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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 28, 2024
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 001-33642
masimologoq32019.jpg
________________________________________________
MASIMO CORPORATION
(Exact Name of Registrant as Specified in its Charter)
________________________________________________
Delaware33-0368882
(State or Other Jurisdiction of
Incorporation or Organization)		(I.R.S. Employer
Identification Number)
52 DiscoveryIrvine,California92618
(Address of Principal Executive Offices)(Zip Code)
(949)297-7000
(Registrant’s Telephone Number, Including Area Code)
Securities Registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.001 par value
MASI
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,” “smaller 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
☒
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:
Class
Number of Shares Outstanding as of
September 28, 2024
Common stock, $0.001 par value
53,540,566

MASIMO CORPORATION
FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 28, 2024
TABLE OF CONTENTS
 
Item 1.
Item 2.
Item 3.
Item 4.
Item 1.
Item 1A.
Item 5.
Item 6.

2
PART I. FINANCIAL INFORMATION
Item 1.     Financial Statements
MASIMO CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in millions, except par values)
September 28,
2024		December 30,
2023
ASSETS
Current assets
Cash and cash equivalents$158.5 $163.0 
Trade accounts receivable, net of allowance for credit losses of $6.0 million and $4.8 million at September 28, 2024 and December 30, 2023, respectively(1)
371.0 355.5 
Inventories569.9 545.0 
Other current assets180.5 168.4 
Total current assets1,279.9 1,231.9 
Lease receivable, non-current64.2 71.4 
Deferred costs and other contract assets59.6 57.3 
Property and equipment, net417.9 424.4 
Customer relationships, net - (Note 9)169.0 177.7 
Acquired technologies, net - (Note 9)115.3 129.4 
Other intangible assets, net - (Note 9)120.9 112.8 
Trademarks - (Note 9)235.6 232.4 
Goodwill412.5 407.7 
Deferred tax assets107.1 107.2 
Other non-current assets105.8 89.3 
Total assets$3,087.8 $3,041.5 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable$280.8 $251.5 
Accrued compensation76.0 62.6 
Deferred revenue and other contract liabilities, current84.5 87.3 
Other current liabilities196.3 162.4 
Total current liabilities637.6 563.8 
Long-term debt733.2 871.7 
Deferred tax liabilities111.3 111.7 
Other non-current liabilities142.5 129.5 
Total liabilities1,624.6 1,676.7 
Commitments and contingencies - (Note 24)
Stockholders’ equity
Preferred stock, $0.001 par value; 5.0 million shares authorized; 0 shares issued and outstanding
— — 
Common stock, $0.001 par value; 100.0 million shares authorized; 53.5 million and 52.8 million shares issued and outstanding at September 28, 2024 and December 30, 2023, respectively
0.1 0.1 
Treasury stock, 19.5 million and 19.5 million shares at September 28, 2024 and December 30, 2023, respectively
(1,169.2)(1,169.2)
Additional paid-in capital828.4 783.4 
Accumulated other comprehensive loss(36.6)(45.3)
Retained earnings1,840.5 1,795.8 
Total stockholders’ equity1,463.2 1,364.8 
Total liabilities and stockholders’ equity$3,087.8 $3,041.5 
________________________________________________________
(1)    Includes amounts owed from related parties as of September 28, 2024 and December 30, 2023 of approximately $10.8 million and $7.3 million, respectively. See Note 3, “Related Party Transactions” for details.
The accompanying notes are an integral part of these condensed consolidated financial statements.
3
MASIMO CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in millions, except per share amounts)
 
Three Months EndedNine Months Ended
September 28,
2024		September 30,
2023		September 28,
2024		September 30,
2023
Revenue(1)
$504.6 $478.9 $1,493.7 $1,499.2 
Cost of goods sold241.4 244.1 734.0 758.4 
Gross profit263.2 234.8 759.7 740.8 
Operating expenses:
Selling, general and administrative184.8 156.1 522.2 504.1 
Research and development48.3 46.5 145.1 137.2 
Impairment charge— 7.0 — 7.0 
Total operating expenses233.1 209.6 667.3 648.3 
Operating income30.1 25.2 92.4 92.5 
Non-operating loss(18.5)(11.2)(36.0)(27.5)
Income before provision for income taxes11.6 14.0 56.4 65.0 
Provision for income taxes1.8 3.4 11.7 17.4 
Net income$9.8 $10.6 $44.7 $47.6 
Net income per share:
Basic$0.18 $0.20 $0.84 $0.90 
Diluted$0.18 $0.20 $0.82 $0.88 
Weighted-average shares used in per share calculations:
Basic53.4 52.8 53.2 52.8 
Diluted54.3 53.9 54.3 53.9 
______________
(1)    Includes sales from related parties for the three and nine months ended September 28, 2024 of approximately $27.2 million and $82.9 million, respectively     and for the three and nine months ended September 30, 2023 of approximately $26.9 million and $69.1 million, respectively. See Note 3, “Related Party Transactions” for details.
The accompanying notes are an integral part of these condensed consolidated financial statements.
4
MASIMO CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(unaudited, in millions)
 
Three Months EndedNine Months Ended
September 28,
2024		September 30,
2023		September 28,
2024		September 30,
2023
Net income$9.8 $10.6 $44.7 $47.6 
Other comprehensive loss, net of tax:
Unrealized gains (losses) from foreign currency translation adjustments78.1 (43.2)15.0 (100.6)
       Change in pension benefits— (0.5)0.7 (3.5)
       Unrealized (loss) gain on cash flow hedges(11.3)0.4 (7.0)1.7 
Total comprehensive income (loss)$76.6 $(32.7)$53.4 $(54.8)


The accompanying notes are an integral part of these condensed consolidated financial statements.
5

MASIMO CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(in millions)
Three and Nine Months Ended September 28, 2024
Common StockTreasury StockAdditional
Paid-In
Capital
Accumulated
Other
Comprehensive (Loss)
Retained
Earnings		Total
Stockholders’
Equity
SharesAmountSharesAmount
Balance at December 30, 202352.8 $0.1 19.5 $(1,169.2)$783.4 $(45.3)$1,795.8 $1,364.8 
Stock options exercised0.2 — — — 7.2 — — 7.2 
Restricted/Performance stock units vested0.1 — — — — — — — 
Shares paid for tax withholding— — — — (5.3)— — (5.3)
Stock-based compensation— — — — 9.6 — — 9.6 
Net income— — — — — — 18.9 18.9 
Foreign currency translation adjustment— — — — — (35.6)— (35.6)
Change in pension benefits— — — — — 0.7 — 0.7 
Unrealized gain on cash flow hedge— — — — — 4.9 — 4.9 
Balance at March 30, 202453.1 0.1 19.5 (1,169.2)794.9 (75.3)1,814.7 1,365.2 
Stock options exercised0.1 — — — 2.7 — — 2.7 
Shares paid for tax withholding— — — — (0.5)— — (0.5)
Stock-based compensation— — — — 13.5 — — 13.5 
Net income— — — — — — 16.0 16.0 
Foreign currency translation adjustment— — — — — (27.5)— (27.5)
Unrealized (loss) on cash flow hedge— — — — — (0.6)— (0.6)
Balance at June 29, 202453.2 0.1 19.5 (1,169.2)810.6 (103.4)1,830.7 1,368.8 
Stock options exercised0.3 — — — 11.5 — — 11.5 
Shares paid for tax withholding— — — — (0.2)— — (0.2)
Stock-based compensation— — — — 6.5 — — 6.5 
Net income— — — — — — 9.8 9.8 
Foreign currency translation adjustment— — — — — 78.1 — 78.1 
Unrealized (loss) on cash flow hedge— — — — — (11.3)— (11.3)
Balance at September 28, 202453.5 $0.1 19.5 $(1,169.2)$828.4 $(36.6)$1,840.5 $1,463.2 

6
Three and Nine Months Ended September 30, 2023
Common StockTreasury StockAdditional
Paid-In
Capital
Accumulated
Other
Comprehensive
Income (Loss)
Retained
Earnings		Total
Stockholders’
Equity
SharesAmountSharesAmount
Balance at December 31, 202252.5 $0.1 19.5 $(1,169.2)$782.2 $11.5 $1,714.3 $1,338.9 
Stock options exercised0.1 — — — 4.3 — — 4.3 
Restricted/Performance stock units vested0.2 — — — — — — — 
Shares paid for tax withholding— — — — (12.2)— — (12.2)
Stock-based compensation— — — — 7.3 — — 7.3 
Net income— — — — — — 21.3 21.3 
Foreign currency translation adjustment— — — — — (22.8)— (22.8)
Change in pension benefits— — — — — (2.2)— (2.2)
Unrealized loss on cash flow hedge— — — — — (4.3)— (4.3)
Balance at April 1, 202352.8 0.1 19.5 (1,169.2)781.6 (17.8)1,735.6 1,330.3 
Stock options exercised— — — — 1.1 — — 1.1 
Shares paid for tax withholding— — — — (0.4)— — (0.4)
Stock-based compensation— — — — (8.6)— — (8.6)
Net income— — — — — — 15.7 15.7 
Foreign currency translation adjustment— — — — — (34.6)— (34.6)
Change in pension benefits— — — — — (0.8)— (0.8)
Unrealized gain on cash flow hedge— — — — — 5.6 — 5.6 
Balance at July 1, 202352.8 0.1 19.5 (1,169.2)773.7 (47.6)1,751.3 1,308.3 
Stock options exercised— — — — 1.2 — — 1.2 
Shares paid for tax withholding— — — — (0.1)— — (0.1)
Stock-based compensation— </