The company expects gross margin during the remainder of 2025 will be negatively impacted by the recent escalation in global trade disputes/tariffs. As previously mentioned, we are implementing various actions to mitigate the effect of the tariffs.

The company spent $218.7 million on share repurchases during the three months ended March 31, 2025. This indicates a continued commitment to returning capital to shareholders, despite the decrease in net sales.

Selling, general, and administrative expenses increased to 27.5% of net sales for the three months ended March 31, 2025, compared to 25.3% in the corresponding period of 2024. This increase suggests potential inefficiencies in cost management or increased investments in sales and marketing.

Management is actively implementing various actions to mitigate the effect of the tariffs, indicating a proactive approach to addressing external challenges. They estimate the associated annualized cost increase of the incremental 2025 tariffs is approximately $115 million.

The recent escalation in global trade disputes/tariffs has increased economic uncertainty in end markets and the global economic environment, potentially impacting financial results. The company estimates associated annualized cost increase of the incremental 2025 tariffs is approximately $115 million.

Earnings are affected by changing exchange rates, with sensitivity to changes in the exchange rates between the Swiss franc, euro, Chinese renminbi, and U.S. dollar. A 1% strengthening of the Swiss franc against the euro would reduce earnings before tax by approximately $2.4 million to $2.7 million annually.

Net sales by geographic destination decreased in the Americas, Europe, and Asia/Rest of World, with varying degrees of impact when considering local currencies and shipping delays. This suggests differing competitive dynamics and market conditions across regions.

Cost of sales as a percentage of net sales was 40.5% for the three months ended March 31, 2025, compared to 40.8% for the corresponding period in 2024. This suggests a consistent level of operational efficiency in managing production costs.

Based on our outstanding debt at March 31, 2025, we estimate that a 5% weakening of the U.S. dollar against the currencies in which our debt is denominated would result in an increase of approximately $47.6 million in the reported U.S. dollar value of our debt.

The recent escalation in global trade disputes/tariffs has increased economic uncertainty in our end markets and the global economic environment, including increasing the risk of recession in many countries.