Idexx Laboratories Inc: Form 10-K for the period ended Dec 31, 2025

COMPANY OVERVIEW

IDEXX was incorporated in Delaware in 1983. We develop, manufacture, and distribute products and provide services primarily for the companion animal veterinary; livestock, poultry and dairy; and water testing industries. We also manufacture and sell human medical point-of-care diagnostic products. Our primary products and services are:

• Point-of-care veterinary diagnostic products, comprised of instruments, consumables, and rapid assay test kits;
• Veterinary reference laboratory diagnostic and consulting services;
• Practice management systems, software and diagnostic imaging systems and services used by veterinarians;
• Health monitoring, biological materials testing, laboratory diagnostic instruments, and services used by the biomedical research community;
• Diagnostic and health-monitoring products for livestock, poultry, and dairy; and
• Products that test water for certain microbiological contaminants.

Our Purpose is to be a great company that creates exceptional long-term value for our customers, employees, and stockholders by enhancing the health and well-being of pets, people, and livestock.

DESCRIPTION OF BUSINESS BY SEGMENT

We operate primarily through three reportable business segments: Companion Animal Group, Water quality products, and Livestock, Poultry and Dairy. Our Other operating segment combines and presents our human medical diagnostic products business with our out-licensing arrangement because they do not meet the quantitative or qualitative thresholds for reportable segments.

Companion Animal Group (“CAG”) - Diagnostic and information management products and services for the companion animal veterinary industry, including point-of-care diagnostic solutions, outside reference laboratory services, and veterinary software and services.

CAG Diagnostics

We provide diagnostic capabilities that meet veterinarians’ diverse needs through a variety of modalities, including point-of-care diagnostic solutions and outside reference laboratory services. Regardless of modality utilized, veterinarians are provided with clinically relevant data which is integrated within our information management technologies. The result is a comprehensive view of patient diagnostic information that is easily accessible by both the veterinarian and pet owner.

Point-of-Care Diagnostic Solutions. Our point-of-care diagnostic solutions are comprised of our IDEXX VetLab suite of point-of-care chemistry, hematology, immunoassay, electrolyte, urinalysis, cytology/morphology, blood gas, and coagulation analyzers, as well as associated consumable products that provide real-time reference lab quality diagnostic results. Several of these point-of-care analyzers, including the Catalyst One Chemistry analyzer, ProCyte One hematology analyzer, SediVue Dx Analyzer, and IDEXX inVue Dx Cellular Analyzer, utilize proprietary AI capabilities in their image capture systems to analyze samples. IDEXX point-of-care analyzers feature load-and-go sample handling and integration with a cloud-enabled software ecosystem, including the IDEXX VetLab Station and VetConnect PLUS. Our point-of-care diagnostic solutions also include a broad range of single-use, IDEXX SNAP rapid assay test kits that provide quick, accurate, and convenient point-of-care diagnostic test results for a variety of companion animal disease-causing pathogens and health conditions. Additionally, we offer extended maintenance agreements in connection with the sale of our instruments.

Blood and Urine Chemistry. Our blood and urine chemistry analyzers are used by veterinarians to measure levels of certain enzymes and other substances in blood or urine for monitoring health status and assisting in diagnosing physiologic conditions. We actively sell the Catalyst One Chemistry Analyzer and continue to support the Catalyst Dx Analyzer, both of which perform chemistry, immunoassay, and electrolyte tests. We also support the

VetStat Electrolyte and Blood Gas Analyzer. Sales of consumables to customers who use our chemistry analyzers provide the majority of our instrument consumables revenues from our installed base of IDEXX VetLab instruments.

Hematology. Our hematology analyzers assess the cellular components of blood, including red blood cells, white blood cells, and platelets (also called a complete blood count). These analyzers include the ProCyte One and ProCyte Dx hematology analyzers. We also sell the Coag Dx Analyzer, which permits the detection and diagnosis of blood clotting disorders.

Urinalysis. The SediVue Dx Analyzer provides a complete urine sediment analysis. This platform features proprietary AI capabilities. The IDEXX VetLab UA Analyzer provides rapid, automated capture of semi-quantitative chemical urinalysis from IDEXX UA strips and is validated specifically for veterinary use.

Cytology / Morphology. Beginning in late 2024 we launched our point-of-care cellular analyzer, IDEXX inVue Dx, which automates real-time cytology and blood cell morphology testing. The IDEXX inVue Dx Cellular Analyzer uses advanced optics and AI technology in a slide-free, load-and-go platform.

Rapid Assay. The SNAP rapid assays are single-use, handheld test kits that can work without the use of instrumentation, although many kits may also be activated with results automatically captured and interpreted by the SNAP Pro Analyzer. This device improves medical care by allowing veterinarians to share the test results with the pet owner on the SNAP Pro Analyzer screen, or via VetConnect PLUS. The principal canine SNAP rapid assay tests include SNAP 4Dx Plus, which tests for the seven vector-borne diseases causing pathogens, including Lyme disease as well as canine heartworm, and SNAP Heartworm RT, which tests for heartworm. Sales of our canine vector-borne disease tests are typically greater in the first half of our fiscal year due to seasonality of disease testing in the veterinary practices in the Northern Hemisphere. The principal feline SNAP rapid assay tests include SNAP Feline Triple, which tests for feline immunodeficiency virus (“FIV”), feline leukemia virus (“FeLV”) and heartworm, and SNAP FIV/FeLV Combo Test, which tests for FIV and FeLV.

IDEXX VetLab Station. The IDEXX VetLab Station (“IVLS”) connects and integrates the diagnostic information from all the IDEXX VetLab analyzers. IVLS also sends all results created on connected instruments automatically to VetConnect PLUS. We sell IVLS as an integral component for our point-of-care analyzer suite.

Integrated Diagnostic Information Management. VetConnect PLUS is a cloud-based technology that enables veterinarians to access and analyze patients’ data from all of IDEXX’s diagnostic modalities. These integrated diagnostic results provide the veterinarian with a visualization of patient-specific information, allowing the veterinarian to easily see and trend diagnostic results. VetConnect PLUS enables greater medical insight and enhanced decision-making through IDEXX DecisionIQ, an analytical tool incorporated in VetConnect PLUS that utilizes proprietary technology, including AI, to aid practitioners in making medical diagnoses. In addition, VetConnect PLUS provides instant mobile and browser-based access to results, which can be shared with pet owners and other veterinarians directly from the VetConnect PLUS application.

Reference Laboratory Diagnostic and Consulting Services. We offer commercial reference laboratory diagnostic and consulting services to veterinarians in many developed geographies worldwide, including customers in the U.S., Europe, Canada, Australia, Japan, New Zealand, South Africa, and South Korea, through a network of approximately 80 laboratories. Customers use our services by submitting samples by courier or overnight delivery to one of our facilities. Most test results have same-day or next-day turnaround times. Our diagnostic laboratory business also provides health monitoring and diagnostic testing services to biomedical research customers in North America, Europe, and Asia.

Our reference laboratories offer a large selection of tests and diagnostic panels to detect a number of disease states and other conditions in animals, including all tests that can be run in the clinic at the veterinary practice with our instruments or rapid assays. This menu of tests also includes a number of specialized tests that we have developed that allow practitioners to diagnose relevant diseases and conditions in dogs and cats, including parasites, heart disease, allergies, pancreatitis, diabetes, renal disease, and infectious diseases. We also offer cancer screening to aid in diagnosis, assist in therapy selection, and support therapy management and monitoring. During 2025, we launched the IDEXX Cancer Dx Panel in North America, which is a simple blood test for dogs that screens for lymphoma, and will expand the IDEXX Cancer Dx Panel to include canine mast cell tumor detection in North America in 2026. We currently anticipate launching the IDEXX Cancer Dx test for canine lymphoma internationally in the first half of 2026.

IDEXX Telemedicine. We provide specialized veterinary consultation, telemedicine, and advisory services, including radiology, dental radiography, cardiology, internal medicine, and ultrasound consulting. These services enable veterinarians to obtain diagnostic interpretations, and radiology and cardiology assessments. IDEXX Telemedicine services are accessed through IDEXX Web PACS, ezyVet, and VetMedStat, a cloud-based software platform for case submission and interpretation that embeds proprietary AI capabilities aiding analysis of images and electrocardiogram results.

Veterinary Software and Services & Diagnostic Imaging Systems

Veterinary Software and Services. We develop, market, and sell a portfolio of software and services for independent veterinary clinics and corporate groups.

Practice management systems. We provide software, hardware, and integrated services that run key functions of veterinary clinics, including managing patient electronic health records, scheduling, client communication, billing, and inventory management. Our practice management system offerings include cloud-based ezyVet, Animana, and IDEXX Neo, and on-premises Cornerstone. To support the software system needs of practices, IDEXX provides integrated services, including payment solutions, data backup & recovery, and practice supplies.

Third-party integrations strengthen our practice management systems value proposition by improving user workflows and can quickly add new functionality to the practice management systems. Our commercial application programming interfaces and processes allow access to the practice management systems platform while providing an enhanced user experience. Our large practice management systems installed base provides access to veterinary channel transaction activity, enabling a syndicated data offering. Industry pharmaceutical and nutrition partners leverage our data to understand channel market performance and to provide behavioral insights.

Software applications that extend workflow capabilities for practices and groups. We are able to improve overall patient management and workflow optimization through coordination and tracking of every step of a patient during a hospital stay. Our SmartFlow cloud offering works in conjunction with major veterinary practice management systems, including ezyVet, Cornerstone, Animana, IDEXX Neo, and certain third-party practice management systems, and VetRadar provides workflow capability for ezyVet.

Client marketing and wellness plan management. In addition, we offer cloud-based client communication (Vello and Pet Health Network Pro) and preventive care plan management software (Petly Plans) designed to strengthen the relationship between the veterinarian and the pet owner. To support the communication needs between general practices and specialty referral practices, IDEXX offers rVetLink software. Lastly, IDEXX Enterprise provides centralized management and reporting capabilities for groups of veterinary practices.

Diagnostic Imaging Systems. Diagnostic x-rays support a broad array of diagnostic use cases, from trauma to chronic disease detection, providing critical insights that support further diagnostic testing and treatment plans. We market and sell two diagnostic imaging systems primarily used in small animal veterinary applications: IDEXX ImageVue DR50 and IDEXX ImageVue DR30. The IDEXX ImageVue DR50 Plus, which launched in North America in January 2026, combines high definition, AI-powered imaging with a lower dose of radiation compared to our current ImageVue DR50 system.

Our diagnostic imaging systems employ picture archiving and communication system (“PACS”) software called IDEXX Web PACS, which facilitates radiographic image capture and review. IDEXX Web PACS is our cloud-based software-as-a-service (“SaaS”) for all imaging modalities, including digital radiology (x-ray), ultrasound, dental radiology, CT, and MRI. IDEXX Web PACS enables practice workflows across all imaging modalities, including advanced image analysis, image sharing, and storage. IDEXX Web PACS is integrated with Cornerstone, ezyVet, IDEXX Neo, and IDEXX VetConnect PLUS to provide centralized access to diagnostic imaging results alongside patient diagnostic results from any internet-connected device. IDEXX Web PACS uses proprietary AI capabilities to enable optimal sharing, analysis, and storage of diagnostic images.

We believe that the breadth of our full diagnostic solution, including novel products and services developed and made available only by IDEXX, as well as the software integration of our offering, provide a differentiated competitive advantage by giving veterinarians the tools and services to offer advanced veterinary medical care. We believe that with the use of our products and services, veterinary practices significantly improve the quality of veterinary care provided to their patients, increase staff efficiencies, and better communicate the value of this medical care to the pet owner. We believe that these capabilities, enabled by the use of IDEXX products and services, improve the effectiveness and financial health of the veterinary practice.

Water quality products (“Water”) - Water provides innovative testing solutions and related instrumentation for easy, rapid, and accurate detection and quantification of various microbiological parameters in water.

Water testing. Our principal products are the Colilert, Colilert-18, and Colisure tests, which detect the presence of total coliforms and E. coli in water. These organisms are broadly used as microbial indicators for potential fecal contamination in water. Our products utilize nutrient-indicators that produce a change in color or fluorescence when metabolized by target microbes in the sample. Our water tests are used by government laboratories, water utilities, and private certified laboratories to test drinking water in compliance with regulatory standards, including U.S. Environmental Protection Agency (“EPA”) standards. The tests also are used in evaluating water used in production processes (for example, in beverage and pharmaceutical applications) and in evaluating bottled water, recreational water, wastewater, and water from private wells. We also sell consumables, parts, and accessories to be used with many of our water testing products. IDEXX also offers the following products:

Enterolert. Our Enterolert products detect the presence of enterococci in drinking, waste, and recreational waters. Enterococci, bacteria normally found in human and animal waste, are organisms broadly used as microbial indicators for potential fecal contamination in water.

Pseudalert. Our Pseudalert products detect the presence of Pseudomonas aeruginosa in pool, spa, and bottled water. Pseudomonas aeruginosa is a pathogen that can cause “hot-tub rash,” “swimmer’s ear,” and potentially fatal infections in individuals with weakened immune systems.

Filta-Max and Filta-Max xpress. Our Filta-Max and Filta-Max xpress products are used in the detection of Cryptosporidium and Giardia in water. Cryptosporidium and Giardia are parasites that can cause potentially fatal gastrointestinal illness if ingested. We also distribute certain water testing kits manufactured by Thermo Fisher Scientific, Inc. that complement our Cryptosporidium and Giardia testing products.

Legiolert. Our Legiolert product is a simple culture method test for the detection of Legionella pneumophila, the most common Legionella species in water and the primary cause of Legionnaires’ disease. The Legiolert test is designed to be used on potable or non-potable water sources with results in seven days.

Quanti-Tray products. Our Quanti-Tray products, when used in conjunction with our Colilert, Colilert-18, Colisure, Enterolert, Pseudalert, Heterotrophic Plate Count (“HPC”) or Legiolert products, provide users quantitative measurements of microbial contamination rather than a presence/absence indication. Our Quanti-Tray Sealer PLUS and Quanti-Tray Sealer 2X instruments are used with the Quanti-Tray products for the determination of bacterial density in water samples. Our SimPlate and EasyDisc for HPC products detect the total number of the most common bacteria in a water sample.

IDEXX Tecta Systems. Our IDEXX Tecta system instruments automate several steps in water testing workflows, allowing multiple samples to be tested simultaneously, with remote notification capability. Tecta detects total coliforms and E. coli, E. coli only, fecal coliforms, and enterococci.

UV Viewer Plus. Launched in 2025, our UV Viewer Plus is a bench-top UV light cabinet designed to provide controlled illumination to aid in the visual interpretation of fluorescent-based water tests.

Livestock, Poultry and Dairy (“LPD”) - LPD provides diagnostic tests, services, and related instrumentation that are used to manage the health status of livestock and poultry, to improve producer efficiency, and to measure the quality and safety of milk.

Livestock, Poultry, Herd Health Screening and Production Management. Our livestock and poultry diagnostic products are purchased by government and private laboratories that provide testing services to livestock veterinarians, producers, and processors, and also directly by livestock veterinarians and producers. Our principal livestock and poultry diagnostic products include tests for Bovine Viral Diarrhea Virus (“BVDV”), Porcine Reproductive and Respiratory Syndrome (“PRRS”), and Transmittable Spongiform Encephalopathies (“TSE”). BVDV is a common and contagious viral infection that suppresses the immune system, making the animal susceptible to a host of other infections, and impacting beef and dairy production yields as a result. PRRS is a contagious virus causing reproductive problems and respiratory diseases in swine, leading to increased piglet mortality, reduced growth, and vulnerability to secondary infections. TSE is a transmissible disease in which infected animals exhibit behavioral disturbances and a progressive loss of physical condition that precedes death. We also sell our Alertys Milk Pregnancy Test, Alertys Ruminant Pregnancy Test, Alertys On-Farm Pregnancy Test, and Rapid Visual Pregnancy Test for cattle and other ruminants, which can detect pregnancy 28 days after breeding using milk, serum, or whole blood samples. Additionally, we offer herd health screening services to livestock veterinarians and producers.

Dairy products. Our principal dairy products use our SNAP test platform and are used by dairy producers and processors worldwide to detect antibiotic drug residue in milk. Our primary product lines are SNAP Beta-Lactam ST and SNAPduo ST Plus, which detect certain beta-lactam and tetracycline antibiotic residues.

Other - Our human medical diagnostic business, which does not meet the quantitative or qualitative thresholds for reportable segments, and is presented within Other. We sell point-of-care analyzers and related consumables for use in human medical hospitals and clinics to measure electrolytes, blood gases, acid-base balance, glucose, lactate, blood urea nitrogen and ionized calcium, and to calculate other parameters such as base excess and anion gap.

Additional information about our products and services can be found on our website. Information contained on or connected to our website is not incorporated by reference into this Annual Report on Form 10-K and should not be considered part of this Annual Report on Form 10-K or any other filing we make with the SEC.

MARKETING AND DISTRIBUTION

We market, sell, and service our products worldwide through our marketing, customer service, sales, and technical service groups, as well as through independent distributors and other resellers. We maintain a sales presence in the U.S. and in major regions worldwide, including Africa, Asia Pacific, Canada, Europe, and Latin America.

Generally, we select the appropriate distribution channel for our products based on the type of product, technical service requirements, number and concentration of customers, regulatory requirements, and other factors. We market our companion animal diagnostic products to veterinarians directly in the U.S. Outside the U.S., we sell our companion animal diagnostic products through our direct sales force and, in certain countries, through distributors and other resellers. We sell our veterinary reference laboratory diagnostic and consulting services worldwide, generally through our direct sales force. We market our diagnostic imaging products primarily through our direct sales force in the U.S. We market our software products primarily through our direct sales force in the U.S., Canada, Europe, and Australia. We market our Water and LPD products primarily through our direct sales force in the U.S. and Canada. Outside the U.S. and Canada, we market these products through our direct sales force and, in certain countries, through selected independent distributors.

RESEARCH AND DEVELOPMENT

Our business strategy includes the development and introduction of new products and services and may involve entry into new business areas. We maintain active research and development programs in each of our three primary business segments. Our research and development expenses, which consist of salaries, employee benefits, certain licensing agreements, materials and external consulting and development costs, were $251.2 million for the year ended December 31, 2025, or 5.8% of our consolidated revenue, $219.8 million for the year ended December 31, 2024, or 5.6% of our consolidated revenue, and $191.0 million for the year ended December 31, 2023, or 5.2% of our consolidated revenue.

INTELLECTUAL PROPERTY, INCLUDING PATENTS AND LICENSES

We actively seek to protect our intellectual property rights and the competitive position of our innovative offerings through various approaches, including the use of patents, copyrights, trademarks, and trade secrets. We file applications for and obtain patents, copyrights, and trademarks in the U.S. and other countries as we believe appropriate, and we seek to protect our trade secrets and proprietary know-how. We also license patents and technologies from third parties.

While we consider ownership of these intellectual property rights in the aggregate to be important to us, we do not believe that any single patent, copyright, trademark, trade secret, or license is material to our business as a whole, and we primarily rely on the innovative skills, technical expertise, customer focus and knowledge, and marketing abilities of our employees for our business success. In addition, a range of factors help to mitigate the future potential effects of the expiration of any of our patents, licenses, and other intellectual property rights on our results of operations and financial position. These factors include, but are not limited to:

• publications, including peer-reviewed third-party studies, that demonstrate the performance and benefits of our products and services;
• our brand strength and reputation in the marketplace;
• the breadth, quality and integration of our product and service offerings;
• our existing customer relationships and our customer service and support;
• our sales force;
• our online ordering platform that enables direct ordering of (including establishing automatic reorder schedules for) our consumables, tests and other products by our customers;
• the applicable regulatory approval status for certain products;
• our continued investments in innovative product and service improvements that result in new technologies, features, functionalities, enhancements, integrations, and any related patents or other intellectual property rights;
• our investment in diagnostic innovations that results in new product and service offerings that expand the test menu for our point-of-care instruments and/or reference laboratory business, and any related patents or other intellectual property rights; and
• our significant know-how, scale and investments related to the product design and manufacturing processes of associated product offerings and certain supply arrangements for consumables that are compatible with our instruments.

We own or have license rights to various patents, patent applications, and technologies in the U.S. and other countries. These patents, patent applications, and technologies relate to intellectual property embodied in certain of our CAG products and services (including our Catalyst instruments and consumables and certain reference laboratory tests), LPD diagnostic products, and Water testing products, as well as other technologies relevant to the manufacture and commercialization of these products and services. Although certain of these patents and licenses are expected to expire in future years, the expiration of these patents and licenses, individually or in the aggregate, is not expected to have a material effect on our financial position or future operations. We face robust competition as other companies have been successful in bringing competitive products and services to market, despite the protections afforded by these patent and license rights.

In addition to seeking patent protection as appropriate, we also protect certain intellectual property (such as software and our manufacturing know-how) through U.S. and international trade secret and copyright laws. We seek to protect our trade secrets and proprietary know-how in many ways, including through confidentiality and invention assignment agreements with our employees and third parties with which we do business (such as vendors, strategic partners, and consultants) and internal confidentiality processes and procedures.

To the extent some of our products and services may now, or in the future, embody technologies protected by patents, copyrights, or trade secrets of others, we may be required to obtain licenses to such technologies in order to continue to sell our products and services. These licenses may not be available on commercially reasonable terms or at all. Our failure to obtain any such licenses may delay or prevent the sale of certain new or existing products and services. Refer to “Part I, Item 1A. Risk Factors.”

PRODUCTION AND SUPPLY

Certain instruments that we sell are manufactured by third parties. We rely on third parties in our supply chain to supply us, and our direct suppliers, with certain important components, raw materials, and consumables used in or with our products and services. In some cases, these third parties are sole or single-source suppliers. We seek to mitigate sole and single-source supplier risks on a risk-prioritized basis and in a variety of ways, including, when possible, identifying and quantifying alternative suppliers, developing applicable in-house manufacturing capabilities and expertise, entering into escrow arrangements for manufacturing information for certain single or sole-sourced products, and strategically maintaining safety stock.

Instruments and consumables. Significant products, components, and raw materials supplied by sole and single-source providers include certain Catalyst Dx and Catalyst One consumables (other than electrolyte consumables and the fructosamine, thyroxine, canine C-reactive protein, progesterone, SDMA, and Pancreatic Lipase, Cortisol, and Bile Acid slides), ProCyte Dx Analyzers and consumables, IDEXX inVue Dx cytology consumables, SediVue Dx urinalysis instruments and consumables, and certain components of our internally manufactured analyzers.

Certain Catalyst chemistry slides are supplied by Ortho-Clinical Diagnostics, Inc. (“Ortho”) under supply agreements that are currently set to expire in December of 2044. The terms of the agreements allow for early termination in certain circumstances. In the event of a notice of non-extension, the agreements will continue for a period of twelve years through December 31 of the twelfth year after such notice, up to 2044. We are obligated to purchase all of our requirements for our current menu of Catalyst chemistry slides from Ortho to the extent Ortho is able to supply those requirements. The agreements provide for pricing based on purchase volumes and a fixed annual inflationary adjustment. The agreements also prohibit Ortho from promoting and selling these chemistry slides in the veterinary sector, excluding the EU, other than to IDEXX.

We purchase other analyzers and consumables under supply agreements with terms extending through 2034, which in some cases may be extended at our option. We have minimum purchase obligations under some of these agreements, and our failure to satisfy these obligations may result in the loss of some or all of our rights under these agreements. Refer to “Part I, Item 1A. Risk Factors.”

Other components. We purchase certain other products, raw materials, and components from sole and single-source suppliers. These products include certain diagnostic imaging systems and certain components used in our SNAP rapid assay and dairy devices, livestock and poultry testing kits, and water testing products.

We have been successful in ensuring an uninterrupted supply of products purchased from sole and single-source suppliers. However, there can be no assurance that uninterrupted supply can be maintained if these agreements terminate for any reason, or our suppliers otherwise are unable to satisfy our requirements for products. Refer to “Part I, Item 1A. Risk Factors.”

Product quality and safety. We believe that product quality and safety are essential to our business. We conduct our operations within an Integrated Management System, which encompasses our Quality Assurance program, to help ensure compliance with applicable regulations, product safety requirements and standards, and customer requirements. This Integrated Management System includes strict manufacturing processes and procedures, employee training, ongoing process improvement, product quality risk management procedures, incident investigation and corrective action procedures, and internal and third-party auditing. Our manufacturing and distribution facilities in Westbrook, Maine; Scarborough, Maine; Roswell, Georgia; Memphis, Tennessee; and the Netherlands, Switzerland, France, and the United Kingdom are certified to the ISO 9001 quality standard, and certain of our other facilities are certified to the environmental (ISO 14001) and testing and calibration laboratory (ISO 17025) quality standards. ISO quality standards are internationally recognized manufacturing standards established by the International Organization for Standardization, which are audited and certified by third-party auditors in addition to our internal self-audits. We also require our key suppliers to have quality management systems that comply with recognized industry standards, such as ISO 9001, and are aligned with our quality requirements, and we regularly conduct audits with our Tier 1 suppliers to verify control systems meet all our requirements. In addition, we make available instructions and other information to help ensure the proper and safe use of our products.

BACKLOG

We generally do not maintain a significant backlog of orders and believe that our backlog at any particular date historically has not been indicative of future sales.

COMPETITION

We compete with many companies ranging from large human and animal health pharmaceutical and medical diagnostics companies to small businesses focused on animal health. Our companion animal veterinary diagnostic products and services compete with both reference laboratory service and point-of-care product providers. Our competitors vary in our different business areas and regions. In some cases, academic institutions, governmental agencies, and other public and private research organizations conduct research activities and may commercialize products or services, which could compete with our products, on their own or through joint ventures. Some of our direct and potential competitors have substantially greater financial and managerial resources than us, as well as greater experience in manufacturing, marketing, research and development, and obtaining regulatory approvals than we do. For more information on risks related to our competition, refer to “Part I, Item 1A. Risk Factors."

Competitive factors in our different business areas are detailed below:

• Companion animal diagnostic offerings. We compete primarily on the basis of ease of use and speed of our products, diagnostic accuracy, product quality, breadth of our product line and services, differentiated product innovations, fully integrated technology, information management capability, enhancement of veterinary practice efficiency, availability of medical consultation, effectiveness of our sales and distribution channels, quality of our technical and customer service, and our pricing relative to the value of our products and services in comparison with competitive products and services. We compete with a number of companies in most geographic locations in North America including Mars, Incorporated brands Antech Diagnostics and Heska; and Zoetis Inc. (including its wholly-owned subsidiary Abaxis, Inc.). We also compete in certain international geographies with Zoetis Inc.; Mars, Incorporated brands including Heska, Antech Diagnostics, scil animal care, and Antech-Asia Veterinary Diagnostics; Fujifilm Holdings Corporation; Arkray, Inc.; Mindray; and BioNote, Inc.
• Water, livestock, poultry and dairy testing products. We compete primarily on the basis of the ease of use, speed, accuracy, product quality, and other performance characteristics of our products and services (including differentiated tests), the breadth of our product line and services, the effectiveness of our sales and distribution channels, the quality of our technical and customer service, our ability to receive regulatory approvals from governing agencies, and our pricing relative to the value of our products in comparison with competitive products and services. Our competitors include smaller regional companies and larger companies with livestock and poultry diagnostics and water testing solution products, such as Neogen Corporation, Charm Sciences, Inc., BioChek, Innovative Diagnostics and Thermo Fisher Scientific Inc.
• Veterinary Software, Services, and Diagnostic Imaging Systems. We compete primarily on the basis of functionality, system workflows, performance characteristics, effectiveness of our implementation, training process and customer service, information handling capabilities, advances in technologies, enhancement of veterinary practice efficiency, and our pricing relative to the value of our products and services in comparison with competitive products and services. We sell these products primarily in North America and Europe. Our largest competitor in North America and the U.K. is Covetrus, Inc., which offers several systems and leverages its animal health distribution business in sales and service. We also compete with numerous smaller companies throughout the geographies in which we offer veterinary software, including those offering cloud-based solutions. Our competitors in the diagnostic imaging systems sector include Sound-Eklin, Antech Diagnostics, FUJIFILM, and Heska.

GOVERNMENT REGULATION

Many of our products are subject to comprehensive regulation by U.S. and foreign regulatory agencies that relates to, among other things, product approvals, product registrations, manufacturing, import, export, distribution, marketing and promotion, labeling, recordkeeping, testing, quality, storage, product disposal, environmental compliance, and workplace safety. The following is a description of the principal regulations affecting our businesses.

Veterinary diagnostic products. Our veterinary diagnostic products, including instruments, such as Catalyst One and ProCyte One, as well as their corresponding consumables, are veterinary medical devices under the jurisdiction of the FDA under the Food, Drug and Cosmetics Act (the “FDC Act”). Other products under FDA jurisdiction include our rapid assay products such as SNAP devices and enzyme-linked immunosorbent assay plates. While the sale of these products does not require premarket approval by the FDA and does not subject us to FDA inspections or the FDA's current Good Manufacturing Practice regulations (“cGMP”), the FDC Act specifies that these products must not be adulterated, mislabeled, or misbranded.

A subset of our veterinary diagnostic products, including our diagnostic test kits for companion and food animal infectious diseases, as well as most of our livestock and poultry products and many of our rapid assay products, are licensed and regulated in the U.S. by the Center for Veterinary Biologics within the United States Department of Agriculture (“USDA”) Animal and Plant Health Inspection Service (“APHIS”). These products must be approved by APHIS before they may be sold in and from the U.S. The APHIS regulatory approval process involves the submission of product validation data, including manufacturing process and facility documentation. Following regulatory licensure to market a product, APHIS requires that each product serial be submitted for test review before release to customers. In addition, APHIS requires special approval to market products where test results are used for government-mandated disease management programs. A number of foreign governments accept APHIS approval to support product registration for sale, distribution, and use within their countries. However, compliance with extensive country-specific regulatory processes is required in connection with importing and marketing diagnostic products in Japan, Germany, Canada, Brazil, the Netherlands, China, and many other countries. We are also required to have a facility license from APHIS to manufacture USDA-licensed products. We have a facility license for our manufacturing facility in Westbrook, Maine which also covers our distribution center in Memphis, Tennessee. Our LPD manufacturing facility in Montpellier, France is a USDA-permitted site, and has been approved by APHIS to manufacture specified USDA-permitted products.

Water testing products. Our water tests are generally not subject to formal premarket regulatory approval. However, before a test can be used as part of a water quality monitoring program in the U.S. that is regulated by the EPA, the test method must first be approved by the EPA. The EPA approval process involves submission of extensive product performance data in accordance with an EPA-approved protocol, evaluation of the data by the EPA, and typically publication for public comment of any proposed approval in the Federal Register before final approval. Our Tecta Systems with the Tectalert EC/TC medium, Colilert, Colilert-18, Colisure, Quanti-Tray, Filta-Max xpress, Enterolert, and SimPlate for heterotrophic plate counts products have been approved by the EPA for use under various regulatory programs. When used for compliance monitoring, water testing products are subject to similarly extensive regulatory processes in other countries around the world.

Dairy testing products. Dairy products used in National Conference on Interstate Milk Shipments (“NCIMS”) milk-monitoring programs in the U.S. are regulated by the FDA as veterinary medical devices. Before these products can be sold in the U.S., performance data must be submitted in accordance with an FDA-approved protocol administered by an independent body, such as the Association of Analytical Chemists Research Institute (“AOAC RI”). While some foreign countries accept AOAC RI certification as part of their regulatory approval process, many countries have separate regulatory processes. All test methods used for drug residue testing require validation by the FDA and acceptance by the NCIMS. IDEXX has two FDA-validated test products, SNAP NBL and SNAP Tetra, for sale in the U.S.

Human point-of-care electrolyte and blood gas analyzers. Our human point-of-care electrolyte and blood gas analyzers are classified by the FDA as Class I and/or Class II medical devices, and their design, manufacture, and marketing are regulated by the FDA. Accordingly, we must comply with cGMP in the manufacture of these products. The FDA’s Quality System regulations set forth standards for our product design and manufacturing processes, require the maintenance of certain records, and provide for inspections of our facilities by the FDA.

Other Chemical, Environmental, and Human Health Safety Regulations. All IDEXX products must comply with applicable global product regulations, including those governing consumer product safety and materials requirements such as the Europeans Union's Electromagnetic Compatibility (“EMC”) Directive, the European Regulation for Registration, Evaluation, Authorization and Restriction of Chemical Substances (“REACH”), the Restriction of Hazardous Substances (“RoHS”) Directive, and the Waste Electrical and Electronic Equipment Directive. These complex regulatory requirements create risk to IDEXX’s ability to market and sell our products, our business, and our financial performance.

In the European Union, our analyzers and certain associated equipment are subject to the requirements of the RoHS Directive, which regulates and restricts certain hazardous substances in electrical and electronic equipment. Other countries, including China, have implemented or anticipate implementing regulatory regimes similar to the RoHS Directive. Our veterinary diagnostic instrument systems are not subject to regulation under the EU Medical Device Regulation or In Vitro Diagnostic Medical Device Regulation, which are both strictly applicable to human use products. However, these systems are required to meet CE certification, which require compliance with the RoHS Directive, the EMC Directive, and other safety requirements. Most countries in which we sell our products impose similar registrations and/or certification requirements.

The European Union was among the first to regulate and restrict the use of certain substances that we currently use in our products. These regulations include the Biocidal Products Regulation, which requires the use of only approved biocides in our products imported to or used in the European Union, and REACH, which regulates and restricts the use of certain chemicals in the European Union. Compliance with these regulations (and similar regulations that have been or may be adopted elsewhere, such as Australia, China, Turkey, Korea, and other countries) may require registration, notification, or certification regarding regulated substances, imposition of import restrictions, or in certain cases the redesign or reformulation of our products. As part of the microplastics restrictions pursuant to REACH, some of our products, including Companion Animal products, may be subject to derogation, such as labeling and reporting.

In the U.S., the EPA regulates chemical use similarly to the European Union. In addition, certain states have their own chemical regulations, such as California's Proposition 65, which requires businesses to provide warnings to California residents about significant risk of exposures to chemicals in products that are known to cause cancer, birth defects, or other reproductive harm. PFAS (per- and polyfluoroalkyl substances), which may be contained in certain IDEXX products, are a subject of increasing regulatory attention. The European Union proposed draft regulations regarding PFAS, which include restrictions and/or phase-out requirements. In the U.S., the EPA has published a PFAS rule under the Toxic Substance Control Act, requiring manufacturers of PFAS and importers of products containing PFAS to file certain information, including PFAS chemical identity and structure, production, imports of products containing PFAS, use, byproducts, exposure, disposal, and health and environmental effects. Other countries have proposed similar regulations, including Australia, Canada, and Brazil. In addition, a number of U.S. states have also developed product reporting and/or phase-out requirements. While statutory exemptions exist in Maine, where we manufacture many of our products, some U.S. states have developed a range of product reporting, labeling and/or phase-out requirements. For example, Minnesota will implement a regulation banning PFAS in products that impact water products beginning in 2032.

In addition to the foregoing, our business is generally subject to various U.S. and foreign regulatory authorities, including the U.S. Federal Trade Commission (the “FTC”) and other anti-competition authorities, and we are also subject to anti-bribery and anti-corruption laws, such as the U.S. Foreign Corrupt Practices Act and the UK Bribery Act; import and export laws and regulations, including U.S. import and export control and sanctions laws; and laws and regulations governing the collection, use, retention, sharing and security of data such as the EU General Data Protection Regulation and the EU Data

Act. Our products that use generative or other forms of artificial intelligence (“AI”) may also be subject to new and emerging law and regulations, including the European Union’s Artificial Intelligence Act enacted in August 2024. Development or acquisition of new products and technologies may subject us to additional areas of government regulation. These may involve medical device, water-quality, and other regulations of the FDA, the EPA, the USDA, the FTC, and other federal agencies, as well as state, local and foreign governments. For more information about the risks associated with various U.S. and foreign government regulation, refer to “Various U.S. and foreign government regulations could limit or delay our ability to market and sell our products or otherwise negatively impact our business” under “Part I, Item 1A. Risk Factors.”

HUMAN CAPITAL

As innovation and customer focus are important parts of our strategy to create long-term value, we aim to attract, motivate, develop, and retain talented employees at all levels who are aligned with and passionate about our Purpose by:

• Building and sustaining an inclusive culture of equal opportunity that welcomes, respects, and supports all employees;
• Offering competitive and locally relevant compensation and benefits that support our employees’ overall well-being; and
• Providing growth and development opportunities for our employees, including leadership training.

Because our strategy includes developing strong, deep relationships with our veterinary customers around the world, we have focused on growing our companion animal diagnostics field-based organization globally.

Culture of Inclusion and Equal Opportunity. IDEXX promotes a culture of inclusion and equal opportunity that values the different skills, perspectives, and backgrounds that each employee brings in pursuit of our Purpose. We believe that this culture helps drive both innovation and a better understanding of our increasingly global customer base aligned with long-term value creation. We employ inclusive recruitment practices to source highly qualified candidates and we maintain an environment where advancement is determined by demonstrated performance, capability, and contribution. We encourage and promote an inclusive culture at IDEXX, including through executive sponsorship of employee-led communities that are open to, and support, all of our employees.

As of December 31, 2025, we had approximately 11,000 regular full-time and part-time employees in approximately 34 countries around the world, and men and women represented 41% and 59%, respectively, of our global employee population. We are an equal opportunity employer, and we aim to have talent management processes that provide equal career advancement opportunities for all our employees.

Our policies strictly prohibit any form of employment discrimination, and pursuant to applicable law, we annually collect certain demographic data regarding our U.S. workforce, which we report in our EEO-1 report to the U.S. Equal Opportunity Commission. Our summarized EEO-1 survey data is disclosed on our website.

Compensation, Benefits and Well-being. We offer fair, competitive compensation and a wide array of competitive and locally relevant benefits (which vary by country and region) that support our employees’ overall well-being, including comprehensive health and welfare insurance; generous time-off and leave; retirement and financial support. We have recognition programs for the purpose of acknowledging the achievements of individual and team performance. We recognize that offering best-in-class well-being programs is an important element of an effective total rewards strategy and use benchmarking and our understanding of our workforce to identify and implement holistic well-being programs that we believe are aligned with our culture and meet our employees’ needs. Accordingly, our well-being programs have strong utilization by our employee base, and we review these programs from time to time to confirm they are achieving the anticipated outcomes. We provide free counseling for employees and their dependents globally through our mental wellness partner. Interactive holistic well-being resources are available to employees globally, including monthly educational webinars, ergonomic support, team fitness challenges, nutrition programs, and self-guided courses on a broad range of topics. In addition, employees have access to financial education and our employees, their spouses, and adult dependents in North America can engage with a financial coach for help reaching their personal financial goals.

We are focused on enabling managers, teams, and employees to identify the most effective work arrangements to accomplish their goals. For some teams this consists of 100% onsite work, while others employ remote or hybrid models. Our goal is to promote a positive workplace environment where everyone can contribute to their fullest potential. We strive to build a collaborative culture through in-person and virtual events, including town halls, in-office celebrations, and employee-led communities.

The health, safety, and well-being of our employees is a top priority at IDEXX. We provide our employees with the training, tools, and resources to help safeguard their health, and we empower them to put safety first. Our Environmental Health & Safety (“EH&S”) team oversees the IDEXX EH&S management system and our company-wide safety programs, and is responsible for the implementation at all of our locations of health and safety processes designed to maintain and improve employee safety, reduce workplace risks, and drive continual improvement.

Growth and Development. We are steadfast in our focus on cultivating the leaders of tomorrow and making career development opportunities accessible across the company. We offer in-person and virtual training; our goal is to provide robust training development options that are accessible to all levels and geographies and in multiple languages. Our career development programs are designed to build capabilities and enable career progression. We offer multiple leadership development programs to address the needs of employees at different stages of their professional careers, including new people managers, frontline leaders, mid-level leaders, and business leaders, with the goal of building their capabilities and enhancing their readiness for the next step in their leadership journey. We also encourage employees to enhance their career development through individual development plans and job-related courses and degree programs.

Employee Turnover and Engagement. Our human capital priorities include retaining a skilled and engaged workforce. We monitor our overall and managerial employee turnover and engagement to identify opportunities to strengthen our approach to human capital management, and we have been successful with our employee engagement efforts to achieve and maintain low turnover rates that are healthy for our sector.

We regularly conduct company-wide employee surveys through a third party to collect employee input on our culture, their experiences, and workplace conditions. These survey results provide insights that help us to improve employee engagement. Our most recent global employee survey received a high level of response, and we maintained a strong level of engagement, consistent with prior years. We leverage the insights gained from the survey to develop a roadmap for improving engagement and retention.

ENVIRONMENTAL, HEALTH, AND SAFETY AND CLIMATE CHANGE MATTERS

Our operations are subject to various environmental, health, and safety laws and regulations concerning, among other things, the generation, handling, transportation, and disposal of hazardous substances or wastes, the cleanup of hazardous substance releases, emissions or discharges into the air or water, and occupational safety and health. The ongoing cost of complying with such laws and regulations is significant and may increase in the future, particularly in the European Union, where we are required to comply with increasingly extensive regulations. We continue to monitor legislative and regulatory actions and their potential impacts on the areas where we conduct business.

In addition to monitoring and managing compliance with environmental, health and safety laws and regulations, we strive to reduce our environmental footprint, although greenhouse gas emissions from our operations are not significant. We have developed and are executing a greenhouse gas emissions reduction strategy. To monitor our progress in meeting our environmental goals, we track and publicly report our environmental impact metrics, including greenhouse gas emissions and energy consumption. In pursuit of our goals, we have developed initiatives and multi-year projects to reduce our greenhouse gas emissions, integrate sustainability considerations for new product development and design, and reduce the amount of plastic and other material waste from current products and packaging. Our most recent Corporate Responsibility Report, which is available on our website, is informed by the Sustainability Accounting Standards Board and the Task Force on Climate-Related Financial Disclosures frameworks and provides our most recent sustainability highlights for our products and operations. Information contained on or connected to our website is not incorporated by reference into this Annual Report on Form 10-K and should not be considered part of this Annual Report on Form 10-K or any other filing we make with the SEC.

AVAILABLE INFORMATION

Our principal executive offices are located at One IDEXX Drive, Westbrook, Maine 04092, our telephone number is 207-556-0300, and our internet address is www.idexx.com (http://www.idexx.com). References to our website in this Annual Report on Form 10-K are inactive textual references only and the content of our website, including our Corporate Responsibility Report, should not be deemed incorporated by reference for any purpose.

We make available free of charge at www.idexx.com (http://www.idexx.com) our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we file such information with, or furnish it to, the SEC. In addition, copies of our reports filed electronically with or furnished electronically to the SEC may be accessed at www.sec.gov (http://www.sec.gov).

Our Corporate Governance Guidelines and our Code of Ethics are also available on our website at www.idexx.com (http://www.idexx.com).

You should consider carefully the risks and uncertainties described below in addition to the other information included or incorporated by reference in this Annual Report on Form 10-K in evaluating our company and our business. Our future operating results involve a number of risks and uncertainties, and actual events or results may differ materially from those discussed in this Annual Report on Form 10-K. Factors that could cause or contribute to such differences include, but are not limited to, the factors discussed below, as well as those factors discussed elsewhere herein. Any of these factors, in whole or in part, could materially and adversely affect our business, financial condition, operating results, prospects, and stock price. The disclosures below reflect our beliefs and opinions as to factors that could materially and adversely affect us in the future. References to past events are provided by way of example only and are not intended to be a complete listing or a representation as to whether or not such factors have occurred in the past.

RISKS RELATED TO OUR BUSINESS AND INDUSTRY

Our business lines are highly attractive and highly competitive. Our failure to successfully execute certain strategies in this competitive environment could have a material negative impact on our future growth and profitability

The companion animal healthcare industry is highly competitive, and we anticipate increasing competition from both existing competitors and new sector entrants given our performance and the industry’s strong growth and returns. Maintaining or enhancing our growth rates and profitability depends on successful execution of many elements of our strategy, including:

• Developing, manufacturing, and marketing innovative new or improved and cost competitive point-of-care laboratory analyzers that drive sales of IDEXX VetLab instruments, grow our installed base of instruments, and increase demand for related recurring sales of consumable products, services, and accessories;
• Developing and introducing new or improved innovative diagnostic tests and services for both our reference laboratories and point-of-care applications that provide valuable medical information to our customers and effectively differentiate our products and services from those of our competitors;
• Developing and introducing new or improved innovative, data-insightful software solutions that enable our veterinary customers to improve practice management and efficiency, staff productivity, and client engagement and communications and that increase the value to our customers of our other companion animal products and services by enhancing the integration of the information and transactions of these products and services and supporting the interpretation and management of diagnostic information derived from these products and services;
• Maintaining premium pricing, including by effectively implementing price increases, for our products and services through, among other things, effective communication and promotion of their value in an environment where many of our competitors promote, market, and sell lesser offerings at lower prices;
• Providing our veterinary customers with the medical and business tools, information, and resources that enable them to grow their practices and increase utilization of our diagnostic products and services through increased pet visits and preventive care protocol use, enhanced practice of real-time care, and improved practice efficiency;
• Achieving cost improvements in our worldwide reference laboratory network by implementing global best practices, including lean processing techniques, technological enhancements (e.g., automation and a global laboratory information management system), purchasing strategies that maximize leverage from our global scale, increasing the leverage of existing infrastructure, and consolidating testing in high volume laboratory hubs;
• Achieving cost improvements in the manufacture and service of our point-of-care laboratory analyzers by employing the benefits of economies of scale in both negotiating supply contracts and leveraging manufacturing overhead, and by improving reliability of our instruments;
• Continuing to expand, develop, and advance the effectiveness and productivity of our companion animal diagnostic sales, marketing, customer support, and logistics organizations in the U.S. and international regions in support of, among other things, our all-direct sales strategies and best-in-class customer experience goals;
• Attracting, developing, and retaining key leadership and talent necessary to support all elements of our strategy;
• Strengthening our sales and marketing activities to reach customers and expand diagnostic and software use both in and outside the U.S.;
• Identifying, completing, and integrating acquisitions that enhance our existing businesses, create new businesses for us, or expand the geographic areas in which we do business;
• Continuing to responsibly incorporate AI, machine learning, and automation into our products and services and associated business processes, such as customer support and software development;
• Developing and implementing new technology and licensing strategies; and
• Continuing to effectively manage our growth and expansion on a global scale through, among other things, designing and implementing cost-effective improvements to our processes, procedures, and infrastructure.

If we are unsuccessful in implementing and executing on some or all of these strategies, our rate of growth or profitability may be negatively impacted.

Our dependence on third-party suppliers could negatively affect our ability to sell certain products or deliver our cloud-based software solutions, which could negatively affect our operating results

We rely on third-party suppliers to provide components and raw materials (including biological materials) for our manufactured products, manufacture some of the products that we sell, provide the cloud-based infrastructure through which we deliver our cloud-based software solutions, and perform certain services, including package-delivery services. Actions taken by third-party suppliers in operating their business, as well as any disruptions to their business operations (or their suppliers' business operations), could disrupt our supply chain or operations and materially negatively impact our ability to supply the market or deliver our cloud-based software solutions, substantially decrease sales, lead to higher costs, and damage our reputation with our customers. Longer-term disruptions could potentially result in the permanent loss of our customers, which could reduce our recurring revenues and long-term profitability.

Our supply chain and our cost of goods also may be adversely impacted by unanticipated price increases due to factors such as inflation (including wage inflation), supply restrictions beyond our control or the control of our suppliers, the imposition of tariffs or duties, or regulatory requirements regarding the importation, exportation, composition, or production processes of the goods or materials provided by our suppliers. If current suppliers fail to supply sufficient goods or materials that comply with applicable regulatory requirements to us on a timely basis, or at all, or are unable to comply with any due diligence requests that may be required pursuant to applicable law or regulation, we could experience inventory shortages and disruptions in our supply of goods or materials.

For examples of some of the events that could result in disruption to our supply chain or operations, and negatively impact our operating results, refer to “Various U.S. and foreign government regulations could limit or delay our ability to market and sell our products or otherwise negatively impact our business,” “We depend on the continuous and reliable operation and security of our information technology systems and our products and services that incorporate or rely on information technology, and any disruption or significant cybersecurity breach or other incident could adversely affect our business” and “Factors and events beyond our control could disrupt our operations, supply chain, and logistics network and adversely affect our business” below.

In addition, we currently purchase many products, components, and materials from sole or single sources, such as Ortho. Some of these products are proprietary and, therefore, cannot be readily or easily replaced by alternative sources. These products, components, and materials are used in our instruments, consumables and accessories; livestock and poultry diagnostic tests, dairy testing products; and water testing products. Even if products, components, and materials were to become available to us from alternative suppliers, we likely would incur additional costs and delays in identifying and qualifying replacement materials, and there can be no assurance that replacements would be available to us on acceptable terms, or at all. In certain cases, we may be required to obtain regulatory approval to use alternative suppliers, and this process of approval could delay production of our products or development of product candidates indefinitely.

We seek to mitigate sole and single-source supplier risks on a risk-prioritized basis and in a variety of ways, including, when possible, by identifying and qualifying alternative suppliers, developing applicable in-house manufacturing capabilities and expertise, entering into escrow arrangements for manufacturing information for certain single or sole-sourced products, and strategically maintaining safety stock. We also seek to enter into long-term contracts that provide for an uninterrupted supply of products at predictable or fixed prices. However, there can be no assurance that we will successfully implement any of these mitigating activities or that, if implemented, any of them will be effective in preventing any delay or other disruption in our ability to supply our customers. In addition, suppliers may decline to enter into long-term contracts for any number of reasons, which would require us to purchase products, components, or raw materials via short-term contracts or on a purchase order basis. There can be no assurance that suppliers with which we do not have long-term contracts will continue to supply our requirements, will always fulfill their obligations under those contracts, or will not experience disruptions in their ability to supply our requirements. In cases where we purchase sole and single-source products, components, or raw materials under purchase orders, we are more susceptible to unanticipated cost increases or changes in other terms of supply. In addition, under some contracts with suppliers we have minimum purchase obligations, and our failure to satisfy those obligations may result in loss of some or all of our rights under these contracts or require us to compensate the supplier. If we are unable to obtain adequate quantities of products, components, or raw materials in the future from sole and single-source suppliers, or if such sole and single-source suppliers are unable to obtain the components or other materials required to manufacture the products, we may be unable to supply our customers, which could have a material adverse effect on our results of operations and damage our reputation, and any longer-term disruptions could potentially result in the permanent loss of customers, which could reduce our recurring revenues and long-term profitability.

Our biologic products are complex and difficult to manufacture, which could negatively affect our ability to supply our customers

Many of our rapid assay, livestock and poultry diagnostic, water, and dairy products are biologic products that include biological materials, such as antibodies, cells, and sera. Manufacturing biologic products is highly complex due to the inherent variability of biological materials and the difficulty of controlling the interactions of these materials with other components of the products, samples, and the environment. There can be no assurance that we will be able to maintain adequate sources of biological materials or that we will be able to consistently manufacture biologic products that satisfy applicable product release criteria and regulatory requirements. Further, products that meet release criteria at the time of manufacture may fall out of specification while in customer inventory, which could require us to incur expenses associated with recalling products and providing customers with new products, either of which could damage customer relations and our reputation. Our inability to produce or obtain necessary biological materials or to successfully manufacture biologic products that incorporate such materials could result in our inability to supply our customers with these products, which would have an adverse effect on our results of operations and damage our reputation.

Issues in our use of AI may result in reputational harm or liability and adversely affect our business

We have built, and expect to continue to build, AI into many of our product and service offerings, and we expect this element of our business to grow. We also use and are investing in AI tools for our internal business operations, including to generate code, develop products and services, and increase operational efficiency. We envision a future in which responsible AI operating in our devices, applications, and the cloud helps our customers be more productive in their business activities and interactions with consumers, and we effectively use AI in our operations to improve innovation, efficiency, and customer experience and value. As with many disruptive innovations, AI presents risks and challenges. AI algorithms and models may be flawed. Datasets may be insufficient or contain information that is non-representative, infringing, or otherwise subject to legal challenge. Our competitors may incorporate AI into their products, services, and operations more quickly, more successfully and more cost-effectively than us, which could impede our ability to compete. Existing and potential government regulation related to AI use may also foreclose certain areas of AI use, cause us to modify how we use AI, and increase the burden and cost of research and development and compliance in this area, and there is uncertainty around the validity and enforceability of intellectual property rights related to the use, development, and deployment of AI. Our use of AI may also lead to novel cybersecurity or privacy risks, which may adversely affect our operations and reputation. Failure to properly remediate AI usage issues may cause public confidence in AI to be undermined, which could slow adoption of AI in our offerings. The rapid evolution of AI combined with the evolving and unharmonized legal and regulatory landscape will require the application of resources to develop, test, and maintain our products and services to help ensure that AI is implemented in a manner to minimize unintended, harmful impact and to comply with applicable law. Although we continue to invest in AI, those investments may be substantial, and there can be no assurance that our investments will be beneficial to our business. Further, while we strive to develop and use AI responsibly and in compliance with law, including through implementing strong governance processes, there can be no assurance that we will address all AI-related issues that may arise. The failure to address such issues could damage our reputation, give rise to legal and/or regulatory action, or otherwise adversely affect our business.

Various U.S. and foreign government regulations could limit or delay our ability to market and sell our products or otherwise negatively impact our business

As a global business, we sell products and services in more than 175 countries and operate in an increasingly complex legal and regulatory environment. In the U.S., the manufacture and sale of certain of our products are regulated by federal agencies, such as the USDA, the FDA, and the EPA. Our diagnostic tests for animal health applications that involve the detection of infectious diseases, including most rapid assay canine and feline SNAP tests and livestock and poultry diagnostic tests, must be approved by the USDA prior to sale in the U.S. Our dairy testing products require approval by the FDA before they may be sold commercially in the U.S. The methods used by our water testing products must be approved by the EPA, as a part of its water quality monitoring program, before they can be used by customers in the U.S.

Delays by government agencies in approving new products or product upgrades or taking action with respect to other regulatory matters could have a negative impact on our growth and profitability. The ability of government agencies to review and approve new products or product upgrades or take other actions can be affected by various factors, including government budget and funding levels, ability to hire and retain key and other personnel, staffing shortages, public health emergencies, and statutory, regulatory, and policy changes. If a prolonged government shutdown or other disruption of normal business operations occurs, it could significantly impact the ability of the USDA, FDA, EPA, and other agencies to timely review and process our regulatory submissions, including with respect to new product candidates, which could have a material adverse effect on our business. Similarly, a prolonged government shutdown or other disruption could prevent the timely review of patent applications by the U.S. Patent and Trademark Office, which could delay the issuance of U.S. patents to which we would otherwise be entitled.

We are also subject to chemical regulation in the U.S., such as California’s Proposition 65, which requires businesses to provide warnings to California residents about significant risk of exposures to chemicals in products that are known to cause cancer, birth defects, or other reproductive harm. In addition, governmental authorities in the U.S. are increasingly focused on preventing environmental contamination from per- and polyfluoroalkyl substances (“PFAS”), which may be contained in certain IDEXX products. For example, current law in Maine prohibits the sale in Maine of non-exempt products containing intentionally-added PFAS after January 1, 2032, unless the Maine Department of Environmental Protection has made an unavoidable use determination, and requires reporting after the applicable sales ban takes effect of the presence of PFAS in products that have received unavoidable use determinations. However, these bans and reporting requirements in Maine are currently subject to statutory exemptions for veterinary products and medical devices regulated by or under the jurisdiction of the FDA, USDA, or EPA, as well as products that are used for public health, or for environmental or water quality testing. In addition, federal and state governments and agencies are in various stages of considering and/or implementing laws and regulations requiring the reporting, restriction, and/or phase-out of PFAS in products.

The manufacture, import, and sale of our products, as well as our research and development processes, are subject to similar and sometimes more stringent laws in many foreign countries. For example, the European Union regulates the use of certain substances that we currently use in our products or processes. These regulations include, but are not limited to, the Biocidal Products Regulation, which requires the use of approved biocides in our products prior to being manufactured, used, or sold in the European Union; the European Regulation for Registration, Evaluation, Authorization and Restriction of Chemical Substances, or REACH, which regulates and restricts the use of chemicals in the European Union; the Restriction of Hazardous Substances (“RoHS”) Directive, which regulates and restricts certain hazardous substances in electrical and electronic equipment; the Electromagnetic Compatibility Directive; and the Waste Electrical and Electronic Equipment Directive. In addition, European Union regulatory authorities and certain European countries are contemplating regulations to restrict and phase-out PFAS. Other countries have proposed similar regulations, including Australia, Canada, and Brazil.

Compliance with these and similar laws, directives and regulations in the U.S. and abroad may require registration of the applicable substances, performance of due diligence across our supply chain and reporting thereon, and/or the redesign or reformulation of our products, and may reduce or eliminate the availability of certain parts and components used in our products and services or lead us to change our suppliers in the event our suppliers are unable to comply with our due diligence requests or the applicable regulations in a timely and cost-effective manner. In extreme situations, compliance with these laws, directives and regulations may require us to eliminate or discontinue the use of a part or component in one or more products, but the redesign or reformulation of such products without such parts or components may not be possible, or cause us to relocate the production of certain products. Any redesign or reformulation, change in our suppliers, restrictions in our supply of parts and components, or relocation may negatively affect the availability or performance of our products and services, add testing lead-times for products and reformulated products, reduce our margins, result in additional costs, or have other similar effects. Any inability to redesign or reformulate one or more of our products may preclude us from marketing and selling such products in the applicable regions. In addition, the costs to comply with these regulations may be significant. Any of these could adversely affect our business, financial condition, or results of operations. These legal and regulatory requirements are complex and subject to change, and we continue to evaluate their impact.

In addition, some foreign governments require us to register or certify our products before they can be distributed or sold, and these product registration requirements, which vary among the applicable jurisdictions and change from time to time, are often complex and require us to engage in lengthy and costly processes and provide confidential, proprietary information about those products to foreign regulatory agencies. For example, compliance with extensive country-specific regulatory processes is required in connection with importing, marketing, and selling our diagnostic products in Japan, Germany, Canada, Brazil, the Netherlands, China, and many other countries. There can be no assurance that we will be able to obtain or maintain any product registration required by one or more foreign governments. Any inability to obtain or maintain a required product registration in a jurisdiction could adversely affect our ability to market and sell the applicable product in that jurisdiction, which could have a negative effect on our business, financial condition, and results of operations. There can also be no assurance that confidential, proprietary information provided to foreign regulatory agencies may not be accessed by unauthorized persons or otherwise stolen, which could negatively impact our ability to protect our proprietary rights in our innovative products and our future success. For more information about the risks related to the protection of our proprietary rights in our products and services, refer to “Our success is heavily dependent on our continued differentiated product and service innovation” below.

There has been a recent focus in the U.S. on laws and regulations related to AI, which cover, among other things, algorithm accountability, privacy, and transparency. For example, use of AI and machine learning may be subject to laws and evolving regulations regarding, among other things, data bias and anti-discrimination. For example, the Federal Trade Commission (“FTC”) enforces consumer protection laws such as Section 5 of the FTC Act, which prohibits unfair and deceptive practices. AI-related legislation has also been introduced in a number of U.S. state legislatures and enacted in some states, such as California and Colorado, but the current U.S. administration issued an executive order in December 2025 to establish a federal policy aimed at curbing the proliferation of state-level AI-related legislation. In August 2024, the European Union Artificial Intelligence Act, which establishes requirements for the provision and use of products that leverage AI, machine learning, and similar technologies was enacted and will become fully effective in August 2026, with some provisions effective February 2025. Additionally, other countries have proposed legal frameworks to regulate AI, which is a trend that may continue to increase, and Japan enacted AI-related legislation in May 2025. Any failure or perceived failure by us to comply with such requirements could have an adverse impact on our business.

We are also subject to a variety of federal, state, local, and international laws and regulations governing our global business practices. For example, jurisdictions in which we operate prohibit bribery and corruption, anti-competitive behavior, and money laundering; impose trade compliance requirements and restrictions, such as prohibitions on doing business with certain entities or individuals; determine rules impacting the importation and exportation of our products; and regulate immigration and travel. These legal, regulatory, and sometimes politically motivated requirements differ among jurisdictions around the world and are rapidly changing and increasingly complex. The costs associated with compliance with these legal and regulatory requirements and adjusting to changing legal and political environments are significant and likely to increase in the future.

Any failure by us to comply with applicable legal and regulatory requirements, or to adjust to changing legal and political environments, could result in fines, penalties, and sanctions; product recalls; suspensions or discontinuations of, or limitations or restrictions on, our ability to design, manufacture, market, import, export or sell our products; and damage to our reputation. Any of these could negatively impact our business.

Our success is heavily dependent on our continued differentiated product and service innovation

We believe our future success significantly depends on our ability to continue, on a cost-effective and timely basis, to enhance our existing differentiated product and service offerings, to continue to incorporate AI, machine learning and automation into our products and services and associated business processes and to develop and introduce new and innovative differentiated products and services. As a result, we invest substantial funds and efforts into research and development, investigating new products and technologies being developed by third parties, and obtaining certain such new products and technologies through licenses or acquisitions. There can be no assurance that our research and development, licensing, or acquisition efforts will achieve expected results, when or whether any of our products or services now under development will be launched, or whether we may be able to develop, license or otherwise acquire new products or technologies or successfully incorporate AI capabilities into our products, services or associated business processes. We also cannot predict whether any product or service offering, once launched, will achieve market acceptance, or achieve sales and revenue consistent with our expectations.

We rely on a combination of patent, trademark, copyright, and trade secret laws to protect our proprietary rights. We also license patents and technologies from third parties to enable the use of third-party technologies in the development, production, and provision of our products and services. If we do not have adequate protection of our proprietary rights or are unable to license third-party patents and technologies on reasonable terms, our business may be restricted or adversely affected by competitors who utilize substantially equivalent technologies to compete with us.

We cannot ensure that we will obtain issued patents, that any patents issued or licensed to us will remain valid, or that any patents owned or licensed by us will provide protection against competitors with similar technologies. Even if our patents cover products or services sold by our competitors, the time and expense of litigating to enforce our patent rights could be substantial and could have an adverse effect on our results of operations. In addition, expiration of patent rights could result in substantial new competition for products or services previously covered by those patent rights.

In the past, we have received notices claiming that our products or services infringe third-party patents, and we may receive such notices in the future. Patent litigation is complex and expensive, and the outcome of patent litigation can be difficult to predict. We cannot ensure that we will be successful in a patent litigation or be able to negotiate an acceptable resolution of such a case. If unsuccessful, we may be prohibited from selling certain products or services and/or we may be required to pay damages and/or ongoing royalties as a result of the lawsuit. Any such result could have an adverse effect on our results of operations.

Increased competition from and technological advances by our competitors could negatively affect our operating results

We face intense competition, and we expect that competition will further intensify as new products, services and technologies become available, the use of AI and machine learning expands, and new competitors enter the space. Our competitors in the veterinary diagnostic sector in the United States and abroad include companies that develop, manufacture, and sell veterinary diagnostic tests; commercial veterinary reference laboratories; certain large and well-funded animal health pharmaceutical companies; and corporate hospital chains that operate reference laboratories that serve both their hospitals and unaffiliated hospitals, such as VCA Inc., which is wholly-owned by Mars, Incorporated, another operator of corporate hospital chains that also sells veterinary point-of-care diagnostic instruments. Consolidation among our competitors and our customers may intensify the competition we face. While we believe that our offerings are competitively differentiated due to our innovative products and services that offer an integrated, comprehensive diagnostic solution and the quality of our technical and customer service, there can be no assurance that increased consolidation among our competitors or customers (as well as any resulting veterinary diagnostic vertical integration among our customers) would not have a negative impact on our ability to compete successfully. For more information regarding the risks presented by consolidation and reference laboratory vertical integration among our customers, refer to “Consolidation in our customer base, including through increased corporate hospital ownership, and prevalence of buying consortiums could negatively affect our business” below.

Competition could negatively affect our sales and profitability in a number of ways. New competitors may emerge through the development of innovative new technology (such as the use of AI and machine learning), the acquisition of rights to use existing technologies or the use of existing technologies when patents protecting such existing technologies expire. New or existing competitors may introduce new, innovative, and competitive products and services more quickly, successfully, and effectively, and these products and services could be superior, or be perceived by our customers to be superior, to our products and services or lead to the obsolescence of one or more of our products or services. Business combinations and mergers among our competitors may result in competitors that are better positioned to create, market, and sell more compelling product and service offerings. While an important aspect of our strategy is to continue, on a cost-effective and timely basis, to enhance our existing products and services (including through the incorporation of AI capabilities) and to develop and introduce new and innovative products and services, there can be no assurance that we will be able to successfully develop or introduce such products and services or that those products or services will be superior to our competitors’ products or services or otherwise achieve customer acceptance. Some of our competitors and potential competitors may choose to differentiate themselves by offering products and services perceived in the eyes of customers as similar, at substantially lower sales prices, which could have an adverse effect on our results of operations through loss of sales and/or revenues or a decision to lower our own sales prices to remain competitive. In addition, our ability to attract and retain customers depends on the effectiveness of our customer marketing and incentive programs, and multiple competitors could bundle product and service offerings through co-marketing or other arrangements, which could enhance their ability to compete with our broad product and service offerings. Certain of our competitors and potential competitors, including large diagnostic and pharmaceutical companies, also have substantially greater financial and managerial resources than us, as well as greater experience in manufacturing, marketing, research and development, and obtaining regulatory approvals than we do.

Consolidation in our customer base, including through increased corporate hospital ownership, and prevalence of buying consortiums could negatively affect our business

Veterinarians are our primary customers for our CAG products and services, and the veterinary services industry in the U.S. and abroad has become increasingly consolidated. In the United States, the number of owners of veterinary hospitals has been declining, and an increasing percentage of veterinary hospitals are owned by corporations. Major corporate hospital owners in the U.S. include Mars, Incorporated (owner of Banfield Pet Hospitals, Blue Pearl Veterinary Partners, and VCA Inc.) and National Veterinary Associates. A similar trend exists in other regions such as Canada, the United Kingdom, Europe, Australia, New Zealand, China, and Brazil. Furthermore, an increasing percentage of individually owned veterinary hospitals in the U.S. participate in buying consortiums. Corporate owners of veterinary hospitals and buying consortiums often seek to improve profitability by leveraging the buying power they derive from their scale to obtain favorable pricing from suppliers, which could have a negative impact on our profitability and results of operations. While we have strong supplier relationships with several corporate hospital groups and buying consortiums, decisions by larger corporate owners and buying consortiums to shift their purchases to a competitor would have a negative impact on our results of operations from the loss of future business. Under these circumstances, we may receive customer contract resolution payments, which would generally be recorded in other operating income in the period received. Nonetheless, the loss of future revenue may still be significant and adversely affect our future revenue growth rate and profitability. In addition, certain corporate owners also operate reference laboratories that serve both their hospitals and unaffiliated hospitals and, in some cases, sell veterinary point-of-care diagnostic instruments. Any hospitals acquired by these companies generally attempt to shift all or a large portion of their testing to the reference laboratories operated by these companies, and may attempt to shift their point-of-care diagnostic testing, as well, and there can be no assurance that hospitals that otherwise become affiliated with these companies would not shift all or a portion of their diagnostic testing. Furthermore, hospitals acquired by these companies or those that establish other affiliations with these companies may cease to be customers or potential customers of our other companion animal products and services, which would cause our sales of these products and services to decline.

Changes in testing patterns could negatively affect our operating results

Demand for our companion animal, livestock and poultry diagnostic tests and our dairy and water testing products could be negatively impacted by factors impacting testing practices. The introduction or broad market acceptance of vaccines or preventatives for the diseases and conditions for which we sell diagnostic tests and services could result in a decline in testing. Changes in accepted medical protocols regarding the diagnosis of certain diseases and conditions could have a similar effect. Eradication or substantial declines in the prevalence of certain diseases also could lead to a decline in diagnostic testing for such diseases. Our livestock and poultry products business in particular is subject to fluctuations resulting from changes in disease prevalence. The outbreak of certain diseases (such as African swine fever) among livestock or poultry, or the adverse impact of climate change-related events (such as hurricanes, earthquakes, fires, and floods), could lead to the widespread death or precautionary destruction of such animals in the affected regions, reducing herd or flock sizes, which could reduce the demand for our testing products for such animals. Changes in government regulations or in the availability of government funds available for monitoring programs could negatively affect sales of our products that are driven by compliance testing, such as our livestock and poultry, dairy, and water products. In addition, changes and trends in local dairy, poultry, or other food sectors around the world could negatively affect the related production markets resulting in a decline in demand for our testing products. The growth of our CAG business relies in part on a stable pet population and evolving testing patterns of increasing frequency and depth of diagnostic testing. Significant reductions to the pet population or to veterinary protocols that reduce the frequency of diagnostic testing, due to macroeconomic conditions or other reasons, could have an adverse effect on our results of operations. Actual or perceived economic weakness, whether due to inflation or other factors, may also reduce demand for our companion animal, water, livestock, poultry, and dairy products and services, and public health-related guidance and directives, including stay-at-home orders that may be deployed to combat public health issues, and severe weather conditions could result in a decrease in companion animal clinical visits, the delay of elective procedures and wellness visits and disruption of veterinary clinic operations, all of which would have a negative effect on veterinary service providers and result in declines in demand for our CAG products and services. Declines in testing for any reason, including the reasons described above, along with lost opportunities associated with a reduction in the pet population or veterinary visits, could have an adverse effect on our results of operations.

We sell many products through distributors, which presents risks that could negatively affect our operating results

Some of our international product sales occur through third-party distributors. As a result, we are dependent on these distributors to promote and create demand for our products. Our distributors often offer products from several different companies, including our competitors, and may promote our competitors’ products over our own products. We have limited ability, if any, to cause our distributors to devote adequate resources to promoting, marketing, selling, and supporting our products or to maintain certain inventory levels, and changes in our distributors’ inventory levels, compared to comparable prior periods, could negatively impact our revenue growth rates. There can be no assurance that we will be successful in maintaining and strengthening our relationships with our distributors or establishing relationships with new distributors who have the ability to market, sell, and support our products effectively. We may rely on one or more key distributors for a product or a region, and the loss of these distributors could reduce our revenue. Distributors may face financial difficulties, including bankruptcy, which could harm our collection of accounts receivable and financial results. While we maintain a rigorous distribution compliance program, violations of anti-corruption or similar laws by our distributors could have a material impact on our business and reputation, and any termination of a distributor relationship may result in increased competition in the applicable jurisdiction. Failure to manage the risks associated with our use of distributors may reduce sales, increase expenses, and weaken our competitive position, any of which could have a negative effect on our operating results.

GENERAL RISKS

We depend on the efforts of key personnel and talent to succeed and compete effectively

Our continued success is substantially dependent on our ability to attract, develop, and retain highly capable and skilled leaders, employees, and other key personnel. Competition for experienced leaders and employees, particularly for persons with specialized skills, such as software and AI, can be intense. Our ability to recruit and retain such talent will depend on a number of factors, including compensation and benefits, work location, flexibility regarding virtual and hybrid work arrangements, work environment, corporate culture, and development opportunities.

The loss of the services of, or our failure to recruit or develop and implement effective succession plans for, our senior leadership, other key personnel, and employees may significantly delay or prevent the achievement of our strategic objectives, disrupt our operations, and adversely affect our business and our future success. In addition, even if we effectively develop and implement succession plans and make key leadership transitions, such as our planned CEO transition in May 2026 that we announced on January 13, 2026, we cannot provide assurances as to whether we may experience management or other challenges in connection with any of those leadership transitions that could adversely affect our future success and could otherwise materially adversely affect our business, reputation, results of operations, and financial condition.

We depend on the continuous and reliable operation and security of our information technology systems and our products and services that incorporate or rely on information technology, and any disruption or significant cybersecurity breach or other incident could adversely affect our business

We rely on our information systems and third-party information systems to provide access to our web-based products and services, keep financial records, analyze results of operations, process orders and shipments, manage inventory, store confidential or proprietary information, and operate other critical functions. In addition, some of our products and services are cloud-based and connect to the “Internet of Things” (“IoT”), including information systems that collect and use data on behalf of customers (e.g., veterinary practice management systems and customer communication tools and services) and our connected IoT devices (e.g., IDEXX VetLab Stations and analyzers) that enable our integrated, comprehensive diagnostic solution for veterinary practices, and these products and services rely on third-party providers for cloud computing and storage. These information systems and networks are susceptible to damage, disruption, or shutdown from multiple factors, including failures during the process of upgrading or replacing software, databases, or components; power outages; telecommunications or system failures; terrorist attacks; natural disasters; individual error or malfeasance; server or cloud provider breaches; computer viruses or cyber security attacks or other breaches or incidents. Although we maintain security policies and measures and internal controls, employ system backup measures, engage in redundancy planning and processes, and invest in our data and information technology infrastructure, such policies, measures, controls, planning processes, and investments, as well as our current disaster recovery plans, have not always been effective, and there can be no assurance that these (or any future efforts) will be effective, in preventing any information system or network damage, disruption, or shutdown. The continued use of remote and hybrid work arrangements may additionally result in some increased risk associated with our employees accessing our data and systems remotely. In addition, the use of AI and other emerging technologies by threat actors is growing, enabling more sophisticated and effective cybersecurity attacks and phishing and social engineering schemes and further increasing attack volume and frequency.

Our software and some of our other products and services incorporate or rely on information technology and systems that are highly technical and complex, and the timely development, testing, release and deployment of software updates are important for defending against security vulnerabilities. If we or our business partners and suppliers fail to timely develop, test and deploy software updates, the security of our and our customers’ networks and information systems may be at risk. Vulnerabilities may persist even after a software update is released if the update fails to address the vulnerability’s root cause or is otherwise insufficient, testing of the update delays its timely deployment, there is a failure to install the most recent updates, or customers persist in using solutions that are end of life and no longer receive updates. Furthermore, updates or other software changes can lead to software or system inoperability or inadvertently introduce security vulnerabilities, including vulnerabilities that had been previously remedied or from malicious code injected in a “supply chain” cyberattack. In addition, in some cases, we rely on third-party providers to develop, test and release software updates on a timely basis, and there can be no assurance that these third-party providers will timely or effectively remedy vulnerabilities.

We, and some of our third-party vendors, have experienced cybersecurity attacks by threat actors (which may include state-sponsored organizations or nation state actors) and other cybersecurity breaches and incidents in the past, including, among other things, computer viruses and malware, ransomware, denial of service actions, phishing schemes, social engineering, the compromise, misappropriation and/or unauthorized access to (or acquisition or disclosure of) confidential or otherwise protected information, and similar events, and will likely experience further attacks, breaches and incidents in the future, potentially with more frequency. To our knowledge, none have resulted in any material adverse impact to the Company, our business strategy, results of operations or financial condition. We have adopted measures to mitigate potential risks associated with information technology disruptions and cybersecurity threats; however, given the unpredictability of the timing, nature, and scope of such disruptions and the evolving nature of cybersecurity threats, which vary in technique and sources, if we or our business partners or suppliers were to experience a system disruption, attack or security breach or incident that impacts any of our critical functions, or our customers were to experience a system disruption, attack or security breach or incident via any of our software or connected IoT products and services, we could be subject to production downtimes, operational and/or productivity delays, other detrimental impacts on our operations or ability to provide products and services to our customers, the compromise, misappropriation and/or unauthorized access to (or acquisition or disclosure of) confidential or otherwise protected information, destruction or corruption of data, security breaches, other manipulation or misuse of our systems or networks, financial losses and additional costs from remedial actions, repairs to infrastructure, physical systems or data processing systems, increased cybersecurity and information technology protection costs, loss of business or potential liability, and/or damage to our reputation, any of which could have a material adverse effect on our business strategy, competitive position, results of operations, cash flows, financial condition, or prospects. We, our customers, and other users of our products and services also may not promptly learn of or have the ability to fully assess the magnitude or effects of a security vulnerability in connected IoT devices and networks, including the extent, if any, to which a vulnerability has been exploited. Additionally, we have acquired, and in the future may acquire, companies or assets that have less sophisticated information systems, cybersecurity practices, or training, which may result in an increased risk of cybersecurity attacks, breaches, or incidents. Our customers and/or employees could also face negative consequences such as the compromise of sensitive or critical information or systems. Furthermore, access to, public disclosure of, or other loss of data or information (including any of our confidential or proprietary information or personal data or information) as a result of an attack or security breach or incident has given, and in the future may give, rise to notification obligations to individuals, regulators, customers, employees, and others, and could result in governmental actions or private claims or proceedings, any of which could damage our reputation, cause a loss of confidence in our products and services, damage our ability to develop (and protect our rights to) our differentiated technologies, and have a material adverse effect on the Company, our business strategy, financial condition, results of operations, or prospects. While we maintain a cyber risk insurance policy, it may not cover any or all claims, costs or losses associated with all cybersecurity events. For more information regarding personal data and information privacy and data protection risks, refer to “Our operations and reputation may be impaired if we, our products, or our services do not comply with our global privacy policy or evolving laws, regulations, and industry standards regarding data privacy and protection” below.

Factors and events beyond our control could disrupt our operations, supply chain, and logistics network and adversely affect our business

Our business and results of operations could be negatively affected by certain factors and events beyond our control, such as natural disasters, severe weather conditions and/or climate change-related events (such as hurricanes, earthquakes, fires, and floods); public health issues (such as outbreaks, epidemics, or pandemics); civil or military unrest; geopolitical conditions and developments; war, terrorism, armed conflict, or other man-made disasters (including cyberwar, cyberterrorism, or state-sponsored attacks); disruption or loss of service from our cloud service providers; inflationary pressures, which may increase costs for materials and finished goods; adverse or uncertain macroeconomic conditions, including fears of a global economic downturn or recession; increases in wages that drive up prices; rising interest rates; workforce disruptions; labor shortages or stoppages; the imposition of regulations, trade protection measures, tariffs, duties, import/export restrictions, quotas or embargoes on key components; transportation failures affecting the supply and shipment of materials and finished goods; and the unavailability of raw materials. Any of these events could result in, among other things, damage to or the temporary closure of one or more of our manufacturing or distribution facilities or reference laboratories (damage to one of our facilities or the manufacturing equipment we use could be costly and may require substantial lead-time to repair or replace); damage to or closure of one or more facilities of our third-party business partners or suppliers on which we rely; a temporary lack of an adequate work force in one or more sites; an interruption in power supply; a temporary or long-term disruption in our supply chain or logistics network (including a disruption to our ability to obtain critical components for the manufacture of our products); a temporary disruption in our ability to deliver (or delays in the delivery of) our products or services; and short- or long-term damage to our customers’ businesses (which would adversely impact customer demand for our products and services). For our veterinary customers, these events may negatively affect the number of patient visits and elective procedures, and the volume of diagnostic utilization, and may otherwise disrupt clinical operations, which could adversely affect our revenues. For more information regarding the risks presented by disruption to our suppliers’ operations and supply chain, refer to “Our dependence on third-party suppliers could negatively affect our ability to sell certain products or deliver our cloud-based software solutions, which could negatively affect our operating results” above.

We manufacture many of our significant companion animal products, including our rapid assay products and certain instruments and consumables, many of our water testing products and certain of our livestock, poultry, and dairy testing products in Southern Maine. Certain of our companion animal products, as well as our human point-of-care products, are manufactured in Roswell, Georgia. We also manufacture certain of our livestock and poultry testing products in Bern, Switzerland and Montpellier, France. In addition, we maintain major distribution facilities in North America and in the Netherlands and reference laboratories in multiple locations, including Memphis, Tennessee; Kornwestheim, Germany; West Sacramento, California; Elmhurst, Illinois; North Grafton, Massachusetts; Brisbane, Australia; Markham, Ontario; Wetherby, U.K.; and Tokyo, Japan. Interruption of operations at any of our facilities, including the ones described above, due to the occurrence of one or more of the events described above could have an adverse effect on our results of operations.

While we maintain plans to continue business under such circumstances, there can be no assurance that such plans will be successful in fully or partially mitigating the effects of such events. We also maintain property and business interruption insurance to insure against the financial impact of certain events of this nature. However, this insurance may be insufficient to compensate us for the full amount of any losses that we may incur. In addition, such insurance will not compensate us for potential long-term competitive or reputational effects of being out of the market for the period of any interruption in operations.

Since our business is global in nature, geopolitical risks and other risks associated with doing business internationally could negatively affect our business, financial condition, and operating results

For the year ended December 31, 2025, approximately 36% of our overall revenue and approximately 34%, 81% and 50% of our CAG, LPD, and Water revenues, respectively, were attributable to sales of products and services to customers outside the U.S. Although we intend to continue to expand our international operations and business, we may not be able to successfully promote, market, import, export, sell, or distribute our products and services outside the U.S. Various risks associated with foreign operations may impact our international sales and operations, including, but not limited to, disruptions in transportation of our products or our supply chain; fluctuations in oil prices; increased border protection and restriction on travel; the differing product and service needs of foreign customers; difficulties in building, staffing, and managing foreign operations (including a geographically dispersed workforce); differing protection of intellectual property; trade protection measures, quotas, embargoes, import/export restrictions, capital controls, tariffs, duties, and regulatory and licensing requirements; natural and other disasters; public health issues (such as outbreaks, epidemics, or the prospect of a pandemic); ongoing instability or changes in a country’s or region’s regulatory, economic, or political conditions, including inflation, recession, interest rate fluctuations, and actual or anticipated military or political conflicts; geopolitical crises, including terrorism, war, armed conflict, or civil or military unrest; other unfavorable geopolitical conditions; security concerns; and local business and cultural factors that differ from our normal standards and practices, including business practices prohibited by the Foreign Corrupt Practices Act and other anti-corruption laws and regulations.

In addition, to market and sell many of our products outside the U.S., we are subject to product approval and registration requirements that often require us to provide confidential, proprietary information about those products to foreign regulatory agencies. There can be no assurance that the confidential, proprietary information provided to foreign regulatory agencies to comply with product approval and registration requirements may not be accessed by unauthorized persons or otherwise stolen, which could negatively affect our ability to protect our proprietary rights in our innovative products and our future success. We also may forgo marketing and selling some of our products in certain foreign jurisdictions due to the risk of intellectual property theft, which could negatively affect our ability to expand our international operations and business. For more information about the risks related to the protection of our proprietary rights in our products and services, refer to “Our success is heavily dependent on our continued differentiated product and service innovation” above.

Further, prices that we charge to foreign customers may be different than the prices we charge for the same products in the U.S. due to competitive, market or other factors, or changes in foreign currency exchange rates. Our results of operations are also susceptible to changes in foreign currency exchange rates. As a result, the mix of domestic and international sales in a particular period could have an adverse impact on our results of operations for that period.

A weak worldwide economy, or actual or perceived economic weakness in any significant geography, could result in reduced demand for our products and services or increased customer credit risk

A substantial percentage of our sales are made worldwide to the companion animal veterinary industry. Demand for our companion animal diagnostic products and services is driven in part by the number of patient visits to veterinary hospitals and the practices of veterinarians with respect to the recommendations for diagnostic testing, as well as pet owner compliance with these recommendations. Pet owners generally pay cash out of pocket for health care services for their pets from veterinary practices. Actual or perceived economic weakness, whether due to inflation or other factors, in any of our significant geographies could cause pet owners in those regions to forgo or defer visits to veterinary hospitals or affect their willingness to approve certain diagnostic tests, comply with a treatment plan or, even more fundamentally, continue to own a pet. In addition, concerns about the financial resources of pet owners could cause veterinarians to be less likely to recommend certain diagnostic tests, and concerns about the economy may cause veterinarians to defer purchasing capital items such as our instruments and systems. These conditions, if they continue, could result in a decrease in sales or decrease in sales growth, of diagnostic products and services, which could have an adverse effect on our results of operations.

Demand for our water products is driven in part by the availability of funds at government laboratories, water utilities, and private certified laboratories that utilize our products. Availability of funds also affects demand by government laboratories and cattle, swine and poultry producers that utilize our livestock and poultry diagnostic products. Actual or perceived economic weakness and the other factors described above have caused and could continue to cause our customers to reduce their investment in such testing, which could have an adverse effect on our results of operations.

A weak economy may also cause deterioration in the financial condition of our distributors and customers, which could inhibit their ability to meet their performance obligations or pay us amounts owed for products delivered or services provided in a timely fashion or at all.

We are subject to risks associated with public health issues, including pandemics, which could have a material adverse effect on our financial condition and results of operations

We are subject to risks associated with public health issues, including pandemics and other events beyond our control. Public health issues and crises may adversely impact our operations, supply chain and logistics network if the locations where we operate, manufacture or distribute our products; where our raw materials or product components are sourced, manufactured or distributed; or where our third-party distributors, suppliers and other service providers operate, are disrupted, temporarily closed or experience worker shortages for a sustained period of time. In addition, public health issues and crises may adversely impact our customers’ businesses due to business lockdowns, decreased companion animal clinical visits, labor shortages, the delay of elective procedures and wellness visits, and disruption of veterinary clinic and other customer operations, all of which could cause a decline in demand for our products and services. These disruptions could also cause economic slowdowns or increased economic uncertainty.

A future public health issue, pandemic, or outbreak could lead to delays in the manufacturing and supply of products, or adversely affect the ability of the USDA, FDA, EPA, or other government agencies to timely review and process our regulatory submissions, which could have a material adverse effect on our business and results of operations. Moreover, any future public health issue, pandemic, or outbreak could result in the imposition of new governmental restrictions, quarantine requirements or other public health measures, which could result in closures or other restrictions that significantly disrupt our operations or those of our third-party distributors, suppliers or other service providers, or otherwise adversely affect our customers’ businesses or operations, or result in actual or perceived economic weakness or slowdowns in one or more of our key geographies, any of which could adversely affect our financial condition.

Our operations and reputation may be impaired if we, our products, or our services do not comply with our global privacy policy or evolving laws, regulations, and industry standards regarding data privacy and protection

Our business operations involve the receipt, storage, transmission, and use of information, including personal data, about our customers, pet owners, suppliers, and employees. We collect and use personal data in a variety of ways. We offer products and services that collect and use personal data, including veterinary practice management systems, online customer communication tools and services, VetConnect PLUS, and two-way integration technology. Some of these products and services rely on third-party providers for cloud computing and storage. We also engage in e-commerce through various websites and collect contact and other personal data from our customers and website visitors, and some of our software products and services enable access to point-of-sale credit card processing functionality for our veterinary customers. In addition, we transfer information, including personal data, among IDEXX, our subsidiaries and third parties with which we have commercial relations for business purposes. Our collection, transfer, protection, security, retention, storage, disclosure, sharing and use of personal data are subject to expanding and increasingly complex laws and regulations in the U.S. and abroad. In addition, these laws and regulations continue to develop and are subject to frequent revisions (and generally have become more stringent over time), are subject to differing interpretations, may be applied inconsistently from jurisdiction to jurisdiction and could be deemed to be inconsistent with our current global privacy policy and data protection practices. Further, some of our customer contracts require us to comply with industry standards adopted by industry groups related to the storage, processing, and transmission of individual cardholder data.

While we maintain a program to monitor, assess, and comply with applicable global data privacy laws and relevant industry standards, compliance with these evolving requirements is costly, may require us to change our business practices in a manner adverse to our business, and may delay or impede the development and offering of innovative products and services. Additionally, public perception and standards related to the privacy of personal data can shift rapidly, in ways that may affect our reputation or influence regulators and industry groups in the U.S. and abroad to expand or adopt more stringent regulations, laws, and standards. As a global company, we are tasked with navigating a patchwork of privacy laws, both in the U.S. and abroad, which may have conflicting requirements that can make compliance challenging. Some examples include (but are not limited to) the California Consumer Privacy Act, as amended by the California Privacy Rights Act; various U.S. state consumer privacy laws that apply to our business operations within a respective state and/or a U.S. federal privacy law that may be passed in the future; the European Union’s General Data Protection Regulation (“GDPR”), Switzerland’s Federal Act on Data Protection, and the United Kingdom’s General Data Protection Regulation (“UK GDPR”), which impose stringent operational requirements for controllers and processors of personal data of individuals in the European Economic Area (“EEA”), Switzerland, and the United Kingdom (“UK”); the Brazilian General Data Protection Law; the Chinese Personal Information Protection Law; the Japanese Act on the Protection of Personal Information; and the Australian Privacy Act.

An additional area of complexity concerns the restrictions on transfers of personal data from certain countries to others. We currently rely on a mixture of mechanisms to transfer certain personal data from the EEA, Switzerland, and the UK to the U.S. and other third countries including the EU-U.S. Data Privacy Framework (the “EU-U.S. DPF”), the Swiss-U.S. Data Privacy Framework, and the UK Extension to the EU-U.S. DPF. A challenge to the EU-U.S. DPF adequacy decision, adopted in July of 2023, will be reviewed by the European Court of Justice, and international transfers to the U.S. and other jurisdictions generally continue to be subject to enhanced scrutiny by regulators. Any transfers by us or our vendors of personal data are subject to potential regulatory scrutiny and may increase our exposure under the GDPR, UK GDPR, and similar laws which contain cross-border personal data transfer heightened requirements and restrictions (such as the Chinese government standard contract for cross-border personal data transfers).

Any failure or perceived failure by us, the third parties with whom we work, or our products and services to comply with all applicable privacy-related laws, regulations, and standards, as well as our contractual obligations, could result in damage to our reputation, legal proceedings or actions against us by governmental entities or others, fines and other penalties, damage to our ability to enable access to credit card processing functionality for our veterinary customers, and revenue losses, any of which could have an adverse effect on our business. In addition, concerns about our practices with regard to the collection, use, retention, transmission, disclosure, or security of personal data or other privacy-related matters, even if unfounded and even if we are in compliance with applicable laws, regulations, standards, and contractual obligations, could damage our reputation and harm our business.

Failure to meet current or evolving environmental, social, and governance regulations, standards, or expectations or to achieve our environmental, social, or governance goals could adversely affect our business, results of operations, financial condition, reputation, or stock price

Regulators, investors, customers, employees, and other stakeholders are focused on environmental, social, and governance matters, including climate-related issues; human capital matters; and responsible sourcing, human rights, and supply chain. Regulators in the U.S., Europe, and elsewhere are considering or have proposed or adopted various laws, directives or regulations regarding these matters, which include specific, target-driven disclosure requirements or obligations, including the European Union’s Corporate Sustainability Reporting Directive and California’s Climate Corporate Data Accountability Act and Climate-Related Financial Risk Act. Furthermore, our investors, customers, and other stakeholders have additional (and sometimes different or contradictory) expectations.

We strive to align our environmental, social and governance goals with our long-term business-strategy and Purpose. Some stakeholders, however, including government regulators, may disagree with some or all of our goals and initiatives. The focus of our various stakeholders remains inconsistent and may also change and evolve over time, and they continue to have very different (and sometimes contradictory) views on which matters should be prioritized or even undertaken at all. Meeting these emerging and evolving regulations, standards and expectations exposes us to unpredictable reporting obligations or business requirements and will require us to make strategic choices and investments, incur compliance costs, and create new practices, processes, and procedures. We also may be unable to satisfy all stakeholders in light of their varied and sometimes contradictory views and expectations regarding environmental, social, and governance matters. In addition, if we fail (or are perceived to fail) to comply with applicable regulations, or our practices do not meet evolving and sometimes contradictory investor, customer or other stakeholder expectations and standards, then our reputation, ability to attract and retain employees, relationships with some customers, and attractiveness as an investment, business partner, acquiror, or product or service provider could be negatively impacted, and we may be exposed to government enforcement actions, private litigation, and increased scrutiny from investors, special interest groups, government regulators, and other stakeholders, any of which could adversely affect our business, results of operations, financial condition, reputation, or stock price.

Our ability to achieve any of these goals is subject to numerous risks, many of which are outside of our control and depend in part on third-party performance or data, and there can be no assurance that we will achieve or maintain them. Our failure (actual or perceived) to adequately update, accomplish or accurately track and report on these goals on a timely basis, or at all, could adversely affect our reputation and expose us to increased scrutiny from investors, special interest groups, and enforcement authorities.

Climate change, or legal, regulatory or market measures to address climate change, could adversely affect our business, financial condition, and results of operation

We operate in many regions around the world where our businesses and the activities of our customers and suppliers could be disrupted by climate change. We are exposed to physical risks (such as extreme weather conditions or rising sea levels), risks in transitioning to a low-carbon economy (such as additional legal or regulatory requirements, changes in technology, market risk, and reputational risk) and social and human effects (such as harm to health and well-being) associated with climate change. These risks can be either acute (short-term) or chronic (long-term).

Potential physical risks from climate change may include altered distribution and intensity of rainfall, prolonged droughts or flooding, increased frequency of wildfires and other natural disasters, rising sea levels, and a rising heat index, any of which could cause negative impacts to our and our customers’ and suppliers’ businesses. Increased frequency and severity of extreme weather events could adversely impact our suppliers, manufacturing locations, logistics, and/or customers. Such impacts may include losses incurred as a result of physical damage to facilities, loss or spoilage of inventory, and business interruption and disruption (e.g., decrease in companion animal clinical visits and diagnostic utilization). Other potential physical impacts due to climate change include reduced access to high-quality water in certain regions and the loss of biodiversity, which could impact future product development. These risks could disrupt our operations and supply chain, which may result in increased costs, or adversely affect our revenues.

New legal or regulatory requirements may be enacted to prevent, mitigate, or adapt to the implications of a changing climate and its effects on the environment. These regulations, which may differ across jurisdictions, could result in our being subject to new or expanded carbon pricing or taxes, increased compliance costs, restrictions on greenhouse gas emissions, investment in new technologies, increased carbon disclosure and transparency, investments in developing data gathering and reporting systems, upgrade of facilities to meet new building codes, increased energy costs, and the redesign of utility systems, which could increase our operating costs. Our supply chain would likely be subject to these same transitional risks and would likely pass along any increased costs to us, which may impact our ability to procure goods or services required for the operation of our business at the quantities and levels we require.

Future operating results could be negatively affected by changes in tax rates, the adoption of new tax legislation or exposure to additional tax liabilities

The nature of our global operations subjects us to local, state, regional, and federal tax laws in jurisdictions around the world. Our future tax expense could be affected by changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, or changes in tax laws or their interpretation.

While we have taken, and may take further, actions intended to align our corporate structure and intercompany relationships with supporting our growth in international geographies and maintaining operational and tax efficiency and continue to consider all of these developments within our overall tax strategy, changes in tax law in the U.S. and other countries in which we operate or have a presence may materially and adversely impact our income tax liability, provision for income taxes, effective tax rate and results of operation, and there can be no assurance that any actions we take to maintain operational and tax efficiency will effectively mitigate these impacts. Moreover, these actions may increase our operating costs, and if ineffectual, could increase our income tax liabilities and our global effective tax rate.

Our income tax filings are subject to examination by various tax authorities, and the final determination of tax audits could be materially different from that which is reflected in historical income tax provisions and accruals. Significant judgment is required in determining our worldwide provision for income taxes. We regularly assess our exposures related to our worldwide provision for income taxes to determine the adequacy of our provision for taxes. Any reduction in these contingent liabilities or additional assessments would increase or decrease income, respectively, in the period such determination is made.

If the ultimate determination of taxes owed is for an amount in excess of amounts previously accrued, our business, results of operations and financial condition could be materially adversely affected.

Strengthening of the rate of exchange for the U.S. dollar has a negative effect on our business

We are a global business, with 36% of our revenue during the year ended December 31, 2025, attributable to sales of products and services to customers outside of the U.S. Any strengthening of the rate of exchange for the U.S. dollar against foreign currencies, and in particular the euro, British pound, Canadian dollar, Chinese renminbi, Japanese yen, Australian dollar and Brazilian real, adversely affects our results, as it reduces the dollar value of sales and profits that are made in those currencies. The strengthening of the U.S. dollar has a greater adverse effect on the profits from products manufactured or sourced in U.S. dollars that are exported to international geographies and a lesser effect on profits from foreign sourced products and services due to a natural hedge from international expenses denominated in the corresponding foreign currencies.

For the year ended December 31, 2025, approximately 23% of our consolidated revenue was derived from products manufactured or sourced in U.S. dollars and sold internationally in local currencies, compared to 22% and 21% for the years ended December 31, 2024, and December 31, 2023, respectively. A strengthening U.S. dollar could also negatively impact the ability of customers outside the U.S. to pay for purchases denominated in U.S. dollars as well as affect our overall competitiveness in international geographies. The accumulated impacts from any continued, longer-term growth in the value of the U.S. dollar against foreign currencies may have a material adverse effect on our operating results. Refer to “Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk” included in this Annual Report on Form 10-K for additional information regarding currency impact.

Our foreign currency hedging activities (refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 19. Hedging Instruments” in the accompanying Notes to consolidated financial statements), which are designed to minimize and delay, but not to eliminate, the effects of foreign currency fluctuations, may not sufficiently offset the adverse financial effect of unfavorable movements in foreign exchange rates on our financial results over the limited time the hedges are in place. In addition, our hedging activities involve costs and risks, such as transactions costs and the risk that our hedging counterparties will default on their obligations.

We primarily hedge intercompany product purchases and sales denominated in the euro, British pound, Canadian dollar, Japanese yen, and Australian dollar. Other foreign currency exposures related to foreign sourced services and emerging markets may not be practical to hedge. In certain cases, these exposures are not offset by foreign currency denominated costs. As we primarily use foreign currency exchange contracts with durations of less than 24 months and enter into contracts to hedge incremental portions of anticipated foreign currency transactions on a quarterly basis for the current and following year, the effectiveness of our foreign currency hedging activities to offset longer-term appreciation in the value of the U.S. dollar against non-U.S. currencies may be limited. Factors that could affect the effectiveness of our hedging activities include accuracy of sales and other forecasts, volatility of currency markets, and the cost and availability of hedging instruments. Since our hedging activities are designed to minimize volatility, they not only temporarily reduce the negative impact of a stronger U.S. dollar, but they also temporarily reduce the positive impact of a weaker U.S. dollar. Our future financial results could be significantly affected by a strengthening value of the U.S. dollar in relation to the foreign currencies in which we conduct business. The degree of this effect for any given time period will depend in part upon our hedging activities.

Restrictions in our debt agreements or our inability to obtain financing on favorable terms may increase our cost of borrowing and limit our activities

Our ability to make scheduled payments and satisfy our other obligations under our Credit Facility and senior notes depends on our future operating performance and on economic, financial, competitive, and other factors beyond our control. Our business may not generate sufficient cash flows to meet these obligations or generate sufficient levels of earnings to satisfy the applicable affirmative, negative, and financial covenants. Our failure to comply with these covenants and the other terms of the Credit Facility and senior notes could result in an event of default and acceleration of our obligations under these agreements, which may require us to seek additional financing or restructure existing debt on unfavorable terms. In addition, adverse changes in credit markets could increase our cost of borrowing and make it more difficult for us to obtain financing, which could limit our ability to execute certain strategies and have an adverse effect on our revenue growth and profitability.

Our senior notes require payment of a prepayment penalty in the event that we elect to repay the notes prior to their stated maturity dates. Should we elect to repay some or all of the outstanding principal balance on our senior notes prior to their stated maturity dates, the prepayment penalty we incur could adversely affect our results of operations and cash flows.

We fund our operations, capital purchase requirements, and strategic growth needs through cash on hand, funds generated from operations, amounts available under our Credit Facility and senior note financings. If we are unable to obtain financing on favorable terms, we could face restrictions that would limit our ability to execute certain strategies, which could have an adverse effect on our revenue growth and profitability.

Borrowings under our Credit Facility bear interest at variable rates, including rates based on the Secured Overnight Financing Rate (“SOFR”), exposing us to interest rate risk. If interest rates were to increase, our debt service obligations under our variable-rate Credit Facility would increase even if the principal amount borrowed remained the same.

RISKS RELATED TO AN INVESTMENT IN OUR SECURITIES

Fluctuations in our quarterly or annual results may cause our stock price to decline

Our prior operating results have fluctuated due to a number of factors, many of which are beyond our control, including seasonality of certain product lines; changes in our accounting estimates; the impact of acquisitions; timing of distributor purchases, product launches, operating expenditures, and customer marketing and incentive programs; changes in the number and type of competitors and their product and service offerings; changes in our sales and distribution model; changes in the economy affecting consumer spending; and other matters. Similarly, our future operating results may vary significantly from quarter to quarter or year to year due to these and other factors. If our operating results or projected operating results do not meet the expectations of securities analysts or investors in future periods, our stock price may decline.

The market price of our common stock may be volatile, and you may not be able to resell your shares at or above the price you paid

The trading price of our common stock may be volatile. Securities markets worldwide experience significant price and volume fluctuations. This market volatility, as well as other general economic, market, or political conditions, could reduce the market price of our common stock rapidly and unexpectedly, in spite of our operating performance as demonstrated during 2025 where the range of our stock price was from a low of $361.04 to a high of $766.68. Factors that may impact the market price of our common stock include the factors described in this “Risk Factors” section and elsewhere in this Form 10-K, as well as:

• Our stock repurchase program and changes in our capital structure or cost of capital, including the issuance of additional debt or equity;
• Public announcements (including the timing of these announcements) regarding our business, financial performance and prospects or new products or services, product enhancements or technological advances by our competitors or us;
• Trading activity in our stock, including portfolio transactions in our stock by the company, our executive officers and directors, and significant stockholders; trading activity that results from the ordinary course rebalancing of stock indices in which we may be included, such as the S&P 500 Index; trading activity related to our inclusion in, or removal from, any stock indices; and short interest in our common stock, which could be significant from time to time;
• Investor perception of the company and the industry and sectors in which we operate, including changes in earnings estimates or buy/sell recommendations by securities analysts; and whether or not we meet earnings estimates of securities analysts; and
• General financial, domestic, international, economic, and market conditions, including overall fluctuations in the U.S. equity and credit markets, which may experience extreme volatility that, in some cases, is unrelated or disproportionate to the operating performance of particular companies.

Our Cybersecurity Risk Management Program

Like other companies, we currently inhabit an environment of increasing global cybersecurity vulnerabilities and threats. We aim to effectively assess, identify, and manage material risks from these cybersecurity threats through our cybersecurity risk management program.

Our cybersecurity risk management program includes processes that incorporate and utilize certain principles from the National Institute of Standards and Technology Cybersecurity Framework and the Center for Internet Security – Top 18 Critical Security Controls – Control Level Framework. The program aims to protect and preserve the security, availability, integrity, confidentiality, and privacy of our information systems and information residing on those systems and includes controls and procedures for the prevention, identification, containment, and remediation of cybersecurity threats through the use of various technologies, tools, policies, standards, and practices. Features of our cybersecurity risk management program include:

• An expectation, set forth in our Code of Ethics, that all employees are responsible for protecting our data, operations and environment from unauthorized access and use;
• Regular cybersecurity risk assessments and benchmarking;
• Policies and processes related to the detection and reporting of and response to cybersecurity events;
• Cybersecurity training for all newly hired employees upon onboarding;
• Individualized, biannual employee information security assessments, coupled with tailored follow-on employee trainings;
• Phishing tests conducted at least quarterly on a global basis, with additional periodic phishing tests conducted with high-risk employee groups;
• Channels for employees to report suspicious emails or other activity and the actual or suspected loss, theft, improper use of or access to IDEXX systems or information;
• Deployment and ongoing assessment of the effectiveness of technological tools aimed at preventing, detecting, and mitigating cybersecurity threats;
• Policies and procedures to assess third-party service provider cybersecurity risks and security controls and measures (as part of our procurement process and periodically thereafter);
• Periodic performance of cybersecurity tabletop exercises;
• Regular review of and, as applicable, updates to our cyber incident response plan and protocols, system backup measures, redundancy planning, and disaster recovery plans; and
• Maintenance of a cyber risk insurance policy to help address risk of loss due to certain types of cybersecurity events.

A review of cybersecurity risks is integrated into our annual enterprise risk assessment that occurs as part of our annual strategic planning process and is included in our quarterly disclosure controls and procedures. Our annual enterprise risk assessment process involves the identification and assessment by senior line-of-business and functional leaders, including our Chief Information Security Officer (“CISO”) and Chief Digital and Information Officer (“CDIO”), of the risks relevant to their lines of business and functional areas, the materiality of those risks, our risk tolerances and our plans to manage and mitigate the risks to the extent prudent and feasible.

From time to time, we engage third parties, including assessors, consultants, legal counsel, and others to conduct penetration testing, assess our program, provide recommendations for improvement, and advise us on best practices.

Material Effects from Risks of Cybersecurity Threats

We do not believe any risks from cybersecurity threats (including from any prior cybersecurity incidents) have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition. There can be no assurances, however, that we or our business partners or suppliers will not experience a future system disruption, attack or security breach that materially impacts our business, operations, results of operations, or financial condition. For more information refer to “Item 1A. Risk Factors, General Risks, We depend on the continuous and reliable operation and security of our information technology systems and our products and services that incorporate or rely on information technology, and any disruption or significant cybersecurity breach or other incident could adversely affect our business.”

Governance of our Cybersecurity Risk Management Program

Role of Management

Our cybersecurity risk management program and activities are led by a dedicated CISO who is also a Vice President of Information Technology. Our CISO reports to our Executive Vice President and General Manager, Global Reference Laboratories, Diagnostic Solutions and Information Technology, and oversees a team of information security professionals within the Information Security Group. Our CISO joined IDEXX in 2024 and has more than twenty years of business and technical experience leading information technology teams, including cybersecurity teams, at high tech, marketing, and healthcare companies. Our CISO is responsible for our cybersecurity-related governance programs, overseeing testing of our compliance with standards and remediation of known risks, and leads our employee training program.

Our CISO is responsible for providing information regarding our cybersecurity risk management program, as well as cybersecurity risks and incidents, to a senior management-level cybersecurity steering committee. Within our cybersecurity risk governance model, the steering committee, which includes our CDIO, CISO, General Counsel, Chief Compliance Officer, Chief Audit Executive, Chief Human Resources Officer, and other senior functional and business leaders, meets quarterly, and more frequently as warranted, to review and discuss, among other things, our cybersecurity risk assessments, prioritization of initiatives, training plans and incident response plan, protocols and testing. This committee regularly provides updates on its discussions and decisions to our Chief Executive Officer.

Role of the Board of Directors

The Audit Committee has responsibility for overseeing our cybersecurity risk management. In accordance with the Audit Committee’s charter, the Audit Committee at least annually reviews and discusses with management, including the CISO, our processes, policies, procedures, and protocols related to cybersecurity and information security. In addition, the Audit Committee regularly reviews and discusses with management, including the CISO, cybersecurity program assessments and audits, planned improvements, and the status of any information security initiatives, as well as risks from cybersecurity threats pertinent to us and any previous cybersecurity incidents experienced by us, including any material impact or reasonably likely material impact on the Company, our business strategy, results of operations, or financial condition. The Audit Committee provides reports to the Board at each regularly scheduled Board meeting of the matters it has recently addressed, including relating to the oversight of our cybersecurity risk management, and the full Board may participate, as warranted, in the Audit Committee’s sessions on cybersecurity risk management. Outside advisors also may meet from time to time with the Audit Committee or Board, as warranted, to review and discuss cybersecurity matters.

Our worldwide headquarters and principal executive offices are located in Westbrook, Maine where we engage in manufacturing, research and development, marketing, sales, and general and administrative support functions.

Primary Facility Locations

Including the locations above, we have over 50 reference laboratories throughout the United States and over 25 reference laboratories internationally, including locations in Europe, Canada, Australia, New Zealand, Asia, and South Africa. The majority of our reference laboratories are leased, with the remainder being owned. We also lease space in various locations worldwide for administrative support, manufacturing, sales, distribution, and storage. We believe that our leased and owned properties are generally in good condition, are well-maintained, and are generally suitable and adequate to carry on our business.

Due to the nature of our activities, we are at times subject to pending and threatened legal actions that arise out of the ordinary course of business. In the opinion of management, based in part upon advice of legal counsel, the disposition of any such currently pending or threatened matters is not expected to have a material effect on our results of operations, financial condition, or cash flows. However, the results of legal actions cannot be predicted with certainty. Therefore, it is possible that our results of operations, financial condition or cash flows could be materially adversely affected in any particular period by the unfavorable resolution of one or more legal actions.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and related notes appearing elsewhere in this Annual Report on Form 10‑K. The discussion of our financial condition and results of operations and liquidity and capital resources for the year ended December 31, 2023, and year-over-year comparisons between 2024 and 2023, is included in our Annual Report on Form 10-K for the year ended December 31, 2024, within Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.

We have included certain terms and abbreviations used throughout this Annual Report on Form 10-K in the “Glossary of Terms and Selected Abbreviations.”

Description of Business Segments. We operate primarily through three business segments: diagnostic and information management-based products and services for the companion animal veterinary industry, which we refer to as the Companion Animal Group (“CAG”); water quality products (“Water”); and diagnostic products and services for livestock and poultry health and to measure the quality and safety of milk and improve producer efficiency, which we refer to as Livestock, Poultry and Dairy (“LPD”). Refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 3. Revenue and Note 17. Segment Reporting” to the consolidated financial statements for the year ended December 31, 2025, included in this Annual Report on Form 10-K, for financial information about our segments, including our product and service categories, and our geographic areas.

The following is a discussion of the strategic and operating factors that we believe have the most significant effect on the performance of our business.

Companion Animal Group

Our strategy is to provide veterinarians with the highest quality diagnostic information, software products and services, and medical evidence to support more advanced medical care and information management solutions that help demonstrate the value of diagnostics to pet owners and enable efficient and effective practice management. By doing so, we are able to build a mutually successful relationship with our veterinary customers based on healthy pets, loyal customers, staff efficiency, and expanding practice revenues. We also provide products and services that support veterinarians in engaging and communicating directly with pet owners.

CAG Diagnostics. We provide diagnostic capabilities that meet veterinarians’ diverse needs through a variety of modalities, including point-of-care diagnostic solutions and outside reference laboratory services. Veterinarians that utilize our full line of diagnostic modalities obtain a single view of a patient’s diagnostic results, which allows them to track and evaluate trends and achieve greater medical insight.

Our diagnostic capabilities generate both recurring and non-recurring revenues. Revenues related to capital placements of our point-of-care IDEXX VetLab suite of instruments and our SNAP Pro Analyzer are non-recurring in nature because they are sold to a particular customer only once. Revenues from the associated IDEXX VetLab consumables, SNAP rapid assay test kits, reference laboratory and consulting services, and extended maintenance agreements and accessories related to our IDEXX VetLab instruments and our SNAP Pro Analyzer are recurring in nature, because they are regularly purchased by our customers, typically as they perform diagnostic testing as part of ongoing veterinary care services. Our recurring revenues, most prominently IDEXX VetLab consumables and rapid assay test kits, have significantly higher gross margins than those provided by our instrument sales. Therefore, the sales mix of recurring and non-recurring revenues in a particular period will impact our gross margins.

Diagnostic Capital Revenue. Revenues related to the placement of the IDEXX VetLab suite of instruments are non-recurring in nature, because the customer will buy an instrument once over its respective product life cycle, but will purchase consumables for that instrument on a recurring basis as they use that instrument for diagnostic testing purposes. Many instruments are placed through our customer commitment arrangements in exchange for multi-year customer commitments to purchase recurring products and services.

Below is a table showing the installed base units of our premium diagnostic instruments as of the years ended December 31, 2025, 2024, and 2023:

(units in thousands)

Our long-term success in the continuing growth of our CAG recurring diagnostic products and services is dependent upon: growing volumes at existing customers by increasing their utilization of existing and new test offerings, acquiring new customers, maintaining high customer loyalty and retention, and realizing price increases based on our differentiated products and the growing value of our diagnostic offering. We continually seek opportunities to enhance the care that veterinary professionals give to their patients and clients through supporting the implementation of real-time care testing workflows, which are performing tests and sharing test results with the client at the time of the patient visit. Our latest generation of chemistry, hematology, cytology/morphology, and urinalysis instruments demonstrates this commitment by offering enhanced ease-of-use, faster time to results, broader test menu, and connectivity to various information technology platforms that enhance the value of the diagnostic information generated by the instruments. In addition, we provide marketing tools and customer support that help drive efficiencies in veterinary practice processes and allow practices to increase the number of clients they see on a daily basis.

With all of our instrument product lines, we seek to differentiate our products from our competitors’ products based on time-to-result, ease-of-use, throughput, breadth of diagnostic menu, flexibility of menu selection, accuracy, reliability, ability to handle compromised samples, analytical capability of diagnostics software, integration with the IVLS and VetConnect PLUS, client communications capabilities, education and training, and superior sales and customer service. Our success depends, in part, on our ability to differentiate our products in a way that justifies a premium price.

Recurring Diagnostic Revenue. Revenues from our IDEXX VetLab consumable products, our SNAP rapid assay test kits, outside reference laboratory and consulting services, and extended maintenance agreements and accessories related to our CAG Diagnostics instruments are considered recurring in nature. For the year ended December 31, 2025, recurring diagnostic revenue, which is both highly durable and profitable, accounted for approximately 79% of our consolidated revenue.

Our point-of-care diagnostic solutions, consisting of our IDEXX VetLab consumable products and SNAP rapid assay test kits, provide real-time reference laboratory quality diagnostic results for a variety of companion animal diseases and health conditions. Our outside reference laboratories provide veterinarians with the benefits of a more comprehensive list of diagnostic tests and access to consultations with board-certified veterinary specialists and pathologists, combined with the benefit of same-day or next-day turnaround times for most tests.

We derive substantial revenues and margins from the sale of consumables that are used in IDEXX VetLab instruments, and the multi-year consumable revenue stream is significantly more valuable than the placement of the instrument. Our strategy is to increase diagnostic testing within veterinary practices by placing IDEXX VetLab instruments and increasing instrument utilization of consumables. Utilization can increase due to a greater number of patient samples being run or to an increase in the number of tests being run per patient sample. Our strategy is to increase both drivers. To increase utilization, we seek to educate veterinarians about best medical practices that emphasize the importance of chemistry, hematology, cytology/morphology, and urinalysis testing for a variety of diagnostic purposes, as well as by introducing new testing capabilities that were previously not available to veterinarians.

Our point-of-care diagnostic solutions also include SNAP rapid assay tests that address important medical needs for particular diseases prevalent in the companion animal population. We seek to differentiate these tests from those of other point-of-care test providers and reference laboratory diagnostic service providers based on critically important sensitivity and specificity, as demonstrated by peer-reviewed third-party research, as well as overall superior performance and ease-of-use by providing our customers with combination tests that test a single sample for up to six diseases at once, including the ability to utilize our SNAP Pro Analyzer. We further augment our product development and customer service efforts with sales and marketing programs that enhance medical awareness and understanding regarding certain diseases and the importance of diagnostic testing.

The prevalence of point-of-care testing, as opposed to outside reference laboratories such as IDEXX Reference Laboratories, may vary by region. We attempt to differentiate our reference laboratory testing services from those of competitive reference laboratories and competitive point-of-care offerings primarily on the basis of a differentiated test menu, technology employed, quality, turnaround time, customer service, and tools such as VetConnect PLUS that demonstrate the complementary manner in which our laboratory services work with our point-of-care offerings.

Profitability in our laboratory business is supported, in part, by our expanding business scale globally. Profit improvements also reflect benefits from price increases and our ability to achieve operational efficiencies. When possible, we utilize core reference laboratories to service samples from other states or countries, expanding our customer reach without an associated expansion in our reference laboratory footprint. New laboratories may operate at a loss until testing volumes achieve sufficient scale. Acquired laboratories frequently operate less profitably than our existing laboratories, and acquired laboratories may not achieve the profitability of our existing laboratory network for several years until we complete the implementation of operating improvements and efficiencies. Therefore, in the short term, new and acquired reference laboratories generally may have a negative effect on our operating margin.

Recurring reference laboratory revenue growth is achieved both through increased testing volumes, including new test menu additions, with existing customers and through the acquisition of new customers, net of customer losses. We believe the increased number of customer visits by our sales professionals as a result of the growth in our field sales organization has led to increased reference laboratory opportunities with customers who already use one of our point-of-care diagnostic modalities. Recurring reference laboratory diagnostic and consulting revenues have also increased as a result of our customer commitment arrangements, and customer gains from reference laboratory acquisitions, customer list acquisitions, and the opening of new reference laboratories, including laboratories that are co-located with large practice customers.

Veterinary Software, Services, and Diagnostic Imaging Systems. Our portfolio of practice management offerings is designed to serve the full range of customers primarily within the North American, Australian, New Zealand, and European regions. Cornerstone, ezyVet, IDEXX Neo, and Animana practice management systems provide integrated information solutions, backed by customer support and education. These practice management systems support the veterinarian’s ability to practice better medicine and achieve the practice’s business objectives, including a quality client experience, staff efficiency, and practice effectiveness and profitability. We market Cornerstone, ezyVet, and IDEXX Neo practice management systems to customers primarily in North America, Australia, and New Zealand. We market our Animana offering to customers primarily throughout Europe.

Our diagnostic imaging systems offer a convenient radiographic solution that provides superior image quality and the ability to share images with clients virtually anywhere. IDEXX imaging software enables enhanced diagnostic features, including AI-powered tools, reduced manual steps, and time savings on diagnosis, as well as streamlined integration with our other products and services. Our digital radiography systems enable low-dose radiation image capture without sacrificing clear, high-quality diagnostic images, reducing the risk posed by excess radiation exposure for veterinary professionals.

Recurring Revenue. Animana, ezyVet, and IDEXX Neo practice management systems are subscription-based SaaS offerings designed to provide flexible pricing and a durable, recurring revenue stream, while utilizing cloud technology instead of a client server platform. We also offer add-on subscription services, such as Pet Health Network Pro, Vello, Petly Plans, and credit card processing. Our Cornerstone customer base continues to be an important driver of growth through diagnostic integrations and add-on subscription services. We continue to make investments to enhance the customer experience of all of our license-based software offerings. Our large practice management systems installed base provides access to veterinary channel transaction activity, enabling a syndicated data offering.

Our SmartFlow and Vet Radar cloud technology help to improve overall patient management through coordination and tracking of every step in a patient workflow. Our Pet Health Network Pro and Vello software provide online client communication and engagement functionality integrated into our practice management system workflows.

Placements of imaging systems are important to the growth of revenue streams that are recurring in nature, including extended maintenance agreements and IDEXX Web PACS, which is our cloud-based SaaS offering using proprietary AI capabilities to enable optimal sharing, analysis, and storage of diagnostic images. We derive relatively higher margins from our subscription-based products. IDEXX Web PACS is integrated with Cornerstone, ezyVet, IDEXX Neo, and IDEXX VetConnect PLUS to provide centralized access to diagnostic imaging results alongside patient diagnostic results from any internet connected device.

Systems and Hardware. We differentiate our practice management systems through enhanced functionality, ease-of-use, and embedded integration with point-of-care IDEXX VetLab instruments and outside reference laboratory test results. We offer software, hardware, and integrated services that run key functions of veterinary clinics, including managing patient electronic health records, scheduling, client communication, billing, and inventory management. We also provide installation and advisory services associated with our systems and hardware placements.

Our diagnostic imaging systems capture radiographic images in digital form, replacing traditional x-ray film and the film development processes, which generally require the use of hazardous chemicals and darkrooms. We currently market and sell two diagnostic imaging systems primarily used in small animal veterinary applications: the IDEXX ImageVue DR50 and the IDEXX ImageVue DR30. The IDEXX ImageVue DR50 Plus, which launched in North America in January 2026, combines high definition, AI-powered imaging with a lower dose of radiation compared to our current IDEXX ImageVue DR50 system.

Water

Our strategy in the water testing business is to develop, manufacture, market, and sell products that test primarily for the presence of microbial contamination in water matrices, including drinking water supplies, with superior performance, supported by exceptional customer service. Our customers primarily consist of water utilities, government laboratories, and private certified laboratories that highly value strong relationships and customer support. We expect that future growth in this business will be partially dependent on our ability to increase international sales. Growth also will be dependent on our ability to enhance and broaden our product line. Most water microbiological testing is driven by regulation, and, in many countries, a test may not be used for compliance testing unless it has been approved by the applicable regulatory body and integrated into customers’ testing protocols. As a result, we maintain an active regulatory program that involves applying for a growing number of regulatory approvals in a number of countries, primarily in Europe. Further, we seek to receive regulatory approvals from governing agencies as a means to differentiate our products from the competition.

Livestock, Poultry and Dairy

We develop, manufacture, market, and sell a broad range of tests and perform services for various livestock diseases and conditions, and have active research and development and in-licensing programs in this area. Our strategy is to offer differentiated tests with superior performance characteristics for use in government programs to control or eradicate disease and disease outbreaks and in livestock and poultry producers’ disease, reproductive, and herd health and production management programs. Our Alertys Ruminant Pregnancy Test, Rapid Visual Pregnancy Test, and Alertys On-Farm Pregnancy Test for cattle can detect pregnancy 28 days after breeding. These tests provide a quick and accurate identifier using whole blood samples.

Disease outbreaks are episodic and unpredictable, and certain diseases that are prevalent at one time may be substantially contained or eradicated at a later time. In response to outbreaks, testing initiatives may lead to exceptional demand for certain products in certain periods. Conversely, successful eradication programs may result in significantly decreased demand for certain products. In addition, increases in government funding may lead to increased demand for certain products, and budgetary constraints may lead to decreased demand for certain products. As a result, the performance in certain sectors of this business can fluctuate.

Our strategy in the dairy testing business is to develop, manufacture, and sell antibiotic residue and contaminant testing products that satisfy applicable regulatory requirements or dairy processor standards for testing of milk and provide reliable field performance. The manufacture of these testing products leverages the SNAP platform and production assets that also support our rapid assay business, which also leverages the SNAP platform. The dairy SNAP products incorporate customized reagents for antibiotic and contaminant detection.

CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS

The discussion and analysis of our financial condition and results of operations is based upon the consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses, and related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis. We base our estimates on historical experience and on various assumptions that we believe 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. Actual results may differ from these estimates. Refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 2. Summary of Significant Accounting Policies” to the consolidated financial statements included in this Annual Report on Form 10-K for a description of the significant accounting policies used in preparation of these consolidated financial statements.

We believe the following critical accounting estimates and assumptions may have a material impact on reported financial condition and operating performance and involve significant levels of judgment to account for highly uncertain matters or are susceptible to significant change.

Revenue Recognition

Refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 3. Revenue” to the consolidated financial statements for the year ended December 31, 2025, included in this Annual Report on Form 10-K for additional information about our revenue recognition policy and criteria for recognizing revenue.

We enter into arrangements with multiple performance obligations where customers purchase a combination of IDEXX products and services. The total transaction price of the contractual arrangement is allocated to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. We recognize revenue as each performance obligation is satisfied, which is when control of the related goods or services is transferred, either at a point in time or over time.

We determine the transaction price for customer contractual arrangements based on the total consideration we expect to receive in exchange for the transferred goods or services. We apply judgment to estimate the transaction price that we expect to earn from multi-year customer contracts, including variable consideration such as certain customer rebates and other incentive payments, and price adjustments. Our estimates are based on historical and projected experience with similar customer contracts, predicted future customer purchases, expected price adjustments and incentive utilization over the term of these arrangements, changing trends and market conditions, and other relevant factors. Variable consideration is included in the estimated transaction price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. Differences between estimated and actual customer purchases may impact the timing and amount of revenue recognition during the term of the customer arrangement, and would affect revenue recognized in the period that such differences are incurred, but would not affect the total revenue recognized over a contract term. Although the timing of revenue recognition for these customer arrangements is dependent on estimates and assumptions, historically our adjustments to actual results have not been material. Changes to assumptions used to estimate transaction prices and differences between estimated and actual customer purchases are not reasonably likely to have a material effect on revenue recognized in any annual period or on revenue growth trends.

We determine standalone selling prices in order to allocate the expected consideration from a customer contract to the individual performance obligations. We utilize the observable standalone selling price when available, which represents the price charged for the promised product or service when sold separately. When standalone selling prices for our products or services are not directly observable, we determine the standalone selling prices for products and services using relevant information available and apply suitable estimation methods including, but not limited to, the cost plus a margin approach. We estimate the standalone selling prices for customers’ rights to earn rebates on optional future purchases that are determined to be material rights, which represent the expected value to the customers, based on our historical rebate experience, the contractual rebate structure and terms, and other relevant information. Changes in standalone selling prices would affect the allocation of customer consideration amongst performance obligations, but would not affect the total revenue recognized over a contract term. Changes to assumptions used to determine standalone selling prices are not reasonably likely to have a material effect on revenue recognized in any annual period or on revenue growth trends.

Income Taxes

We are subject to income taxes in the United States and numerous foreign jurisdictions. Significant estimates and judgments are required to determine our worldwide income tax provision, deferred tax assets and liabilities, and any valuation allowances recorded against net deferred tax assets. Substantial changes to our estimates could result in increases or decreases in our income tax provision in the period in which we make the changes, which could have a material impact on our effective tax rate and net income.

Deferred tax assets and liabilities represent the estimated future tax effects of temporary differences between book and tax treatment of assets and liabilities and carryforwards to the extent they are realizable. Significant judgment is required to evaluate the need for a valuation allowance against deferred tax assets. For those jurisdictions where tax carryforwards are likely to expire unused or the projected operating results indicate that realization is not more-likely-than-not, a valuation allowance is recorded to offset some or all of the deferred tax asset within that jurisdiction. We apply judgment to assess the recoverability of future tax deductions and credits by estimating future expected taxable income and considering prudent and feasible tax planning strategies available in the relevant jurisdiction. Our realizability assessments are made at a given balance sheet date and are subject to change in the future, particularly if earnings of a subsidiary are significantly higher or lower than expected, or if we take operational or tax planning actions that could impact the future taxable earnings of a subsidiary. If our judgment as to realizability changes, the effects of the change would be recognized in the period in which the change occurs.

Our net taxable temporary differences and tax carryforwards are recorded using the enacted tax rates expected to apply to taxable income in the periods in which the deferred tax liability or asset is expected to be settled or realized. Should the applicable tax rates change in the future, an adjustment to our deferred taxes would be credited or charged, as appropriate, to income in the period in which the tax rate change is enacted.

The calculation of our tax liabilities involves uncertainties in the application of complex tax laws and regulations and the potential for future adjustment of our uncertain tax positions by government tax authorities in various jurisdictions. We periodically assess our exposures related to our worldwide provision for income taxes and believe that we have appropriately accrued taxes for contingencies.

We record a liability for uncertain tax positions that do not meet the more-likely-than-not standard as prescribed by U.S. GAAP for income tax accounting. We record tax benefits for only those positions that we believe will more-likely-than-not be sustained. If our judgment as to the likely resolution of an uncertainty changes, if an uncertainty is ultimately settled, or if the statute of limitations related to an uncertainty expires, the effects of the change would be recognized in the period in which the change, resolution, or expiration occurs. Our net liability for uncertain tax positions was $12.7 million as of December 31, 2025, and $18.1 million as of December 31, 2024. We also accrue for estimated interest expense and penalties on our uncertain tax positions to the extent possible.

Refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 14. Income Taxes” in the accompanying Notes to consolidated financial statements for more information.

RECENT ACCOUNTING PRONOUNCEMENTS

Refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 2. Summary of Significant Accounting Policies (v) and (w)” to the consolidated financial statements for the year ended December 31, 2025, included in this Annual Report on Form 10-K for a complete discussion of recent accounting pronouncements adopted and not adopted.

RESULTS OF OPERATIONS AND TRENDS

Effects of Certain Factors on Results of Operations

Our financial results have been, and will continue to be, impacted by certain significant trends, including those which are described below. While these trends are important to understanding and evaluating our financial results, this discussion should be read in conjunction with our consolidated financial statements and related notes appearing elsewhere in this Annual Report on Form 10-K, and the other transactions, events, and trends discussed in “Part I, Item 1A. Risk Factors” included in this Annual Report on Form 10-K.

CAG Trends. Global trends in companion animal healthcare, including growth in demand for clinical services, continue to support growth for companion animal diagnostic products and services across regions. In the U.S., average diagnostics revenue per practice grew approximately 6% on a same-store basis during 2025, faster than approximately 2% growth in overall practice revenues. U.S. same-store clinical visits at veterinary practices declined approximately 2% in 2025, impacted by ongoing veterinary practice capacity challenges, as well as macroeconomic headwinds. Our initial 2026 financial outlook anticipates a similar decline in U.S. same-store clinical growth levels as in 2025, reflecting these near-term sector and macroeconomic dynamics. Our products and services include solutions that help improve staff productivity, create additional capacity at veterinary clinics, and engage and communicate with pet owners.

Supply Chain and Logistics Challenges. We believe that building and maintaining a well-managed and disciplined infrastructure has helped minimize impacts of supply chain constraints, including product and component availability issues; logistics challenges, including extended shipping periods and delays; and inflationary cost pressures. Our proactive approach to managing our operational processes, including forward planning with a focus on working closely with our suppliers and logistics partners, enables us to maintain continued high levels of product and service availability and customer service. We believe we are well-positioned to enable sustained high growth in our businesses and to effectively manage the impacts of potentially higher costs in certain areas to support these growth plans. However, there can be no assurance as to the duration or severity of the supply chain and logistics challenges or the effectiveness of our mitigation activities.

Effects of Economic Conditions. Demand for our products and services is vulnerable to changes in the economic environment, including slow economic growth, inflationary pressure, geopolitical events, tariffs, high unemployment, and credit availability. Negative or cautious consumer sentiment can lead to reduced or delayed consumer spending, resulting in a decreased number of patient visits to veterinary clinics or lower use of diagnostics. Unfavorable economic conditions can impact sales of instruments, diagnostic imaging, and practice management systems, which are larger capital purchases for veterinarians. In the U.S., we monitor patient visits and clinic revenue data provided by a subset of our CAG customers. Although this data is a limited sample, and may be susceptible to short-term impacts, we believe that this data provides a fair and meaningful long-term representation of the trend in patient visit activity in the U.S., providing us insight regarding demand for our products and services.

Economic conditions may also affect the purchasing decisions of our Water and LPD customers. Water testing volumes may be susceptible to declines in discretionary testing for existing home and commercial sales and in mandated testing as a result of decreases in home and commercial construction. In addition, fiscal difficulties can also reduce government funding for water and herd health screening services.

We believe that the diversity of our products and services and the geographic diversity of our customers partially mitigate the potential effects of the economic environment and negative consumer sentiment on our revenue growth rates.

Currency Impact. For the year ended December 31, 2025, approximately 23% of our consolidated revenue was derived from products manufactured or sourced in U.S. dollars and sold internationally in local currencies, compared to 22% and 21% for the years ended December 31, 2024, and December 31, 2023, respectively. Strengthening of the rate of exchange for the U.S. dollar relative to other currencies has a negative impact on our revenues derived in currencies other than the U.S. dollar and on profits of products manufactured or purchased in U.S. dollars and sold internationally, and a weakening of the U.S. dollar has the opposite effects. Similarly, to the extent that the U.S. dollar is stronger in current or future periods relative to the exchange rates in effect in the corresponding prior periods, our growth rate will be negatively affected. The impact of foreign currency denominated operating expenses and foreign currency denominated supply contracts partly offsets this exposure. Additionally, our designated hedges of intercompany inventory purchases and sales help delay the impact of certain exchange rate fluctuations on non-U.S. denominated revenues. Refer to “Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk” included in this Annual Report on Form 10-K for additional information regarding currency impact. Our future income tax expense could also be affected by changes in the mix of earnings, including as a result of changes in the rate of exchange for the U.S. dollar relative to currencies in countries with differing statutory tax rates. Refer to “Part I, Item 1A. Risk Factors” included in this Annual Report on Form 10-K for additional information regarding tax impacts.

Changes in Tariff and Trade Policies. We manufacture many of our companion animal and water quality products, as well as certain of our LPD testing products, in the United States. We rely on third-party suppliers located in the United States and other regions (such as Europe and Asia Pacific) for certain components, raw materials, and consumables used in or with our products. In addition, as a global business, our products and services are sold in more than 175 countries. For the year ended December 31, 2025, approximately 36% of our overall revenues were attributable to sales of products and services to customers outside the United States. Accordingly, changes in tariff and trade policies may adversely affect our business, financial condition, and operating results.

We aim to optimize operations and inventory management to help reduce the potential impact from changes in tariff and trade policies. However, imposed tariffs (including retaliatory tariffs) and our optimization activities may cause our cost of goods to increase, our profit margins to decrease, or our products to become less competitive or less available in the applicable region. We continue to monitor the dynamic trade environment and evaluate the potential impacts of changes in tariffs and trade policies, but there can be no assurance that any of our optimization activities will be successful in offsetting some portion of these costs or otherwise reducing the impact on our business, financial condition, and operating results.

Distributor Purchasing and Inventories. When selling our products through distributors, changes in distributors’ inventory levels can impact our reported sales, and these changes may be affected by many factors which may not be directly related to underlying demand for our products by veterinary practices. If during a quarter or year, distributors’ inventories grow by less than those inventories grew in the comparable period of the prior year, then changes in distributors’ inventories would have an unfavorable impact on our reported sales growth in the current period. Conversely, if during a quarter or year, distributors’ inventories grow by more than those inventories grew in the comparable period of the prior year, then changes in distributors’ inventories would have a favorable impact on our reported sales growth in the current period.

In certain countries, we sell our products through third-party distributors and may be unable to obtain data about sales to veterinary practices. We do not believe the impact of changes in these distributors’ inventories have had or would have a material impact on our growth rates. Refer to “Part I, Item 1. Business, Marketing and Distribution” included in this Annual Report on Form 10-K for additional information regarding distribution channels.

Effects of Patent Expiration. Although certain patents and licenses of patents and technologies from third parties periodically expire, the expiration of these patents or licenses, individually or in the aggregate, is not expected to have a material effect on our financial position or future operations due to a range of factors as described in “Part I, Item 1. Intellectual Property, Including Patents and License.”

Non-GAAP Financial Measures. The following revenue analysis and discussion includes organic revenue growth, and references in this analysis and discussion to “revenue,” “revenues,” or “revenue growth” apply equally to revenue growth reported in accordance with U.S. GAAP and to “organic revenue growth.” Organic revenue growth is a non-GAAP financial measure and represents the percentage change in revenue during the current year, compared to the same period for the prior year, net of the effect of changes in foreign currency exchange rates, certain business acquisitions, and divestitures. Organic revenue growth should be considered in addition to, and not as a replacement for, or as a superior measure to, revenue growth reported in accordance with U.S. GAAP, and may not be comparable to similarly titled measures reported by other companies. Management believes that reporting organic revenue growth provides useful information to investors by facilitating easier comparisons of our revenue performance with prior and future periods and to the performance of our peers.

We exclude from organic revenue growth the effect of changes in foreign currency exchange rates because changes in foreign currency exchange rates are not under management’s control, are subject to volatility, and can obscure underlying business trends. We calculate the impact on revenue resulting from changes in foreign currency exchange rates by applying the difference between the weighted average exchange rates during the current period and the comparable prior year period to foreign currency denominated revenues for the prior year period.

We also exclude from organic revenue growth the effect of certain business acquisitions and divestitures because the nature, size, and number of these transactions can vary dramatically from period to period, and because they either require or generate cash as an inherent consequence of the transaction, and therefore can also obscure underlying business and operating trends. We consider acquisitions to be a business when all three elements of inputs, processes, and outputs are present, consistent with ASU 2017-01, “Business Combinations: (Topic 805) Clarifying the Definition of a Business.” We do not consider acquired assets to be a business if substantially all the fair value of the assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. A typical acquisition that we do not consider a business is a customer list asset acquisition, which does not have all elements necessary to operate a business, such as employees or infrastructure. Revenue from these customers acquired is included in organic revenue growth because we believe the efforts required to convert and retain these acquired customers are similar in nature to our efforts to obtain and retain our existing customer base.

We also use Adjusted EBITDA, gross debt, net debt, gross debt to Adjusted EBITDA ratio, and net debt to Adjusted EBITDA ratio, all of which are non-GAAP financial measures that should be considered in addition to, and not as a replacement for, financial measures presented according to U.S. GAAP. Management believes that reporting these non-GAAP financial measures provides supplemental analysis to help investors further evaluate our business performance and available borrowing capacity under our Credit Facility.

Segment Income from Operations. We report segment income from operations in our discussion of the results of the operations of our segments below. Segment income from operations is a non-GAAP financial measure that adjusts for the impact of foreign currency transaction gains and losses and should be considered in addition to, and not as a replacement for, or superior measure to, income from operations. We exclude foreign currency transaction gains and losses for each reportable segment (CAG, Water, and LPD) from segment income from operations and report the full amount of foreign currency transaction gains and losses in Other. We believe that reporting segment income from operations provides supplemental analysis to help investors further evaluate each reportable segment’s business performance by excluding foreign currency transaction gains and losses, which are centrally managed by our corporate treasury function and which we do not consider relevant for assessing the results of each reportable segment’s operations.

The reconciliation of these non-GAAP financial measures is as follows:

(dollars in thousands)

Comparisons to Prior Periods. Our fiscal years end on December 31. Unless otherwise stated, the analysis and discussion of our financial condition, results of operations and liquidity, including references to growth and organic growth and increases and decreases, are being compared to the equivalent prior year period.

Twelve Months Ended December 31, 2025, Compared to Twelve Months Ended December 31, 2024

Total Company

The following table presents revenue by operating segment by U.S. and non-U.S., or international, geographies:

(1) Reported revenue growth and organic revenue growth may not recalculate due to rounding.

Total Company Revenue. The increase in revenue primarily reflected growth in CAG Diagnostics recurring revenue, including benefits from higher volumes and higher realized prices. Volume growth was supported by new business gains, our expanded menu of available tests, and higher utilization in our loyal customer base, partially constrained by macroeconomic and sector headwinds. Instrument revenue gains were primarily due to the placements of our new IDEXX inVue Dx Analyzer. Higher volume and price gains in recurring veterinary software, services, and diagnostic imaging also contributed to revenue growth. Higher revenue in our Water business was primarily due to the benefits from higher realized prices and higher volumes. The increase in LPD revenue was primarily due to higher volumes and higher realized prices. The impact from changes in foreign currency exchange rates increased total revenue growth by 0.8%.

The following table presents our consolidated Company results of operations:

Gross Profit. Gross profit increased due to higher revenue and an 80 basis point increase in the gross profit margin. The net increase in the gross profit margin reflected benefits from recurring revenue growth in IDEXX VetLab consumable and reference laboratory testing volumes, along with operational productivity and pricing benefits, which offset the impacts from higher product and labor costs due to, in part, inflationary cost effects. These increases in the gross profit margin were reduced by the business mix impact from higher instrument revenue. The impact from changes in foreign currency exchange rates on the gross profit margin was not significant, including the impact of hedge losses in the current year compared to hedge gains in the prior year.

Operating Expenses. Sales and marketing expense increased primarily due to higher personnel-related costs and higher expenses to support marketing outreach activities. General and administrative expense decreased primarily due to a $61.5 million expense in the prior year and a reduction in accrued expense of approximately $9 million in the first quarter of the current year, related to a now-concluded litigation matter, partially offset by higher personnel-related and information technology and security costs. Research and development expense increased due to development project costs for new products and services, including higher personnel-related costs. The impact from changes in foreign currency exchange rates increased operating expense growth by less than 1%.

Companion Animal Group

The following table presents revenue by product and service category for CAG:

CAG Diagnostics Recurring Revenue. The increase in CAG Diagnostics recurring revenue was primarily due to higher volumes of IDEXX VetLab consumables and reference laboratory testing, partially constrained by macroeconomic and sector headwinds, as well as benefits from higher realized prices. Volume growth was supported by new business gains, our expanded menu of available tests, and higher utilization in our loyal customer base. The impact from changes in foreign currency exchange rates increased CAG Diagnostics recurring revenue growth by 0.8%.

The increase in IDEXX VetLab consumables revenue was primarily due to higher volumes and higher realized prices. Volume gains were supported by increases in testing, including the benefits from 12% growth in our installed base of premium instruments, which reflected new customers and continued high customer retention rates, as well as our expanded menu of available tests. The impact from changes in foreign currency exchange rates increased revenue growth by 1.1%.

The decrease in rapid assay revenue resulted primarily from a shift of customers’ pancreatic lipase testing to our Catalyst instrument platform and macroeconomic and sector headwinds, partially offset by higher realized prices.

The increase in reference laboratory diagnostic and consulting services revenue was due to higher testing volumes in North America, Europe, and Asia Pacific and higher realized prices. The impact from changes in foreign currency exchange rates increased revenue growth by 0.7%.

The increase in CAG Diagnostics services and accessories revenue was primarily a result of the expansion of our installed base of premium instruments. The impact from changes in foreign currency exchange rates increased revenue growth by 1.0%.

CAG Diagnostics Capital – Instrument Revenue. The increase in instrument revenue was primarily due to placements of our new IDEXX inVue Dx Analyzer, partially offset by lower placements of other premium instruments. The impact from changes in foreign currency exchange rates increased revenue growth by 2.5%.

Veterinary Software, Services, and Diagnostic Imaging Systems Revenue. The increase in recurring revenue was primarily due to higher subscription and support services volume from our expanded SaaS installed base and higher realized prices. The increase in our systems and hardware revenue was primarily due to higher diagnostic imaging system sales. The impact of a business acquisition increased overall Veterinary Software, Services, and Diagnostic Imaging Systems revenue growth by 0.4%.

The following table presents the CAG segment results of operations:

Gross Profit. Gross profit increased primarily due to higher revenue and a 90 basis point increase in the gross profit margin. The net increase in the gross profit margin reflected benefits from recurring revenue growth in IDEXX VetLab consumable and reference laboratory testing volumes, along with operational productivity and pricing benefits, which offset the impacts from higher product and labor costs due to, in part, inflationary cost effects. These increases in the gross profit margin were reduced by the business mix impact from higher instrument revenue. The impact from changes in foreign currency exchange rates on the gross profit margin was not significant, including the impact of lower hedge gains in the current year, compared to the prior year.

Segment Operating Expenses. Sales and marketing expense increased primarily due to higher personnel-related costs and higher expenses to support marketing outreach activities. General and administrative expense decreased primarily due to a $61.5 million expense in the prior year and a reduction in accrued expense of approximately $9 million in the first quarter of the current year, related to a now-concluded litigation matter, partially offset by higher personnel-related and information technology and security costs. Research and development expense increased due to development project costs for new products and services, including higher personnel-related costs. The impact from changes in foreign currency exchange rates increased operating expense growth by less than 1%.

Water

The following table presents the Water segment results of operations:

Revenue. The increase in revenue was primarily due to higher realized prices and higher volumes. The increase in volumes was due to higher testing volumes in Europe, North America, and Asia Pacific, as well as higher sales volumes of our Tecta systems, our new UV Viewer Plus, and accessories. The impact from changes in foreign currency exchange rates increased revenue growth by 0.6%.

Gross Profit. The increase in gross profit for Water was primarily due to higher revenue, partially offset by a 100 basis point decrease in the gross profit margin. The net decrease in the gross profit margin was due to higher product and distribution costs, partially offset by higher realized prices. The impact from changes in foreign currency exchange rates decreased the gross profit margin by approximately 20 basis points, including the impact of lower hedge gains in the current year, compared to the prior year.

Segment Operating Expenses. Sales and marketing expense increased primarily due to higher personnel-related and higher trade show and sales meeting costs. General and administrative expense decreased primarily due to lower personnel-related costs and lower bad debt expense. Research and development expense increased primarily due to higher personnel-related costs, partially offset by lower project costs. The impact from changes in foreign currency exchange rates was not significant to operating expense growth.

Livestock, Poultry and Dairy

The following table presents the LPD segment results of operations:

Revenue. The increase in revenue was primarily due to volume growth in the Americas and Asia Pacific, and higher realized prices. The impact from changes in foreign currency exchange rates increased revenue growth by 1.8%.

Gross Profit. The increase in LPD gross profit was primarily due to higher revenues, partially offset by a 260 basis point decrease in the gross profit margin. The net decrease in the gross profit margin was primarily due to higher product costs, partially offset by higher realized prices and manufacturing efficiencies. The impact from changes in foreign currency exchange rates decreased the gross profit margin by approximately 90 basis points, including the impact of hedge losses in the current year, compared to hedge gains in the prior year.

Segment Operating Expenses. Sales and marketing expense increased primarily due to higher personnel-related and higher trade show and sales meeting costs. General and administrative expense increased primarily due to higher bad debt expense and personnel-related costs. Research and development expense increased primarily due to higher personnel-related costs in the current year. The impact from changes in foreign currency exchange rates increased operating expense growth by approximately 1%.

Non-Operating Items

Interest Expense and Income. Interest expense was $38.9 million for the year ended December 31, 2025, compared to $31.2 million for the prior year. The increase in interest expense was primarily due to higher average debt levels and higher interest rates. Interest income was $3.0 million for the year ended December 31, 2025, compared to $12.7 million for the prior year. This decrease in interest income is primarily due to a decrease in money market investments.

Provision for Income Taxes. Our effective income tax rates were 20.0% for the years ended December 31, 2025, and December 31, 2024. Our effective tax rate for the year ended December 31, 2025, was consistent with the prior year; the impact from an increase in tax benefits related to share-based compensation was largely offset by a reduction in our U.S. tax benefit associated with Foreign-Derived Intangible Income resulting from the acceleration of research and development deductions as allowed by recent U.S. tax law changes. Our projected effective tax rate for 2026 is approximately 21.3%. This increase in the projected 2026 effective tax rate is primarily due to estimated reductions in share-based compensation tax benefits, as compared to 2025.

LIQUIDITY AND CAPITAL RESOURCES

We fund the capital needs of our business through cash on hand, funds generated from operations, proceeds from long-term senior note financings, and amounts available under our Credit Facility. We generate cash primarily through the payments made by customers for our companion animal, livestock, poultry, dairy, and water products and services, consulting services, and other various systems and services. Our cash disbursements are primarily related to compensation and benefits for our employees, inventory and supplies, repurchase of our common stock, taxes, research and development, capital expenditures, rents, occupancy-related charges, interest expense, and business acquisitions. As of December 31, 2025, we had $180.1 million of cash and cash equivalents, compared to $288.3 million as of December 31, 2024. Working capital totaled $265.0 million as of December 31, 2025, compared to $332.0 million as of December 31, 2024. The change in working capital is primarily due to lower cash and higher borrowings on our Credit Facility, partially offset by higher receivables and lower outstanding borrowing on the current portion of our Senior Notes, as compared to the prior year. As of December 31, 2025, we had a remaining borrowing availability of $850.2 million under our $1.25 billion Credit Facility, with $398.0 million in outstanding borrowings under our Credit Facility, and an option for the Company to incur incremental revolving credit commitments and/or term loans in the aggregate principal amount of up to $250.0 million. The general availability of funds under our Credit Facility is reduced by $1.8 million for outstanding letters of credit. We believe that, if necessary, we could obtain additional borrowings to fund our growth objectives. We further believe that current cash and cash equivalents, funds generated from operations, and committed borrowing availability will be sufficient to fund our operations, capital purchase requirements, and anticipated growth needs for the next twelve months. We believe that these resources, coupled with our ability, as needed, to incur incremental revolving credit commitments and/or term loans under our Credit Facility and otherwise obtain additional financing, will also be sufficient to fund our business as currently conducted for the foreseeable future. We may enter into new financing arrangements or refinance or retire existing debt in the future depending on market conditions. Should we require more capital in the U.S. than is generated by our operations, for example to fund significant discretionary activities, we could elect to raise capital in the U.S. through the incurrence of debt or equity issuances, which we may not be able to complete on favorable terms or at all. In addition, these alternatives could result in increased interest expense or other dilution of our earnings.

We manage our worldwide cash requirements considering available funds among all of our subsidiaries. Our foreign cash and cash equivalents are generally available without restrictions to fund ordinary business operations outside the U.S.

The following table presents cash, cash equivalents, and marketable securities held domestically and by our foreign subsidiaries:

As of December 31, 2025, more than 99% of the cash and cash equivalents held were held as bank deposits at a diversified group of institutions, primarily systemically important banks. Cash and cash equivalents as of December 31, 2025, included approximately USD $1.0 million in cash denominated in non-U.S. currencies held in a country with currency control restrictions, which limit our ability to transfer funds outside of the country in which they are held without incurring costs. The currency control restricted cash is generally available for use within the country where it is held.

The following table presents additional key information concerning working capital:

(1) Days sales outstanding represents the average of the accounts receivable balances at the beginning and end of each quarter divided by revenue for that quarter, the result of which is then multiplied by 91.25 days.

(2) Inventory turns are calculated as the ratio our inventory-related cost of revenue for the quarter multiplied by four, divided by the average inventory balances at the beginning and end of each quarter.

Sources and Uses of Cash

The following table presents cash provided (used):

(in thousands)

Operating Activities. Cash provided by operating activities during the year ended December 31, 2025, was $1.2 billion, which was a net increase in operating cash flows of $252.8 million, compared to the prior year. Cash was provided from net income of $1.1 billion, adjusted for net non-cash items of $349.9 million, partially offset by a net decrease from changes in operating assets and liabilities of $227.5 million.

The following table presents cash flow impacts from changes in operating assets and liabilities, excluding the effects of foreign exchange rate fluctuations:

(in thousands)

Cash used due to changes in operating assets and liabilities during the year ended December 31, 2025, compared to the prior year, increased $94.3 million. Cash used for other assets and liabilities increased $75.7 million, compared to the prior year. During 2025, we paid approximately $80 million, which was accrued in prior years, to conclude a litigation matter, and the payment is included within the cash flow impacts from changes in other assets and liabilities. Cash used to fund contract assets and consideration paid to customers arising from customer commitment arrangements also increased in 2025, compared to the prior year. Increases in cash used for other assets and liabilities were partially offset by lower tax payments and lower annual employee incentive program payments in 2025. Cash used for accounts receivable increased $40.4 million, compared to the prior year, primarily due to the timing of customer payments received and higher revenue.

We have historically experienced proportionally lower net cash flows from operating activities during the first quarter and proportionally higher cash flows from operating activities for the remainder of the year and for the annual period, driven primarily by payments related to annual employee incentive programs in the first quarter following the year for which the bonuses were earned.

Investing Activities. Cash used by investing activities was $136.2 million during 2025, compared to $207.1 million used during 2024. The decrease in cash used by investing activities during 2025, compared to 2024, was primarily due to the acquisition of a software business during the prior year.

Our projected capital expenditures for 2026 are estimated to be approximately $180.0 million, which includes capital investments in manufacturing and operations facilities to support growth, as well as investments in customer-facing software development.

Financing Activities. Cash used by financing activities was $1.2 billion during 2025, compared to $878.1 million used during 2024. The increase in cash used was primarily due to an increase of $379.9 million in cash used to repurchase shares of our common stock during 2025, compared to 2024, as well as the repayment in full upon the maturity of our 2025 Series C Notes for $103.4 million, and the repayment in full upon maturity of our 2025 Series B Notes for $75.0 million. These increases in cash used by financing were partially offset by borrowings of $148.0 million under our Credit Facility during 2025, compared to no borrowings or repayments under our Credit Facility during the prior year, and the repayment in full upon the maturity of our 2024 Series B Notes during the prior year for $75.0 million.

Repurchases of our common stock vary depending upon the level of other investing and deployment activities, as well as share price and prevailing interest rates. We believe that the repurchase of our common stock is a favorable means of returning value to our stockholders, and we also repurchase our stock to offset the dilutive effect of our share-based compensation programs. We primarily fund our share repurchases with cash generated from operations, as well as from various capital market activities, including the committed available financing through our Credit Facility. Refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 20. Repurchases of Common Stock” for additional information about our share repurchases. We currently anticipate a 1% to 2% reduction in diluted shares through share repurchases in 2026, subject to market conditions.

The aggregate principal amount of our 2026 Senior Notes will become due and payable on September 4, 2026. We anticipate funding the full repayment of our 2026 Senior Notes for $75.0 million when due in September 2026 with available cash on hand, borrowings under our Credit Facility, or proceeds from the issuance of new notes, or a combination thereof.

The obligations under our senior notes may be accelerated upon the occurrence of an event of default under the applicable Senior Note Agreements, each of which includes customary events of default including payment defaults, defaults in the performance of the affirmative, negative and financial covenants, the inaccuracy of representations or warranties, bankruptcy and insolvency-related defaults, defaults relating to judgments, certain events related to employee pension benefit plans under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), the failure to pay specified indebtedness, and a change of control default.

Under the $1.25 billion Credit Facility, the $1.0 billion unsecured credit line matures on November 12, 2030, the $250.0 million Term Loan matures on November 12, 2028, and no scheduled principal prepayments are required before these respective dates. Our Credit Facility also includes an option for the Company to incur incremental revolving credit commitments and/or term loans in the aggregate principal amount of up to $250.0 million. Our Credit Facility contains affirmative, negative, and financial covenants customary for financings of this type. The applicable interest rate for borrowings in U.S. Dollars under our Credit Facility is calculated at a per annum rate equal to either (at our option) (1) a base rate (determined as the greatest of the prime rate, the NYFRB Rate plus 0.50%, and the Adjusted Term SOFR Rate for a one-month Interest Period plus 1.0% (but no less than 1.0%)), plus a margin rate ranging from 0.0% to 0.375% based on our consolidated leverage ratio, (2) the Adjusted Term SOFR Rate, plus a margin rate ranging from 0.875% to 1.375% based on our consolidated leverage ratio, or (3) the Adjusted Daily Simple SOFR Rate, plus a margin rate ranging from 0.875% to 1.375% based on our consolidated leverage ratio. Refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 13, Debt” for additional information about our applicable interest rates on our Credit Facility. Under our Credit Facility, we also pay on a quarterly basis commitment fees ranging from 0.075% to 0.25% per annum, based on our consolidated leverage ratio, on any unused commitment.

As of December 31, 2025, we had $398.0 million in borrowings outstanding under our Credit Facility, of which $250.0 million was on our Term Loan under our Credit Facility. As of December 31, 2024, we had $250.0 million in borrowings outstanding under our Credit Facility, all of which was on our $250.0 million Term Loan under our Credit Facility. The general availability of funds under our Credit Facility was further reduced by $1.8 million and $1.9 million for letters of credit that were issued primarily in connection with our workers' compensation policy as of December 31, 2025, and December 31, 2024, respectively. Our Credit Facility contains affirmative, negative, and financial covenants customary for financings of this type. The negative covenants include restrictions on liens, indebtedness of subsidiaries of the Company, fundamental changes, investments, transactions with affiliates, certain restrictive agreements, and violations of sanctions laws and regulations. The financial covenant is a consolidated leverage ratio test that requires our ratio of debt to earnings before interest, taxes, depreciation, amortization, and share-based compensation not to exceed 3.5-to-1. As of December 31, 2025, we were in compliance with the covenants of our Credit Facility. The obligations under our Credit Facility may be accelerated upon the occurrence of an event of default under our Credit Facility, which includes customary events of default including payment defaults, defaults in the performance of the affirmative, negative and financial covenants, the inaccuracy of representations or warranties, bankruptcy and insolvency related defaults, defaults relating to judgments, certain events related to employee pension benefit plans under ERISA, the failure to pay specified indebtedness, and a change of control default.

Refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 13, Debt” for additional information about our Senior Notes, Senior Note Agreements, and Credit Facility.

Effect of Currency Translation on Cash. The net effects of changes in foreign currency exchange rates are related to changes in exchange rates between the U.S. dollar and the functional currencies of our foreign subsidiaries with non-U.S. dollar functional currencies. These changes will fluctuate each year as the value of the U.S. dollar relative to the value of foreign currencies changes. The value of a currency depends on many factors, including interest rates, and the issuing governments' debt levels and strength of economy.

Off-Balance Sheet Arrangements. We have no off-balance sheet arrangements or variable interest entities except for letters of credit and third-party guarantees, as reflected in “Part II, Item 8. Financial Statements and Supplementary Data, Note 13 Debt” and “Part II, Item 8. Financial Statements and Supplementary Data. Note 16. Commitments, Contingencies and Guarantees” to the consolidated financial statements for the year ended December 31, 2025, included in this Annual Report on Form 10-K, respectively.

Financial Covenant. The financial covenant is a consolidated leverage ratio test that requires our ratio of debt to earnings before interest, taxes, depreciation, amortization, and share-based compensation, as defined in the Senior Note Agreements and Credit Facility, not to exceed 3.5-to-1. As of December 31, 2025, we were in compliance with the covenants of the Senior Note Agreements and Credit Facility. The following details our consolidated leverage ratio calculation:

(in thousands)

56

Commitments, Contingencies and Guarantees

For more information regarding our commitments, contingencies, and guarantees, refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 16. Commitments, Contingencies and Guarantees.”

For more information on our future lease payments, refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 8. Lease Commitments” for our minimum lease payment schedule. The expected timing of payments of our leases may be different in future years, depending on decisions to extend lease terms and/or enter into additional leases in the preceding years.

For more information on our future Swiss defined benefit pension plans payments, refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 23. IDEXX Retirement and Incentive Savings Plan” for our future benefits expected to be paid.

As of December 31, 2025, current liabilities include $398.0 million in outstanding borrowings under our Credit Facility and the current portion of long-term debt of $75.0 million recorded as current liabilities. Refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 13. Debt” for more information about our Credit Facility and Senior Notes.

We also have purchase obligations that include agreements and purchase orders to purchase goods or services that are contractually enforceable and that specify all significant terms, including fixed or minimum quantities, pricing, and approximate timing of purchases. As of December 31, 2025, we had approximately $207.3 million in purchase obligations due in 2026. Our purchase obligations beyond 2026 are approximately $136.7 million. These purchase obligation amounts do not include amounts recorded in accounts payable as of December 31, 2025. The expected timing of payments of our purchase obligations is estimated based on current information. Timing of payments and actual amounts paid may be different, depending on the time of receipt of goods or services, or changes to agreed-upon amounts for some obligations.

Additionally, we have agreements with third parties that we have entered into in the ordinary course of business under which we are obligated to indemnify such third parties for and against various risks and losses. The precise terms of such indemnities vary with the nature of the agreement. In many cases, we limit the maximum amount of our indemnification obligations, but in some cases those obligations may be theoretically unlimited. We have not incurred material expenses in discharging any of these indemnification obligations, and, based on our analysis of the nature of the risks involved, we believe that the fair value of these agreements is minimal. Accordingly, we did not record any liabilities for these obligations as of December 31, 2025, and 2024, and do not anticipate any future payments for these guarantees.

Our market risk consists primarily of foreign currency exchange risk, interest rate risk, and effects of inflation. Our functional currency is the U.S. dollar and our primary manufacturing operations and inventory supply contracts are in the U.S. or in U.S. dollars, but we distribute our products worldwide both through direct export and through our foreign subsidiaries. Our primary foreign currency transaction risk consists of intercompany purchases and sales of products, and we attempt to mitigate this risk through our hedging program described below. For the year ended December 31, 2025, approximately 23% of our consolidated revenue was derived from products manufactured or sourced in U.S. dollars and sold internationally in local currencies, compared to 22% and 21% for the years ended December 31, 2024 and 2023, respectively. The functional currency of most of our subsidiaries is their local currency.

Our foreign currency exchange impacts are comprised of three components: 1) local currency revenues and expenses; 2) the impact of hedge contracts; and 3) intercompany and monetary balances for our subsidiaries that are denominated in a currency that is different from the functional currency used by each subsidiary.

The following table presents the estimated foreign currency exchange impact on our revenues, operating profit, and diluted earnings per share for the current period and compared to the respective prior-year period:

(in thousands, except per share amounts)

At our current foreign exchange rate assumptions, we anticipate year-over-year changes will increase our revenues, operating profit, and diluted earnings per share in the year ending December 31, 2026, by approximately $28 million, $22 million, and $0.22 per share, respectively. These favorable impacts to our operating profit and diluted earnings per share include net year-over-year impacts of foreign currency hedging activity, which is expected to increase total company operating profit by approximately $4 million and diluted earnings per share by $0.04 during the year ending December 31, 2026. The actual impact of changes in the value of the U.S. dollar against foreign currencies in which we transact may materially differ from our expectations described above. The above estimates assume that the value of the U.S. dollar relative to other currencies will reflect the euro at $1.16, the British pound at $1.33, the Canadian dollar at $0.72, the Australian dollar at $0.66; the Japanese yen at ¥157, the Chinese renminbi at RMB 7.05, and the Brazilian real at R$5.45 to the U.S. dollar for the full year of 2026.

The foreign currency exchange impacts on our revenue and operating income for the year ending December 31, 2026, will be different from our estimates if actual foreign exchange rates are different from our assumptions. Excluding the impact of intercompany and trade balances denominated in currencies other than the functional subsidiary currencies, a 1% strengthening of the U.S. dollar would reduce revenue by approximately $16 million and operating income by approximately $5 million, net of hedge positions.

The primary purpose of our foreign currency hedging activities is to protect against the volatility associated with foreign currency transactions. We also utilize natural hedges to mitigate our transaction and commitment exposures. Our corporate policy prescribes the range of allowable hedging activity. We enter into foreign currency exchange contracts with large, well-capitalized multinational financial institutions, and we do not hold or engage in transactions involving derivative instruments for purposes other than risk management. Our accounting policies for these contracts are based on our designation of such instruments as hedging transactions. If a hedging instrument qualifies for hedge accounting, changes in the fair value of the hedging instrument from the effective portion of the hedge are deferred in accumulated other comprehensive income, net of tax, and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. We immediately record in earnings the extent to which a hedge instrument is not effective in achieving offsetting changes in fair value. We primarily utilize foreign currency exchange contracts with durations of less than 24 months.

Our subsidiaries enter into foreign currency exchange contracts to manage the exchange risk associated with their forecasted intercompany inventory purchases and sales for the next year. From time to time, we may also enter into other foreign currency exchange contracts, cross currency swaps, or foreign-denominated debt issuances to reduce the impact of foreign currency fluctuations associated with specific balance sheet exposures, including net investments in certain foreign subsidiaries. Refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 19. Hedging Instruments” to the consolidated financial statements of this Annual Report on Form 10-K for details regarding euro-denominated notes that we designated as a hedge of our euro net investment in certain foreign subsidiaries.

Our foreign currency hedging strategy is consistent with prior periods, and there were no material changes in our market risk exposure during the year ended December 31, 2025. We enter into foreign currency exchange contracts designated as cash flow hedges for amounts that are less than the full value of forecasted intercompany purchases and sales and for amounts that are equivalent to, or less than, other significant transactions. As a result, no significant ineffectiveness has resulted or been recognized in the statements of income for the years ended December 31, 2025, 2024, and 2023. Our hedging strategy related to intercompany inventory purchases and sales is to employ the full amount of our hedges for the succeeding year at the conclusion of our budgeting process for that year. Quarterly, we enter into contracts to hedge incremental portions of anticipated foreign currency transactions for the current and following year. As a result, our risk with respect to foreign currency exchange rate fluctuations may vary throughout each annual cycle.

We enter into hedge agreements where we believe we have meaningful exposure to foreign currency exchange risk, with the exception of certain emerging markets where it is not practical to hedge our exposure. We target to hedge approximately 75% to 85% of the estimated exposure from intercompany product purchases and sales denominated in the euro, British pound, Canadian dollar, Japanese yen, and Australian dollar. We have additional unhedged foreign currency exposures related to intercompany foreign transactions and in emerging markets where it is not practical to hedge. The notional amount of foreign currency exchange contracts to hedge forecasted intercompany purchases and sales totaled $397.6 million and $325.7 million, as of December 31, 2025 and 2024, respectively. As of December 31, 2025, we had $2.5 million of net unrealized losses on foreign currency exchange contracts reflected within accumulated other comprehensive income, net of related tax. For more information on our hedge agreements, refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 19. Hedging Instruments.”

For additional information, refer to “Part I, Item 1A. Risk Factors:” “Since our business is global in nature, geopolitical risks and other risks associated with doing business internationally could negatively affect our business, financial condition, and operating results” and “Strengthening of the rate of exchange for the U.S. dollar has a negative effect on our business,” and “Part II, Item 8. Financial Statements and Supplementary Data, Note 2. Summary of Significant Accounting Policies.”

Interest Rate Risk and Effects of Inflation

We incur interest expense on the aggregate principal amount of our outstanding Senior Notes at a fixed rate. We have a revolving credit facility with a syndicate of multinational banks, which matures on November 12, 2030, and requires no scheduled prepayments before that date. Although the revolving credit facility does not mature until November 2030, all individual borrowings under our Credit Facility have a stated term of less than 1 year, including the $250.0 million Term Loan, which matures on November 12, 2028.

We entered into interest rate swaps to reduce the effect of variable interest obligations of our Term Loan. As of December 31, 2025, the variable interest rate associated with $250.0 million Term Loan became effectively fixed at 3.4%, plus the applicable credit spread, through November 12, 2028. Borrowings outstanding under our Credit Facility as of December 31, 2025, were $398.0 million.

During 2025, we experienced inflationary pressure on our operating costs. During 2026, we expect to continue to face higher costs for labor, commodities, energy, and transportation, as well as increased prices from suppliers. Furthermore, additional tariffs on imported goods may increase our costs to purchase products, components, and materials. We may not be able to offset these higher costs through productivity initiatives and price increases, which may materially and adversely affect our business, results of operations, and financial condition. Any price increases we may impose may lead to declines in sales volume or loss of business, if competitors do not similarly adjust their prices, or customers refuse to purchase at the higher prices.

Disclosure Controls and Procedures

Our management is responsible for establishing and maintaining disclosure controls and procedures, as defined by the SEC in its Rules 13a-15(e) and 15d-15(e) under the Exchange Act. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of December 31, 2025, our Chief Executive Officer and Chief Financial Officer have concluded that, as of such date, the Company’s disclosure controls and procedures were effective at the reasonable assurance level.

Report of Management on Internal Control Over Financial Reporting

We are responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. The Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP and includes those policies and procedures that:

• Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company;
• Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and
• Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material adverse effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to risk that controls may become inadequate because of changes in conditions and that the degree of compliance with the policies and procedures may deteriorate.

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of internal control over financial reporting based on the framework in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our management concluded that, as of December 31, 2025, our internal control over financial reporting was effective.

The effectiveness of the Company's internal control over financial reporting as of December 31, 2025, has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears herein.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended December 31, 2025, that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Certifications

The certifications with respect to disclosure controls and procedures and internal control over financial reporting of the Company’s Chief Executive Officer and Chief Financial Officer are attached as Exhibits 31.1 and 31.2 to this Annual Report on Form 10-K.