Company: WCC
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0000929008-25-000034
Chunk: 128

Company: WESCO INTERNATIONAL INC
Filing Date: 2025-10-30
Form: 10-Q
Item: Item 8
Chunk 128
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3.5 2.9 

(1)Digital transformation costs include costs associated with certain digital transformation initiatives.

(2)Restructuring costs include severance costs incurred pursuant to an ongoing restructuring plan.

(3)Cloud computing arrangement amortization consists of expense recognized in selling, general and administrative expenses for capitalized implementation costs for cloud computing arrangements to support our digital transformation initiatives.

(4)Loss on abandonment of assets represents the write-off of certain capitalized cloud computing arrangement implementation costs relating to a third-party developed operations management software product in favor of an application with functionality that better suits the Company’s operations.

(5)Excise taxes on excess pension plan assets represent the excise taxes applicable to the excess pension plan assets following the final settlement of the Company's U.S. pension plan.

(6)Debt is presented in the condensed consolidated balance sheets net of debt issuance and debt discount costs, and includes adjustments to record the long-term debt assumed in the merger with Anixter at its acquisition date fair value.

Note: Financial leverage ratio is a non-GAAP measure of the use of debt. Financial leverage ratio is calculated by dividing total debt, excluding debt issuance costs, debt discount and fair value adjustments, net of cash, by adjusted EBITDA. EBITDA is defined as the trailing twelve months earnings before interest, taxes, depreciation and amortization.

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Table of Contents   WESCO INTERNATIONAL, INC. AND SUBSIDIARIES

Most of the undistributed earnings of our foreign subsidiaries have been taxed in the U.S. under either the one-time tax imposed on the deemed repatriation of undistributed foreign earnings (the “transition tax”), or the global intangible low-taxed income tax regime imposed by the Tax Cuts and Jobs Act of 2017. However, the distribution of earnings by our foreign subsidiaries in the form of dividends, or otherwise, may be subject to additional taxation. We believe that we are able to maintain sufficient liquidity for our domestic operations and commitments without repatriating cash from our foreign subsidiaries. Therefore, we continue to assert that the remaining undistributed earnings of our foreign subsidiaries are indefinitely reinvested.

An analysis of cash flow for the first nine months of 2025 and 2024 follows:

Operating Activities 

Net cash provided by operating activities for the first nine months of 2025 totaled $53.1 million, compared to $824.6 million for the first nine months of 2024. The $771.5 million decrease is primarily driven by a $485.