Earnings release
Page 1
Ferguson Reports Second Quarter Ended June 30 , 2026 Continued Execution Drives Solid Results ; Full Year Guidance Increased Exhibit 99.1 Second quarter highlights Sales of $ 8.8 billion , increased 4. % . Gross margin of 31.0 % , down 20 bps from prior year . Operating margin of 10.2 % , up 10 bps on prior year ( Diluted earnings per share of $ 3.43 , up ' 9 % on prior year ( 10.7 % on an adjusted basis , down 10 bps ) . $ 3.39 on an adjusted basis , up 5.3 % ) . Completed five acquisitions during the quarter and signed a definitive purchase agreement to acquire FWI Holdings , Inc. ( " FloWorks " ) . Declared quarterly dividend of $ 0.89 . - Share repurchases of $ 202 million during the quarter . Balance sheet remains strong with net debt to adjusted EBITDA of 1.3 2 August 10 , 202 , Newport News , VA- Ferguson Enterprises Inc. ( commented , " Our associates continued to e NYSE FERG ) . Kevin Murphy , Ferguson CEO , ecute for our customers , driving market outperformance in the second quarter . We delivered another strong quarter of non - residential growth and we returned to growth in residential despite the challenging market backdrop . We completed five acquisitions and signed a definitive purchase agreement to acquire FloWorks , a leading distributor of highly technical valves and flow control solutions . Our scale - advantaged business model and consistent cash generation enable us to invest in organic growth , consolidate our markets through acquisitions and return capital to shareholders , all while maintaining a strong balance sheet . ני " While the economic environment remains uncertain , our performance year - to - date enables the upward revision of our full year guidance . We e pect to continue delivering market outperformance by deploying scale locally and leveraging the long - term growth drivers of water infrastructure , large capital projects , climate and comfort and aging and underbuilt housing . We remain confident in our ability to capitalize on these growth drivers as we provide essential water and air solutions for the comple project needs of the specialized professional . " Calendar 2026 Guidance Updated guidance does not include the e pected impact of the FloWorks acquisition , e pected to close during the third quarter . Net sales Prior 2026 Guidance January 1 December 31 , 202 Low to mid - single digit growth 9.4 % -9.8 % Adjusted operating margin * Interest e pense Capital e penditures Adjusted effective ta rate * ~ $ 200 million $ 350 $ 400 million ~ 2 % Updated 2026 Guidance January 1 - December 31 , 202 Mid - single digit growth 9.5 % -9.8 % ~ $ 200 million $ 375 $ 425 million ~ 2 % * The Company does not reconcile forward - looking non - GAAP measures . See " Non - GAAP Reconciliations and Supplementary information " .
Page 2
Three months ended June 30, US$ (In millions, exceptper share amounts) 2026 2025 Change Reported Adjusted Reported Adjusted Reported Adjusted Net sales 8,751 8,751 8,36 3 8,36 3 +4.6 % +4. % Gross margin 31.0% 31.0% 31.2% 31.2% ( 20)bps ( 20)bps Operating profit 893 932 842 906 +6 .1% +2.9% Operating margin 10.2% 10.7% 10.1% 10.8% +10 bps( 10)bps Earnings per share -diluted 3.43 3.39 3.21 3.22 +6 .9% +5.3% Adjusted EBITDA 994 96 3 +3.2% Net debt : Adjusted EBITDA 1.3x1.2x Six months ended June 30, US$ (In millions, except per shareamounts) 2026 2025 Change Reported Adjusted Reported Adjusted Reported Adjusted Net sales 16 ,223 16 ,223 15,576 15,576 +4.2% +4.2% Gross margin 31.0% 31.0% 31.0% 31.0% Flat Flat Operating profit 1,505 1,579 1,349 1,503 +11.6 % +5.1% Operating margin 9.3% 9.7% 8.7% 9.6 % +6 0 bps +10 bps Earnings per share - diluted 5.56 5.6 7 4.94 5.30 +12.6 % +7.0% Adjusted EBITDA 1,705 1,6 14 +5. % Net debt : Adjusted EBITDA 1.3x1.2x The Company uses certain non-GAAP measures, which are not defined or specified under U.S. GAAP. See the section titled “Non-GAAP Reconciliations and Supplementary Information.” Summary of financial results Quarter ended June 30, 2026 Net sales of $8.8 billion were 4.6 % ahead of last year driven by organic revenue growth of 3.8% and acquisition growth of 1.0%, partially offset by 0.2% from a divestment in Canada. Price inflation was in the low single digits. Gross margin of 31.0% was 20 basis points below the prior year, which was temporarily elevated by the timing and extent of supplier price increases. We continued to drive operating leverage by balancing disciplined cost management with investments for future growth. Reported operating profit was $893 million ( 10.2% operating margin), 6 .1% ahead of last year. Adjusted operating profit of $932 million ( 10.7% adjusted operating margin) was 2.9% above last year. Reported diluted earnings per share was $3.43, an increase of 6 .9% compared to last year, while adjusted diluted earnings per share of $3.39 increased 5.3% due to the higher adjusted operating profit and the impact of share repurchases. US - quarter ended June 30, 2026 Net sales in the US business increased by 5.0%, with organic revenue growth of 4.0% and a further 1.0% contribution from acquisitions. ( 1) ( 1) ( 1) ( 1) ( 1) ( 1) ( 1) 2
Page 3
Residential end markets, representing approximately half of revenue, remained subdued. New residential construction activity has been weak and repair, maintenance and improvement ( “RMI”) work remains soft. We continue to outperform our markets with residential revenue up 2% in the quarter. Our non-residential revenue increased 8% this quarter as our scale, expertise, multi-customer group approach and value-added solutions drove strong share gains in a mixed market. Large capital project activity remained healthy with growth in open order volumes and strong bidding activity. Adjusted operating profit of $925 million was 2.9% or $26 million above last year. We completed five acquisitions during the quarter, further strengthening our geographic footprint and specialized capabilities across our customer groups: HVAC: Expanded our offering by adding Carrier Great Lakes, with seven locations across Michigan and Ohio, and Dealers Supply Company, with seventeen locations in the Southeast. Commercial/Mechanical: Broadened our value-added capabilities with New England Applied Products, a manufacturer’s representative and engineering firm specializing in high-performance commercial HVAC systems in the Northeast. Waterworks: Continued to diversify our portfolio by adding process solutions for water and wastewater treatment in Michigan through the acquisition of Hamlett Environmental Technologies Company. Industrial: Strengthened our specialty valve, flow control, and process equipment offerings with ten locations across the country with PRD Technologies Group. Subsequent to quarter-end, we entered into a definitive agreement to acquire FWI Holdings, Inc. ( “FloWorks”), a leading industrial distributor and service provider of highly technical valves and flow control solutions. We expect to complete this acquisition during the third quarter. The aggregate annualized revenue of the eight acquisitions announced year-to-date is approximately $1.4 billion. For more information on the FloWorks acquisition, see the press release dated July 13, 2026 on Ferguson’s corporate pressroom at https://www.fergusonpressroom.com. Canada - quarter ended June 30, 2026 Net sales decreased by 1.9% with organic growth of 1.7% fully offset by 3.6 % from a non-core business divestment. Markets have remained challenging in Canada, particularly in residential. Adjusted operating profit of $22 million was $1 million below last year. 3
Page 4
Segment overview Three months ended June 30, Six months ended June 30, US$ (In millions) 2026 2025 Change 2026 2025 Change Net sales: US 8,343 7,947 +5.0 % 15,489 14,851 +4.3 % Canada 408 416 ( 1.9)% 734 725 +1.2 % Total net sales 8,751 8,36 3 +4.6 % 16 ,223 15,576 +4.2 % Adjusted operatingprofit: US 925 899 +2.9 % 1,581 1,510 +4.7 % Canada 22 23 ( 4.3)% 27 29 ( .9)% Central and othercosts ( 15) ( 16 ) ( 29) ( 36 ) Total adjusted operatingprofit 932 906 +2.9 % 1,579 1,503 +5.1 % Financial position Net debt to adjusted EBITDA at June 30, 2026 was 1.3x and during the quarter we invested $573 million in acquisitions and returned $202 million of surplus capital via share repurchases. We declared a quarterly dividend of $0.89. The dividend will be paid on October 7, 2026 to stockholders of record as of August 21, 2026 . Cancellation of secondary listing on the London Stock Exchange On June 16 , 2026 , Ferguson announced its intention to cancel its secondary listing on the London Stock Exchange. This cancellation took effect on July 20, 2026 . 4
Page 5
For further information please contact Investor relations Pete Kennedy, Vice President of IR and Sustainability Mobile:+1 757 6 03 0111 Christen Rusbarsky, Director of Investor Relations Mobile: +1 443 528 2533 Media inquiries Christine Dwyer, Vice President of Communications and PR Mobile: +1 757 46 9 5813 Investor conference call and webcast A call with Kevin Murphy, CEO and Bill Brundage, CFO will commence at 8:30 a.m. ET today. The call will be recorded and available on our website after the event at corporate.ferguson.com. Dial in number US: +1 6 46 6 6 4 196 0 Ask for the Ferguson call quoting 847413. To access the call via your laptop, tablet or mobile device please go to corporate.ferguson.com. If you have technical difficulties, please click the “Listen by Phone” button on the webcast player and dial the number provided. About Ferguson Ferguson ( NYSE: FERG) is North America’s largest value-added distributor of essential water and air solutions, serving specialized professionals in our $340B residential and non-residential construction markets. We help make our customers’ complex projects simple, successful and sustainable by providingexpertise and a wide range of products and services from plumbing, HVAC, appliances, and lighting to PVF, water and wastewater solutions, and more. Headquartered in Newport News, Va., Ferguson has sales of $31.3 billion ( CY’25) and approximately 35,000 associates in over 1,700 locations. For more information,please visit corporate.ferguson.com. Provisional financial calendar Results for period ending September 30, 2026 November 09, 2026 with call from 8:30 a.m. ET 5
Page 6
Cautionary note on forward-looking statements Certain information included in this announcement is forward-looking, including within the meaning of the Private Securities Litigation Reform Act of 1995, and involves risks, assumptions and uncertainties that could cause actual results to differ materially from those expressed or implied by forward-looking statements. Forward-looking statements cover all matters which are not historical facts and include, without limitation, statements or guidance regarding or relating to our future financial position, results of operations and growth, plans and objectives for the future including our capabilities and priorities, expectations regarding global and regional economic, market and political conditions, ability to manage supply chain challenges, ability to manage the impact of product price fluctuations, the overall performance of, including demand levels for, the markets in which we operate, pending acquisitions, including the anticipated timing, financing, synergies and financial impact of such transactions, capital deployment strategy, including the amount and timing of our dividends and share repurchases, investments and capital expenditures and other statements concerning the success of our business and strategies. Forward-looking statements can be identified by the use of forward-looking terminology, including terms such as “believes,” “estimates,” “anticipates,” “expects,” “forecasts,” “guidance,” “intends,” “continues,” “plans,” “projects,” “poised,” “goal,” “target,” “aim,” “may,” “will,” “would,” “could” or “should” or, in each case, their negative or other variations or comparable terminology and other similar references to future periods. Forward-looking statements speak only as of the date on which they are made. They are not assurances of future performance and are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Therefore, you should not place undue reliance on any of these forward-looking statements. Although we believe that the forward-looking statements contained in this announcement are based on reasonable assumptions, you should be aware that many factors could cause actual results to differ materially from those contained in such forward-looking statements, including but not limited to: weakness in the economy, market trends, uncertainty and other conditions in the markets in which we operate and the macroeconomic impact of factors beyond our control ( including, among others, inflation/deflation, recession, labor and wage pressures, trade restrictions such as tariffs, sanctions and retaliatory countermeasures, interest rates, and geopolitical conditions); failure to rapidly identify or effectively respond to direct and/or end customers’ wants, expectations or trends, including costs and potential problems associated with new or upgraded information technology systems or our ability to timely deploy new omni-channel capabilities; decreased demand for our products as a result of operating in highly competitive industries and the impact of declines in the residential and non- residential markets and our ability to effectively manage inventory as a result; changes in competition, including as a result of market consolidation, new entrants, vertical integration or competitors responding more quickly to emerging technologies ( such as generative or agentic artificial intelligence ( “AI”)); failure of a key information technology system or process as well as payment-related risks, including exposure to fraud or theft; privacy and protection of sensitive data failures, including failures due to data corruption, cybersecurity incidents, network security breaches or the use of AI; ineffectiveness of or disruption in our domestic or international supply chain or our fulfillment network, including delays in inventory availability at our distribution facilities and branches, increased delivery costs or lack of availability due to loss of key suppliers; failure to effectively manage and protect our facilities and inventory or to prevent personal injury to customers, suppliers or associates, including as a result of workplace violence; unsuccessful execution of our operational strategies, including the failure to quickly adapt our strategy to emerging technologies; failure to attract, retain and motivate key associates; exposure of associates, contractors, customers, suppliers and other individuals to health and safety risks and fleet incidents; risks associated with acquisitions, partnerships, joint ventures and other business combinations, dispositions or strategic transactions; risks associated with sales of private label products, including regulatory, product liability and reputational risks and the adverse impact such sales may have on supplier relationships and rebates; the failure to achieve and maintain a high level of product and service quality or comply with responsible sourcing standards; inability to renew leases on favorable terms or at all, as well as any remaining obligations under a lease when we close a facility; changes in, interpretations of, or compliance with tax laws and accounting standards; our access to capital, indebtedness and 6
Page 8
changes in our credit ratings and outlook; fluctuations in product prices/costs ( e.g., including as a result of the use of commodity-priced materials, inflation/deflation, trade restrictions and/or failure to qualify for or maintain supplier rebates) and foreign currency; funding risks related to our defined benefit pension plans; legal proceedings in the ordinary course of our business as well as any failure to comply with domestic and foreign laws, regulations and standards, as those laws, regulations and standards or interpretations and enforcement thereof may change; the occurrence of unforeseen developments such as litigation, investigations, governmental proceedings or enforcement actions; our failure to comply with the obligations associated with being a public company listed on the New York Stock Exchange and the costs associated therewith; the costs and risk exposure relating to sustainability matters and disclosures, including regulatory or legal requirements and disparate stakeholder expectations; and other risks and uncertainties set forth under the heading “Risk Factors” in our Transition Report on Form 10-KT for the five- month transition period ended December 31, 2025 filed with the Securities and Exchange Commission ( “SEC”) on February 27, 2026 and in other filings we make with the SEC in the future. Additionally, forward- looking statements regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Other than in accordance with our legal or regulatory obligations, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. 7
Page 9
Ferguson Enterprises Inc. Non-GAAP Reconciliations and Supplementary Information (unaudited) Non-GAAP items This announcement contains certain financial information that is not presented in conformity with U.S. GAAP. These non- GAAP financial measures include adjusted operating profit, adjusted operating margin, adjusted net income, adjusted earnings per share - diluted, adjusted EBITDA, adjusted effective tax rate, net debt and net debt to adjusted EBITDA ratio. The Company believes that these non-GAAP financial measures provide users of the Company’s financial information with additional meaningful information to assist in understanding financial results and assessing the Company’s performance from period to period. Management believes these measures are important indicators of operations because they exclude items that may not be indicative of our core operating results and provide a better baseline for analyzing trends in our underlying businesses, and they are consistent with how business performance is planned, reported and assessed internally by management and the board of directors. Such non-GAAP adjustments include amortization of acquired intangible assets, discrete tax items, and any other items that are non-recurring. Non-recurring items may include various restructuring charges, gains or losses on the disposals of businesses which by their nature do not reflect primary operations, as well as certain other items deemed non-recurring in nature and/or that are not a result of the Company’s primary operations. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. These non-GAAP financial measures should not be considered in isolation or as a substitute for results reported under U.S. GAAP. These non-GAAP financial measures reflect an additional way of viewing aspects of operations that, when viewed with U.S. GAAP results, provide a more complete understanding of the business. The Company strongly encourages investors and shareholders to review the Company’s financial statements and publicly filed reports in their entirety and not to rely on any single financial measure. The Company does not provide a reconciliation of forward-looking non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures on a forward-looking basis because it is unable to predict with reasonable certainty or without unreasonable effort non-recurring items, such as those described above, that may arise in the future. The variability of these items is unpredictable and may have a significant impact. 8
Page 10
Reconciliation of Net Income to Adjusted Operating Profit and Adjusted EBITDA Three months ended Six months ended June 30, June 30, (In millions) 2026 2025 2026 2025 Net income $6 6 6 $6 34 $1,080 $979 Provision for income taxes 180 156 326 280 Interest expense, net 52 49 97 95 Other ( income) expense, net ( 5) 3 2 ( 5) Operating profit 893 842 1,505 1,349 Corporate restructuring expenses 2 4 4 4 Business restructuring expenses — 21 — 72 Amortization of acquired intangibles 37 39 70 78 Adjusted Operating Profit 932 906 1,579 1,503 Depreciation & impairment of PP&E 56 49 114 9 Amortization of non-acquired intangibles 6 8 12 15 Adjusted EBITDA $994 $96 3 $1,705 $1, 14 ( 1) For the three and six months ended June 30, 2026 and 2025, corporate restructuring expenses primarily related to incremental costs in connection with transition activities following the establishment of our parent company’s domicile in the United States. ( 2) For the three and six months ended June 30, 2025, business restructuring expenses primarily related to the Company’s implementation of targeted actions to streamline operations, enhancing speed and efficiency to better serve customers and drive further profitable growth. ( 1) ( 2) 9
Page 11
Net Debt : Adjusted EBITDA Reconciliation To assess the appropriateness of its capital structure, the Company’s principal measure of financial leverage is net debt toadjusted EBITDA. The Company aims to operate with investment grade credit metrics and keep this ratio within one to twotimes. Net debt Net debt comprises bank overdrafts, bank and other loans and derivative financial instruments,excluding lease liabilities, less cash and cash equivalents. Long-term debt is presented net of debtissuance costs. As of June 30, (In millions) 2026 2025 Long-term debt $4,456 $3,577 Short-term debt 448 400 Bank overdrafts — 9 Derivative liabilities 1 3 Cash and cash equivalents ( 437) ( 407) Net debt $4,46 8 $3,582 ( 1) Bank overdrafts are included in other current liabilities in the Company’s Consolidated Balance Sheets. Adjusted EBITDA (Rolling 12-month) Adjusted EBITDA is net income before charges/credits relating to depreciation, amortization, impairment and certain non-GAAP adjustments. A rolling 12-month adjusted EBITDA is used in the net debt to adjusted EBITDA ratio to assess theappropriateness of the Company’s financial leverage. Twelve months ended (In millions, except ratios) June 30, 2026 2025 Net income $2,107 $1,857 Provision for income taxes 6 24 540 Interest expense, net 192 189 Other expense ( income), net 22 ( 5) Restructuring activities 2 84 Depreciation and amortization 387 370 Adjusted EBITDA $3,334 $3,035 Net Debt: Adjusted EBITDA 1.3x1.2x ( 1) For the rolling twelve months ended June 30, 2026 , restructuring activities primarily related to incremental costs in connection with transition activities following the establishment of our parent company’s domicile in the United States, partially offset by a gain on the sale of a closed distribution center in November 2025 relating to previous business restructuring activities. For the rolling twelve months ended June 30, 2025, restructuring expenses primarily related to the Company’s implementation of targeted actions to streamline operations, enhancing speed and efficiency to better serve customers and drive further profitable growth, as well as incremental costs in connection with transition activities following the establishment of our parent company’s domicile in the United States. ( 1) ( 1) 10
Page 12
Reconciliation of Net Income to Adjusted Net Income and Adjusted EPS - Diluted Three months ended June 30, (In millions, except per share amounts) 2026 2025 per share per share Net income $6 6 6 $3.43 $6 34 $3.21 Corporate restructuringexpenses 2 0.01 4 0.02 Business restructuringexpenses — — 21 0.10 Amortization of acquired intangibles 37 0.19 39 0.20 Discrete tax adjustments ( 38) ( 0.19) ( 46 ) ( 0.23) Tax impact-non-GAAPadjustments ( 9) ( 0.05) ( 16 ) ( 0.08) Adjusted net income $6 58 $3.39 $6 36 $3.22 Diluted weighted-average shares outstanding 194.0 197.5 Six months ended June 30, (In millions, except per share amounts) 2026 2025 per share per share Net income $1,080 $5.56 $979 $4.94 Corporate restructuringexpenses 4 0.02 4 0.02 Business restructuringexpenses — — 72 0.3 Amortization of acquired intangibles 70 0.36 78 0.40 Discrete tax adjustments ( 34) ( 0.18) ( 43) ( 0.22) Tax impact-non-GAAPadjustments ( 18) ( 0.09) ( 39) ( 0.20) Adjusted net income $1,102 $5.6 7 $1,051 $5.30 Diluted weighted-average shares outstanding 194.4 198.2 ( 1) Per share on a dilutive basis. ( 2) For the three months and six months ended June 30, 2026 and 2025, corporate restructuring expenses primarily related to incremental costs in connection with transition activities following the establishment of our parent company’s domicile in the United States. ( 3) For the three and six months ended June 30, 2025, business restructuring expenses primarily related to the Company’s implementation of targeted actions to streamline operations, enhancing speed and efficiency to better serve customers and drive further profitable growth. ( 4) For the three and six months ended June 30, 2026 and 2025, discrete tax adjustments were mainly related to the release of uncertain tax positions due to the lapsing of statute of limitations, adjustments related to prior year tax positions, as well as tax treatment of certain compensation items that were not individually significant. ( 5) For the three and six months ended June 30, 2026 , the tax impact on non- GAAP adjustments primarily related to the amortization of acquired intangibles. For the three and six months ended June 30, 2025, the tax impact on non-GAAP adjustments related to the restructuring expenses and the amortization of acquired intangibles. (1) (1) ( 2) ( 3) ( 4) ( 5) (1) (1) ( 2) ( 3) ( 4) ( 5) 11
Page 13
Ferguson Enterprises Inc. Condensed Consolidated Statements of Earnings (unaudited) Three months ended Six months ended June 30, June 30, (In millions, except per share amounts) 2026 2025 2026 2025 Net sales $8,751 $8,36 3 $16 ,223 $15,57 Cost of sales ( 6 ,039) ( 5,750) ( 11,193) ( 10,747) Gross profit 2,712 2,6 13 5,030 4,829 Selling, general and administrativeexpenses ( 1,718) ( 1,6 50) ( 3,325) ( 3,215) Restructuring expenses ( 2) ( 25) ( 4) ( 7 ) Depreciation and amortization ( 99) ( 96 ) ( 196 ) ( 189) Operating profit 893 842 1,505 1,349 Interest expense, net ( 52) ( 49) ( 97) ( 95) Other income( expense) 5 ( 3) ( 2) 5 Income before income taxes 846 790 1,406 1,259 Provision for income taxes ( 180) ( 156 ) ( 326 ) ( 280) Net income $6 6 6 $6 34 $1,080 $979 Earnings per share - Basic $3.44 $3.21 $5.56 $4.94 Earnings per share - Diluted $3.43 $3.21 $5.56 $4.94 Weighted average number of shares outstanding: Basic 193.7 197.4 194.1 198.1 Diluted 194.0 197.5 194.4 198.2 12
Page 14
Ferguson Enterprises Inc. Condensed Consolidated Balance Sheets (unaudited) As of (In millions) June 30, 2026 December 31, 2025 Assets Cash and cash equivalents $437 $557 Accounts receivable, net 4,255 3,312 Inventories 5,101 4,588 Prepaid and other current assets 1,195 1,031 Assets held for sale 39 48 Total current assets 11,027 9,53 Property, plant and equipment, net 2,016 1,911 Operating lease right-of-use assets 1,922 1,832 Deferred income taxes, net 76 1 5 Goodwill 2,713 2,470 Other non-current assets 1,549 1,238 Total assets $19,303 $17,152 Liabilities and stockholders’ equity Accounts payable $4,06 0 $3,117 Other current liabilities 2,317 2,008 Total current liabilities 6 ,377 5,125 Long-term debt 4,456 3,978 Long-term portion of operating lease liabilities 1,506 1,43 Other long-term liabilities 76 3 75 Total liabilities 13,102 11,295 Total stockholders' equity 6 ,201 5,857 Total liabilities and stockholders' equity $19,303 $17,152 13
Page 15
Ferguson Enterprises Inc. Condensed Consolidated Statements of Cash Flows (unaudited) (In millions) Six months ended June 30, 2026 2025 Cash flows from operating activities: Net income $1,080 $979 Depreciation and amortization 196 189 Share-based compensation 35 15 Changes in inventories ( 46 8) ( 1 9) Changes in receivables and other assets ( 1,070) ( 844) Changes in accounts payable and other liabilities 1,045 90 Other operating activities ( 102) 47 Net cash provided by operating activities 716 1,123 Cash flows from investing activities: Purchase of businesses acquired, net of cash acquired ( 583) ( 22 ) Capital expenditures ( 234) ( 141) Other investing activities 17 15 Net cash used in investing activities ( 800) ( 352) Cash flows from financing activities: Purchase of treasury shares ( 438) ( 428) Net change in debt and bank overdrafts 775 ( 340) Cash dividends ( 347) ( 330) Other financing activities ( 7) ( 27) Net cash used in financing activities ( 17) ( 1,125) Change in cash, cash equivalents and restricted cash ( 101) ( 354) Effects of exchange rate changes ( 5) 25 Cash, cash equivalents and restricted cash, beginning of period 581 773 Cash, cash equivalents and restricted cash, end of period $475 $444 14