Company: VRT
Filing Date: 2025-10-22
Form Type: 10-Q
Source: 0001674101-25-000024
Chunk: 104

Company: Vertiv Holdings Co
Filing Date: 2025-10-22
Form: 10-Q
Item: Part I, Item 8
Chunk 104
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 The change in fair value of these warrants was the result of changes in market prices of our common stock, and other observable inputs deriving the value of the financial instruments. On December 6, 2024, Cote SPAC I LLC elected to exercise the remaining 5,266,667 outstanding private warrants on a cashless basis pursuant to the agreement governing the warrants, in exchange for which the Company issued 4,812,521 shares of Class A common stock. As of September 30, 2025, there were no private warrants outstanding.

Interest Expense

Interest expense, net, was $69.4 in the first nine months of 2025 compared to $119.7 in the first nine months of 2024. The $50.3 decrease is primarily driven by a $23.6 increase in interest income and a $19.8 of reduced interest expense as a result of our Term Loan amendments, which resulted in a reduction to our interest rate margin. To the extent interest rates continue to fluctuate our interest expense will change, although we expect these changes to be mitigated by our interest rate swaps and interest income.

Income Taxes

Income tax expense was $291.5 in the first nine months of 2025 compared to $171.4 in the first nine months of 2024. The $120.1 increase is primarily due to increased business performance and discrete tax expense due to legislative changes effective in the first quarter of 2025, offset by discrete tax benefits for stock compensation and return to provision adjustments. The effective rate in the first nine months of 2025 was primarily influenced by the negative impact of a valuation allowance established to account for legislative changes effective in the first quarter of 2025 partially offset by discrete tax benefits for stock compensation, changes in deferred tax liabilities and return to provision adjustments. The effective rate in the first nine months of 2024 was primarily influenced by the negative impacts of non-deductible changes in fair value of the warrant liabilities and discrete tax benefits related to stock compensation.

Business Segments

The following is detail of business segment results for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. Segment profitability is defined as operating profit (loss). Segment margin represents segment operating profit (loss) expressed as a percentage of segment net sales. For reconciliations of segment net sales and earnings to our consolidated results, see “Note 11 — Segment Information,” of our Unaudited Condensed Consolidated