10-Q – 2025-10-29 – lfus-20250927.htm

On June 30, 2022, the Company amended and restated its Credit Agreement, dated as of April 3, 2020 (the “Credit Agreement”) to effect certain changes, including, among other changes: (i) adding a $300 million unsecured term loan credit facility; (ii) making certain financial and non-financial covenants less restrictive on the Company and its subsidiaries; (iii) replacing LIBOR-based interest rate benchmarks and modifying performance-based interest rate margins; and (iv) extending the maturity date to June 30, 2027 (the “Maturity Date”). Pursuant to the Credit Agreement, the Company may, from time to time, increase the size of the revolving credit facility or enter into one or more tranches of term loans in minimum increments of $25 million if there is no event of default and the Company is in compliance with certain financial covenants.

Loans made under the available credit facility pursuant to the Credit Agreement ("the Credit Facility") bear interest at the Company’s option, at either Secured Overnight Financing Rate ("SOFR"), fixed for interest periods of one, two, three or six-month periods, plus 1.00% to 1.75%, plus a SOFR adjustment of 0.10% or at the bank’s Base Rate, as defined in the Credit Agreement, plus 0.00% to 0.75%, based upon the Company’s Consolidated Leverage Ratio, as defined in the Credit Agreement. The Company is also required to pay commitment fees on unused portions of the Credit Facility ranging from 0.10% to 0.175%, based on the Consolidated Leverage Ratio, as defined in the Credit Agreement. The Credit Agreement includes representations, covenants and events of default that are customary for financing transactions of this nature.

Under the Credit Agreement, revolving loans may be borrowed, repaid and reborrowed until the Maturity Date, at which time all amounts borrowed must be repaid. The Company borrowed $300.0 million under a term loan on June 30, 2022. The principal balance of the term loans must be repaid in quarterly installments on the last day of each calendar quarter in the amount of $1.9 million commencing September 30, 2022, through June 30, 2024, and in the amount of $3.8 million commencing September 30, 2024, through March 31, 2027, with the remaining outstanding principal balance payable in full on the Maturity Date. Accrued interest on the loans is payable in arrears on each interest payment date applicable thereto and at such other times as may be specified in the Credit Agreement. Subject to certain conditions, (i) the Company may terminate or reduce the Aggregate Revolving Commitments, as defined in the Credit Agreement, in whole or in part, and (ii) the Company may prepay the revolving loans or the term loans at any time, without premium or penalty. During the three and nine months ended September 27, 2025, the Company made term loan payments of $3.8 million and $11.3 million, respectively. The revolving loan and term loan balances under the Credit Facility were $100.0 million and $270.0 million, respectively, as of September 27, 2025.

On May 12, 2022, the Company entered into an interest rate swap agreement to manage interest rate risk exposure, effectively converting the interest rate on the Company's SOFR based floating-rate loans to a fixed-rate. The interest rate swap, with a notional value of $200 million, was designated as a cash flow hedge against the variability of cash flows associated with the Company's SOFR based loans scheduled to mature on June 30, 2027.

As of September 27, 2025, the effective interest rate on the unhedged portion of the outstanding borrowings under the credit facility was 5.26%, and 4.13% on the hedged portion.

As of September 27, 2025, the Company had $0.1 million outstanding letters of credit and had $599.9 million of borrowing capacity available under the revolving credit facility. As of September 27, 2025, the Company was in compliance with all covenants under the Credit Agreement.
 
42

Table of Contents

Senior Notes
 
On December 8, 2016, the Company entered into a Note Purchase Agreement, pursuant to which the Company issued and sold €212 million aggregate principal amount of senior notes in two series. The funding date for the Euro denominated senior notes occurred on December 8, 2016 for €117 million in aggregate amount of 1.14% Senior Notes, Series A, due December 8, 2023 (“Euro Senior Notes, Series A due 2023”), and €95 million in aggregate amount of 1.83% Senior Notes, Series B due December 8, 2028 (“Euro Senior Notes, Series B due 2028”) (together, the “Euro Senior Notes”). During the fiscal year ended December 30, 2023, the Company paid off €117 million of Euro Senior Notes, Series A due on December 8, 2023. Interest on the Euro Senior Notes due 2028 is payable semiannually on June 8 and December 8, commencing June 8, 2017.
 
On December 8, 2016, the Company entered into a Note Purchase Agreement, pursuant to which the Company issued and sold $125 million aggregate principal amount of senior notes in two series. On February 15, 2017, $25 million in aggregate principal amount of 3.03% Senior Notes, Series A, due February 15, 2022 (“U.S. Senior Notes, Series A due 2022”), and $100 million in aggregate principal amount of 3.74% Senior Notes, Series B, due February 15, 2027 (“U.S. Senior Notes, Series B due 2027”) were funded. During the fiscal year ended December 31, 2022, the Company paid off $25 million of U.S. Senior Notes, Series A due on February 15, 2022. Interest on the U.S. Senior Notes due 2027 is payable semiannually on February 15 and August 15, commencing August 15, 2017.
 
On November 15, 2017, the Company entered into a Note Purchase Agreement pursuant to which the Company issued and sold $175 million in aggregate principal amount of senior notes in two series. On January 16, 2018, $50 million aggregate principal amount of 3.48% Senior Notes, Series A, due February 15, 2025 (“U.S. Senior Notes, Series A due 2025”) and $125 million in aggregate principal amount of 3.78% Senior Notes, Series B, due February 15, 2030 (“U.S. Senior Notes, Series B due 2030”) (together, the “U.S. Senior Notes due 2025 and 2030”) were funded. During the first fiscal quarter of 2025, the Company paid off $50 million of U.S. Senior Notes, Series A, due February 15, 2025. Interest on the U.S. Senior Notes, series B due 2030 is payable semiannually on February 15 and August 15, commencing on August 15, 2018.
 
On May 18, 2022, the above note purchase agreements were amended to, among other things, update certain terms, including financial covenants to be consistent with the terms of the restated Credit Agreement and the 2022 Purchase Agreement, as defined below.

On May 18, 2022, the Company entered into a Note Purchase Agreement (“2022 Purchase Agreement”) pursuant to which the Company issued and funded on July 18, 2022 $100 million in aggregate principal amount of 4.33% Senior Notes, due June 30, 2032 (“U.S. Senior Notes due 2032”) (together with the U.S. Senior Notes due 2025 and 2030, the Euro Senior Notes and the U.S. Senior Notes due 2022 and 2027, the “Senior Notes”). Interest on the U.S. Senior Notes due 2032 is payable semiannually on June 30 and December 30, commencing on December 30, 2022.

The Senior Notes have not been registered under the Securities Act of 1933 ("Securities Act"), or applicable state securities laws. The Senior Notes are general unsecured senior obligations and rank equal in right of payment with all existing and future unsecured unsubordinated indebtedness of the Company.
 
The Senior Notes are subject to certain customary covenants, including limitations on the Company’s ability, with certain exceptions, to engage in mergers, consolidations, asset sales and transactions with affiliates, to engage in any business that would substantially change the general business of the Company, and to incur liens. In addition, the Company is required to satisfy certain financial covenants and tests relating to, among other matters, interest coverage and leverage.
 
The Company may redeem the Senior Notes upon the satisfaction of certain conditions and the payment of a make-whole amount to note holders and are required to offer to repurchase the Senior Notes at par following certain events, including a change of control.

Debt Covenants

The Company was in compliance with all covenants under the Credit Agreement and Senior Notes as of September 27, 2025 and currently expects to remain in compliance based on management’s estimates of operating and financial results for 2025. As of September 27, 2025, the Company met all the conditions required to borrow under the Credit Agreement and management expects the Company to continue to meet the applicable borrowing conditions.

43

Table of Contents

Acquisitions

On December 31, 2024, the Company completed the acquisition of Dortmund Fab from Elmos Semiconductor SE. The total purchase price for the Dortmund Fab was approximately €94 million, of which a €37.2 million down payment (approximately $40.5 million) was paid in the third quarter of 2023 after regulatory approvals, and €56.7 million (approximately $58.8 million) was paid at closing. The business is reported in the Electronics-Semiconductor business within the Company’s Electronics segment.

Dividends

During the third quarter of 2025, the Company paid quarterly dividends of $18.6 million to its shareholders. On October 29, 2025, the Company announced the declaration of a quarterly cash dividend of $0.75 per share payable on December 4, 2025 to stockholders of record as of November 20, 2025.

Cash Flow Overview

  First Nine Months
(in thousands) 2025 2024
Net cash provided by operating activities $ 295,099  $ 206,999 
Net cash used in investing activities (99,701) (41,134)
Net cash used in financing activities (126,274) (91,299)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash 20,868  (396)
Increase in cash, cash equivalents, and restricted cash 89,992  74,170 
Cash, cash equivalents, and restricted cash at beginning of period 726,437  557,123 
Cash, cash equivalents, and restricted cash at end of period $ 816,429  $ 631,293 

 
Cash Flow from Operating Activities
 
Operating cash inflows are largely attributable to sales of the Company’s products. Operating cash outflows are largely attributable to recurring expenditures for raw materials, labor, rent, interest, taxes, and other operating activities.
 
Net cash provided by operating activities was $295.1 million for the nine months ended September 27, 2025 compared to $207.0 million for the nine months ended September 28, 2024. The increase in net cash provided by operating activities of $88.1 million was primarily due to higher cash earnings and reductions in working capital.

Cash Flow from Investing Activities
 
Net cash used in investing activities was $99.7 million for the nine months ended September 27, 2025 compared to $41.1 million during the nine months ended September 28, 2024. Net cash paid for the Dortmund Fab acquisition was $57.4 million during the nine months ended September 27, 2025. Capital expenditures were $48.7 million, representing a decrease of $1.4 million, compared to the nine months ended September 28, 2024. During the nine months ended September 27, 2025, the Company received proceeds of $5.6 million from the sale of the Marine business within the Transportation segment. During the nine months ended September 28, 2024, the Company received proceeds of $9.7 million from the sale of a land use right within the Electronics segment and two buildings within the Transportation segment.
 
Cash Flow from Financing Activities
 
Net cash used in financing activities was $126.3 million for the nine months ended September 27, 2025 compared to $91.3 million for the nine months ended September 28, 2024. During the nine months ended September 27, 2025, the Company paid off $50 million of U.S. Senior Notes, Series A, due February 15, 2025 and made payments of $11.3 million on the term loan. During the nine months ended September 28, 2024, the Company made payments of $3.8 million on the term loan. The Company paid dividends of $53.3 million and $49.7 million in the nine months ended September 27, 2025 and September 28, 2024, respectively. In addition, during the nine months ended September 27, 2025 and September 28, 2024, the Company repurchased 120,689 shares of its common stock totaling $27.4 million and 179,311 shares of its common stock totaling $40.9 million, respectively. The Company paid a $0.2 million excise tax related to the share repurchases during the nine months ended September 27, 2025. In addition, the Company received $17.9 million cash from stock option exercise activities during the nine months ended September 27, 2025 compared to $5.0 million for the nine months ended September 28, 2024.
44

Table of Contents

Share Repurchase Program
 
On April 25, 2024, the Company's Board of Directors authorized a three-year program to repurchase up to $300.0 million in the aggregate of shares of the Company's stock for the period from May 1, 2024 to April 30, 2027 ("2024 program") to replace its previous 2021 program. The Company did not repurchase shares of its common stock for the three months ended September 27, 2025. During the nine months ended September 27, 2025, the Company repurchased 120,689 shares of its common stock totaling $27.4 million pursuant to the 2024 program. During the nine months ended September 28, 2024, the Company repurchased 179,311 shares of its common stock totaling $40.9 million, of which $38.9 million was pursuant to the 2021 program and $2.0 million was pursuant to the 2024 program.

Off-Balance Sheet Arrangements
 
As of September 27, 2025, the Company did not have any off-balance sheet arrangements, as defined under SEC rules. Specifically, the Company was not liable for guarantees of indebtedness owed by third parties, the Company was not directly liable for the debt of any unconsolidated entity and the Company did not have any retained or contingent interest in assets. The Company does not participate in transactions that generate relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities.

Critical Accounting Policies and Estimates
 
The Company’s Condensed Consolidated Financial Statements are prepared in accordance with U.S. GAAP. In connection with the preparation of the Condensed Consolidated Financial Statements, the Company uses estimates and makes judgments and assumptions about future events that affect the reported amounts of assets, liabilities, revenue, expenses, and the related disclosures. The assumptions, estimates, and judgments are based on historical experience, current trends, and other factors the Company believes are relevant at the time it prepares the Condensed Consolidated Financial Statements.
 
The significant accounting policies and critical accounting estimates are consistent with those discussed in Note 1, Summary of Significant Accounting Policies and Other Information , to the consolidated financial statements and the MD&A section of the Company’s Annual Report on Form 10-K for the year ended December 28, 2024. During the nine months ended September 27, 2025, there were no significant changes in the application of critical accounting policies and estimates.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 
See Item 7A,  Quantitative and Qualitative Disclosures about Market Risk , of the Company's Annual Report on Form 10-K for the year ended December 28, 2024. During the nine months ended September 27, 2025, there were no material changes in the Company's exposure to market risk.

ITEM 4. CONTROLS AND PROCEDURES  
 
Evaluation of Disclosure Controls and Procedures
 
Disclosure controls and procedures (as defined in Rules 13a-15(b) and 15d-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to management, including the Company's Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures.
 
In connection with the preparation of this report, management, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of the design and operation of the Company's disclosure controls and procedures as of September 27, 2025. Based on that evaluation, the Company's Chief Executive Officer and Chief Financial Officer have concluded that, as of the quarter ended September 27, 2025, the Company's disclosure controls and procedures were not effective, because of the previously reported material weaknesses in internal control over financial reporting, as described below.

Previously Reported Material Weaknesses in Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Exchange Act Rule 13a-15(f) and 15d-15(f) based on the criteria established in Internal Control-Integrated Framework (2013)
45

Table of Contents

issued by the Committee of Sponsoring Organizations of the Treadway Commission (“the COSO Framework). As reported in our Form 10-K for the fiscal year ended December 28, 2024, we did not maintain effective internal control over financial reporting as of December 28, 2024 as a result of material weaknesses in the control environment and control activities areas. A material weakness (as defined in Rule 12b-2 under the Exchange Act) is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. Refer to our 2024 Form 10-K for a description of our material weaknesses.

Ongoing Remediation Efforts to Address Material Weaknesses

Our material weaknesses were not remediated as of September 27, 2025. Our management team is committed to maintaining a strong internal control environment. The Company, with oversight from our Audit Committee of the Board of Directors, is taking comprehensive actions to remediate the material weaknesses. The Company has developed and is in the process of implementing its remediation plan, which includes the following steps:

Control Environment
• recruiting of personnel with appropriate internal controls, and accounting knowledge and experience commensurate with our accounting and reporting requirements;
• enhanced supervision of personnel at certain locations to ensure compliance with established Company policies; and
• evaluating and updating (as appropriate) the sufficiency of policies and training provided to personnel to ensure the appropriate segregation of duties and adherence to the Code of Conduct.

Control Activities
• augmentation of training and clear instruction as to the process for recording of adjustments to inventories;
• full physical inventory observations, facilitated by independent counters, until the cycle count and related inventory existence controls at certain of our non-U.S. manufacturing locations are operating effectively;
• implementation of a management review control over inventory movements; and
• examination and enhancement of the procedures to evaluate the completeness and accuracy of data and assumptions utilized in computing inventory reserves.

The Company has made progress with a number of initiatives and actions to address the previously reported material weaknesses, which include the following:

Control Environment
• The Company has replaced certain key finance and operational roles at certain non-U.S. manufacturing locations, and continues to actively recruit the remaining open roles;
• The Company is substantially complete with the redesign of the regional operations and finance organizational structures; and
• New corporate policies and procedures have been adopted and disseminated along with training provided to strengthen the control environment and inventory management oversight.

Control Activities
• Key monitoring controls have been designed and implemented for cycle counts, full physical count, inventory storage locations, and excessive and obsolete inventory calculations; and
• Full physical inventory observations, facilitated by independent counters, have been performed in certain non-U.S. locations in the second and third quarter of 2025 and will continue for the remainder of fiscal year 2025.

We intend to remediate the material weaknesses as soon as possible; however, the material weaknesses will not be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that the appropriate controls are operating effectively.
 
Changes in Internal Control over Financial Reporting
 
Other than the ongoing remediation efforts described above, there were no changes in the Company's internal control over financial reporting identified in connection with the evaluation required by Rules 13a-15(f) and 15d-15(f) under the Exchange Act that occurred during the quarter ended September 27, 2025 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.
 
46

Table of Contents

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS 
 
None.
 

ITEM 1A. RISK FACTORS 

Changes in U.S. and other countries trade policy, including the imposition of tariffs and the resulting consequences and uncertainties, may have a material adverse impact on our business and results of operations.

Our international presence subjects us to risks associated with international trade conflicts between the United States and its trade partners, particularly with regard to the risk of heightened tariffs and import/export controls. Recently, the U.S. government has imposed extensive tariffs on several countries, including, without limitation, China, Mexico and Canada, as well as certain broad, product-specific tariffs on foreign goods and products. Tariffs may increase the cost of materials in our supply chain, incur reciprocal levies on components and finished products exported to or imported from affected countries, and have an adverse impact on our cost of goods sold in the U.S. and abroad. These factors in turn could require us to materially increase prices to our customers which may reduce demand, or, if we do not or are unable to increase prices, could result in lower margins on products sold. Additionally, the adoption or threat of adoption of extensive tariffs could result in an economic slowdown, a significant reduction in consumer confidence, and an increased risk of inflationary pressure, all of which, either separately or together, could adversely affect our business.

Tariffs have resulted in China and other countries imposing reciprocal tariffs on U.S. goods and ceasing sales of certain products to the U.S. and could result in more U.S. trading partners adopting responsive trade policies, including making it more difficult or costly for us to export our products to those countries. Sales to customers outside of the U.S., and to China in particular, comprise a significant portion of our net sales, and reciprocal tariffs may impact our business in China. Continued geopolitical issues and barriers to trade may result in customers outside the U.S. seeking to source products from local suppliers, which could further result in lower sales or lost customers. Further, tariffs and trade policies may continue to change quickly and without warning, and we may not be able to accurately anticipate and mitigate the impacts.

Other than the item listed above, there have been no material changes in our risk factors from those disclosed in our Annual Report on Form 10-K for our year ended December 28, 2024.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 
 
Recent Sales of Unregistered Securities
 
None.
 
Repurchases of Common Stock

On April 25, 2024, the Company's Board of Directors authorized a three-year program to repurchase up to $300.0 million in the aggregate of shares of the Company's stock for the period from May 1, 2024 to April 30, 2027 ("2024 program") to replace its previous 2021 program. The Company did not repurchase shares of its common stock for the three months ended September 27, 2025. During the nine months ended September 27, 2025, the Company repurchased 120,689 shares of its common stock totaling $27.4 million pursuant to the 2024 program. During the nine months ended September 28, 2024, the Company repurchased 179,311 shares of its common stock totaling $40.9 million, of which $38.9 million was pursuant to the 2021 program and $2.0 million was pursuant to the 2024 program.
 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES 
 
None.

ITEM 4. MINE SAFETY DISCLOSURES 
 
None.
 

ITEM 5. OTHER INFORMATION 
  
47

Table of Contents

None .

 

ITEM 6. EXHIBITS

Exhibit Description

2.1 Membership Interest Purchase Agreement, dated October 24, 2025, by and between Littelfuse, Inc. and Basler Holdings, LLC. (filed as exhibit 2.1 to the Company’s Form 8-K filed October 28, 2025. File No. 000-20388 and incorporated herein by reference).

10.1* Letter Agreement between Littelfuse, Inc. and Chad Marak, dated August 26, 2025.

10.2 Form of Non-Compete, Non-Solicitation, Indemnification, Resignation and Release Agreement (filed as exhibit 10.1 to the Company’s Form 8-K filed October 28, 2025. File No. 000-20388 and incorporated herein by reference).

31.1* Certification of Gregory N. Henderson, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

   
31.2* Certification of Abhishek Khandelwal, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

   
32.1** Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

   
101 The following financial information from LITTELFUSE, Inc.'s Quarterly Report on Form 10-Q for the quarter ended September 27, 2025 formatted in Inline XBRL (Extensible Business Reporting Language) includes: (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Net Income, (iii) the Condensed Consolidated Statements of Comprehensive Income, (iv) the Condensed Consolidated Statements of Stockholders' Equity, (v) the Condensed Consolidated Statements of Cash Flows, and (vi) Notes to the Condensed Consolidated Financial Statements.

104 The cover page from this Quarterly Report on Form 10-Q for the quarter ended September 27, 2025, formatted in Inline XBRL.

* Filed herewith.
** Furnished herewith.

48

Table of Contents

SIGNATURES
 
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Quarterly Report on Form 10-Q for the quarter ended September 27, 2025, to be signed on its behalf by the undersigned thereunto duly authorized.
 

  Littelfuse, Inc.  
       
By: /s/ Abhishek Khandelwal  
    Abhishek Khandelwal  
  Executive Vice President and Chief Financial Officer
     
Date: October 29, 2025
By: /s/ Jeffrey G. Gorski  
    Jeffrey G. Gorski  
  Senior Vice President and Chief Accounting Officer

49