Arxis, Inc.

Previous wording

We generated revenue of $500.7 million for the three months ended June 30, 2026, representing an increase of 25.0% compared to $400.4 million for the 2025 period. Net loss for the for the three months ended June 30, 2026 was $4.9 million compared to $29.3 million for the 2025 period. Adjusted EBITDA was $211.5 million, or 42.2% of revenue, for the three months ended June 30, 2026, compared to $153.7 million, or 38.4% of revenue, for the 2025 period. Refer to“Non-GAAP Financial Measures” in this discussion and analysis for additional information and limitations regarding these non-GAAP financial measures, including a reconciliation to the comparable GAAP financial measure.

Current wording

We generated revenue of $564.0 million for the three months ended September 30, 2026, representing an increase of 36.0% compared to $414.8 million for the 2025 period. Net income for the three months ended September 30, 2026 was $83.7 million compared to a net loss of $10.1 million for the 2025 period. Net income (loss) margin was 14.8% for the three months ended September 30, 2026 compared to (2.4)% for the 2025 period. Adjusted EBITDA was $255.9 million, or 45.4% of revenue, for the three months ended September 30, 2026, compared to $153.5 million, or 37.0% of revenue, for the 2025 period. Refer to “Non-GAAP Financial Measures” in this discussion and analysis for additional information and limitations regarding these non-GAAP financial measures, including a reconciliation to the comparable GAAP financial measure.

Previous wording

Demand across our end markets remained strong during the second quarter of 2026, driven by continued growth in defense and space programs from increasing U.S. and allied budgets, sustained growth in commercial aerospace from robust production rates and aftermarket activity, and solid demand across our industrial technology end markets driven by continued investment in automation and electrification. Our results are supported by disciplined execution, productivity initiatives, and cost management, underscoring the strength and scalability of our proprietary business system – Arxis EDGE (Empower Data-Driven Growth and Execution) – through which we drive team-based selling and accountability, increase cross-selling opportunities across our business units and support our commercial strategy. Additionally, we continue to pursue strategic acquisitions that complement our existing portfolio.

Current wording

Demand across our end markets remained strong during the third quarter of 2026, driven by continued growth in industrial technology from ongoing investment in automation and electrification, sustained growth in commercial aerospace supported by robust production rates and aftermarket activity, and continued demand in defense and space programs supported by increasing U.S. and allied defense budgets. Our results are supported by disciplined execution, productivity initiatives, and cost management, underscoring the strength and scalability of our proprietary business system – Arxis EDGE (Empower Data-Driven Growth and Execution) – through which we drive team-based selling and accountability, increase cross-selling opportunities across our business units and support our commercial strategy. Additionally, we continue to pursue strategic acquisitions that complement our existing portfolio.

Previous wording

The following significant events occurred during or subsequent to the six months ended June 30, 2026.

Current wording

The following significant events occurred during or subsequent to the nine months ended September 30, 2026.

Previous wording

In April 2026, the Company completed its Reorganization and IPO of shares of Class A common stock. The Company’s Class A common stock began trading on the Nasdaq under the ticker symbol “ARXS” on April 16, 2026. Net proceeds from the IPO were $1,220.6 million, after deducting underwriting discounts, commissions and offering costs. A portion of the net proceeds was used to repay $946.0 million of outstanding indebtedness under the Company’s Term Loan Credit Facility, with the remainder to be used for working capital and general corporate purposes.

Current wording

In April 2026, the Company completed its Reorganization and IPO of shares of Class A common stock. The Company’s Class A common stock began trading on the Nasdaq under the ticker symbol “ARXS” on April 16, 2026. Net proceeds from the IPO were $1,220.6 million, after deducting underwriting discounts, commissions and offering costs. A portion of the net proceeds was used to repay $946.0 million of outstanding indebtedness under the Company’s 2025 Term Loan, with the remainder to be used for working capital and general corporate purposes.

Previous wording

On January 5, 2026, the Company acquired 100% of the equity interest of Micro-Tronics, LLC (“Micro-Tronics”), aleading provider of engineered, mission-critical elastomeric and metallic components for commercial aerospace and defense applications. The acquisition expands the Company's product line into adjacent and overlapping capabilities, including elastomeric diaphragm seals and assemblies to high-precision electrical discharge machined components.

Current wording

On January 5, 2026, the Company acquired 100% of the equity interest of Micro-Tronics, LLC (“Micro-Tronics”), a leading provider of engineered, mission-critical elastomeric and metallic components for commercial aerospace and defense applications. The acquisition expands the Company's product line into adjacent and overlapping capabilities, including elastomeric diaphragm seals and assemblies to high-precision electrical discharge machined components.

Previous wording

The following tables set forth a summary of our results of operations for the three and six months ended June 30, 2026 and 2025.

Current wording

The following tables set forth a summary of our results of operations for the three and nine months ended September 30, 2026 and 2025.

Previous wording

For the three months ended June 30, 2026 as compared to the 2025 period, organic revenue increased by $83.9 million, or 21.0%, which was driven by broad-based growth across all of our end markets, led by Industrial Technology, and supported by continued strength in Commercial Aerospace and Defense and Space.

Current wording

For the three months ended September 30, 2026 as compared to the 2025 period, organic revenue increased by $119.0 million, or 28.7%, which was driven by broad-based growth across all of our end markets, led by Industrial Technology, and supported by continued strength in Commercial Aerospace and Defense and Space.

Previous wording

For the three months ended June 30, 2026 as compared to the 2025 period, growth across all of our end markets reflected the combined benefit of higher sales volume and favorable pricing actions. Volume growth reflected increased customer demand across key programs and applications, as well as contributions from new business wins, contributing mid-teens growth led by Industrial Technology and Commercial Aerospace end markets. Pricing contributed a mid-single-digit increase across each of our end markets, reflecting contractual price escalations and price realization actions.

Current wording

For the three months ended September 30, 2026 as compared to the 2025 period, growth across all of our end markets reflected the combined benefit of higher sales volume and favorable pricing actions. Volume growth reflected increased customer demand across key programs and applications, as well as contributions from new business wins, contributing high-teens growth led by Industrial Technology and Commercial Aerospace end markets. Pricing contributed a high-single-digit increase across each of our end markets, reflecting contractual price escalations and price realization actions.

Previous wording

For the six months ended June 30, 2026 as compared to the 2025 period, organic revenue increased by $149.0 million, or 19.1%, including a 1% favorable foreign currency impact. Growth remained broad-based across all of our end markets throughout the first half of 2026.

Current wording

For the nine months ended September 30, 2026 as compared to the 2025 period, organic revenue increased by $268.0 million, or 22.4%. Growth remained broad-based across all of our end markets throughout 2026.

Previous wording

For the six months ended June 30, 2026 as compared to the 2025 period, growth across all end markets reflected the combined benefit of higher sales volume and favorable pricing actions. Volume growth reflected increased customer demand across key programs and applications, as well as contributions from new business wins, contributing low-teens growth across all our end markets. Pricing contributed a mid-single-digit increase across each of our end markets, reflecting contractual price escalations and price realization actions.

Current wording

For the nine months ended September 30, 2026 as compared to the 2025 period, growth across all end markets reflected the combined benefit of higher sales volume and favorable pricing actions. Volume growth reflected increased customer demand across key programs and applications, as well as contributions from new business wins, contributing mid-teens growth led by Industrial Technology, followed by comparable growth in Commercial Aerospace and Defense and Space end markets. Pricing contributed a mid-single-digit increase across each of our end markets, reflecting contractual price escalations and price realization actions.

Previous wording

The favorable demand environment remained consistent throughout the first half of 2026, supported by increased U.S. and allied defense spending, higher commercial aerospace production rates and aftermarket activity, and continued investment in automation and electrification across industrial technology applications.

Current wording

The favorable demand environment remained consistent throughout 2026, supported by increased U.S. and allied defense spending, higher commercial aerospace production rates and aftermarket activity, and continued investment in automation and electrification across industrial technology applications.

Previous wording

For the three and six months ended June 30, 2026 acquisition revenue was $16.4 million and $30.1 million, respectively, which represents revenue from businesses acquired after June 30, 2025 that was not included in the comparable organic revenue base for the period, and is attributable to the acquisitions of Oldham, Micro-Tronics, and MagCanica.

Current wording

Acquisition revenue was $30.1 million for the three months ended September 30, 2026, which represents revenue from businesses that was not included in the comparable organic revenue base for the period, and was primarily attributable to the acquisitions of Omnetics, Micro-Tronics, and MagCanica. Acquisition revenue was $60.2 million for the nine months ended September 30, 2026, and was primarily attributable to the aforementioned acquisitions, as well as revenue from Oldham for the six months ended June 30, 2026, for which there was no comparable revenue in the prior period.

Previous wording

For the three months ended June 30, 2026 as compared to the 2025 period, gross profit increased by $65.0 million, or 32.9%, which was primarily due to improved operating leverage on higher volumes, and partially attributable to favorable price realization, reflecting continued operational execution across the business, and incremental gross profit from the acquisitions of Oldham, Micro-Tronics, and MagCanica.

Current wording

For the three months ended September 30, 2026 as compared to the 2025 period, gross profit increased by $101.8 million, or 49.8%, which was primarily due to improved operating leverage on higher volumes, and partially attributable to favorable price realization, reflecting continued operational execution across the business, and incremental gross profit from the acquisitions of Omnetics, Micro-Tronics, and MagCanica.

Previous wording

For the six months ended June 30, 2026 as compared to the 2025 period, gross profit increased by $136.9 million, or 38.0%, which was primarily due to improved operating leverage on higher volumes, and partially attributable to favorable price realization, reflecting continued operational execution across the business. The increase was also partially attributable to a $16.8 million favorable change in amortization of inventory step-up from acquisitions, and incremental gross profit from the acquisitions of Oldham, Micro-Tronics, and MagCanica.

Current wording

For the nine months ended September 30, 2026 as compared to the 2025 period, gross profit increased by $238.7 million, or 42.3%, which was primarily due to improved operating leverage on higher volumes, and partially attributable to favorable price realization, reflecting continued operational execution across the business. The increase was also partially attributable to a $11.9 million favorable change in amortization of inventory step-up from acquisitions, and incremental gross profit from the acquisitions of Oldham, Micro-Tronics, Omnetics, and MagCanica.

Previous wording

For both the three and six months ended June 30, 2026 as compared to the 2025 period, gross margin increased primarily due to operational leverage on increased volumes and partially attributable to favorable price realization. Continued operational execution initiatives also supported margin expansion.

Current wording

For both the three and nine months ended September 30, 2026 as compared to the 2025 period, gross margin increased primarily due to operational leverage on increased volumes and partially attributable to favorable price realization. Continued operational execution initiatives also supported margin expansion.

Previous wording

Selling, general and administrative expenses increased by $113.1 million, or 140.3%, for the three months ended June 30, 2026 as compared to the 2025 period. Selling, general and administrative expenses increased by $132.7 million, or 89.0%, for the six months ended June 30, 2026 as compared to the 2025 period. These increases were primarily driven by share-based compensation expense and transaction expenses recognized in connection with our IPO.

Current wording

Selling, general and administrative expenses increased by $187.5 million, or 82.8%, for the nine months ended September 30, 2026 as compared to the 2025 period. These increases were primarily driven by share-based compensation expense, transaction expenses recognized in connection with our IPO, Convertible-Related Tax Receivable Agreement expense, expense related to the Jacksonville Business matter, and transaction and other deal-related costs.

Previous wording

Amortization of intangible assets increased by $2.1 million, or 6.1%, for the three months ended June 30, 2026 as compared to the 2025 period. Amortization of intangible assets increased by $4.0 million, or 5.9%, for the six months ended June 30, 2026 as compared to the 2025 period. These increases were due to amortization related to acquired intangible assets.

Current wording

Amortization of intangible assets increased by $5.7 million, or 16.4%, for the three months ended September 30, 2026 as compared to the 2025 period. Amortization of intangible assets increased by $9.8 million, or 9.5%, for the nine months ended September 30, 2026 as compared to the 2025 period. These increases were due to amortization related to acquired intangible assets.

Previous wording

Interest expense, net decreased by $42.2 million, or 33.6%, for the six months ended June 30, 2026 as compared to the 2025 period, which was primarily dueto the repayment of $946.0 million aggregate principal amount of debt in April 2026 using a portion of the proceeds from the IPO.

Current wording

Interest expense, net decreased by $30.4 million, or 62.9%, for the three months ended September 30, 2026 as compared to the 2025 period, which was primarily dueto the repayment of $946.0 million aggregate principal amount of debt in April 2026 using a portion of the proceeds from the IPO, favorable changes in fair value of the interest rate hedges, and lower interest rates.

Previous wording

Interest expense, net decreased by $17.9 million, or 31.3%, for the three months ended June 30, 2026 as compared to the 2025 period, which was primarily dueto the repayment of $946.0 million aggregate principal amount of debt in April 2026 using a portion of the proceeds from the IPO, partially offset by an $11.4 million loss on extinguishment of debt.

Current wording

Interest expense, net decreased by $72.6 million, or 41.8%, for the nine months ended September 30, 2026 as compared to the 2025 period, which was primarily due to the repayment of $946.0 million aggregate principal amount of debt in April 2026 using a portion of the proceeds from the IPO, favorable changes in fair value of the interest rate hedges and lower interest rates, partially offset by a $4.1 million favorable change in losses on extinguishment of debt.

Previous wording

Other income, net increased by $1.7 million for the three months ended June 30, 2026 as compared to the 2025 period. Other income, net increased by $3.0 million for the six months ended June 30, 2026 as compared to the 2025 period. These increases were primarily due to interest income.

Current wording

Other income, net increased by $3.2 million for the three months ended September 30, 2026 as compared to the 2025 period. Other income, net increased by $6.2 million for the nine months ended September 30, 2026 as compared to the 2025 period. These increases were primarily due to interest income.

Previous wording

Income tax expense decreased by $54.8 million for the three months ended June 30, 2026 as compared to the 2025 period. The Company's effective income tax rate was (247.2)% for the three months ended June 30, 2026, compared to 200.6% for the three months ended June 30, 2025. The change in the effective tax rate was primarily due to IPO-related items, including share-based compensation expense, which resulted in a near break-even pre-tax book loss.

Current wording

Income tax expense decreased by $18.9 million for the three months ended September 30, 2026 as compared to the 2025 period. The Company's effective income tax rate was 30.1% for the three months ended September 30, 2026, compared to 122.5% for the three months ended September 30, 2025. The change in the effective tax rate was primarily due to IPO-related items, including share-based compensation expense in 2026, and primarily due to the mix of earnings and losses across jurisdictions subject to different tax rates in 2025.

Previous wording

Income tax expense decreased by $36.6 million for the six months ended June 30, 2026 as compared to the 2025 period. The Company's effective income tax rate was 28.4% for the six months ended June 30, 2026, compared to 250.9% for the six months ended June 30, 2025. The change in the effective tax rate was primarily due to higher pre-tax book income across the Company’s business entities, as well as changes in the jurisdictional mix of earnings and losses in 2026.

Current wording

Income tax expense decreased by $55.5 million for the nine months ended September 30, 2026 as compared to the 2025 period. The Company's effective income tax rate was 29.5% for the nine months ended September 30, 2026, compared to 165.1% for the nine months ended September 30, 2025. The change in the effective tax rate was primarily due to IPO-related items, including share-based compensation expense in 2026, and primarily due to the mix of earnings and losses across jurisdictions subject to different tax rates in 2025.

Previous wording

The following table presents revenue by segment, Segment Adjusted EBITDA and Segment Adjusted EBITDA Margin for the three and six months ended June 30, 2026 and 2025.

Current wording

The following table presents revenue by segment, Segment Adjusted EBITDA and Segment Adjusted EBITDA Margin for the three and nine months ended September 30, 2026 and 2025.

Previous wording

Electronic Components segment revenue increased by $36.7 million, or 20.6%, for the three months ended June 30, 2026 as compared to the 2025 period. Electronic Components segment revenue increased by $68.2 million, or 19.6%, for the six months ended June 30, 2026 as compared to the 2025 period. These increases were primarily due to higher revenue across our Industrial Technology and Defense and Space end markets driven by strong customer demand.

Current wording

Electronic Components segment revenue increased by $76.3 million, or 41.1%, for the three months ended September 30, 2026 as compared to the 2025 period. Electronic Components segment revenue increased by $144.4 million, or 27.1%, for the nine months ended September 30, 2026 as compared to the 2025 period. These increases were primarily due to higher revenue across our Industrial Technology and Defense and Space end markets driven by strong customer demand, and partially attributable to the acquisitions of Omnetics and MagCanica.

Previous wording

Electronic Components Segment Adjusted EBITDA increased by $20.2 million for the three months ended June 30, 2026 as compared to the 2025 period. Electronic Components Segment Adjusted EBITDA increased by $36.6 million for the six months ended June 30,

Current wording

Electronic Components Segment Adjusted EBITDA increased by $51.8 million for the three months ended September 30, 2026 as compared to the 2025 period. Electronic Components Segment Adjusted EBITDA increased by $88.3 million for the nine months ended September 30, 2026 as compared to the 2025 period. These increases were primarily driven by increased operating leverage resulting from higher sales volumes, favorable pricing, continued operational efficiencies, and contributions from the acquisitions of Omnetics and MagCanica.

Previous wording

Mechanical Components segment revenue increased by $63.6 million or 28.6% for the three months ended June 30, 2026 as compared to the 2025 period. Mechanical Components segment revenue increased by $110.9 million or 25.6% for the six months ended June 30, 2026 as compared to the 2025 period. These increases were primarily due to higher revenue across all of our end markets driven by strong customer demand, and partially attributable to the acquisitions of Oldham and Micro-Tronics.

Current wording

Mechanical Components segment revenue increased by $72.9 million or 31.8% for the three months ended September 30, 2026 as compared to the 2025 period. Mechanical Components segment revenue increased by $183.8 million or 27.8% for the nine months ended September 30, 2026 as compared to the 2025 period. These increases were primarily due to higher revenue across all of our end markets driven by strong customer demand, and partially attributable to the acquisitions of Oldham, Micro-Tronics, and Schatz.

Previous wording

Mechanical Components Segment Adjusted EBITDA increased by $42.3 million for the three months ended June 30, 2026 as compared to the 2025 period. Mechanical Components Segment Adjusted EBITDA increased by $74.7 million for the six months ended June 30, 2026 as compared to the 2025 period. These increases were primarily driven by higher sales volumes, which increased operating leverage, together with continued execution of our operational strategy, including operational efficiencies and cost optimization initiatives. These increases were also partially attributable to the acquisitions of Oldham and Micro-Tronics.

Current wording

Mechanical Components Segment Adjusted EBITDA increased by $55.6 million for the three months ended September 30, 2026 as compared to the 2025 period. Mechanical Components Segment Adjusted EBITDA increased by $130.3 million for the nine months ended September 30, 2026 as compared to the 2025 period. These increases were primarily driven by higher sales volumes, which increased operating leverage, favorable pricing, and continued execution of our operational strategy, including operational efficiencies and cost optimization initiatives. These increases were also partially attributable to the acquisitions of Oldham and Micro-Tronics.

Previous wording

Adjusted EBITDA and Adjusted EBITDA Margin exclude share-based compensation expense, which has been, and will continue to be for the foreseeable future, a significant, non-cash recurring expense for our business and an important part of our compensation strategy;

Current wording

Adjusted EBITDA and Adjusted EBITDA Margin exclude share-based compensation expense and certain related employer payroll taxes, which has been, and will continue to be for the foreseeable future, a significant recurring expense for our business and an important part of our compensation strategy;

Previous wording

Adjusted EBITDA is defined as Net income (loss), adjusted for: (i) interest expense, net; (ii) income tax expense (benefit); (iii) depreciation and amortization; (iv) acquisition and integration costs; (v) restructuring costs; (vi) transaction and other deal related expenses; (vii) share-based compensation expense, and (viii) other non-recurring adjustments. Management defines Adjusted EBITDA Margin as Adjusted EBITDA divided by Revenue.

Current wording

Adjusted EBITDA is defined as Net income (loss), adjusted for: (i) interest expense, net; (ii) income tax expense (benefit); (iii) depreciation and amortization; (iv) acquisition and integration costs; (v) restructuring costs; (vi) transaction and other deal related expenses; (vii) share-based compensation expense and certain related employer payroll taxes, and (viii) other non-recurring adjustments. Management defines Adjusted EBITDA Margin as Adjusted EBITDA divided by Revenue.

Previous wording

Represents the compensation expense under our share-based plans and deferred compensation plans. Includes $7.5 million for employer taxes related to vested RSUs for the three and six months ended June 30, 2026.

Current wording

Represents the compensation expense under our share-based plans and deferred compensation plans. Includes $7.5 million for employer taxes related to vested RSUs for the nine months ended September 30, 2026.

Previous wording

Represents other income and expense adjustments that are non-recurring, non-operational, or not reflective of core performance, such as loss on disposal of assets, commercial commitments or legal settlements, income from transition services agreements and non-operational pension impacts. Includes $13.3 million of expense related to the Convertible-Related Tax Receivable Agreement for the three and six months ended June 30, 2026.

Current wording

Represents other income and expense adjustments that are non-recurring, non-operational, or not reflective of core performance, such as loss on disposal of assets, commercial commitments or legal settlements, income from transition services agreements and non-operational pension impacts. Includes $13.3 million of expense related to the Convertible-Related Tax Receivable Agreement for the nine months ended September 30, 2026, and $12.0 million of expense related to the Jacksonville Business matter for the three and nine months ended September 30, 2026.

Previous wording

Historically, our primary sources of liquidity have been cash and cash equivalents, cash flows from our operating activities and borrowings under our credit agreements, including revolving credit facilities. In April 2026, the Company completed its IPO of shares of Class A common stock. Net proceeds from the IPO were $1,220.6 million, after deducting underwriting discounts, commissions and offering costs. A portion of the net proceeds was used to repay $946.0 million of outstanding indebtedness under the Company’s Term Loan Credit Facility, with the remainder to be used for working capital and general corporate purposes. Our principal historical liquidity requirements have been for acquisitions, capital expenditures, servicing indebtedness and working capital needs. As we continue to expand our business, we may require additional working capital in the future for increased costs, and although we believe that we will be able to fully fund our ongoing capital expenditures, working capital requirements and other capital needs for the foreseeable future through cash on hand and cash flows from our operating activities, we may choose to use borrowings under our credit facilities to finance our operating and investing activities. Based on our current outlook, we believe that net cash provided by operating activities and available borrowings under our credit agreements will be sufficient to fund our cash requirements for at least the next twelve months.

Current wording

Historically, our primary sources of liquidity have been cash and cash equivalents, cash flows from our operating activities and borrowings under our credit agreements, including revolving credit facilities. In April 2026, the Company completed its IPO of shares of Class A common stock. Net proceeds from the IPO were $1,220.6 million, after deducting underwriting discounts, commissions and offering costs. A portion of the net proceeds was used to repay $946.0 million of outstanding indebtedness under the Company’s 2025 Term Loan, with the remainder to be used for working capital and general corporate purposes. Our principal historical liquidity requirements have been for acquisitions, capital expenditures, servicing indebtedness and working capital needs. As we continue to expand our business, we may require additional working capital in the future for increased costs, and although we believe that we will be able to fully fund our ongoing capital expenditures, working capital requirements and other capital needs for the foreseeable future through cash on hand and cash flows from our operating activities, we may choose to use borrowings under our credit facilities to finance our operating and investing activities. Based on our current outlook, we believe that net cash provided by operating activities and available borrowings under our credit agreements will be sufficient to fund our cash requirements for at least the next twelve months.

Previous wording

As of June 30, 2026, we had $1,732.9 million of borrowings outstanding under the Term Loan Credit Facility, and a $201.0 million commitment under our delayed draw term loan (“DDTL”), all of which was undrawn as of June 30, 2026. We had no outstanding balance under our senior secured revolving credit facility (the “Revolving Credit Facility”, and together with the Term Loan Credit Facility and DDTL, the "Credit Facilities") and $3.7 million letters of credit outstanding, resulting in an available borrowing capacity of $396.3 million on the Revolving Credit Facility.

Current wording

As of September 30, 2026, we had $1,732.9 million of borrowings outstanding under the 2025 Term Loan, and a $201.0 million commitment under our delayed draw term loan (“DDTL”), all of which was undrawn as of September 30, 2026. We had no outstanding balance under our senior secured revolving credit facility (the “Revolving Credit Facility”, and together with the 2025 Term Loan and DDTL, the "Credit Facilities") and $3.7 million letters of credit outstanding, resulting in an available borrowing capacity of $396.3 million on the Revolving Credit Facility.

Previous wording

Cash provided by operating activities increased by $105.7 million for the six months ended June 30, 2026 as compared to the 2025 period, primarily due to an increase in Net income, adjusted for non-cash items, of $144.2 million, partially offset by an increase in cash outflow from the cash impacts of changes in working capital of $23.8 million. Our overall decrease in working capital performance was primarily attributable to a decrease of $28.4 million in Accounts payable and Accrued expenses and other current liabilities for the timing and amount of vendor payments, an increase of $24.7 million in Accounts receivable primarily due to higher revenue, partially offset by a decrease of $15.1 million in Inventory primarily due to lower purchasing activity and a decrease of $14.2 million in Prepaid expenses and other current assets primarily due to income tax receivables. In addition to the decrease in overall working capital, cash outflow from net contract liabilities increased by $14.2 million, which was primarily due to the timing of progress billings.

Current wording

Cash provided by operating activities increased by $197.2 million for the nine months ended September 30, 2026 compared to the 2025 period. This increase is primarily due to an increase in Net income, adjusted for non-cash items, of $271.6 million, partially offset by an increase in cash outflow from the cash impacts of changes in working capital of $57.9 million. Our overall decrease in working capital performance was primarily attributable to a decrease of $60.7 million in Accounts payable and Accrued expenses and other current liabilities for the timing and amount of vendor payments, an increase of $44.5 million in Accounts receivable primarily due to higher revenue, partially offset by a decrease of $40.2 million in Prepaid expenses and other current assets primarily due to income tax receivables and a decrease of $7.0 million in Inventory primarily due to lower purchasing activity. In addition to the decrease in overall working capital, cash outflow from net contract liabilities increased by $6.9 million, which was primarily due to the timing of progress billings.

Previous wording

Net cash used in investing activities for the six months ended June 30, 2026 was $208.0 million, andrelated to $185.8 million cash consideration paid for acquisitions and $22.3 million of capital expenditures.

Current wording

Net cash used in investing activities for the nine months ended September 30, 2026 was $379.1 million, and related to $337.4 million cash consideration paid for acquisitions and $41.8 million of capital expenditures.

Previous wording

Net cash used in investing activities for the six months ended June 30, 2025 was $171.8 million, andrelated to $152.6 million cash consideration paid for acquisitions and $21.4 million of capital expenditures.

Current wording

Net cash used in investing activities for the nine months ended September 30, 2025 was $180.7 million, and related to $152.6 million cash consideration paid for acquisitions and $30.2 million of capital expenditures.

Previous wording

Net cash provided by financing activities for the six months ended June 30, 2026 was $279.2 million, andprimarily related to proceeds from the Company's IPO of $1,227.8 million, $25.0 million of proceeds from the issuance of debt, $11.3 million in contributions, and $5.4 million of proceeds from the settlement of related party notes receivable, partially offset by $952.8 million of debt repayments.

Current wording

Net cash provided by financing activities for the nine months ended September 30, 2026 was $280.2 million, and primarily related to proceeds from the Company's IPO of $1,227.8 million, $25.0 million of proceeds from the issuance of debt, $11.3 million in contributions, and $6.5 million of proceeds from the settlement of related party notes receivable, partially offset by $952.8 million of debt repayments and $34.7 million of payments for employee tax withholding on share-based compensation awards.

Previous wording

Net cash provided by financing activities for the six months ended June 30, 2025 was $171.3 million, andprimarily related to $146.7 million of proceeds from the issuance of debt, net of debt repayments and debt financing fees, and $385.0 million in contributions, partially offset by $351.1 million in distributions and $7.0 million of repayments of related party payables.

Current wording

Net cash provided by financing activities for the nine months ended September 30, 2025 was $94.5 million, and primarily related to $72.0 million of proceeds from the issuance of debt, net of debt repayments and debt financing fees, $22.7 million in contributions, net of distributions, and $10.9 million of proceeds from issuance of members units, partially offset by $7.0 million of repayments of related party payables, and $3.0 million of issuances of related party notes receivables, net of settlements.

Previous wording

On February 26, 2025, wholly-owned subsidiaries of the Arxis Businesses entered into the Credit Agreement with a consortium of banks, led by Citibank, N.A. Borrowings under the Term Loan Credit Facility mature on, and remaining commitments under the DDTL thereunder terminate on, February 26, 2032. In June 2026, the Company amended the 2025 Credit Agreement to reduce the applicable interest rate margin by 25 basis points, reduce the available commitments on the 2025 DDTL from $250.0 million to $201.0 million, and amend the prepayment schedule such that the outstanding principal amounts are due in full at maturity.

Current wording

On February 26, 2025, wholly-owned subsidiaries of the Arxis Businesses entered into the Credit Agreement with a consortium of banks, led by Citibank, N.A. Borrowings under the 2025 Term Loan mature on, and remaining commitments under the DDTL thereunder terminate on, February 26, 2032. In June 2026, the Company amended the 2025 Credit Agreement to reduce the applicable interest rate margin by 25 basis points, reduce the available commitments on the 2025 DDTL from $250.0 million to $201.0 million, and amend the prepayment schedule such that the outstanding principal amounts are due in full at maturity.

Previous wording

We may draw on the DDTL until February 26, 2027. Borrowings under the Revolving Credit Facility mature on, and remaining commitments under the Revolving Credit Facility terminate on, February 26, 2030. The Credit Agreement contains customary conditions on the availability of commitments thereunder, including that our consolidated first-lien net leverage ratio is below specified thresholds. The interest rates on borrowings under the Revolving Credit Facility, DDTL, and Term Loan Credit Facility are calculated in accordance with the Credit Agreement and based on our consolidated first-lien net leverage ratio. We have the right to prepay borrowings at any time, subject to certain prepayment premiums applicable in connection with prepayments resulting from certain repricing events. We are obligated to prepay borrowings under certain circumstances, including using excess cash flows and proceeds from certain asset sales, casualty events and from issuances or incurrences of certain indebtedness. The obligations under the Credit Agreement are guaranteed by the restricted subsidiaries of the borrowers and, pursuant to the related holdings guarantee, which is filed as an exhibit to the registration statement of which our Prospectus forms a part, by the holding companies of the borrowers, which holding companies are also our wholly-owned subsidiaries. The obligations under the Credit Agreement are secured by substantially all of our assets, which security interests are granted pursuant to the related security agreement, which is filed as an exhibit to the registration statement of our Prospectus.

Current wording

We may draw on the DDTL until February 26, 2027. Borrowings under the Revolving Credit Facility mature on, and remaining commitments under the Revolving Credit Facility terminate on, February 26, 2030. The Credit Agreement contains customary conditions on the availability of commitments thereunder, including that our consolidated first-lien net leverage ratio is below specified thresholds. The interest rates on borrowings under the Revolving Credit Facility, DDTL, and 2025 Term Loan are calculated in accordance with the Credit Agreement and based on our consolidated first-lien net leverage ratio. We have the right to prepay borrowings at any time, subject to certain prepayment premiums applicable in connection with prepayments resulting from certain repricing events. We are obligated to prepay borrowings under certain circumstances, including using excess cash flows and proceeds from certain asset sales, casualty events and from issuances or incurrences of certain indebtedness. The obligations under the Credit Agreement are guaranteed by the restricted subsidiaries of the borrowers and, pursuant to the related holdings guarantee, which is filed as an exhibit to the registration statement of which our Prospectus forms a part, by the holding companies of the borrowers, which holding companies are also our wholly-owned subsidiaries. The obligations under the Credit Agreement are secured by substantially all of our assets, which security interests are granted pursuant to the related security agreement, which is filed as an exhibit to the registration statement of our Prospectus.