Accounting Policies	9 Months Ended
Sep. 27, 2026
Accounting Policies
Accounting Policies	2. Accounting Policies The significant accounting policies used in preparation of these consolidated financial statements for the nine months ended September 27, 2026, are consistent with those discussed in Note 2 of the Notes to Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. Shipping and Handling Shipping and handling costs included in selling, general and administrative expenses amounted to $23.9 million and $21.8 million for the third quarters of 2026 and 2025, respectively, and were $70.4 million and $66.8 million for the nine months of 2026 and 2025, respectively. Research and Development Research and development costs included in selling, general and administrative expenses amounted to $19.4 million and $18.8 million for the third quarters of 2026 and 2025, respectively, and were $59.5 million and $52.9 million for the nine months of 2026 and 2025, respectively. Tariffs The Company was the importer of record and paid tariffs on certain imported raw materials and products under the International Emergency Economic Powers Act (“IEEPA”). On February 20, 2026, the U.S. Supreme Court ruled that tariffs imposed under IEEPA were not authorized by the statute. Following this ruling, the Company submitted tariff recovery claims through the U.S. Customs and Border Protection (“CBP”) seeking a refund of certain eligible IEEPA tariffs. During the third quarter of fiscal 2026, the Company received approximately $39.3 million in tariff refunds, plus interest, from U.S. CBP, which represents the majority of previously paid IEEPA tariffs. The refunds related to tariffs previously capitalized into inventory, all of which had been sold as of September 27, 2026. As a result, the full benefit of the refunds was recognized on the consolidated statement of operations as a reduction to cost of goods sold for the three and nine months ended September 27, 2026, as the Company elected to apply the gain contingency model and recognize the tariff refunds when realized. Accounting Standard Updates In November 2024, the FASB issued ASU No. 2024-03 "Income Statement - Reporting Comprehensive Income (Subtopic 220-40): Expense Disaggregation Disclosures" to expand the disclosure requirements of certain expense categories included in the income statement. ASU 2024-03 is effective for annual periods beginning January 1, 2027, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on the Company’s consolidated financial statement disclosures. In July 2025, the FASB issued ASU No. 2025-05 “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets”. The amendments in this update provide a practical expedient permitting an entity to assume the conditions at the balance sheet date remain unchanged over the life of the asset when estimating expected credit losses for current classified accounts receivable and contract assets. ASU 2025-05 is effective for annual periods beginning after December 15, 2025, including interim periods within those fiscal years. Adoption of this ASU can be applied prospectively for reporting periods after its effective date. The Company adopted the ASU effective January 1, 2026 on a prospective basis and elected the practical expedient for the calculation of current expected credit losses. The adoption did not have a material impact on the Company’s allowance for doubtful accounts. In September 2025, the FASB issued ASU No. 2025-06 “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software”. ASU 2025-06 simplifies the capitalization guidance by removing all references to prescriptive and sequential software development stages (referred to as “project stages”) throughout ASC 350-40. ASU 2025-06 is effective for annual periods beginning after December 15, 2027, and interim periods within those fiscal years. Adoption of ASU 2025-06 can be applied prospectively for reporting periods after its effective date; or follow a modified transition approach that is based on the status of the respective projects and whether software costs were capitalized before the date of adoption; or retrospectively to any or all prior periods presented in the consolidated financial statements. Early adoption is permitted. The Company is evaluating the provisions of ASU 2025-06 and the potential effect it will have on the Company’s consolidated financial statements and disclosures.

Accounting Policies

9 Months Ended

Sep. 27, 2026

2. Accounting Policies

The significant accounting policies used in preparation of these consolidated financial statements for the nine months ended September 27, 2026, are consistent with those discussed in Note 2 of the Notes to Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

Shipping and Handling

Shipping and handling costs included in selling, general and administrative expenses amounted to $23.9 million and $21.8 million for the third quarters of 2026 and 2025, respectively, and were $70.4 million and $66.8 million for the nine months of 2026 and 2025, respectively.

Research and Development

Research and development costs included in selling, general and administrative expenses amounted to $19.4 million and $18.8 million for the third quarters of 2026 and 2025, respectively, and were $59.5 million and $52.9 million for the nine months of 2026 and 2025, respectively.

Tariffs

The Company was the importer of record and paid tariffs on certain imported raw materials and products under the International Emergency Economic Powers Act (“IEEPA”). On February 20, 2026, the U.S. Supreme Court ruled that tariffs imposed under IEEPA were not authorized by the statute. Following this ruling, the Company submitted tariff recovery claims through the U.S. Customs and Border Protection (“CBP”) seeking a refund of certain eligible IEEPA tariffs.

During the third quarter of fiscal 2026, the Company received approximately $39.3 million in tariff refunds, plus interest, from U.S. CBP, which represents the majority of previously paid IEEPA tariffs. The refunds related to tariffs previously capitalized into inventory, all of which had been sold as of September 27, 2026. As a result, the full benefit of the refunds was recognized on the consolidated statement of operations as a reduction to cost of goods sold for the three and nine months ended September 27, 2026, as the Company elected to apply the gain contingency model and recognize the tariff refunds when realized.

Accounting Standard Updates

In November 2024, the FASB issued ASU No. 2024-03 "Income Statement - Reporting Comprehensive Income (Subtopic 220-40): Expense Disaggregation Disclosures" to expand the disclosure requirements of certain expense categories included in the income statement. ASU 2024-03 is effective for annual periods beginning January 1, 2027, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on the Company’s consolidated financial statement disclosures.

In July 2025, the FASB issued ASU No. 2025-05 “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets”. The amendments in this update provide a practical expedient permitting an entity to assume the conditions at the balance sheet date remain unchanged over the life of the asset when estimating expected credit losses for current classified accounts receivable and contract assets. ASU 2025-05 is effective for annual periods beginning after December 15, 2025, including interim periods within those fiscal years. Adoption of this ASU can be applied prospectively for reporting periods after its effective date. The Company adopted the ASU effective January 1, 2026 on a prospective basis and elected the practical expedient for the calculation of current expected credit losses. The adoption did not have a material impact on the Company’s allowance for doubtful accounts.

In September 2025, the FASB issued ASU No. 2025-06 “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software”. ASU 2025-06 simplifies the capitalization guidance by removing all references to prescriptive and sequential software development stages (referred to as “project stages”) throughout ASC 350-40. ASU 2025-06 is effective for annual periods beginning after December 15, 2027, and interim periods within those fiscal years. Adoption of ASU 2025-06 can be applied prospectively for reporting periods after its effective date; or follow a modified transition approach that is based on the status of the respective projects and whether software costs were capitalized before the date of adoption; or retrospectively to any or all prior periods presented in the consolidated financial statements. Early adoption is permitted. The Company is evaluating the provisions of ASU 2025-06 and the potential effect it will have on the Company’s consolidated financial statements and disclosures.