Financial Data and Key Metrics Changes - Fortive Corporation reported a 12% core revenue growth year-over-year, with adjusted gross and operating margins expanding by 80 and 160 basis points respectively [5][14] - Adjusted earnings per share grew by 20% to $0.79, and free cash flow increased by 22% [5][15] - The company anticipates a foreign exchange headwind of approximately $175 million on revenue and $0.11 on EPS for the year [6] Business Line Data and Key Metrics Changes - Intelligent Operating Solutions (IOS) saw a 14% revenue increase, with broad-based growth across regions [8] - Facilities and Asset Lifecycle segment, including Gordian and Accruent, experienced double-digit revenue growth, driven by strong software demand [9] - Precision Technologies reported a 19% core revenue growth, with double-digit growth across major regions [10] - Advanced Healthcare Solutions (AHS) had a total revenue increase of 3%, but core revenue declined by 1% due to supply chain constraints [11] Market Data and Key Metrics Changes - North America revenue grew low double digits, with mid-teens growth in software [14] - Western Europe revenue increased mid-teens, while Asia revenue rose in the low 20% range, with mid-20% growth in China [14] - The company noted that hardware product backlog is more than double what it was at the beginning of 2021 [6] Company Strategy and Development Direction - Fortive is focused on leveraging its portfolio to create long-term sustainable competitive advantages and drive profitable growth [5][7] - The company is preparing for various macroeconomic scenarios in 2023, including moderating hardware product orders growth [6] - Fortive's strategy emphasizes sustainability, with over 60% of its products and services aligned with the United Nations' sustainable development goals [7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to outperform despite potential economic challenges, citing strong demand and backlog [19] - The company expects supply chain normalization but acknowledges that challenges may persist into 2023 [19] - Management anticipates mid-single-digit growth in the healthcare market for 2023, with improvements expected in hospital operations [50][51] Other Important Information - Fortive's balance sheet remains strong, with a $2 billion revolving credit facility extended to 2027 and a new $1 billion delayed draw term loan [17] - The company has nearly doubled its free cash flow over the last three years, demonstrating strong cash compounding power [20] Q&A Session Summary Question: Can you parse out how much of the hardware backlog reflects incremental demand versus supply chain inefficiencies? - Management indicated that a significant portion of the backlog is due to demand, particularly at Tektronix, while Fluke is seeing a reduction in backlog as lead times normalize [26] Question: Can you break out the year-over-year margin decline in Advanced Healthcare Solutions? - The decline was primarily due to a bad debt reserve at Invetech, along with FX and inflation impacts [29][30] Question: Is there an assumption about seasonality orders affecting the backlog? - Management confirmed that while orders are expected to slow in Q4, they do not anticipate negative orders, and backlog will still be managed effectively [34][47] Question: What is the outlook for healthcare growth in 2023? - Management expects mid-single-digit growth in the healthcare market for 2023, with improvements anticipated as supply chain issues ease [50][51] Question: How is the company positioned regarding potential acquisitions? - Management noted that the acquisition environment is becoming more attractive, with opportunities being evaluated across public and private markets [44][54] Question: What is driving the strong growth in the Gordian and Accruent businesses? - The growth is attributed to the successful integration of ServiceChannel and improvements in net dollar retention [68]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ________________________________________________ FORM 10-Q ________________________________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: September 30, 2022 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 1-37654 _____________________ ...

6 FORTIVE | --- | --- | --- | |---------------------|-------|-------| | | | | | | | | | | | | | | | | | | | | | Second Quarter 2022 | | | | | | | | Earnings Release | | | FORWARD LOOKING STATEMENTS & NON-GAAP FINANCIAL MEASURES Statements in this presentation that are not strictly historical, including statements regarding anticipated financial results, economic conditions, future prospects, impact of supply chain constraints, duration and impact of COVID-19 pandemic and the corresponding government mandate ...

Financial Data and Key Metrics Changes - The company achieved 9% core revenue growth, 190 basis points adjusted operating margin expansion, and 18% adjusted earnings per share growth in Q2 2022, exceeding guidance [5][10] - Total revenue grew by 11% year-over-year, with core growth of 9%, while acquisitions contributed 5 points to total growth [23] - Adjusted earnings per share increased 18% to $0.78, reflecting strong volume growth and lower share count [28] Business Line Data and Key Metrics Changes - Intelligent Operating Solutions (IOS) saw revenues up 16% with core revenue growth of 12%, driven by strong demand in North America and Western Europe [13] - Precision Technologies reported total revenue growth of 6% and core revenue growth of 9%, with significant demand in industrial and medical sectors [17] - Advanced Healthcare Solutions (AHS) experienced total revenue growth of 9% but core revenue growth of only 3%, impacted by COVID-related challenges in China [19] Market Data and Key Metrics Changes - North America core revenues increased by high single digits, while Western Europe revenues grew mid-teens, indicating strong performance across regions [24][25] - China revenues increased mid-teens despite lockdowns, with a 20% order growth as customers sought to replenish inventories [26] - The company noted strong double-digit revenue growth in high-growth markets [26] Company Strategy and Development Direction - The company is focused on enhancing its recurring revenue profile and diversifying its end markets, with healthcare now being the largest revenue source [11][12] - The Fortive Business System (FBS) is emphasized as a key differentiator, driving innovation and operational efficiency [21][39] - The company plans to continue prioritizing M&A as a primary driver of capital deployment while maintaining a strong balance sheet [34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to navigate supply chain challenges and inflation, expecting continued core growth in the second half of the year [9][10] - The company raised its full-year outlook, anticipating core revenue growth of 8% to 9.5% and adjusted earnings per share in the range of $3.07 to $3.13 [29][30] - Management highlighted the importance of backlog and recurring revenue as buffers against potential economic slowdowns [91][92] Other Important Information - The company achieved a free cash flow of $276 million in Q2, reflecting a 98% conversion rate [28] - Sustainability initiatives were highlighted, including early achievement of greenhouse gas emissions reduction targets [36][37] Q&A Session Summary Question: Concerns about AHS segment pricing and growth - Management acknowledged challenges in pricing and volumes, particularly in China, but anticipated acceleration in core growth for AHS in the second half [46][47] Question: Capital deployment and share buybacks - Management indicated that M&A remains a priority, with opportunistic share buybacks occurring as needed [51][52] Question: M&A pipeline and market conditions - Management noted that while private equity remains active, the market is experiencing longer transaction times and higher prices [55][56] Question: Performance in Western Europe - Management attributed strong performance in Western Europe to backlog management and favorable market conditions [57][59] Question: Insights on Tektronix order strength - Management highlighted innovation and strong demand in Tektronix, with a book-to-bill ratio of 1.3 [76][77] Question: Free cash flow dynamics - Management explained that the second half typically sees stronger free cash flow due to seasonal factors and working capital relief [100]

(9) FORTIVE | --- | --- | --- | --- | |---------------------------|-------|-------|-------| | | | | | | | | | | | Wolfe Industrial Growth & | | | | | Technology Conference | | | | 2 FORWARD LOOKING STATEMENTS & NON-GAAP FINANCIAL MEASURES Statements in this presentation that are not strictly historical, including statements regarding anticipated financial results, economic conditions, future prospects, anticipated market opportunities, business and acquisition opportunities, and any other statements identif ...

Financial Data and Key Metrics Changes - Total revenue growth of 9.3% year-over-year with core growth of 5.3% [34] - Adjusted gross margins increased by 60 basis points to 57.6% [37] - Adjusted operating margins increased to 23%, reflecting a 30 basis points expansion year-over-year [37] - Adjusted earnings per share rose 11% to $0.70, with free cash flow generation of $196 million [38] Business Line Data and Key Metrics Changes - Intelligent Operating Solutions (IOS) saw total revenue up 15% with core growth of 8.7%, driven by strong demand in North America and Western Europe [19] - Precision Technologies (PT) revenues grew 3.4% with core revenue growth of 4.6%, impacted by a low double-digit decline in China due to COVID lockdowns [22] - Advanced Healthcare Solutions (AHS) revenue increased 8.5% with core revenue growth of 0.6%, facing challenges in China and Western Europe [25] Market Data and Key Metrics Changes - North America revenue was up high single digits, with low teens growth in software and related services [35] - Western Europe revenues grew mid-single-digit, offsetting declines in advanced healthcare solutions [35] - China revenues declined low teens, but backlog in China showed high teens order growth [36] Company Strategy and Development Direction - The company aims to build a more resilient, less cyclical business model, focusing on high recurring revenue and software-enabled workflow solutions [46][47] - The M&A pipeline remains robust with an estimated capacity of approximately $5 billion over the next three years [15] - The company is committed to sustainability and innovation, with plans to publish its fifth sustainability report [30][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to weather potential economic slowdowns due to strong backlog and recurring revenue streams [56] - The company anticipates sustained core growth driven by strong customer demand and record backlog, with expectations for strong margin expansion [14] - Management highlighted the importance of countermeasures to mitigate supply chain challenges and improve operational performance [77] Other Important Information - The company executed a share buyback of approximately 1 million shares totaling $64 million in the first quarter [15] - The company has doubled its recurring revenue as a percentage of total revenue to approximately 40% since 2016 [47] Q&A Session Summary Question: What is the current situation in China regarding the economy and order pace? - Management noted that orders were up double-digit despite shutdowns, with commercial activities remaining strong [54] Question: How would the company handle a potential mild global recession? - Management indicated that the strong backlog would provide a buffer, allowing the company to dip into backlog if necessary [56] Question: Can you elaborate on the adjusted operating margin expectations? - Management explained that while revenues were flat, they expect margins to improve in Q2 due to various factors including service channel integration [62] Question: What is the outlook for orders in the current quarter? - Management reported good order strength across regions, with a positive outlook for durability in order patterns [66] Question: What tangible steps have been taken to improve volume output? - Management highlighted the effectiveness of countermeasures and improvements in supply chain management as key factors [76] Question: How is the performance of Accruent and Gordian? - Management confirmed that both businesses had a good quarter, with Accruent showing signs of growth and Gordian performing strongly [86]

Ø FORTIVE | --- | --- | --- | --- | |--------------------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | First Quarter 2022 | | | | | Earnings Release | | | | 2 FORWARD LOOKING STATEMENTS & NON-GAAP FINANCIAL MEASURES Statements in this presentation that are not strictly historical, including statements regarding anticipated financial results, economic conditions, future prospects, impact of supply chain constraints, duration and impact of COVID-19 pandemic and the correspondin ...

Financial Performance & Expectations - Fortive anticipates approximately $5.8 billion in revenue for 2022[4] - The company projects a 17% 2-year stack core growth[4] - Fortive expects an adjusted operating profit margin of 24% and a free cash flow (FCF) margin of 20% for 2022[4] - The company's recurring revenue is expected to be approximately 40% in 2022[4,8,12] - Software revenue is expected to be around $950 million in 2022[8,12] Portfolio Evolution & Strategy - Fortive has deployed over $7 billion in net capital through M&A[6] - The company's M&A activities have led to approximately $2.3 billion in acquired revenue, showing a low double-digit (LDD) growth[6] - Intelligent Operating Solutions contribute approximately 40% of sales[11] - Advanced Healthcare Solutions contribute approximately 25% of sales[11] - Precision Technologies contribute approximately 35% of sales[11]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ________________________________________________ FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 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 1-37654 ____________ FORTIVE CORPORATION (Exact name of registrant as specified in its c ...

Financial Highlights - Q4 2021 revenue reached $1.4 billion, a 3.8% year-over-year increase[6] - Full-year 2021 revenue totaled $5.3 billion, up 13.1% year-over-year[6] - Q4 2021 adjusted operating profit was $335 million, with a margin of 24.4%[6] - Full-year 2021 adjusted operating profit was $1.2 billion, with a margin of 23.1%[6] - Q4 2021 adjusted earnings per share (EPS) was $0.79, a 12.9% year-over-year increase[6] - Full-year 2021 adjusted EPS was $2.75, up 31.6% year-over-year[6] - Full-year 2021 core growth was 9.5%[6] Free Cash Flow - Q4 2021 free cash flow was $265 million, a 15.2% year-over-year decrease[6] - Full-year 2021 free cash flow was $943 million, up 4.5% year-over-year[6] 2022 Outlook - The company anticipates 5.5% to 8.5% core growth in 2022[35, 38] - The company expects total software revenue to grow strongly in double digits in 2022 to approximately $950 million[36] - The company projects adjusted EPS between $3.00 and $3.13, representing a 9% to 14% increase[38]