The Cooper Companies Inc.
12/05/2025 | Press release | Distributed by Public on 12/05/2025 15:28
Annual Report for Fiscal Year Ending OCTOBER 31, 2025 (Form 10-K)
Management's Discussion and Analysis of Financial Condition and Results of Operations.
Note numbers refer to "Notes to Consolidated Financial Statements" in Item 8. Financial Statements and Supplementary Data.
Results of Operations
In this section, we discuss the results of our operations for fiscal 2025 compared with fiscal 2024. We discuss our cash flows and current financial condition under "Capital Resources and Liquidity." For a discussion related to fiscal 2024 compared with fiscal 2023, please refer to Item 7 of Part II, "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the year ended October 31, 2024, which was filed with the SEC on December 6, 2024, and is available on the SEC's website at www.sec.gov and our Investor Relations website at investor.coopercos.com.
Within the tables presented, percentages are calculated based on the underlying whole-dollar amounts and, therefore, may not recalculate exactly from the rounded numbers used for disclosure purposes.
Outlook
We are optimistic about the long-term prospects for the worldwide contact lens and general health care markets, and the resilience of and growth prospects for our businesses and products. However, we face significant risks and uncertainties in our global operating environment as further described in the "Risk Factors" section in Part I, Item 1A of this filing. These risks include uncertain global and regional business, political and economic conditions, including but not limited to those associated with man-made or natural disasters, pandemic conditions, inflation, foreign exchange rate fluctuations, regulatory developments, supply chain disruptions, and escalating global trade barriers and disruptions, such as the impact of tariffs. These risks and uncertainties have adversely affected our sales, cash flow and performance in the past and could further adversely affect our future sales, cash flow and performance.
CooperVision- We compete in the worldwide contact lens market with our spherical, toric, multifocal and toric multifocal contact lenses offered in materials like silicone hydrogel Aquaform technology. We believe that there will be lower contact lens wearer dropout rates as technology improves and enhances the wearing experience through a combination of improved designs and materials and the growth of preferred modalities such as single-use and monthly wearing options. CooperVision also competes in the myopia management and specialty eye care contact lens markets with myopia management contact lenses using its ActivControl technology and with products such as orthokeratology (ortho-k) and scleral lenses. CooperVision has FDA approval for its MiSight 1 day lens, which is the first and only FDA-approved product indicated to slow the progression of myopia in children with treatment initiated between the ages of 8-12. Further, CooperVision received Chinese NMPA approval for use of the MiSight 1 day lens in China and received MHLW approval for use of the MiSight 1 day lens in Japan. CooperVision is focused on greater worldwide market penetration using recently introduced products, and we continue to expand our presence in existing and emerging markets, including through acquisitions.
Our ability to compete successfully with a full range of silicone hydrogel products is an important factor to achieving our desired future levels of sales growth and profitability. CooperVision manufactures and markets a wide variety of silicone hydrogel contact lenses. Our single-use silicone hydrogel product franchises, clariti, MyDay and MyDay Energys remain a focus as we expect increasing demand for these products, as well as future single-use products, as the global contact lens market continues to shift to this modality. Outside of single-use, the Biofinity and Avaira Vitality product families comprise our focus in the FRP, or frequent replacement product, market which encompasses the monthly and two-week modalities. Included in this segment are unique products such as Biofinity Energys, which helps individuals with digital eye fatigue.
CooperSurgical -Our CooperSurgical business competes in the fertility and women's health care market through its diversified portfolio of products and services, including fertility products and services, medical devices, cryostorage (such as cord blood and cord tissue storage) and contraception. CooperSurgical has established its market presence and distribution system by developing products and acquiring companies, products and services that complement its business model.
Competitive factors in the segments in which CooperSurgical competes include technological and scientific advances, product quality and availability, price and customer service (including response time and effective communication of product information to physicians, consumers, fertility clinics and hospitals).
THE COOPER COMPANIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and Results of Operations
We protect our products through patents and trademark registrations, both in the United States and in international markets. We monitor competitive products trademark use worldwide and, when determined appropriate, we have enforced and plan to continue to enforce and defend our patent and trademark rights. We also rely upon trade secrets, licenses, technical know-how and continuing technological innovation to develop and maintain our competitive position.
CooperVision, CooperSurgical, and other trade names, trademarks or service marks of the Company and its subsidiaries appearing in this report are the property of the Company and its subsidiaries. Trade names, trademarks and service marks of the other companies appearing in this report are the property of their respective holders.
Net Sales
CooperVision Net Sales
The contact lens market has two major product categories:
•Toric and multifocal lenses including lenses that, in addition to correcting near- and farsightedness, address more complex visual defects such as astigmatism and presbyopia by adding optical properties of cylinder and axis, which correct for irregularities in the shape of the cornea; and
•Spherical lenses, including lenses that correct near- and farsightedness uncomplicated by more complex visual defects, myopia management lenses, which slow the progression of and correct myopia in age-appropriate children, and other specialty lenses.
THE COOPER COMPANIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and Results of Operations
CooperVision Net Sales by Category
| ($ in millions) | 2025 | 2024 |
2025 vs 2024 % Change
|
||||||||||||||
|
Toric and multifocal
|
$ | 1,351.3 | $ | 1,257.2 | 7 | % | |||||||||||
|
Sphere, other
|
1,392.5 | 1,352.2 | 3 | % | |||||||||||||
| $ | 2,743.8 | $ | 2,609.4 | 5 | % | ||||||||||||
In the fiscal year ended October 31, 2025, the growth experienced across all categories was positively impacted by favorable foreign exchange rate fluctuations of approximately $16.0 million.
•Toric and multifocal grew primarily through the success of Biofinity and MyDay.
•Sphere, other grew primarily through MiSight and MyDay, offset by a decrease in legacy hydrogel products.
•"Other" products represented less than 1% of net sales in fiscal 2025 and 2024.
CooperVision Net Sales by Geography
CooperVision competes in the worldwide soft contact lens market and services in three primary regions: the Americas, EMEA and Asia Pacific.
| ($ in millions) | 2025 | 2024 |
2025 vs. 2024 % Change
|
||||||||||||||
| Americas | $ | 1,124.3 | $ | 1,067.3 | 5 | % | |||||||||||
| EMEA | 1,064.4 | 988.3 | 8 | % | |||||||||||||
| Asia Pacific | 555.1 | 553.8 | - | % | |||||||||||||
| $ | 2,743.8 | $ | 2,609.4 | 5 | % | ||||||||||||
CooperVision's growth in net sales in the Americas and EMEA was primarily attributable to market gains of silicone hydrogel contact lenses. The growth in EMEA was positively impacted by favorable foreign exchange rate fluctuations. Refer to CooperVision Net Sales by Category above for further discussion.
THE COOPER COMPANIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and Results of Operations
CooperSurgical Net Sales
CooperSurgical supplies the fertility and women's health care market with a diversified portfolio of products and services in two categories:
•Office and surgical offerings include products that facilitate surgical and non-surgical procedures that are commonly performed primarily by obstetricians and gynecologists in hospitals, surgical centers, and medical offices. This includes medical devices, cryostorage (such as cord blood and cord tissue storage), and contraception.
•Fertility offerings include highly specialized products and services that target the in vitro fertilization process, including diagnostics testing with a goal to make fertility treatment safer, more efficient and convenient. This includes fertility consumables and equipment, donor gamete services, and genomic services (including genetic testing).
CooperSurgical Net Sales by Category
|
($ in millions) |
2025 | 2024 |
2025 vs. 2024 % Change
|
|||||||||||||||||
| Office and surgical | $ | 824.0 | $ | 774.7 | 6 | % | ||||||||||||||
| Fertility | 524.6 | 511.3 | 3 | % | ||||||||||||||||
| $ | 1,348.6 | $ | 1,286.0 | 5 | % | |||||||||||||||
In the fiscal year ended October 31, 2025, office and surgical net sales increased primarily due to increased sales of Paragard contraceptive intrauterine devices and the acquisition of obp Surgical on August 1, 2024. Fertility net sales increased primarily due to an increase in revenue from genomic services and gamete services.
Gross Margin
Consolidated gross margin decreased in fiscal 2025 to 66% compared to 67% in fiscal 2024, primarily driven by inventory and long-lived asset write-offs and severance costs related to workforce optimization initiatives.
THE COOPER COMPANIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and Results of Operations
Selling, General and Administrative (SGA) Expenses
| ($ in millions) | 2025 |
% Net Sales |
2024 |
% Net Sales |
2025 vs. 2024 % Change
|
||||||||||||||||||||||||
| CooperVision | $ | 969.3 | 35 | % | $ | 910.7 | 35 | % | 6 | % | |||||||||||||||||||
| CooperSurgical | 568.4 | 42 | % | 534.2 | 42 | % | 6 | % | |||||||||||||||||||||
| Corporate | 90.1 | - | 88.8 | - | 1 | % | |||||||||||||||||||||||
| $ | 1,627.8 | 40 | % | $ | 1,533.7 | 39 | % | 6 | % | ||||||||||||||||||||
CooperVision's SGA expenses increased in fiscal 2025 compared to fiscal 2024 primarily due to increased selling activities, severance costs related to workforce optimization initiatives, and long-lived asset write-offs.
CooperSurgical'sSGA expenses increased in fiscal 2025 compared to fiscal 2024 primarily due to severance costs related to workforce optimization initiatives, increased selling activities, and long-lived asset write-offs.
Corporate SGA expenses increased in fiscal 2025 compared to fiscal 2024 primarily due to an increase in severance costs related to workforce optimization initiatives.
Research and Development (R&D) Expenses
| ($ in millions) | 2025 |
% Net Sales |
2024 |
% Net Sales |
2025 vs. 2024 % Change
|
||||||||||||||||||||||||
| CooperVision | $ | 91.3 | 3 | % | $ | 82.9 | 3 | % | 10 | % | |||||||||||||||||||
| CooperSurgical | 80.9 | 6 | % | 72.2 | 6 | % | 12 | % | |||||||||||||||||||||
| $ | 172.2 | 4 | % | $ | 155.1 | 4 | % | 11 | % | ||||||||||||||||||||
CooperVision's R&D expenses increased in fiscal 2025 compared to fiscal 2024 primarily due to an increase in R&D project spend. CooperVision's R&D activities are primarily focused on the development of contact lenses, manufacturing technology and process enhancements.
CooperSurgical's R&D expenses increased in fiscal 2025 compared to fiscal 2024 primarily due to an increase in R&D project spend. CooperSurgical's R&D activities are primarily focused on the development of surgical devices and fertility solutions, manufacturing technology and process enhancements.
Amortization Expense
| ($ in millions) | 2025 |
% Net Sales |
2024 |
% Net Sales |
2025 vs. 2024 % Change
|
||||||||||||||||||||||||
| CooperVision | $ | 21.0 | 1 | % | $ | 28.2 | 1 | % | (26) | % | |||||||||||||||||||
| CooperSurgical | 178.2 | 13 | % | 173.0 | 13 | % | 3 | % | |||||||||||||||||||||
| $ | 199.2 | 5 | % | $ | 201.2 | 5 | % | (1) | % | ||||||||||||||||||||
CooperVision's amortization expense decreased in fiscal 2025 compared to fiscal 2024,primarily due to certain intangible assets being fully amortized.
CooperSurgical's amortization expense increased infiscal 2025 compared to fiscal 2024, primarily due to the amortization of intangible assets acquired through acquisitions in the second half of fiscal 2024.
THE COOPER COMPANIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and Results of Operations
Operating Income
| ($ in millions) | 2025 |
% Net Sales |
2024 |
% Net Sales |
2025 vs. 2024 % Change
|
||||||||||||||||||||||||
| CooperVision | $ | 729.6 | 27 | % | $ | 676.2 | 26 | % | 8 | % | |||||||||||||||||||
| CooperSurgical | 43.4 | 3 | % | 118.3 | 9 | % | (63) | % | |||||||||||||||||||||
| Corporate | (90.1) | - | (88.8) | - | 1 | % | |||||||||||||||||||||||
| $ | 682.9 | 17 | % | $ | 705.7 | 18 | % | (3) | % | ||||||||||||||||||||
CooperVision's operating income increased in fiscal 2025 compared to fiscal 2024, primarily due to the increase in net sales outpacing the increase in operating expenses.
CooperSurgical's operating income decreased in fiscal 2025 compared to fiscal 2024, primarily due to inventory and long-lived asset write-offs, severance costs related to workforce optimization initiatives and an increase in amortization expense.
Corporate operating loss increased in fiscal 2025 compared to fiscal 2024, primarily due to an increase in severance costs related to workforce optimization initiatives.
Interest Expense
| ($ in millions) | 2025 |
% Net Sales |
2024 |
% Net Sales |
2025 vs. 2024 % Change
|
||||||||||||||||||||||||
| Interest expense | $ | 100.0 | 2 | % | $ | 114.3 | 3 | % | (13) | % | |||||||||||||||||||
Interest expense decreased during fiscal 2025 compared to the prior year, primarily due to lower interest rates and lower average debt balances.
Other Expense, Net
| ($ in millions) | 2025 | 2024 | |||||||||
| Foreign exchange loss | $ | 8.0 | $ | 5.2 | |||||||
|
Other expense, net
|
8.4 | 3.9 | |||||||||
| $ | 16.4 | $ | 9.1 | ||||||||
Foreign exchange loss was primarily due to movements of U.S. dollar against various foreign currencies and the effect on intercompany receivables and payables.
Other expense, net increased in fiscal 2025, primarily due to a loss on the disposal of a minority interest investment.
Provision for Income Taxes
The effective tax rates for fiscal 2025 and 2024 were 33.8% and 32.6%, respectively. The increase was primarily due to changes in valuation allowance and a decrease in excess tax benefits from share-based compensation, partially offset by changes in unrecognized tax benefits and changes in the geographic composition of pre-tax earnings.
The effective tax rate for fiscal 2025 and 2024 was higher than the U.S. federal statutory rate primarily due to foreign earnings subject to U.S. tax and foreign earnings in jurisdictions with different tax rates.
The One Big Beautiful Bill Act was enacted in the United States during the third quarter of fiscal 2025. It is not expected to have a material impact on the provision for income taxes.
See Note 6. Income Taxes for further information.
THE COOPER COMPANIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and Results of Operations
CAPITAL RESOURCES AND LIQUIDITY
Working capital at October 31, 2025, and October 31, 2024, was $993.6 million and $928.7 million, respectively. The increase in working capital was primarily due to increases in trade accounts receivable mainly driven by higher sales and timing of collections and inventories, partially offset by increases in accounts payable, employee compensation and benefits and short-term debt.
Cash Flow
| ($ in millions) | 2025 | 2024 | 2023 | ||||||||||||||
| Operating activities | $ | 796.1 | $ | 709.3 | $ | 607.5 | |||||||||||
| Investing activities | (372.9) | (764.6) | (449.0) | ||||||||||||||
| Financing activities | (425.9) | 39.2 | (173.9) | ||||||||||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | 5.6 | 2.9 | (2.3) | ||||||||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | $ | 2.9 | $ | (13.2) | $ | (17.7) | |||||||||||
Operating Cash Flow
Cash provided by operating activities in fiscal 2025 increased compared to fiscal 2024, primarily due to changes in prepaid and other assets and an increase in non-cash add-back of long-lived asset write-offs.
Investing Cash Flow
Cash used in investing activities in fiscal 2025 decreased compared to cash used in investing activities in fiscal 2024, primarily attributable to $343.4 million cash paid for acquisitions in fiscal 2024.
Financing Cash Flow
Cash used in financing activities in fiscal 2025 was primarily attributable to the repurchase of common stock, net repayments on the revolving credit, and the first installment payment related to the Cook Medical acquisition.
Cash provided by financing activities in fiscal 2024 was primarily attributable to funds received from the 2024 Revolving Credit Facility, partially offset by repayments to fully repay all borrowings outstanding under the 2020 Term Loan Facility and the 2020 Revolving Credit Facility. See Note 5. Financing Arrangements for further information.
The following is a summary of the maximum commitments and the net amounts available to us under different credit facilities as of October 31, 2025:
| (In millions) | Facility Limit | Outstanding Borrowings | Outstanding Letters of Credit | Total Amount Available | Maturity Date | |||||||||||||||||||||||||||
| Revolving Credit: | ||||||||||||||||||||||||||||||||
| 2024 Revolving Credit | $ | 2,300.0 | $ | 956.3 | $ | 5.3 | $ | 1,338.4 | May 1, 2029 | |||||||||||||||||||||||
| Term Loan: | ||||||||||||||||||||||||||||||||
| 2021 Term Loan | 1,500.0 | 1,500.0 | n/a | - | December 17, 2026 | |||||||||||||||||||||||||||
| Total | $ | 3,800.0 | $ | 2,456.3 | $ | 5.3 | $ | 1,338.4 | ||||||||||||||||||||||||
As of October 31, 2025, the Company was in compliance with all debt covenants. On May 1, 2024, the Company entered into a Revolving Credit Agreement (the 2024 Credit Agreement). The Company drew on the 2024 Credit Agreement to fully repay borrowings outstanding under the 2020 Term Loan and 2020 Revolving Credit Facility and terminated the 2020 Credit Agreement. See Note 5. Financing Arrangements for further information.
We have re-evaluated our operating cash flows and cash requirements and continue to believe that current cash, cash equivalents, future cash flow from operating activities and cash available under our 2024 Credit Agreement will be sufficient to meet our anticipated cash needs, including working capital needs, capital expenditures and contractual obligations for at least 12 months from the issuance date of the Consolidated Financial Statements included in this annual report. To the extent additional funds are necessary to meet our liquidity needs such as for acquisitions, share repurchases or other activities as we execute our business strategy, we anticipate that additional funds could be obtained through the incurrence of additional indebtedness, additional equity financings or a combination of these potential sources of funds; however, such financing may not be available on favorable terms, or at all.
THE COOPER COMPANIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and Results of Operations
Share Repurchase
In September 2025, the authorization under the 2012 Share Repurchase Program was increased to $2.0 billion by the Company's Board of Directors. As of October 31, 2025, $966.4 million remains authorized for repurchase.
In fiscal 2025, the Company repurchased 4.1 million shares of its common stock for $290.1 million, at a weighted average price of $69.30 per share under the program. In fiscal 2024, there were no share repurchases under the program. See Note 8. Stockholders' Equity for additional information.
Dividends
In December 2023, the Company's Board of Directors decided to end the declaration of the semiannual dividend.
Stock Split
On February 16, 2024, the Company effected a four-for-one stock split of its outstanding shares of common stock. All share and per share information has been retroactively adjusted to reflect the stock split for all periods presented. The par value of the common stock remains $0.10 per share.
Contractual Obligations
As of October 31, 2025, our material cash requirements consisted of future payments for debt and related interests, income tax liabilities related to one-time transition tax, purchase obligations, operating lease and Retirement Income Plan.
We incur interest on a revolving loan and a term loan. Using the same interest rate of October 31, 2025, and assuming borrowings as of October 31, 2025, remain constant throughout all periods, these loans would result in interest payments of $98.7 million in the twelve months ending October 31, 2026, and $128.9 million in the years thereafter. See Note 5. Financing Arrangements for additional information related to debt and interests.
Income tax liabilities related to the one-time transition tax resulted from the enactment of the 2017 U.S. Tax Act and are payable in annual installments through fiscal 2026. The installment for fiscal 2025 is classified in "Other current liabilities" in our Consolidated Balance Sheet. See Note 6. Income Taxes for the expected one-time transition tax payments.
Purchase obligations consist of agreements to purchase goods and services that are enforceable and legally binding and includes obligations for inventory, capital expenditures and other operating expense commitments. As of October 31, 2025, we had purchase obligations of $585.1 million, with $279.3 million payable within the twelve months ending October 31, 2026.
The minimum future payments for operating leases are disclosed in Note 2. Operating Leases and the expected future benefit payments for our Retirement Income Plan through 2035 are disclosed in Note 10. Employee Benefits.
THE COOPER COMPANIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and Results of Operations
Critical Accounting Estimates
Management estimates and judgments are an integral part of financial statements prepared in accordance with GAAP. We consider an accounting estimate critical if changes in the estimate may have a material impact on our financial condition or results of operations. We believe that the accounting estimates employed are appropriate and resulting balances are reasonable, however, actual results could differ from the original estimates, requiring adjustment to these balances in future period. The critical accounting policies described in this section address the more significant estimates required of management when preparing the Consolidated Financial Statements in accordance with GAAP.
•Revenue recognition - We recognize revenue from product sales when obligations under the terms of a contract with the customer are satisfied; generally, this occurs with the transfer of control of the goods to customers and/or when services are rendered. Our payment terms are typically between 30 to 120 days. Provisions for certain rebates, sales incentives, volume discounts, contractual pricing allowances and product returns are accounted for as variable consideration and recorded as a reduction in sales. Estimating these provisions requires judgment based on current and historical customer patterns related to these programs or contractual terms as described below.
Product discounts, including certain rebates, sales incentives, and volume discounts are granted based on terms of the arrangement with direct distribution customers and at times the indirect end consumer. We evaluate contractual terms, historical experience, and perform internal analysis to estimate total product discounts at the time revenue is recognized. Variations between our estimates and actual product discounts have not been material. CooperSurgical rebates are predominately related to the Medicaid rebate provision that is estimated based upon contractual terms, historical experience, and trend analysis which requires judgment due to the length of time between sale and reimbursement from Medicaid.
Sales returns are estimated and recorded based on historical sales return data. Promotional programs, such as cooperative advertising arrangements, are recorded in the same period as related sales. Reasonably likely changes to assumptions used to calculate the accruals for rebates, sales incentives, volume discounts, contractual pricing allowances and product returns are not anticipated to have a material effect on the financial statements. We currently disclose the impact of changes to assumptions in the quarterly or annual filing in which there is a material financial statement impact.
•Business combinations - We routinely consummate business combinations. Results of operations for acquired companies are included in our consolidated results of operations from the date of acquisition. We recognize separately from goodwill, the identifiable assets acquired, including acquired in-process research and development (IPR&D), the liabilities assumed, and any noncontrolling interest in the acquiree at the acquisition date fair values as defined by accounting standards related to fair value measurements. The fair value of the identifiable intangible assets is determined primarily using the "income approach." Key assumptions routinely utilized in the income approach to allocate the purchase price to intangible assets include risk-adjusted discount rates and projected financial information such as revenue projections, expected gross and operating margins for the acquired companies. The fair value of IPR&D also factors in probability assumptions about the stage of development and successful completion. If the actual results differ from the estimates and judgments used in these estimates, the amounts recorded in the financial statements could result in a possible impairment of the intangible assets and goodwill.
•Income taxes - Income taxes are estimated based on enacted income tax laws and the results of operations in each jurisdiction. Deferred tax assets and liabilities are estimated based on temporary differences between the financial reporting basis and income tax basis of assets and liabilities. Judgment is required in measuring the value of deferred tax assets, which are reduced by a valuation allowance to the extent it is more likely than not that the tax benefits are not expected to be realized, including tax credits and net operating loss carryforwards expected to expire before they can be claimed or deducted. For uncertain tax positions, judgment is required in evaluating tax positions for uncertainty in the application of accounting guidance and tax laws. A tax benefit is recognized if it is more likely than not a tax position will be sustained based on its technical merits in a tax authority examination, based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority.
Accounting Pronouncements
Information regarding new accounting pronouncements is included in Note 1. Organization and Significant Accounting Policies.
THE COOPER COMPANIES, INC. AND SUBSIDIARIES
The Cooper Companies Inc. published this content on December 05, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on December 05, 2025 at 21:28 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]