AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 6/6 · 18/10/2026
Moat50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 2/4 · Qualification effort, technical assets and a substantial field-service network support a limited incumbent advantage. Direct evidence of customer lock-in or superiority over alternatives is missing.
durability · 2/4 · Lifecycle support and continuing engineering investment support persistence, but rapid architecture changes require continual renewal. Patent lives and sustained competitive outcomes are not disclosed.
customer dependency · 2/4 · Design qualification and lifecycle services imply dependency within deployments. Organic services growth provides indirect support, while order-reduction rights limit contractual lock-in.
erosion resilience · 2/4 · Pricing execution and investment show adaptation to cost and technology pressures. Technology shifts, customer leverage and actual supply congestion prevent a stronger resilience assessment.
Pricing power63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 3/4 · The filings report $470 million of price realization in 2023 and improved price realization in both 2024 and 2025. This is strong observed pricing evidence, although it does not isolate willingness to pay from inflation recovery.
retention · 2/4 · Organic services and spares growth of 12.8% in 2025, lifecycle support and qualification friction support continued engagement indirectly. No customer cohort or renewal evidence establishes how much demand came from existing customers.
margin resilience · 3/4 · Pricing actions more than offset commodity and logistics inflation in 2023; gross margin improved in 2024 and remained broadly stable in 2025 despite tariff inflation. Second-quarter 2026 improvement provides further operating support but was attributed primarily to mix, not pricing.
contractual freedom · 2/4 · Observed price realization demonstrates an ability to adjust prices across the business. Repricing reaches results slowly through backlog, while fixed-price contracts and customer bargaining power constrain flexibility; termination penalties provide only partial protection.
Predictability87
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 100.00
- Revenue growth volatility (pp)
- 5.18
- Positive FCF years (%)
- 80.00
- FCF margin volatility (pp)
- 8.28
Financial strength86
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 92.31
- netDebtEbitGrade
- 87.05
- interestCoverageGrade
- 100.00
- currentRatioGrade
- 63.79
- Debt / FCF (x)
- 1.54
- Net debt / operating income (x)
- 0.65
- Interest coverage (x)
- 21.25
- Current ratio (x)
- 1.55
Capital allocation98
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 30.94
- 3-year average dilution (%)
- 0.44
- 3-year average SBC / revenue (%)
- 0.41
- cashConversionGrade
- 100.00
Management56
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Multi-year cash generation supports increased capacity spending and acquisitions. First-half 2026 cash generation materially benefited from deferred revenue, acquisition returns remain unproven, debt financing continues and equity awards dilute holders. These actual outcomes support a mixed assessment.
incentive alignment · 2/4 · Actual annual incentives use operating profit and free cash flow, and the CEO received stock options with multi-year vesting features. Actual bonus payouts above 200% of target and dilution temper alignment. Ownership amounts and complete long-term performance conditions are missing.
execution · 3/4 · Growth in sales, GAAP operating profit, organic services demand and cash generation across multiple years demonstrates strong operating execution, continued into second-quarter 2026. Assessment uses operating evidence rather than leadership praise; favorable AI demand, acquisitions, working-capital benefits and supply congestion limit attribution to management.
governance · 2/4 · Independent standing committees, separate chairman and CEO roles, actual attendance and double-trigger severance provide substantive safeguards. Compensation discretion and a historical adverse licensing ruling temper the assessment. Current litigation allegations remain unresolved and do not establish misconduct; ownership and full shareholder-rights coverage are absent.
Evidence
A customer’s decision to purchase certain of our products or solutions, particularly products new to the market or long-term end-to-end solutions, may involve a lengthy contracting, design and qualification process.
Risk Factors / customer contracting, design and qualification · Filed 13/02/2026
We expanded our global footprint and scaled our services capabilities to over 5,000 field service engineers worldwide.
2025 performance / field service engineer network · Filed 24/04/2026
In addition, through our global services network, we provide lifecycle management services, predictive analytics and professional services for deploying, maintaining and optimizing these products and their related systems.
Business / lifecycle management services · Filed 13/02/2026
- 2026 Proxy Statement | 59 Table of Contents Reconciliation of Non-GAAP Financial Measures The following is a reconciliation of (i) adjusted operating profit (loss) to the comparable GAAP measure of operating profit (loss) and (ii) adjusted operating margin to the comparable GAAP measure of operating margin, in each case for the 12 months ended December 31, 2025, 2024 and 2023 (in millions): Full Year 2025 Full Year 2024 Full Year 2023 Net sales $ 10,229.9 $ 8,011.8 $ 6,863.2 Operating profit (loss) 1,829.7 1,367.4 872.2 Operating margin 17.9% 17.1% 12.7% Amortization of intangibles 200.4 184.2 181.3 Restructuring costs – global programs 49.5 — — Contingent consideration 4.9 — — Mergers and acquisition costs 5.2 — — Adjusted operating profit (loss) $ 2,089.7 $ 1,551.6 $ 1,053.5 Adjusted operating margin 20.4% 19.4% 15.3% Reconciliation of Net Cash Provided By (Used For) Operating Activities to Adjusted Free Cash Flow (In millions) Full Year 2025 Full Year 2024 Full Year 2023 Net cash provided by (used for) operating activities $ 2,113.8 $ 1,319.3 $ 900.5 Capital expenditures (220.0 ) (167.0 ) (127.9 ) Investments in capitalized software (6.4 ) (17.1 ) (6.7 ) Proceeds from disposition of PP&E — — 12.4 Adjusted Free Cash Flow $ 1,887.4 $ 1,135.2 $ 778.3 Reconciliation from Net Sales to Organic Net Sales Growth Full Year 2025 GAAP Sales Full Year 2024 GAAP Sales Δ Δ% Products $ 8,207.0 $ 6,245.2 $ 1,961.8 31.4% Services & spares 2,022.9 1,766.6 256.3 14.5% Total $ 10,229.9 $ 8,011.8 $ 2,218.1 27.7% Δ FX Δ Acquisition Δ(1) Organic Growth Organic Δ%(2) Products $ 1,961.8 $ (37.5 ) $ (41.4 ) $1,882.9 30.1% Services & spares 256.8 (12.1 ) $ (17.4 ) 226.8 12.8% Total $ 2,218.1 $ (49.6 ) $ (58.8 ) $2,109.7 26.3% (1) The change in acquisition sales includes sales for the year ended December 31, 2025, for acquisitions completed in the year ended December 31, 2025.
Annex A / 2023–2025 operating results, cash generation and organic services growth · Filed 24/04/2026
Our customers have the right in some circumstances, usually with penalties or other termination consequences, to reduce or defer firm orders in backlog.
Risk Factors / customer rights to reduce or defer firm orders · Filed 13/02/2026
These risk factors and those identified elsewhere in this Form 10-Q, among others, could cause actual results to differ materially from historical performance and include, but are not limited to: risks relating to the continued growth of our customers’ markets; long sales cycles for certain Vertiv products and solutions as well as unpredictable placing or cancelling of customer orders; failure to realize sales expected from our backlog of orders and contracts, disruption of or consolidation in our customer’s markets or categorical shifts in customer technology spending; less leverage with large customer contract terms; failure to mitigate risks associated with long-term fixed price contracts; competition in the industry in which we operate; failure to obtain performance and other guarantees from financial institutions; risks associated with governmental contracts; failure to properly manage production cost changes and supply chain; failure to anticipate market change and competition in the infrastructure technologies; risks associated with information technology disruption or cyber-security incidents; risks associated with the implementation and enhancement of information systems; failure to realize the expected benefit from any rationalization, restructuring and improvement efforts; disruption of, or changes in, Vertiv’s independent sales representatives, distributors and original equipment manufacturers; increase of variability in our effective tax rate costs or liabilities associated with product liability due to global operations subjecting us to income and other taxes in the United States ("U.S.") and numerous foreign entities; costs or liabilities associated with product liability and damage to our reputation and brands; the global scope of Vertiv’s operations, especially in emerging markets; failure to benefit from future significant corporate transactions; risks associated with Vertiv’s sales and operations and expanding global production facilities; risks associated with future legislation and regulation of Vertiv’s customers’ markets; our ability to comply with various laws and regulations including but not limited to, laws and regulations relating to data protection and data privacy; failure to properly address legal compliance issues, particularly those related to imports/exports, anti-corruption laws, and foreign operations; risks associated with foreign trade policy, including tariffs and global trade conflict; risks associated with litigation or claims
Risk disclosures / customer leverage, fixed-price contracts and competition · Filed 22/04/2026
Also, due to our large backlog, pricing changes may take longer to be reflected in our financial results.
Risk Factors / backlog delays reflection of pricing changes · Filed 13/02/2026
As of December 31, 2025 Vertiv had approximately 3,000 registered patents and approximately 1,900 pending, published or allowed patent applications, and approximately 1,900 registered trademarks and approximately 200 pending trademark applications.
Business / registered patents and pending applications · Filed 13/02/2026
(10) OTHER FINANCIAL INFORMATION Items reported in earnings include the following: Year Ended December 31, 2025 2024 2023 Engineering, research and development expense 441.7 $ 367.6 $ 303.5 Depreciation expense 97.1 81.6 74.3 Advertising expense 16.8 19.4 20.1 Items reported in accrued expenses and other liabilities include the following: December 31, 2025 December 31, 2024 Accrued payroll and other employee compensation $ 173.2 $ 147.8 Restructuring (see Note 4) 44.2 10.4 Operating lease liabilities (see Note 7) 69.7 45.7 Product warranty (see Note 1) 43.2 27.5 Other 441.3 381.2 Total $ 771.6 $ 612.6 86 Table of contents (11) FINANCIAL INSTRUMENTS AND RISK MANAGEMENT In accordance with ASC 820, the Company uses a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.
Note 10 / engineering, research and development spending · Filed 13/02/2026
18 Table of contents If we fail to anticipate technology shifts, market needs and opportunities, and fail to develop appropriate products, product enhancements and services in a timely manner, we may not be able to compete effectively and, as a result, our ability to generate revenues will suffer.
Risk Factors / failure to anticipate technology shifts · Filed 13/02/2026
24 Table of contents •Technology and Portfolio Expansion: Customer requirements are evolving toward higher-density, more complex infrastructure environments, including, but not limited to, hybrid air and liquid cooling architectures, converged physical infrastructure systems, and high voltage direct current power architectures.
MD&A / evolving cooling and power architecture requirements · Filed 29/07/2026
These solutions shift a greater portion of engineering, assembly, and validation into the factory, reducing on-site installation complexity and reliance on scarce skilled labor, while improving deployment speed, consistency, and execution certainty.
MD&A / asserted benefits of factory engineering and validation · Filed 13/02/2026
The increase in sales is primarily due to higher sales volumes and price realization of $470 compared to the prior year, and partially offset by the negative impacts from foreign currency of $43.7.
2023 MD&A / realized pricing contribution to sales · Filed 23/02/2024
Margin increased primarily due to higher sales volume, pricing actions more than offsetting higher commodity and logistics costs, and improved leverage of fixed costs.
2023 MD&A / pricing actions versus commodity and logistics costs · Filed 23/02/2024
Margin increased primarily due to higher sales volume and improved price realization.
2024 MD&A / volume and improved price realization · Filed 18/02/2025
Gross profit was $3,715.2 in 2025, or 36.3% of sales, compared to $2,934.2, or 36.6% of sales in 2024.
2025 MD&A / comparative gross margins · Filed 13/02/2026
Margin was relatively flat as benefits from higher sales volume and improved price realization were offset by cost inflation, particularly related to tariffs.
2025 MD&A / price realization and tariff inflation · Filed 13/02/2026
Gross profit was $1,234.9 in the second quarter of 2026, or 37.7% of sales, compared to $896.6, or 34.0% of sales in the second quarter of 2025.
Second-quarter 2026 MD&A / comparative gross margins · Filed 29/07/2026
Margin expansion in the second quarter of 2026 was primarily driven by the mix of product and service sales.
Second-quarter 2026 MD&A / product and service mix explanation · Filed 29/07/2026
RESULTS OF OPERATIONS Comparison of the Three Months Ended June 30, 2026 and Three Months Ended June 30, 2025 (Dollars in millions) Three months ended June 30, 2026 Three months ended June 30, 2025 $ Change % Change Net sales $ 3,274.3 $ 2,638.1 $ 636.2 24.1 % Cost of sales 2,039.4 1,741.5 297.9 17.1 Gross profit 1,234.9 896.6 338.3 37.7 Selling, general and administrative expenses 494.4 395.6 98.8 25.0 Amortization of intangibles 73.7 46.9 26.8 57.1 Restructuring costs (3.9) 1.9 (5.8) (305.3) Foreign currency (gain) loss, net 3.9 2.3 1.6 69.6 Other operating expense (income) 28.9 7.5 21.4 285.3 Operating profit (loss) 637.9 442.4 195.5 44.2 Interest expense (income), net 17.4 21.3 (3.9) (18.3) Other non-operating expense (income) 0.5 — 0.5 — Income tax expense 122.2 96.9 25.3 26.1 Net income (loss) $ 497.8 $ 324.2 $ 173.6 53.5 % Net Sales Net sales were $3,274.3 in the second quarter of 2026, an increase of $636.2, or 24.1%, compared with $2,638.1 in the second quarter of 2025.
Second-quarter 2026 results / sales and operating profit · Filed 29/07/2026
The increase in sales was primarily driven by higher sales volumes, acquisition related sales of $129.7, positive impacts from foreign currency of $35.9, which were slightly offset by temporary supply chain congestion and multi-phased project execution.
Second-quarter 2026 MD&A / acquisition sales and supply congestion · Filed 29/07/2026
31 Table of contents Summary Statement of Cash Flows Six Months Ended June 30, 2026 and 2025 (Dollars in millions) 2026 2025 $ Change % Change Net cash provided by (used for) operating activities $ 1,866.6 $ 626.2 $ 1,240.4 198.1 % Net cash provided by (used for) investing activities (780.7) (182.8) (597.9) (327.1) Net cash provided by (used for) financing activities (3.0) (32.9) 29.9 90.9 Capital expenditures (285.9) (81.5) (204.4) (250.8) Investments in capitalized software (2.6) (3.2) 0.6 18.8 Net Cash provided by (used for) Operating Activities Net cash provided by operating activities was $1,866.6 in the first six months of 2026, a $1,240.4 increase in cash generation compared to the first six months of 2025.
Liquidity / first-half 2026 cash flows and capital expenditures · Filed 29/07/2026
Trade working capital provided $678.8 in the first six months of 2026 compared to $95.2 utilized in the first six months of 2025 primarily driven by deferred revenue.
Liquidity / deferred revenue contribution to working capital · Filed 29/07/2026
The increased use of cash over the comparable period was primarily driven by an increase in acquisition of businesses of $278.1, a $204.4 increase in capital expenditures in order to support capacity expansion across the business, and an increase in net purchases of short-term investments of $97.0.
Liquidity / acquisition spending and capacity expansion · Filed 29/07/2026
We and our subsidiaries are party to certain indebtedness arrangements, which include the Senior Secured Notes due 2028, with an outstanding principal amount of $850.0 as of June 30, 2026 (the “Senior Secured Notes”), the Senior Notes in aggregate principal amount $2,100.0, consisting of $600.0 aggregate principal amount of 4.850% Senior Notes due 2036 (the “2036 Notes”), $500.0 aggregate principal amount of 5.650% Senior Notes due 2046 (the “2046 Notes”), $500.0 aggregate principal amount of 5.800% Senior Notes due 2056 (the “2056 Notes”) and $500.0 aggregate principal amount of 5.950% Senior Notes due 2066 (the “2066 Notes” and, together with the 2036 Notes, the 2046 Notes and the 2056 Notes, the “Senior Notes”), and the Senior Unsecured Revolving Credit Facility in an aggregate committed amount of $2,500.0 (the “Senior Unsecured Revolving Credit Facility”), a portion of which is available for the issuance of letters of credit.
Capital resources / outstanding notes and revolving facility · Filed 29/07/2026
The details of the earnings (loss) per share calculations for the years ended December 31, 2025, 2024, and 2023 are as follows: Year Ended December 31, (in millions, except per share and per share amounts) 2025 2024 2023 Net income (loss) $ 1,332.8 $ 495.8 $ 460.2 Weighted-average number of shares outstanding - basic 381,712,181 376,418,933 380,144,059 Dilutive effect of equity-based compensation $ 8,940,643 $ 9,906,125 $ 6,082,208 Weighted-average number of shares outstanding - diluted 390,652,824 386,325,058 386,226,267 Earnings (loss) per share Basic 3.49 1.32 1.21 Diluted 3.41 1.28 1.19 The dilutive effect of stock awards was 8.9 million for the year ended December 31, 2025.
Earnings per share / basic shares and equity award dilution · Filed 13/02/2026
Base Salary at 12/31/25 ($) Albertazzi 1,300,000 Chamberlin 750,000 Sanghi 535,000 Gill 580,000 Armul 480,000 32 | - 2026 Proxy Statement Table of Contents 2 Vertiv Annual Incentive Plan Our focus for the 2025 Vertiv Incentive Plan (“VIP”) was to align employees under a common set of goals tied to adjusted operating profit and adjusted free cash flow, both of which help us to maintain our focus on improving Vertiv’s operational execution and financial performance and driving stockholder value, while also recognizing our overall performance, segment and regional performance, and individual contributions to our long-term goals.
Compensation Discussion and Analysis / 2025 annual incentive metrics · Filed 24/04/2026
Our CEO received an increased equity grant in the form of stock options in 2025.
Compensation Discussion and Analysis / actual 2025 CEO option grant · Filed 24/04/2026
% of Target) Earned Bonus ($)(1) Albertazzi 150 % 1,950,000 205 % 4,000,000 Chamberlin(2) N/A N/A N/A N/A Sanghi 80 % 428,000 257 % 1,100,000 Gill 75 % 435,000 195 % 850,000 Armul 70 % 336,000 149 % 500,000 Fallon 100 % 690,000 (3) 837,074 (1) Amounts were subject to rounding.
Compensation Discussion and Analysis / actual 2025 bonus payouts · Filed 24/04/2026
Board Committees Our Board has three standing Committees: an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee, each of which is composed solely of independent directors.
Corporate governance / independent standing committees · Filed 24/04/2026
Currently, we separate the roles of chairman of the Board of Directors and CEO.
Corporate governance / separation of chairman and CEO · Filed 24/04/2026
In the year ended December 31, 2025, all members of our Board of Directors attended at least 75% of the aggregate of: (i) the total number of meetings of the Board of Directors (held during the period for which he or she has been a director) and (ii) the number of meetings held by all Committees of the Board of Directors (during the periods that he or she served on such Committees).
Corporate governance / actual 2025 board and committee attendance · Filed 24/04/2026
The Executive Change of Control Plan (“CIC Plan”) provides “double-trigger” severance benefits to senior employees, including the named executive officers, upon specified terminations of employment from Vertiv in connection with a change of control of Vertiv (as defined in the CIC Plan).
Executive benefits / double-trigger change-of-control severance · Filed 24/04/2026
The complaints allege that the named directors and officers caused the Company to issue materially false and/or misleading public statements with respect to inflationary and supply chain pressures and pricing issues, and that the Company suffered damages as a result.
Contingencies / allegations concerning pricing and supply-chain statements · Filed 29/07/2026
However, the Company is unable at this time to predict the outcome of these matters or the amount of any cost associated with their resolution.
Contingencies / unresolved litigation outcome · Filed 29/07/2026
On September 3, 2021, the arbitrator issued an interim phase one ruling finding (1) that Vertiv was in violation of California contractor license regulations and was barred from recovery of approximately $9.0 for work performed and equipment delivered in connection with the project, as well as requiring disgorgement plus interest of $10.0, (2) SVO was not in violation of California’s contractor license regulations, and (3) Vertiv and SVO agreed to a traditional baseball arbitration provision under the terms and conditions for the project, wherein each party is required to submit a proposed final award to the arbitrator for consideration, and the arbitrator is required to select one of the proposed awards submitted by the parties as the final award in the arbitration and is prohibited from issuing an alternative award.
Contingencies / historical adverse contractor-licensing arbitration ruling · Filed 13/02/2026
On December 31, 2021, the parties entered into a settlement agreement on ordinary and customary terms, settling all of the disputes between them.
Contingencies / December 2021 settlement · Filed 13/02/2026
• We benefit from the retention value provided through multi-year vesting and long-term exercise period.
Compensation Discussion and Analysis / option vesting and exercise period · Filed 24/04/2026
