Lincoln Electric
LECO
#1507
Rank
$14.59 B
Marketcap
$266.25
Share price
0.47%
Change (1 day)
46.20%
Change (1 year)

Lincoln Electric - 10-Q quarterly report FY


Text size:
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2026

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to _____________

Commission File Number:  0-1402

Graphic

LINCOLN ELECTRIC HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Ohio

 

34-1860551

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

22801 St. Clair Avenue, Cleveland, Ohio

44117

(Address of principal executive offices)

(Zip Code)

(216) 481-8100

(Registrant’s telephone number, including area code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of exchange on which registered

Common Shares, without par value

LECO

The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes   No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes   No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “small reporting company”, and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

 

Accelerated filer

Non-accelerated filer

 

Smaller reporting company

 

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes  No

The number of shares outstanding of the registrant’s common shares as of March 31, 2026 was 54,787,110.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

LINCOLN ELECTRIC HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

(In thousands, except per share amounts)

Three Months Ended

March 31, 

  ​ ​ ​

2026

  ​ ​ ​

2025

Net sales (Note 2)

  ​ ​ ​

$

1,121,434

  ​ ​ ​

$

1,004,388

Cost of goods sold

 

722,302

 

638,940

Gross profit

 

399,132

 

365,448

Selling, general & administrative expenses

 

210,811

 

196,665

Rationalization and asset impairment net charges (Note 6)

 

2,163

 

3,865

Operating income

 

186,158

 

164,918

Interest expense, net

 

13,374

 

12,127

Other income

 

570

 

444

Income before income taxes

 

173,354

 

153,235

Income taxes (Note 11)

 

36,972

 

34,748

Net income

$

136,382

$

118,487

Basic earnings per share (Note 3)

$

2.49

$

2.11

Diluted earnings per share (Note 3)

$

2.47

$

2.10

Cash dividends declared per share

$

0.79

$

0.75

See notes to these consolidated financial statements.

3

LINCOLN ELECTRIC HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

(In thousands)

Three Months Ended March 31, 

  ​ ​ ​

2026

  ​ ​ ​

2025

Net income

  ​ ​ ​

$

136,382

  ​ ​ ​

$

118,487

Other comprehensive (loss) income, net of tax:

 

  ​

 

  ​

Unrealized (loss) gain on derivatives designated and qualifying as cash flow hedges

(1,323)

829

Defined benefit pension plan activity

(56)

(1,285)

Currency translation adjustment

 

(6,459)

 

29,679

Other comprehensive (loss) income:

 

(7,838)

 

29,223

Comprehensive income

$

128,544

$

147,710

See notes to these consolidated financial statements.

4

LINCOLN ELECTRIC HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

March 31, 2026

December 31, 2025

(UNAUDITED)

(NOTE 1)

ASSETS

  ​ ​ ​

  ​

  ​ ​ ​

  ​

Current Assets

 

  ​

 

  ​

Cash and cash equivalents

$

298,903

$

308,789

Accounts receivable (less allowance for doubtful accounts of $10,662 in 2026; $11,326 in 2025)

 

598,315

 

538,791

Inventories (Note 8)

 

693,938

 

633,364

Other current assets

 

272,288

 

258,568

Total Current Assets

 

1,863,444

 

1,739,512

Property, plant and equipment (less accumulated depreciation of $954,195 in 2026; $942,806 in 2025)

720,836

702,762

Goodwill

 

886,373

 

886,686

Other assets

 

429,742

 

448,617

TOTAL ASSETS

$

3,900,395

$

3,777,577

LIABILITIES AND EQUITY

 

 

  ​

Current Liabilities

 

 

  ​

Short-term debt (Note 10)

$

163,502

$

143,780

Trade accounts payable

 

448,138

 

364,934

Accrued employee compensation and benefits

 

110,861

 

116,158

Other current liabilities

 

297,856

 

331,819

Total Current Liabilities

 

1,020,357

 

956,691

Long-term debt, less current portion (Note 10)

 

1,150,138

 

1,150,228

Other liabilities

 

218,640

 

200,864

Total Liabilities

 

2,389,135

 

2,307,783

Shareholders' Equity

 

 

  ​

Common shares, without par value - at stated capital amount; authorized 240,000,000 shares; issued 98,581,434 shares in 2026 and 2025; outstanding 54,787,110 shares in 2026 and 54,845,950 in 2025

 

9,858

 

9,858

Additional paid-in capital

 

612,391

 

601,566

Retained earnings

 

4,435,760

 

4,342,080

Accumulated other comprehensive loss

 

(213,769)

 

(205,931)

Treasury shares, at cost - 43,794,324 shares in 2026 and 43,735,484 shares in 2025

 

(3,332,980)

 

(3,277,779)

Total Equity

 

1,511,260

 

1,469,794

TOTAL LIABILITIES AND TOTAL EQUITY

$

3,900,395

$

3,777,577

See notes to these consolidated financial statements.

5

LINCOLN ELECTRIC HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(UNAUDITED)

(In thousands, except per share amounts)

  ​ ​ ​

  ​ ​ ​

  ​ ​ ​

  ​ ​ ​

  ​ ​ ​

Accumulated

  ​ ​ ​

  ​ ​ ​

Common

Additional

Other

Shares

Common

Paid-In

Retained

Comprehensive

Treasury

  ​ ​ ​

Outstanding

  ​ ​ ​

Shares

  ​ ​ ​

Capital

  ​ ​ ​

Earnings

  ​ ​ ​

Income (Loss)

  ​ ​ ​

Shares

  ​ ​ ​

Total

Balance at December 31, 2025

 

54,846

$

9,858

$

601,566

$

4,342,080

$

(205,931)

$

(3,277,779)

$

1,469,794

Net income

 

136,382

 

136,382

Defined benefit pension plan activity, net of tax

 

(56)

 

(56)

Unrealized loss on derivatives designated and qualifying as cash flow hedges, net of tax

 

(1,323)

 

(1,323)

Currency translation adjustment, net of tax

 

(6,459)

 

(6,459)

Cash dividends declared – $0.79 per share

 

(43,408)

 

(43,408)

Stock-based compensation activity

 

151

16,670

1,469

 

18,139

Purchase of shares for treasury

 

(210)

(56,670)

 

(56,670)

Other

 

(5,845)

706

 

(5,139)

Balance at March 31, 2026

 

54,787

$

9,858

$

612,391

$

4,435,760

$

(213,769)

$

(3,332,980)

$

1,511,260

  ​ ​ ​

  ​ ​ ​

  ​ ​ ​

  ​ ​ ​

  ​ ​ ​

Accumulated

  ​ ​ ​

  ​ ​ ​

Common

Additional

Other

Shares

Common

Paid-In

Retained

Comprehensive

Treasury

  ​ ​ ​

Outstanding

  ​ ​ ​

Shares

  ​ ​ ​

Capital

  ​ ​ ​

Earnings

  ​ ​ ​

Income (Loss)

  ​ ​ ​

Shares

  ​ ​ ​

Total

Balance at December 31, 2024

 

56,211

$

9,858

$

566,740

$

3,993,016

$

(300,135)

$

(2,942,046)

$

1,327,433

Net income

 

118,487

 

118,487

Defined benefit pension plan activity, net of tax

 

(1,285)

 

(1,285)

Unrealized gain on derivatives designated and qualifying as cash flow hedges, net of tax

 

829

 

829

Currency translation adjustment, net of tax

 

29,679

 

29,679

Cash dividends declared – $0.75 per share

 

(42,073)

 

(42,073)

Stock-based compensation activity

 

157

13,105

1,501

 

14,606

Purchase of shares for treasury

 

(542)

(106,694)

 

(106,694)

Other

 

1,405

(2,217)

 

(812)

Balance at March 31, 2025

 

55,826

$

9,858

$

581,250

$

4,067,213

$

(270,912)

$

(3,047,239)

$

1,340,170

6

LINCOLN ELECTRIC HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(In thousands)

Three Months Ended March 31, 

  ​ ​ ​

  ​ ​ ​

2026

  ​ ​ ​

2025

CASH FLOWS FROM OPERATING ACTIVITIES

 

  ​

  ​

Net income

$

136,382

$

118,487

Adjustments to reconcile Net income to Net cash provided by operating activities:

 

  ​

 

  ​

Depreciation and amortization

 

26,009

 

23,784

Deferred income taxes

 

22,533

 

(5,838)

Stock-based compensation

 

9,580

 

8,352

Other, net

 

(1,516)

 

282

Changes in operating assets and liabilities, net of effects from acquisitions:

 

 

  ​

Increase in accounts receivable

 

(60,212)

 

(34,108)

Increase in inventories

 

(61,876)

 

(20,167)

(Increase) decrease in other current assets

 

(13,471)

 

2,057

Increase in trade accounts payable

 

83,784

 

64,884

(Decrease) increase in other current liabilities

 

(43,138)

 

21,206

Net change in other assets and liabilities

 

4,095

 

6,754

NET CASH PROVIDED BY OPERATING ACTIVITIES

 

102,170

 

185,693

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

  ​

Capital expenditures

 

(39,163)

 

(26,949)

Acquisition of businesses, net of cash acquired

 

140

 

Proceeds from sale of property, plant and equipment

 

308

 

4,646

NET CASH USED BY INVESTING ACTIVITIES

 

(38,715)

 

(22,303)

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

  ​

Proceeds from (payments on) short-term borrowings, net

19,613

(904)

Payments on long-term borrowings

 

 

(169)

Proceeds from exercise of stock options

 

8,559

 

6,254

Purchase of shares for treasury

 

(56,670)

 

(106,694)

Cash dividends paid to shareholders

 

(44,071)

 

(42,975)

NET CASH USED BY FINANCING ACTIVITIES

 

(72,569)

 

(144,488)

Effect of exchange rate changes on Cash and cash equivalents

 

(772)

 

(1,459)

(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS

 

(9,886)

 

17,443

Cash and cash equivalents at beginning of period

 

308,789

 

377,262

CASH AND CASH EQUIVALENTS AT END OF PERIOD

$

298,903

$

394,705

See notes to these consolidated financial statements.

7

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Dollars in thousands, except per share amounts

NOTE 1 — SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The consolidated financial statements include the accounts of Lincoln Electric Holdings, Inc. and its wholly-owned and majority-owned subsidiaries for which it has a controlling interest (the “Company”) after elimination of all inter-company accounts, transactions and profits.

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these unaudited consolidated financial statements do not include all of the information and notes required by GAAP for complete financial statements. However, in the opinion of management, these unaudited consolidated financial statements contain all the adjustments (consisting of normal recurring accruals) considered necessary to present fairly the financial position, results of operations and cash flows for the interim periods. Operating results for the three months ended March 31, 2026 are not necessarily indicative of the results to be expected for the year ending December 31, 2026.

The accompanying Condensed Consolidated Balance Sheet at December 31, 2025 has been derived from the audited financial statements at that date, but does not include all of the information and notes required by GAAP for complete financial statements. For further information, refer to the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

Certain reclassifications have been made to the prior period amounts to conform to the current period presentation, none of which are material.

New Accounting Pronouncements:

This section provides a description of new accounting pronouncements (“Accounting Standards Updates” or “ASUs”) issued by the Financial Accounting Standards Board (“FASB”) that are applicable to the Company.

8

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

The Company is currently evaluating the impact on its financial statements of the following ASUs:

Standard

Description

ASU No. 2025-09, Derivatives and Hedging, issued November 2025

Updates hedge accounting guidance to better align financial reporting with risk management activities. The amendments are effective for annual periods beginning after December 15, 2026 and interim periods within those annual reporting periods. Early adoption is permitted.

ASU No. 2025-06, Goodwill and Other – Internal-Use Software, issued September 2025

Updates requirements for capitalization of internal-use software costs. The amendments are effective for annual periods beginning after December 15, 2027 and interim periods within those annual reporting periods. Early adoption is permitted.

ASU No. 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures, issued November 2024

Requires enhanced disclosures of specified information about certain costs and expenses. The amendments are effective for annual periods beginning January 1, 2027, and interim periods beginning January 1, 2028. Early adoption is prohibited.

NOTE 2 — REVENUE RECOGNITION

The following table presents the Company’s Net sales disaggregated by product line:

Three Months Ended March 31, 

  ​ ​ ​

2026

  ​ ​ ​

2025

  ​ ​ ​

Consumables

$

636,009

$

520,603

Equipment

 

275,157

 

268,507

Automation

210,268

215,278

Net sales

$

1,121,434

$

1,004,388

Consumable sales consist of welding, brazing and soldering filler metals. Equipment sales consist of arc welding equipment, laser, plasma and oxyfuel cutting systems, wire feeding systems, fume control equipment, welding accessories, specialty gas regulators, mobile power equipment, wear solutions, software and education solutions. Automation sales consist of a comprehensive portfolio of solutions for joining, cutting, material handling, module assembly, and end of line testing. Consumable and Equipment products are sold within each of the Company’s operating segments. Automation products are sold within the Company’s Americas Welding and International Welding operating segments.

Within the Automation product line, there are certain customer contracts related to automation products that may include multiple performance obligations. For such arrangements, the Company allocates revenue to each performance obligation based on its relative standalone selling price. The Company generally determines the standalone selling price based on the prices charged to customers or using expected cost plus margin. Approximately 10% of the Company’s consolidated Net sales are recognized over time.

At March 31, 2026, the Company recorded $42,404 related to advance customer payments and $53,660 related to billings in excess of revenue recognized. These contract liabilities are included in Other current liabilities in the Condensed Consolidated Balance Sheets. At December 31, 2025, the balances related to advance customer payments and billings in excess of revenue recognized were $49,451 and $62,778, respectively. Substantially all of the Company’s contract liabilities are recognized within twelve months based on contract duration. The Company records an asset for contracts where it has recognized revenue, but has not yet invoiced the customer for goods or services.

9

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LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

At March 31, 2026 and December 31, 2025, the Company recorded $86,576 and $78,211, respectively, related to these contract assets which are included in Other current assets in the Condensed Consolidated Balance Sheets. Contract asset amounts are expected to be billed within the next twelve months.

NOTE 3 — EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share:

Three Months Ended March 31, 

 

2026

 

2025

Numerator:

 

  ​

 

  ​

Net income

$

136,382

$

118,487

Denominator (shares in 000's):

 

 

Basic weighted average shares outstanding

 

54,822

 

56,058

Effect of dilutive securities - Stock options and awards

 

495

 

469

Diluted weighted average shares outstanding

 

55,317

 

56,527

Basic earnings per share

$

2.49

$

2.11

Diluted earnings per share

$

2.47

$

2.10

For the three months ended March 31, 2026 and 2025, common shares subject to equity-based awards of 39,570 and 21,704, respectively, were excluded from the computation of diluted earnings per share because the effect of their exercise would be anti-dilutive.

NOTE 4 — ACQUISITIONS

The acquired company discussed below is accounted for as a business combination and is included in the consolidated financial statements as of the date of acquisition. The acquired company is not material to the actual or pro forma Consolidated Statements of Income or Consolidated Statements of Cash Flows; as such, pro forma information related to this acquisition has not been presented.

On April 1, 2025, the Company acquired a 35% ownership interest in Alloy Steel Australia (Int) Pty Ltd. (“Alloy Steel”), a privately held manufacturer of maintenance and repair solutions headquartered in Perth, Australia. On August 1, 2025, the Company acquired the remaining 65% ownership interest in Alloy Steel. In total, the Company acquired 100% ownership of Alloy Steel for a total purchase price of $130,060, net of cash acquired and certain debt-like items. Alloy Steel supplies proprietary technology, engineering services and digital monitoring to the mining sector.

During the three months ended March 31, 2026 and 2025, the Company recognized acquisition costs of $356 and $802, respectively, which are included in Selling, general & administrative expenses on the Consolidated Statements of Income and are expensed as incurred.

NOTE 5 — SEGMENT INFORMATION

The Company is a high-performance industrial machinery and technology leader who helps customers manufacture and maintain vital equipment and infrastructure. The Company’s innovative solutions enable higher quality and productivity across a variety of processes including welding, cutting, brazing, machining, process automation, and field repair.

The Company’s products include arc welding equipment, filler metals (welding, brazing and soldering consumables),cutting systems (laser, plasma and oxyfuel), wire feeding systems, fume control equipment, welding accessories, specialty gas regulators, mobile power equipment, wear solutions, software, and education solutions; as well as a comprehensive portfolio of automated solutions and system integration services for joining, cutting, material

10

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LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

handling, module assembly, and end of line testing. Services include additive manufacturing, precision fabrication, wear services, upfitting, and training.

The Company has aligned its organizational and leadership structure into three operating segments to support growth strategies and enhance the utilization of the Company’s worldwide resources and global sourcing initiatives. The operating segments consist of Americas Welding, International Welding and The Harris Products Group. The Americas Welding segment includes welding operations in North and South America. The International Welding segment includes welding operations in Europe, Africa, Asia and Australia. The Harris Products Group includes the Company’s global cutting, soldering and brazing businesses, specialty gas equipment, as well as its retail business in the United States.

Segment performance is measured and resources are allocated based on a number of factors, the primary measure being the adjusted earnings before interest and income taxes ("Adjusted EBIT") profit measure. Adjusted EBIT is defined as Operating income plus Other income (expense), adjusted for special items as determined by management such as the impact of rationalization activities, certain asset impairment charges and gains or losses on disposals of assets.

The Company’s chief operating decision maker (“CODM”) is the Chief Executive Officer. The CODM uses segment Adjusted EBIT to allocate resources for each segment predominantly in establishing the Company’s long-term strategy and in developing the annual budget. The CODM considers actual performance using Adjusted EBIT when making decisions about allocating capital and resources to the segments.

11

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

The following tables present Adjusted EBIT by segment and other segment information:

The Harris

Americas

International

Products

  ​ ​ ​

Welding

  ​ ​ ​

Welding

  ​ ​ ​

Group

  ​ ​ ​

Total

Three Months Ended March 31, 2026

 

 

  ​

Net sales

$

706,225

$

227,035

$

188,174

$

1,121,434

Inter-segment sales

 

36,709

 

5,807

 

4,664

47,180

742,934

232,842

192,838

1,168,614

Reconciliation to Consolidated Net sales

Elimination of inter-segment sales

(47,180)

Net sales

$

1,121,434

Cost of goods sold

464,890

167,084

137,600

Other segment expenses (1) (3)

151,149

44,868

14,247

Addback: Special items (charges) gain (1)

 

(573)

 

(1,772)

 

182

Segment Adjusted EBIT

$

127,468

$

22,662

$

40,809

$

190,939

Other Segment Information

Capital expenditures

$

(26,983)

$

(9,315)

$

(2,865)

$

(39,163)

Depreciation and amortization

17,774

6,682

2,649

27,105

Three Months Ended March 31, 2025

 

 

  ​

Net sales

$

653,107

$

219,061

$

132,220

$

1,004,388

Inter-segment sales

 

30,372

 

6,832

 

3,984

41,188

683,479

225,893

136,204

1,045,576

Reconciliation to Consolidated Net sales

Elimination of inter-segment sales

(41,188)

Net sales

$

1,004,388

Cost of goods sold

417,700

163,442

97,974

Other segment expenses (2) (3)

143,716

40,851

14,079

Addback: Special items charge (2)

 

(2,135)

 

(1,412)

 

(178)

Segment Adjusted EBIT

$

124,198

$

23,012

$

24,329

$

171,539

Other Segment Information

Capital expenditures

$

(21,766)

$

(3,608)

$

(1,575)

$

(26,949)

Depreciation and amortization

16,114

5,378

2,663

24,155

(1)In the three months ended March 31, 2026, special items within Other Segment expenses primarily include Rationalization and asset impairment net charges of $573 in Americas Welding, $1,772 in International Welding, and a net gain of $182 in The Harris Products Group, as discussed in Note 6.
(2)In the three months ended March 31, 2025, special items within Other Segment expenses primarily include Rationalization and asset impairment net charges of $2,135, $1,552, and $178 in Americas Welding, International Welding, and The Harris Products Group, respectively, as discussed in Note 6.
(3)Other segment expenses primarily include:
a.Selling, general & administrative expenses – including bonus and research and development expenses.
b.Rationalization and asset impairment net charges – refer to Note 6 for further discussion.

12

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

The following table presents reconciliations of segment information to the Company’s consolidated totals:

Three Months Ended March 31, 

2026

2025

Reconciliation of Segment Adjusted EBIT to Consolidated Income before income taxes

Segment Adjusted EBIT

$

190,939

$

171,539

Addback: Segment special items charge

(2,163)

(3,725)

Corporate special items charge (1)

(653)

(802)

Elimination of inter-segment loss (profit)

92

(1,012)

Unallocated corporate expenses, net

(1,487)

(638)

Interest income

 

1,385

 

2,255

Interest expense

 

(14,759)

 

(14,382)

Consolidated Income before income taxes

$

173,354

$

153,235

Reconciliation of Other Segment Information to Consolidated Information

Capital expenditures

Segment totals

$

(39,163)

$

(26,949)

Adjustments

Consolidated totals

$

(39,163)

$

(26,949)

Depreciation and amortization

Segment totals

$

27,105

$

24,155

Adjustments

(1,096)

(371)

Consolidated totals

$

26,009

$

23,784

(1) Corporate special items primarily include transaction costs.

March 31, 2026

December 31, 2025

Reconciliation of Segment Assets to Consolidated Assets

Americas Welding

$

2,524,416

$

2,464,376

International Welding

1,233,435

1,244,117

The Harris Products Group

494,690

431,259

Total Segment Assets

4,252,541

4,139,752

Corporate Assets

36,588

41,033

LIFO reserve not allocated to segments

(139,427)

(138,589)

Eliminations

(249,307)

(264,619)

Total Consolidated Assets

$

3,900,395

$

3,777,577

NOTE 6 — RATIONALIZATION AND ASSET IMPAIRMENTS

The Company has rationalization plans within all three of its reportable segments. The plans impacted headcount and included the consolidation of manufacturing facilities to better align with the cost structure, economic conditions and operating needs of the business.

The following table presents Rationalization and asset impairment net charges by segment:

  ​ ​ ​

Three Months Ended March 31, 

2026

2025

Americas Welding

$

573

$

2,135

International Welding

 

1,772

 

1,552

The Harris Products Group

 

(182)

 

178

Total

$

2,163

$

3,865

At March 31, 2026 and December 31, 2025, rationalization liabilities of $4,140 and $7,085, respectively, were recognized in Other current liabilities in the Company’s Condensed Consolidated Balance Sheet. The Company does not anticipate significant additional charges related to the completion of these plans.

13

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

The Company believes the rationalization actions will positively impact future results of operations and will not have a material effect on liquidity and sources and uses of capital. The Company continues to evaluate its cost structure and additional rationalization actions may result in charges in future periods.

The following table summarizes the activity related to rationalization liabilities for the three months ended March 31, 2026:

  ​ ​ ​

Americas

International

  ​ ​ ​

The Harris Products

  ​ ​ ​

Welding

Welding

  ​ ​ ​

Group

  ​ ​ ​

Consolidated

Balance at December 31, 2025

$

944

$

5,713

$

428

$

7,085

Payments and other adjustments

 

(1,030)

 

(4,048)

 

(30)

 

(5,108)

Charged to expense

 

573

 

1,772

 

(182)

 

2,163

Balance at March 31, 2026

$

487

$

3,437

$

216

$

4,140

NOTE 7 – ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) ("AOCI")

The following tables set forth the total changes in AOCI by component, net of taxes:

Three Months Ended March 31, 2026

Unrealized gain

(loss) on derivatives

designated and

Defined benefit

Currency

qualifying as cash

pension plan

translation

flow hedges

activity

adjustment

Total

Balance at December 31, 2025

$

17,687

$

(1,062)

$

(222,556)

$

(205,931)

Other comprehensive income (loss) before reclassification

 

1,079

(6,459)

(5,380)

Amounts reclassified from AOCI

 

(2,402)

(56)

(2,458)

Net current-period other comprehensive loss

 

(1,323)

 

(56)

 

(6,459)

 

(7,838)

Balance at March 31, 2026

$

16,364

$

(1,118)

$

(229,015)

$

(213,769)

Three Months Ended March 31, 2025

Unrealized gain

(loss) on derivatives

designated and

Defined benefit

Currency

qualifying as cash

pension plan

translation

flow hedges

activity

adjustment

Total

Balance at December 31, 2024

$

17,255

$

(1,048)

$

(316,342)

$

(300,135)

Other comprehensive income before reclassification

 

1,148

29,679

 

30,827

Amounts reclassified from AOCI

 

(319)

(1,285)

 

(1,604)

Net current-period other comprehensive income (loss)

 

829

 

(1,285)

 

29,679

 

29,223

Balance at March 31, 2025

$

18,084

$

(2,333)

$

(286,663)

$

(270,912)

14

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

NOTE 8 — INVENTORIES

Inventories in the Condensed Consolidated Balance Sheets are comprised of the following components:

  ​ ​ ​

  ​ ​ ​

March 31, 2026

  ​ ​ ​

December 31, 2025

Raw materials

$

155,206

$

164,440

Work-in-process

 

157,943

 

124,351

Finished goods

 

380,789

 

344,573

Total

$

693,938

$

633,364

At both March 31, 2026 and December 31, 2025, approximately 38% of total inventories were valued using the last-in, first-out ("LIFO") method. The excess of current cost over LIFO cost was $139,427 and $138,589 at March 31, 2026 and December 31, 2025, respectively.

NOTE 9 — LEASES

The table below summarizes the right-of-use assets and lease liabilities in the Company’s Condensed Consolidated Balance sheets:

Operating Leases

  ​ ​ ​

Balance Sheet Classification

  ​ ​ ​

March 31, 2026

  ​ ​ ​

December 31, 2025

Right-of-use assets

 

Other assets

$

50,887

$

52,989

Current liabilities

 

Other current liabilities

$

13,205

$

13,460

Noncurrent liabilities

 

Other liabilities

 

37,996

 

40,061

Total lease liabilities

 

  ​

$

51,201

$

53,521

The total future minimum lease payments for noncancelable operating leases were as follows:

  ​ ​ ​

March 31, 2026

2026

$

15,376

2027

 

12,639

2028

 

10,612

2029

 

7,739

2030

 

4,076

After 2030

 

10,597

Total lease payments

$

61,039

Less: Imputed interest

 

9,838

Operating lease liabilities

$

51,201

15

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

Other information related to leases was as follows:

Three Months Ended March 31, 

  ​ ​ ​

2026

2025

Lease expense (1)

$

6,624

$

5,890

Cash paid for amounts included in the measurement of lease liabilities (2)

4,671

2,552

Right-of-use assets obtained in exchange for operating lease liabilities

1,516

254

Weighted average discount rate

3.7

%

3.7

%

Weighted average remaining lease term

6.0 years

6.3 years

(1)Amounts are included in Costs of goods sold and Selling, general and administrative expenses in the Company’s Consolidated Statement of Income.
(2)Amounts are included in Net Cash Provided by Operating Activities in the Company’s Consolidated Statement of Cash Flows.

NOTE 10 — DEBT

At March 31, 2026 and December 31, 2025, debt consisted of the following:

  ​ ​ ​

  ​ ​ ​

  ​ ​ ​

March 31, 2026

  ​ ​ ​

December 31, 2025

Long-term debt

 

Interest Rate

 

 

  ​

 

  ​

Senior Unsecured Notes

2015 Notes - Series B due August 20, 2030

3.35

%

$

100,000

$

100,000

2015 Notes - Series C due April 1, 2035

3.61

%

50,000

50,000

2015 Notes - Series D due April 1, 2045

4.02

%

100,000

100,000

2016 Notes - Series A due October 20, 2028

2.75

%

100,000

100,000

2016 Notes - Series B due October 20, 2033

3.03

%

100,000

100,000

2016 Notes - Series C due October 20, 2037

3.27

%

100,000

100,000

2016 Notes - Series D due October 20, 2041

3.52

%

50,000

50,000

2024 Notes - Series A due August 22, 2029

5.55

%

75,000

75,000

2024 Notes - Series B due August 22, 2031

5.62

%

75,000

75,000

2024 Notes - Series C due June 20, 2034

5.74

%

400,000

400,000

Other borrowings due through 2030

Variable(1)

 

 

10

 

1,150,000

 

1,150,010

Plus interest rate swap adjustment

2,508

2,678

Less current portion

 

 

Less debt issuance costs

2,370

2,460

Long-term debt, less current portion

 

1,150,138

 

1,150,228

Short-term debt

 

 

Amounts due to banks

Variable(2)

 

163,502

 

143,780

Current portion long-term debt

 

 

Total short-term debt

 

163,502

 

143,780

Total debt

$

1,313,640

$

1,294,008

(1)Interest rate was 7.97% at December 31, 2025.
(2)Weighted average interest rate on the revolving credit facility was 4.7% as of both March 31, 2026 and December 31, 2025. Weighted average interest rate of other lines of credit related to liquidity needs in a hyperinflationary country was 41.6% as of December 31, 2025.

16

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

Senior Unsecured Notes

As of March 31, 2026, the Company’s total weighted average effective interest rate and remaining weighted average tenure of the senior unsecured notes is 4.16%, including the impact from terminated swap agreements, and 8.4 years, respectively. The senior unsecured notes contain certain affirmative and negative covenants. As of March 31, 2026, the Company was in compliance with all of its debt covenants relating to the senior unsecured notes.

Revolving Credit Agreements

On June 20, 2024, the Company entered into a $1 billion revolving credit facility, which may be increased, subject to certain conditions including the consent of its lenders, by an additional amount up to $300,000. The revolving credit facility matures on June 20, 2029. The revolving credit facility will initially bear interest on outstanding borrowings at a per annum rate equal to secured overnight finance rate (“SOFR”) plus 1.10% and could fluctuate based on the Company’s total net leverage ratio at a spread ranging from SOFR plus 1.10% to SOFR plus 1.60%. The financial covenants consist of a maximum net leverage ratio of 3.5x EBITDA and a minimum interest coverage ratio of 2.5x EBITDA. The revolving credit facility contains customary representations and warranties, as well as customary affirmative, negative and financial covenants for credit facilities of this type (subject to negotiated baskets and exceptions), including limitations on the Company and its subsidiaries with respect to liens, investments, distributions, mergers and acquisitions, dispositions of assets and transactions with affiliates. As of March 31, 2026, the Company was in compliance with all of its covenants. The Company had borrowings under the revolving credit facility of $163,502 as of March 31, 2026.

The Company has other lines of credit and debt agreements totaling $24,982. As of March 31, 2026, the Company was in compliance with all of its covenants and had no outstanding debt under short-term lines of credit.

Fair Value of Debt

At March 31, 2026 and December 31, 2025, the fair value of long-term debt, including the current portion, was approximately $1,075,384 and $1,125,338, respectively. The approximate fair value of the Company’s long-term debt, including current maturities, was based on a valuation model using Level 2 observable inputs using available market information and methodologies requiring judgment. The carrying value of this debt at such dates was $1,150,138 and $1,150,232, respectively. Since judgment is required in interpreting market information, the fair value of the debt is not necessarily the amount which could be realized in a current market exchange.

NOTE 11 — INCOME TAXES

The Company recognized $36,972 of tax expense on pre-tax income of $173,354, resulting in an effective income tax rate of 21.3% for the three months ended March 31, 2026. The effective income tax rate was 22.7% for the three months ended March 31, 2025. The effective tax rate was lower for the three months ended March 31, 2026, as compared with the same period in 2025, primarily due to the mix of earnings and timing of discrete tax items.

NOTE 12 — DERIVATIVES

The Company uses derivative instruments to manage exposures to currency exchange rates, interest rates and commodity prices arising in the normal course of business. Both at inception and on an ongoing basis, the derivative instruments that qualify for hedge accounting are assessed as to their effectiveness, when applicable. Hedge ineffectiveness was immaterial in the three months ended March 31, 2026 and 2025.

The Company is subject to the credit risk of the counterparties to derivative instruments. Counterparties include a number of major banks and financial institutions. None of the concentrations of risk with any individual counterparty

17

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

was considered significant at March 31, 2026. The Company does not expect any counterparties to fail to meet their obligations.

Cash Flow Hedges

Certain foreign currency forward contracts are qualified and designated as cash flow hedges. The dollar equivalent gross notional amount of these short-term contracts was $76,794 and $88,555 at March 31, 2026 and December 31, 2025, respectively.

Net Investment Hedges

The Company has foreign currency forward contracts and zero-cost collar contracts that qualify and are designated as net investment hedges. The dollar equivalent gross notional amount of the foreign currency forward contracts and zero-cost collar contracts were $269,566 and $337,659 at March 31, 2026 and December 31, 2025, respectively.

Derivatives Not Designated as Hedging Instruments

The Company has certain foreign exchange forward contracts that are not designated as hedges. These derivatives are held as economic hedges of certain balance sheet exposures. The dollar equivalent gross notional amount of these contracts was $409,689 and $370,668 at March 31, 2026 and December 31, 2025, respectively.

Fair values of derivative instruments in the Company’s Condensed Consolidated Balance Sheets consisted of the following:

March 31, 2026

December 31, 2025

Other

Other

Other

Other

Current

Current

Other

Other

Current

Current

Other

Other

Derivatives by hedge designation

Assets

  ​ ​ ​

Liabilities

  ​ ​ ​

Assets

  ​ ​ ​

Liabilities

  ​ ​ ​

Assets

  ​ ​ ​

Liabilities

  ​ ​ ​

Assets

  ​ ​ ​

Liabilities

Designated as hedging instruments:

  ​

 

  ​

 

  ​

 

  ​

 

  ​

 

  ​

 

  ​

 

  ​

Foreign exchange contracts

$

1,507

$

482

$

$

$

2,149

$

289

$

$

Net investment contracts

3,784

1,255

102

12,529

Not designated as hedging instruments:

 

Foreign exchange contracts

 

1,419

1,587

 

582

 

470

 

 

Total derivatives

$

6,710

$

3,324

$

$

$

2,833

$

13,288

$

$

The effects of undesignated derivative instruments on the Company’s Consolidated Statements of Income consisted of the following:

Three Months Ended March 31, 

Derivatives by hedge designation

  ​ ​ ​

Classification of (loss) gain

  ​ ​ ​

2026

  ​ ​ ​

2025

Not designated as hedges:

  ​

  ​

 

  ​

Foreign exchange contracts

Selling, general & administrative expenses

$

(3,353)

$

8,333

18

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

The effects of designated hedges on AOCI consisted of the following:

  ​ ​ ​

Total gain (loss) recognized in AOCI, net of tax

  ​ ​ ​

March 31, 2026

  ​ ​ ​

December 31, 2025

Foreign exchange contracts

$

642

$

1,396

Forward starting swap agreements

15,722

16,291

Net investment contracts

(4,179)

 

(5,721)

The Company expects a gain of $642 related to existing contracts to be reclassified from AOCI, net of tax, to earnings over the next 12 months as the hedged transactions are realized.

The effects of designated hedges on the Company’s Consolidated Statements of Income consisted of the following:

Gain (loss) recognized in the

Three Months Ended March 31, 

Derivative type

  ​ ​ ​

Consolidated Statements of Income:

  ​ ​ ​

2026

  ​ ​ ​

2025

Foreign exchange contracts

 

Sales

$

1,472

$

(713)

 

Cost of goods sold

 

1,560

 

361

Forward starting swap agreements

Interest expense, net

689

689

NOTE 13 — FAIR VALUE

The following table provides a summary of assets and liabilities as of March 31, 2026, measured at fair value on a recurring basis:

  ​ ​ ​

  ​ ​ ​

Quoted Prices in

  ​ ​ ​

  ​ ​ ​

Active Markets for

Identical Assets or

Significant Other

Significant

Balance as of

Liabilities

Observable Inputs

Unobservable

Description

  ​ ​ ​

March 31, 2026

  ​ ​ ​

(Level 1)

  ​ ​ ​

(Level 2)

  ​ ​ ​

Inputs (Level 3)

Assets:

 

  ​

 

  ​

 

  ​

 

  ​

Foreign exchange contracts

$

2,926

$

$

2,926

$

Net investment contracts

3,784

3,784

Pension surplus

9,314

9,314

Total assets

$

16,024

$

9,314

$

6,710

$

Liabilities:

 

  ​

 

  ​

 

  ​

 

  ​

Foreign exchange contracts

$

2,069

$

$

2,069

$

Net investment contracts

1,255

1,255

Deferred compensation

 

27,867

 

 

27,867

 

Total liabilities

$

31,191

$

$

31,191

$

19

Table of Contents

LINCOLN ELECTRIC HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dollars in thousands, except per share amounts

The following table provides a summary of assets and liabilities as of December 31, 2025, measured at fair value on a recurring basis:

  ​ ​ ​

  ​ ​ ​

Quoted Prices in

  ​ ​ ​

  ​ ​ ​

Active Markets for

Identical Assets or

Significant Other

Significant

Balance as of

Liabilities

Observable Inputs

Unobservable

Description

  ​ ​ ​

December 31, 2025

  ​ ​ ​

(Level 1)

  ​ ​ ​

(Level 2)

  ​ ​ ​

Inputs (Level 3)

Assets:

 

  ​

 

  ​

 

  ​

 

  ​

Foreign exchange contracts

$

2,731

$

$

2,731

$

Net investment contracts

102

102

Pension surplus

 

12,082

 

12,082

 

 

Total assets

$

14,915

$

12,082

$

2,833

$

Liabilities:

 

  ​

 

  ​

 

  ​

 

  ​

Foreign exchange contracts

$

759

$

$

759

$

Net investment contracts

 

12,529

 

 

12,529

 

Deferred compensation

 

24,456

 

 

24,456

 

Total liabilities

$

37,744

$

$

37,744

$

The fair value of the Company’s pension surplus assets are based on quoted market prices in active markets and are included in the Level 1 fair value hierarchy. The pension surplus assets were invested in money market and short-term duration bond funds at both March 31, 2026 and December 31, 2025.

The Company’s derivative contracts are valued at fair value using the market approach. The Company measures the fair value of foreign exchange contracts and net investment contracts using Level 2 inputs based on observable spot and forward rates in active markets.

The deferred compensation liability is the Company’s obligation under its executive deferred compensation plan. The Company measures the fair value of the liability using the market values of the participants’ underlying investment fund elections.

The fair value of Cash and cash equivalents, Accounts receivable, Short-term debt excluding the current portion of Long-term debt and Trade accounts payable approximated book value due to the short-term nature of these instruments at both March 31, 2026 and December 31, 2025.

The Company has various financial instruments, including cash and cash equivalents, short and long-term debt and forward contracts. While these financial instruments are subject to concentrations of credit risk, the Company has minimized this risk by entering into arrangements with a number of major banks and financial institutions and investing in several high-quality instruments. The Company does not expect any counterparties to fail to meet their obligations.

NOTE 14 SUPPLIER FINANCING PROGRAM

The Company’s suppliers, at the supplier’s sole discretion, are able to factor receivables due from the Company to a financial institution on terms directly negotiated with the financial institution without affecting the Company’s balance sheet classification of the corresponding payable. The Company pays the financial institution the stated amount of the confirmed invoices from its designated suppliers on the original maturity dates of the invoices. At March 31, 2026 and December 31, 2025, Trade accounts payable included $28,639 and $25,709, respectively, payable to suppliers that have elected to participate in the supplier financing program.

(1)

20

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Dollars in thousands, except per share amounts)

This Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read together with the Company’s unaudited consolidated financial statements and other financial information included elsewhere in this Quarterly Report on Form 10-Q.

General

The Company is a high-performance industrial machinery and technology leader who helps customers manufacture and maintain vital equipment and infrastructure. The Company’s innovative solutions enable higher quality and productivity across a variety of processes including welding, cutting, brazing, machining, process automation, and field repair.

The Company’s products include arc welding equipment, filler metals (welding, brazing and soldering consumables), cutting systems (laser, plasma and oxyfuel), wire feeding systems, fume control equipment, welding accessories, specialty gas regulators, mobile power equipment, wear solutions, software, and education solutions; as well as a comprehensive portfolio of automated solutions and system integration services for joining, cutting, material handling, module assembly, and end of line testing. Services include additive manufacturing, precision fabrication, wear services, upfitting, and training.

Solutions range in technology and features from basic units used for personal, maintenance and light manufacturing use to highly sophisticated robotic solutions for complex fabrication and production activities.

The Company’s business units are aligned into three operating segments. The operating segments consist of Americas Welding, International Welding and The Harris Products Group. The Americas Welding segment includes welding operations in North and South America. The International Welding segment includes welding operations in Europe, Africa, Asia and Australia. The Harris Products Group includes the Company’s global cutting, soldering and brazing businesses, specialty gas equipment, as well as the retail business which is primarily in the United States.

21

Results of Operations

The following table shows the Company’s results of operations:

Three Months Ended March 31, 

 

Favorable  (Unfavorable) 

 

2026

2025

2026 vs. 2025

Amount

  ​ ​ ​

% of Sales

  ​ ​ ​

Amount

  ​ ​ ​

% of Sales

  ​ ​ ​

$

  ​ ​ ​

%

 

Net sales

$

1,121,434

$

1,004,388

 

$

117,046

 

11.7

%

Cost of goods sold

 

722,302

 

638,940

 

  ​

(83,362)

 

(13.0)

%

Gross profit

 

399,132

35.6

%

 

365,448

 

36.4

%

 

33,684

 

9.2

%

Selling, general & administrative expenses

 

210,811

18.8

%

 

196,665

 

19.6

%

 

(14,146)

 

(7.2)

%

Rationalization and asset impairment net charges

 

2,163

0.2

%

 

3,865

 

0.4

%

  ​

1,702

 

44.0

%

Operating income

 

186,158

16.6

%

 

164,918

 

16.4

%

 

21,240

 

12.9

%

Interest expense, net

 

13,374

 

12,127

 

 

(1,247)

 

(10.3)

%

Other income

 

570

 

444

 

  ​

126

 

28.4

%

Income before income taxes

 

173,354

15.5

%

 

153,235

 

15.3

%

 

20,119

 

13.1

%

Income taxes

 

36,972

 

34,748

 

 

(2,224)

 

(6.4)

%

Effective tax rate

 

21.3

%  

 

22.7

%  

  ​

1.4

%  

Net income

$

136,382

12.2

%

$

118,487

 

11.8

%

$

17,895

 

15.1

%

Diluted earnings per share

$

2.47

$

2.10

 

  ​

$

0.37

 

17.6

%

Net Sales:

The following table summarizes the impact of volume, acquisitions, price and foreign currency exchange rates on Net sales on a consolidated basis:

Three Months Ended March 31, 

  ​ ​ ​

  ​ ​ ​

Change in Net Sales due to:

  ​ ​ ​

 

Net Sales

Foreign

Net Sales

  ​ ​ ​

2025

  ​ ​ ​

Volume

  ​ ​ ​

Price

  ​ ​ ​

Acquisitions

  ​ ​ ​

Exchange

  ​ ​ ​

2026

 

Lincoln Electric Holdings, Inc.

$

1,004,388

$

(25,641)

$

104,558

$

15,794

 

$

22,335

$

1,121,434

% Change

 

  ​

 

  ​

 

  ​

 

  ​

 

  ​

Lincoln Electric Holdings, Inc.

 

(2.6)

%

 

10.4

%  

 

1.6

%

2.3

%

11.7

%

Net sales increased for the three months ended March 31, 2026 due to an increase in organic sales and a benefit from acquisitions and foreign exchange. The increase in organic sales for the three months ended March 31, 2026 is driven by an increase in pricing primarily due to higher input costs, partially offset by lower volumes.

Gross Profit:

Gross profit as a percentage of sales decreased 0.8% for the three months ended March 31, 2026 as compared to the same 2025 period, driven by an unfavorable impacts from volumes and product mix. The three months ended March 31, 2026 and 2025 includes last-in, first-out (“LIFO”) charges of $838 and $1,761, respectively, which was primarily due to rising input costs.

Selling, General & Administrative Expenses:

Selling, general & administrative expenses increased in the three months ended March 31, 2026 as compared to the same 2025 period, primarily due to increases in discretionary spend, employee costs and the unfavorable impact of foreign currency translation. Selling, general & administrative expenses as a percentage of sales decreased primarily due to higher organic sales.

22

Operating Income:

Operating income as a percentage of sales was 16.6% for the three months ended March 31, 2026 as compared to 16.4% in the prior year period. Excluding special items, Operating income as a percentage of sales was 16.9% for both the three months ended March 31, 2026 and 2025. Refer to explanations above for additional details. Also refer to Non-GAAP Financial Measures for a reconciliation of Adjusted operating income.

Income Taxes:

The effective tax rate was lower for the three months ended March 31, 2026 as compared to the same 2025 period, primarily due to the mix of earnings and timing of discrete tax items.

Segment Results

The following table presents components of Net sales by segment:

Three Months Ended March 31, 

Change in Net Sales due to:

Net Sales

  ​ ​ ​

Foreign

  ​ ​ ​

Net Sales

 

2025

Volume (1)

  ​

Price (2)

  ​

Acquisitions (3)

  ​

Exchange (4)

2026

Operating Segments

Americas Welding

$

653,107

$

(2,635)

$

49,479

$

 

$

6,274

$

706,225

International Welding

219,061

 

(21,631)

 

297

 

15,794

 

13,514

 

227,035

The Harris Products Group

132,220

 

(1,375)

 

54,782

 

 

2,547

 

188,174

% Change

  ​

 

  ​

 

  ​

 

  ​

 

  ​

 

  ​

Americas Welding

(0.4)

%

 

7.6

%

0.9

%

8.1

%

International Welding

(9.9)

%

 

0.1

%

7.2

%

6.2

%

3.6

%

The Harris Products Group

(1.0)

%

 

41.4

%

1.9

%

42.3

%

(1)Decrease for the three months ended March 31, 2026 in International Welding is primarily related to lower project volumes within the Automation product line and the Middle East conflict.
(2)Increase in Americas Welding and The Harris Products Group due to price actions taken in response to higher input costs.
(3)Increase in International Welding due to the acquisition discussed in Note 4 to the consolidated financial statements.
(4)Increase for the three months ended March 31, 2026 for all three segments relates to the weaker U.S. dollar.

Segment performance is measured and resources are allocated based on a number of factors, the primary measure being the Adjusted EBIT profit measure. Adjusted EBIT is defined as Operating income plus Other income, adjusted for special items as determined by management such as the impact of rationalization activities, certain asset impairment charges and gains or losses on disposals of assets.

23

The following table presents Adjusted EBIT by segment:

  ​ ​ ​

  ​ ​ ​

Favorable 

 

(Unfavorable) 

 

March 31, 

2026 vs. 2025

 

  ​ ​ ​

2026

2025

$

%

Americas Welding:

 

 

  ​

 

  ​

  ​

Net sales

$

706,225

$

653,107

$

53,118

8.1

%

Inter-segment sales

36,709

 

30,372

 

6,337

20.9

%

Total Sales

$

742,934

$

683,479

$

59,455

8.7

%

Adjusted EBIT (1) (4)

$

127,468

$

124,198

$

3,270

2.6

%

As a percent of total sales (1)

17.2

%  

 

18.2

%  

 

(1.0)

%

International Welding:

 

 

  ​

  ​

Net sales

$

227,035

$

219,061

$

7,974

3.6

%

Inter-segment sales

5,807

 

6,832

 

(1,025)

(15.0)

%

Total Sales

$

232,842

$

225,893

$

6,949

3.1

%

Adjusted EBIT (2) (5)

$

22,662

$

23,012

$

(350)

(1.5)

%

As a percent of total sales (2)

9.7

%  

 

10.2

%  

 

(0.5)

%

The Harris Products Group:

 

 

  ​

  ​

Net sales

$

188,174

$

132,220

$

55,954

42.3

%

Inter-segment sales

4,664

 

3,984

 

680

17.1

%

Total Sales

$

192,838

$

136,204

$

56,634

41.6

%

Adjusted EBIT (3) (6)

$

40,809

$

24,329

$

16,480

67.7

%

As a percent of total sales (3)

21.2

%  

 

17.9

%  

 

3.3

%

Corporate / Eliminations:

 

 

  ​

  ​

Inter-segment sales

$

(47,180)

$

(41,188)

$

(5,992)

(14.5)

%

Adjusted EBIT (7)

(1,395)

 

(1,650)

 

255

15.5

%

Consolidated:

 

 

  ​

  ​

Net sales

$

1,121,434

$

1,004,388

$

117,046

11.7

%

Net income

$

136,382

$

118,487

$

17,895

15.1

%

As a percent of total sales

12.2

%  

 

11.8

%  

 

0.4

%

Adjusted EBIT (8)

$

189,544

$

169,889

$

19,655

11.6

%

As a percent of sales

16.9

%  

 

16.9

%  

 

%

(1)Adjusted EBIT increased for the three months ended March 31, 2026 as compared to March 31, 2025 driven by the favorable net impact of organic sales, partially offset by unfavorable impact of product mix; Adjusted EBIT as a percent of sales decreased for the same period due to the timing of pricing actions, higher employee costs and an increase in allocated corporate costs related to strategic initiatives.
(2)Adjusted EBIT and Adjusted EBIT as a percent of sales decreased for the three months ended March 31, 2026 as compared to March 31, 2025 primarily driven by the unfavorable impact of lower volumes and an increase in allocated corporate costs related to strategic initiatives, partially offset by the benefit of acquisitions.
(3)Adjusted EBIT and Adjusted EBIT as a percent of sales increased for the three months ended March 31, 2026 as compared to March 31, 2025 primarily driven by operating leverage from higher organic sales.
(4)The three months ended March 31, 2026 and 2025 exclude Rationalization and asset impairment net charges of $573 and $2,135, respectively, as discussed in Note 6 to the consolidated financial statements.
(5)The three months ended March 31, 2026 and 2025 exclude Rationalization and asset impairment net charges of $1,772 and $1,552, respectively, as discussed in Note 6 to the consolidated financial statements.

24

(6)The three months ended March 31, 2026 and 2025 exclude Rationalization and asset impairment net gains of $182 and net charges of $178, respectively, as discussed in Note 6 to the consolidated financial statements.
(7)The three months ended March 31, 2026 and 2025 exclude transaction costs of $653 and $802, respectively, as discussed in Note 4 to the consolidated financial statements.
(8)See non-GAAP Financial Measures for a reconciliation of Net income as reported and Adjusted EBIT.

Non-GAAP Financial Measures

The Company reviews Adjusted operating income, Adjusted net income, Adjusted EBIT, Adjusted effective tax rate, Adjusted diluted earnings per share, Adjusted return on invested capital (“Adjusted ROIC”), Adjusted net operating profit after taxes, Free cash flow, Cash conversion and Organic sales, all non-GAAP financial measures, in assessing and evaluating the Company’s underlying operating performance. These non-GAAP financial measures exclude the impact of special items on the Company’s reported financial results. Non-GAAP financial measures should be read in conjunction with the generally accepted accounting principles in the United States ("GAAP") financial measures, as non-GAAP measures are a supplement to, and not a replacement for, GAAP financial measures.

The following table presents the reconciliations of Operating income as reported to Adjusted operating income, Net income as reported to Adjusted net income and Adjusted EBIT, Effective tax rate as reported to Adjusted effective tax rate and Diluted earnings per share as reported to Adjusted diluted earnings per share:

Three Months Ended March 31, 

 

2026

  ​ ​ ​

2025

 

Operating income as reported

$

186,158

$

164,918

Special items (pre-tax):

 

  ​

 

  ​

Rationalization and asset impairment net charges (1)

 

2,163

 

3,865

Transaction costs (2)

 

653

 

802

Amortization of step up in value of acquired inventories (3)

 

 

(140)

Adjusted operating income

$

188,974

$

169,445

As a percentage of net sales

16.9

%

16.9

%

Net income as reported

$

136,382

$

118,487

Special items:

 

Rationalization and asset impairment net charges (1)

 

2,163

3,865

Transaction costs (2)

 

653

802

Amortization of step up in value of acquired inventories (3)

 

(140)

Tax effect of Special items (4)

 

(740)

(1,158)

Adjusted net income

138,458

121,856

Interest expense, net

 

13,374

12,127

Income taxes as reported

 

36,972

34,748

Tax effect of Special items (4)

 

740

1,158

Adjusted EBIT

$

189,544

$

169,889

Effective tax rate as reported

21.3

%  

22.7

%

Net special item tax impact

0.1

%  

0.1

%

Adjusted effective tax rate

21.4

%  

22.8

%

Diluted earnings per share as reported

$

2.47

$

2.10

Special items per share

 

0.03

0.06

Adjusted diluted earnings per share

$

2.50

$

2.16

(1)Primarily related to restructuring activities as discussed in Note 6 to the consolidated financial statements.

25

(2)Transaction costs primarily relate to acquisitions and are included in Selling, general & administrative expenses.
(3)Costs relate to acquisitions and are included in Cost of goods sold.
(4)Includes the net tax impact of Special items recorded during the respective periods. The tax effect of Special items impacting pre-tax income was calculated as the pre-tax amount multiplied by the applicable tax rate. The applicable tax rates reflect the taxable jurisdiction and nature of each Special item.

Liquidity and Capital Resources

Overview

The Company’s primary sources of liquidity are operating cash flows and revolving credit facilities. As of March 31, 2026, the Company had $298,903 of cash and cash equivalents on hand and $163,502 of outstanding borrowings under its $1,024,982 revolving credit facilities.

The Company’s capital allocation priorities include internal investment to support existing operations and organic growth, investment in acquisitions to grow the business and then returning capital to shareholders through dividends and share repurchases.

The Company’s cash flow from operations can be cyclical. In assessing liquidity, the Company reviews working capital measurements to define areas for improvement. Management anticipates the Company will be able to satisfy cash requirements for its ongoing businesses for the foreseeable future primarily with cash generated by operations, existing cash balances, borrowings under its existing credit facilities and raising debt in capital markets.

The Company continues to expand globally and periodically consider acquisitions that would involve significant investments. The Company can fund its global expansion plans with operational cash flow, but a significant acquisition may require access to capital markets, in particular, the long-term debt market, as well as the syndicated bank loan market. The Company’s financing strategy is to fund itself at the lowest after-tax cost of funding. Where possible, the Company utilizes operational cash flows and raises capital in the most efficient market, usually the United States, and then lends funds to the specific subsidiary needing or requiring funding. If additional acquisitions providing appropriate financial benefits become available, additional expenditures may be made.

Cash Flow

The following table reflects changes in key cash flow measures:

  ​ ​ ​

Three Months Ended March 31, 

  ​ ​ ​

2026

  ​ ​ ​

2025

  ​ ​ ​

$ Change

Cash provided by operating activities (1)

$

102,170

$

185,693

$

(83,523)

Cash used by investing activities

 

(38,715)

 

(22,303)

 

(16,412)

Capital expenditures

 

(39,163)

 

(26,949)

 

(12,214)

Cash used by financing activities

 

(72,569)

 

(144,488)

 

71,919

Proceeds from (payments on) short-term borrowings, net

 

19,613

 

(904)

 

20,517

Purchase of shares for treasury

 

(56,670)

 

(106,694)

 

50,024

Cash dividends paid to shareholders

 

(44,071)

 

(42,975)

 

(1,096)

(Decrease) increase in Cash and cash equivalents

 

(9,886)

 

17,443

 

(27,329)

(1)Cash provided by operating activities decreased for the three months ended March 31, 2026, compared with the three months ended March 31, 2025 primarily due to unfavorable working capital.

As of March 31, 2026, the Company had cash of $298,903, of which $281,612 was held by international subsidiaries.

In April 2026, the Company paid a cash dividend of $0.79 per share, or $43,282, to shareholders of record on March 31, 2026.

26

The Company currently anticipates capital expenditures of $110,000 to $130,000 in 2026. Anticipated capital expenditures include investments to increase capacity, improve operational effectiveness and for general maintenance. Management critically evaluates all proposed capital expenditures and expects each project to increase efficiency, reduce costs, support sales growth or improve the overall safety and environmental conditions of the Company’s facilities.

Revolving Credit Agreements

On June 20, 2024, the Company entered into a $1 billion revolving credit facility. The revolving credit facility matures on June 20, 2029. Additionally, the Company has other lines of credit with total availability of $24,982. As of March 31, 2026, the Company had total availability of $861,480 under its revolving credit facilities. Refer to Note 10 to the consolidated financial statements for further information on our revolving lines of credit.

Working Capital Ratios

March 31, 2026

  ​ ​ ​

December 31, 2025

 

March 31, 2025

 

Average operating working capital to Net sales (1) (2)

 

18.6

%  

17.9

%

17.8

%

Days sales in Inventories (2)

 

120.8

 

116.4

115.7

Days sales in Accounts receivable

 

51.2

 

49.4

50.5

Average days in Trade accounts payable

 

63.0

 

53.4

58.6

(1)Average operating working capital to net sales is defined as the sum of Accounts receivable, Inventories and contract assets less Trade accounts payable and contract liabilities as of period end divided by annualized rolling three months of Net sales.
(2)Due to the strategic increase of inventory to serve customers, the Company had higher inventories relative to expected Net sales resulting in higher Days sales in Inventories and Average operating working capital to Net sales.

Stock Repurchase Program

On February 12, 2020, the Company’s Board authorized a share repurchase program for up to 10 million shares of the Company’s common stock. As of March 31, 2026, there were 4.9 million shares available under the authorization. The Company is not obligated to make any repurchases.

Rationalization and Asset Impairments

Refer to Note 6 to the consolidated financial statements for a discussion of the Company’s rationalization plans. The Company believes the rationalization actions will positively impact future results of operations and will not have a material effect on liquidity and sources and uses of capital.

Acquisitions

Refer to Note 4 to the consolidated financial statements for a discussion of the Company’s recent acquisitions.

Return on Invested Capital

The Company reviews ROIC in assessing and evaluating the Company’s underlying operating performance. As discussed in the Non-GAAP Financial Measures section above, Adjusted ROIC is a non-GAAP financial measure that the Company believes is a meaningful metric to investors in evaluating the Company’s financial performance. The calculation may be different than the method used by other companies to calculate ROIC. Adjusted ROIC is defined as rolling 12 months of Adjusted net income excluding tax-effected interest income and expense divided by invested capital. Invested capital is defined as total debt, which includes Short-term debt and Long-term debt, less current portions, plus Total equity.

27

The following table presents the reconciliations of ROIC and Adjusted ROIC to net income:

\

Twelve Months Ended March 31, 

  ​ ​ ​

2026

  ​ ​ ​

2025

 

Net income as reported

$

538,428

 

$

461,180

Plus: Interest expense (after-tax)

44,044

41,450

Less: Interest income (after-tax)

4,459

6,868

Net operating profit after taxes

$

578,013

$

495,762

Special items:

Rationalization and asset impairment net charges

 

16,497

 

 

55,120

Transaction costs

 

2,590

 

 

6,085

 

Pension settlement net charges

 

719

 

 

3,792

Amortization of step up in value of acquired inventories

 

4,104

 

 

4,883

Loss on asset disposal

 

 

 

4,950

Tax effect of Special items (1)

 

5,595

 

 

(11,545)

Adjusted net operating profit after taxes

$

607,518

 

$

559,047

 

 

Invested Capital

  ​ ​ ​

March 31, 2026

  ​ ​ ​

March 31, 2025

Short-term debt

$

163,502

$

109,620

Long-term debt, less current portion

1,150,138

1,150,473

Total debt

1,313,640

1,260,093

Total equity

 

1,511,260

 

1,340,170

Invested capital

$

2,824,900

$

2,600,263

Return on invested capital as reported

 

20.5

%  

 

19.1

%

Adjusted return on invested capital

 

21.5

%  

 

21.5

%

(1)Includes the net tax impact of Special items recorded during the respective periods. The tax effect of Special items impacting pre-tax income was calculated as the pre-tax amount multiplied by the applicable tax rate. The applicable tax rates reflect the taxable jurisdiction and nature of each Special item.

New Accounting Pronouncements

Refer to Note 1 to the consolidated financial statements for a discussion of new accounting pronouncements.

Forward-looking Statements

The Company’s expectations and beliefs concerning the future contained in this report are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements reflect management’s current expectations and involve a number of risks and uncertainties. Forward-looking statements generally can be identified by the use of words such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “forecast,” “guidance” or words of similar meaning. Actual results may differ materially from such statements due to a variety of factors that could adversely affect the Company’s operating results. The factors include, but are not limited to: general economic, financial and market conditions; the effectiveness of commercial and operating initiatives; the effectiveness of information systems and cybersecurity systems; presence of artificial intelligence technologies; completion of planned divestitures; interest rates; disruptions, uncertainty or volatility in the credit markets that may limit our access to capital; currency exchange rates and devaluations; adverse outcome of pending or potential litigation; actual costs of the Company’s rationalization plans; possible acquisitions, including the Company’s ability to successfully integrate acquisitions; market risks and price fluctuations related to the purchase of commodities and energy; global regulatory complexity; the effects of changes in tax law; tariff rates in the countries where the Company conducts business; and the possible effects of events beyond our control, including but not limited to, the ongoing geopolitical conflicts, political unrest, acts of terror, natural disasters and pandemics on the Company or its customers, suppliers and the economy in

28

general. For additional discussion, see “Item 1A. Risk Factors” presented herein, as well as in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes in the Company’s exposure to market risk since December 31, 2025. See “Item 7A. Quantitative and Qualitative Disclosures About Market Risk” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company carried out an evaluation under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, the Company’s management, including the Chief Executive Officer and Chief Financial Officer, concluded that the Company’s disclosure controls and procedures were effective as of March 31, 2026.

Changes in Internal Control Over Financial Reporting

There have been no changes in the Company’s internal control over financial reporting that occurred during the quarter ended March 31, 2026 that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The Company is subject, from time to time, to a variety of civil and administrative proceedings arising out of its normal operations, including, without limitation, product liability claims, regulatory claims and health, safety and environmental claims. Among such proceedings are the cases described below.

As of March 31, 2026, the Company was a co-defendant in cases alleging asbestos induced illness involving claims by approximately 1,052 plaintiffs, which is a net decrease of 74 claims from those previously reported. In each instance, the Company is one of a large number of defendants. The asbestos claimants seek compensatory and punitive damages, in most cases for unspecified sums. Since January 1, 1995, the Company has been a co-defendant in asbestos cases that have been resolved as follows: 57,346 of those claims were dismissed, 23 were tried to defense verdicts, 7 were tried to plaintiff verdicts (which were reversed or resolved after appeal), 2 were resolved by agreement for an immaterial amount and 1,023 were decided in favor of the Company following summary judgment motions.

ITEM 1A. RISK FACTORS

In addition to the other information set forth in this Quarterly Report on Form 10-Q, the reader should carefully consider the factors discussed in “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

29

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer purchases of its common shares during the first quarter of 2026 were as follows:

Total Number of

  ​ ​ ​

  ​ ​ ​

  ​ ​ ​

Shares

  ​ ​ ​

Maximum Number

Repurchased

of Shares that May

Total Number of

as Part of Publicly

Yet be Purchased

Shares

Average Price

Announced Plans or

Under the Plans or

Period

Repurchased

Paid Per Share

Programs

Programs (2)

January 1 - 31, 2026

65,803

(1)

$

253.98

64,535

5,032,096

February 1 - 28, 2026

68,316

(1)

286.97

54,526

4,977,570

March 1 - 31, 2026

76,254

(1)

266.91

68,586

4,908,984

Total

 

210,373

111

$

269.38

 

187,647

 

  ​

(1)The above share repurchases include the surrender of the Company’s common shares in connection with the vesting of restricted awards.
(2)On February 12, 2020, the Company’s Board of Directors authorized a new share repurchase program for up to an additional 10 million shares of the Company’s common stock. Total shares purchased through the share repurchase programs were 5.1 million shares at a total cost of $968.7 million for a weighted average cost of $189.44 per share through March 31, 2026.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

During the quarter ended March 31, 2026, none of the Company’s directors or officers adopted, modified, or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408(a) of Regulation S-K.

30

ITEM 6. EXHIBITS

(a)Exhibits

10.1*

Form of Stock Option Agreement for Executive Officers for awards granted in 2026 (filed herewith).

10.2*

Form of Restricted Stock Unit Agreement for Executive Officers for awards granted in 2026 (filed herewith).

10.3*

Form of Performance Share Award Agreement for Executive Officers for awards granted in 2026 (filed herewith).

31.1

Certification of the Chairman and Chief Executive Officer (Principal Executive Officer) pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 (filed herewith).

31.2

Certification of the Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial and Accounting Officer) pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 (filed herewith).

32.1

Certification of the Chairman and Chief Executive Officer (Principal Executive Officer) and Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial and Accounting Officer) pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).

101.INS

Inline XBRL Instance Document

101.SCH

Inline XBRL Taxonomy Extension Schema Document

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document

104

Cover page Interactive Data File (formatted as Inline XBRL and contained in the Exhibit 101 attachments)

Inline XBRL Taxonomy Extension Label Linkbase Document

* Reflects management contract or other compensatory arrangement required to be filed as an exhibit pursuant to Item 15(b) of this report

31

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

  ​ ​ ​

LINCOLN ELECTRIC HOLDINGS, INC.

/s/ Gabriel Bruno

Gabriel Bruno

Executive Vice President, Chief Financial Officer and Treasurer

(Principal Financial and Accounting Officer)

April 30, 2026

32