# Vishay Precision Group, Inc.: Form 10-Q for the period ended Jun 28, 2025

- Company: [Vishay Precision Group, Inc.](/companies/vpg.md) (CIK 1487952)
- Form: 10-Q
- Filed: 2025-08-05
- Accepted by EDGAR: Aug 5, 2025, 10:06 ET
- Period: 2025-06-28
- Accession: 0001437749-25-024734
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1487952/000143774925024734/vpg20250628_10q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1487952/000143774925024734/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-06-28.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2025-03-30 to 2025-06-28 | $75.2m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Revenue | 6 months, 2025-01-01 to 2025-06-28 | $146.9m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Cost of revenue | 3 months, 2025-03-30 to 2025-06-28 | $44.6m | us-gaap:CostOfRevenue |
| Cost of revenue | 6 months, 2025-01-01 to 2025-06-28 | $89.3m | us-gaap:CostOfRevenue |
| Gross profit | 3 months, 2025-03-30 to 2025-06-28 | $30.6m | us-gaap:GrossProfit |
| Gross profit | 6 months, 2025-01-01 to 2025-06-28 | $57.6m | us-gaap:GrossProfit |
| Research and development | 3 months, 2025-03-30 to 2025-06-28 | $5.4m | us-gaap:ResearchAndDevelopmentExpense |
| Research and development | 6 months, 2025-01-01 to 2025-06-28 | $10.3m | us-gaap:ResearchAndDevelopmentExpense |
| Selling, general and administrative | 3 months, 2025-03-30 to 2025-06-28 | $27.7m | us-gaap:SellingGeneralAndAdministrativeExpense |
| Selling, general and administrative | 6 months, 2025-01-01 to 2025-06-28 | $54.4m | us-gaap:SellingGeneralAndAdministrativeExpense |
| Operating income | 3 months, 2025-03-30 to 2025-06-28 | $2.7m | us-gaap:OperatingIncomeLoss |
| Operating income | 6 months, 2025-01-01 to 2025-06-28 | $2.6m | us-gaap:OperatingIncomeLoss |
| Interest expense | 3 months, 2025-03-30 to 2025-06-28 | $550.0k | us-gaap:InterestExpenseNonoperating |
| Interest expense | 6 months, 2025-01-01 to 2025-06-28 | $1.1m | us-gaap:InterestExpenseNonoperating |
| Income tax | 3 months, 2025-03-30 to 2025-06-28 | $592.0k | us-gaap:IncomeTaxExpenseBenefit |
| Income tax | 6 months, 2025-01-01 to 2025-06-28 | $260.0k | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2025-03-30 to 2025-06-28 | $248.0k | us-gaap:NetIncomeLoss |
| Net income | 6 months, 2025-01-01 to 2025-06-28 | −$694.0k | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2025-03-30 to 2025-06-28 | $0.02 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 6 months, 2025-01-01 to 2025-06-28 | −$0.05 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2025-03-30 to 2025-06-28 | $0.02 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 6 months, 2025-01-01 to 2025-06-28 | −$0.05 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2025-03-30 to 2025-06-28 | 13,309,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 6 months, 2025-01-01 to 2025-06-28 | 13,259,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 6 months, 2025-01-01 to 2025-06-28 | $11.2m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 6 months, 2025-01-01 to 2025-06-28 | $2.8m | us-gaap:PaymentsToAcquireProductiveAssets |
| Share repurchases | 6 months, 2025-01-01 to 2025-06-28 | $0 | us-gaap:PaymentsForRepurchaseOfCommonStock |
| Cash and equivalents | at 2025-06-28 | $90.4m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2025-06-28 | $252.9m | us-gaap:AssetsCurrent |
| Total assets | at 2025-06-28 | $465.6m | us-gaap:Assets |
| Current liabilities | at 2025-06-28 | $58.1m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2025-06-28 | $134.3m | us-gaap:Liabilities |
| Long-term debt | at 2025-06-28 | $31.5m | us-gaap:LongTermDebtNoncurrent |
| Shareholders' equity | at 2025-06-28 | $331.2m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 54,462 characters.

### Overview

VPG is a global leader in precision measurement and sensing technologies that help power the future by bridging the physical world with the digital one. Many of our specialized sensors, weighing solutions, and measurement systems are “designed-in” by our customers, and address growing applications across a diverse array of industries and markets. Our products are marketed under brand names that we believe are characterized as having a very high level of precision and quality, and we employ an operationally diversified structure to manage our businesses.

Driven by the continued proliferation of data generated by the expanding use of sensors across a widening array of industrial and non-industrial applications, precision measurement and sensing technologies help ensure and deliver required levels of quality of mission-critical or high-value data. VPG’s products are often at the first stage of a data value chain (i.e., the process of converting the physical world into a digital format that can be used for a specific purpose) and as such impact the effectiveness of vast number of critical, high-value downstream processes. Over the past few years, we have seen a broadening of precision sensing applications in both our traditional industrial markets and new markets, due to the development of higher functionality in our customers' end products. Our precision measurement solutions are used across a wide variety of end markets upon which we focus, including industrial, industrial automation and robotics, test and measurement, transportation, steel, medical, agriculture, avionics, military and space, and consumer product applications. The Company has a long heritage of innovation in sensor technologies that provide accuracy, reliability and repeatability that make our customers' products safer, smarter, and more productive. As the functionality of customers' products continues to increase, and they integrate more precision measurement sensors and related systems into their solutions, we believe this will offer substantial growth opportunities for our products and expertise.

### The impact of the recent wars in Israel on our operations

In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets, resulting in extensive casualties and military engagement. In addition, Hezbollah, another terrorist organization based in Lebanon, began attacking Israel. While Israel has entered into certain ceasefire agreements regarding the conflicts, the threat of new attacks remains, including from additional extremist groups.

On June 13, 2025, Israel launched a preemptive strike on Iran, with military support from the United States. Iran retaliated with ballistic missile and drone strikes targeting both civilian and military sites in Israel. A ceasefire between Israel and Iran was reached on June 23, 2025, although there is no assurance that the ceasefire will continue. Israel’s airspace and maritime zones, which were closed to commercial traffic during the period between June 13 and June 23, 2025, are fully open as of August 5, 2025.

As of August 5, 2025 (the date of this filing), our operations in Israel are operating at normal levels. The extent and duration of the current conflicts, as well as the possibility of further spread of the conflicts to other countries in the region and involving other political and military entities in the Middle East, poses risks to our operations and may lead to disruptions which could adversely affect our business, prospects, financial condition and results of operations.

While sales to customers in Israel account for a relatively small portion of our revenues, our operations in Israel include executive offices, which are the workplace for key executives including our chief executive officer, as well as two manufacturing facilities located in the central part of Israel that manufacture products representing approximately 26% of our total worldwide revenues in the six fiscal months ended June 28, 2025. As of August 5, 2025, these facilities remain open and operational. We have implemented a contingency plan that, in the event conditions in Israel deteriorate such that we no longer operate there at normal levels, we believe will provide for securing supply of materials and logistics by producing a safety stock of finished goods and transferring these goods to our distribution centers outside of Israel, while continuing to take measures with regards to the safety of our employees. We may, however, determine to temporarily discontinue production in Israel for the safety of our employees. We could also face future production slowdowns or interruptions at either manufacturing location in Israel due to the impacts of the conflicts, including personnel absences as a number of our employees have been called to active military duty, or due to other resource constraints such as the inability to source materials for production.

### The impact of recent changes in tariffs

We have manufacturing operations in India, China, Japan, Europe, Canada, Israel and the United States, as well as in other countries.

The current political environment in the United States and internationally has resulted in uncertainty surrounding the state of the global economy particularly due to existing and potential changes to U.S. policies related to global trade and tariffs, The tariff changes have been set at various rates, with exemptions applicable to certain categories of imports and exports.

VPG continues to actively monitor and evaluate the ongoing situation, focusing on quickly responding to cost and price adjustments.

### Overview of Financial Results

VPG reports in three product segments: Sensors, Weighing Solutions, and Measurement Systems. The Sensors segment is comprised of the foil resistor and strain gage operating segments. The Weighing Solutions segment is comprised of specialized modules and systems used to precisely measure weight, force torque, and pressure. The Measurement Systems segment is comprised of highly specialized systems for steel production, materials development, and safety testing.

Net revenues for the fiscal quarter ended June 28, 2025 were $75.2 million versus $77.4 million for the comparable prior year period. Net profit attributable to VPG stockholders for the fiscal quarter ended June 28, 2025 was $0.3 million, or $0.02 per diluted share, compared to net earnings of $4.6 million, or $ 0.34 per diluted share, for the comparable prior year period.

Net revenues for the six fiscal months ended June 28, 2025 were $146.9 million versus $158.1 million for the comparable prior year period. Net loss attributable to VPG stockholders for the six fiscal months ended June 28, 2025 was $0.7 million, or $ 0.05 per diluted share, compared to net earnings of $10.5 million, or $0.78 per diluted share, for the comparable prior year period.

The results of operations for the fiscal quarters ended June 28, 2025 and June 29, 2024 include items affecting comparability as listed in the reconciliations below. The reconciliations below include certain financial measures which are not recognized in accordance with U.S. generally accepted accounting principles ("GAAP"), including adjusted gross profits, adjusted gross profit margin, adjusted operating income, adjusted operating margin, adjusted net earnings, adjusted net earnings per diluted share, EBITDA, and adjusted EBITDA. These non-GAAP measures should not be viewed as an alternative to GAAP measures of performance. Non-GAAP measures such as adjusted gross profits, adjusted gross profit margin, adjusted operating income, adjusted operating margin, adjusted net earnings, adjusted net earnings per diluted share, EBITDA, and adjusted EBITDA do not have uniform definitions. These measures, as calculated by VPG, may not be comparable to similarly titled measures used by other companies. Management believes that these non-GAAP measures are useful to investors because each presents what management views as our core operating results for the relevant period. The adjustments to the applicable GAAP measures relate to occurrences or events that are outside of our core operations, and management believes that the use of these non-GAAP measures provides a consistent basis to evaluate our operating profitability and performance trends across comparable periods. In addition, the Company has historically provided these or similar non-GAAP measures and understands that some investors and financial analysts find this information helpful in analyzing the Company’s performance and in comparing the Company’s financial performance to that of its peer companies and competitors. Management believes that the Company’s non-GAAP measures are regarded as supplemental to its GAAP financial results.

| Three months ended | Gross Profit June 28, 2025 | June 29, 2024 | Operating Income June 28, 2025 | June 29, 2024 | Net Earnings Attributable to VPG Stockholders June 28, 2025 | June 29, 2024 | Diluted Earnings Per share June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| As reported - GAAP | **$30,594** | $32,407 | **$2,708** | $5,906 | **$248** | $4,603 | **$0.02** | $0.34 |
| As reported - GAAP Margins | **40.7%** | 41.9% | **3.6%** | 7.6% | **—%** |  |  |  |
| Start-up costs (a) | **257** | — | **257** | — | **257** | — | **0.02** | — |
| Restructuring costs | — | — | **185** | — | **185** | — | **0.02** | — |
| Severance cost | — | — | **443** | — | **443** | — | **0.03** | — |
| Foreign currency exchange loss (gain) (b) | — | — | — | — | **1,763** | (1,289) | **0.13** | (0.10) |
| Less: Tax effect of reconciling items and discrete tax items | — | — | — | — | **624** | (836) | **0.05** | (0.06) |
| As Adjusted - Non GAAP | **$30,851** | $32,407 | **$3,593** | $5,906 | **$2,272** | $4,150 | **$0.17** | $0.31 |
| As Adjusted - Non GAAP Margins | **41.0%** | 41.9% | **4.8%** | 7.6% |  |  |  |  |

| Six Fiscal Months Ended | Gross Profit June 28, 2025 | June 29, 2024 | Operating Income June 28, 2025 | June 29, 2024 | Net (Loss) Earnings Attributable to VPG Stockholders June 28, 2025 | June 29, 2024 | Diluted Earnings Per share June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| As reported - GAAP | $57,640 | $67,501 | $2,648 | $12,824 | $(694) | $10,494 | $(0.05) | $0.78 |
| As reported - GAAP Margins | **39.2%** | 42.7% | **1.8%** | 8.1% |  |  |  |  |
| Start-up costs (a) | **720** | — | **720** | — | **720** | — | **0.06** | — |
| Restructuring costs | — | — | **580** | 782 | **580** | 782 | **0.04** | 0.06 |
| Severance cost | — | — | **443** | 347 | **443** | 347 | **0.03** | 0.03 |
| Foreign currency exchange loss (gain) (b) | — | — | — | — | **2,735** | (2,878) | **0.21** | (0.21) |
| Less: Tax effect of reconciling items and discrete tax items | — | — | — | — | **1,044** | (1,074) | **0.08** | (0.08) |
| As Adjusted - Non GAAP | $58,360 | $67,501 | $4,391 | $13,953 | $2,740 | $9,819 | $0.21 | $0.74 |
| As Adjusted - Non GAAP Margins | **39.2%** | 42.7% | **2.2%** | 8.8% |  |  |  |  |

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | For the Six Fiscal Months Ended fiscal months ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Net earnings (loss) earnings attributable to VPG stockholders | $248 | $4,603 | $(694) | $10,494 |
| Interest Expense | **550** | 649 | **1,101** | 1,277 |
| Income tax expense | **592** | 2,316 | **260** | 4,634 |
| Depreciation | **2,872** | 2,992 | **5,928** | 6,008 |
| Amortization | **982** | 924 | **1,960** | 1,851 |
| **EBITDA** | **5,244** | 11,484 | **8,555** | 24,264 |
| **EBITDA MARGIN** | **7.0%** | 14.8% | **5.8%** | 15.3% |
| Restructuring costs | **185** | — | **580** | 782 |
| Severance cost | **443** | — | **443** | 347 |
| Start-up costs (a) | **257** | — | **720** | — |
| Foreign currency exchange loss (gain) (b) | **1,763** | (1,289) | **2,735** | (2,878) |
| **ADJUSTED EBITDA** | $7,892 | $10,196 | $13,033 | $22,515 |
| **ADJUSTED EBITDA MARGIN** | **10.5%** | 13.2% | **8.9%** | 14.2% |

(a) Start-up cost 2025

(b) Impact of foreign currency exchange rates on assets and liabilities.

### Financial Metrics

We utilize several financial measures and metrics to evaluate performance and assess the future direction of our business. These key financial measures and metrics include net revenues, gross profit margin, end-of-period backlog, book-to-bill ratio, and inventory turnover.

Gross profit margin is computed as gross profit as a percentage of net revenues. Gross profit is generally net revenues less costs of products sold, but could also include certain other period costs. Gross profit margin is a function of net revenues, but also reflects our cost-cutting programs and our ability to contain fixed costs.

End-of-period backlog is one indicator of potential future sales. We include in our backlog only open orders that have been released by the customer for shipment in the next twelve months. If demand falls below customers’ forecasts, or if customers do not control their inventory effectively, they may cancel or reschedule the shipments that are included in our backlog, in many instances without the payment of any penalty. Therefore, backlog is not necessarily indicative of the results expected for future periods.

Another important indicator of demand in our industry is the book-to-bill ratio, which is the ratio of the amount of product ordered during a period compared with the amount of product shipped during that period. A book-to-bill ratio that is greater than one indicates that revenues may increase in future periods. Conversely, a book-to-bill ratio that is less than one is an indicator of lower demand and may foretell declining sales. The book-to-bill ratio is also impacted by the timing of orders, particularly from our project-based product lines.

We focus on inventory turnover as a measure of how well we manage our inventory. We define inventory turnover for a financial reporting period as our costs of products sold for the four fiscal quarters ending on the last day of the reporting period divided by our average inventory (computed using each quarter-end balance) for this same period. A higher level of inventory turnover reflects more efficient use of our capital.

The quarter-to-quarter trends in these financial metrics can also be an important indicator of the likely direction of our business. The following tables show net revenues, gross profit margin, end-of-period backlog, book-to-bill ratio, and inventory turnover for our business as a whole and by segment during the five quarters beginning with the second quarter of 2024 through the second quarter of 2025.

*(dollars in thousands)*

|  | 2nd Quarter 2024 | 3rd Quarter 2024 | 4th Quarter 2024 | 1st Quarter 2025 | 2nd Quarter 2025 |
| --- | ---: | ---: | ---: | ---: | ---: |
| Net revenues | $77,359 | $75,727 | $72,653 | $71,741 | $75,161 |
| Gross profit margin | 41.9% | 40.0% | 38.2% | 37.7% | 40.7% |
| End-of-period backlog | $104,858 | $100,191 | $96,189 | $100,300 | $108,201 |
| Book-to-bill ratio | 0.95 | 0.91 | 1.00 | 1.04 | 1.06 |
| Inventory turnover | 1.99 | 2.01 | 2.06 | 2.12 | 2.09 |

*(dollars in thousands)*

| Sensors | 2nd Quarter 2024 | 3rd Quarter 2024 | 4th Quarter 2024 | 1st Quarter 2025 | 2nd Quarter 2025 |
| --- | ---: | ---: | ---: | ---: | ---: |
| Net revenues | $28,869 | $28,201 | $25,755 | $27,055 | $26,563 |
| Gross profit margin | 38.3% | 31.0% | 32.0% | 30.1% | 32.0% |
| End-of-period backlog | $41,627 | $39,995 | $39,605 | $42,049 | $46,661 |
| Book-to-bill ratio | 0.90 | 0.89 | 1.04 | 1.06 | 1.12 |
| Inventory turnover | 2.02 | 2.28 | 2.15 | 2.38 | 2.27 |
| Weighing Solutions |  |  |  |  |  |
| Net revenues | $27,447 | $25,174 | $25,739 | $26,439 | $29,428 |
| Gross profit margin | 37.6% | 35.1% | 34.1% | 36.8% | 39.6% |
| End-of-period backlog | $25,077 | $25,590 | $28,003 | $28,241 | $26,734 |
| Book-to-bill ratio | 0.93 | 1.00 | 1.12 | 0.99 | 0.92 |
| Inventory turnover | 2.20 | 2.10 | 2.35 | 2.50 | 2.62 |
| Measurement Systems |  |  |  |  |  |
| Net revenues | $21,043 | $22,352 | $21,160 | $18,247 | $19,170 |
| Gross profit margin | 52.4% | 56.8% | 50.9% | 50.3% | 54.6% |
| End-of-period backlog | $38,154 | $34,605 | $28,581 | $30,010 | $34,805 |
| Book-to-bill ratio | 1.04 | 0.82 | 0.78 | 1.07 | 1.20 |
| Inventory turnover | 1.65 | 1.55 | 1.62 | 1.41 | 1.33 |

-26-

Net revenues for the second fiscal quarter of 2025 increased 4.8% from the first fiscal quarter of 2025 due to increases in the Measurement Systems and Weighing Solutions reporting segments which were partially offset by a decrease in revenues in the Sensors reporting segment. Net revenues for the second fiscal quarter of 2025 decreased 2.8% from the second fiscal quarter of 2024 in the Sensors and Measurement Systems reporting segments which were partially offset by an increase in revenues in the Weighing Solutions reporting segment.

Net revenues in the Sensors reporting segment decreased 1.8% compared to $27.1 million in the first fiscal quarter of 2025 and decreased 8.0% from $28.9 million in the second fiscal quarter of 2024. The year-over-year decrease in revenues was primarily attributable to lower sales of strain gages in our Other markets for consumer applications which offset higher sales in the Test & Measurement market. Sequentially, the decrease primarily reflected lower sales of precision resistors in the Test and Measurement market.

Net revenues in the Weighing Solutions reporting segment increased 11.3% from the first fiscal quarter of 2025 and increased 7.2% from the second fiscal quarter of 2024. The year-over-year increase in revenues was mainly attributable to higher sales in the Transportation market, as well as in our Other markets. Sequentially, the increase in revenues was primarily due to higher sales in the Transportation and Industrial Weighing, and in our Other markets for medical and precision agriculture applications.

Net revenues in the Measurement Systems reporting segment increased 5.1% from the first fiscal quarter of 2025 and decreased 8.9% from the second fiscal quarter of 2024. The year-over-year decrease was primarily attributable to decreased revenue in the Steel market, which offset higher sales in the Transportation and Avionics, Military and Space ("AMS") markets. Sequentially, the increase in revenue was primarily due to higher sales in the AMS market, which offset lower sales to the Transportation and Steel markets.

Overall gross profit margin in the second fiscal quarter of 2025 increased 3.0% as compared to the first fiscal quarter of 2025 and decreased 1.2% from the second fiscal quarter of 2024 across all three reporting segments.

### Optimize Core Competence

The Company’s core competencies include our innovative deep technical and applications-specific expertise to add value to our customers' products, our strong brands and customer relationships, our focus on operational excellence, our ability to select and develop our management teams, and our proven M&A strategy. We continue to optimize all aspects of our development, manufacturing and sales processes, including by increasing our technical sales efforts; continuing to innovate in product performance and design; and refining our manufacturing processes.

Our Sensors segment research group developed innovations that enhance the capability and performance of our strain gages, while simultaneously reducing their size and power consumption as part of our advanced sensors product line. We believe this unique foil technology will create new markets as customers “design in” these next generation products in existing and new applications. Our development engineering team is also responsible for creating new processes to further automate manufacturing and improve productivity and quality. Our advanced sensors manufacturing technology also offers us the capability to produce high-quality foil strain gages in a highly automated environment, which we believe results in reduced manufacturing and lead times, improved quality and increased margins. As a sign of our commitment to these businesses, we signed a long-term lease for a state-of-the-art facility that has been constructed in Israel.

Our design, research, and product development teams, in partnership with our marketing teams, drive our efforts to bring innovations to market. We intend to leverage our insights into customer demand to continually develop and roll out new, innovative products within our existing lines and to modify our existing core products in ways that make them more appealing, addressing changing customer needs and industry trends in terms of form, fit, and function.

We also seek to achieve significant production cost savings through the transfer, expansion, and construction of manufacturing operations in countries such as India, Japan, and Israel, where we can benefit from improved efficiencies or available tax and other government-sponsored incentives. In the past several years, we incurred restructuring expense related to closing and downsizing of facilities as part of the manufacturing transitions of our load cell products to facilities in India and China, which marked key milestones in our ongoing strategic initiatives to align and consolidate our manufacturing footprint.

### Acquisition Strategy

We expect to continue to make strategic acquisitions where opportunities present themselves to grow and expand our segments. Historically, our growth and acquisition strategy had been largely focused on vertical product integration, using our foil strain gages in our load cell products, and incorporating those products into our weighing solutions. In recent years, we widened our acquisition strategy to include a broader set of precision measurement systems and product companies.

We expect to expand our expertise, and our acquisition focus, outside our traditional vertical approach to other precision measurement solutions, including in the fields of measurement of force, weight, pressure, torque, tilt, motion, and acceleration. We believe acquired businesses will benefit from improvements we implement to reduce redundant functions and from our current global manufacturing and distribution footprint. On September 30, 2024, the Company acquired Nokra Optische Prueftechnik und Automation GmbH, a Germany-based, privately held maker of precision measuring and testing equipment for manufacturing. Please see our Form 8-K dated September 30, 2024, for more information.

### Research and Development

Research and development (“R&D”) will continue to play a key role in our efforts to introduce innovative products to generate new sales and to improve profitability. We expect to continue to expand our position as a leading supplier of precision foil technology products. We believe our R&D efforts should provide us with a variety of opportunities to leverage technology, products, and our manufacturing base in order to ultimately improve our financial performance.

### Cost Management

To be successful, we believe we must seek new strategies for controlling operating costs. Through automation in our plants, we believe we can optimize our capital and labor resources in production, inventory management, quality control, and warehousing. We are in the process of moving some manufacturing to more cost-effective locations. This may enable us to become more efficient and cost competitive and also maintain tighter controls of the operation.

Production transfers, facility consolidations, and other long-term cost-cutting measures require us to initially incur significant severance and other exit costs. We are realizing the benefits of our restructuring through lower labor costs and other operating expenses and expect to continue reaping these benefits in future periods. However, these programs to improve our profitability also involve certain risks which could materially impact our future operating results, as further detailed in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 25, 2025.

We are evaluating plans to further reduce our costs by consolidating additional manufacturing operations. These plans may require us to incur restructuring and severance costs in future periods. While streamlining and reducing fixed overhead, we are exercising caution so that we will not negatively impact our customer service or our ability to further develop products and processes.

### Goodwill

We test the goodwill in each of our reporting units for impairment at least annually, as of the first day of our fourth quarter, and whenever events or changes in circumstances occur indicating that a possible impairment may have been incurred. Determining whether to test goodwill for impairment, and the application of goodwill impairment tests, require significant management judgment, including the identification of reporting units, assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value of each reporting unit. Changes in these estimates could materially affect the determination of fair value for each reporting unit. A slowdown or deferral of orders for a business, with which we have goodwill associated, could impact our valuation of that goodwill.

### Foreign Currency

We are exposed to foreign currency exchange rate risks, particularly due to transactions in currencies other than the functional currencies of certain subsidiaries. U.S. GAAP requires that entities identify the “functional currency” of each of their subsidiaries and measure all elements of the financial statements in that functional currency. A subsidiary’s functional currency is the currency of the primary economic environment in which it operates. In cases where a subsidiary is relatively self-contained within a particular country, the local currency is generally deemed to be the functional currency. However, a foreign subsidiary that is a direct and integral component or extension of the parent company’s operations generally would have the parent company’s currency as its functional currency. We have subsidiaries that fall into each of these categories.

### Foreign Subsidiaries which use the Local Currency as the Functional Currency

Our operations in Europe, Canada, and certain locations in Asia primarily generate and expend cash using local currencies, and accordingly, these subsidiaries utilize the local currency as their functional currency. For those subsidiaries where the local currency is the functional currency, assets and liabilities in the consolidated condensed balance sheets have been translated at the rate of exchange as of the balance sheet date. Translation adjustments do not impact the results of operations and are reported as a separate component of equity.

For those subsidiaries where the local currency is the functional currency, revenues and expenses are translated at the average exchange rate for the period. While the translation of revenues and expenses into U.S. dollars does not directly impact the consolidated condensed statement of operations, the translation effectively increases or decreases the U.S. dollar equivalent of revenues generated and expenses incurred in those foreign currencies.

### Foreign Subsidiaries which use the U.S. Dollar as the Functional Currency

Our operations in Israel and certain locations in Asia primarily generate cash in U.S. dollars, and accordingly, these subsidiaries utilize the U.S. dollar as their functional currency. For those foreign subsidiaries where the U.S. dollar is the functional currency, all foreign currency financial statement amounts are remeasured into U.S. dollars. Exchange gains and losses arising from remeasurement of foreign currency-denominated monetary assets and liabilities are included in the results of operations. While these subsidiaries transact most business in U.S. dollars, they may have significant costs, particularly related to payroll, which are incurred in the local currency and significant lease assets and liabilities.

### Effects of Foreign Currency Exchange Rate on Operations

For the fiscal quarter ended June 28, 2025, the effect of foreign currency exchange rates increased net revenues by $1.2 million, and increased costs of products sold and selling, general, and administrative expenses by $1.6 million, when compared to the comparable prior year period.

For the six fiscal months ended June 28, 2025, the effect of foreign currency exchange rates increased net revenues by $0.2 million, and increased costs of products sold and selling, general, and administrative expenses by $1.2 million, when compared to the comparable prior year period.

### Results of Operations

Statement of operations’ captions as a percentage of net revenues and the effective tax rates were as follows:

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Costs of products sold | **59.3%** | 58.1% | **60.8%** | 57.3% |
| Gross profit | **40.7%** | 41.9% | **39.2%** | 42.7% |
| Selling, general, and administrative expenses | **36.9%** | 34.3% | **37.0%** | 34.1% |
| Operating income | **3.6%** | 7.6% | **1.8%** | 8.1% |
| (Loss) income before taxes | **1.2%** | 9.0% | **(0.3)%** | 9.6% |
| Net (loss) earnings | **0.4%** | 6.0% | **(0.4)%** | 6.6% |
| Net (loss) earnings attributable to VPG stockholders | **0.3%** | 6.0% | **(0.5)%** | 6.6% |
| Effective tax rate | **66.0%** | 33.30% | **(66.5)%** | 30.70% |

### Net Revenues

Net revenues were as follows *(dollars in thousands):*

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Net revenues | $75,161 | $77,359 | $146,902 | $158,142 |
| Change versus comparable prior year period | $(2,198) |  | $(11,240) |  |
| Percentage change versus prior year period | (2.8)% |  | (7.1)% |  |

Changes in net revenues were attributable to the following:

| Change attributable to: | vs. prior year quarter | vs. prior year to-date |
| --- | ---: | ---: |
| Change in volume | (4.5)% | (7.4)% |
| Change in average selling prices | 0.3% | 0.2% |
| Foreign currency effects | 1.4% | 0.1% |
| Net change | (2.8)% | (7.1)% |

During the quarter ended and six fiscal months ended June 28, 2025, net revenues decreased by 2.8% and 7.1% as compared to the comparable prior year periods, mainly due to lower volume on the Measurements systems and the Sensors segments.

### Gross Profit Margin

Gross profit as a percentage of net revenues was as follows:

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Gross profit margin | **40.7%** | 41.9% | **39.2%** | 42.7% |

The gross profit margin for the fiscal quarter ended June 28, 2025, decreased by 1.2% and for the six fiscal months ended June 28, 2025 decreased 3.5% as compared to the comparable prior year periods. For the second fiscal quarter of 2025, Weighing Solutions and Measurement Systems reporting segments had higher gross profit margins compared to the prior year period.

### Segments

Analysis of revenues and gross profit margins for each of our reportable segments is provided below.

#### Sensors

Net revenues of the Sensors segment were as follows *(dollars in thousands):*

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Net revenues | $26,563 | $28,869 | $53,620 | $58,283 |
| Change versus comparable prior year period | $(2,306) |  | $(4,663) |  |
| Percentage change versus prior year period | **(8.0)%** |  | (8.0)% |  |

Changes in Sensors segment net revenues were attributable to the following:

| Change attributable to: | vs. prior year quarter | vs. prior year to-date |
| --- | ---: | ---: |
| Change in volume | **(3.1)%** | (7.6)% |
| Change in average selling prices | **(1.3)%** | (0.7)% |
| Foreign currency effects | **(3.5)%** | 0.3% |
| Net change | **(8.0)%** | (8.0)% |

The Sensors segment revenue of $26.6 million in the second fiscal quarter of 2025 decreased 8.0% from $28.9 million in the second fiscal quarter of 2024; sequentially, revenue decreased 1.8% compared to $27.1 million in the first fiscal quarter of 2025. The year-over-year decrease in revenues was primarily attributable to lower sales of strain gages in our markets for consumer applications which offset higher sales in the Test & Measurement market. Sequentially, the decrease primarily reflected lower sales of precision resistors in the Test and Measurement market.

Gross profit as a percentage of net revenues for the Sensors segment was as follows:

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Gross profit margin | **32.0%** | **38.3%** | **31.0%** | 37.4% |

Gross profit margin for the Sensors segment was 32.0% for the second fiscal quarter of 2025, as compared to 38.3% in the second fiscal quarter of 2024, and increased compared to 30.1% in the first fiscal quarter of 2025. The year-over-year decrease in gross profit margin was primarily due to lower volume, net tariffs cost, and manufacturing inefficiencies, partially offset by an increase in inventories. Sequentially, the higher gross profit margin was primarily due to an increase in inventories and favorable foreign currency exchange rates, which offset the impact of lower volume and net tariff costs.

#### Weighing Solutions

Net revenues of the Weighing Solutions segment were as follows *(dollars in thousands):*

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Net revenues | $29,428 | $27,447 | $55,866 | $56,292 |
| Change versus comparable prior year period | $1,981 |  | $(426) |  |
| Percentage change versus prior year period | **7.2%** |  | (0.8)% |  |

-30-

Changes in Weighing Solutions segment net revenues were attributable to the following:

| Change attributable to: | vs. prior year quarter | vs. prior year to-date |
| --- | ---: | ---: |
| Change in volume | **3.4%** | (2.0)% |
| Change in average selling prices | **1.0%** | 0.6% |
| Foreign currency effects | **2.8%** | 0.6% |
| Net change | **7.2%** | (0.8)% |

The Weighing Solutions segment revenue of $29.4 million in the second fiscal quarter of 2025 increased 7.2% compared to $27.5 million in the second fiscal quarter of 2024 and was 11.3% higher than $26.4 million in the first fiscal quarter of 2025. The year-over-year increase in revenues was mainly attributable to higher sales in the Industrial Weighing and Transportation markets, as well as in our Other markets. Sequentially, the increase in revenues was primarily attributable to higher sales in the Transportation and Industrial Weighing, and in our Other markets for precision agriculture and medical applications.

Gross profit as a percentage of net revenues for the Weighing Solutions segment was as follows:

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Gross profit margin | 39.6% | 37.6% | 38.2% | 38.3% |

Gross profit margin for the Weighing Solutions segment was 39.6% for the second fiscal quarter of 2025, which increased compared to 37.6% in the second fiscal quarter of 2024, and increased compared to 36.8% in the first fiscal quarter of 2025. The year-over-year increase in gross profit margin was primarily due to higher volume, favorable foreign exchange rates, and cost reduction. The sequential increase in gross profit margin primarily reflected higher volume and favorable foreign exchange rates, which offset the impact of net tariff costs.

#### Measurement Systems

Net revenues of the Measurement Systems segment were as follows *(dollars in thousands):*

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Net revenues | $19,170 | $21,043 | $37,416 | $43,567 |
| Change versus comparable prior year period | $(1,873) |  | $(6,151) |  |
| Percentage change versus prior year period | **(8.9)%** |  | (14.1)% |  |

-31-

Changes in Measurement Systems segment net revenues were attributable to the following:

| Change attributable to: | vs. prior year quarter | vs. prior year to-date |
| --- | ---: | ---: |
| Change in volume | **(9.9)%** | (14.2)% |
| Change in average selling prices | **1.4%** | 1.0% |
| Foreign currency effects | **(0.4)%** | (0.9)% |
| Net change | **(8.9)%** | (14.1)% |

The Measurement Systems segment revenue of $19.2 million in the second fiscal quarter of 2025 decreased 8.9% year-over-year from $21.0 million in the second fiscal quarter of 2024 and increased 5.1% from $18.3 million in the first fiscal quarter of 2025. The year-over-year decrease was primarily attributable to decreased revenue in the Steel market. which offset higher sales in the Transportation and Avionics, Military and Space ("AMS") markets. Sequentially, the increase in revenue was primarily due to higher sales in the AMS market, which offset lower sales to the Transportation and Steel markets.

Gross profit as a percentage of net revenues for the Measurement Systems segment were as follows:

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Gross profit margin | 54.6% | 52.4% | 52.5% | 55.4% |

Gross profit margin for the Measurement Systems segment was 54.6%, compared to 52.4% in the second fiscal quarter of 2024, and 50.3% in the first fiscal quarter of 2025. The year-over-year increase in gross profit margin was primarily due to favorable product mix. The sequentially higher gross profit margin reflected higher volume and favorable product mix.

### Selling, General, and Administrative Expenses

Selling, general, and administrative (“SG&A”) expenses are summarized as follows *(dollars in thousands):*

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Total SG&A expenses | $27,701 | $26,501 | $54,412 | $53,895 |
| As a percentage of net revenues | **36.9%** | 34.3% | **37.0%** | 34.1% |

SG&A expenses for the fiscal quarter and six fiscal months ended June 28, 2025 increased $1.2 million and $0.5 million, respectively, compared to the comparable prior year period.

### Restructuring Costs

Restructuring costs reflect the cost reduction programs implemented by the Company. Restructuring costs are expensed during the period in which the Company determines it will incur those costs and all requirements for accrual are met. Because these costs are recorded based upon estimates, actual expenditures for the restructuring activities may differ from the initially recorded costs. If the initial estimates are too low or too high, the Company could be required either to record additional expense in future periods or to reverse part of the previously recorded charges.

The Company recorded $0.2 million and $0.0 million of restructuring costs during the fiscal quarter ended June 28, 2025 and June 29, 2024, respectively, and $0.6 million and $0.8 million of restructuring costs during the six fiscal months ended June 28, 2025 and June 29, 2024, respectively. Restructuring costs were comprised primarily of employee termination costs, including severance and statutory retirement allowances, in connection with various cost reduction programs.

### Other Income (Expense)

The following table analyzes the components of the line “Other” on the consolidated condensed statements of operations *(in thousands):*

|  | Fiscal Quarter Ended June 28, 2025 | June 29, 2024 | Change |
| --- | ---: | ---: | ---: |
| Foreign currency exchange (loss) gain | $(1,763) | $1,287 | $(3,050) |
| Interest income | **549** | 499 | 50 |
| Pension expense | **(11)** | (10) | (1) |
| Other | **(37)** | (75) | 38 |
|  | $(1,262) | $1,701 | $(2,963) |

|  | Six Fiscal Months Ended June 28, 2025 | June 29, 2024 | Change |
| --- | ---: | ---: | ---: |
| Foreign currency exchange (loss) gain | $(2,735) | $2,877 | $(5,612) |
| Interest income | **869** | 822 | 47 |
| Pension expense | **(22)** | (20) | (2) |
| Other | **(50)** | (118) | 68 |
|  | $(1,938) | $3,561 | $(5,499) |

Foreign currency exchange gain or loss are due to volatility in the global currency markets. For the fiscal quarter ended June 28, 2025 the foreign currency exchange loss was largely due to the fluctuation of the Israeli Shekel against the U.S. dollar. For the six fiscal months ended June 28, 2025 the foreign currency exchange loss was largely due to the fluctuation of the Japanese yen, Israeli Shekel and the British pound against the U.S. dollar.

### Income Taxes

For the fiscal quarter ended June 28, 2025, the Company reported income tax expense, and its effective tax rate was 66.0% compared to the fiscal quarter ended June 29, 2024, where the Company reported income taxes and its effective tax rate was 33.3%.

The effective tax rate for the fiscal quarter ended June 28, 2025, resulted primarily from our foreign income being taxed at varying tax rates and changes in valuation allowance on deferred tax assets. The effective tax rate for the fiscal quarter ended June 29, 2024 resulted primarily from the foreign income taxed at varying tax rates and changes in the valuation allowance on deferred tax assets.

For the six months ended June 28, 2025, the Company reported income taxes at an effective tax rate of (66.5)%, compared to the six months ended June 29, 2024, where the Company reported income taxes at an effective tax rate of 30.7%.

The change in effective tax rate in the six months ended June 28, 2025, compared to the corresponding period in the prior fiscal year is mainly due to fiscal year 2025 second quarter that increased the Company's tax expenses, in addition to the effect of foreign currency exchange rates effect on tax provisions in our non-US entities, and the valuation allowance on part of our deferred tax assets.

On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted into law, extending key provisions of the 2017 Tax Cuts and Jobs Act. The OBBBA provides for accelerated depreciation for property acquired and placed in service after January 19, 2025, and restores expensing of domestic research expenditures for years beginning after December 31, 2024. Additionally, the OBBBA restores the EBITDA-based interest expense limitation and includes changes related to the U.S. taxation of the income of our foreign subsidiaries and certain foreign derived income and the base erosion and anti-abuse tax. The legislation has multiple effective dates, with certain provisions effective in 2024 and other implemented through 2027. The Company is continuing to evaluate the impact of the OBBBA on its tax expenses.

The Company and its subsidiaries are subject to income taxes imposed by the U.S., various states, and the foreign jurisdictions in which we operate. Each jurisdiction establishes rules that set forth the years which are subject to examination by its tax authorities. While the Company believes the tax positions taken on its tax returns for each jurisdiction are supportable, they may still be challenged by the jurisdiction's tax authorities. In anticipation of such challenges, the Company has established reserves for tax-related uncertainties. These liabilities are based on the Company’s best estimate of the potential tax exposures in each respective jurisdiction. It may take a number of years for a final tax liability in a jurisdiction to be determined, particularly in the event of an audit. If an uncertain matter is determined favorably, there could be a reduction in the Company’s tax expense. An unfavorable determination could increase tax expense and could require a cash payment, including interest and penalties.

### Financial Condition, Liquidity, and Capital Resources

We believe that our current cash and cash equivalents, credit facilities and projected cash from operations will be sufficient to meet our liquidity needs for at least the next 12 months.

On August 15, 2024, the Company entered into a Fourth Amended and Restated Credit Agreement (the “2024 Credit Agreement”) among the Company, the lenders party thereto, JPMorgan Chase Bank, N.A., Wells Fargo Bank, N.A. and HSBC as joint lead arrangers and joint bookrunner, and JPMorgan Chase Bank, N.A, as agent for such lenders, pursuant to which the 2020 Credit Agreement, as amended, was amended and restated to, among other things, extend the maturity date from March 20, 2025 to August 15, 2029 and adjust the interest rate and commitment fee. The 2024 Credit Agreement provides for a multi-currency, secured credit facility (the “2024 Revolving Facility”) in an aggregate principal amount of $75.0 million, with a sublimit of $10.0 million which can be used for letters of credit for the account of the Company or its subsidiaries that are parties to the 2024 Credit Agreement, the proceeds of which may be used for working capital and general corporate purposes, and a portion of which were used to refinance the Company’s previously existing credit agreement. The Company may elect to make loans under the 2024 Revolving Facility in US Dollars, Euros, Canadian Dollars, Sterling, Japanese Yen or such other freely convertible foreign currency.

The obligations of the Company under the 2024 Credit Agreement are secured by pledges of stock in certain domestic and foreign subsidiaries, as well as guarantees by substantially all of the Company’s domestic subsidiaries. The obligations of the Company and the guarantors under the 2024 Credit Agreement are secured by substantially all the assets (excluding real estate) of the Company and such guarantors. The 2024 Credit Agreement restricts the Company from paying cash dividends and requires the Company to comply with other customary covenants, representations, and warranties, including the maintenance of specific financial ratios. The financial maintenance covenants include an interest coverage ratio and a leverage ratio. The Company was in compliance with its financial maintenance covenants at June 28, 2025. If the Company is not in compliance with any of these covenant restrictions, the credit facility could be terminated by the lenders, and all amounts outstanding pursuant to the credit facility could become immediately payable.

Our business has historically generated significant cash flow. For the six fiscal months ended June 28, 2025, cash provided by operating activities was $11.2 million compared to $13.9 million in the comparable prior year period. Our net cash used in investing activities for the six fiscal months ended June 28, 2025 was lower compared to the prior year period mainly due to lower capital spending. Our net cash used in financing activities for the six fiscal months ended June 28, 2025 was significantly lower when compared with the prior year period, due to expiration of the stock repurchase plan in accordance with its terms on August 9, 2024.

Approximately 92% and 94% of our cash and cash equivalents balance at June 28, 2025 and December 31, 2024, respectively, was held by our non-U.S. subsidiaries.

See the following table for the percentage of cash and cash equivalents, by region, at June 28, 2025 and December 31, 2024:

|  | June 28, 2025 | December 31, 2024 |
| --- | ---: | ---: |
| Israel | **39%** | 56% |
| Asia | **23%** | 21% |
| Europe | **25%** | 14% |
| United States | **8%** | 6% |
| Canada | **5%** | 3% |
|  | **100%** | **100%** |

We earn a significant amount of our operating income outside the United States, the majority of which is deemed to be indefinitely reinvested in foreign jurisdictions. As a result, as discussed above, a significant portion of our cash and short-term investments are held by foreign subsidiaries. The Company will continue to evaluate its cash needs, however we currently do not intend, nor do we foresee a need, to repatriate funds in excess of what is already planned. The Company will evaluate the possibility of repatriating future cash provided such repatriation can be accomplished in a tax efficient manner. In addition, we expect existing domestic cash, short-term investments, and cash flows from operations to continue to be sufficient to fund our domestic operating activities and cash commitments for investing and financing activities, such as debt repayment and capital expenditures, for at least the next 12 months and thereafter for the foreseeable future.

If we should require more capital in the United States than is generated by our domestic operations, for example, to fund significant discretionary activities, such as business acquisitions, we could elect to repatriate future earnings from foreign jurisdictions or raise capital in the United States through debt or equity issuances. These alternatives could result in higher tax expense, increased interest expense, or dilution of our earnings. We consider the majority of the undistributed earnings of our foreign subsidiaries, as of June 28, 2025, to be indefinitely reinvested.

Adjusted free cash flow generated during the six fiscal months ended June 28, 2025, was $8.5 million. We refer to the amount of cash provided by operating activities ($11.2 million) in excess of our capital expenditures ($2.7 million), net of proceeds, if any, from the sale of assets as “adjusted free cash flow.”

The following table summarizes the components of net cash at June 28, 2025 and December 31, 2024 *(in thousands):*

|  | June 28, 2025 | December 31, 2024 |
| --- | ---: | ---: |
| Cash and cash equivalents | $90,375 | $79,272 |
| Third-party long-term debt: |  |  |
| Revolving debt | **32,000** | 32,000 |
| Deferred financing costs | **(474)** | (559) |
| Total third-party debt | **31,526** | 31,441 |
| Net cash | $58,849 | $47,831 |

Measurements such as “adjusted free cash flow” and “net cash" do not have uniform definitions and are not recognized in accordance with U.S. GAAP. Such measures should not be viewed as alternatives to GAAP measures of performance or liquidity. However, management believes that “adjusted free cash flow” is a meaningful measure of our ability to fund acquisitions, and that an analysis of “net cash” assists investors in understanding aspects of our cash and debt management. These measures, as calculated by us, may not be comparable to similarly titled measures used by other companies.

Our financial condition as of June 28, 2025 remains strong, with a current ratio (current assets to current liabilities) of 4.4 to 1.0, as compared to a ratio of 4.5 to 1.0 at December 31, 2024.

Cash paid for property and equipment for the six fiscal months ended June 28, 2025 was $2.8 million compared to $5.2 million in the comparable prior year period.

As of June 28, 2025 and December 31, 2024, we did not have any off-balance sheet arrangements.

### Safe Harbor Statement

From time to time, information provided by us, including, but not limited to, statements in this report, or other statements made by or on our behalf, may contain or constitute "forward-looking" information within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve a number of risks, uncertainties, and contingencies, many of which are beyond our control, which may cause actual results, performance, or achievements to differ materially from those anticipated.

Such statements are based on current expectations only, and are subject to certain risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, expected, estimated, or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; significant developments from the recent and potential changes in tariffs and trade regulation; impact of inflation; potential issues respecting the United States federal government debt ceiling; global labor and supply chain challenges; difficulties or delays in identifying, negotiating and completing acquisitions and integrating acquired companies; the inability to realize anticipated synergies and expansion possibilities; difficulties in new product development; changes in competition and technology in the markets that we serve and the mix of our products required to address these changes; changes in foreign currency exchange rates; political, economic, and health (including pandemics) instabilities; instability or disruption caused by military hostilities in the regions or countries in which we operate (including Israel); difficulties in implementing our cost reduction strategies, such as underutilization of production facilities, labor unrest or legal challenges to our lay-off or termination plans, operation of redundant facilities due to difficulties in transferring production to achieve efficiencies; compliance issues under applicable laws, such as export control laws, including the outcome of our voluntary self-disclosure of export control non-compliance; our ability to execute our new corporate strategy and business continuity, operational and budget plans; and other factors affecting our operations, markets, products, services, and prices that are set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. We caution you not to place undue reliance on forward-looking statements, which speak only as of the date of this report or as of the dates otherwise indicated in such forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

## Market risk

As filed, 277 characters.

There have been no material changes in the market risks previously disclosed in Part II, Item 7A “Quantitative and Qualitative Disclosures About Market Risk” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 25, 2025.

## Controls and procedures

As filed, 2,529 characters.

### Disclosure Controls and Procedures

An evaluation was performed under the supervision and with the participation of our management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on that evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of the end of the period covered by this quarterly report to ensure that information required to be disclosed in reports that we file or submit under the Exchange Act are: (1) recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms; and (2) accumulated and communicated to our management, including our CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Our management, including our CEO and CFO, believes that any disclosure controls and procedures or internal controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must consider the benefits of controls relative to their costs. Inherent limitations within a control system include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by unauthorized override of the control. While the design of any system of controls is to provide reasonable assurance of the effectiveness of disclosure controls, such design is also based in part upon certain assumptions about the likelihood of future events, and such assumptions, while reasonable, may not take into account all potential future conditions. Accordingly, because of the inherent limitations in a cost effective control system, misstatements due to error or fraud may occur and may not be prevented or detected.

### Changes in Internal Control over Financial Reporting

During our last fiscal quarter ended June 28, 2025, there was no change in our internal control over financial reporting that materially affected, or is reasonable likely to materially affect, internal control over financial reporting.

## Risk factors

As filed, 441 characters.

In addition to the other information set forth in this Form 10-Q, you should carefully consider the factors discussed in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 25, 2025. There have been no material changes in reported risk factors from the information reported in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Filed Aug 5, 2025.
Source: SEC EDGAR, the filing index for accession 0001437749-25-024734. Last ingested by Listed: Nov 4, 2026, 08:34 ET. No prices; not investment advice.