10-K – 2026-02-20 – idxx-20251231.htm

In July 2025, the FASB issued ASU 2025-05, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets.” This amendment provides an optional practical expedient to assume that the current conditions as of the balance sheet date will remain unchanged for the remaining life of the asset when estimating expected credit losses on current accounts receivable and contract assets arising from transactions accounted for under Topic ASC 606 – Revenue from Contracts with Customers. The amendment is effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted. We anticipate the adoption of this ASU will not have a material impact on our consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, “Disaggregation of Income Statement Expenses”, to provide disaggregated disclosures of specific expense categories underlying all relevant income statement expense line items on an annual and interim basis. The disclosure requirements will apply on a prospective basis, with the option to apply them retrospectively. This standard is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. We are evaluating ASU 2024-03 to determine its impact on our consolidated financial statements and related disclosures.

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NOTE 3.       REVENUE

Revenue Recognition

We recognize revenue when, or as, performance obligations under the terms of a contract are satisfied, which occurs when control of the promised products or services is transferred to a customer, and it is probable that we will collect substantially all of the consideration to which we will be entitled, based on the customer’s intent and ability to pay the promised consideration. We exclude sales, use, value-added, and other taxes we collect on behalf of third parties from revenue. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products or services to a customer. To accurately present the consideration received in exchange for promised products or services, we apply the five-step model outlined below:

1. Identification of a contract or agreement with a customer
2. Identification of our performance obligations in the contract or agreement
3. Determination of the transaction price
4. Allocation of the transaction price to the performance obligations
5. Recognition of revenue when, or as, we satisfy a performance obligation

We enter into contracts where customers purchase combinations of IDEXX products and services, which are generally capable of being distinct and accounted for as separate performance obligations. The timing of revenue recognition, billings, and cash collections result in accounts receivable, lease receivables, and contract assets arising when revenue is recognized in advance of billings, and contract liabilities or deferred revenue as a result of receiving consideration in advance of revenue recognition within our consolidated balance sheets. Customer payment terms are typically 30  to  60  days, and these terms vary by location based on local business practices and by customer.

Customer contracts are modified primarily to create new, or change existing, enforceable rights and obligations. Customer contract modifications typically create new performance obligations to deliver additional goods and/or services that are distinct from the goods and/or services transferred before the modification, and the related increase in consideration does not reflect the standalone selling price for the additional goods and/or services. We account for these modifications prospectively as if it were a termination of the existing contract and the creation of a new contract, and we allocate the sum of the remaining consideration of the original contract that has not been recognized as revenue and the incremental consideration promised as part of the modification to the remaining performance obligations.

From time to time, we have other types of contract modifications. Contract modifications that do not create new performance obligations, but the goods and/or services to be delivered after the contract modification date are distinct from the goods and/or services transferred before the modification, are also accounted for as a termination of the existing contract and the creation of a new contract. Contract modifications that create new performance obligations to deliver additional goods and/or services that are distinct from the goods and/or services transferred before the modification, and the related increase in consideration approximates the standalone selling price for the additional goods and/or services, are accounted for as separate contracts.

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Revenues by Product and Service Categories and by Principal Geographic Areas

We present disaggregated revenue for our CAG segment based on major product and service categories. Our Water and LPD segments are comprised of a single major product category.

The following table presents revenue by major product and service categories:

(in thousands) For the Years Ended December 31,
2025 2024 2023
CAG segment revenue:      
CAG Diagnostics recurring revenue: $ 3,407,199   $ 3,129,492   $ 2,935,425  
IDEXX VetLab consumables 1,496,752   1,303,250   1,188,261  
Rapid assay products 348,950   359,754   344,494  
Reference laboratory diagnostic and consulting services 1,424,073   1,336,121   1,278,617  
CAG Diagnostics services and accessories 137,424   130,367   124,053  

CAG Diagnostics capital - instruments 200,206   131,928   137,603  

Veterinary software, services, and diagnostic imaging systems:
345,880   312,624   279,328  
Recurring revenue 276,338   250,359   214,597  
Systems and hardware 69,542   62,265   64,731  
CAG segment revenue 3,953,285   3,574,044   3,352,356  
Water segment revenue 201,149   185,112   168,149  
LPD segment revenue 131,787   122,060   121,659  
Other revenue
17,481   16,288   18,789  
Total revenue $ 4,303,702   $ 3,897,504   $ 3,660,953  

The following table presents revenue by principal geographic areas, based on customers’ domiciles:

(in thousands) For the Years Ended December 31,
2025 2024 2023
Americas
     
United States $ 2,752,785   $ 2,533,174   $ 2,391,427  
Canada 167,325   152,885   150,110  
Latin America & Caribbean 90,411   83,690   83,923  
Total Americas
3,010,521   2,769,749   2,625,460  

Europe, the Middle East, and Africa

Germany 206,759   173,682   149,789  
United Kingdom 154,435   134,630   121,745  
France 126,003   110,795   96,797  
Spain 70,971   61,857   52,332  
Italy 66,857   58,224   53,787  
Switzerland 41,696   37,183   34,830  
Netherlands 40,500   34,047   30,508  
Other 230,031   196,313   176,396  
Total Europe, the Middle East, and Africa
937,252   806,731   716,184  

Asia Pacific

Australia 112,247   101,959   95,465  
Japan 83,362   73,139   75,569  
China 35,956   35,822   44,168  
Other 124,364   110,104   104,107  
Total Asia Pacific 355,929   321,024   319,309  

Total revenue
$ 4,303,702   $ 3,897,504   $ 3,660,953  

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Major Categories of Revenue for our Products and Services

Diagnostic Products and Accessories . Diagnostic products and accessories revenues, including IDEXX VetLab consumables and accessories, rapid assay, LPD, and Water testing products, are predominantly recognized and invoiced at the time of shipment, which is when the customer obtains control of the product based on legal title transfer and we have the right to payment. We also provide customers with certain consumables for which revenue is recognized upon utilization by the customer, which is when we have the right to payment and the risks and rewards of ownership transfer. Shipping costs reimbursed by the customer are included in revenue and cost of sales. As a practical expedient, we do not account for shipping activities as a separate performance obligation.

Reference Laboratory Diagnostic and Consulting Services . Laboratory diagnostic and consulting services revenues are recognized upon the completion of the laboratory diagnostic services.

Instruments, Software and Systems . CAG Diagnostics capital instruments, diagnostic imaging systems, veterinary software licenses, and computer hardware revenues are recognized and invoiced when the customer obtains control of the products based on legal title transfer and we have the right to payment, which generally occurs at the time of installation and customer acceptance. Our instruments, software, and systems are often included in one of our significant customer programs, as described below.

SaaS Subscriptions . We offer a variety of veterinary software and diagnostic imaging software-as-a-service (“SaaS”) subscriptions. We recognize revenue for our SaaS subscriptions over time on a ratable basis over the contract term, beginning on the date our service is made available to the customer. Our subscription contracts vary in term, generally from monthly to  three years . Customers typically pay for our subscription contracts in monthly amounts over the term of the arrangement. Deferred revenue related to our SaaS subscriptions is not material.

Extended Warranties and Post-Contract Support . CAG Diagnostics capital instruments and diagnostic imaging systems extended warranties typically provide customers with continued coverage for a period of  one  to  six years beyond the initial standard warranty. Customers either pay in full for the extended warranty at the time of instrument or system purchase, or are billed on a quarterly basis over the term of the contract. We recognize revenue associated with extended warranties over time on a ratable basis using a time-elapsed measure of performance over the contract term, which approximates the expected timing in which applicable services are performed.

Veterinary software post-contract support provides customers with access to technical support when and as needed through access to call centers and online customer assistance. Post-contract support contracts typically have a term of  twelve months and customers are typically billed for post-contract support in equal quarterly amounts over the term. We recognize revenue for post-contract support services over time on a ratable basis using a time-elapsed measure of performance over the contract term, which approximates the expected timing in which applicable services are performed.

Contracts with Multiple Performance Obligations

We enter into arrangements with multiple performance obligations where customers purchase a combination of IDEXX products and services. We apply judgment to determine whether products and services are considered distinct performance obligations that should be accounted for separately. We determine the transaction price for a contract based on the total consideration we expect to receive in exchange for the transferred goods or services. To the extent the transaction price includes variable consideration, such as volume rebates or expected price adjustments, we apply judgment in constraining the estimated variable consideration due to factors that may cause reversal of revenue recognized. We evaluate constraints based on our historical and projected experience with similar customer arrangements.

We allocate revenue to each performance obligation in proportion to the relative standalone selling prices and recognize revenue when control of the related goods or services is transferred for each obligation. 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 using relevant information available and apply suitable estimation methods including, but not limited to, the cost plus a margin approach. We recognize revenue as each performance obligation is satisfied, either at a point in time or over time. We do not disclose information about remaining performance obligations that are part of arrangements with an original expected duration of one year or less.

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The following customer arrangements represent our most significant customer contracts that contain multiple performance obligations:

     Customer Commitment Arrangements . We offer customers incentives upon entering into multi-year arrangements to purchase minimum annual amounts of products and services.

Free or Discounted Instruments and Systems . Many of our customer commitment arrangements, such as our IDEXX 360 program, provide customers with free or discounted instruments or systems upon entering into multi-year arrangements to purchase minimum annual amounts of products and services. We allocate total consideration, including future committed purchases and expected price adjustments, based on relative standalone selling prices to identified performance obligations and recognize instrument revenue and cost at the time of installation and customer acceptance in advance of billing the customer, which is also when the customer obtains control of the instrument based on legal title transfer. Our right to future consideration related to instrument revenue is recorded as a contract asset within other current and long-term assets. The contract asset is reclassified to accounts receivable when customers are billed for products and services over the term of the arrangement. We have determined that these arrangements do not include a significant financing component.

On December 31, 2024, our contract assets were $ 246.3 million, of which approximately $ 62.9 million were reclassified to accounts receivable when customers were billed for related products and services during the year ended December 31, 2025. Furthermore, as a result of new placements under commitment arrangements, net of subsequent amounts reclassified to accounts receivable, and allowances established for credit losses, our contract assets were $ 312.7 million as of December 31, 2025. We monitor customer purchases over the term of their arrangement to assess the realizability of our contract assets and review estimates of variable consideration. Impairments and revenue adjustments that relate to performance obligations satisfied in prior periods, including cumulative catch-up adjustments to revenue arising from contract modifications, during the years ended December 31, 2025, 2024, and 2023, were not material.

Up-Front Consideration Paid to Customers . We provide customers with incentives in the form of IDEXX Points upon entering into multi-year arrangements to purchase minimum annual amounts of future products and services. If a customer breaches their agreement, they are required to refund all or a portion of the up-front consideration, or make other repayments, remedial actions, or both. Up-front incentives to customers in the form of IDEXX Points or, to a lesser degree, cash payments, are not made in exchange for distinct goods or services and are capitalized as consideration paid to customers within other current and long-term assets, which are subsequently recognized as a reduction to revenue over the term of the customer arrangement. If these up-front incentives are subsequently utilized to purchase instruments, we allocate total consideration, including future committed purchases less up-front incentives and estimates of expected price adjustments, based on relative standalone selling prices, to identified performance obligations, and recognize instrument revenue and cost at the time of installation and customer acceptance. To the extent invoiced instrument revenue exceeds recognized instrument revenue, we record deferred revenue as a contract liability, which is subsequently recognized upon the purchase of products and services over the term of the contract. We have determined these arrangements do not include a significant financing component.

On December 31, 2024, our capitalized consideration paid to customers was $ 196.6 million, of which approximately $ 62.0 million was recognized as a reduction of revenue during the year ended December 31, 2025. Furthermore, as a result of new payments to customers, net of subsequent recognition, our capitalized consideration paid to customers was $ 250.1 million as of December 31, 2025. We monitor customer purchases over the term of their arrangement to assess the realizability of our capitalized consideration paid to customers and review estimates of variable consideration. Impairments and revenue adjustments that relate to performance obligations satisfied in prior periods, including cumulative catch-up adjustments to revenue arising from contract modifications, during the years ended December 31, 2025, 2024, and 2023 were not material.

Rebate Arrangements . Our rebate arrangements provide customers the opportunity to earn future rebates based on the volume of products and services they purchase over the term of the arrangement. Rebate incentives are typically offered in multi-year arrangements that include customer commitments to purchase minimum annual amounts of products and services, or, to a lesser extent, are sometimes offered without
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future purchase commitments. We account for the customer’s right to earn rebates on optional future purchases that are determined to be a material right as a separate performance obligation and estimate the standalone selling price, which represents the expected value to the customer, based on historical rebate experience, the contractual rebate structure and terms, and other relevant information. Total consideration allocated to identified performance obligations is limited to goods and services that the customer is presently obligated to purchase and does not include estimates of future purchases that are optional. We allocate total consideration to identified performance obligations, including the customer’s right to earn rebates on future purchases, which is deferred and subsequently recognized upon the customer’s purchase of eligible products and services.

On December 31, 2024, our deferred revenue related to rebate and up-front consideration arrangements was $ 30.0 million, of which approximately $ 10.3 million was recognized when customers purchased eligible products and services during the year ended December 31, 2025. Furthermore, as a result of new customer purchases under rebate and up-front consideration arrangements, net of subsequent recognition, our deferred revenue was $ 35.3 million as of December 31, 2025, of which approximately  29 %,  25 %,  19 %, 14 %, and  13 % are expected to be recognized during 2026, 2027, 2028, 2029, and thereafter, respectively.

For our customer commitment arrangements, we estimate future revenues related to multi-year arrangements to be approximately $ 5.0 billion, of which approximately  28 %,  25 %,  22 %, 14 %, and  11 % are expected to be recognized during 2026, 2027, 2028, 2029, and thereafter, respectively. These future revenues relate to performance obligations not yet satisfied, for which customers have committed to future purchases, net of the expected revenue reductions from consideration paid to customers and expected price adjustments, and as a result, are lower than stated contractual commitments by our customers.

Instrument Rental Arrangements . Revenues from instrument rental and reagent rental arrangements are recognized either as operating leases on a ratable basis over the term of the arrangement or as sales-type leases at the time of installation and customer acceptance. Customers typically pay for the right to use instruments under rental arrangements in equal monthly amounts over the term of the rental arrangement. For some arrangements, customers are provided with the right to purchase the instrument at the end of the lease term. Our reagent rental arrangements provide customers the right to use our instruments upon entering into multi-year arrangements to purchase minimum annual amounts of consumables. These types of arrangements include an embedded lease for the right to use our instrument, and we determine the amount of lease revenue allocated to the instrument based on relative standalone selling prices. Lease revenues are presented in product revenue on our consolidated income statement. Lease revenues were approximately $ 15.8 million, $ 13.9 million, and $ 20.7 million for the years ended December 31, 2025, 2024, and 2023, respectively, including both operating leases and sales-type leases.

Sales-type Reagent Rental Arrangements . Our reagent rental arrangements that effectively transfer control of instruments to our customers are classified as sales-type leases, and we recognize instrument revenue and cost in advance of billing the customer, at the time of installation and customer acceptance. Our right to future consideration related to instrument revenue is recorded as a lease receivable within other current and long-term assets, and is reclassified to accounts receivable when customers are billed for products and services over the term of the arrangement. On December 31, 2024, our lease receivable assets were $ 19.0  million, of which approximately $ 5.3  million was reclassified to accounts receivable when customers were billed for related products and services during the year ended December 31, 2025. Furthermore, as a result of new placements under sales-type reagent rental arrangements, net of subsequent amounts reclassified to accounts receivable, and allowances established for credit losses, our lease receivable assets were $ 18.0 million as of December 31, 2025. The impacts of discounting and unearned income as of December 31, 2025, were not material. Profit and loss recognized at the commencement date and interest income during the year ended December 31, 2025, were not material. We monitor customer purchases over the term of their arrangement to assess the realizability of our lease receivable assets. Impairments during the year ended December 31, 2025, were not material.

Operating-type Reagent Rental Arrangements . Our reagent rental arrangements that do not effectively transfer control of instruments to our customers are classified as operating leases, and we recognize instrument revenue and costs ratably over the term of the arrangement. The cost of the instrument is capitalized within property and equipment. During the year ended December 31, 2025, we transferred
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instrume nts of $ 9.9 million compared to $ 14.2 million during the year ended December 31, 2024, from inventory to property and equipment.

We estimate future revenue to be recognized related to our reagent rental arrangements of approximately $ 94.7 million, of which approximately  24 %,  21 %,  18 %, 15 %, and 22 % are expected to be recognized during 2026, 2027, 2028, 2029, and thereafter, respectively. These future revenues relate to performance obligations not yet satisfied for which customers have committed to future purchases, net of expected price adjustments, and as a result, may be lower than stated contractual commitments by our customers.

Other Customer Incentive Arrangements . Certain arrangements with customers include discounts or rebates on the sale of products and services applied retrospectively, such as volume rebates achieved by purchasing a specified purchase threshold of goods and services over a specified period. We account for these discounts as variable consideration and estimate the likelihood of a customer meeting the threshold in order to determine the transaction price using the most predictive approach. We typically use the most-likely-amount method for incentives that are offered to individual customers, and the expected-value method for arrangements that are offered to a broad group of customers. Revenue adjustments that relate to performance obligations satisfied in prior periods, including cumulative catch-up adjustments to revenue arising from contract modifications, during the years ended December 31, 2025, and 2024, were not material. Refund obligations related to customer incentive arrangements are recorded in accrued liabilities for the actual issuance of incentives, incentives earned but not yet issued, and estimates of incentives to be earned in the future.

Combined Arrangements . At times, we combine aspects of customer commitment arrangements, instrument rental arrangements, and other incentives within a single customer arrangement. We separate each significant element and include the contract assets, consideration paid to customers, deferred revenues, and estimated future revenues within the most relevant disclosures above. Each customer contract is presented as a net contract asset or net contract liability on our consolidated balance sheets.

Deferred Extended Warranties and Post-Contract Support Revenue

On December 31, 2024, our deferred revenue related to extended warranties and post-contract support was $ 25.2 million, of which approximately $ 19.7 million was recognized during the year ended December 31, 2025. Furthermore, as a result of new arrangements, our deferred revenue related to extended warranties and post-contract support was $ 27.1 million at December 31, 2025. We do not disclose information about remaining performance obligations that are part of contracts with an original expected duration of one year or less, and do not adjust for the effect of the financing components when the period between customer payment and revenue recognition is one year or less. Deferred revenue related to extended warranties and post-contract support with an original duration of more than one year was $ 9.5 million at December 31, 2025, of which approximately 40 %,  31 %,  16 %, 8 %, and  5 % are expected to be recognized during 2026, 2027, 2028, 2029, and thereafter, respectively. We have determined these arrangements do not include a significant financing component.

IDEXX Points

IDEXX Points may be applied to trade receivables due to us or applied against the purchase price of IDEXX products and services. We consider IDEXX Points equivalent to cash. IDEXX Points that have not yet been used by customers are included in accrued liabilities until utilized or expired. Breakage is not material because customers can apply IDEXX Points to trade receivables at any time.

Costs to Obtain a Contract

We capitalize sales commissions and the related fringe benefits earned by our sales force when considered incremental and recoverable costs of obtaining a contract that includes future performance obligations. Our contracts include performance obligations related to various goods and services, some of which are satisfied at a point in time and others over time. Commission costs related to performance obligations satisfied at a point in time are expensed at the time of sale, which is when revenue is recognized. Commission costs related to long-term service contracts and performance obligations satisfied over time, including extended warranties and SaaS subscriptions, are deferred and recognized on a ratable basis that is consistent with the transfer of the goods or services to which the asset relates. We apply judgment in estimating the amortization period, which ranges from  2  to  7 years, by taking into consideration our customer contract terms, history of renewals, and expected length of customer relationships, as well as the useful life of the underlying technology and products. Amortization expense is included in
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sales and marketing expenses in the accompanying consolidated statements of income. Deferred commission costs are periodically reviewed for impairment.

On December 31, 2024, our deferred commission costs, included within other current and long-term assets, were $ 22.0 million, of which approximately $ 6.9 million of commission expense was recognized during the year ended December 31, 2025. Furthermore, as a result of commissions related to new extended warranties and SaaS subscriptions, net of subsequent recognition, our deferred commission costs were $ 21.4 million as of December 31, 2025. Impairments of deferred commission costs during the years ended December 31, 2025, 2024, and 2023 were not material.

NOTE 4.       ACQUISITIONS, ASSET PURCHASES AND INVESTMENTS

We believe that our acquisitions of businesses and other assets enhance our existing businesses by either expanding our geographic range, customer base, or existing product and service lines. From time to time, we acquire small reference laboratories or radiology practices that we account for as either asset purchases or business combinations, and we acquire noncontrolling minority interests in business entities, which we recognize as equity investments. We also acquire commercial rights to certain technology through licensing agreements.

Asset Purchases and Investments

During September 2025, we acquired a customer relationship intangible asset of a privately-owned reference laboratory in the U.S. for approximately $ 15.6  million, including an estimated contingent payment of $ 2.3  million at the time of acquisition. The customer relationship intangible has an estimated life of 10 years. The revenue associated with the acquired customer relationships has been included in our CAG segment since the acquisition date.

During 2024, we acquired a perpetual intellectual property license for $ 10.0  million. The license has an estimated useful life of 10 years, and is included in our CAG segment.

Business Combinations

During the first quarter of 2024, we acquired the assets of a privately-owned software and data platform business based in the U.S. that extended our practice management system cloud-native workflow and delivers strategic data solutions to our customers and their clients, for approximately $ 81.1  million, including a contingent payment valued at $ 4.4  million at the time of purchase. The fair values and the lives of the assets and liabilities acquired were as follows: completed technology of $ 17.1  million, with a life of 6 years; customer relationship intangibles of $ 12.5  million, with a life of 10 years; a non-compete agreement of $ 4.7  million, with a life of 5 years; and a trademark of $ 0.7  million, with a life of 10 years. We also recognized goodwill of $ 45.8  million, which represents synergies with our software business, and $ 0.3  million of net tangible assets, including accounts receivable. Goodwill related to this acquisition is expected to be deductible for tax purposes. Pro forma information has not been presented for this acquisition because such information is not material to the financial statements. The results of operations have been included in our CAG segment since the acquisition date, and was not material to the financial statements. The acquisition expenses were not significant.

    

NOTE 5.       SHARE-BASED COMPENSATION

We provide for various forms of share-based compensation awards to our employees and non-employee directors. Our share-based compensation plans allow for the issuance of a mix of stock options, restricted stock, stock appreciation rights, employee stock purchase rights, and other stock unit awards. With the exception of stock options, the fair value of our awards is equal to the closing stock price of IDEXX common stock on the date of grant. We calculate the fair value of our stock option awards using the Black-Scholes-Merton option-pricing model. For stock options, restricted stock units (“RSUs”), performance-based restricted stock units (“PBRSUs”), and deferred stock units (“DSUs”), share-based compensation expense is estimated based on awards ultimately expected to vest, reduced for estimated forfeitures, on a straight-line basis over the requisite service period of the award.  

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Stock options permit a holder to buy IDEXX stock upon vesting at the stock option exercise price set on the day of grant. An RSU is an agreement to issue shares of IDEXX stock at the time of vesting. A PBRSU is an agreement to issue shares of IDEXX stock at the time of vesting upon achievement of certain performance goals. DSUs are granted under our Executive Deferred Compensation Plan, which was suspended in February 2013 (the “Suspended Executive Plan”), our non-employee Director Deferred Compensation Plan (the “Director Plan”), and our Deferred Compensation Plan adopted in December 2024 (the “Executive Plan”). DSUs may or may not have vesting conditions depending on the plan under which they are issued. We did not issue any restricted stock or stock appreciation rights during the years ended December 31, 2025, 2024, and 2023, nor were any restricted stock or stock appreciation rights outstanding as of those years then ended.

We primarily issue shares of common stock to satisfy stock option exercises and employee stock purchase rights, and to settle RSUs, PBRSUs, and DSUs. We issue shares of treasury stock to settle certain RSUs and upon the exercise of certain stock options, which were not material for the years ended December 31, 2025, 2024, and 2023. The number of shares of common stock and treasury stock issued are equivalent to the number of awards exercised or settled.

With the exception of employee stock purchase rights, equity awards are issued to employees and non-employee di rectors under the 2018 Stock Incentive Plan (the “2018 Stock Plan”). Our Board of Directors has authorized the issuance of 7.5 million shar es of our common stock under the 2018 Stock Plan. Any shares that are subject to awards of stock options or stock appreciation rights will be counted against the share limit as one share for every share granted. Any shares that are issued other than stock options and stock appreciation rights will be counted against the share limit as 2.4 shares for every share granted. If any shares issued under our prior plans are forfeited, settled for cash, or expire, these shares, to the extent of such forfeiture, cash settlement, or expiration, will again be available for issuance under the 2018 Stock Plan. As of December 31, 2025, there were approximately 5.6 million remaining shares available for issuance under the 2018 Stock Plan.

Share-Based Compensation

Share-based compensation costs are classified in the consolidated financial statements consistent with the classification of cash compensation paid to the employees receiving such share-based compensation. The following is a summary of share-based compensation costs and related tax benefits recorded in our consolidated statements of income:

(in thousands) For the Years Ended December 31,
2025 2024 2023
     
Share-based compensation expense included in cost of revenue $ 6,555   $ 6,014   $ 5,643  
Share-based compensation expense included in operating expenses 53,458   54,281   54,096  
Total share-based compensation expense included in consolidated statements of income 60,013   60,295   59,739  
Deferred tax benefit resulting from share-based compensation expense
( 6,963 ) ( 6,650 ) ( 5,487 )
Net share-based compensation expense included in consolidated statements of income, excluding tax benefit from settlement of share-based awards 53,050   53,645   54,252  
Income tax benefit resulting from settlement of share-based awards ( 28,295 ) ( 19,625 ) ( 13,703 )
Net expense related to share-based compensation arrangements included in consolidated statements of income
$ 24,755   $ 34,020   $ 40,549  

There were no material modifications to the terms of outstanding options, RSUs, PBRSUs, or DSUs during the years ended December 31, 2025, 2024, or 2023.

Share-based compensation expense is reduced for an estimate of the number of awards that are expected to be forfeited. We use historical data and other factors to estimate expected employee terminations and to evaluate whether particular groups of employees have significantly different forfeiture expectations. Our share-based awards granted to employees in certain years include a retirement provision based on age and length of service. These grants are subject to accelerated expensing if the grantee meets the retirement definition set forth in the applicable equity and incentive plan documents.
 
The total unrecognized compensation expense, net of estimated forfeitures, for unvested share-based compensation awards as of December 31, 2025, was $ 67.3 million, which will be recognized over a weighted-average period of approximately 1.3 years.

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Stock Options

The majority of outstanding employee grants vest ratably over four years . Vesting of option awards issued is conditional upon continuous service, unless the employee retires under the retirement provision, for which retirees’ grants will vest two additional years following the retirement date. Options granted have a contractual term of ten years . Upon any change in control of the company, 25 % of the unvested stock options then outstanding will vest and become exercisable. However, if the acquiring entity does not assume outstanding options, then all options will vest immediately prior to the change in control. Options granted to non-employee directors vest fully on the earlier of the first anniversary of the date of grant or the date of the following annual meeting of stockholders.

We use the Black-Scholes-Merton option-pricing model to determine the fair value of options granted. Option-pricing models require the input of assumptions, particularly for the expected stock price volatility and the expected term of options. Changes in the input assumptions can affect the fair value estimate. Our expected stock price volatility assumptions are based on the historical volatility of our stock over periods that are similar to the expected terms of grants and other relevant factors. We derive the expected term based on historical experience and other relevant factors concerning expected employee behavior with regard to option exercise. The risk-free interest rate is based on U.S. Treasury yields for a maturity approximating the expected term calculated at the date of grant. We have never paid cash dividends on our common stock, and we have no intention to pay a dividend at this time; therefore, we assume that no dividends will be paid over the expected terms of option awards.

We determine the assumptions used in the valuation of option awards as of the date of grant. Differences in the expected stock price volatility, expected term, or risk-free interest rate may necessitate distinct valuation assumptions at those grant dates. As such, we may use different assumptions for options granted throughout the year. The weighted averages of the valuation assumptions used to determine the fair value of each option award on the date of grant and the weighted average estimated fair values were as follows:

For the Years Ended December 31,
2025 2024 2023
     
Expected stock price volatility 33   % 32   % 32   %
Expected term, in years 7.3 7.0 6.7
Risk-free interest rate 4.5   % 4.3   % 3.7   %
Weighted average fair value of options granted
$ 207.00   $ 239.49   $ 201.48  

A summary of the status of options granted under our share-based compensation plans as of December 31, 2025, and changes during the year then ended, are presented in the table below:

Number of Options (000) Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value ($000)
       
Outstanding as of December 31, 2024 1,461 $ 291.25  
Granted 124 $ 461.89  
Exercised ( 451 ) $ 173.46  
Forfeited ( 12 ) $ 501.17  
Expired ( 6 ) $ 555.05  
Outstanding as of December 31, 2025 1,116 $ 354.19   4.6 $ 359,837  

Fully vested as of December 31, 2025 831 $ 303.70   3.6 $ 309,961  

Fully vested and expected to vest as of December 31, 2025 (1)
1,104 $ 352.71   4.6 $ 357,656  

 (1) Includes options that are vested as of December 31, 2025, and outstanding options that are expected to vest in the future, net of estimated forfeitures.

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The total fair value of options vested were $ 23.2 million, $ 25.1 million, and $ 22.5 million during the years ended December 31, 2025, 2024, and 2023, respectively.

The intrinsic value of stock options exercised represents the amount by which the market price of the common stock exceeded the exercise price before applicable income taxes. The total intrinsic values of stock options exercised were $ 185.9 million, $ 85.7 million, and $ 75.5 million during the years ended December 31, 2025, 2024, and 2023, respectively.

Restricted Stock Units 

The majority of outstanding employee grants vest ratably over four years . A minority of certain employee grants cliff vest three years from the date of grant. Vesting as it relates to RSUs issued is conditional upon continuous service, unless the employee retires under the retirement provision, for which they will vest for two additional years following the retirement date. Upon any change in control of the company, 25 % of the unvested RSUs then outstanding will vest, provided, however, that if the acquiring entity does not assume the RSUs then all such units will vest immediately prior to the change in control. RSUs granted to non-employee directors vest fully on the earlier of the first anniversary of the date of grant or the date of the following annual meeting of stockholders.

A summary of the status of RSUs granted under our share-based compensation plans as of December 31, 2025, and changes during the year then ended, are presented in the table below:

Number of Units (000) Weighted Average Grant-Date Fair Value
   
Nonvested as of December 31, 2024 130 $ 519.38  
Granted 63 $ 468.19  
Vested ( 50 ) $ 511.29  
Forfeited ( 9 ) $ 504.80  
Nonvested as of December 31, 2025 134 $ 499.32  

 Expected to vest as of December 31, 2025 (1)
129 $ 498.67  

(1) Outstanding units that are expected to vest in the future, net of estimated forfeitures.

The total fair values of RSUs vested were $ 22.8 million, $ 32.9 million, and $ 31.1 million during the years ended December 31, 2025, 2024, and 2023, respectively. The aggregate intrinsic value of nonvested RSUs was $ 87.5 million, which is equal to the fair value of IDEXX’s common stock as of December 31, 2025, multiplied by the number of nonvested units expected to vest. The weighted average grant date fair values per share of RSUs for the years ended December 31, 2024 and 2023, were $ 550.64 and $ 497.14 , respectively.

Performance-Based Restricted Stock Units

Beginning in 2024, certain executives are granted PBRSUs that cliff vest three years from the date of grant based on achievement of certain financial performance metrics over a three-year performance period. Vesting as it relates to PBRSUs is conditional upon continuous service, unless the employee retires under the retirement provision. Upon any change in control of the company, 25 % of the unvested PBRSUs then outstanding will vest, provided, however, that if the acquiring entity does not assume the PBRSUs, then all such units will vest immediately prior to the change in control. Based on the extent to which the performance targets are achieved, vested shares may range from 0 % to 200 % of the target award. At the time of grant, we assume the PBRSUs will meet performance goals to vest at 100 % of target. Compensation costs for PBRSUs is adjusted for subsequent changes in the estimated outcome of the performance conditions until the vesting dates.
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A summary of the status of PBRSUs granted under our share-based compensation plans as of December 31, 2025, and changes during the year then ended, are presented in the table below:

Number of Units (000) Weighted Average Grant-Date Fair Value

Nonvested as of December 31, 2024 16 $ 560.56  
Granted 25 $ 459.76  
Vested — —  
Forfeited ( 1 ) $ 505.17  
Nonvested as of December 31, 2025 40 $ 499.47  

Expected to vest as of December 31, 2025 40 $ 499.71  

The aggregate intrinsic value of nonvested PBRSUs as of December 31, 2025, was $ 27.2  million, which is equal to the fair value of IDEXX’s common stock multiplied by the number of nonvested units expected to vest, as of December 31, 2025. No PBRSUs vested during 2024 and 2025. The weighted average grant date fair value per share of PBRSUs for the year ended December 31, 2024, was $ 550.56 .

Deferred Stock Units

Under our Director Plan, non-employee directors may defer a portion of their director cash compensation in the form of vested DSUs. Prior to 2014, certain members of our management could elect to defer a portion of their cash compensation in the form of vested DSUs under our Suspended Executive Plan. Under our Executive Plan, certain members of our management may elect to defer a portion of their RSUs or PBRSUs in the form of DSUs subject to the vesting conditions set forth in the applicable equity award agreement. Each DSU represents the right to receive one unissued share of our common stock. These recipients receive a number of DSUs equal to the amount of deferred compensation divided by the closing sale price of the common stock on the date of deferral or the number of RSUs or PBRSUs deferred, as applicable.

Also under the Director Plan, non-employee directors are awarded annual grants of either RSUs or DSUs that vest fully on the earlier of the first anniversary of grant or the date of the following annual meeting of stockholders. Vesting for these annual RSU and DSU grants is conditional upon continuous service.

Vested DSUs are distributed as shares of common stock on the distribution date elected by the participant and pursuant to the terms of the Director Plan, Suspended Executive Plan or Executive Plan, as applicable.

There were approximately 59,000 and 60,000 vested DSUs outstanding under our share-based compensation plans as of December 31, 2025, and 2024, respectively. During 2025, approximately 900 DSUs were distributed as shares of common stock. Unvested DSUs as of December 31, 2025, and 2024, were not material.

Employee Stock Purchase Rights

Employee stock purchase rights are issued under the 1997 Employee Stock Purchase Plan, under which we reserved and may issue up to an aggregate of 4.7 million shares of common stock in periodic offerings. Under this plan, stock is sold to employees at a 15 % discount off the closing price of the stock on the last day of each quarter. The dollar value of this discount is equal to the fair value of purchase rights recognized as share-based compensation. We issued approximately 33,800 ,  37,700 , and 36,300 shares of common stock in connection with the Employee Stock Purchase Plan during the years ended December 31, 2025, 2024, and 2023, respectively. As of December 31, 2025, there were approximately 0.9 million remaining shares available for issuance under the 1997 Employee Stock Purchase Plan.
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NOTE 6. CREDIT LOSSES

We are exposed to credit losses primarily through our sales of products and services to our customers. We maintain allowances for credit losses for potentially uncollectible receivables. Additional allowances may be required if the financial condition of our customers was to deteriorate or a strengthening U.S. dollar impacts the ability of foreign customers to make payments to us for their U.S. dollar-denominated purchases. We monitor our ongoing credit exposure through active review of counterparty balances against contract terms and due dates, timely account reconciliations, dispute resolution, and payment confirmations. We may employ collection agencies and legal counsel to pursue recovery of defaulted receivables. Account balances are charged off against the allowance when we believe it is probable the receivable will not be recovered. We do not have any off-balance sheet credit exposure related to our customers.

Accounts Receivable

We estimate the allowance for credit losses based on a detailed analysis of specific customer situations and a percentage of our accounts receivable by aging category. Additionally, our estimates are developed based on historical credit loss experience, estimates of recoveries, current economic conditions, and future expectations.

The allowance for credit losses associated with accounts receivable was $ 11.3  million and $ 12.6 million as of December 31, 2025, and 2024, respectively. The amount of accounts receivable reflected on the balance sheets is net of this allowance. As of December 31, 2025, approximately 87 % of our accounts receivable had not yet reached the invoice due date and approximately 13 % were considered past due. As of December 31, 2024, approximately 85 % of our accounts receivable had not yet reached the invoice due date and approximately 15 % were considered past due. Write-offs and recoveries related to credit losses during the years ended December 31, 2025, 2024, and 2023 were not material.

Contract Assets and Lease Receivables

The allowance for credit losses associated with contract assets and lease receivables was $ 8.6  million and $ 6.8  million as of December 31, 2025, and 2024, respectively. The assets reflected on the balance sheet are net of these allowances. Historically, we have experienced low credit loss rates on our customer commitment programs and lease receivables. We estimate the allowance for credit losses based on historical credit loss experience with customer commitment arrangements, changing trends and market conditions, and other relevant factors.

NOTE 7.      INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out) or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation and factors in assumptions of future demand, market conditions, remaining shelf life, or product functionality. When net realizable value is less than cost, we write down the carrying value of inventory for estimated obsolescence by an amount equal to the difference between the cost of inventory and net realizable value. If actual market conditions or results of estimated functionality are less favorable than those we estimated, additional inventory write-downs may be required, which would have a negative effect on our results of operations.

Instrument inventory transferred to property and equipment related to operating lease arrangements with customers was $ 9.9  million, $ 14.2  million, $ 14.6  million during the years ended December 31, 2025, 2024, and 2023, respectively.

The components of inventories were as follows:

(in thousands) December 31, 2025 December 31, 2024
   
Raw materials $ 96,299   $ 104,195  
Work-in-process 32,588   31,907  
Finished goods 248,869   245,775  
Total inventories
$ 377,756   $ 381,877  

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NOTE 8.      LEASE COMMITMENTS

We determine if an arrangement is a lease at its inception. The majority of our facilities are occupied under operating lease arrangements with various expiration dates through 2067, some of which include options to extend the life of the lease, and some of which include options to terminate the lease within one year . In certain instances, we are responsible for the real estate taxes and operating expenses related to these facilities. Additionally, we enter into operating leases for certain vehicles and equipment in the normal course of business.

We determine the expected term of executed agreements using the non-cancelable lease term plus optional renewal terms that we are reasonably certain to exercise. The derived expected term is then used in the determination of a financing or operating lease and in the calculation of straight-line rent expense for our operating leases. Rent escalations are considered in the calculation of minimum lease payments in our finance lease tests and in determining straight-line rent expense for operating leases. Minimum lease payments include the fixed lease component of the agreement, as well as fixed rate increases that are initially measured at the lease commencement date. Variable lease payments based on an index, payments associated with non-lease components, and short-term rentals (leases with terms less than twelve months) are expensed as incurred. Consideration is allocated to the lease and non-lease components based on the estimated standalone prices.

Operating leases are included in operating lease right-of-use assets, accrued liabilities, and long-term operating lease liabilities in our consolidated balance sheets. Financing leases are not material to the financial statements.

Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease liabilities and right-of-use assets are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an explicit rate, we generally use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Rent expense for lease payments is recognized on a straight-line basis over the lease term. The operating lease right-of-use assets also include any rent prepayments, lease incentives received, and straight-line rent expense impacts, which represent the differences between our operating lease liabilities and right-of-use assets.

Maturities of operating lease liabilities are as follows:
(in thousands) December 31, 2025
 
2026 $ 32,104  
2027 29,848  
2028 23,582  
2029 18,616  
2030 11,739  
Thereafter 31,569  
Total lease payments 147,458  
Less imputed interest ( 19,233 )
Total lease liabilities (current and long-term)
$ 128,225  

Total minimum future lease payments for leases that have not commenced as of December 31, 2025, were not material.

December 31, 2025 December 31, 2024

Weighted average remaining lease term - operating leases 7.8 years 8.2 years

Weighted average discount rate - operating leases 4.3   % 4.4   %

Expenses incurred related to operating leases, excluding variable and short-term leases, were approximately $ 36.3 million and $ 32.4 million during the years ended December 31, 2025, and 2024, respectively. Total expenses incurred related to operating leases, including variable rent and short-term leases, were approximately $ 38.3 million and $ 34.0 million for the years ended December 31, 2025, and 2024, respectively.

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Supplemental cash flow information for leases were as follows:
For the Years Ended
December 31,
(in thousands) 2025 2024
 
Cash paid for amounts included in the measurement of operating lease liabilities $ 33,376   $ 27,926  
Right-of-use assets obtained in exchange for operating lease obligations, net of early lease terminations $ 31,385   $ 26,010  

NOTE 9.       PROPERTY AND EQUIPMENT, NET

Property and equipment are stated at cost, net of accumulated depreciation and amortization. The costs of additions and improvements are capitalized, while maintenance and repairs are charged to expense as incurred. When an item is sold or retired, the cost and related accumulated depreciation are relieved, and the resulting gain or loss, if any, is recognized in the consolidated statements of income. We evaluate our property and equipment for impairment as changes in circumstances or the occurrence of events suggest the remaining value is not recoverable from future cash flows. If the carrying value of our property and equipment is impaired, an impairment charge is recorded for the amount by which the carrying value of the property and equipment exceeds its fair value.  We provide for depreciation and amortization, primarily using the straight-line method, by charges to the consolidated statements of income in amounts that allocate the cost of property and equipment over their estimated useful lives as follows:

Asset Classification   Estimated Useful Life
   
Buildings and improvements   10 to 40 years

Leasehold improvements   Shorter of remaining lease term or useful life of improvements
Machinery and equipment   3 to 8 years

Office furniture and equipment   3 to 7 years

Computer hardware and software   3 to 7 years

We capitalize interest on the costs of acquiring and constructing significant assets that require a substantial period of time to be made ready for use. The capitalized interest is included in the cost of the completed asset and depreciated over the estimated useful life of the asset. The amount of interest capitalized during the years ended December 31, 2025, and 2024, was not material.

We capitalize certain costs incurred in connection with developing or obtaining software designated for internal use. Qualifying costs incurred during application development consist primarily of internal payroll, direct fringe benefits, and external direct project costs, including labor and travel. The capitalized costs are amortized on a straight-line basis over the estimated useful life of the asset. Costs incurred during the preliminary project and post-implementation and operation phases are expensed as incurred. These costs relate primarily to the determination of performance requirements, data conversion, and training. Software developed to deliver hosted services to our customers has been designated as internal use.

Property and equipment, net, consisted of the following:

(in thousands) December 31, 2025 December 31, 2024
   
Land and improvements $ 24,636   $ 23,989  
Buildings and improvements 462,393   446,164  
Leasehold improvements 125,304   119,844  
Machinery and equipment 526,696   460,750  
Office furniture and equipment 79,576   80,882  
Computer hardware and software 385,491   349,372  
Construction in progress 68,982   67,144  
Total property and equipment, gross 1,673,078   1,548,145  
Less accumulated depreciation and amortization ( 925,698 ) ( 835,022 )
Total property and equipment, net $ 747,380   $ 713,123  

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Below are the amounts of depreciation and amortization of property and equipment, capitalized computer software for internal use, unpaid property and equipment reflected in accounts payable and accrued expenses, and rental and reagent rental program instruments transferred from inventory to property and equipment:

For the Years Ended December 31,
(in thousands) 2025 2024 2023
     
Depreciation and amortization expense $ 124,947   $ 112,809   $ 100,994  
Capitalization of internal-use software development costs during the period
$ 36,458   $ 38,777   $ 37,120  
Unpaid property and equipment, reflected in accounts payable and accrued liabilities at end of year
$ 15,559   $ 15,036   $ 12,061  
Instruments transferred from inventory to property and equipment during the period for operating lease arrangements with customers (Note 3)
$ 9,929   $ 14,190   $ 14,608  

We had no material impairments of fixed assets for the years ended December 31, 2025, 2024, and 2023.

NOTE 10.      OTHER CURRENT AND LONG-TERM ASSETS

Other current assets consisted of the following:

(in thousands) December 31, 2025 December 31, 2024
   
Contract assets, net (1)
$ 75,828   $ 60,751  
Consideration paid to customers 73,563   61,653  
Taxes receivable 64,985   26,990  
Prepaid expenses 57,900   58,626  
Other 31,347   48,159  
Total other current assets
$ 303,623   $ 256,179  

(1) Contract assets, net, are net of allowances for credit losses.

Other long-term assets consisted of the following:

(in thousands) December 31, 2025 December 31, 2024
   
Contract assets, net (1)
$ 236,906   $ 185,506  
Consideration paid to customers
176,583   134,896  
Equity investments 31,760   31,004  
Deferred income taxes 27,871   125,630  
Investment in long-term product supply arrangements 26,721   26,714  
Other 42,636   43,768  
Total other long-term assets
$ 542,477   $ 547,518  

(1) Contract assets, net, are net of allowances for credit losses.

NOTE 11.      GOODWILL AND INTANGIBLE ASSETS, NET

A significant portion of the purchase price for acquired businesses is generally assigned to intangible assets. Intangible assets other than goodwill are initially valued at fair value. If a quoted price in an active market for the asset is not readily available at the measurement date, the fair value of the intangible asset is estimated based on discounted cash flows using market participant assumptions, which are assumptions that are not specific to IDEXX. The selection of appropriate valuation methodologies and the estimation of discounted cash flows require assumptions about the timing and amounts of future cash flows, risks, appropriate discount rates, and the useful lives of intangible assets. When the value of acquired intangible assets is significant, we typically utilize independent valuation experts to advise and assist us in determining the fair values of the identified intangible assets acquired in connection with a business acquisition and in determining appropriate amortization methods and periods for those intangible assets. Goodwill is initially valued as the excess of the purchase price of a business
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combination over the fair value of acquired net assets recognized, and represents the future economic benefits arising from other assets acquired that are not separately identifiable, including expected synergies with our existing business.

Our business combinations regularly include contingent consideration arrangements that require additional consideration to be paid based on the achievement of established objectives, most commonly related to customer retention or revenue growth during the post-combination period. We assess contingent consideration on the acquisition date to determine whether it is part of the purchase consideration or should be accounted for separately from the business combination. A liability resulting from contingent consideration is remeasured to fair value at each reporting date until the contingency is resolved, with changes in fair value recognized in earnings if changes in estimates are made after the measurement period. Refer to “Note 18. Fair Value Measurements” for the fair value of contingent consideration.

We assess goodwill for impairment at the reporting unit level annually in the fourth quarter, and whenever events or circumstances indicate impairment may exist. In evaluating goodwill for impairment, we have the option to first assess the qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative goodwill impairment test. If, after assessing the totality of events and circumstances, we determine that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then we assess the fair value of the reporting unit and compare its fair value to its carrying value to determine if the carrying value exceeds its fair value. Any excess of the carrying value of the goodwill above its fair value would be recognized as an impairment loss. In contrast, we can opt to bypass the qualitative assessment for any reporting unit and proceed directly to assessing the fair value of a reporting unit, and compare the fair value of the reporting unit to its carrying value to determine if any impairment exists. Doing so does not preclude us from performing the qualitative assessment in any subsequent period.

A prolonged economic downturn that results in lower long-term growth rates and reduced long-term profitability may reduce the fair value of our reporting units. Industry-specific events or circumstances could have a negative impact on our reporting units and may also reduce the fair value of our reporting units. Should such events occur, and it becomes more likely than not that a reporting unit’s fair value has fallen below its carrying value, we will perform an interim goodwill impairment test, in addition to the annual impairment test. Future impairment tests may result in an impairment of goodwill. An impairment of goodwill would be reported as a non-cash charge to earnings.

In the fourth quarter of 2025, we elected to bypass the qualitative assessment and performed a quantitative assessment of the fair value of all our reporting units and compared the fair value of each reporting unit to the carrying value to determine if any impairment exists. We estimated the fair values of applicable reporting units using an income approach based on discounted forecasted cash flows. We applied assumptions about the extent and timing of future cash flows, growth rates, and discount rates. Model assumptions are based on our projections and best estimates, using appropriate and customary market participant assumptions. In addition, we made certain assumptions in allocating shared assets and liabilities to individual reporting units in determining the carrying value of each reporting unit. Goodwill impairments for the year ended December 31, 2025, were immaterial.

As of December 31, 2025, 2024, and 2023, our total goodwill was $ 414.0  million, $ 405.1  million, and $ 366.0  million, respectively. The changes in the carrying amounts of goodwill in our reportable segments for the years ended December 31, 2025, 2024, and 2023, were as follows:

(in thousands) CAG Water LPD
Balance as of December 31, 2022 $ 323,482   $ 17,899   $ 13,883  
Impact of changes in foreign currency exchange rates 2,740   321   1,105  
Balance as of December 31, 2023 $ 326,222   $ 18,220   $ 14,988  
Business combinations 45,782   —   —  
Impact of changes in foreign currency exchange rates ( 5,029 ) ( 109 ) ( 1,505 )
Balance as of December 31, 2024 $ 366,975   $ 18,111   $ 13,483  
Impact of changes in foreign currency exchange rates 7,472   298   1,634  
Balance as of December 31, 2025 $ 374,447   $ 18,409   $ 15,117  

Refer to “Note 4. Acquisitions, Asset Purchases and Investments” for information regarding goodwill and other intangible assets recognized in connection with the acquisition of businesses and other assets during the years ended December 31, 2025, 2024, and 2023.

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We assess the realizability of intangible assets other than goodwill whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If an impairment review is triggered, we evaluate the carrying value of intangible assets, other than goodwill, based on estimated undiscounted future cash flows over the remaining useful life of the primary asset of the asset group and compare that value to the carrying value of the asset group. The asset group is the lowest level for which identifiable cash flows associated with the intangible asset are largely independent. The cash flows that are used contain our best estimates, using appropriate and customary assumptions and projections at the time. If the net carrying value of the asset group exceeds the related estimated undiscounted future cash flows, an impairment loss to adjust the intangible asset to its fair value would be reported as a non-cash charge to earnings. If necessary, we would calculate the fair value of an intangible asset using the present value of the estimated future cash flows to be generated by the intangible asset and apply a risk-adjusted discount rate. We had no impairments of amortizable intangible assets during the years ended December 31, 2025, 2024, and 2023.

We provide for amortization, primarily using the straight-line method, by charges to income in amounts that allocate the intangible assets over their estimated useful lives as follows:

Asset Classification   Estimated Useful Life
   
Customer-related intangible assets (1)
3 to 17 years

Product rights (2)
  5 to 15 years

Noncompete agreements   3 to 5 years

Intangible assets other than goodwill consisted of the following:

(in thousands) December 31, 2025 December 31, 2024
Cost Accumulated Amortization Net Cost Accumulated Amortization Net

Customer-related intangible assets (1)
$ 127,099   $ 54,785   $ 72,314   $ 110,860   $ 44,617   $ 66,243  
Product rights (2)
57,117   22,751   34,366   55,117   14,161   40,956  
Noncompete agreements 6,570   3,407   3,163   6,570   2,093   4,477  
Total intangible assets other than goodwill
$ 190,786   $ 80,943   $ 109,843   $ 172,547   $ 60,871   $ 111,676  

The table above reflect the effects of foreign currency exchange rates, and excludes fully amortized intangible assets.
(1) Customer-related intangible assets comprise customer lists and customer relationships acquired from third parties.
(2) Product rights comprise certain technologies, intellectual property, licenses, and trade names acquired from third parties.

Amortization expense of intangible assets other than goodwill was $ 20.2 million, $ 17.1 million, and $ 13.8 million for the years ended December 31, 2025, 2024, and 2023, respectively.

As of December 31, 2025, the aggregate amortization expense associated with intangible assets is estimated to be as follows for each of the next five years and thereafter:

(in thousands)

2026 $ 20,782  
2027 19,442  
2028 18,032  
2029 12,410  
2030 12,572  
Thereafter 26,605  
Total amortization $ 109,843  
Future actual amortization expense may differ from estimated amounts due to future intangible asset acquisitions, changes in foreign currency exchange rates, impairments of intangible assets, and other events.

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NOTE 12.      ACCOUNTS PAYABLE, ACCRUED LIABILITIES AND OTHER LONG-TERM LIABILITIES

Accounts Payable - Supplier Financing Program

We have an agreement with a third party to provide a supplier financing program, which facilitates participating suppliers’ ability to finance payment obligations from us with a designated third-party financial institution. Participating suppliers may, at their sole discretion, make offers to finance one or more of our payment obligations prior to their scheduled due dates at a discounted price. Our obligations to our suppliers, including amounts due and scheduled payment dates, are not impacted by suppliers’ decisions to finance amounts under these arrangements. The terms of payments are consistent with the terms of our trade payables. Activity related to the obligations is presented within operating activities on the consolidated statements of cash flows.

The changes in our outstanding payment obligations under the supplier financing arrangement, which are included in accounts payable on the consolidated balance sheets, were as follows:

(in thousands) For the Years Ended December 31,
2025 2024
   
Payment obligations outstanding at the beginning of the period $ 5,967   $ 9,057  
     Payment obligation additions during the period
56,475   47,422  
     Payment obligations settled during the period
( 56,193 ) ( 50,512 )
Payment obligations outstanding at the end of the period $ 6,249   $ 5,967  

Accrued liabilities consisted of the following:

(in thousands) December 31, 2025 December 31, 2024
   
Accrued employee compensation and related expenses $ 212,444   $ 174,583  
Accrued expenses 114,331   165,550  
Accrued taxes 88,668   62,252  
Accrued customer incentives and refund obligations 87,630   78,195  
Current lease liabilities 27,074   21,539  
Total accrued liabilities
$ 530,147   $ 502,119  

Other long-term liabilities consisted of the following:

(in thousands) December 31, 2025 December 31, 2024
   
Accrued taxes $ 14,452   $ 20,898  
Other accrued long-term expenses 42,075   23,443  
Total other long-term liabilities
$ 56,527   $ 44,341  

NOTE 13.       DEBT

Credit Facility

On October 20, 2022, pursuant to the terms of the Existing Credit Agreement (as defined below), the term lenders thereunder provided us, as borrower, an incremental term loan in an aggregate principal amount of $ 250.0  million (the “Original Term Loan”). On October 20, 2025, upon the maturity of our three-year Original Term Loan under the Existing Credit Agreement, we repaid the principal amount of $ 250.0  million. On November 12, 2025, we, the administrative agent and certain lenders and other parties entered into Amendment No. 2 to our fourth amended and restated credit agreement, as amended by that certain Amendment No. 1 dated as of October 20, 2022 (the “Existing Credit Agreement”, as amended by Amendment No. 2, the “Credit Agreement”). Under our Credit Agreement, there remains an unsecured revolving credit facility in the principal amount of $ 1.0  billion, which matures on November 12, 2030, a three-year unsecured Term Loan in the
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principal amount of $ 250.0  million, which expires on November 12, 2028, and flexibility to incur incremental revolving credit commitments and/or term loans in the aggregate principal amount of up to $ 250.0  million.

Borrowings in U.S. Dollars under our Credit Agreement bear interest at a per annum rate, determined at our option, equal to either: (1) a base rate (determined as the greatest of (i) the prime rate, (ii) the NYFRB Rate plus 0.50 % and (iii) the Adjusted Term SOFR Rate for a one-month Interest Period plus 1 % (but not less than 1 %)), 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. In addition to U.S. Dollar borrowings, borrowings under our Credit Agreement are also available in certain specific foreign currencies, bearing interest based on rates customary for such foreign currencies and subject to the same applicable margin rates based on our consolidated leverage ratio as for our U.S. Dollar borrowings. 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.

Although our revolving line of credit does not mature until November 12, 2030, and our Term Loan does not mature until November 12, 2028, all individual borrowings under the terms of our Credit Facility with an interest rate based on the prevailing Prime or SOFR rate (as selected by the Borrower) have a stated term of less than one year. Our Credit Facility contains a subjective material adverse event notification clause, which allows the debt holders to call the loans under our Credit Facility if we fail to provide prompt written notice to the syndicate of such an event. Based on the stated terms and the existence of the subjective material adverse event clause, this Credit Facility is reflected within current liabilities on our consolidated balance sheets.

As of December 31, 2025, we had $ 398.0  million in borrowings outstanding under our Credit Facility, of which $ 250.0  million is the Term Loan, with a weighted average effective interest rate of 5.3 %, excluding any impact of our interest rate swap. As of December 31, 2024, we had $ 250.0  million in borrowings outstanding under our Credit Facility, all of which is the $ 250.0  million Term Loan, with a weighted average effective interest rate of 6.2 %, excluding any impact of our interest rate swap. The funds available under our Credit Facility reflect a further reduction due to the issuance of letters of credit, which were primarily issued in connection with our workers’ compensation policy, for $ 1.8 million and $ 1.9 million in the years ended December 31, 2025, and December 31, 2024, respectively.

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 the Employee Retirement Income Security Act of 1974, the failure to pay specified indebtedness, and a change of control default. 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 sole 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, which is defined as the consolidated leverage ratio under the terms of our Credit Facility, not to exceed 3.5 -to-1. As of December 31, 2025, we were in compliance with the covenants of our Credit Facility.

Senior Notes

The following describes all of our currently outstanding unsecured senior notes issued and sold in private placements (collectively, the “Senior Notes”) as of December 31, 2025:

(Principal Amount in thousands)

Issue Date Due Date Series Principal Amount Coupon Rate Senior Note Agreement

9/4/2014 9/4/2026 2026 Senior Notes $ 75,000   3.72   % NY Life 2014 Note Agreement
4/14/2020 4/14/2030 Prudential 2030 Series D Notes $ 75,000   2.50   % Prudential 2015 Amended Agreement
2/12/2015 2/12/2027 2027 Series B Notes $ 75,000   3.72   % MetLife 2014 Note Agreement
3/14/2019 3/14/2029 2029 Series C Notes $ 100,000   4.19   % MetLife 2014 Note Agreement
4/2/2020 4/2/2030 MetLife 2030 Series D Notes $ 125,000   2.50   % MetLife 2014 Note Agreement

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The following narrative describes our Senior Note activity:

NY Life 2013 and 2014 Note Agreements, Including Amendments

In December 2013, we issued and sold through a private placement an aggregate principal amount of $ 150.0 million of unsecured senior notes consisting of $ 75.0 million of 3.94 % Series A Senior Notes due December 11, 2023 (the “2023 Series A Notes”) and $ 75.0 million of 4.04 % Series B Senior Notes due December 11, 2025 (the “2025 Series B Notes”) under a Note Purchase Agreement among the Company, New York Life Insurance Company, and the accredited institutional purchasers named therein (as amended on April 10, 2020, the “NY Life 2013 Note Agreement”). The aggregate principal amounts of our 2023 Series A Notes and our 2025 Series B Notes, in each case for $ 75.0  million, were repaid in December 2023 and 2025, respectively.

In September 2014, we issued and sold through a private placement an aggregate principal amount of $ 75.0 million of unsecured 3.72 % senior notes due September 4, 2026 (the “2026 Senior Notes”) under a Note Purchase Agreement dated as of July 22, 2014, among the Company, New York Life Insurance Company, and the accredited institutional purchasers named therein (as amended April 10, 2020, the “NY Life 2014 Note Agreement”). We used the proceeds received from the NY Life 2013 and 2014 Notes for general corporate purposes.

On April 10, 2020, we amended the NY Life 2013 Note Agreement and the NY Life 2014 Note Agreement by entering into two Amendments to the Note Purchase Agreement with New York Life Insurance Company and the other parties thereto, which modified several defined terms, schedules and covenant baskets in the NY Life 2013 Agreement and the NY Life 2014 Note Agreement to create additional operating flexibility, and in particular to align such provisions with similar modifications we made substantially concurrently in our other debt facilities.

Prudential 2015 Amended Agreement, Including Amendments

In July 2014, we issued and sold through a private placement an aggregate principal amount of $ 125.0 million of unsecured senior notes consisting of $ 50.0 million of 3.32 % Series A Senior Notes due July 21, 2021 (the “2021 Series A Notes”) and $ 75.0 million of 3.76 % Series B Senior Notes due July 21, 2024 (the “2024 Series B Notes”) under a Note Purchase and Private Shelf Agreement among the Company, Prudential Investment Management, Inc. (“Prudential”), and the accredited institutional purchasers named therein (the “Prudential 2014 Note Agreement”). The aggregate principal amount of our 2021 Series A Notes for $ 50.0 million was repaid in July 2021. The aggregate principal amount of our 2024 Series B Notes for $ 75.0  million was repaid in July 2024.

In June 2015, we entered into an Amended and Restated Multi-Currency Note Purchase and Private Shelf Agreement (the “Original Prudential 2015 Amended Agreement”), among the Company, Prudential, and the accredited institutional purchasers named therein, which amends and restates the Prudential 2014 Note Agreement. Pursuant to the Original Prudential 2015 Amended Agreement, we issued and sold through a private placement an aggregate principal amount of € 88.9 million of unsecured 1.785 % Series C Senior Notes due June 18, 2025 (the “2025 Series C Notes”). The aggregate principal amount of our 2025 Series C Notes for € 88.9  million (US$ 103.4  million) was repaid in June 2025.

On May 9, 2019, we entered into the Amendment to Note Purchase and Private Shelf Agreement (the “Prudential First Amendment”) with Prudential and the other parties thereto, which amended certain reporting provisions in the Original Prudential 2015 Amended Agreement.

On April 10, 2020, we entered into the Second Amendment to the Prudential 2015 Amended Agreement (the “Prudential Second Amendment”), in order to (i) increase the facility size to $ 425.0 million, (ii) extend the facility issuance period to April 10, 2023, (iii) make various implementing and administrative changes in order to facilitate the $ 75.0 million notes issuance on April 14, 2020, (iv) allow the amount available to be issued under the facility to equal $ 425.0 million less the amount of notes outstanding from time to time during the issuance period, and (v) modify several defined terms, schedules and covenant baskets in the Original Prudential 2015 Amended Agreement, as amended by the Prudential First Amendment, to create additional operating flexibility, and in particular to align such provisions with similar modifications we made substantially concurrently in our other debt facilities. We refer to the Original Prudential 2015 Agreement, as amended by the Prudential First Amendment and the Prudential Second Amendment, as the “Prudential 2015 Amended Agreement.”

On April 14, 2020, we issued and sold to Prudential and other purchasers $ 75.0 million of our unsecured senior notes (the “Prudential 2030 Series D Notes”) pursuant to the Prudential Second Amendment. The entire outstanding balance of the
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Prudential 2030 Series D Notes is due and payable on April 14, 2030, and the Prudential 2030 Series D Notes bear interest at the rate of 2.50 % per annum. We used the proceeds received from the Prudential 2030 Series D Notes for general corporate purposes.

MetLife 2014 Note Agreement, Including Amendments

We entered into a Multicurrency Note Purchase and Private Shelf Agreement, dated as of December 19, 2014 (the “Original MetLife 2014 Note Agreement”), among the Company, Metropolitan Life Insurance Company (“MetLife”), and the accredited institutional purchasers named therein pursuant to which we agreed to issue and sell an aggregate principal amount of $ 150.0 million of unsecured senior notes consisting of $ 75.0 million of our 3.25 % Series A Senior Notes having a seven-year term (the “2022 Series A Notes”), and $ 75.0 million of our 3.72 % Series B Senior Notes having a twelve-year term (“2027 Series B Notes”). The issuance, sale and purchase of these notes occurred in February 2015. The aggregate principal amount of our 2022 Series A Notes for $ 75.0 million was repaid in February 2022.

On March 14, 2019, we amended the Original MetLife 2014 Note Agreement. Pursuant to the Original MetLife 2014 Note Agreement, as so amended, we issued and sold through a private placement an aggregate principal amount of $ 100.0 million of unsecured senior notes at a 4.19 % per annum rate, due March 14, 2029 (the “2029 Series C Notes”).

On March 23, 2020, we entered into the Second Amendment to the Original MetLife 2014 Note Agreement (the “MetLife Second Amendment”), in order to (i) increase the facility size from $ 150.0 million to $ 300.0 million, (ii) extend the facility issuance period to December 20, 2022, (iii) make various implementing and administrative changes in order to facilitate the $ 125.0 million notes issuance on April 2, 2020, and (iv) allow the amount available to be issued under the facility to equal $ 300.0 million, less the amounts outstanding on 2029 Series C Notes and MetLife 2030 Series D Notes.

On April 2, 2020, we issued and sold to MetLife and other purchasers $ 125.0 million of our unsecured senior notes (the “MetLife 2030 Series D Notes”) pursuant to the MetLife Second Amendment. The entire outstanding principal balance of the MetLife 2030 Series D Notes is due and payable on April 2, 2030, and the MetLife 2030 Series D Notes bear interest at the rate of 2.50 % per annum. We used the proceeds received from the MetLife 2030 Series D Notes for general corporate purposes.

We refer to the Original MetLife 2014 Agreement, as so amended, as the “MetLife 2014 Agreement,” and together with the NY Life 2013 Note Agreement, NY Life 2014 Note Agreement, and Prudential 2015 Amended Note Agreement, collectively, as the “Senior Note Agreements.”

Senior Note Agreements

The Senior Note Agreements contain affirmative, negative, and financial covenants customary for agreements of this type. The negative covenants include restrictions on liens, indebtedness of our subsidiaries, priority indebtedness, fundamental changes, investments, transactions with affiliates, certain restrictive agreements, and violations of sanctions laws and regulations. The sole 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, not to exceed 3.5 -to-1. As of December 31, 2025, we were in compliance with the covenants of the Senior Note Agreements.

Should we elect to prepay the Senior Notes, such aggregate prepayment will include the applicable make-whole amount(s), as defined within the applicable Senior Note Agreements. Additionally, in the event of a change in control of the Company or upon the disposition of certain assets of the Company the proceeds of which are not reinvested (as defined in the Senior Note Agreements), we may be required to prepay all or a portion of the Senior Notes. The obligations under the Senior Notes may be accelerated upon the occurrence of an event of default under the applicable Senior Note Agreement, 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, the failure to pay specified indebtedness, and a change of control default.

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Future maturities of long-term debt as of December 31, 2025, are as follows:

(in thousands)

Years Ending December 31, Amount
 
2026 $ 75,000  
2027 75,000  
2028 —  
2029 100,000  
2030 200,000  
Total future maturities of long-term debt
$ 450,000  

Total interest paid on all debt (including our Credit Facility) for the years ended December 31, 2025, 2024, and 2023, was $ 37.7 million, $ 33.8 million, and $ 41.0 million, respectively.

NOTE 14.      INCOME TAXES

The provision for income taxes is determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred taxes 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. We record a valuation allowance to reduce our deferred tax assets to the amount that is more-likely-than-not to be realized. In assessing the need for a valuation allowance, we consider future taxable income and ongoing prudent and feasible tax planning strategies. In the event that we determine that we would be able to realize our deferred tax assets in the future in excess of the net recorded amount, a reduction of the valuation allowance would increase income in the period such determination was made. Likewise, should we determine that we would not be able to realize all or part of our net deferred tax asset in the future, a reduction to the deferred tax asset would be charged to income in the period such determination was made.

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. Unrecognized tax benefits are the differences between tax positions taken, or expected to be taken, in tax returns, and the benefits recognized for accounting purposes. We classify uncertain tax positions as long-term liabilities.

Significant judgment is required in determining our worldwide provision for income taxes and our income tax filings are regularly under audit by tax authorities. Any audit result differing from amounts recorded would increase or decrease income in the period that we determine such adjustment is likely. Interest expense and penalties associated with the underpayment of income taxes are included in income tax expense.

Earnings before income taxes were as follows:

(in thousands) For the Years Ended December 31,
2025 2024 2023
     
Domestic $ 1,057,551   $ 897,336   $ 889,133  
International 266,638   212,495   172,043  
Total earnings before income tax
$ 1,324,189   $ 1,109,831   $ 1,061,176  

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The provision (benefit) for income taxes comprised the following:

(in thousands) For the Years Ended December 31,
2025 2024 2023
Current      
Federal $ 61,678   $ 168,042   $ 191,274  
State 29,253   37,112   40,369  
International 42,590   41,004   32,797  
Total current tax provision
133,521   246,158   264,440  
Deferred
Federal 116,893   ( 24,642 ) ( 36,501 )
State 9,276   ( 4,709 ) ( 6,462 )
International 5,035   5,157   ( 5,343 )
Total deferred tax provision
131,204   ( 24,194 ) ( 48,306 )
Total income tax provision
$ 264,725   $ 221,964   $ 216,134  

The following table is a reconciliation of the U.S. federal statutory rate of 21% to our effective rate for the year ended December 31, 2025:

in thousands, except percentages
For the Year Ended
December 31, 2025

U.S. federal statutory rate $ 278,080   21.0   %
Federal:
Effects of cross-border tax laws ( 8,316 ) ( 0.6 )
Tax credits ( 13,752 ) ( 1.1 )
Nontaxable or nondeductible items:
Tax benefits from share-based compensation ( 24,370 ) ( 1.8 )
Other 7,366   0.5  
Changes in unrecognized tax benefits ( 8,287 ) ( 0.6 )
Other adjustments, net ( 1,657 ) ( 0.1 )
State and local income tax, net of federal income tax effects (1)
33,149   2.5  
Foreign tax effect 2,512   0.2  
Effective tax rate $ 264,725   20.0   %

(1) The jurisdictions that comprise the majority (greater than 50%) of the total state and local income tax effects are California, Florida, Illinois, New Jersey, New York, and Pennsylvania
.

The following table is a reconciliation of the U.S. federal statutory rate of 21% to the Company’s effective rate for the years ended December 31, 2024 and 2023:

For the Years Ended
December 31,

2024 2023
   
U.S. federal statutory rate 21.0   % 21.0   %
State and local income tax, net of federal income tax effects
2.4   2.7  
Taxation on international earnings ( 0.2 ) ( 0.1 )
Foreign-Derived Intangible Income ( 1.3 ) ( 1.4 )
Tax benefits from share-based compensation
( 1.8 ) ( 1.3 )
Tax credits
( 1.0 ) ( 1.2 )
Other adjustments, net
0.9   0.7  
Effective tax rate 20.0   % 20.4   %

Our effective income tax rates were 20.0 %, 20.0 %, and 20.4 % for the years ended December 31, 2025, 2024, and 2023, respectively. 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.
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The following table presents income taxes paid, net of refunds received, for the year ended December 31, 2025:

For the Year Ended
December 31, 2025

 
U.S. federal
$ 94,266  
U.S. state and local
34,517  
Foreign:

Netherlands
9,675  
Switzerland
10,047  
Other
18,993  
Total income taxes paid
$ 167,498  

Income taxes paid, net of refunds received, for the periods ended December 31, 2024 and 2023, were $ 307.2 million and $ 192.5 million, respectively.

We have determined that unremitted earnings are not indefinitely reinvested to the extent they can be distributed without incurring a significant tax liability. As such, we have recorded a deferred tax liability for foreign withholding tax that will be incurred with respect to the unremitted earnings upon repatriation. We consider all other outside basis differences to be indefinitely reinvested to the extent reversal would incur a significant tax liability. It is not practicable to calculate a deferred tax liability related to such outside basis differences.

The components of the net deferred tax assets (liabilities) included in the accompanying consolidated balance sheets were as follows:

(in thousands) December 31, 2025 December 31, 2024
   
Assets    
Accrued expenses $ 40,831   $ 56,325  
Allowances for credit losses for potentially uncollectable receivables
3,516   3,444  
Deferred revenue 9,955   5,743  
Inventory basis differences 28,246   24,040  
Property-based differences 11,510   16,802  
Intangible asset basis differences 45,384   41,628  
Share-based compensation 14,787   14,335  
Other 3,803   1,878  
Net operating loss carryforwards 5,314   6,647  
Tax credit carryforwards 16,163   13,382  
Unrealized losses on foreign currency exchange contracts and investments 4,393   1,357  
Research and development expenditure differences 2,022   92,856  
Total assets 185,924   278,437  
Valuation allowance ( 36,164 ) ( 31,927 )
Total assets, net of valuation allowance 149,760   246,510  

Liabilities
Customer acquisition costs ( 62,642 ) ( 46,892 )
Property-based differences ( 61,622 ) ( 53,332 )
Intangible asset basis differences ( 15,325 ) ( 10,443 )
Other ( 13,097 ) ( 14,867 )
Unrealized gains on foreign currency exchange contracts and investments ( 1,068 ) ( 6,658 )
Total liabilities ( 153,754 ) ( 132,192 )
Net deferred tax assets (liabilities) $ ( 3,994 ) $ 114,318  

As of December 31, 2025, we recorded valuation allowances against certain deferred tax assets related to temporary differences, including intangible asset basis differences, and net operating loss (“NOL”) and tax credit carryforwards, because we believe it is more-likely-than-not that they will not be realized or utilized within the carryforward period.
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The following table summarizes the changes in valuation allowances for deferred tax assets:

(in thousands) For the Years Ended December 31,
2025 2024 2023
     
Balance at beginning of year $ 31,927   $ 34,793   $ 39,726  
Increases due to current activities and changes in estimates
135   698   21  
Decreases due to expirations and changes in estimates
—   ( 1,289 ) ( 7,846 )
Foreign currency translation 4,102   ( 2,275 ) 2,892  
Balance at the end of the year $ 36,164   $ 31,927   $ 34,793  

As of December 31, 2025, we have NOLs in certain state and international jurisdictions of approximately $ 22.5 million available to offset future taxable income. The majority of our NOL carryforwards have indefinite lives. As of December 31, 2025, we also have state tax credit carryforwards of $ 20.2  million that will expire between 2028 and 2044.

The following table summarizes the changes in unrecognized tax positions:

(in thousands) For the Years Ended December 31,
2025 2024 2023
     
Total amounts of unrecognized tax benefits, beginning of period $ 18,146   $ 22,320   $ 22,547  
Gross increases in unrecognized tax positions as a result of tax positions taken during a prior period
891   41   6,366  
Gross increases in unrecognized tax positions as a result of tax positions taken in the current period 5,231   3,034   3,987  
Decreases in unrecognized tax positions related to settlements with taxing authorities
( 9,008 ) ( 678 ) ( 7,535 )
Decreases in unrecognized tax positions as a result of a lapse of the applicable statutes of limitations ( 2,606 ) ( 6,571 ) ( 3,045 )
Total amounts of unrecognized tax benefits, end of period $ 12,654   $ 18,146   $ 22,320  

Of the total unrecognized tax benefits as of December 31, 2025, 2024, and 2023, $ 12.7 million, $ 17.4 million, and $ 21.2 million, respectively, comprise unrecognized tax positions that would, if recognized, affect our effective tax rate.

During the years ended December 31, 2025, 2024, and 2023, we recorded interest expense and penalties related to income taxes of $ 0.2 million, $ 1.7 million, and $ 2.9 million, respectively, as income tax expense in our consolidated statements of income. As of December 31, 2025, 2024, and 2023, we had $ 0.3 million, $ 2.9 million, and $ 3.8 million, respectively, of estimated interest expense and penalties accrued in our consolidated balance sheets.

In the ordinary course of our business, our income tax filings are regularly under audit by tax authorities. While we believe we have appropriately provided for all uncertain tax positions, amounts asserted by taxing authorities could be greater or less than our accrued position. Accordingly, additional provisions on income tax matters, or reductions of previously accrued provisions, could be recorded in the future if we revise our estimates due to changing facts and circumstances or the underlying matters are settled or otherwise resolved. We are currently under tax examinations in various jurisdictions, none of which are material to the consolidated financial statements. We generally are no longer subject to income tax examinations for years before 2020 in any jurisdiction in which we conduct significant taxable activities.

NOTE 15.      EARNINGS PER SHARE

Basic earnings per share is computed by dividing net income attributable to our stockholders by the weighted average number of shares of common stock and vested deferred stock units outstanding during the year. The computation of diluted earnings per share is similar to the computation of basic earnings per share, except that the denominator is increased for the assumed exercise of dilutive options and assumed issuance of unvested restricted stock units and unvested deferred stock units using the treasury stock method unless the effect is anti-dilutive. The treasury stock method assumes that proceeds, including cash received from the exercise of employee stock options and the total unrecognized compensation expense for unvested share-based compensation awards, would be used to purchase our common stock at the average market price during the period. Vested deferred stock units outstanding are included in shares outstanding for basic and diluted earnings per share
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because the associated shares of our common stock are issuable for no cash consideration, the number of shares of our common stock to be issued is fixed, and issuance is not contingent. Refer to “Note 5. Share-Based Compensation” for additional information regarding deferred stock units.

The following is a reconciliation of weighted average shares outstanding for basic and diluted earnings per share:

(in thousands) For the Years Ended December 31,
2025 2024 2023
     
Shares outstanding for basic earnings per share: 80,427   82,467   83,066  

Shares outstanding for diluted earnings per share:
Shares outstanding for basic earnings per share 80,427   82,467   83,066  
Dilutive effect of share-based payment awards 598   779   912  
Total shares outstanding for basic and diluted earnings per share
81,025   83,246   83,978  

Certain awards and options to acquire shares have been excluded from the calculation of shares outstanding for diluted earnings per share because they were anti-dilutive. The following table presents information concerning those anti-dilutive awards and options:

(in thousands) For the Years Ended December 31,
2025 2024 2023
     
Weighted average number of shares underlying anti-dilutive options 356   469   381  
Weighted average number of shares underlying anti-dilutive awards 1   38   1  

NOTE 16.      COMMITMENTS, CONTINGENCIES AND GUARANTEES

Commitments

Refer to “Note 8. Lease Commitments” for more information regarding our lease commitments.

In the ordinary course of business we enter into 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.

Contingencies

We are subject to claims that may arise in the ordinary course of business, including with respect to actual and threatened litigation and other matters. We accrue for loss contingencies when it is probable that future expenditures will be made, and such expenditures can be reasonably estimated. However, the results of legal actions cannot be predicted with certainty, and therefore our actual losses with respect to these contingencies could exceed our accruals. Our accruals with respect to actual and threatened litigation were not material as of December 31, 2025.

In 2018, a lawsuit was filed against us involving an alleged breach of contract for underpayment of royalty payments made from 2004 through 2017 under an expired patent license agreement. The plaintiff asserted a claim of approximately $ 50.0  million, inclusive of interest through June 30, 2020, alleging that the incorrect royalty provision was applied to certain licensed products and services throughout the agreement term and that royalties were also due on non-licensed diagnostic services that were provided concurrently with licensed services. The trial court ruled in favor of the plaintiff in September 2020. The appellate court reversed the trial court’s decision regarding the royalty payments in August 2022. In June 2024, the state supreme court reversed the appellate court, reinstated the trial court decision regarding the royalty payments, and remanded the case to the appellate court to address the remaining issues, including issues related to applicable interest. On April 3, 2025, the appellate court affirmed the trial court’s decision regarding all remaining issues. In light of the appellate court’s decision, on
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April 17, 2025, we paid the judgment in the amount of approximately $ 80.0  million, which was accrued in prior years, and the plaintiff executed a satisfaction and release of judgment, which was filed with the trial court, concluding this matter.

From time to time, we have received notices alleging that our products infringe third-party proprietary rights, although we are not aware of any pending litigation with respect to such claims. Patent litigation is frequently complex and expensive, and the outcome of patent litigation can be difficult to predict. There can be no assurance that we will prevail in any infringement proceedings that may be commenced against us. If we lose any such litigation, we may be stopped from selling certain products and/or we may be required to pay damages as a result of the litigation.

Guarantees

We enter into agreements with third parties 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 potential indemnification under these agreements is minimal. Accordingly, we have recorded no liabilities for these obligations as of December 31, 2025, and 2024.

When acquiring a business, we sometimes assume liability for certain events or occurrences that took place prior to the date of acquisition. As of December 31, 2025, and 2024, we do not have any material pre-acquisition liabilities recorded.

NOTE 17.       SEGMENT REPORTING

We have three reportable segments: Companion Animal Group (“CAG”), water quality products (“Water”), and Livestock, Poultry and Dairy (“LPD”). CAG provides products and services for veterinarians and the biomedical research community, primarily related to diagnostics and information management. Water provides innovative testing solutions for the detection and quantification of various microbiological parameters in water. 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. Our Other operating segment combines and presents our human medical diagnostic business with our out-licensing arrangement because they do not meet the quantitative or qualitative thresholds for reportable segments. Our human medical diagnostic business develops, manufactures, and distributes human medical diagnostic products and services.

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision-maker (“CODM”) in assessing performance. The CODM, our president and Chief Executive Officer, evaluates the performance of operating segments based on revenues and gross profit. Our CODM reviews the budget and actual financial results of the operating segments and decides how to allocate resources to meet our strategic priorities, and he also meets with operating segment leaders on a periodic basis to determine the allocation of resources.

The accounting principles used in the preparation of the segment information are the same as those used for the consolidated financial statements. Intersegment revenues, which are not included in the tables below, were not material for the years ended December 31, 2025, 2024, and 2023. Refer to “Note 3. Revenue” for a summary of disaggregated revenue by segment and by major product and service category for the years ended December 31, 2025, 2024, and 2023. Assets are not allocated to segments for internal reporting purposes and are not included in the review performed by the CODM for purposes of assessing segment performance and allocation of resources. Certain corporate expenses are allocated to the segments, including depreciation and amortization. Foreign currency transaction gains and losses for all operating segments are reported within Other and are reconciled in the table below.
    

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The following tables are a summary of reportable segment performance with Other to reconcile to the total consolidated for the years ended December 31, 2025, 2024, and 2023:

(in thousands) For the Year Ended December 31, 2025

CAG Water LPD Total

     
Total revenues from reportable segments $ 3,953,285   $ 201,149   $ 131,787   $ 4,286,221  

Reconciliation of revenue
Other revenues
17,481  
Total consolidated revenue
4,303,702  
Cost of revenue
1,504,611   61,860   67,579  
Segment gross profit $ 2,448,674   $ 139,289   $ 64,208   $ 2,652,171  

Reconciliation of operating profit (segment profit)
Segment gross profit
$ 2,652,171  
Segment operating expenses
( 1,291,101 )
Other operating profit (excluding unallocated amounts)
3,121  
Unallocated amounts

Foreign currency transaction losses, net
( 4,160 )
Interest expense
( 38,852 )
Interest income
3,010  
Income before provision for income taxes $ 1,324,189  

Segment depreciation and amortization expense
$ 130,347   $ 4,760   $ 4,043   $ 139,150  
Other depreciation and amortization expense
6,033  
Total depreciation and amortization expense
$ 145,183  

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(in thousands) For the Year Ended December 31, 2024

CAG Water LPD Total

Total revenues from reportable segments
$ 3,574,044   $ 185,112   $ 122,060   $ 3,881,216  

Reconciliation of revenue

Other revenues
16,288  
Total consolidated revenue
3,897,504  
Cost of revenue
1,394,864   55,101   59,500  
Segment gross profit $ 2,179,180   $ 130,011   $ 62,560   $ 2,371,751  

Reconciliation of operating profit (segment profit)

Segment gross profit
$ 2,371,751  
Segment operating expenses
( 1,242,169 )
Other operating profit (excluding unallocated amounts)
3,282  
Unallocated amounts

Foreign currency transaction losses, net
( 4,527 )
Interest expense
( 31,205 )
Interest income
12,699  
Income before provision for income taxes $ 1,109,831  

Segment depreciation and amortization expense
$ 116,278   $ 4,734   $ 3,802   $ 124,814  
Other depreciation and amortization expense
5,122  
Total depreciation and amortization expense $ 129,936  

(in thousands) For the Year Ended December 31, 2023

CAG Water LPD  Total

Total revenues from reportable segments
$ 3,352,356   $ 168,149   $ 121,659   $ 3,642,164  

Reconciliation of revenue
Other revenues
18,789  
Total consolidated revenue
3,660,953  
Cost of revenue
1,349,930   52,148   56,219  
Segment gross profit $ 2,002,426   $ 116,001   $ 65,440   $ 2,183,867  

Reconciliation of operating profit (segment profit)

Segment gross profit
$ 2,183,867  
Segment operating expenses
( 1,086,812 )
Other operating profit (excluding unallocated amounts)
1,151  
Unallocated amounts

Foreign currency transaction losses, net
( 1,078 )
Interest expense
( 41,581 )
Interest income
5,629  
Income before provision for income taxes $ 1,061,176  

Segment depreciation and amortization expense
$ 103,554   $ 4,117   $ 3,657   $ 111,328  
Other depreciation and amortization expense
3,580  
Total depreciation and amortization expense $ 114,908  

F-41

Net long-lived assets, consisting of net property and equipment, are subject to geographic risks because they are generally difficult to move and to effectively utilize in another geographic area in a reasonable time period and because they are relatively illiquid. Net long-lived assets by principal geographic areas were as follows:

(in thousands) For the Years Ended December 31,

2025 2024
Americas
   
United States $ 575,089   $ 553,600  
Brazil 20,532   22,139  
Canada 9,140   8,165  
Total Americas
604,761   583,904  

Europe, the Middle East, and Africa

Germany 56,780   52,652  
Switzerland 14,883   14,722  
United Kingdom 13,560   11,137  
Netherlands 10,500   9,484  
France 2,125   1,769  
Other 3,863   3,058  
Total Europe, the Middle East, and Africa
101,711   92,822  

Asia Pacific

Australia 20,388   19,307  
Japan 10,568   9,382  
Other 9,952   7,708  
Total Asia Pacific
40,908   36,397  

Total assets $ 747,380   $ 713,123  

NOTE 18.      FAIR VALUE MEASUREMENTS

U.S. GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value.

We have certain financial assets and liabilities that are measured at fair value on a recurring basis, certain nonfinancial assets and liabilities that may be measured at fair value on a non-recurring basis, and certain financial assets and liabilities that are not measured at fair value in our consolidated balance sheets but for which we disclose the fair value. The fair value disclosures of these assets and liabilities are based on a three-level hierarchy, which is defined as follows:

Level 1 Quoted prices in active markets for identical assets or liabilities that the entity can access at the measurement date

Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities

Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities

Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. We did not have any transfers between Level 1 and Level 2, or transfers in or out of Level 3, of the fair value hierarchy during the years ended December 31, 2025, and 2024.

Our cross currency swap contracts are measured at fair value on a recurring basis in our accompanying consolidated balance sheets and are classified as derivative instruments. We measure the fair value of our cross currency swap contracts using prevailing market conditions as of the close of business on each balance sheet date. The product of this calculation is then adjusted for counterparty risk.
F-42

Our foreign currency exchange contracts are measured at fair value on a recurring basis in our accompanying consolidated balance sheets and are classified as derivative instruments. We measure the fair value of our foreign currency exchange contracts using an income approach, based on prevailing market forward exchange rates less the contract rate multiplied by the notional amount. The product of this calculation is then adjusted for counterparty risk. 

Our interest rate swap contracts are measured at fair value on a recurring basis in our accompanying consolidated balance sheets and are classified as derivative instruments. We measure the fair value of our interest rate swap contracts using current market interest rates for debt issues with similar remaining years to maturity, adjusted for applicable credit risk.

The amounts outstanding under our unsecured Credit Facility and senior notes (“long-term debt”) are measured at carrying value in our accompanying consolidated balance sheets, though we disclose the fair value of these financial instruments. We determine the fair value of the amount outstanding under our Credit Facility and long-term debt using an income approach, utilizing a discounted cash flow analysis based on current market interest rates for debt issues with similar remaining years to maturity, adjusted for applicable credit risk. Our Credit Facility and long-term debt are valued using Level 2 inputs. The estimated fair value of our Credit Facility approximates its carrying value. As of December 31, 2025, the estimated fair value and carrying value of our long-term debt were $ 444.8 million and $ 450.0 million, respectively. As of December 31, 2024, the estimated fair value and carrying value of our long-term debt were $ 594.3 million and $ 617.8 million, respectively.

F-43

The following tables set forth our assets and liabilities that were measured at fair value on a recurring basis by level within the fair value hierarchy:

(in thousands)
As of December 31, 2025 Quoted Prices in Active Markets for Identical Assets
(Level 1) Significant Other Observable Inputs
(Level 2) Significant Unobservable Inputs
(Level 3) Balance as of December 31, 2025
       
Assets        
Cross currency swaps (1)
$ —   $ 1,700   $ —   $ 1,700  
Foreign currency exchange contracts (1)
$ —   $ 2,793   $ —   $ 2,793  
Liabilities
Cross currency swaps (1)
$ —   $ 13,270   $ —   $ 13,270  
Foreign currency exchange contracts (1)
$ —   $ 6,661   $ —   $ 6,661  
Interest rate swap (2)
$ —   $ 446   $ —   $ 446  
Contingent Consideration
$ —   $ —   $ 1,800   $ 1,800  

(in thousands)
As of December 31, 2024 Quoted Prices in Active Markets for Identical Assets
(Level 1) Significant Other Observable Inputs
(Level 2) Significant Unobservable Inputs
(Level 3) Balance as of December 31, 2024
       
Assets        
Money market funds (3)
$ 139,626   $ —   $ —   $ 139,626  

Cross currency swaps (1)
$ —   $ 3,501   $ —   $ 3,501  
Foreign currency exchange contracts (1)
$ —   $ 16,921   $ —   $ 16,921  
Interest rate swap (2)
$ —   $ 710   $ —   $ 710  
Liabilities
Cross currency swaps (1)
$ —   $ 33   $ —   $ 33  
Contingent Consideration
$ —   $ —   $ 2,300   $ 2,300  

(1) Cross currency swaps and foreign currency exchange contracts are included within other current assets; other long-term assets; accrued liabilities; or other long-term liabilities depending on the gain (loss) position and anticipated settlement date.
(2) Interest rate swaps are included within other long-term assets, or other long-term liabilities.
(3) Money market funds with an original maturity of less than ninety days are included within cash and cash equivalents. The remaining balance of cash and cash equivalents as of December 31, 2024, consisted of demand deposits.

The estimated fair values of certain financial instruments, including cash and cash equivalents, accounts receivable, and accounts payable, approximate their respective carrying values due to their short maturity.  
F-44

NOTE 19.      HEDGING INSTRUMENTS

Disclosure within this note is presented to provide transparency about how and why we use derivative and non-derivative instruments (collectively “hedging instruments”), how the hedging instruments and related hedged items are accounted for, and how the hedging instruments and related hedged items affect our financial position, results of operations, and cash flows.

We recognize all hedging instrument assets and liabilities on the balance sheet at fair value at the balance sheet date. Hedging instruments that do not qualify for hedge accounting treatment are recorded at fair value through earnings. To qualify for hedge accounting treatment, hedging instruments must be highly effective in offsetting changes to expected future cash flows or fair value on hedged transactions. If the 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 AOCI, 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 hedging instrument is not effective in achieving offsetting changes in fair value. We de-designate hedging instruments from hedge accounting when the likelihood of the hedged transaction occurring becomes less than probable. For de-designated hedging instruments, the gain or loss from the time of de-designation through maturity of the instrument is recognized in earnings. Any gain or loss in AOCI at the time of de-designation is reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Refer to “Note 21. Accumulated Other Comprehensive Income” for further information regarding the effect of hedging instruments on the consolidated statements of income for the years ended December 31, 2025, 2024, and 2023.

We enter into master netting arrangements with the counterparties to our derivative transactions which permit certain outstanding receivables and payables to be offset in the event of default. Our derivative contracts do not require either party to post cash collateral. We elect to present our derivative assets and liabilities in the accompanying consolidated balance sheets on a gross basis. All cash flows related to our foreign currency exchange contracts are classified as operating cash flows, which is consistent with the cash flow treatment of the underlying items being hedged. 

We have entered into interest rate swaps to manage the impact of interest rate fluctuations associated with our $ 250.0  million of borrowings under the variable-rate Credit Facility. We have designated the interest rate swaps as a cash flow hedge.

Our subsidiaries enter into foreign currency exchange contracts to manage the exchange risk associated with their forecast 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 minimize the impact of foreign currency fluctuations associated with specific balance sheet exposures, including net investments in certain foreign subsidiaries.

The primary purpose of our foreign currency hedging activities is to protect against the volatility associated with foreign currency transactions, including transactions denominated in euro, British pound, Japanese yen, Canadian dollar, and Australian dollar. 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.

Refer to “Note 18. Fair Value Measurements” for additional information regarding the fair value of our derivative instruments and “Note 21. Accumulated Other Comprehensive Income” for additional information regarding the effect of derivative instruments designated as cash flow hedges on the consolidated statements of income.     

Cash Flow Hedges

We have designated our foreign currency exchange contracts and our interest rate swaps as cash flow hedges because these derivative instruments reduce our exposure to variability in the cash flows of forecasted transactions attributable to foreign currency exchange and to interest rates on variable interest obligations of our Term Loan. Unless noted otherwise, we have also designated our derivative instruments as qualifying for hedge accounting treatment.

We did not de-designate any instruments from hedge accounting treatment during the years ended December 31, 2025, 2024, and 2023. Gains and losses related to hedge ineffectiveness recognized in earnings during the years ended December 31,
F-45

2025, 2024, and 2023 were not material. As of December 31, 2025, the estimated amount of losses, net of tax, from our foreign exchange contracts which are expected to be reclassified out of AOCI and into earnings within the next twelve months is $ 2.5 million if exchange rates do not fluctuate from the levels as of December 31, 2025. As of December 31, 2025, the estimated amount of gains, net of tax, from our interest rate swap contract which are expected to be reclassified out of AOCI and into earnings within the next twelve months is $ 0.3  million if interest rates do not fluctuate from the levels as of December 31, 2025.

Interest Rate Swaps : We enter into interest rate swap contracts to reduce the effect of variable interest obligations of our Term Loan. Beginning in November 2025 through November 2028, the variable interest rate associated with $ 250.0  million of borrowings outstanding under our Credit Facility became effectively fixed at 3.4 % plus the applicable credit spread. Our previous interest rate swap contract, from March 2023 through October 2025, on the variable interest rate associated with the $ 250.0  million of borrowings under our Credit Facility, was effectively fixed at 3.9 % plus the applicable credit spread.

Foreign Currency Exchange Contracts : 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 emerging markets where it is not practical to hedge. We primarily utilize foreign currency exchange contracts with durations of less than 24 months. 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 and the notional value of foreign currency exchange contracts may vary throughout the year. The U.S. dollar is the currency purchased or sold in all of our foreign currency exchange contracts. The notional amount of foreign currency exchange contracts to hedge forecasted intercompany inventory purchases and sales totaled $ 397.6 million and $ 325.7 million as of December 31, 2025, and 2024, respectively.

The following table presents the effects of cash flow hedge accounting on our consolidated statements of income and comprehensive income, and provides information regarding the location and amounts of pretax gains or losses of derivatives: 

(in thousands)   For the Years Ended December 31,

  2025 2024 2023
Financial statement line items in which effects of cash flow hedges are recorded
Foreign exchange contracts Cost of revenue $ 1,644,123   $ 1,518,577   $ 1,470,983  
Amount of gain (loss) reclassified from accumulated other comprehensive income into income
$ ( 801 ) $ 5,932   $ 3,512  

Interest rate swap contract Interest expense $ ( 38,852 ) $ ( 31,205 ) $ ( 41,581 )
Amount of gain reclassified from accumulated other comprehensive income into net income $ 1,145   $ 3,268   $ 2,656  

Net Investment Hedges, Euro-Denominated Notes

In June 2015, we issued and sold through a private placement an aggregate principal amount of € 88.9 million in euro-denominated 1.785 % Series C Senior Notes that were due June 18, 2025. We designated these euro-denominated notes as a hedge of our euro net investment in certain foreign subsidiaries to reduce the volatility caused by changes in foreign currency exchange rates in the euro relative to the U.S. dollar. As a result of this designation, gains and losses from the change in the translated U.S. dollar value of these euro-denominated notes are recorded in AOCI rather than earnings. At the maturity of the 1.785 % Series C Senior Notes in June 2025, we paid the notional amount of € 88.9 million, equivalent to $ 103.4  million at the date of payment. We recorded a loss of $ 9.0 million (including the net of tax loss from the June 18, 2025 settlement), a gain of $ 4.1 million, and a loss of $ 2.6 million, net of tax, within AOCI as a result of net investment hedge activity for the years ended December 31, 2025, 2024, and 2023, respectively. The related cumulative unrealized loss of $ 2.5  million, net of tax, will be reclassified to earnings when the foreign subsidiaries are sold or substantially liquidated. Refer to “Note 13. Debt” to the consolidated financial statements included in this Annual Report on Form 10-K for further information regarding the issuance of these euro-denominated notes. 
F-46

Net Investment Hedges, Cross Currency Swaps

We have entered into cross currency swap contracts as a hedge of our net investment in certain foreign subsidiaries to reduce the volatility caused by changes in foreign currency exchange rates relative to the U.S. dollar. The cross currency swaps outstanding as of December 31, 2025, have maturity dates beginning on March 31, 2028, through September 11, 2032.

The following table presents the outstanding cross currency swaps notional amounts that will be delivered to and received from the counterparties at maturity:

(in thousands)
Maturity Date
Notional Amount to be Delivered at Maturity
Notional Amount to be Received at Maturity
3/31/2028 € 35,000   $ 37,755  
6/30/2028 € 90,000   $ 98,217  
6/29/2029 € 20,000   $ 21,268  
7/17/2028 € 76,000   $ 88,113  
7/31/2028 € 39,000   $ 45,735  
9/11/2032 ¥ 3,683,750   $ 25,000  

In June 2025, we settled two cross currency swaps at maturity for a total notional amount of € 15  million. As a result of this settlement, we received a net amount of $ 0.1  million.

The changes in fair value of the cross currency swap contracts are recorded in AOCI and will be reclassified to earnings when the foreign subsidiaries are sold or substantially liquidate d or all or a portion of the hedge no longer qualifies for hedge accounting treatment. We recorded a loss of $ 11.4 million, a gain of $ 6.0 million, and a loss of $ 5.6 million, net of tax, within AOCI as a result of these net investment hedges, during the years ended December 31, 2025, 2024, and 2023, respectively. We receive quarterly interest payments from the counterparties based on a fixed interest rate until maturity of the cross currency swaps. This interest rate component is excluded from the assessment of hedge effectiveness and is recognized as a reduction to interest expense over the life of the hedge instrument. We recognized approximately $ 2.7 million, $ 1.6 million, and $ 2.1 million related to the excluded component as a reduction of interest expense for the years ended December 31, 2025, 2024, and 2023, respectively.    

Fair Values of Hedging Instruments Designated as Hedges in Consolidated Balance Sheets

The fair values of hedging instruments, their respective classification on the consolidated balance sheets and the amounts subject to offset under master netting arrangements consisted of the following:

(in thousands)   Hedging Assets
  December 31, 2025 December 31, 2024
     
Derivatives and non-derivatives designated as hedging instruments Balance Sheet Classification    
Foreign currency exchange contracts Other current assets $ 2,793   $ 16,921  
Cross currency swaps Other current assets —   1,839  
Interest rate swap contract Other long-term assets —   710  
Cross currency swaps Other long-term assets 1,700   1,662  

Total derivative instruments presented as hedging instruments on the balance sheet 4,493   21,132  
Gross amounts subject to master netting arrangements not offset on the balance sheet ( 1,941 ) —  
Net amount   $ 2,552   $ 21,132  

F-47

(in thousands)   Hedging Liabilities
  December 31, 2025 December 31, 2024
     
Derivatives and non-derivatives designated as hedging instruments Balance Sheet Classification    
Foreign currency exchange contracts Accrued liabilities $ 6,661   $ —  
Cross currency swaps Other long-term liabilities 13,270   33  
Interest rate swap contract Other long-term liabilities 446   —  
Total derivative instruments presented as cash flow hedges on the balance sheet 20,377   33  
Non-derivative foreign currency denominated debt designated as net investment hedge on the balance sheet (1)
Long-term debt —   92,803  
Total hedging instruments presented on the balance sheet 20,377   92,836  
Gross amounts subject to master netting arrangements not offset on the balance sheet ( 1,941 ) —  
Net amount   $ 18,436   $ 92,836  

(1) Amounts represent reported carrying amounts of our foreign currency denominated debt. Refer to “Note 18. Fair Value Measurements” for information regarding the fair value of our long-term debt.

NOTE 20.      REPURCHASES OF COMMON STOCK

As of December 31, 2025, our Board of Directors has authorized the repurchase of up to 78.0 million shares of our common stock in the open market or in negotiated transactions pursuant to the Company’s share repurchase program. We believe that the repurchase of our common stock is a favorable means of returning value to our stockholders, and we also repurchase to offset the dilutive effect of our share-based compensation programs. Repurchases of our common stock may vary depending upon the level of other investing and deployment activities, as well as share price and prevailing interest rates. As of December 31, 2025, there were approximately 3.7 million remaining shares available for repurchase under this authorization.

We primarily acquire shares of our common stock by repurchases in the open market. We also acquire shares that are surrendered by employees in payment for the statutory withholding taxes due on the vesting of restricted stock units and the settlement of deferred stock units, otherwise referred to herein as employee surrenders. We issue shares of treasury stock upon the vesting of certain restricted stock units and upon the exercise of certain stock options. The number of shares of treasury stock issued during the years ended December 31, 2025, 2024, and 2023, was not material.

The Inflation Reduction Act of 2022 imposed a 1% excise tax on the net value of certain stock repurchases, which is included in the cost of treasury stock acquired in open market repurchases. For share repurchases made during the year ended December 31, 2025, we recorded the applicable excise taxes payable of approximately $ 12.1  million in accrued liabilities. During the years ended December 31, 2024 and 2023, we recorded the applicable excise taxes of $ 8.4  million and $ 0.7  million, respectively, which were paid in the year following the repurchase.

We have recognized approximately $ 3.9  million, $ 4.2  million, and $ 0.0  million in accrued liabilities related to the timing of settlements for share repurchases as of December 31, 2025, 2024, and 2023, respectively.
F-48

The following table is a summary of our open market common stock repurchases, reported on a trade date basis, and shares acquired through employee surrenders:

(in thousands, except per share amounts) For the Years Ended December 31,
2025 2024 2023
     
Shares repurchased in the open market 2,411   1,741   155  
Shares acquired through employee surrenders for statutory tax withholding
16   19   20  
Total shares repurchased 2,427   1,760   175  

Cost of shares repurchased in the open market $ 1,220,331   $ 848,901   $ 72,639  
Cost of shares for employee surrenders 7,238   10,531   9,974  
Total cost of shares $ 1,227,569   $ 859,432   $ 82,613  

Average cost per share - open market repurchases $ 506.07   $ 487.66   $ 468.84  
Average cost per share - employee surrenders $ 455.86   $ 556.90   $ 503.28  
Average cost per share - total $ 505.74   $ 488.40   $ 472.74  

F-49

NOTE 21.      ACCUMULATED OTHER COMPREHENSIVE INCOME

The changes in AOCI, net of tax, consisted of the following:

For the Years Ended December 31, 2025 and 2024

Unrealized Gain (Loss) on Cash Flow Hedges, Net of Tax
Unrealized Gain (Loss) on Net Investment Hedges, Net of Tax

(in thousands) Unrealized Gain (Loss) on Investments, Net of Tax
Foreign Currency Exchange Contracts Interest Rate Swap Euro-Denominated Notes Cross Currency Swaps Defined Benefit Plans, Net of Tax Cumulative Translation Adjustment Total
         
Balance as of December 31, 2023 $ ( 164 ) $ ( 2,397 ) $ 1,106   $ 2,346   $ 1,428   $ ( 3,559 ) $ ( 69,966 ) $ ( 71,206 )
Other comprehensive income (loss) before reclassifications
1   19,418   1,927   4,105   5,981   ( 701 ) ( 46,958 ) ( 16,227 )
Amounts reclassified from accumulated other comprehensive income 163   ( 4,236 ) ( 2,491 ) —   —   352   —   ( 6,212 )
Balance as of December 31, 2024 —   12,785   542   6,451   7,409   ( 3,908 ) ( 116,924 ) ( 93,645 )
Other comprehensive income (loss) before reclassifications
—   ( 16,033 ) ( 8 ) ( 8,958 ) ( 11,390 ) 865   59,949   24,425  
Amounts reclassified from accumulated other comprehensive income —   734   ( 872 ) —   —   514   —   376  
Balance as of December 31, 2025 $ —   $ ( 2,514 ) $ ( 338 ) $ ( 2,507 ) $ ( 3,981 ) $ ( 2,529 ) $ ( 56,975 ) $ ( 68,844 )

The following table presents components and amounts reclassified out of AOCI to net income:

(in thousands) Affected Line Item in the Statements of Income Amounts Reclassified from AOCI for the Years Ended December 31,
2025 2024 2023
 
Foreign currency exchange contracts Cost of revenue $ ( 801 ) $ 5,932   $ 3,512  
Provision for income taxes
67   ( 1,696 ) ( 1,068 )
Gains (losses), net of tax
Net income
$ ( 734 ) $ 4,236   $ 2,444  

Interest rate swap contract Interest expense $ 1,145   $ 3,268   $ 2,656  
Provision for income taxes
( 273 ) ( 777 ) ( 631 )
Gains (losses), net of tax
Net income
$ 872   $ 2,491   $ 2,025  

Investments General and administrative expenses
$ —   $ ( 214 ) $ —  
Provision for income taxes
—   51   —  
Gains (losses), net of tax
Net income
$ —   $ ( 163 ) $ —  

Defined benefit plans Cost of revenue and operating expenses $ ( 610 ) $ ( 506 ) $ ( 630 )
Provision for income taxes
96   154   111  
Gains (losses), net of tax
Net income
$ ( 514 ) $ ( 352 ) $ ( 519 )

F-50

NOTE 22.      PREFERRED STOCK

Our Board of Directors is authorized, subject to any limitations prescribed by law, without further stockholder approval, to issue from time to time up to 500,000 shares of Preferred Stock, $ 1.00 par value per share (“Preferred Stock”), in one or more series. Each such series of Preferred Stock shall have such number of shares, designations, preferences, voting powers, qualifications, and special or relative rights or privileges as shall be determined by the Board of Directors, which may include, among others, dividend rights, voting rights, redemption and sinking fund provisions, liquidation preferences, conversion rights, and preemptive rights. There were no shares of Preferred Stock outstanding as of December 31, 2025, and 2024.

NOTE 23.      IDEXX RETIREMENT AND INCENTIVE SAVINGS PLAN

We have established the IDEXX Retirement and Incentive Savings Plan (the “401(k) Plan”). U.S. employees eligible to participate in the 401(k) Plan may contribute specified percentages of their salaries. We match a portion of these contributions, not to exceed 5 % of participants’ eligible compensation. We contributed $ 33.1 million, $ 31.0 million, and $ 30.3 million for the years ended December 31, 2025, 2024, and 2023, respectively. In addition, we may make contributions to the 401(k) Plan at the discretion of the Board of Directors. There were no discretionary contributions in 2025, 2024, or 2023.

We have also established defined contribution plans for regional employees in Europe and in Canada. With respect to these plans, our contributions over the past three years have not been material.

Defined Benefit Pension Obligations

Our Swiss defined benefit pension plans (“Swiss Plans”) are government-mandated retirement plans that provide employees with a minimum investment return. As of December 31, 2025, our Swiss Plans had a net unfunded pension obligation of $ 5.4  million, with a fair value of plan assets of $ 20.7  million. The investments of the plan assets are measured using a mix of Level 1, Level 2, and Level 3 inputs. For the year ended December 31, 2025, we recognized $ 1.8  million in expense related to the Swiss Plans. The expense was reflected in cost of revenue, sales & marketing expense, general and administrative expense, and research and development expense, based on employee classification.

Future benefits expected to be paid as of December 31, 2025, are as follows:

(in thousands) December 31, 2025
 
2026
$ 1,048  
2027
$ 1,276  
2028
$ 1,298  
2029
$ 1,161  
2030
$ 1,371  
2031 through 2035
$ 8,089  

Executive Deferred Compensation Plan

Under the Executive Plan adopted December 6, 2024, certain employees or independent contractors may elect to defer between 5 % and 50 % of their annual base salary and between 5 % and 100 % of their annual bonus, commissions, stock units, or other compensation, unless otherwise specified by the committee administering the Executive Plan. Deferrals of stock units must be made in whole units, with fractional units rounded down to the nearest whole unit before deferral. The Executive Plan is unfunded. The total long-term liability recorded as of December 31, 2025, was $ 2.2  million.
F-51

EXHIBIT INDEX

Incorporated by Reference
Exhibit No. Exhibit Description Form Exhibit Filing Date / Period End Date Filed / Furnished Herewith

Articles of incorporation and by-laws

3.1
Amended and Restated Certificate of Incorporation of the Company, dated May 7, 2025
8-K
3.1
5/09/25

3.2
Amended and Restated By-Laws of IDEXX Laboratories, Inc., amended through May 7, 2025
8-K 3.2 5/09/25

Instruments defining the rights of security holders, including indenture

4.1
Description of the Registrant's Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934

X

4.2
Note Purchase Agreement, dated as of December 11, 2013, among the Company, as issuer, New York Life Insurance Company, New York Life Insurance and Annuity Corporation and New York Life Insurance and Annuity Corporation Institutionally Owned Life Insurance Separate Account (BOLI 30C), as purchasers
8-K 99.1 12/12/13

4.3
Note Purchase and Private Shelf Agreement, dated as of July 21, 2014, among the Company, as issuer, Prudential Investment Management, Inc., Pruco Life Insurance Company, The Prudential Insurance Company of America, The Gibraltar Life Insurance Co., Ltd., PAR U Hartford Life Insurance Comfort Trust, The Independent Order of Foresters, Zurich American Insurance Company, Globe Life and Accident Insurance Company, Family Heritage Life Insurance Company of America, MTL Insurance Company, The Lincoln National Life Insurance Company, William Penn Life Insurance Company of New York, Farmers Insurance Exchange and Mid Century Insurance Company, as purchasers
8-K 99.1 7/25/14

4.4
Note Purchase Agreement, dated as of July 22, 2014, among the Company, as issuer, New York Life Insurance Company, New York Life Insurance and Annuity Corporation and New York Life Insurance and Annuity Corporation Institutionally Owned Life Insurance Separate Account (BOLI 30C), as purchasers
8-K 99.2 7/25/14

4.5
Amendment to Note Purchase Agreement, dated as of April 10, 2020, among the Company, as issuer, New York Life Insurance Company, New York Life Insurance and Annuity Corporation and New York Life Insurance and Annuity Corporation Institutionally Owned Life Insurance Separate Account (BOLI 30C), as purchasers
8-K 10.4 4/16/20

4.6
Amendment to Note Purchase Agreement, dated as of April 10, 2020, among the Company, as issuer, New York Life Insurance Company, New York Life Insurance and Annuity Corporation and New York Life Insurance and Annuity Corporation Institutionally Owned Life Insurance Separate Account (BOLI 30C), as purchasers
8-K 10.5 4/16/20

F-52

4.7
Amended and Restated Multi-Currency Note Purchase and Private Shelf Agreement, dated as of June 18, 2015, among the Company, Prudential Investment Management, Inc., Pruco Life Insurance Company, The Prudential Insurance Company of America, The Gibraltar Life Insurance Co., Ltd., PAR U Hartford Life Insurance Comfort Trust, The Independent Order of Foresters, Zurich American Insurance Company, Globe Life and Accident Insurance Company, Family Heritage Life Insurance Company of America, MTL Insurance Company, The Lincoln National Life Insurance Company, William Penn Life Insurance Company of New York, Farmers Insurance Exchange, Mid Century Insurance Company and Farmers New World Life Insurance Company, as purchasers
8-K 99.1 6/24/15

4.8
Amendment to Amended and Restated Multi-Currency Note Purchase and Private Shelf Agreement, dated as of May 9, 2019, among the Company, as issuer, each of the Subsidiary Guarantors (as defined therein), Prudential and each of the holders of the Notes (as defined therein)
8-K 10.2 4/16/20

4.9
Second Amendment to Amended and Restated Multi-Currency Note Purchase and Private Shelf Agreement, dated as of April 10, 2020, among the Company, as issuer, each of the Subsidiary Guarantors (as defined therein), Prudential and each of the holders of the Notes (as defined therein)
8-K 10.3 4/16/20

4.10
Multicurrency Note Purchase and Private Shelf Agreement, dated as of December 19, 2014, among the Company, as issuer, and Metropolitan Life Insurance Company, MetLife Insurance Company USA, Symetra Life Insurance Company, MetLife Insurance K.K., AXIS Reinsurance Company, and Union Fidelity Life Insurance Company, as purchasers
8-K 10.1 3/15/19

4.11
First Amendment to Multicurrency Note Purchase and Private Shelf Agreement, dated March 14, 2019, among the Company, as issuer, and IDEXX Distribution, Inc., IDEXX Operations, Inc., and OPTI Medical Systems, Inc., each as a subsidiary guarantor, and Metropolitan Life Insurance Company, MetLife Reinsurance Company of Bermuda, Ltd., Brighthouse Life Insurance Company, Symetra Life Insurance Company, and AXIS Reinsurance Company
8-K 10.2 3/15/19

4.12
Second Amendment to Multicurrency Note Purchase and Private Shelf Agreement, dated March 23, 2020, among the Company, as issuer, each of the Subsidiary Guarantors (as defined therein), Metropolitan Life Insurance Company and each of the holders of the Notes (as defined therein)
8-K 10.1 3/27/20

Material contracts

10.1
Fourth Amended and Restated Credit Agreement, dated as of December 9, 2021, among the Company, IDEXX Distribution, Inc., IDEXX Operations, Inc., OPTI Medical Systems, Inc., IDEXX Laboratories Canada Corporation, IDEXX B.V., IDEXX Laboratories B.V., and IDEXX Laboratories GmbH, as borrowers, the lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Toronto agent, and the other parties thereto
8-K
10.1 12/9/21

F-53

10.2
Amendment No. 1, dated as of October 20, 2022, to the Fourth Amended and Restated Credit Agreement, among the Company, IDEXX Distribution, Inc., IDEXX Operations, Inc., OPTI Medical Systems, Inc., IDEXX Laboratories Canada Corporation, IDEXX B.V., IDEXX Laboratories B.V., and IDEXX Laboratories GmbH, as borrowers, the lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Toronto agent, and the other parties thereto
8-K
10.1
10/20/22

10.3
Suspension of Rights Agreement dated May 2, 2024, to the Fourth Amended and Restated Credit Agreement, by and among the Borrowers, JPMorgan Chase Bank, N.A., as Administrative Agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Toronto Agent and the Lenders from time to time party thereto
10-Q
10.2
06/30/24

10.4
Amendment No. 2 to the Fourth Amended and Restated Credit Agreement, dated as of November 12, 2025, by and among the Company, IDEXX Distribution, Inc., IDEXX Operations, Inc., OPTI Medical Systems, Inc., IDEXX Laboratories Canada Corporation, IDEXX B.V., IDEXX Laboratories B.V., IDEXX Laboratories GmbH, and IDEXX Holdings II GmbH as borrowers, the lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and JPMorgan Chase Bank, N.A., Toronto Branch, as Toronto agent (which includes the Credit Agreement as Annex I).
8-K
10.1
11/13/25

10.5*
U.S. Supply Agreement, effective as of October 16, 2003, among IDEXX Operations, Inc., the Company and Ortho-Clinical Diagnostics, Inc. (“Ortho”)
10-K 10.1 12/31/21

10.6*
Amendment No. 1 to U.S. Supply Agreement effective as of January 1, 2005, among IDEXX Operations, Inc., the Company and Ortho
10-K 10.2 12/31/21

10.7
Amendment No. 2 to U.S. Supply Agreement effective as of October 15, 2006, among IDEXX Operations, Inc., the Company and Ortho
10-K 10.4 12/31/07

10.8*
Amendment No. 3 to U.S. Supply Agreement effective as of January 18, 2008, among IDEXX Operations, Inc., the Company and Ortho
10-K 10.5 12/31/07

10.9*
Amendment No. 4 to U.S. Supply Agreement effective as of December 28, 2011, among IDEXX Operations, Inc., the Company and Ortho
10-K 10.5 12/31/21

10.10*
Amendment No. 5 to U.S. Supply Agreement effective as of December 9, 2013, among IDEXX Operations, Inc., the Company and Ortho
10-K 10.6 12/31/21

10.11*
Amendment No. 6 to U.S. Supply Agreement effective as of January 1, 2017, among IDEXX Operations, Inc., the Company and Ortho
10-K 10.27 12/31/17

10.12
Amendment No. 7 to U.S. Supply Agreement effective as of July 9, 2019, among IDEXX Operations, Inc., the Company and Ortho
10-Q 10.1 9/30/21

10.13*
Amendment No. 8 to U.S. Supply Agreement effective as of September 1, 2021, among IDEXX Operations, Inc., the Company and Ortho
10-K 10.9 12/31/21

F-54

10.14*
Amendment No. 9 to U.S. Supply Agreement effective as of October 31, 2024, among IDEXX Operations, Inc., the Company and Ortho
10-K
10.10
12/31/24

10.15*
European Supply Agreement, effective as of October 17, 2003, among IDEXX Europe B.V., the Company and Ortho
10-K 10.10 12/31/21

10.16*
Amendment No. 1 to European Supply Agreement effective as of January 1, 2005, among IDEXX Europe B.V., the Company and Ortho
10-K 10.11 12/31/21

10.17*
Amendment No. 2 to European Supply Agreement effective as of January 18, 2008, among IDEXX Europe B.V., the Company and Ortho
10-K 10.8 12/31/07

10.18*
Amendment No. 3 to European Supply Agreement effective as of December 28, 2011, among IDEXX Europe B.V., the Company and Ortho
10-K 10.13 12/31/21

10.19*
Amendment No. 4 to European Supply Agreement effective as of December 9, 2013, among IDEXX Europe B.V., the Company and Ortho
10-K 10.14 12/31/21

10.20
Amendment No. 5 to European Supply Agreement effective as of July 9, 2019, among IDEXX Europe B.V., the Company and Ortho
10-Q 10.2 9/30/21

10.21*
Amendment No. 6 to European Supply Agreement effective as of September 1, 2021, among IDEXX Europe B.V., the Company and Ortho.
10-K 10.16 12/31/21

10.22*
Amendment No. 7 to European Supply Agreement effective as of October 31, 2024, among IDEXX B.V., the Company and Ortho
10-K
10.18 12/31/24

10.23
Amendment, Release and Settlement Agreement dated as of September 12, 2002, among the Company, IDEXX Europe B.V., and Ortho
10-Q 10.1 9/30/02

10.24
Waiver to U.S. Supply Agreement, effective as of October 16, 2003, as amended, among IDEXX Operations, Inc., the Company and Ortho-Clinical Diagnostics, Inc. dated as of April 7, 2020
10-Q 10.1 3/31/20

10.25*
Letter Agreement between Ortho-Clinical Diagnostics, Inc. and IDEXX Operations, Inc. and IDEXX Europe B.V. dated as of July 10, 2020
10-Q 10.1 9/30/20

10.26*
Letter Agreement between Ortho-Clinical Diagnostics, Inc. and IDEXX Operations, Inc. dated November 2, 2021
10-K 10.19 12/31/21

10.27*
Letter agreement between Ortho-Clinical Diagnostics, Inc., IDEXX B.V. and IDEXX Operations, Inc. dated July 28, 2023.
10-Q 10.1 9/30/23

10.28**
IDEXX Laboratories, Inc. 1997 Employee Stock Purchase Plan, as amended
10-K 10.19 12/31/20

10.29**
2009 Stock Incentive Plan, as amended
S-8 99.1 12/30/13

10.30**
2018 Stock Incentive Plan
DEF14A Appendix 3/28/18

F-55

10.31**
Director Deferred Compensation Plan, restated effective as of October 29, 2025
X

10.32**
Restated Executive Deferred Compensation Plan, as amended
10-Q
10.3 06/30/10

10.33**
IDEXX Deferred Compensation Plan, effective December 6, 2024
10-K 10.53 12/31/24

10.34**
Summary of Executive Incentive Plan
X

10. 35 **
Form of Change in Control Agreement, by and between each of the Company’s Executive Officers, other than the Chief Executive Officer
10-K
10.56 12/31/24

10.36**
Second Amended and Restated Employment Agreement, dated October 23, 2019, by and between the Company and Jonathan J. Mazelsky
8-K
10.3 10/24/19

10.37**
Third Amended and Restated Employment Agreement, dated August 2, 2024, by and between the Company and Jonathan J. Mazelsky
10-Q
10.1 09/30/24

10.38**
Letter Agreement by and between Jonathan (Jay) Mazelsky and IDEXX Laboratories, Inc., dated January 12, 2026.
8-K
10.3 01/13/26

10.39**
Form of CEO Stock Option Agreement for grant in 2021
10-Q 10.1 3/31/21

10.40**
Form of CEO Restricted Stock Agreement for grant in 2021
10-Q 10.2 3/31/21

10.41**
Form of Restricted Stock Unit for grants made to Jonathan J. Mazelsky b eginning in 2022
10-K 10.43 12/31/21

10.42**
Form of Stock Option Agreement for grants made to the CEO beginning in 2022
10-K 10.44 12/31/21

10.43**
Letter Agreement by and between Michael (Mike) Erickson, PhD, and IDEXX Laboratories, Inc., dated January 12, 2026.
8-K
10.1 01/13/26

10.44**
Amended and Restated Change in Control Agreement by and between Michael (Mike) Erickson, PhD, and IDEXX Laboratories, Inc., dated January 12, 2026.
8-K
10.2 01/13/26

10.45**
Form of Director Stock Option Agreement
10-K 10.28 12/31/21

10.46**
Form of Director Restricted Stock Unit
10-K 10.29 12/31/21

10.47**
Form of Employee Stock Option Agreement for grants in 2010 to 2015
10-K 10.21 12/31/09

10.48**
Form of Employee Stock Option Agreement for grants in 2016 and 2017
10-K 10.20 12/31/15

10.49**
Form of Employee Stock Option Agreement for grants in 2018 and 2019
10-K 10.25 12/31/18

10.50**
Form of Employee Stock Option Agreement for grants in 2020 and 2021
10-K 10.28 12/31/19

F-56

10.51**
Form of Employee Stock Option Agreement for grants beginning in 2022.
10-K 10.34 12/31/21

10.52**
Form of Employee Restricted Stock Unit Agreement for grants in 2018 and 2019
10-K 10.26 12/31/18

10.53**
Form of Employee Restricted Stock Unit for grants in 2020 and 2021
10-K 10.32 12/31/19

10.54**
Form of Employee Restricted Stock Unit for grants beginning in 2022
10-K 10.41 12/31/21

10.55**
Form of Employee High-Performer Restricted Stock Unit beginning in 2022
10-K 10.42 12/31/21
10.56**
Form of Employee Performance-Based Restricted Stock Unit Agreement for Grants Prior to 2022
10-K 10.27 12/31/18

10.57**
Form of Employee Performance-Based Restricted Stock Unit Agreement (or Leveraged Restricted Stock Unit Agreement)
10-K
10.50 12/31/23

10.58**
Form of Confidential Information, Work Product, and Restrictive Covenant Agreement with each of the Company’s Executive Officers.
10-Q 10.1 3/31/22

Insider Trading Policy

19.1
Insider Trading Policy
10-K
19.1 12/31/24

Subsidiaries of the registrant

21
Subsidiaries of the Company
X

Consent of Independent Registered Public Accounting Firm

23
Consent of PricewaterhouseCoopers LLP, an independent registered public accounting firm.
X

Rule 13a-14(a)/15-14(a) certifications

31.1
Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
X

31.2
Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
X

Section 1350 certifications

F-57

32.1
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
X

32.2
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
X

Policy relating to recovery of erroneously awarded compensation

97.1
IDEXX Laboratories, Inc. Clawback Policy
10-K
97.1 12/31/23

Interactive data file

101 The following financial and related information from IDEXX Laboratories, Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, formatted in Inline eXtensible Business Reportable Language (iXBRL) includes: (i) the Consolidated Balance Sheet; (ii) the Consolidated Statement of Income; (iii) the Consolidated Statements of Comprehensive Income; (iv) the Consolidated Statement of Changes in Stockholders' Equity; (v) the Consolidated Statement of Cash Flows; and, (vi) Notes to Consolidated Financial Statements.

104 The cover page from the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2025, formatted in Inline XBRL and contained in Exhibit 101.

* Certain portions have been omitted as confidential information.

** Management contract or compensatory arrangement required to be filed as an exhibit pursuant to Item 15(a)(3) of Form 10-K.

F-58

SIGNATURES
    Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

IDEXX LABORATORIES, INC.
 
By: /s/ Jonathan J. Mazelsky
Date: February 20, 2026
Jonathan J. Mazelsky
President and Chief Executive Officer

    Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:

SIGNATURE   TITLE DATE

/s/ Jonathan J. Mazelsky President, Chief Executive Officer and Director (Principal Executive Officer)   February 20, 2026
Jonathan J. Mazelsky

/s/ Andrew J. Emerson
Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial and Accounting Officer)   February 20, 2026
Andrew J. Emerson

/s/ Lawrence D. Kingsley Non-Executive Board Chair February 20, 2026
Lawrence D. Kingsley  

/s/ Irene Chang Britt
Director
February 20, 2026
Irene Chang Britt

/s/ Bruce L. Claflin Director   February 20, 2026
Bruce L. Claflin      

/s/ Stuart M. Essig, PhD Director   February 20, 2026
Stuart M. Essig, PhD      

/s/ Joseph L. Hooley
Director February 20, 2026
Joseph L. Hooley

/s/ Daniel M. Junius Director   February 20, 2026
Daniel M. Junius      

/s/ Karen Peacock
Director February 20, 2026
Karen Peacock

/s/ Sam A. Samad Director February 20, 2026
Sam A. Samad      

/s/ M. Anne Szostak Director   February 20, 2026
M. Anne Szostak      

/s/ Sophie V. Vandebroek, PhD Director   February 20, 2026
Sophie V. Vandebroek, PhD      

F-59