given rise to potential global security issues that may adversely affect international business and economic conditions. This conflict in the Middle East may cause additional disruption in the supply chains, including logistics issues and inflationary challenges, which may adversely affect our business and results of operations. Additionally, certain of our customers and suppliers may be negatively affect by these events, which in turn may negatively affect the markets where we do business. The global economy continues to experience volatile disruptions including to the commodity, labor, and transportation markets, arising from a combination of geopolitical events and various economic and financial factors. These disruptions have affected our operations and may continue to affect our business, financial condition, and results of operations. As a result of continued inflation, we have implemented measures to mitigate certain adverse effects of higher costs. However, we have been unable to fully mitigate or pass through the increases in our costs to our customers, which will likely continue in the future. Our business in the future will be affected by the broad trend of electrification. The adoption of EVs has been slower than anticipated, which may affect our financial condition, results of operations, and cash flows. Certain of our customers have recently announced shifts to their EV strategies and we are pursuing these customers for price adjustments and other commercial recoveries. If we are not successful in obtaining these recoveries, we may experience production inefficiencies, including underutilized capacity and workforce disruptions, which could affect our profitability and estimates of future cash flows. Global Supply Chain Disruptions We continue to face a variety of supply chain challenges in fiscal 2026, including the procurement of automotive-grade semiconductors. In addition, we have experienced, and may continue to experience, business interruptions, including customer shutdowns and increased material and logistics costs and labor shortages. Changes in government regulations in areas including, but not limited to, trade and tariff regulations as noted above, could also increase our costs. We continue to work closely with suppliers and customers to mitigate and minimize the potential adverse effect from global supply chain disruptions. However, if we are not able to mitigate any direct or indirect supply chain disruptions, this may have a material adverse effect on our financial condition, results of operations, and cash flows. Recent Events Sale of a Business On March 5, 2026, we entered into and closed on an asset purchase agreement with a third party (the “Buyer”) pursuant to which we sold substantially all of the assets of our dataMate business (the “Transaction”). The aggregate consideration for the Transaction consists of a purchase price of approximately $16.4 million, subject to customary working capital adjustments. The Transaction also includes customary representations, warranties, covenants, and indemnification provisions. Due to the proximity of the closing date of the Transaction with the date of the filing of this Quarterly Report on Form 10-Q, the initial accounting for the Transaction, including the determination of the final purchase price adjustment and the allocation of the consideration, is not yet completed. Based on preliminary estimates, we expect to record a gain on the sale in the range of $9.0 million to $10.5 million. Proceeds from the transaction are expected to be used for general corporate purposes, including debt reduction and working capital needs. The dataMate business is included in the Interface segment, and represents less than 2% of our consolidated net sales for both the nine months ended January 31, 2026 and fiscal year ended May 3, 2025. 26 Table of Contents Sale of Assets We finalized a purchase and sale agreement to sell one of our locations to a third party for a purchase price of $4.7 million, which is subject to satisfaction of customary closing conditions and the relocation of the dataMate business. Accordingly, the property has not been classified as held for sale as of January 31, 2026. The net book value of this location as of January 31, 2026 was $3.5 million. The Buyer is expected to relocate the dataMate business on or before April 19, 2026, and the sale of assets is expected to close no later than May 10, 2026. Proceeds from the sale of assets are expected to be used for general corporate purposes, including debt reduction and working capital needs. 27 Table of Contents Consolidated Results of Operations We maintain our financial records on the basis of a 52 or 53-week fiscal year ending on the Saturday closest to April 30. Fiscal 2026 is a 52-week year and fiscal 2025 was a 53-week year. The three months ended January 31, 2026 and February 1, 2025 were each 13-week periods, while the nine months ended January 31, 2026 and February 1, 2025, were 39 and 40-week periods, respectively. The following discussions of comparative results among periods should be reviewed in this context. The table below compares our results of operations between the three and nine months ended January 31, 2026 and the three and nine months ended February 1, 2025: Three Months Ended Nine Months Ended January 31, 2026 February 1, 2025 January 31, 2026 February 1, 2025 (in millions) (13 Weeks) (13 Weeks) (39 Weeks) (40 Weeks) Net sales $ 233.7 $ 239.9 $ 721.1 $ 791.0 Cost of products sold 194.9 198.6 591.1 647.2 Gross profit 38.8 41.3 130.0 143.8 Selling and administrative expenses 39.1 37.7 114.7 126.5 Amortization of intangibles 5.8 5.8 17.4 17.6 Interest expense, net 5.4 5.5 17.0 16.5 Other expense, net 1.6 0.5 4.3 2.9 Income tax expense (benefit) 2.8 6.2 12.7 14.6 Net income (loss) $ (15.9 ) $ (14.4 ) $ (36.1 ) $ (34.3 ) Net sales Net sales decreased $6.2 million, or 2.6%, to $233.7 million in the three months ended January 31, 2026, compared to $239.9 million in the three months ended February 1, 2025. Foreign currency translation increased net sales by $11.7 million. Excluding foreign currency translation [Excerpt truncated for page length; source filing is linked above.]
Latest 10-K MD&A
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Management’s Discussion and Analysis of Financial Condition and Results of Operations is based upon our consolidated financial statements, which have been prepared in accordance with GAAP. You should read the following discussion and analysis in conjunction with our consolidated financial statements and related notes included in this Annual Report. This discussion and analysis of our financial condition and results of operations also contains forward-looking statements that involve risks, uncertainties, and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements because of a variety of factors, including those set forth under Item 1A, “Risk Factors” of this Annual Report. We undertake no duty to update any such forward-looking statements to conform to actual results or changes in our expectations. Overview Our Business We are a leading global supplier of custom engineered solutions with sales, engineering and manufacturing locations in North America, Europe, Middle East and Asia. We design, engineer and produce mechatronic products for OEMs utilizing our broad range of technologies for user interface, LED lighting system, power distribution and sensor applications. Our solutions are found in the end markets of transportation (including automotive, commercial vehicle, e-bike, aerospace, bus and rail), cloud computing infrastructure, construction equipment and consumer appliance. Our business is managed on a segment basis, with those segments being Automotive, Industrial and Interface. We reported a fourth segment, Medical, through fiscal 2024. For more information regarding the business and products of these segments, see Item 1, “Business” of this Annual Report. Trends Affecting Our Business The following trends significantly have and may continue to impact our business, financial condition and results of operations. See the risk factors identified under Item 1A, “Risk Factors” of this Annual Report for more information. Trade Policy/Tariffs We are exposed to market risk with respect to duties currently assessed on raw materials, component parts and finished goods we import into the U.S. Since February 1, 2025 and up to the date of this Annual Report, the U.S. has announced and implemented various tariffs, including: • 25% tariff on imports of automobiles and certain automobile parts into the U.S. from all countries. Automobile parts that meet specific rules of origin under the United States-Mexico-Canada Agreement (“USMCA”) are currently exempt, however it is possible that this exemption may be modified to only include the portion of U.S. content in the automobile part. • 50% tariff on imports of steel and certain steel derivatives into the U.S. • 25% tariff on imports of aluminum and certain aluminum derivatives into the U.S. • Reciprocal tariffs on most imports (currently 10% for most countries). • Incremental 20% tariff on all imports from China into the U.S. Although the U.S. tariffs did not have a material impact on our operating performance in fiscal 2025, the current situation is dynamic and we are continuing to assess the full implications of the changing international trade environment. Given our sizable manufacturing operations in Mexico, China, Europe and Canada, should these tariffs persist or expand, raw materials and finished goods that we import will face higher prices, which could lead to reduced margins or increased prices that could, in turn, cause decreased customer demand. We continue to monitor similar actions by other countries with which we do business. Other countries have and may continue to impose retaliatory tariffs on goods imported into their countries from the U.S. We will seek price increases from our customers to offset these incremental costs. To the extent that we are unable to obtain price increases, the impact of new or higher tariffs could have a material impact on our results of operations. Macroeconomic Conditions The global economy continues to experience volatile disruptions including to the commodity, labor and transportation markets, arising from a combination of geopolitical events and various economic and financial factors. These disruptions have affected our operations and may continue to affect our business, financial condition and results of operations. As a result of continued inflation, we have implemented measures to mitigate certain adverse effects of higher costs. However, we have been unable to fully mitigate or pass through the increases in our costs to our customers, which will likely continue in the future. Our business in the future will be impacted by the broad trend of electrification. The adoption of EVs has been slower than anticipated, which may impact our financial condition and results of operations. In addition, there are various government policies, subsidies, and economic incentives designed to increase EV adoption. There is no guarantee these incentive programs will be available in the future. 21 Table of Contents Global Supply Chain Disruptions Although we saw improvements in our supply chain in fiscal 2025, including easing of the worldwide semiconductor supply shortage, new supply chain disruptions may occur in the future. In addition, we have experienced, and may continue to experience, business interruptions, including customer shutdowns and increased material and logistics costs and labor shortages. Changes in government regulations in areas including, but not limited to, trade and tariff regulations as noted above, could also increase our costs. We continue to work closely with suppliers and customers to minimize the potential adverse impact from global supply chain disruptions. However, if we are not able to mitigate any direct or indirect supply chain disruptions, this may have a material adverse impact on our financial condition, results of operations and cash flows. Consolidated Results of Operations A detailed comparison of our results of operations between fiscal 2024 and fiscal 2023 can be found in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our fiscal 2024 Annual Report on Form 10-K filed with the SEC on July 11, 2024 The table below compares our results of operations between fiscal 2025 and fiscal 2024: Fiscal Year Ended May 3, 2025 April 27, 2024 (in millions) (53 Weeks) (52 Weeks) Net sales $ 1,048.1 $ 1,114.5 Cost of products sold 884.7 935.7 Gross profit 163.4 178.8 Selling and administrative expenses 163.9 160.9 Goodwill impairment — 105.9 Amortization of intangibles 23.4 24.0 Interest expense, net 22.0 16.7 Other expense (income), net 4.2 (0.6 ) Income tax expense (benefit) 12.5 (4.8 ) Net loss $ (62.6 ) $ (123.3 ) Net sales Net sales decreased $66.4 million, or 6.0%, to $1,048.1 million in fiscal 2025, compared to $1,114.5 million in fiscal 2024. The decrease was primarily due to lower sales in the Automotive segment and unfavorable foreign currency translation of $0.7 million, partially offset by higher sales in the Industrial segment. Excluding the impact of foreign currency translation, net sales decreased $65.7 million, or 5.9%. Cost of products sold Cost of products sold decreased $51.0 million, or 5.5%, to $884.7 million (84.4% of net sales) in fiscal 2025, compared to $935.7 million (84.0% of net sales) in fiscal 2024. Foreign currency translation decreased cost of products sold by $0.3 million. Excluding foreign currency translation, cost of products sold decreased $51.3 million. The decrease was primarily due to lower material and freight costs as a result of a decrease in sales volumes, lower premium freight and lower restructuring costs, partially offset by higher inventory obsolescence expense of $10.0 million. Restructuring and impairment charges included within cost of products sold were $1.1 million in fiscal 2025, compared to $1.7 million in fiscal 2024. Gross profit margin Gross profit margin was 15.6% of net sales in fiscal 2025, compared to 16.0% of net sales in fiscal 2024. The decrease in gross profit margin was primarily a result of higher inventory obsolescence expense, partially offset by favorable product mix from higher sales in the Industrial segment. Selling and administrative expenses Selling and administrative expenses increased $3.0 million, or 1.9%, to $163.9 million (15.6% of net sales) in fiscal 2025, compared to $160.9 million (14.4% of net sales) in fiscal 2024. Excluding foreign currency translation, selling and administrative expenses increased $3.1 million. The increase was primarily due to higher professional fees and stock-based compensation expense, partially offset by lower cash incentive compensation and salary expense and lower restructuring costs. Professional fees in fiscal 2025 include $9.8 million for consulting and interim executive services provided by AlixPartners. Stock-based compensation expense was higher due to a $3.6 million reversal of expense due to forfeitures in fiscal 2024 as well as new awards in fiscal 2025. Restructuring and impairment charges included within selling and administrative expenses were $1.6 million in fiscal 2025, compared to $2.0 million in fiscal 2024. 22 Table of Contents Goodwill impairment In fiscal 2024, we recognized goodwill impairment of $105.9 million in the Automotive segment. For further information, see Note 6, “Goodwill and Other Intangible Assets” to the consolidated financial statements included in this Annual Report. Amortization of intangibles Amortization of intangibles decreased $0.6 million, or 2.5%, to $23.4 million in fiscal 2025, compared to $24.0 million in fiscal 2024. The decrease was a result of fully amortizing a portion of intangible assets. Interest expense, net Interest expense, net was $22.0 million in fiscal 2025, compared to $16.7 million in fiscal 2024. The increase was due to higher borrowing rates. Other expense (income), net Other expense, net was $4.2 million in fiscal 2025, compared to other income, net of $0.6 million in fiscal 2024. The decrease was due to higher foreign exchange losses and lower net gains on sale of assets, partially offset by higher international government assistance. Net foreign exchange loss was $5.5 million in fiscal 2025, compared to $2.2 million in fiscal 2024. Net foreign exchange losses were higher in fiscal 2025 due to lower efficiency in our foreign currency balance sheet remeasurement hedging program. Net gains on sale of assets was $0.5 million in fiscal 2025, compared to $2.6 million in fiscal 2024. The net gain on sale of assets in fiscal 2024 included a $2.4 million gain on the sale of the company aircraft. In fiscal 2025, we received $2.2 million of international government assistance, compared to $0.5 million in fiscal 2024. In addition, other expense, net in fiscal 2025 includes a non-cash write-off of $1.2 million of unamortized debt issuance costs. Income tax expense (benefit) Income tax expense was $12.5 million in fiscal 2025, compared to income tax benefit of $4.8 million in fiscal 2024. The effective tax rate in fiscal 2025 differs from the U.S. federal statutory tax rate of 21% primarily due to an increase in a valuation allowance for deferred tax assets and an unfavorable impact from global intangible low-tax income, partially offset by a decrease in tax reserves. The effective tax rate in fiscal 2024 differs from the U.S. federal statutory tax rate of 21% primarily due to income derived from foreign operations with lower statutory tax rates and research deductions claimed in foreign jurisdictions, partially offset by non-deductible goodwill impairment, withholding taxes and global intangible low-tax income. Net loss Net loss was $62.6 million in fiscal 2025, compared to $123.3 million in fiscal 2024. The net loss was a result of the reasons described above. Operating Segments Automotive Fiscal Year Ended May 3, 2025 April 27, 2024 (in millions) (53 Weeks) (52 Weeks) Net sales North America $ 237.1 $ 265.6 Europe, the Middle East & Africa (“EMEA”) 239.5 216.2 Asia 32.3 116.4 Net sales 508.9 598.2 Gross profit $ 4.7 $ 30.4 As a percent of net sales 0.9 % 5.1 % Loss from operations $ (47.7 ) $ (140.2 ) As a percent of net sales (9.4 )% (23.4 )% 23 Table of Contents Net sales Automotive segment net sales decreased $89.3 million, or 14.9%, to $508.9 million in fiscal 2025, compared to $598.2 million in fiscal 2024. Excluding foreign currency translation, net sales decreased $88.9 million, or 14.8%. Net sales in North America decreased $28.5 million, or 10.7%, to $237.1 million in fiscal 2025, compared to $265.6 million in fiscal 2024. The decrease was due to the roll-off of legacy programs, partially offset by new program launches. Net sales in EMEA increased $23.3 million, or 10.8%, to $239.5 million in fiscal 2025, compared to $216.2 million in fiscal 2024. Excluding foreign currency translation, net sales in EMEA increased $23.5 million primarily due to new program launches, partially offset by lower sales volumes of sensor products. Net sales in Asia decreased $84.1 million, or 72.3%, to $32.3 million in fiscal 2025, compared to $116.4 million in fiscal 2024. Excluding foreign currency translation, net sales in Asia decreased $83.9 million primarily due to a program roll-off and lower sales volumes of lead frame products. Gross profit Automotive segment gross profit decreased $25.7 million, or 84.5%, to $4.7 million in fiscal 2025, compared to $30.4 million in fiscal 2024. Excluding the impact of foreign currency translation, gross profit decreased $25.0 million. Gross profit margins decreased to 0.9% in fiscal 2025, from 5.1% in fiscal 2024. The decrease in gross profit was due to lower sales volumes in North America and Asia, higher inventory obsolescence expense, higher salary expense and higher warranty expense, partially offset by lower freight costs. Loss from operations Automotive segment loss from operations was $47.7 million in fiscal 2025, compared to $140.2 million in fiscal 2024. Loss from operations in fiscal 2024 included goodwill impairment of $105.9 million. Excluding goodwill impairment and the impact of foreign currency translation, loss from operations increased $12.7 million. The increase was primarily due to lower gross profit, partially offset by lower selling and administrative expenses. Selling and administrative expenses decreased due to lower compensation expense, outbound freight and travel and entertainment expense. Industrial Fiscal Year Ended May 3, 2025 April 27, 2024 (in millions) (53 Weeks) (52 Weeks) Net sales $ 487.4 $ 460.1 Gross profit $ 144.2 $ 137.7 As a percent of net sales 29.6 % 29.9 % Income from operations $ 90.0 $ 88.8 As a percent of net sales 18.5 % 19.3 % Net sales Industrial segment net sales increased $27.3 million, or 5.9%, to $487.4 million in fiscal 2025, compared to $460.1 million in fiscal 2024. Excluding foreign currency translation, net sales increased $27.6 million, or 6.0%. The increase was due to higher sales volumes of power distribution products for data centers, partially offset by lower sales volumes for lighting products in the commercial vehicle and off-road equipment markets. Gross profit Industrial segment gross profit increased $6.5 million, or 4.7%, to $144.2 million in fiscal 2025, compared to $137.7 million in fiscal 2024. Excluding foreign currency translation, gross profit increased $6.8 million. Gross profit improved due to higher sales volumes and lower salary and freight expense. Gross profit margins slightly decreased to 29.6% in fiscal 2025, compared to 29.9% in fiscal 2024 due to product mix. Income from operations Industrial segment income from operations increased $1.2 million, or 1.4%, to $90.0 million in fiscal 2025, compared to $88.8 million in fiscal 2024. The increase was primarily due to higher gross profit, partially offset by higher selling and administrative expenses. The increase in selling and administrative expenses was primarily due to higher legal fees and compensation expense. 24 Table of Contents Interface Fiscal Year Ended May 3, 2025 April 27, 2024 (in millions) (53 Weeks) (52 Weeks) Net sales $ 51.8 $ 53.8 Gross profit $ 12.7 $ 10.3 As a percent of net sales 24.5 % 19.1 % Income from operations $ 10.3 $ 6.9 As a percent of net sales 19.9 % 12.8 % Net sales Interface segment net sales decreased $2.0 million, or 3.7%, to $51.8 million in fiscal 2025, compared to $53.8 million in fiscal 2024. The decrease was primarily due to lower sales volumes of transceivers for servers. Gross profit Interface segment gross profit increased $2.4 million, or 23.3%, to $12.7 million in fiscal 2025, compared to $10.3 million in fiscal 2024. Gross profit margin increased to 24.5% in fiscal 2025, from 19.1% in fiscal 2024. The improvement was primarily due to higher gross margins from touch panels for appliances. Income from operations Interface segment income from operations increased $3.4 million, or 49.3%, to $10.3 million in fiscal 2025, compared to $6.9 million in fiscal 2024. The increase was due to higher gross profit and lower selling and administrative expenses, primarily salary expense. Medical Fiscal Year Ended May 3, 2025 April 27, 2024 (in millions) (53 Weeks) (52 Weeks) Net sales $ — $ 2.4 Gross profit $ — $ (0.2 ) Loss from operations $ — $ (3.0 ) In the first quarter of fiscal 2024, we made the decision to initiate the discontinuation of the Dabir Surfaces business (which accounts for all of the Medical segment’s financial results). Towards the end of the second quarter of fiscal 2024, we sold certain assets of the Dabir Surfaces business and have now exited this business, which accounts for the variances in the table above. Financial Condition, Liquidity and Capital Resources Our liquidity requirements are primarily to fund our business operations, including capital expenditures and working capital requirements, as well as to fund debt service requirements, dividends and stock repurchases. Our primary sources of liquidity are cash flows from operations, existing cash balances and borrowings under our senior secured credit agreement. We believe our liquidity position will be sufficient to fund our existing operations and current commitments for at least the next twelve months. However, if economic conditions remain impacted for longer than we expect due to supply chain disruptions, inflationary pressure or other geopolitical risks, or if we are unable to maintain compliance with our debt covenants, our liquidity position could be severely impacted. At May 3, 2025, we had $103.6 million of cash and cash equivalents, of which $78.2 million was held in subsidiaries outside the U.S. Cash held by these subsidiaries is used to fund operational activities and can be repatriated, primarily through the payment of dividends and the repayment of intercompany loans, without creating material additional income tax expense. Repurchases of Common Stock On March 31, 2021, as subsequently amended on June 16, 2022, the Board of Directors authorized the purchase of up to $200.0 million of our outstanding common stock through June 14, 2024 (the “2021 Buyback Authorization”). On June 13, 2024, the Board of Directors authorized a new share buyback authorization, commencing on June 17, 2024, for the purchase of up to $200.0 million (the “2024 Buyback Authorization”) of our outstanding common stock through June 17, 2026. Purchases may be made on the open market, in private transactions or pursuant to purchase plans designed to comply with Rule 10b5-1 of the Securities Exchange Act of 1934. As of May 3, 2025, a total of 3,553,961 shares had been purchased under the 2021 Buyback Authorization at a total cost of $134.6 million since the commencement of that authorization. As of May 3, 2025, $200.0 million remained available under the 2024 Buyback Authorization to repurchase shares. Upon adoption of the 2024 Buyback Authorization, no further repurchases can be made under the 2021 Buyback Authorization. 25 Table of Contents Amended Credit Agreement On October 31, 2022, we entered into a Second Amended and Restated Credit Agreement (the “Credit Agreement”) with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and the Lenders and other parties named therein. On March 6, 2024, we entered into a First Amendment to Second Amended and Restated Credit Agreement (the “First Amendment”) and on July 9, 2024, we entered into a Second Amendment to Second Amended and Restated Credit Agreement and First Amendment to Second Amended and Restated Guaranty (the “Second Amendment”) with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, the other Lenders party thereto and other parties thereto. Among other things, the Second Amendment (i) reduced the revolving credit commitments from $750 million to $500 million (which commitments were subsequently further reduced, as discussed below), (ii) granted a security interest in substantially all of the personal property of the Company and its U.S. subsidiaries that are guarantors, including 100% of the equity interests of their respective U.S. subsidiaries and 65% of the equity interests of their respective foreign subsidiaries (or such greater amount to the extent such pledge could not reasonably cause adverse tax consequences), (iii) amended the consolidated interest coverage ratio covenant for each quarter in fiscal 2025 to relax that covenant to some extent for each of those quarters, (iv) amended the consolidated leverage ratio covenant for the quarter ending July 27, 2024 and each subsequent fiscal quarter to relax that covenant to some extent for each of those quarters, (v) amended certain interest rate provisions, (vi) added a requirement to provide monthly financial statements to the lenders through the period ending August 2, 2025, (vii) decreased the general basket exceptions to certain covenants restricting certain investments by, liens on and indebtedness of the Company and its subsidiaries for specified periods of time, (viii) increased, for fiscal 2025, the general basket exception to a covenant restricting certain dispositions of property by the Company and its subsidiaries, (ix) added an “anti-cash hoarding” requirement, applicable during the period from the effective date of the Second Amendment until the earlier to occur of (a) the delivery of financial statements and a compliance certificate for the fiscal quarter ending August 2, 2025 and (b) the delivery of compliance certificates for two consecutive fiscal quarters demonstrating that the our consolidated leverage ratio as of the last day of such fiscal quarters was less than 3.00:1.00, that if we have cash on hand in the U.S. (subject to certain exceptions) of more than $65 million for 10 consecutive business days, we shall prepay the indebtedness under the credit facility by the amount of such excess and (x) made certain other changes to the investment, restricted payment and indebtedness baskets. As of May 3, 2025, we were not in compliance with the consolidated leverage ratio and interest coverage ratio covenants contained in the Credit Agreement (as amended by the First Amendment and Second Amendment) for the quarter ended May 3, 2025. On July 7, 2025, we entered into a Third Amendment to Second Amended and Restated Credit Agreement (the “Third Amendment”) with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, the other Lenders party thereto and other parties thereto. Among other things, the Third Amendment (i) reduced the revolving credit commitments from $500 million to $400 million, (ii) eliminated our option to increase the revolving credit commitments and/or add one or more tranches of term loans under the credit facility from time to time subject to certain limitations and conditions including approval of certain lenders, (iii) amended the consolidated interest coverage ratio covenant for the quarters ending August 2, 2025, November 1, 2025, January 31, 2026 and May 2, 2026 to relax that covenant to some extent for each of those quarters, (iv) amended the consolidated leverage ratio covenant for the quarters ending August 2, 2025, November 1, 2025, January 31, 2026, May 2, 2026 and August 1, 2026 to relax that covenant to some extent for each of those quarters, (v) amended the definition of “Consolidated EBITDA,” to include an add back for a portion of the inventory write-down taken in the fourth quarter of fiscal 2025, (vi) increased the interest rate during the period from July 7, 2025 to the date that financial statements and a compliance certificate are delivered for the fiscal quarter ending October 31, 2026 (such period, the “Third Amendment Period”), (vii) changed the commitment fee payment during the Third Amendment Period, (viii) extended, through the maturity date, the requirement to provide monthly financial statements to the lenders, (ix) restricted or decreased, during the Third Amendment Period, the amount of certain exceptions to covenants restricting liens on, investments by and indebtedness of the Company and its subsidiaries, (x) limited to $2.5 million, in any fiscal quarter during the Third Amendment Period, the general basket exception to a covenant restricting certain restricted payments (including dividends) by the Company and its subsidiaries, while allowing under that general basket exceptions up to an aggregate of $25 million of restricted payments during any other period, (xi) extended, through the maturity date, the “anti-cash hoarding” requirement (described above), (xii) eliminated, during the Third Amendment Period, the investment, restricted payment and indebtedness baskets that had allowed for unlimited investments, restricted payments and indebtedness, as applicable, so long as (among other requirements) we met certain pro forma consolidated leverage ratio tests and (xiii) waived any default or event of default that may have occurred due to non-compliance with the consolidated interest coverage ratio covenant and the consolidated leverage ratio covenant for the quarter ended May 3, 2025 as calculated using the definition of “Consolidated EBITDA” that was in effect before giving effect to the Third Amendment. Following the effectiveness of the Third Amendment, we were in compliance with our consolidated interest coverage ratio covenant and our consolidated leverage ratio covenant for the quarter ended May 3, 2025. The Credit Agreement, as amended by the First Amendment, the Second Amendment and the Third Amendment is referred to herein as the “Amended Credit Agreement.” The Amended Credit Agreement provides for a secured multicurrency revolving credit facility of $400 million. The Amended Credit Agreement matures on October 31, 2027. 26 Table of Contents As of May 3, 2025, the outstanding balance under the revolving credit facility was $319.4 million, which included $226.4 million (€200.3 million) of euro-denominated borrowings and $93.0 million of U.S. dollar denominated borrowings. The Amended Credit Agreement contains various representations and warranties, financial covenants (including covenants requiring us to maintain compliance with a minimum consolidated interest coverage ratio and a maximum consolidated leverage ratio, in each case as of the end of each fiscal quarter of the Company), restrictive and other covenants, and events of default. The covenants in the Amended Credit Agreement include an “anti-cash hoarding” requirement, as discussed above. For further information about the Amended Credit Agreement, see Note 10, “Debt” to the consolidated financial statements included in this Annual Report. As of May 3, 2025, after giving effect to the Third Amendment, we were in compliance with all the covenants in the Amended Credit Agreement. Although we currently anticipate, based on our current projections and analyses, that we will be in compliance with the amended financial covenants contained in the Amended Credit Agreement, no assurance can be given that we will be and remain in compliance with such covenants in the future. Factors that could increase our risk of future non-compliance include those identified in Item 1A, “Risk Factors” of this Annual Report. Cash Flows Fiscal Year Ended May 3, 2025 April 27, 2024 (in millions) (53 Weeks) (52 Weeks) Operating activities: Net loss $ (62.6 ) $ (123.3 ) Non-cash items 85.3 157.4 Changes in operating assets and liabilities 3.7 13.4 Net cash provided by operating activities 26.4 47.5 Net cash used in investing activities (32.9 ) (17.5 ) Net cash used in financing activities (58.9 ) (18.9 ) Effect of foreign currency exchange rate changes on cash and cash equivalents 7.5 (6.6 ) (Decrease) increase in cash and cash equivalents (57.9 ) 4.5 Cash and cash equivalents at beginning of the period 161.5 157.0 Cash and cash equivalents at end of the period $ 103.6 $ 161.5 Operating activities Net cash provided by operating activities decreased $21.1 million to $26.4 million in fiscal 2025, compared to $47.5 million in fiscal 2024. The decrease was due to lower cash inflows related to changes in operating assets and liabilities and lower net income adjusted for non-cash items. The $3.7 million of cash inflows for operating assets and liabilities in fiscal 2025 was primarily due to lower accounts receivable, partially offset by higher inventory. Investing activities Net cash used in investing activities was $32.9 million in fiscal 2025, compared to $17.5 million in fiscal 2024. Capital expenditures in fiscal 2025 were $41.6 million, compared to $50.2 million in fiscal 2024. We received $5.6 million of cash from the sale of assets in fiscal 2025 compared to $21.3 million in fiscal 2024. In fiscal 2025, we received proceeds of $3.1 million from the settlement of a net investment hedge, compared to $0.6 million fiscal 2024. In fiscal 2024, we redeemed life insurance policies and received cash proceeds of $10.8 million. Financing activities Net cash used in financing activities was $58.9 million in fiscal 2025, compared to $18.9 million in fiscal 2024. We paid cash dividends of $20.4 million in fiscal 2025, compared to $19.9 million in fiscal 2024. In fiscal 2025, we had net repayments of borrowings of $30.6 million, compared to net proceeds from borrowings of $30.7 million in fiscal 2024. In fiscal 2025, we paid $1.8 million of debt issuance costs, compared to $1.1 million in fiscal 2024. In fiscal 2024, we paid $10.9 million to redeem a noncontrolling interest. In fiscal 2025, we paid $1.6 million of cash for share repurchases, compared to $13.7 million in fiscal 2024. 27 Table of Contents Contractual Obligations The following table summarizes our significant known contractual cash obligations and commercial commitments as of May 3, 2025: Payments Due By Period (in millions) Total Less than 1 year 1-3 years 3-5 years More than 5 years Finance leases $ 0.5 $ 0.2 $ 0.3 $ — $ — Operating leases 28.6 8.3 13.1 4.2 3.0 Debt (1) 320.7 0.2 319.8 0.4 0.3 Estimated interest on debt (2) 51.9 20.8 20.9 10.2 — Deferred compensation 9.4 1.5 1.9 0.9 5.1 Total $ 411.1 $ 31.0 $ 356.0 $ 15.7 $ 8.4 (1) Assumes the outstanding borrowings under the revolving credit facility will be repaid upon maturity of the credit agreement in October 2027. (2) Based on interest rates in effect as of May 3, 2025 (including the impact of interest rate swaps). Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements as defined under SEC rules. Critical Accounting Policies and Estimates The preparation of financial statements in conformity with GAAP requires that we make estimates and assumptions that can affect amounts reported in the consolidated financial statements. In preparing our consolidated financial statements, we have made our best estimates and judgments of certain amounts included in the consolidated financial statements. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable. To the extent that there are differences between these estimates and actual results, our consolidated financial statements may be materially affected. We believe that of the significant accounting policies described in Note 1, “Description of Business and Summary of Significant Accounting Policies” to the consolidated financial statements in this Annual Report, the following involve a significant level of estimation uncertainty. Goodwill. As described in Note 1 to the consolidated financial statements in this Annual Report, goodwill is tested for impairment on at least an annual basis, or more frequently if a triggering event indicates that an impairment may exist. The assessment of impairment may first consider qualitative factors including, but not limited to, the results of prior quantitative tests performed, changes in the carrying amount of the reporting unit, recent and projected financial performance, and macroeconomic and industry conditions. We consider the qualitative factors and weight of the evidence obtained to determine if it is more likely than not that a reporting unit’s fair value is less than the carrying amount. For the quantitative assessment, we utilize either, or a combination of, the income approach and market approach to estimate the fair value of the reporting unit. The income approach uses a discounted cash flow method and the market approach uses valuation multiples observed for the reporting unit’s guideline public companies. The determination of discounted cash flows is based on management’s estimates of revenue growth rates and earnings before interest, taxes, depreciation and amortization (“EBITDA”) margin, taking into consideration business and market conditions for the countries and markets in which the reporting unit operates. We calculate the discount rate based on a market-participant, risk-adjusted weighted average cost of capital, which considers industry specific rates of return on debt and equity capital for a target industry capital structure, adjusted for risks associated with business size, geography and other factors specific to the reporting unit. Revenue growth rates and EBITDA margin, especially in the outer years of a forecast, involve a greater degree of uncertainty. Further, a future change in the discount rate, as a result of a change in economic conditions or otherwise, could result in the carrying values of the reporting units exceeding their respective fair values. At the beginning of the fourth quarter of fiscal 2025, we performed a quantitative goodwill impairment analysis for our Grakon Industrial and Nordic Lights reporting units. Based on this analysis, we determined that the fair value of both of these reporting units was in excess of its carrying value. However, as noted in Note 7 to the consolidated financial statements in this Annual Report, the fair value of the Nordic Lights reporting unit exceeded its carrying value by less than 10%. We performed a sensitivity analysis for the significant assumptions used in the goodwill impairment testing analysis for the Nordic Lights reporting unit as follows: • A hypothetical increase in the discount rate of 100 basis points would result in goodwill impairment of approximately $7.3 million; • A hypothetical decrease in revenues of approximately 6% from fiscal 2026 to fiscal 2028 would result in goodwill impairment of approximately $5.3 million; and • A hypothetical decrease of forecasted EBITDA margins of 100 basis points over the entire forecast period would result in goodwill impairment of approximately $3.3 million. 28 Table of Contents The sensitivities above were calculated in isolation using the income approach and keeping all other assumptions constant. The cash flow sensitivities do not consider the offsetting impact of a lower discount rate assumption to reflect the reduced risk in estimated future cash flow growth used under the income approach or the related impacts on pricing multiples used under the market approach. Impairment of long-lived assets. We evaluate whether events and circumstances have occurred which indicate that the remaining estimated useful lives of our intangible assets, excluding goodwill, and other long-lived assets, may warrant revision or that the remaining balance of such assets may not be recoverable. Determination of recoverability of long-lived assets is based on the lowest level of identifiable estimated future undiscounted cash flows resulting from the use of the asset and its eventual disposition. Measurement of any impairment loss is based on the excess of the carrying value of the asset group over its fair value. Assumptions and estimates about future values and the remaining useful lives are complex and subjective. They can be affected by a variety of factors, including external factors such as industry and economic trends, and internal factors such as changes in our business strategy and our internal forecasts. Income taxes. We are subject to income taxes in the U.S. and numerous foreign jurisdictions. In calculating our effective income tax rate, we make judgments regarding certain tax positions, including the timing and amount of deductions and allocations of income among various tax jurisdictions. When determining whether we will be able to realize deferred tax assets, judgment is used to evaluate the positive and negative evidence, including forecasting taxable income using historical and future operating results. The amount of income taxes we pay is subject to ongoing audits by federal, state and foreign tax authorities. Our estimate of the potential outcome of any uncertain tax issue is subject to management’s assessment of relevant risks, facts, and circumstances existing at that time. We use a more-likely-than-not threshold for financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. We record a liability for the difference between the benefit recognized and measured and tax position taken or expected to be taken on our tax return. To the extent that our assessment of such tax positions changes, the change in estimate is recorded in the period in which the determination is made. We record a valuation allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized. We evaluate our ability to realize the tax benefits associated with deferred tax assets by assessing the adequacy of future expected taxable income, including the reversal of existing temporary differences, historical and projected operating results, and the availability of prudent and feasible tax planning strategies. As of May 3, 2025, we had a valuation allowance of $20.7 million. In the event our operating performance improves or deteriorates in a filing jurisdiction or entity, future assessments could conclude a smaller or larger valuation allowance will be needed. Due to the complexity of some of these uncertainties, the ultimate resolution may be materially different from the current estimate. Some or all of management’s judgments are subject to review by the taxing authorities. If one or more of the taxing authorities were to successfully challenge our right to realize some or all of the tax benefit we have recorded, and we were unable to realize this benefit, it could have a material adverse effect on our financial results and cash flows. Further, if we are unable to generate sufficient future taxable income, there is a material change in the actual effective tax rates, a change to the time period within which the underlying temporary differences become taxable or deductible, or if the tax laws change unfavorably, then we could be required to increase the valuation allowance against deferred tax assets, resulting in an increase in income tax expense and the effective tax rate. New Accounting Pronouncements For more information regarding new applicable accounting pronouncements, see Note 1, “Description of Business and Summary of Significant Accounting Policies” to the consolidated financial statements included in this Annual Report.