Table of Contents
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
Form 10-Q

 
 
 
☑
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 30, 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:
01-14010
 
 
Waters Corporation
(Exact name of registrant as specified in its charter)
 
 
 
Delaware
 
13-3668640
(State or other jurisdiction of
incorporation or organization)
  
(I.R.S. Employer
Identification No.)
34 Maple Street
Milford, Massachusetts 01757
(Address, including zip code, of principal executive offices)
(
508) 478-2000
(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, par value $0.01 per share
 
WAT
 
New York Stock Exchange
, Inc.
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, a 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 Act). Yes ☐ No ☑
Indicate the number of shares outstanding of the registrant’s common stock as of
May 3
, 2024: 59,319,699
 
 
 

Table of Contents

WATERS CORPORATION AND SUBSIDIARIES

QUARTERLY REPORT ON FORM 10-Q

INDEX

 

PART I   FINANCIAL INFORMATION    Page  

Item 1.

   Financial Statements   
 

Consolidated Balance Sheets (unaudited) as of March 30, 2024 and December 31, 2023

      3  
 

Consolidated Statements of Operations (unaudited) for the three months ended March 30, 2024 and April 1, 2023

      4  
 

Consolidated Statements of Comprehensive Income (unaudited) for the three months ended March 30, 2024 and April 1, 2023

      5  
 

Consolidated Statements of Cash Flows (unaudited) for the three months ended March 30, 2024 and April 1, 2023

      6  
 

Consolidated Statements of Stockholders’ Equity (unaudited) for the three months ended March 30, 2024 and April 1, 2023

      7  
 

Condensed Notes to Consolidated Financial Statements (unaudited)

      8  

Item 2.

   Management’s Discussion and Analysis of Financial Condition and Results of Operations      23  

Item 3.

   Quantitative and Qualitative Disclosures About Market Risk      31  

Item 4.

   Controls and Procedures      32  

PART II

   OTHER INFORMATION   

Item 1.

   Legal Proceedings      32  

Item 1A.

   Risk Factors      32  

Item 2.

   Unregistered Sales of Equity Securities and Use of Proceeds      32  

Item 5.

   Other Information      33  

Item 6.

   Exhibits      34  
  Signature      35  

Table of Contents
Item 1: Financial Statements
WATERS CORPORATION AND
SU
BSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited)
 
 
  
March 30, 2024
 
 
December 31, 2023
 
 
  
 
 
 
 
 
 
  
(In thousands, except per share data)
 
ASSETS
   
Current assets:
     
Cash and cash equivalents
    $ 337,290     $ 395,076  
Investments
      923       898  
Accounts receivable, net
      626,329       702,168  
Inventories
      538,634       516,236  
Other current assets
      139,782       138,489  
  
 
 
    
 
 
  
Total current assets
      1,642,958       1,752,867  
Property, plant and equipment, net
      633,594       639,073  
Intangible assets, net
      611,147       629,187  
Goodwill
      1,297,826       1,305,446  
Operating lease assets
      81,065       84,591  
Other assets
      242,374       215,690  
  
 
 
    
 
 
  
Total assets
    $ 4,508,964     $ 4,626,854  
  
 
 
    
 
 
  
LIABILITIES AND STOCKHOLDERS’ EQUITY
     
Current liabilities:
     
Notes payable and debt
    $ 50,000     $ 50,000  
Accounts payable
      86,219       84,705  
Accrued employee compensation
      65,098       69,391  
Deferred revenue and customer advances
      336,718       256,675  
Current operating lease liabilities
      26,879       27,825  
Accrued income taxes
      120,520       120,257  
Accrued warranty
      10,853       12,050  
Other current liabilities
      152,172       168,677  
  
 
 
    
 
 
  
Total current liabilities
      848,459       789,580  
Long-term liabilities:
     
Long-term debt
      2,005,761       2,305,513  
Long-term portion of retirement benefits
      48,977       47,559  
Long-term income tax liabilities
      137,439       137,123  
Long-term operating lease liabilities
      55,927       58,926  
Other long-term liabilities
      155,876       137,812  
  
 
 
    
 
 
  
Total long-term liabilities
      2,403,980       2,686,933  
  
 
 
    
 
 
  
Total liabilities
      3,252,439       3,476,513  
Commitments and contingencies (Notes 6, 7 and 9)
     
Stockholders’ equity:
     
Preferred stock, par value $0.01 per share, 5,000 shares authorized, none issued at March 30, 2024 and December 31, 2023
      —        —   
Common stock, par value $0.01 per share, 400,000 shares authorized, 162,882 and 162,709 shares issued, 59,310 and 59,176 shares outstanding at March 30, 2024 and December 31, 2023, respectively
      1,629       1,627  
Additional
paid-in
capital
      2,291,103       2,266,265  
Retained earnings
      9,253,017       9,150,821  
Treasury stock, at cost, 103,572 and 103,533 shares at March 30, 2024 and December 31, 2023, respectively
      (10,147,341 )      (10,134,252 ) 
Accumulated other comprehensive loss
      (141,883 )      (134,120 ) 
  
 
 
    
 
 
  
Total stockholders’ equity
      1,256,525       1,150,341  
  
 
 
    
 
 
  
Total liabilities and stockholders’ equity
    $ 4,508,964     $ 4,626,854  
  
 
 
    
 
 
  
The accompanying notes are an integral part of the interim consolidated financial statements.
 
3
WATERS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
 
 
  
Three Months Ended
 
 
  
March 30, 2024
 
 
April 1, 2023
 
 
  
 
 
 
 
 
 
  
(In thousands, except per share data)
 
Revenues:
     
Product sales
    $ 376,151     $ 436,457  
Service sales
      260,688       248,217  
  
 
 
    
 
 
  
Total net sales
      636,839       684,674  
Costs and operating expenses:
     
Cost of product sales
      153,182       180,354  
Cost of service sales
      108,604       104,026  
Selling and administrative expenses
      174,536       181,956  
Research and development expenses
      44,595       42,691  
Purchased intangibles amortization
      11,834       1,479  
Litigation provision
      10,242       —   
  
 
 
    
 
 
  
Total costs and operating expenses
      502,993       510,506  
  
 
 
    
 
 
  
Operating income
      133,846       174,168  
Other income, net
      2,259       1,388  
Interest expense
      (25,520 )      (14,444 ) 
Interest income
      4,271       4,061  
  
 
 
    
 
 
  
Income before income taxes
      114,856       165,173  
Provision for income taxes
      12,660       24,250  
  
 
 
    
 
 
  
Net income
    $ 102,196     $ 140,923  
  
 
 
    
 
 
  
Net income per basic common share
    $ 1.73     $ 2.39  
Weighted-average number of basic common shares
      59,232       59,023  
Net income per diluted common share
    $ 1.72     $ 2.38  
Weighted-average number of diluted common shares and equivalents
      59,431       59,317  
The accompanying notes are an integral part of the interim consolidated financial statements.
 
4
WATERS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
 
    
Three Months Ended
  
    
March 30, 2024
    
April 1, 2023
  
    
(In thousands)
  
Net income
    $ 102,196     $ 140,923  
Other comprehensive (loss) income:
     
Foreign currency translation
      (9,540 )      8,783  
Unrealized gains on derivative instruments before reclassifications
      2,405       —   
Amounts reclassified to interest income
      (297 )      —   
  
 
 
    
 
 
  
Unrealized gains on derivative instruments before income taxes
      2,108       —   
Income tax expense
      (506 )      —   
  
 
 
    
 
 
  
Unrealized gains on derivative instruments, net of tax
      1,602       —   
Retirement liability adjustment before reclassifications
      332       80  
Amounts reclassified to other income
      (117 )      (83 ) 
  
 
 
    
 
 
  
Retirement liability adjustment before income taxes
      215       (3 ) 
Income tax expense
      (40 )      (4 ) 
  
 
 
    
 
 
  
Retirement liability adjustment, net of tax
      175       (7 ) 
Other comprehensive (loss) income
      (7,763 )      8,776  
  
 
 
    
 
 
  
Comprehensive income
    $ 94,433     $ 149,699  
  
 
 
    
 
 
  
The accompanying notes are an integral part of the
interim
consolidated financial statements.
 
5
WATERS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
 
    
Three Months Ended
  
    
March 30, 2024
    
April 1, 2023
  
Cash flows from operating activities:
   
(In thousands)
Net income
    $ 102,196     $ 140,923  
Adjustments to reconcile net income to net cash provided by operating activities:
     
Stock-based compensation
      10,913       12,805  
Deferred income taxes
      4,453       (5,078 ) 
Depreciation
      22,129       19,411  
Amortization of intangibles
      26,385       11,743  
Change in operating assets and liabilities:
     
Decrease in accounts receivable
      62,592       44,047  
Increase in inventories
      (28,309 )      (42,621 ) 
Increase in other current assets
      (4,707 )      (2,123 ) 
D
ecrease in other assets
      7,369       6,662  
Decrease in accounts payable and other current liabilities
      (18,418 )     (71,257 ) 
Increase in deferred revenue and customer advances
      85,901       77,206  
(Decrease)
 
i
ncrease in other liabilities
      (7,634 )     5,033  
  
 
 
    
 
 
  
Net cash provided by operating activities
      262,870       196,751  
Cash flows from investing activities:
     
Additions to property, plant, equipment and software capitalization
      (28,655 )      (34,390 ) 
Investments in unaffiliated companies
      (1,064 )      —   
Purchases of investments
      (923 )      (893 ) 
Maturities and sales of investments
      898       877  
  
 
 
    
 
 
  
Net cash used in investing activities
      (29,744 )      (34,406 ) 
Cash flows from financing activities:
     
Proceeds from debt issuances
      —        50,040  
Payments on debt
      (300,000 )      (145,000 ) 
Proceeds from stock plans
      13,932       2,378  
Purchases of treasury shares
      (13,089 )      (69,505 ) 
Proceeds from derivative contracts
      6,981       2,876  
  
 
 
    
 
 
  
Net cash used in financing activities
      (292,176 )      (159,211 ) 
Effect of exchange rate changes on cash and cash equivalents
     
1,264
 
 
 
2,407
  
  
 
 
    
 
 
  
(Decrease) increase in cash and cash equivalents
      (57,786 )      5,541  
Cash and cash equivalents at beginning of period
     
395,076
 
 
 
480,529
  
  
 
 
    
 
 
  
Cash and cash equivalents at end of period
    $ 337,290     $ 486,070  
  
 
 
    
 
 
  
The accompanying notes are an integral part of the interim consolidated financial statements.
 
6
WATERS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(unaudited, in thousands)

 
    
Number
of
Common
Shares
     
Common
Stock
     
Additional
Paid-In

Capital
     
Retained
Earnings
     
Treasury

Stock
    
Accumulated
Other
Comprehensive
Loss
    
Total
Stockholders’
Equity
  
Balance December 31, 2022
  
 
162,425
 
  
$
1,624
 
  
$
2,199,824
 
  
$
8,508,587
 
  
$
(10,063,975
) 
 
$
(141,572
) 
 
$
504,488
 
Net income
  
 
— 
 
  
 
— 
 
  
 
— 
 
  
 
140,923
 
  
 
— 
 
 
 
— 
 
 
 
140,923
 
Other comprehensive income
  
 
— 
 
  
 
— 
 
  
 
— 
 
  
 
— 
 
  
 
— 
 
 
 
8,776
 
 
 
8,776
 
Issuance of common stock for employees:
  
  
  
  
  
 
 
Employee Stock Purchase Plan
  
 
8
 
  
 
— 
 
  
 
2,000
 
  
 
— 
 
  
 
— 
 
 
 
— 
 
 
 
2,000
 
Stock options exercised
  
 
6
 
  
 
—
 
 
  
 
969
 
  
 
— 
 
  
 
— 
 
 
 
— 
 
 
 
969
 
Treasury stock
  
 
— 
 
  
 
— 
 
  
 
— 
 
  
 
— 
 
  
 
(69,505
) 
 
 
— 
 
 
 
(69,505
) 
Stock-based compensation
  
 
111
 
  
 
2
 
  
 
12,170
 
  
 
— 
 
  
 
— 
 
 
 
— 
 
 
 
12,172
 
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
    
 
 
    
 
 
  
Balance April 1, 2023
  
 
162,550
 
  
$
1,626
 
  
$
2,214,963
 
  
$
8,649,510
 
  
$
(10,133,480
) 
 
$
(132,796
) 
 
$
599,823
 
  
 
 
     
 
 
     
 
 
     
 
 
     
 
 
    
 
 
    
 
 
  
    
Number
of
Common
Shares
     
Common
Stock
     
Additional
Paid-In

Capital
     
Retained
Earnings
     
Treasury

Stock
    
Accumulated
Other
Comprehensive
Loss
    
Total
Stockholders’
Equity
  
Balance December 31, 2023
  
 
162,709
 
  
$
1,627
 
  
$
2,266,265
 
  
$
9,150,821
 
  
$
(10,134,252
) 
 
$
(134,120
) 
 
$
1,150,341
 
Net income
  
 
— 
 
  
 
— 
 
  
 
— 
 
  
 
102,196
 
  
 
— 
 
 
 
— 
 
 
 
102,196
 
Other comprehensive loss
  
 
— 
 
  
 
— 
 
  
 
— 
 
  
 
— 
 
  
 
— 
 
 
 
(7,763
) 
 
 
(7,763
) 
Issuance of common stock for employees:
  
  
  
  
  
 
 
Employee Stock Purchase Plan
  
 
8
 
  
 
— 
 
  
 
1,996
 
  
 
— 
 
  
 
— 
 
 
 
— 
 
 
 
1,996
 
Stock options exercised
  
 
51
 
  
 
1
 
  
 
12,551
 
  
 
— 
 
  
 
— 
 
 
 
— 
 
 
 
12,552
 
Treasury stock
  
 
— 
 
  
 
— 
 
  
 
— 
 
  
 
— 
 
  
 
(13,089
) 
 
 
— 
 
 
 
(13,089
) 
Stock-based compensation
  
 
114
 
  
 
1
 
  
 
10,291
 
  
 
— 
 
  
 
— 
 
 
 
— 
 
 
 
10,292
 
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
    
 
 
    
 
 
  
Balance March 30, 2024
  
 
162,882
 
  
$
1,629
 
  
$
2,291,103
 
  
$
9,253,017
 
  
$
(10,147,341
) 
 
$
(141,883
) 
 
$
1,256,525
 
  
 
 
     
 
 
     
 
 
     
 
 
     
 
 
    
 
 
    
 
 
  
The accompanying notes are an integral part of the consolidated financial statements.
 
7
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1 Basis of Presentation and Summary of Significant Accounting Policies
Waters Corporation (the “Company,” “we,” “our,” or “us”), a global leader in analytical instruments and software, has pioneered innovations in chromatography, mass spectrometry and thermal analysis serving life, materials and food sciences for more than 65 years. The Company primarily designs, manufactures, sells and services high-performance liquid chromatography (“HPLC”), ultra-performance liquid chromatography (“UPLC” and together with HPLC, referred to as “LC”) and mass spectrometry (“MS”) technology systems and support products, including chromatography columns, other consumable products and comprehensive post-warranty service plans. These systems are complementary products that are frequently employed together
(“LC-MS”)
and sold as integrated instrument systems using common software platforms. LC is a standard technique and is utilized in a broad range of industries to detect, identify, monitor and measure the chemical, physical and biological composition of materials, and to purify a full range of compounds. MS technology, principally in conjunction with chromatography, is employed in drug discovery and development, including clinical trial testing, the analysis of proteins in disease processes (known as “proteomics”), nutritional safety analysis and environmental testing.
LC-MS
instruments combine a liquid phase sample introduction and separation system with mass spectrometric compound identification and quantification. In addition, the Company designs, manufactures, sells and services thermal analysis, rheometry and calorimetry instruments through its TA Instruments product line. These instruments are used in predicting the suitability and stability of fine chemicals, pharmaceuticals, water, polymers, metals and viscous liquids for various industrial, consumer goods and healthcare products, as well as for life science research. The Company is also a developer and supplier of advanced software-based products that interface with the Company’s instruments, as well as other manufacturers’ instruments.
On May 16, 2023, the Company completed the acquisition of Wyatt Technology, LLC and its three operating subsidiaries, Wyatt Technology Europe GmbH, Wyatt Technology France and Wyatt Technology UK Ltd. (collectively, “Wyatt”), for a total purchase price of $1.3 
billion in cash. Wyatt is a pioneer in innovative light scattering and field-flow fractionation instruments, software, accessories and services. The acquisition will expand Waters’ portfolio and increase exposure to large molecule applications. The Company financed this transaction with a combination of cash on its balance sheet and borrowings under its Credit Facility (as defined below). The Company’s financial results for the three months ended March 30, 2024 include the financial results of Wyatt. The Company’s financial results for the three months ended April 1, 2023 do not include any of the financial results of Wyatt since the closing of the Wyatt acquisition occurred in the second fiscal quarter of 2023. In addition, the Company has completed the purchase price allocation for the Wyatt acquisition and there were no material changes as compared to the Company’s preliminary purchase price allocation for the Wyatt acquisition.
The Company’s interim fiscal quarter typically ends on the thirteenth Saturday of each quarter. Since the Company’s fiscal year end is December 31, the first and fourth fiscal quarters may have more or less than thirteen complete weeks. The Company’s first fiscal quarters for 2024 and 2023 ended on March 30, 2024 and April 1, 2023, respectively.
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with the instructions in Form
10-Q
and do not include all of the information and footnote disclosures required for annual financial statements prepared in accordance with generally accepted accounting principles (“U.S. GAAP”) in the United States of America. The consolidated financial statements include the accounts of the Company and its subsidiaries, all of which are wholly owned. All inter-company balances and transactions have been eliminated.
The preparation of consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent liabilities at the dates of the financial statements. Actual amounts may differ from these estimates under different assumptions or conditions.
It is management’s opinion that the accompanying interim consolidated financial statements reflect all adjustments (which are normal and recurring) that are necessary for a fair statement of the results for the interim periods. The interim consolidated financial statements should be read in conjunction with the consolidated financial statements included in the Company’s Annual Report on Form
10-K
for the year ended December 31, 2023, as filed with the U.S. Securities and Exchange Commission (“SEC”) on February 27, 2024.
 
8
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
 
Risks and Uncertainties
The Company is subject to risks common to companies in the analytical instrument industry, including, but not limited to, global economic and financial market conditions, fluctuations in foreign currency exchange rates, fluctuations in customer demand, development by its competitors of new technological innovations, costs of developing new technologies, levels of debt and debt service requirements, risk of disruption, dependence on key personnel, protection and litigation of proprietary technology, shifts in taxable income between tax jurisdictions and compliance with regulations of the U.S. Food and Drug Administration and similar foreign regulatory authorities and agencies.
Translation of Foreign Currencies
The functional currency of each of the Company’s foreign operating subsidiaries is the local currency of its country of domicile, except for the Company’s subsidiaries in Hong Kong, Singapore and the Cayman Islands, where the underlying transactional cash flows are denominated in currencies other than the respective local currency of domicile. The functional currency of the Hong Kong, Singapore and Cayman Islands subsidiaries is the U.S. dollar, based on the respective entity’s cash flows.
For the Company’s foreign operations, assets and liabilities are translated into U.S. dollars at exchange rates prevailing on the balance sheet date, while revenues and expenses are translated at average exchange rates prevailing during the respective period. Any resulting translation gains or losses are included in accumulated other comprehensive loss in the consolidated balance sheets.
Cash, Cash Equivalents and Investments
Cash equivalents represent highly liquid investments, with original maturities of 90 days or less, while investments with longer maturities are classified as investments. The Company maintains cash balances in various operating accounts in excess of federally insured limits, and in foreign subsidiary accounts in currencies other than the U.S. dollar. As of March 30, 2024 and December 31, 2023, $305 million out of $338 million and $321 million out of $396 million, respectively, of the Company’s total cash, cash equivalents and investments were held by foreign subsidiaries. In addition, $239 million out of $338 million and $233 million out of $396 million of cash, cash equivalents and investments were held in currencies
other
than the U.S. dollar at March 30, 2024 and December 31, 2023, respectively.
Accounts Receivable and Allowance for Credit Losses
Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The Company has very limited use of rebates and other cash considerations payable to customers and, as a result, the transaction price determination does not have any material variable consideration. The Company does not consider there to be significant concentrations of credit risk with respect to trade receivables due to the short-term nature of the balances, the Company having a large and diverse customer base, and the Company having a strong historical experience of collecting receivables with minimal defaults. As a result, credit risk is considered low across territories and trade receivables are considered to be a single class of financial asset. The allowance for credit losses is based on a number of factors and is calculated by applying a historical loss rate to trade receivable aging balances to estimate a general reserve balance along with an additional adjustment for any specific receivables with known or anticipated issues affecting the likelihood of recovery. Past due balances with a probability of default based on historical data as well as relevant available forward-looking information are included in the specific adjustment. The historical loss rate is reviewed on at least an annual basis and the allowance for credit losses is reviewed quarterly for any required adjustments. The Company does not have any
off-balance
sheet credit exposure related to its customers.
Trade receivables related to instrument sales are collateralized by the instrument that is sold. If there is a risk of default related to a receivable that is collateralized, then the fair value of the collateral is calculated and adjusted for the cost to
re-possess,
refurbish and
re-sell
the instrument. This adjusted fair value is compared to the receivable balance and the difference would be recorded as the expected credit loss.
 
9
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (
Continued
)
 
The following is a summary of the activity of the Company’s allowance for credit losses for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
 
 
  
Balance at
Beginning of
Period
 
  
Additions
 
  
Deductions and
Other
 
  
Balance at End
of Period
 
Allowance for Credit Losses
            
March 30, 2024
    $ 19,335      $ 991      $ (5,461 )    $ 14,865  
April 1, 2023
    $ 14,311      $ 1,572      $ (1,028 )     $ 14,855  
Fair Value Measurements
In accordance with the accounting standards for fair value measurements and disclosures, certain of the Company’s assets and liabilities are measured at fair value on a recurring basis as of March 30, 2024 and December 31, 2023. Fair values determined by Level 1 inputs utilize observable data, such as quoted prices in active markets. Fair values determined by Level 2 inputs utilize data points other than quoted prices in active markets that are observable either directly or indirectly. Fair values determined by Level 3 inputs utilize unobservable data points for which there is little or no market data, which require the reporting entity to develop its own assumptions.
The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis at March 30, 2024 (in thousands):
 
 
  
Total at
March 30,
2024
 
  
Quoted Prices
in Active
Markets

for Identical
Assets

(Level 1)
 
  
Significant
Other
Observable
Inputs
(Level 2)
 
  
Significant
Unobservable
Inputs

(Level 3)
 
Assets:
  
  
  
  
Time deposits
    $ 923      $ —       $ 923      $ —   
Waters 401(k) Restoration Plan assets
      30,791        30,791        —         —   
Interest rate cross-currency swap agreements
      7,642        —         7,642        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 39,356      $ 30,791      $ 8,565      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Liabilities:
            
Foreign currency exchange contracts
    $ 75      $ —       $ 75      $ —   
Interest rate cross-currency swap agreements
      5,510        —         5,510        —   
Interest rate swap cash flow hedge
      865        —         865        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 6,450      $ —       $ 6,450      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
 
10
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (
Continued
)
 
The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis at December 31, 2023 (in thousands):
 
  
Total at
December 31,
2023
 
  
Quoted Prices
in Active
Markets

for Identical
Assets

(Level 1)
 
  
Significant
Other
Observable
Inputs
(Level 2)
 
  
Significant
Unobservable
Inputs

(Level 3)
 
Assets:
  
  
  
  
Time deposits
    $ 898      $ —       $ 898      $ —   
Waters 401(k) Restoration Plan assets
      28,995        28,995        —         —   
Foreign currency exchange contracts
      183        —         183        —   
Interest rate cross-currency swap agreements
      4,835        —         4,835        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 34,911      $ 28,995      $ 5,916      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Liabilities:
            
Foreign currency exchange contracts
      207        —         207        —   
Interest rate cross-currency swap agreements
      13,384        —         13,384        —   
Interest rate swap cash flow hedge
      2,974        —         2,974        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 16,565      $ —       $ 16,565      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Fair Value of 401(k) Restoration Plan Assets
The 401(k) Restoration Plan is a nonqualified defined contribution plan and the assets were held in registered mutual funds and have been classified as Level 1. The fair values of the assets in the plan are determined through market and observable sources from daily quoted prices on nationally recognized securities exchanges.
Fair Value of Cash Equivalents, Investments, Foreign Currency Exchange Contracts, Interest Rate Cross-Currency Swap Agreements and Interest Rate Swap Cash Flow Hedges
The fair values of the Company’s cash equivalents, investments, foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap cash flow hedges are determined through market and observable sources and have been classified as Level 2. These assets and liabilities have been initially valued at the transaction price and subsequently valued, typically utilizing third-party pricing services. The pricing services use many inputs to determine value, including reportable trades, benchmark yields, credit spreads, broker/dealer quotes, current spot rates and other industry and economic events. The Company validates the prices provided by third-party pricing services by reviewing their pricing methods and obtaining market values from other pricing sources.
Fair Value of Other Financial Instruments
The Company’s accounts receivable and accounts payable are recorded at cost, which approximates fair value due to their short-term nature. The carrying value of the Company’s variable interest rate debt approximates fair value due to the variable nature of the interest rate. The carrying value of the Company’s fixed interest rate debt was $1.3 billion at both March 30, 2024 and December 31, 2023. The fair value of the Company’s fixed interest rate debt was estimated using discounted cash flow models, based on estimated current rates offered for similar debt under current market conditions for the Company. The fair value of the Company’s fixed interest rate debt was estimated to be $1.2 billion at both March 30, 2024 and December 31, 2023, using Level 2 inputs.
Derivative Transactions
The Company is a global company that operates in over 35 countries and, as a result, the Company’s net sales, cost of sales, operating expenses and balance sheet amounts are significantly impacted by fluctuations in foreign currency exchange rates. The Company is exposed to currency price risk on foreign currency exchange rate fluctuations when it translates its
non-U.S.
dollar foreign subsidiaries’ financial statements into U.S. dollars and when any of the Company’s subsidiaries purchase or sell products or services in a currency other than its own
currency.
 
11
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)
 
The Company’s principal strategies in managing exposures to changes in foreign currency exchange rates are to (1) naturally hedge the foreign-currency-denominated liabilities on the Company’s balance sheet against corresponding assets of the same currency, such that any changes in liabilities due to fluctuations in foreign currency exchange rates are typically offset by corresponding changes in assets and (2) mitigate foreign exchange risk exposure of international operations by hedging the variability in the movement of foreign currency exchange rates on a portion of its euro-denominated and
yen-denominated
net asset investments. The Company presents the derivative transactions in financing activities in the statement of cash flows.
Foreign Currency Exchange Contracts
The Company does not specifically enter into any derivatives that hedge foreign-currency-denominated operating assets, liabilities or commitments on its balance sheet, other than a portion of certain third-party accounts receivable and accounts payable, and the Company’s net worldwide intercompany receivables and payables, which are eliminated in consolidation. The Company periodically aggregates its net worldwide balances by currency and then enters into foreign currency exchange contracts that mature within 90 days to hedge a portion of the remaining balance to minimize some of the Company’s currency price risk exposure. The foreign currency exchange contracts are not designated for hedge accounting treatment. Principal hedged currencies include the euro, Japanese yen, British pound, Mexican peso and Brazilian real.
Cash Flow Hedges
The Company’s Credit Facility is a variable borrowing and has interest payments based on a contractually specified interest rate index. The contractually specified index on the Credit Facility is the
3-month
Term SOFR. The variable rate interest payments create interest risk for the Company as interest payments will fluctuate based on changes in the contractually specified interest rate index over the life of the Credit Facility. In order to reduce interest rate risk, the Company enters into interest rate swaps that will effectively
lock-in
the forecasted interest payments on the variable rate borrowing over its term. The interest rate swaps represent cash flow hedges and are assessed for hedge effectiveness each reporting period. When the hedge relationship is highly effective at achieving offsetting changes in cash flows, the Company will record the entire change in fair value of the interest rate swaps in accumulated other comprehensive loss. The amount in accumulated other comprehensive loss is reclassified to income in the period that the underlying transaction impacts consolidated income. If it becomes probable that the forecasted transaction will not occur, the hedge relationship will be
de-designated
and amounts accumulated in other comprehensive loss will be reclassified to income in the current period. Interest settlements due to benchmark interest rate changes are recorded in interest income or interest expense. For the three months ended March 30, 2024, the Company did not have any cash flow hedges that were deemed ineffective.
Interest Rate Cross-Currency Swap Agreements
As of March 30, 2024, the Company had entered into interest rate cross-currency swap derivative agreements with durations up to three years with an aggregate notional value of $625 million to hedge the variability in the movement of foreign currency exchange rates on a portion of its euro-denominated and
yen-denominated
net asset investments. Under hedge accounting, the change in fair value of the derivative that relates to changes in the foreign currency spot rate are recorded in the currency translation adjustment in other comprehensive income and remain in accumulated other comprehensive loss in stockholders’ equity until the sale or substantial liquidation of the foreign operation. The difference between the interest rate received and paid under the interest rate cross-currency swap derivative agreement is recorded in interest income in the statement of operations.
 
12
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)
 
The Company’s foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap agreements designated as cash flow hedges are included in the consolidated balance sheets are classified as follows (in thousands):
                                 
 
  
March 30, 2024
 
  
December 31, 2023
 
 
  
Notional
 
  
Fair Value
 
  
Notional
 
  
Fair Value
 
Foreign currency exchange contracts:
  
      
  
      
  
      
  
      
Other current assets
    $ 5,000      $ —       $ 24,155      $ 183  
Other current liabilities
    $ 35,314      $ 75      $ 16,000      $ 207  
Interest rate cross-currency swap agreements:
            
Other assets
    $ 285,000      $ 7,642      $ 220,000      $ 4,835  
Other liabilities
    $ 340,000      $ 5,510      $ 405,000      $ 13,384  
Accumulated other comprehensive income (loss)
       $ 6,942         $ (7,975 ) 
Interest rate swap cash flow hedges:
            
Other liabilities
    $ 100,000      $ 865      $ 100,000      $ 2,974  
Accumulated other comprehensive loss
       $ (865 )        $ (2,974 ) 
The following is a summary of the activity included in the consolidated statements of operations and statements of comprehensive income related to the foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap agreements designated as cash flow hedges (in thousands):

    
Financial

Statement
Classification
   
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Foreign currency exchange contracts:
      
Realized gains on closed contracts
    Cost of sales    $ 257      $ 30  
Unrealized losses on open contracts
    Cost of sales      (51 )       (78 ) 
     
 
 
     
 
 
  
Cumulative net
pre-tax
gains (losses)
    Cost of sales    $ 206      $ (48 ) 
     
 
 
     
 
 
  
Interest rate cross-currency swap agreements:
      
Interest earned
    Interest income    $ 2,537      $ 2,655  
Unrealized gains (losses) on contracts, net
    Accumulated other
comprehensive loss		    $ 14,917      $ (7,256 ) 
Interest rate swap cash flow hedges:
      
Interest earned
    Interest income    $ 296      $ —   
Unrealized gains on
    Accumulated other      
open contracts
    comprehensive loss    $ 2,109      $ —   
 
13
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)

Stockholders’ Equity
In December 2023, the Company’s Board of Directors authorized the extension of its existing share repurchase program through January 21, 2025. The Company’s remaining authorization is $1.0 billion. During the three months ended April 1, 2023, the Company
 
repurchased 0.2 
million shares of the Company’s outstanding common stock at a cost of
$58 
million under the Company’s share repurchase program. The Company did not make any open market share repurchases in 2024. In addition, the Company repurchased
$13 million and $11 million of common stock related to the vesting of restricted stock units during the three months ended March 30, 2024 and April 1, 2023, respectively.
 
14
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)
 
Product Warranty Costs
The Company accrues estimated product warranty costs at the time of sale, which are included in cost of sales in the consolidated statements of operations. While the Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers, the Company’s warranty obligation is affected by product failure rates, material usage and service delivery costs incurred in correcting a product failure. The amount of the accrued warranty liability is based on historical information, such as past experience, product failure rates, number of units repaired and estimated costs of material and labor. The liability is reviewed for reasonableness at least quarterly.
The following is a summary of the activity of the Company’s accrued warranty liability for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Balance at
Beginning
of Period
     
Accruals for
Warranties
     
Settlements
Made
     
Balance at
End of
Period
  
Accrued warranty liability:
            
March 30, 2024
    $ 12,050      $ 480      $ (1,677 )     $ 10,853  
April 1, 2023
    $ 11,949      $ 2,177      $ (1,815 )     $ 12,311  
Restructuring
In March 2024, the Company had a reduction in workforce that impacted approximately 2% of the employees, primarily in China due to the significant decline in sales resulting from lower customer demand, which resulted in the Company incurring approximately $8 million of severance-related costs. During the first quarter of 2024, the Company paid $8 
million of severance-related costs in connection with the workforce reductions that occurred in March 2024 and July 2023, with the majority of the remaining costs to be paid in the second quarter of 2024. The accrued restructuring expense was $8 million at both March 30, 2024 and December 31, 2023 and were included in other current liabilities on the consolidated balance sheets.
2 Revenue Recognition
The Company’s deferred revenue liabilities in the consolidated balance sheets consist of the obligation on instrument service contracts and customer payments received in advance, prior to transfer of control of the instrument. The Company records deferred revenue primarily related to its service contracts, where consideration is billable at the beginning of the service period.
The following is a summary of the activity of the Company’s deferred revenue and customer advances for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
March 30, 2024
     
April 1, 2023
  
Balance at the beginning of the period
    $ 323,516      $ 285,175  
Recognition of revenue included in balance at beginning of the period
      (103,996 )       (105,222 ) 
Revenue deferred during the period, net of revenue recognized
      187,525        193,286  
  
 
 
     
 
 
  
Balance at the end of the period
    $ 407,045      $ 373,239  
  
 
 
     
 
 
  
The Company classified $70 million and $67 million of deferred revenue and customer advances in other long-term liabilities at March 30, 2024 and December 31, 2023, respectively.
 
15
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)
 
The amount of deferred revenue and customer advances equals the transaction price allocated to unfulfilled performance obligations for the period presented. Such amounts are expected to be recognized in the future as follows (in thousands):
 
    
March 30, 2024
  
Deferred revenue and customer advances expected to be recognized in:
   
One year or less
    $ 336,718  
13-24
months
      42,162  
25 months and beyond
      28,165  
  
 
 
  
Total
    $ 407,045  
  
 
 
  
3 Marketable Securities
The Company’s marketable securities within cash equivalents and investments included in the consolidated balance sheets consist of time deposits that mature in one year or less with an amortized cost and a fair value of $0.9 million at both March 30, 2024 and December 31, 2023.
4 Inventories
Inventories are classified as follows (in thousands):
 
    
March 30, 2024
     
December 31, 2023
  
Raw materials
    $ 241,744      $ 233,952  
Work in progress
      23,825        20,198  
Finished goods
      273,065        262,086  
  
 
 
     
 
 
  
Total inventories
    $ 538,634      $ 516,236  
  
 
 
     
 
 
  
5 Goodwill and Other Intangibles
The carrying amount of goodwill was $1.3 billion at both March 30, 2024 and December 31, 2023.
The Company’s intangible assets included in the consolidated balance sheets are detailed as follows (dollars in thousands):

 
  
March 30, 2024
 
  
December 31, 2023
 
 
  
Gross
Carrying
Amount
 
  
Accumulated
Amortization
 
  
Weighted-
Average
Amortization
Period
 
  
Gross
Carrying
Amount
 
  
Accumulated
Amortization
 
  
Weighted-
Average
Amortization
Period
 
Capitalized software
    $ 655,433      $ 495,177        5 years      $ 660,273      $ 495,317        5
 
years		  
Purchased intangibles
      612,382        207,620        10 years        614,357        197,154        10 years  
Trademarks
      9,680        —         —         9,680        —         —   
Licenses
      14,673        8,698        7 years        14,798        8,429        7 years  
Patents and other intangibles
      113,028        82,554        8 years        111,962        80,983        8 years  
  
 
 
     
 
 
        
 
 
     
 
 
     
Total
    $ 1,405,196      $ 794,049        7 years      $ 1,411,070      $ 781,883        7 years  
  
 
 
     
 
 
        
 
 
     
 
 
     
The Company capitalized $10 million and $14 million of intangible assets in the three months ended March 30, 2024 and April 1, 2023, respectively. The gross carrying value of intangible assets and accumulated amortization for intangible assets decreased by $16 million and $14 million, respectively, in the three months ended March 30, 2024 due to the effects of foreign currency translation. Amortization expense for intangible assets was $26 million and $12 million for the three months ended March 30, 2024 and April 1, 2023, respectively. Amortization expense for intangible assets is estimated to be $108 million per year for each of the next five years.
 
16
CONDENSED
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)
 
6 Debt
The Company has a five-year, $2.0 
billion revolving credit facility (the “Credit Facility”) that matures in September 2026. As of March 30, 2024 and December 31, 2023, the Credit Facility had a total
 of $0.8 billion and $1.1 billion outstanding, respectively.
The interest rates applicable under the Credit Facility are, at the Company’s option, equal to either the alternate base rate (which is a rate per annum equal to the greatest of (1) the prime rate in effect on such day, (2) the Federal Reserve Bank of New York Rate on such day plus 1⁄2 of 1% per annum and (3) the adjusted Term SOFR rate for a one-month interest period as published two U.S. Government Securities Business Days prior to such day (or if such day is not a U.S. Government Securities Business Day, the immediately preceding U.S. Government Securities Business Day), plus 1% annum) or the applicable 1, 3 or 6 month adjusted Term SOFR or EURIBO rate for euro-denominated loans, in each case, plus an interest rate margin based upon the Company’s leverage ratio, which can range between 0 and 12.5 basis points for alternate base rate loans and between 80 and 112.5 basis points for Term SOFR or EURIBO rate loans. The facility fee on the Credit Facility ranges between 7.5 and 25 basis points per annum, based on the leverage ratio, of the amount of the revolving facility commitments and the outstanding term loan. The Credit Facility requires that the Company comply with an interest coverage ratio test of not less than 3.50:1 as of the end of any fiscal quarter for any period of four consecutive fiscal quarters and a leverage ratio test of not more than 3.50:1 as of the end of any fiscal quarter. In addition, the Credit Facility includes negative covenants, affirmative covenants, representations and warranties and events of default that are customary for investment grade credit facilities.
As of both March 30, 2024 and December 31, 2023, the Company had a total of $1.3 billion of outstanding senior unsecured notes. Interest on the fixed rate senior unsecured notes is payable semi-annually each year. Interest on the floating rate senior unsecured notes is payable quarterly. The Company may prepay all or some of the senior unsecured notes at any time in an amount not less than 10% of the aggregate principal amount outstanding. In the event of a change in control of the Company (as defined in the note purchase agreement), the Company may be required to prepay the senior unsecured notes at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest. These senior unsecured notes require that the Company comply with an interest coverage ratio test of not less than 3.50:1 for any period of four consecutive fiscal quarters and a leverage ratio test of not more than 3.50:1 as of the end of any fiscal quarter. In addition, these senior unsecured notes include customary negative covenants, affirmative covenants, representations and warranties and events of default.
The Company had the following outstanding debt at March 30, 2024 and December 31, 2023 (in thousands):
 
    
March 30, 2024
     
December 31, 2023
  
Senior unsecured notes - Series G -
3.92
%, due June 2024
      50,000        50,000  
  
 
 
     
 
 
  
Total notes payable and debt, current
      50,000        50,000  
Senior unsecured notes - Series K - 3.44%, due May 2026
      160,000        160,000  
Senior unsecured notes - Series L - 3.31%, due September 2026
      200,000        200,000  
Senior unsecured notes - Series M - 3.53%, due September 2029
      300,000        300,000  
Senior unsecured notes - Series N - 1.68%, due March 2026
      100,000        100,000  
Senior unsecured notes - Series O - 2.25%, due March 2031
      400,000        400,000  
Senior unsecured notes - Series P - 4.91%, due May 2028
      50,000        50,000  
Senior unsecured notes - Series Q - 4.91%, due May 2030
      50,000        50,000  
Credit agreement
      750,000        1,050,000  
Unamortized debt issuance costs
      (4,239 )       (4,487 ) 
  
 
 
     
 
 
  
Total long-term debt
      2,005,761        2,305,513  
  
 
 
     
 
 
  
Total debt
    $ 2,055,761      $ 2,355,513  
  
 
 
     
 
 
  
As of March 30, 2024 and December 31, 2023, the Company had a total amount available to borrow under the Credit Facility of $1.2 billion and $0.9 billion, respectively, after outstanding letters of credit. The weighted-average interest rates applicable to the senior unsecured notes and credit agreement borrowings collectively were 4.42% and 4.69% at March 30, 2024 and December 31, 2023, respectively. As of March 30, 2024, the Company was in compliance with all debt
covenants.
 
17
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)
 
The Company and its foreign subsidiaries also had available short-term lines of credit totaling $112 million and $114 million at March 30, 2024
and
December 31, 2023, respectively, for the purpose of short-term borrowing and issuance of commercial guarantees. None of the Company’s foreign subsidiaries had outstanding short-term borrowings as of March 30, 2024 or December 31, 2023.
7 Income Taxes
The four principal jurisdictions in which the Company manufactures are the U.S., Ireland, the U.K. and Singapore, where the statutory tax rates were 21%, 12.5%, 25% and 17%, respectively, as of March 30, 2024. The Company has a Development and Expansion Incentive in Singapore that provides a concessionary income tax rate of 5%
on certain types of income for the period April 1, 2021 through March 31, 2026. The effect of applying the concessionary income tax rate rather than the statutory tax rate to income arising from qualifying activities in Singapore increased the Company’s net income for the three months ended March 30, 2024 and April 1, 2023 by $2 million
and $
3 
million, respectively, and increased the Company’s net income per diluted
 
share by $0.03 and $0.05, respectively.
The Company’s effective tax rate for the three months ended March 30, 2024 and April 1, 2023 was 11.0% and 14.7%, respectively. The income tax provision includes a $1 million and a $2 
million income tax benefit related to stock-based compensation for the three months ended March 30, 2024 and April 1, 2023, respectively. The remaining differences between the effective tax rates can primarily be attributed to the impact of discrete tax benefits in the current year and differences in the proportionate amounts of
pre-tax
income recognized in jurisdictions with different effective tax rates.
The Company accounts for its uncertain tax return positions in accordance with the accounting standards for income taxes, which require financial statement reporting of the expected future tax consequences of uncertain tax reporting positions on the presumption that all concerned tax authorities possess full knowledge of those tax reporting positions, as well as all of the pertinent facts and circumstances, but prohibit any discounting of unrecognized tax benefits associated with those reporting positions for the time value of money. The Company continues to classify interest and penalties related to unrecognized tax benefits as a component of the provision for income taxes.
The Company’s gross unrecognized tax benefits, excluding interest and penalties, at March 30, 2024 and April 1, 2023 were $15 million and $30 
million, respectively. With limited exceptions, the Company is no longer subject to tax audit examinations in significant jurisdictions for the years ended on or before December 31, 2018. The Company continuously monitors the lapsing of statutes of limitations on potential tax assessments for related changes in the measurement of unrecognized tax benefits, related net interest and penalties, and deferred tax assets and liabilities.
Effective in 2024, various foreign jurisdictions began implementing aspects of the guidance issued by the Organization for
Economic Co-operation and
Development related to the new Pillar Two system of global minimum tax rules. These changes in tax law did not have a material impact on the Company’s financial position, results of operations and cash flows for the first quarter of 2024. The Company continues to monitor the adoption of the Pillar Two rules in additional jurisdictions.
8 Litigation
From time to time, the Company and its subsidiaries are involved in various litigation matters arising in the ordinary course of business. The Company believes it has meritorious arguments in its current litigation matters and believes any outcome, either individually or in the aggregate, will not be material to the Company’s financial position, results of operations or cash flows. During the three months ended March 30, 2024, the Company recorded
$10 
million of patent litigation settlement provisions and related costs. The accrued patent litigation expense is in other current liabilities in the consolidated balance sheet at March 30, 2024.
9 Other Commitments and Contingencies
The Company licenses certain technology and software from third parties in the course of ordinary business. Future minimum license fees payable under existing license agreements as of March 30, 2024 are immaterial for the years ended December 31, 2024 and thereafter.

18
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)
 
The Company enters into standard indemnification agreements in its ordinary course of business. Pursuant to these agreements, the Company indemnifies, holds harmless and agrees to reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally the Company’s business partners or customers, in connection with patent, copyright or other intellectual property infringement claims by any third party with respect to its current products, as well as claims relating to property damage or personal injury resulting from the performance of services by the Company or its subcontractors. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited. Historically, the Company’s costs to defend lawsuits or settle claims relating to such indemnity agreements have been minimal and management accordingly believes the estimated fair value of these agreements is immaterial.
10 Earnings Per Share
Basic and diluted EPS calculations are detailed as follows (in thousands, except per share data): 
 
 
  
Three Months Ended March 30, 2024
 
 
  
Net Income
(Numerator)
 
  
Weighted-
Average Shares
(Denominator)
 
  
Per Share
Amount
 
Net income per basic common share
    $ 102,196        59,232      $ 1.73  
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities
      —         199        (0.01 ) 
  
 
 
     
 
 
     
 
 
  
Net income per diluted common share
    $ 102,196        59,431      $ 1.72  
  
 
 
     
 
 
     
 
 
  
 
 
  
Three Months Ended April 1, 2023
 
 
  
Net Income
(Numerator)
 
  
Weighted-
Average Shares
(Denominator)
 
  
Per Share
Amount
 
Net income per basic common share
    $ 140,923        59,023      $ 2.39  
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities
      —         294        (0.01 ) 
  
 
 
     
 
 
     
 
 
  
Net income per diluted common share
    $ 140,923        59,317      $ 2.38  
  
 
 
     
 
 
     
 
 
  
For the three months ended March 30, 2024 and April 1, 2023, the
Company had approximately
 326,000 
and approximately
 140,000 
stock options that were antidilutive, respectively, due to having higher exercise prices than the Company’s average stock price during the applicable period. These securities were not included in the computation of diluted EPS. The effect of dilutive securities was calculated using the treasury stock method.
19
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)
 
11 Accumulated Other Comprehensive Loss
The components of accumulated other comprehensive loss are detailed as follows (in thousands):
 
 
  
Currency
Translation
 
  
Unrealized
Loss on
Retirement
Plans
 
  
Unrealized
Loss on
Derivative
Instruments
 
  
Accumulated
Other
Comprehensive
Loss
 
Balance at December 31, 2023
    $ (128,359 )    $ (3,501 )    $ (2,260 )    $ (134,120 ) 
Other comprehensive income (loss), net of tax
      (9,540 )      175       1,602       (7,763 ) 
  
 
 
    
 
 
    
 
 
    
 
 
  
Balance at March 30, 2024
    $ (137,899 )    $ (3,326 )    $ (658 )    $ (141,883 ) 
  
 
 
    
 
 
    
 
 
    
 
 
  
12 Business Segment Information
The Company’s business activities, for which discrete financial information is available, are regularly reviewed and evaluated by the chief operating decision maker. As a result of this evaluation, the Company determined that it has two operating segments:
Waters
TM
and TA
TM
.
The
 
Waters operating segment is primarily in the business of designing, manufacturing, selling and servicing LC and MS instruments, columns and other precision chemistry consumables that can be integrated and used along with other analytical instruments. Operations of the Wyatt business are part of the Waters operating segment. The TA operating segment is primarily in the business of designing, manufacturing, selling and servicing thermal analysis, rheometry and calorimetry instruments. The Company’s two operating segments have similar economic characteristics; product processes; products and services; types and classes of customers; methods of distribution; and regulatory environments. Because of these similarities, the two segments have been aggregated into
 
one
reporting segment for financial statement purposes.
Net sales for the Company’s products and services are as follows for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Product net sales:
      
Waters instrument systems
    $ 191,259      $ 244,211  
Chemistry consumables
      134,207        133,515  
TA instrument systems
      50,685        58,731  
  
 
 
     
 
 
  
Total product sales
      376,151        436,457  
Service net sales:
      
Waters service
      236,433        224,349  
TA service
      24,255        23,868  
  
 
 
     
 
 
  
Total service sales
      260,688        248,217  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
20
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)
 
Net sales are attributable to geographic areas based on the region of destination. Geographic sales information is presented below for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Net Sales:
      
Asia:
      
China
    $ 85,745      $ 116,065  
Japan
      35,547        46,494  
Asia Other
      86,267        90,522  
  
 
 
     
 
 
  
Total Asia
      207,559        253,081  
Americas:
      
United States
      202,839        202,305  
Americas Other
      38,332        44,116  
  
 
 
     
 
 
  
Total Americas
      241,171        246,421  
Europe
      188,109        185,172  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
Net sales by customer class are as follows for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Pharmaceutical
    $ 374,207      $ 384,898  
Industrial
      195,334        209,650  
Academic and government
      67,298        90,126  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
21
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) – (Continued)
Net sales for the Company recognized at a point in time versus over time are as follows for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Net sales recognized at a point in time:
      
Instrument systems
    $ 241,944      $ 302,942  
Chemistry consumables
      134,207        133,515  
Service sales recognized at a point in time (time & materials)
      83,325        88,207  
  
 
 
     
 
 
  
Total net sales recognized at a point in time
      459,476        524,664  
Net sales recognized over time:
      
Service and software maintenance sales recognized over time (contracts)
      177,363        160,010  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
13 Recent Accounting Standard Changes and Developments
Recently Issued Accounting Standards
There were no additions to the new accounting pronouncements not yet adopted as described in our Annual Report on Form
10-K
for the year ended December 31, 2023. Other amendments to U.S. GAAP that have been issued by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our condensed consolidated financial statements upon adoption.
 
 
22

Table of Contents

Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations

Business Overview

The Company has two operating segments: WatersTM and TATM. Waters products and services primarily consist of high-performance liquid chromatography (“HPLC”), ultra-performance liquid chromatography (“UPLCTM” and, together with HPLC, referred to as “LC”), mass spectrometry (“MS”), light scattering and field-flow fractionation instruments (Wyatt), and precision chemistry consumable products and related services. TA products and services primarily consist of thermal analysis, rheometry and calorimetry instrument systems and service sales. The Company’s products are used by pharmaceutical, biochemical, industrial, nutritional safety, environmental, academic and government customers. These customers use the Company’s products to detect, identify, monitor and measure the chemical, physical and biological composition of materials and to predict the suitability and stability of fine chemicals, pharmaceuticals, water, polymers, metals and viscous liquids in various industrial, consumer goods and healthcare products.

Wyatt Acquisition

On May 16, 2023, the Company completed the acquisition of Wyatt Technology, LLC and its three operating subsidiaries, Wyatt Technology Europe GmbH, Wyatt Technology France and Wyatt Technology UK Ltd. (collectively, “Wyatt”), for a total purchase price of $1.3 billion in cash. Wyatt is a pioneer in innovative light scattering and field-flow fractionation instruments, software, accessories, and services. The acquisition will expand Waters’ portfolio and increase exposure to large molecule applications. The Company financed this transaction with a combination of cash on its balance sheet and borrowings under its revolving credit facility. The Company’s financial results for the three months ended March 30, 2024 include the financial results of Wyatt. The Company’s financial results for the three months ended April 1, 2023 do not include any of the financial results of Wyatt since the closing of the Wyatt acquisition occurred in the second fiscal quarter of 2023.

 

23

Table of Contents

Financial Overview

The Company’s operating results are as follows for the three months ended March 30, 2024 and April 1, 2023 (dollars in thousands, except per share data):

 

     Three Months Ended  
     March 30, 2024     April 1, 2023     % change  

Revenues:

       

Product sales

    $ 376,151     $ 436,457       (14 %) 

Service sales

      260,688       248,217       5 % 
  

 

 

    

 

 

    

 

 

  

Total net sales

      636,839       684,674       (7 %) 

Costs and operating expenses:

       

Cost of sales

      261,786       284,380       (8 %) 

Selling and administrative expenses

      174,536       181,956       (4 %) 

Research and development expenses

      44,595       42,691       4 % 

Purchased intangibles amortization

      11,834       1,479       700 % 

Litigation provision

      10,242       —        * * 
  

 

 

    

 

 

    

 

 

  

Operating income

      133,846       174,168       (23 %) 

Operating income as a % of sales

      21.0 %      25.4 %   

Other income, net

      2,259       1,388       * * 

Interest expense, net

      (21,249 )      (10,383 )      105 % 
  

 

 

    

 

 

    

 

 

  

Income before income taxes

      114,856       165,173       (30 %) 

Provision for income taxes

      12,660       24,250       (48 %) 
  

 

 

    

 

 

    

 

 

  

Net income

    $ 102,196     $ 140,923       (27 %) 
  

 

 

    

 

 

    

 

 

  

Net income per diluted common share

    $ 1.72     $ 2.38       (28 %) 

 

**

Percentage not meaningful

The Company’s net sales decreased 7% in the first quarter of 2024, as compared to the first quarter of 2023, with foreign currency translation decreasing total sales growth by 1%. The decrease in first quarter sales was driven by lower customer demand for our products across most major regions, except for sales in Europe, which increased 2%, and the U.S., which were flat and benefited from Wyatt sales contributions. The decline in customer demand can be attributed to our customers delaying the purchase of our instrument systems as they remained cautious with their capital spending entering 2024. The Wyatt acquisition increased sales growth by 3% for the first quarter of 2024. In addition, the Company’s first quarter of 2024 had one less calendar day than the first quarter of 2023.

Instrument system sales decreased 20% in the first quarter of 2024 primarily driven by weaker customer demand in all regions of the world. The instrument system sales decline was broad-based across all of our instrument systems but especially for our mass spectrometry instrument systems, where the decline was significantly greater. Our mass spectrometry system sales are higher priced instrument systems that are significantly impacted by the timing and level of funding our academic and government customers receive. In addition, the Wyatt acquisition increased instrument system sales growth by 5% in the first quarter of 2024. Foreign currency translation did not impact instrument system sales growth in the first quarter of 2024.

Recurring revenues (combined sales of precision chemistry consumables and services) increased 3% in the first quarter of 2024, with foreign currency translation decreasing sales growth by 1%. Service revenues increased 5% in the first quarter of 2024, with Wyatt contributing 2% to service revenue growth in the quarter. Chemistry sales increased 1% in the first quarter of 2024 and were impacted by the lower customer demand in China for our products. Excluding the impact of China, the Company’s chemistry sales increased 3% in the first quarter of 2024.

Operating income was $134 million in the first quarter of 2024, a decrease of 23% as compared to $174 million in the first quarter of 2023. The decrease in operating income was primarily due to lower sales volume and the increase in the following expenses: Wyatt acquisition-related retention expense and purchased intangible amortization, which added 10%; severance-related costs associated with a workforce reduction primarily in China, which added 5%; and litigation settlement provisions and related costs, which added 6%. These costs were partially offset by a 5% reduction in costs related to the Wyatt acquisition diligence incurred in the first quarter of 2023.

 

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The Company generated $263 million and $197 million of net cash from operating activities in the first three months of 2024 and 2023, respectively, with the $66 million increase being attributable to lower annual incentive bonus payments and an improvement in working capital in the current year. Net cash used in investing activities included capital expenditures related to property, plant, equipment and software capitalization of $29 million and $34 million in the first quarter of 2024 and 2023, respectively.

Results of Operations

Sales by Geography

Geographic sales information is presented below for the three months ended March 30, 2024 and April 1, 2023 (dollars in thousands):

 

     Three Months Ended  
     March 30, 2024      April 1, 2023      % change  

Net Sales:

         

Asia:

         

China

    $ 85,745      $ 116,065        (26 %) 

Japan

      35,547        46,494        (24 %) 

Asia Other

      86,267        90,522        (5 %) 
  

 

 

     

 

 

     

 

 

  

Total Asia

      207,559        253,081        (18 %) 

Americas:

         

United States

      202,839        202,305        —   

Americas Other

      38,332        44,116        (13 %) 
  

 

 

     

 

 

     

 

 

  

Total Americas

      241,171        246,421        (2 %) 

Europe

      188,109        185,172        2 % 
  

 

 

     

 

 

     

 

 

  

Total net sales

    $ 636,839      $ 684,674        (7 %) 
  

 

 

     

 

 

     

 

 

  

Geographically, the Company’s sales decline in the first quarter of 2024 was broad-based across most major regions except for Europe, which increased 2%, and the U.S., which was flat and benefited from Wyatt sales contributions. The decline in sales can be attributed to the lower demand for our instrument systems and chemistry products as customers delayed the purchase of these products. Foreign currency translation decreased sales growth by 3% in Asia and increased sales growth by 2% in Europe in the first quarter of 2024.

Sales by Trade Class

Net sales by customer class are presented below for the three months ended March 30, 2024 and April 1, 2023 (dollars in thousands):

 

     Three Months Ended  
     March 30, 2024      April 1, 2023      % change  

Pharmaceutical

    $ 374,207      $ 384,898        (3 %) 

Industrial

      195,334        209,650        (7 %) 

Academic and government

      67,298        90,126        (25 %) 
  

 

 

     

 

 

     

 

 

  

Total net sales

    $ 636,839      $ 684,674        (7 %) 
  

 

 

     

 

 

     

 

 

  

 

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During the first quarter of 2024, sales to pharmaceutical customers decreased 3%, as growth in Europe and India was offset by weakness across most major regions, with foreign currency translation decreasing pharmaceutical sales growth by 1% and Wyatt contributing 4% to the Company’s pharmaceutical sales growth. Combined sales to industrial customers, which include material characterization, food, environmental and fine chemical markets, decreased 7% in the first quarter of 2024, with foreign currency translation decreasing sales growth by 1% and Wyatt contributing 1% to industrial sales growth.

Sales to our academic and government customers are highly dependent on when institutions receive funding to purchase our instrument systems and, as such, sales can vary significantly from period to period. Our combined sales to academic and government customers decreased 25% in the first quarter of 2024, with foreign currency translation increasing sales by 2% and Wyatt contributing 3% to the Company’s academic and government sales growth. This overall decline in sales of 25% to our academic and government customers in the first quarter of 2024 compares to a 38% increase in academic and government sales in the first quarter of 2023, which represents a two-year compound annual growth rate of 1%.

Waters Products and Services Net Sales

Net sales for Waters products and services were as follows for the three months ended March 30, 2024 and April 1, 2023 (dollars in thousands):

 

     Three Months Ended  
     March 30, 2024      % of
Total		     April 1, 2023      % of
Total		     % change  

Waters instrument systems

    $ 191,259        34 %    $ 244,211        41 %      (22 %) 

Chemistry consumables

      134,207        24 %      133,515        22 %      1 % 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Total Waters product sales

      325,466        58 %      377,726        63 %      (14 %) 

Waters service

      236,433        42 %      224,349        37 %      5 % 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Total Waters net sales

    $ 561,899        100 %    $ 602,075        100 %      (7 %) 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Waters products and service sales decreased 7% in the first quarter of 2024, with the effect of foreign currency translation decreasing sales growth by 1%. The Wyatt acquisition increased Waters products and service sales growth by approximately 4% in the quarter. Waters instrument system sales decreased 22% in the first quarter of 2024 due to weaker customer demand. Waters service sales increased 5% in the first quarter of 2024 due to higher service demand billing in all regions except for China, partially offset by the negative impact from foreign currency translation which decreased service sales growth by 1%.

TA Product and Services Net Sales

Net sales for TA products and services were as follows for the three months ended March 30, 2024 and April 1, 2023 (dollars in thousands):

 

     Three Months Ended  
     March 30, 2024      % of
Total		     April 1, 2023      % of
Total		     % change  

TA instrument systems

    $ 50,685        68 %    $ 58,731        71 %      (14 %) 

TA service

      24,255        32 %      23,868        29 %      2 % 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Total TA net sales

    $ 74,940        100 %    $ 82,599        100 %      (9 %) 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

TA sales declined 9% in the first quarter of 2024 due to lower customer demand for TA products in all regions except for Latin America and India. Foreign currency translation decreased TA sales growth by 1% in the quarter.

Cost of Sales

Cost of sales decreased by 8% in the first quarter 2024, primarily due to lower sales volume, changes in sales mix and lower freight costs. Cost of sales is affected by many factors, including, but not limited to, foreign currency translation, product mix, product costs of instrument systems and amortization of software platforms. At current foreign currency exchange rates, the Company expects foreign currency translation to decrease gross profit during 2024.

 

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Selling and Administrative Expenses

Selling and administrative expenses decreased 4% in the first quarter of 2024 primarily due to the $8 million decline in costs related to the Wyatt acquisition diligence incurred in the first quarter of 2023 and the decrease in salary expense resulting from lower headcount from the reductions in workforce that occurred in March 2024. These decreases were partially offset by the increase of $6 million in Wyatt acquisition-related retention expense and the $8 million increase in severance-related costs in connection with a reduction in workforce. In the first quarter of 2024, the Company had a reduction in workforce, primarily impacting China employees, as result of the significant sales volume decline in China’s sales over the last year. This workforce reduction impacted approximately 2% of the Company’s employees worldwide. The effect of foreign currency translation did not have a significant impact on selling and administrative expenses in the first quarter of 2024.

As a percentage of net sales, selling and administrative expenses were 27.4% and 26.6% for the first quarter of 2024 and 2023, respectively.

Research and Development Expenses

Research and development expenses increased 4% in the first quarter of 2024, primarily driven by costs associated with the development of new product and technology initiatives as well as $2 million in Wyatt acquisition-related retention expense. The impact of foreign currency exchange increased expenses by 3% in the first quarter of 2024.

Purchased Intangibles Amortization

The increase in purchased intangible amortization of $10 million in the first quarter of 2024 can be attributed to the Wyatt acquisition intangible assets.

Litigation Provisions

The Company recorded $10 million of patent litigation settlement provisions and related costs in the first quarter of 2024.

Interest Expense, net

Net interest expense in the first quarter of 2024 increased $11 million, which can be primarily attributed to the additional borrowings by the Company to fund the Wyatt acquisition.

Provision for Income Taxes

The four principal jurisdictions in which the Company manufactures are the U.S., Ireland, the U.K. and Singapore, where the statutory tax rates were 21%, 12.5%, 25% and 17%, respectively, as of March 30, 2024. The Company has a Development and Expansion Incentive in Singapore that provides a concessionary income tax rate of 5% on certain types of income for the period April 1, 2021 through March 31, 2026. The effect of applying the concessionary income tax rate rather than the statutory tax rate to income from qualifying activities in Singapore increased the Company’s net income by $2 million and $3 million and increased the Company’s net income per diluted share by $0.03 and $0.05 for the first quarter of 2024 and 2023, respectively.

The Company’s effective tax rate for the first quarter of 2024 and 2023 was 11.0% and 14.7%, respectively. The income tax provision includes a $1 million and a $2 million income tax benefit related to stock-based compensation for the first quarter of 2024 and 2023, respectively. The remaining differences between the effective tax rates can primarily be attributed the impact of discrete tax benefits in the current year and to differences in the proportionate amounts of pre-tax income recognized in jurisdictions with different effective tax rates.

Effective in 2024, various foreign jurisdictions began implementing aspects of the guidance issued by the Organization for Economic Co-operation and Development related to the new Pillar Two system of global minimum tax rules. These changes in tax law did not have a material impact on the Company’s financial position, results of operations and cash flows for the first quarter of 2024. The Company continues to monitor the adoption of the Pillar Two rules in additional jurisdictions.

 

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Liquidity and Capital Resources

Condensed Consolidated Statements of Cash Flows (in thousands):

 

     Three Months Ended  
     March 30, 2024      April 1, 2023  

Net income

    $ 102,196      $ 140,923  

Depreciation and amortization

      48,514        31,154  

Stock-based compensation

      10,913        12,805  

Deferred income taxes

      4,453        (5,078 ) 

Change in accounts receivable

      62,592        44,047  

Change in inventories

      (28,309 )       (42,621 ) 

Change in accounts payable and other current liabilities

      (18,418 )       (71,257 ) 

Change in deferred revenue and customer advances

      85,901        77,206  

Other changes

      (4,972 )       9,572  
  

 

 

     

 

 

  

Net cash provided by operating activities

      262,870        196,751  

Net cash used in investing activities

      (29,744 )       (34,406 ) 

Net cash used in financing activities

      (292,176 )       (159,211 ) 

Effect of exchange rate changes on cash and cash equivalents

      1,264        2,407  
  

 

 

     

 

 

  

(Decrease) increase in cash and cash equivalents

    $ (57,786 )     $ 5,541  
  

 

 

     

 

 

  

Cash Flow from Operating Activities

Net cash provided by operating activities was $263 million and $197 million during the first quarter of 2024 and 2023, respectively. The decrease in 2024 operating cash flow was primarily a result of lower net income and higher inventory levels, offset by higher cash collections and lower annual incentive bonus payments in 2024 compared to 2023. The changes within net cash provided by operating activities include the following significant changes in the sources and uses of net cash provided by operating activities, aside from the changes in net income:

 

  •  

The changes in accounts receivable were primarily attributable to timing of payments made by customers and timing of sales. Days sales outstanding was 89 days at March 30, 2024 and 91 days at April 1, 2023.

 

  •  

The increase in inventory can primarily be attributed to higher material costs.

 

  •  

Net cash provided from deferred revenue and customer advances results from annual increases in new service contracts as a higher installed base of customers renew annual service contracts.

 

  •  

Other changes were attributable to variation in the timing of various provisions, expenditures, prepaid income taxes and accruals in other current assets, other assets and other liabilities.

Cash Flow from Investing Activities

Net cash used in investing activities totaled $30 million and $34 million in the first quarter of 2024 and 2023, respectively. Additions to fixed assets and capitalized software were $29 million and $34 million in the first three months of 2024 and 2023, respectively.

During the first three months of 2024 and 2023, the Company purchased $1 million of investments, while $1 million of investments matured, and were used for financing activities described below.

Cash Flow from Financing Activities

The Company entered into a credit agreement in September 2021 governing the Company’s five-year, $1.8 billion revolving credit facility that matures in September 2026. On March 3, 2023, the Company entered into an agreement to amend such credit agreement. The 2023 Amendment increased the borrowing capacity by $200 million to an aggregate borrowing capacity of $2.0 billion. As of March 30, 2024, the Company had a total of $2.1 billion in outstanding debt, which consisted of $1.3 billion in outstanding senior unsecured notes and $750 million borrowed under its credit agreement. The Company’s net debt borrowings decreased by $300 million and $95 million during the three months ended March 30, 2024 and April 1, 2023, respectively.

 

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As of March 30, 2024, the Company has entered into interest rate cross-currency swap derivative agreements with durations up to three years with a notional value $625 million to hedge the variability in the movement of foreign currency exchange rates on a portion of its euro-denominated and yen-denominated net asset investments. As a result of entering into these agreements, the Company lowered net interest expense by approximately $3 million in the first quarter of 2024 and 2023. The Company anticipates that these swap agreements will lower net interest expense by approximately $8 million in 2024.

In December 2023, the Company’s Board of Directors authorized the extension of its existing share repurchase program through January 21, 2025. The Company’s remaining authorization is $1.0 billion. During the three months ended April 1, 2023, the Company repurchased 0.2 million shares of the Company’s outstanding common stock at a cost of $58 million under the Company’s share repurchase program. The Company did not make any open market share repurchases in 2024. In addition, the Company repurchased $13 million and $11 million of common stock related to the vesting of restricted stock units during the three months ended March 30, 2024 and April 1, 2023, respectively. While the Company believes that it has the financial flexibility to fund these share repurchases, as well as to invest in research, technology and business acquisitions, given current cash levels and debt borrowing capacity, it has temporarily suspended its share repurchases due to its recent acquisition of Wyatt.

The Company received $14 million and $2 million of proceeds from the exercise of stock options and the purchase of shares pursuant to the Company’s employee stock purchase plan during the first three months of 2024 and 2023, respectively.

The Company had cash, cash equivalents and investments of $338 million as of March 30, 2024. The majority of the Company’s cash and cash equivalents are generated from foreign operations, with $305 million held by foreign subsidiaries at March 30, 2024, of which $239 million was held in currencies other than U.S. dollars.

Contractual Obligations, Commercial Commitments, Contingent Liabilities and Dividends

A summary of the Company’s contractual obligations and commercial commitments is included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 27, 2024. The Company reviewed its contractual obligations and commercial commitments as of March 30, 2024 and determined that there were no material changes outside the ordinary course of business from the information set forth in the Annual Report on Form 10-K.

From time to time, the Company and its subsidiaries are involved in various litigation matters arising in the ordinary course of business. The Company believes that it has meritorious arguments in its current litigation matters and that any outcome, either individually or in the aggregate, will not be material to the Company’s financial position or results of operations.

During fiscal year 2024, the Company expects to contribute a total of approximately $3 million to $6 million to its defined benefit plans.

The Company has not paid any dividends and has no plans, at this time, to pay any dividends in the future.

Critical Accounting Policies and Estimates

In the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 27, 2024, the Company’s most critical accounting policies and estimates upon which its financial status depends were identified as those relating to revenue recognition, valuation of long-lived assets, intangible assets and goodwill, income taxes, uncertain tax positions and business combinations and asset acquisitions. The Company reviewed its policies and determined that those policies remain the Company’s most critical accounting policies for the three months ended March 30, 2024. The Company did not make any changes in those policies during the three months ended March 30, 2024.

 

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New Accounting Pronouncements

Please refer to Note 13, Recent Accounting Standard Changes and Developments, in the Condensed Notes to Consolidated Financial Statements.

Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q, including the information incorporated by reference herein, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Statements that are not statements of historical fact may be deemed forward-looking statements. You can identify these forward-looking statements by the use of the words “feels”, “believes”, “anticipates”, “plans”, “expects”, “may”, “will”, “would”, “intends”, “suggests”, “appears”, “estimates”, “projects”, “should” and similar expressions, whether in the negative or affirmative. These forward-looking statements are subject to various risks and uncertainties, many of which are outside the control of the Company, including, and without limitation:

 

  •  

foreign currency exchange rate fluctuations potentially affecting translation of the Company’s future non-U.S. operating results, particularly when a foreign currency weakens against the U.S. dollar;

 

  •  

current global economic, sovereign and political conditions and uncertainties, including the effect of new or proposed tariff or trade regulations, as well as other new or changed domestic and foreign laws, regulations and policies, changes in inflation and interest rates, the impacts and costs of war, in particular as a result of the ongoing conflicts between Russia and Ukraine and in the Middle East, and the possibility of further escalation resulting in new geopolitical and regulatory instability and the Chinese government’s ongoing tightening of restrictions on procurement by government-funded customers;

 

  •  

the Company’s ability to access capital, maintain liquidity and service the Company’s debt in volatile market conditions;

 

  •  

risks related to the effects of any pandemic on our business, financial condition, results of operations and prospects;

 

  •  

changes in timing and demand for the Company’s products among the Company’s customers and various market sectors, particularly as a result of fluctuations in their expenditures or ability to obtain funding;

 

  •  

the ability to realize the expected benefits related to the Company’s various cost-saving initiatives, including workforce reductions and organizational restructurings;

 

  •  

the introduction of competing products by other companies and loss of market share, as well as pressures on prices from competitors and/or customers;

 

  •  

changes in the competitive landscape as a result of changes in ownership, mergers and continued consolidation among the Company’s competitors;

 

  •  

regulatory, economic and competitive obstacles to new product introductions, lack of acceptance of new products and inability to grow organically through innovation;

 

  •  

rapidly changing technology and product obsolescence;

 

  •  

risks associated with previous or future acquisitions, strategic investments, joint ventures and divestitures, including risks associated with achieving the anticipated financial results and operational synergies; contingent purchase price payments; and expansion of our business into new or developing markets;

 

  •  

risks associated with unexpected disruptions in operations;

 

  •  

failure to adequately protect the Company’s intellectual property, infringement of intellectual property rights of third parties and inability to obtain licenses on commercially reasonable terms;

 

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  •  

the Company’s ability to acquire adequate sources of supply and its reliance on outside contractors for certain components and modules, as well as disruptions to its supply chain;

 

  •  

risks associated with third-party sales intermediaries and resellers;

 

  •  

the impact and costs of changes in statutory or contractual tax rates in jurisdictions in which the Company operates as well as shifts in taxable income among jurisdictions with different effective tax rates, the outcome of ongoing and future tax examinations and changes in legislation affecting the Company’s effective tax rate;

 

  •  

the Company’s ability to attract and retain qualified employees and management personnel;

 

  •  

risks associated with cybersecurity and technology, including attempts by third parties to defeat the security measures of the Company and its third-party partners;

 

  •  

increased regulatory burdens as the Company’s business evolves, especially with respect to the U.S. Food and Drug Administration and U.S. Environmental Protection Agency, among others, and in connection with government contracts;

 

  •  

regulatory, environmental and logistical obstacles affecting the distribution of the Company’s products, completion of purchase order documentation and the ability of customers to obtain letters of credit or other financing alternatives;

 

  •  

risks associated with litigation and other legal and regulatory proceedings; and

 

  •  

the impact and costs incurred from changes in accounting principles and practices.

Certain of these and other factors are discussed under the heading “Risk Factors” under Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 27, 2024. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements, whether because of these factors or for other reasons. All forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and are expressly qualified in their entirety by the cautionary statements included in this report. Except as required by law, the Company does not assume any obligation to update any forward-looking statements.

Item 3: Quantitative and Qualitative Disclosures About Market Risk

The Company is exposed to the risk of interest rate fluctuations from the investments of cash generated from operations. Investments with maturities greater than 90 days are classified as investments and are held primarily in U.S. dollar-denominated treasury bills and commercial paper, bank deposits and corporate debt securities. As of March 30, 2024, the Company estimates that a hypothetical adverse change of 100 basis points across all maturities would not have a material effect on the fair market value of its portfolio.

The Company is also exposed to the risk of exchange rate fluctuations. The Company maintains cash balances in various operating accounts in excess of federally insured limits, and in foreign subsidiary accounts in currencies other than the U.S. dollar. As of March 30, 2024 and December 31, 2023, $305 million out of $338 million and $321 million out of $396 million, respectively, of the Company’s total cash, cash equivalents and investments were held by foreign subsidiaries. In addition, $239 million out of $338 million and $233 million out of $396 million of cash, cash equivalents and investments were held in currencies other than the U.S. dollar at March 30, 2024 and December 31, 2023, respectively. As of March 30, 2024, the Company had no holdings in auction rate securities or commercial paper issued by structured investment vehicles.

Assuming a hypothetical adverse change of 10% in year-end exchange rates (a strengthening of the U.S. dollar), the fair market value of the Company’s cash, cash equivalents and investments held in currencies other than the U.S. dollar as of March 30, 2024 would decrease by approximately $24 million, of which the majority would be recorded to foreign currency translation in other comprehensive income within stockholders’ equity.

There have been no other material changes in the Company’s market risk during the three months ended March 30, 2024. For information regarding the Company’s market risk, refer to Item 7A of Part II of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 27, 2024.

 

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Item 4: Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company’s chief executive officer and chief financial officer (principal executive officer and principal financial officer), with the participation of management, evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on this evaluation, the Company’s chief executive officer and chief financial officer concluded that the Company’s disclosure controls and procedures were effective as of March 30, 2024 (1) to ensure that information required to be disclosed by the Company, including its consolidated subsidiaries, in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its chief executive officer and chief financial officer, to allow timely decisions regarding the required disclosure and (2) to provide reasonable assurance that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

Changes in Internal Control Over Financial Reporting

No change was identified in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended March 30, 2024 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

Part II: Other Information

Item 1: Legal Proceedings

There have been no material changes in the Company’s legal proceedings during the three months ended March 30, 2024 as described in Item 3 of Part I of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 27, 2024, other than the $10 million patent litigation settlement provisions and related costs recorded in the three months ended March 30, 2024.

Item 1A: Risk Factors

Information regarding risk factors of the Company is set forth under the heading “Risk Factors” under Part I, Item 1A in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 27, 2024. The Company reviewed its risk factors as of March 30, 2024 and determined that there were no material changes from the ones set forth in the Form 10-K. Note, however, the discussion of certain factors under the subheading “Special Note Regarding Forward-Looking Statements” in Part I, Item 2 of this Quarterly Report on Form 10-Q. These risks are not the only ones facing the Company. Additional risks and uncertainties not currently known to the Company or that the Company currently deems to be immaterial may have a material adverse effect on the Company’s business, financial condition and operating results.

Item 2: Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities by the Issuer

In January 2019, the Company’s Board of Directors authorized the Company to repurchase up to $4 billion of its outstanding common stock in open market or private transactions over a two-year period. This program replaced the remaining amounts available under the pre-existing authorization. In December 2020, the Company’s Board of Directors authorized the extension of the share repurchase program through January 21, 2023. In December 2022, the Company’s Board of Directors amended and extended this repurchase program’s term by one year such that it expired on January 21, 2024 and increased the total authorization level to $4.8 billion, an increase of $750 million. In December 2023, the Company’s Board of Directors authorized the extension of the share repurchase program through January 21, 2025. As of March 30, 2024, the Company had repurchased an aggregate of 15.2 million shares at a cost of $3.8 billion under the January 2019 repurchase program and had a total of $1.0 billion authorized for future repurchases. The size and timing of these purchases, if any, will depend on our stock price and market and business conditions, as well as other factors.

 

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Period
   
Total Number
of Shares
Purchased (1)
     
Average
Price Paid
per Share
     
Total Number of
Shares
Purchased as
Part of Publicly
Announced
Programs
     
Maximum Dollar
Value of Shares
That May Yet Be
Purchased Under
the Programs
  
January 1, 2024 to January 27, 2024
      —       $ —         —       $ 961,207  
January 28, 2024 to February 24, 2024
      9      $ 329.26        —       $ 961,207  
February 25, 2024 to March 30, 2024
      30      $ 335.87        —       $ 961,207  
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
      39      $ 334.34        —       $ 961,207  
  
 
 
     
 
 
     
 
 
     
 
 
  
 
(1)
The Company repurchased approximately 39,000 shares of common stock at a cost of $13 million related to the vesting of restricted stock during the three months ended March 30, 2024.
Item 5:
 Other Information
Insider Trading Arrangements and Related Disclosures
None.
 
33

Table of Contents

Item 6: Exhibits

 

Exhibit
Number		   

Description of Document

 31.1    Chief Executive Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
 31.2    Chief Financial Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
 32.1    Chief Executive Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(*)
 32.2    Chief Financial Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(*)
101    The following materials from Waters Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 30, 2024, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets (unaudited), (ii) the Consolidated Statements of Operations (unaudited), (iii) the Consolidated Statements of Comprehensive Income (unaudited), (iv) the Consolidated Statements of Cash Flows (unaudited) and (vi) Condensed Notes to Consolidated Financial Statements (unaudited).
104    Cover Page Interactive Date File (formatted in iXBRL and contained in Exhibit 101).

 

(*)

This exhibit shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any filing, except to the extent the Company specifically incorporates it by reference.

 

34

Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

WATERS CORPORATION

/s/ Amol Chaubal

Amol Chaubal

Senior Vice President and Chief Financial Officer

(Principal Financial Officer)

(Principal Accounting Officer)

Date: May 7, 2024

 

35

Exhibit 31.1

CHIEF EXECUTIVE OFFICER CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Udit Batra, certify that:

 

1.

I have reviewed this Quarterly Report on Form 10-Q of Waters Corporation;

 

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  a)

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

  b)

designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

  c)

evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

  d)

disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

  b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 7, 2024

 

/s/ Udit Batra, Ph.D.
Udit Batra, Ph.D.
Chief Executive Officer

Exhibit 31.2

CHIEF FINANCIAL OFFICER CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Amol Chaubal, certify that:

 

1.

I have reviewed this Quarterly Report on Form 10-Q of Waters Corporation;

 

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  a)

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

  b)

designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

  c)

evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

  d)

disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

  b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 7, 2024

 

/s/ Amol Chaubal
Amol Chaubal
Chief Financial Officer

Exhibit 32.1

CHIEF EXECUTIVE OFFICER CERTIFICATION PURSUANT TO 18 U.S.C.

SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

The certification set forth below is hereby made solely for the purpose of satisfying the requirements of Section 906 of the Sarbanes-Oxley Act of 2002 and may not be relied upon or used for any other purposes.

In connection with the Quarterly Report of Waters Corporation (the “Company”) on Form 10-Q for the period ended March 30, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Udit Batra, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: (1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement required by Section 906 or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Date: May 7, 2024

 

By:   /s/ Udit Batra, Ph.D.
  Udit Batra, Ph.D.
  Chief Executive Officer

Exhibit 32.2

CHIEF FINANCIAL OFFICER CERTIFICATION PURSUANT TO 18 U.S.C.

SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

The certification set forth below is hereby made solely for the purpose of satisfying the requirements of Section 906 of the Sarbanes-Oxley Act of 2002 and may not be relied upon or used for any other purposes.

In connection with the Quarterly Report of Waters Corporation (the “Company”) on Form 10-Q for the period ended March 30, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Amol Chaubal, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: (1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement required by Section 906 or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Date: May 7, 2024

 

By:   /s/ Amol Chaubal
  Amol Chaubal
  Chief Financial Officer
v3.24.1.u1
Cover Page - shares
 3 Months Ended
Mar. 30, 2024
May 03, 2024
Cover [Abstract]    
Document Type 10-Q  
Document Fiscal Period Focus Q1  
Document Fiscal Year Focus 2024  
Amendment Flag false  
Entity Interactive Data Current Yes  
Current Fiscal Year End Date --12-31  
Entity Central Index Key 0001000697  
Document Quarterly Report true  
Document Transition Report false  
Document Period End Date Mar. 30, 2024  
Entity Registrant Name Waters Corporation  
Entity File Number 01-14010  
Entity Tax Identification Number 13-3668640  
Entity Incorporation, State or Country Code DE  
Entity Current Reporting Status Yes  
Entity Filer Category Large Accelerated Filer  
Entity Shell Company false  
Entity Small Business false  
Entity Address, Address Line One 34 Maple Street  
Entity Emerging Growth Company false  
Entity Address, City or Town Milford  
Entity Address, State or Province MA  
Entity Address, Postal Zip Code 01757  
City Area Code 508  
Local Phone Number 478-2000  
Trading Symbol WAT  
Security Exchange Name NYSE  
Title of 12(b) Security Common Stock, par value $0.01 per share  
Entity Common Stock, Shares Outstanding   59,319,699
v3.24.1.u1
CONSOLIDATED BALANCE SHEETS - USD ($)
$ in Thousands
Mar. 30, 2024
Dec. 31, 2023
Current assets:    
Cash and cash equivalents $ 337,290 $ 395,076
Investments 923 898
Accounts receivable, net 626,329 702,168
Inventories 538,634 516,236
Other current assets 139,782 138,489
Total current assets 1,642,958 1,752,867
Property, plant and equipment, net 633,594 639,073
Intangible assets, net 611,147 629,187
Goodwill 1,297,826 1,305,446
Operating lease assets 81,065 84,591
Other assets 242,374 215,690
Total assets 4,508,964 4,626,854
Current liabilities:    
Notes payable and debt 50,000 50,000
Accounts payable 86,219 84,705
Accrued employee compensation 65,098 69,391
Deferred revenue and customer advances 336,718 256,675
Current operating lease liabilities 26,879 27,825
Accrued income taxes 120,520 120,257
Accrued warranty 10,853 12,050
Other current liabilities 152,172 168,677
Total current liabilities 848,459 789,580
Long-term liabilities:    
Long-term debt 2,005,761 2,305,513
Long-term portion of retirement benefits 48,977 47,559
Long-term income tax liabilities 137,439 137,123
Long-term operating lease liabilities 55,927 58,926
Other long-term liabilities 155,876 137,812
Total long-term liabilities 2,403,980 2,686,933
Total liabilities 3,252,439 3,476,513
Commitments and contingencies (Notes 6, 7 and 9)
Stockholders' equity:    
Preferred stock, par value $0.01 per share, 5,000 shares authorized, none issued at March 30, 2024 and December 31, 2023 0 0
Common stock, par value $0.01 per share, 400,000 shares authorized, 162,882 and 162,709 shares issued, 59,310 and 59,176 shares outstanding at March 30, 2024 and December 31, 2023, respectively 1,629 1,627
Additional paid-in capital 2,291,103 2,266,265
Retained earnings 9,253,017 9,150,821
Treasury stock, at cost, 103,572 and 103,533 shares at March 30, 2024 and December 31, 2023, respectively (10,147,341) (10,134,252)
Accumulated other comprehensive loss (141,883) (134,120)
Total stockholders' equity 1,256,525 1,150,341
Total liabilities and stockholders' equity $ 4,508,964 $ 4,626,854
v3.24.1.u1
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares
shares in Thousands
Mar. 30, 2024
Dec. 31, 2023
Statement of Financial Position [Abstract]    
Preferred stock, par value per share $ 0.01 $ 0.01
Preferred stock, shares authorized 5,000 5,000
Preferred stock, shares issued 0 0
Common stock, par value per share $ 0.01 $ 0.01
Common stock, shares authorized 400,000 400,000
Common stock, shares issued 162,882 162,709
Common stock, shares outstanding 59,310 59,176
Treasury stock, shares 103,572 103,533
v3.24.1.u1
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
shares in Thousands, $ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Revenues:    
Total net sales $ 636,839 $ 684,674
Costs and operating expenses:    
Selling and administrative expenses 174,536 181,956
Research and development expenses 44,595 42,691
Purchased intangibles amortization 11,834 1,479
Litigation provision 10,242 0
Total costs and operating expenses 502,993 510,506
Operating income 133,846 174,168
Other income, net 2,259 1,388
Interest expense (25,520) (14,444)
Interest income 4,271 4,061
Income before income taxes 114,856 165,173
Provision for income taxes 12,660 24,250
Net income $ 102,196 $ 140,923
Net income per basic common share $ 1.73 $ 2.39
Weighted-average number of basic common shares 59,232 59,023
Net income per diluted common share $ 1.72 $ 2.38
Weighted-average number of diluted common shares and equivalents 59,431 59,317
Product [Member]    
Revenues:    
Total net sales $ 376,151 $ 436,457
Costs and operating expenses:    
Costs and operating expenses 153,182 180,354
Service [Member]    
Revenues:    
Total net sales 260,688 248,217
Costs and operating expenses:    
Costs and operating expenses $ 108,604 $ 104,026
v3.24.1.u1
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Statement of Comprehensive Income [Abstract]    
Net income $ 102,196 $ 140,923
Other comprehensive (loss) income:    
Foreign currency translation (9,540) 8,783
Unrealized gains on derivative instruments before reclassifications 2,405 0
Amounts reclassified to interest income (297) 0
Unrealized gains on derivative instruments before income taxes 2,108 0
Income tax expense (506) 0
Unrealized gains on derivative instruments, net of tax 1,602 0
Retirement liability adjustment before reclassifications 332 80
Amounts reclassified to other income (117) (83)
Retirement liability adjustment before income taxes 215 (3)
Income tax expense (40) (4)
Retirement liability adjustment, net of tax 175 (7)
Other comprehensive (loss) income (7,763) 8,776
Comprehensive income $ 94,433 $ 149,699
v3.24.1.u1
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Cash flows from operating activities:    
Net income $ 102,196 $ 140,923
Adjustments to reconcile net income to net cash provided by operating activities:    
Stock-based compensation 10,913 12,805
Deferred income taxes 4,453 (5,078)
Depreciation 22,129 19,411
Amortization of intangibles 26,385 11,743
Change in operating assets and liabilities:    
Decrease in accounts receivable 62,592 44,047
Increase in inventories (28,309) (42,621)
Increase in other current assets (4,707) (2,123)
Decrease in other assets 7,369 6,662
Decrease in accounts payable and other current liabilities (18,418) (71,257)
Increase in deferred revenue and customer advances 85,901 77,206
(Decrease) increase in other liabilities (7,634) 5,033
Net cash provided by operating activities 262,870 196,751
Cash flows from investing activities:    
Additions to property, plant, equipment and software capitalization (28,655) (34,390)
Investments in unaffiliated companies (1,064) 0
Purchases of investments (923) (893)
Maturities and sales of investments 898 877
Net cash used in investing activities (29,744) (34,406)
Cash flows from financing activities:    
Proceeds from debt issuances 0 50,040
Payments on debt (300,000) (145,000)
Proceeds from stock plans 13,932 2,378
Purchases of treasury shares (13,089) (69,505)
Proceeds from derivative contracts 6,981 2,876
Net cash used in financing activities (292,176) (159,211)
Effect of exchange rate changes on cash and cash equivalents 1,264 2,407
(Decrease) increase in cash and cash equivalents (57,786) 5,541
Cash and cash equivalents at beginning of period 395,076 480,529
Cash and cash equivalents at end of period $ 337,290 $ 486,070
v3.24.1.u1
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($)
shares in Thousands, $ in Thousands
Total
Common Stock [Member]
Additional Paid-In Capital [Member]
Retained Earnings [Member]
Treasury Stock [Member]
Accumulated Other Comprehensive Loss [Member]
Beginning balance at Dec. 31, 2022 $ 504,488 $ 1,624 $ 2,199,824 $ 8,508,587 $ (10,063,975) $ (141,572)
Beginning Balance, shares at Dec. 31, 2022   162,425        
Net income 140,923     140,923    
Other comprehensive income (loss) 8,776         8,776
Issuance of common stock for Employee Stock Purchase Plan 2,000   2,000      
Issuance of common stock for Employee Stock Purchase Plan, shares   8        
Issuance of common stock for stock options exercised 969 $ 0 969      
Issuance of common stock for stock options exercised, shares   6        
Treasury stock (69,505)       (69,505)  
Stock-based compensation 12,172 $ 2 12,170      
Stock-based compensation, shares   111        
Ending balance at Apr. 01, 2023 599,823 $ 1,626 2,214,963 8,649,510 (10,133,480) (132,796)
Ending Balance, shares at Apr. 01, 2023   162,550        
Beginning balance at Dec. 31, 2023 1,150,341 $ 1,627 2,266,265 9,150,821 (10,134,252) (134,120)
Beginning Balance, shares at Dec. 31, 2023   162,709        
Net income 102,196     102,196    
Other comprehensive income (loss) (7,763)         (7,763)
Issuance of common stock for Employee Stock Purchase Plan 1,996   1,996      
Issuance of common stock for Employee Stock Purchase Plan, shares   8        
Issuance of common stock for stock options exercised 12,552 $ 1 12,551      
Issuance of common stock for stock options exercised, shares   51        
Treasury stock (13,089)       (13,089)  
Stock-based compensation 10,292 $ 1 10,291      
Stock-based compensation, shares   114        
Ending balance at Mar. 30, 2024 $ 1,256,525 $ 1,629 $ 2,291,103 $ 9,253,017 $ (10,147,341) $ (141,883)
Ending Balance, shares at Mar. 30, 2024   162,882        
v3.24.1.u1
Insider Trading Arrangements
 3 Months Ended
Mar. 30, 2024
Trading Arrangements, by Individual  
Rule 10b5-1 Arrangement Adopted false
Non-Rule 10b5-1 Arrangement Adopted false
Rule 10b5-1 Arrangement Terminated false
Non-Rule 10b5-1 Arrangement Terminated false
v3.24.1.u1
Basis of Presentation and Summary of Significant Accounting Policies
 3 Months Ended
Mar. 30, 2024
Accounting Policies [Abstract]  
Basis of Presentation and Summary of Significant Accounting Policies
1 Basis of Presentation and Summary of Significant Accounting Policies
Waters Corporation (the “Company,” “we,” “our,” or “us”), a global leader in analytical instruments and software, has pioneered innovations in chromatography, mass spectrometry and thermal analysis serving life, materials and food sciences for more than 65 years. The Company primarily designs, manufactures, sells and services high-performance liquid chromatography (“HPLC”), ultra-performance liquid chromatography (“UPLC” and together with HPLC, referred to as “LC”) and mass spectrometry (“MS”) technology systems and support products, including chromatography columns, other consumable products and comprehensive post-warranty service plans. These systems are complementary products that are frequently employed together
(“LC-MS”)
and sold as integrated instrument systems using common software platforms. LC is a standard technique and is utilized in a broad range of industries to detect, identify, monitor and measure the chemical, physical and biological composition of materials, and to purify a full range of compounds. MS technology, principally in conjunction with chromatography, is employed in drug discovery and development, including clinical trial testing, the analysis of proteins in disease processes (known as “proteomics”), nutritional safety analysis and environmental testing.
LC-MS
instruments combine a liquid phase sample introduction and separation system with mass spectrometric compound identification and quantification. In addition, the Company designs, manufactures, sells and services thermal analysis, rheometry and calorimetry instruments through its TA Instruments product line. These instruments are used in predicting the suitability and stability of fine chemicals, pharmaceuticals, water, polymers, metals and viscous liquids for various industrial, consumer goods and healthcare products, as well as for life science research. The Company is also a developer and supplier of advanced software-based products that interface with the Company’s instruments, as well as other manufacturers’ instruments.
On May 16, 2023, the Company completed the acquisition of Wyatt Technology, LLC and its three operating subsidiaries, Wyatt Technology Europe GmbH, Wyatt Technology France and Wyatt Technology UK Ltd. (collectively, “Wyatt”), for a total purchase price of $1.3 
billion in cash. Wyatt is a pioneer in innovative light scattering and field-flow fractionation instruments, software, accessories and services. The acquisition will expand Waters’ portfolio and increase exposure to large molecule applications. The Company financed this transaction with a combination of cash on its balance sheet and borrowings under its Credit Facility (as defined below). The Company’s financial results for the three months ended March 30, 2024 include the financial results of Wyatt. The Company’s financial results for the three months ended April 1, 2023 do not include any of the financial results of Wyatt since the closing of the Wyatt acquisition occurred in the second fiscal quarter of 2023. In addition, the Company has completed the purchase price allocation for the Wyatt acquisition and there were no material changes as compared to the Company’s preliminary purchase price allocation for the Wyatt acquisition.
The Company’s interim fiscal quarter typically ends on the thirteenth Saturday of each quarter. Since the Company’s fiscal year end is December 31, the first and fourth fiscal quarters may have more or less than thirteen complete weeks. The Company’s first fiscal quarters for 2024 and 2023 ended on March 30, 2024 and April 1, 2023, respectively.
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with the instructions in Form
10-Q
and do not include all of the information and footnote disclosures required for annual financial statements prepared in accordance with generally accepted accounting principles (“U.S. GAAP”) in the United States of America. The consolidated financial statements include the accounts of the Company and its subsidiaries, all of which are wholly owned. All inter-company balances and transactions have been eliminated.
The preparation of consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent liabilities at the dates of the financial statements. Actual amounts may differ from these estimates under different assumptions or conditions.
It is management’s opinion that the accompanying interim consolidated financial statements reflect all adjustments (which are normal and recurring) that are necessary for a fair statement of the results for the interim periods. The interim consolidated financial statements should be read in conjunction with the consolidated financial statements included in the Company’s Annual Report on Form
10-K
for the year ended December 31, 2023, as filed with the U.S. Securities and Exchange Commission (“SEC”) on February 27, 2024.
 
Risks and Uncertainties
The Company is subject to risks common to companies in the analytical instrument industry, including, but not limited to, global economic and financial market conditions, fluctuations in foreign currency exchange rates, fluctuations in customer demand, development by its competitors of new technological innovations, costs of developing new technologies, levels of debt and debt service requirements, risk of disruption, dependence on key personnel, protection and litigation of proprietary technology, shifts in taxable income between tax jurisdictions and compliance with regulations of the U.S. Food and Drug Administration and similar foreign regulatory authorities and agencies.
Translation of Foreign Currencies
The functional currency of each of the Company’s foreign operating subsidiaries is the local currency of its country of domicile, except for the Company’s subsidiaries in Hong Kong, Singapore and the Cayman Islands, where the underlying transactional cash flows are denominated in currencies other than the respective local currency of domicile. The functional currency of the Hong Kong, Singapore and Cayman Islands subsidiaries is the U.S. dollar, based on the respective entity’s cash flows.
For the Company’s foreign operations, assets and liabilities are translated into U.S. dollars at exchange rates prevailing on the balance sheet date, while revenues and expenses are translated at average exchange rates prevailing during the respective period. Any resulting translation gains or losses are included in accumulated other comprehensive loss in the consolidated balance sheets.
Cash, Cash Equivalents and Investments
Cash equivalents represent highly liquid investments, with original maturities of 90 days or less, while investments with longer maturities are classified as investments. The Company maintains cash balances in various operating accounts in excess of federally insured limits, and in foreign subsidiary accounts in currencies other than the U.S. dollar. As of March 30, 2024 and December 31, 2023, $305 million out of $338 million and $321 million out of $396 million, respectively, of the Company’s total cash, cash equivalents and investments were held by foreign subsidiaries. In addition, $239 million out of $338 million and $233 million out of $396 million of cash, cash equivalents and investments were held in currencies
other
than the U.S. dollar at March 30, 2024 and December 31, 2023, respectively.
Accounts Receivable and Allowance for Credit Losses
Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The Company has very limited use of rebates and other cash considerations payable to customers and, as a result, the transaction price determination does not have any material variable consideration. The Company does not consider there to be significant concentrations of credit risk with respect to trade receivables due to the short-term nature of the balances, the Company having a large and diverse customer base, and the Company having a strong historical experience of collecting receivables with minimal defaults. As a result, credit risk is considered low across territories and trade receivables are considered to be a single class of financial asset. The allowance for credit losses is based on a number of factors and is calculated by applying a historical loss rate to trade receivable aging balances to estimate a general reserve balance along with an additional adjustment for any specific receivables with known or anticipated issues affecting the likelihood of recovery. Past due balances with a probability of default based on historical data as well as relevant available forward-looking information are included in the specific adjustment. The historical loss rate is reviewed on at least an annual basis and the allowance for credit losses is reviewed quarterly for any required adjustments. The Company does not have any
off-balance
sheet credit exposure related to its customers.
Trade receivables related to instrument sales are collateralized by the instrument that is sold. If there is a risk of default related to a receivable that is collateralized, then the fair value of the collateral is calculated and adjusted for the cost to
re-possess,
refurbish and
re-sell
the instrument. This adjusted fair value is compared to the receivable balance and the difference would be recorded as the expected credit loss.
 
The following is a summary of the activity of the Company’s allowance for credit losses for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
 
 
  
Balance at
Beginning of
Period
 
  
Additions
 
  
Deductions and
Other
 
  
Balance at End
of Period
 
Allowance for Credit Losses
            
March 30, 2024
    $ 19,335      $ 991      $ (5,461 )    $ 14,865  
April 1, 2023
    $ 14,311      $ 1,572      $ (1,028 )     $ 14,855  
Fair Value Measurements
In accordance with the accounting standards for fair value measurements and disclosures, certain of the Company’s assets and liabilities are measured at fair value on a recurring basis as of March 30, 2024 and December 31, 2023. Fair values determined by Level 1 inputs utilize observable data, such as quoted prices in active markets. Fair values determined by Level 2 inputs utilize data points other than quoted prices in active markets that are observable either directly or indirectly. Fair values determined by Level 3 inputs utilize unobservable data points for which there is little or no market data, which require the reporting entity to develop its own assumptions.
The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis at March 30, 2024 (in thousands):
 
 
  
Total at
March 30,
2024
 
  
Quoted Prices
in Active
Markets

for Identical
Assets

(Level 1)
 
  
Significant
Other
Observable
Inputs
(Level 2)
 
  
Significant
Unobservable
Inputs

(Level 3)
 
Assets:
  
  
  
  
Time deposits
    $ 923      $ —       $ 923      $ —   
Waters 401(k) Restoration Plan assets
      30,791        30,791        —         —   
Interest rate cross-currency swap agreements
      7,642        —         7,642        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 39,356      $ 30,791      $ 8,565      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Liabilities:
            
Foreign currency exchange contracts
    $ 75      $ —       $ 75      $ —   
Interest rate cross-currency swap agreements
      5,510        —         5,510        —   
Interest rate swap cash flow hedge
      865        —         865        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 6,450      $ —       $ 6,450      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis at December 31, 2023 (in thousands):
 
  
Total at
December 31,
2023
 
  
Quoted Prices
in Active
Markets

for Identical
Assets

(Level 1)
 
  
Significant
Other
Observable
Inputs
(Level 2)
 
  
Significant
Unobservable
Inputs

(Level 3)
 
Assets:
  
  
  
  
Time deposits
    $ 898      $ —       $ 898      $ —   
Waters 401(k) Restoration Plan assets
      28,995        28,995        —         —   
Foreign currency exchange contracts
      183        —         183        —   
Interest rate cross-currency swap agreements
      4,835        —         4,835        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 34,911      $ 28,995      $ 5,916      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Liabilities:
            
Foreign currency exchange contracts
      207        —         207        —   
Interest rate cross-currency swap agreements
      13,384        —         13,384        —   
Interest rate swap cash flow hedge
      2,974        —         2,974        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 16,565      $ —       $ 16,565      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Fair Value of 401(k) Restoration Plan Assets
The 401(k) Restoration Plan is a nonqualified defined contribution plan and the assets were held in registered mutual funds and have been classified as Level 1. The fair values of the assets in the plan are determined through market and observable sources from daily quoted prices on nationally recognized securities exchanges.
Fair Value of Cash Equivalents, Investments, Foreign Currency Exchange Contracts, Interest Rate Cross-Currency Swap Agreements and Interest Rate Swap Cash Flow Hedges
The fair values of the Company’s cash equivalents, investments, foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap cash flow hedges are determined through market and observable sources and have been classified as Level 2. These assets and liabilities have been initially valued at the transaction price and subsequently valued, typically utilizing third-party pricing services. The pricing services use many inputs to determine value, including reportable trades, benchmark yields, credit spreads, broker/dealer quotes, current spot rates and other industry and economic events. The Company validates the prices provided by third-party pricing services by reviewing their pricing methods and obtaining market values from other pricing sources.
Fair Value of Other Financial Instruments
The Company’s accounts receivable and accounts payable are recorded at cost, which approximates fair value due to their short-term nature. The carrying value of the Company’s variable interest rate debt approximates fair value due to the variable nature of the interest rate. The carrying value of the Company’s fixed interest rate debt was $1.3 billion at both March 30, 2024 and December 31, 2023. The fair value of the Company’s fixed interest rate debt was estimated using discounted cash flow models, based on estimated current rates offered for similar debt under current market conditions for the Company. The fair value of the Company’s fixed interest rate debt was estimated to be $1.2 billion at both March 30, 2024 and December 31, 2023, using Level 2 inputs.
Derivative Transactions
The Company is a global company that operates in over 35 countries and, as a result, the Company’s net sales, cost of sales, operating expenses and balance sheet amounts are significantly impacted by fluctuations in foreign currency exchange rates. The Company is exposed to currency price risk on foreign currency exchange rate fluctuations when it translates its
non-U.S.
dollar foreign subsidiaries’ financial statements into U.S. dollars and when any of the Company’s subsidiaries purchase or sell products or services in a currency other than its own
currency.
 
 
The Company’s principal strategies in managing exposures to changes in foreign currency exchange rates are to (1) naturally hedge the foreign-currency-denominated liabilities on the Company’s balance sheet against corresponding assets of the same currency, such that any changes in liabilities due to fluctuations in foreign currency exchange rates are typically offset by corresponding changes in assets and (2) mitigate foreign exchange risk exposure of international operations by hedging the variability in the movement of foreign currency exchange rates on a portion of its euro-denominated and
yen-denominated
net asset investments. The Company presents the derivative transactions in financing activities in the statement of cash flows.
Foreign Currency Exchange Contracts
The Company does not specifically enter into any derivatives that hedge foreign-currency-denominated operating assets, liabilities or commitments on its balance sheet, other than a portion of certain third-party accounts receivable and accounts payable, and the Company’s net worldwide intercompany receivables and payables, which are eliminated in consolidation. The Company periodically aggregates its net worldwide balances by currency and then enters into foreign currency exchange contracts that mature within 90 days to hedge a portion of the remaining balance to minimize some of the Company’s currency price risk exposure. The foreign currency exchange contracts are not designated for hedge accounting treatment. Principal hedged currencies include the euro, Japanese yen, British pound, Mexican peso and Brazilian real.
Cash Flow Hedges
The Company’s Credit Facility is a variable borrowing and has interest payments based on a contractually specified interest rate index. The contractually specified index on the Credit Facility is the
3-month
Term SOFR. The variable rate interest payments create interest risk for the Company as interest payments will fluctuate based on changes in the contractually specified interest rate index over the life of the Credit Facility. In order to reduce interest rate risk, the Company enters into interest rate swaps that will effectively
lock-in
the forecasted interest payments on the variable rate borrowing over its term. The interest rate swaps represent cash flow hedges and are assessed for hedge effectiveness each reporting period. When the hedge relationship is highly effective at achieving offsetting changes in cash flows, the Company will record the entire change in fair value of the interest rate swaps in accumulated other comprehensive loss. The amount in accumulated other comprehensive loss is reclassified to income in the period that the underlying transaction impacts consolidated income. If it becomes probable that the forecasted transaction will not occur, the hedge relationship will be
de-designated
and amounts accumulated in other comprehensive loss will be reclassified to income in the current period. Interest settlements due to benchmark interest rate changes are recorded in interest income or interest expense. For the three months ended March 30, 2024, the Company did not have any cash flow hedges that were deemed ineffective.
Interest Rate Cross-Currency Swap Agreements
As of March 30, 2024, the Company had entered into interest rate cross-currency swap derivative agreements with durations up to three years with an aggregate notional value of $625 million to hedge the variability in the movement of foreign currency exchange rates on a portion of its euro-denominated and
yen-denominated
net asset investments. Under hedge accounting, the change in fair value of the derivative that relates to changes in the foreign currency spot rate are recorded in the currency translation adjustment in other comprehensive income and remain in accumulated other comprehensive loss in stockholders’ equity until the sale or substantial liquidation of the foreign operation. The difference between the interest rate received and paid under the interest rate cross-currency swap derivative agreement is recorded in interest income in the statement of operations.
 
The Company’s foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap agreements designated as cash flow hedges are included in the consolidated balance sheets are classified as follows (in thousands):
                                 
 
  
March 30, 2024
 
  
December 31, 2023
 
 
  
Notional
 
  
Fair Value
 
  
Notional
 
  
Fair Value
 
Foreign currency exchange contracts:
  
      
  
      
  
      
  
      
Other current assets
    $ 5,000      $ —       $ 24,155      $ 183  
Other current liabilities
    $ 35,314      $ 75      $ 16,000      $ 207  
Interest rate cross-currency swap agreements:
            
Other assets
    $ 285,000      $ 7,642      $ 220,000      $ 4,835  
Other liabilities
    $ 340,000      $ 5,510      $ 405,000      $ 13,384  
Accumulated other comprehensive income (loss)
       $ 6,942         $ (7,975 ) 
Interest rate swap cash flow hedges:
            
Other liabilities
    $ 100,000      $ 865      $ 100,000      $ 2,974  
Accumulated other comprehensive loss
       $ (865 )        $ (2,974 ) 
The following is a summary of the activity included in the consolidated statements of operations and statements of comprehensive income related to the foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap agreements designated as cash flow hedges (in thousands):

    
Financial

Statement
Classification
   
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Foreign currency exchange contracts:
      
Realized gains on closed contracts
    Cost of sales    $ 257      $ 30  
Unrealized losses on open contracts
    Cost of sales      (51 )       (78 ) 
     
 
 
     
 
 
  
Cumulative net
pre-tax
gains (losses)
    Cost of sales    $ 206      $ (48 ) 
     
 
 
     
 
 
  
Interest rate cross-currency swap agreements:
      
Interest earned
    Interest income    $ 2,537      $ 2,655  
Unrealized gains (losses) on contracts, net
    Accumulated other
comprehensive loss		    $ 14,917      $ (7,256 ) 
Interest rate swap cash flow hedges:
      
Interest earned
    Interest income    $ 296      $ —   
Unrealized gains on
    Accumulated other      
open contracts
    comprehensive loss    $ 2,109      $ —   
 

Stockholders’ Equity
In December 2023, the Company’s Board of Directors authorized the extension of its existing share repurchase program through January 21, 2025. The Company’s remaining authorization is $1.0 billion. During the three months ended April 1, 2023, the Company
 
repurchased 0.2 
million shares of the Company’s outstanding common stock at a cost of
$58 
million under the Company’s share repurchase program. The Company did not make any open market share repurchases in 2024. In addition, the Company repurchased
$13 million and $11 million of common stock related to the vesting of restricted stock units during the three months ended March 30, 2024 and April 1, 2023, respectively.
 
 
Product Warranty Costs
The Company accrues estimated product warranty costs at the time of sale, which are included in cost of sales in the consolidated statements of operations. While the Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers, the Company’s warranty obligation is affected by product failure rates, material usage and service delivery costs incurred in correcting a product failure. The amount of the accrued warranty liability is based on historical information, such as past experience, product failure rates, number of units repaired and estimated costs of material and labor. The liability is reviewed for reasonableness at least quarterly.
The following is a summary of the activity of the Company’s accrued warranty liability for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Balance at
Beginning
of Period
     
Accruals for
Warranties
     
Settlements
Made
     
Balance at
End of
Period
  
Accrued warranty liability:
            
March 30, 2024
    $ 12,050      $ 480      $ (1,677 )     $ 10,853  
April 1, 2023
    $ 11,949      $ 2,177      $ (1,815 )     $ 12,311  
Restructuring
In March 2024, the Company had a reduction in workforce that impacted approximately 2% of the employees, primarily in China due to the significant decline in sales resulting from lower customer demand, which resulted in the Company incurring approximately $8 million of severance-related costs. During the first quarter of 2024, the Company paid $8 
million of severance-related costs in connection with the workforce reductions that occurred in March 2024 and July 2023, with the majority of the remaining costs to be paid in the second quarter of 2024. The accrued restructuring expense was $8 million at both March 30, 2024 and December 31, 2023 and were included in other current liabilities on the consolidated balance sheets.
v3.24.1.u1
Revenue Recognition
 3 Months Ended
Mar. 30, 2024
Revenue from Contract with Customer [Abstract]  
Revenue Recognition
2 Revenue Recognition
The Company’s deferred revenue liabilities in the consolidated balance sheets consist of the obligation on instrument service contracts and customer payments received in advance, prior to transfer of control of the instrument. The Company records deferred revenue primarily related to its service contracts, where consideration is billable at the beginning of the service period.
The following is a summary of the activity of the Company’s deferred revenue and customer advances for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
March 30, 2024
     
April 1, 2023
  
Balance at the beginning of the period
    $ 323,516      $ 285,175  
Recognition of revenue included in balance at beginning of the period
      (103,996 )       (105,222 ) 
Revenue deferred during the period, net of revenue recognized
      187,525        193,286  
  
 
 
     
 
 
  
Balance at the end of the period
    $ 407,045      $ 373,239  
  
 
 
     
 
 
  
The Company classified $70 million and $67 million of deferred revenue and customer advances in other long-term liabilities at March 30, 2024 and December 31, 2023, respectively.
 
 
The amount of deferred revenue and customer advances equals the transaction price allocated to unfulfilled performance obligations for the period presented. Such amounts are expected to be recognized in the future as follows (in thousands):
 
    
March 30, 2024
  
Deferred revenue and customer advances expected to be recognized in:
   
One year or less
    $ 336,718  
13-24
months
      42,162  
25 months and beyond
      28,165  
  
 
 
  
Total
    $ 407,045  
  
 
 
  
v3.24.1.u1
Marketable Securities
 3 Months Ended
Mar. 30, 2024
Investments, Debt and Equity Securities [Abstract]  
Marketable Securities
3 Marketable Securities
The Company’s marketable securities within cash equivalents and investments included in the consolidated balance sheets consist of time deposits that mature in one year or less with an amortized cost and a fair value of $0.9 million at both March 30, 2024 and December 31, 2023.
v3.24.1.u1
Inventories
 3 Months Ended
Mar. 30, 2024
Inventory Disclosure [Abstract]  
Inventories
4 Inventories
Inventories are classified as follows (in thousands):
 
    
March 30, 2024
     
December 31, 2023
  
Raw materials
    $ 241,744      $ 233,952  
Work in progress
      23,825        20,198  
Finished goods
      273,065        262,086  
  
 
 
     
 
 
  
Total inventories
    $ 538,634      $ 516,236  
  
 
 
     
 
 
  
v3.24.1.u1
Goodwill and Other Intangibles
 3 Months Ended
Mar. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangibles
5 Goodwill and Other Intangibles
The carrying amount of goodwill was $1.3 billion at both March 30, 2024 and December 31, 2023.
The Company’s intangible assets included in the consolidated balance sheets are detailed as follows (dollars in thousands):

 
  
March 30, 2024
 
  
December 31, 2023
 
 
  
Gross
Carrying
Amount
 
  
Accumulated
Amortization
 
  
Weighted-
Average
Amortization
Period
 
  
Gross
Carrying
Amount
 
  
Accumulated
Amortization
 
  
Weighted-
Average
Amortization
Period
 
Capitalized software
    $ 655,433      $ 495,177        5 years      $ 660,273      $ 495,317        5
 
years		  
Purchased intangibles
      612,382        207,620        10 years        614,357        197,154        10 years  
Trademarks
      9,680        —         —         9,680        —         —   
Licenses
      14,673        8,698        7 years        14,798        8,429        7 years  
Patents and other intangibles
      113,028        82,554        8 years        111,962        80,983        8 years  
  
 
 
     
 
 
        
 
 
     
 
 
     
Total
    $ 1,405,196      $ 794,049        7 years      $ 1,411,070      $ 781,883        7 years  
  
 
 
     
 
 
        
 
 
     
 
 
     
The Company capitalized $10 million and $14 million of intangible assets in the three months ended March 30, 2024 and April 1, 2023, respectively. The gross carrying value of intangible assets and accumulated amortization for intangible assets decreased by $16 million and $14 million, respectively, in the three months ended March 30, 2024 due to the effects of foreign currency translation. Amortization expense for intangible assets was $26 million and $12 million for the three months ended March 30, 2024 and April 1, 2023, respectively. Amortization expense for intangible assets is estimated to be $108 million per year for each of the next five years.
 
v3.24.1.u1
Debt
 3 Months Ended
Mar. 30, 2024
Debt Disclosure [Abstract]  
Debt
6 Debt
The Company has a five-year, $2.0 
billion revolving credit facility (the “Credit Facility”) that matures in September 2026. As of March 30, 2024 and December 31, 2023, the Credit Facility had a total
 of $0.8 billion and $1.1 billion outstanding, respectively.
The interest rates applicable under the Credit Facility are, at the Company’s option, equal to either the alternate base rate (which is a rate per annum equal to the greatest of (1) the prime rate in effect on such day, (2) the Federal Reserve Bank of New York Rate on such day plus 1⁄2 of 1% per annum and (3) the adjusted Term SOFR rate for a one-month interest period as published two U.S. Government Securities Business Days prior to such day (or if such day is not a U.S. Government Securities Business Day, the immediately preceding U.S. Government Securities Business Day), plus 1% annum) or the applicable 1, 3 or 6 month adjusted Term SOFR or EURIBO rate for euro-denominated loans, in each case, plus an interest rate margin based upon the Company’s leverage ratio, which can range between 0 and 12.5 basis points for alternate base rate loans and between 80 and 112.5 basis points for Term SOFR or EURIBO rate loans. The facility fee on the Credit Facility ranges between 7.5 and 25 basis points per annum, based on the leverage ratio, of the amount of the revolving facility commitments and the outstanding term loan. The Credit Facility requires that the Company comply with an interest coverage ratio test of not less than 3.50:1 as of the end of any fiscal quarter for any period of four consecutive fiscal quarters and a leverage ratio test of not more than 3.50:1 as of the end of any fiscal quarter. In addition, the Credit Facility includes negative covenants, affirmative covenants, representations and warranties and events of default that are customary for investment grade credit facilities.
As of both March 30, 2024 and December 31, 2023, the Company had a total of $1.3 billion of outstanding senior unsecured notes. Interest on the fixed rate senior unsecured notes is payable semi-annually each year. Interest on the floating rate senior unsecured notes is payable quarterly. The Company may prepay all or some of the senior unsecured notes at any time in an amount not less than 10% of the aggregate principal amount outstanding. In the event of a change in control of the Company (as defined in the note purchase agreement), the Company may be required to prepay the senior unsecured notes at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest. These senior unsecured notes require that the Company comply with an interest coverage ratio test of not less than 3.50:1 for any period of four consecutive fiscal quarters and a leverage ratio test of not more than 3.50:1 as of the end of any fiscal quarter. In addition, these senior unsecured notes include customary negative covenants, affirmative covenants, representations and warranties and events of default.
The Company had the following outstanding debt at March 30, 2024 and December 31, 2023 (in thousands):
 
    
March 30, 2024
     
December 31, 2023
  
Senior unsecured notes - Series G -
3.92
%, due June 2024
      50,000        50,000  
  
 
 
     
 
 
  
Total notes payable and debt, current
      50,000        50,000  
Senior unsecured notes - Series K - 3.44%, due May 2026
      160,000        160,000  
Senior unsecured notes - Series L - 3.31%, due September 2026
      200,000        200,000  
Senior unsecured notes - Series M - 3.53%, due September 2029
      300,000        300,000  
Senior unsecured notes - Series N - 1.68%, due March 2026
      100,000        100,000  
Senior unsecured notes - Series O - 2.25%, due March 2031
      400,000        400,000  
Senior unsecured notes - Series P - 4.91%, due May 2028
      50,000        50,000  
Senior unsecured notes - Series Q - 4.91%, due May 2030
      50,000        50,000  
Credit agreement
      750,000        1,050,000  
Unamortized debt issuance costs
      (4,239 )       (4,487 ) 
  
 
 
     
 
 
  
Total long-term debt
      2,005,761        2,305,513  
  
 
 
     
 
 
  
Total debt
    $ 2,055,761      $ 2,355,513  
  
 
 
     
 
 
  
As of March 30, 2024 and December 31, 2023, the Company had a total amount available to borrow under the Credit Facility of $1.2 billion and $0.9 billion, respectively, after outstanding letters of credit. The weighted-average interest rates applicable to the senior unsecured notes and credit agreement borrowings collectively were 4.42% and 4.69% at March 30, 2024 and December 31, 2023, respectively. As of March 30, 2024, the Company was in compliance with all debt
covenants.
 
 
The Company and its foreign subsidiaries also had available short-term lines of credit totaling $112 million and $114 million at March 30, 2024
and
December 31, 2023, respectively, for the purpose of short-term borrowing and issuance of commercial guarantees. None of the Company’s foreign subsidiaries had outstanding short-term borrowings as of March 30, 2024 or December 31, 2023.
v3.24.1.u1
Income Taxes
 3 Months Ended
Mar. 30, 2024
Income Tax Disclosure [Abstract]  
Income Taxes
7 Income Taxes
The four principal jurisdictions in which the Company manufactures are the U.S., Ireland, the U.K. and Singapore, where the statutory tax rates were 21%, 12.5%, 25% and 17%, respectively, as of March 30, 2024. The Company has a Development and Expansion Incentive in Singapore that provides a concessionary income tax rate of 5%
on certain types of income for the period April 1, 2021 through March 31, 2026. The effect of applying the concessionary income tax rate rather than the statutory tax rate to income arising from qualifying activities in Singapore increased the Company’s net income for the three months ended March 30, 2024 and April 1, 2023 by $2 million
and $
3 
million, respectively, and increased the Company’s net income per diluted
 
share by $0.03 and $0.05, respectively.
The Company’s effective tax rate for the three months ended March 30, 2024 and April 1, 2023 was 11.0% and 14.7%, respectively. The income tax provision includes a $1 million and a $2 
million income tax benefit related to stock-based compensation for the three months ended March 30, 2024 and April 1, 2023, respectively. The remaining differences between the effective tax rates can primarily be attributed to the impact of discrete tax benefits in the current year and differences in the proportionate amounts of
pre-tax
income recognized in jurisdictions with different effective tax rates.
The Company accounts for its uncertain tax return positions in accordance with the accounting standards for income taxes, which require financial statement reporting of the expected future tax consequences of uncertain tax reporting positions on the presumption that all concerned tax authorities possess full knowledge of those tax reporting positions, as well as all of the pertinent facts and circumstances, but prohibit any discounting of unrecognized tax benefits associated with those reporting positions for the time value of money. The Company continues to classify interest and penalties related to unrecognized tax benefits as a component of the provision for income taxes.
The Company’s gross unrecognized tax benefits, excluding interest and penalties, at March 30, 2024 and April 1, 2023 were $15 million and $30 
million, respectively. With limited exceptions, the Company is no longer subject to tax audit examinations in significant jurisdictions for the years ended on or before December 31, 2018. The Company continuously monitors the lapsing of statutes of limitations on potential tax assessments for related changes in the measurement of unrecognized tax benefits, related net interest and penalties, and deferred tax assets and liabilities.
Effective in 2024, various foreign jurisdictions began implementing aspects of the guidance issued by the Organization for
Economic Co-operation and
Development related to the new Pillar Two system of global minimum tax rules. These changes in tax law did not have a material impact on the Company’s financial position, results of operations and cash flows for the first quarter of 2024. The Company continues to monitor the adoption of the Pillar Two rules in additional jurisdictions.
v3.24.1.u1
Litigation
 3 Months Ended
Mar. 30, 2024
Litigation Settlement [Abstract]  
Litigation
8 Litigation
From time to time, the Company and its subsidiaries are involved in various litigation matters arising in the ordinary course of business. The Company believes it has meritorious arguments in its current litigation matters and believes any outcome, either individually or in the aggregate, will not be material to the Company’s financial position, results of operations or cash flows. During the three months ended March 30, 2024, the Company recorded
$10 
million of patent litigation settlement provisions and related costs. The accrued patent litigation expense is in other current liabilities in the consolidated balance sheet at March 30, 2024.
v3.24.1.u1
Other Commitments and Contingencies
 3 Months Ended
Mar. 30, 2024
Commitments and Contingencies Disclosure [Abstract]  
Other Commitments and Contingencies
9 Other Commitments and Contingencies
The Company licenses certain technology and software from third parties in the course of ordinary business. Future minimum license fees payable under existing license agreements as of March 30, 2024 are immaterial for the years ended December 31, 2024 and thereafter.

 
The Company enters into standard indemnification agreements in its ordinary course of business. Pursuant to these agreements, the Company indemnifies, holds harmless and agrees to reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally the Company’s business partners or customers, in connection with patent, copyright or other intellectual property infringement claims by any third party with respect to its current products, as well as claims relating to property damage or personal injury resulting from the performance of services by the Company or its subcontractors. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited. Historically, the Company’s costs to defend lawsuits or settle claims relating to such indemnity agreements have been minimal and management accordingly believes the estimated fair value of these agreements is immaterial.
v3.24.1.u1
Earnings Per Share
 3 Months Ended
Mar. 30, 2024
Earnings Per Share [Abstract]  
Earnings Per Share
10 Earnings Per Share
Basic and diluted EPS calculations are detailed as follows (in thousands, except per share data): 
 
 
  
Three Months Ended March 30, 2024
 
 
  
Net Income
(Numerator)
 
  
Weighted-
Average Shares
(Denominator)
 
  
Per Share
Amount
 
Net income per basic common share
    $ 102,196        59,232      $ 1.73  
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities
      —         199        (0.01 ) 
  
 
 
     
 
 
     
 
 
  
Net income per diluted common share
    $ 102,196        59,431      $ 1.72  
  
 
 
     
 
 
     
 
 
  
 
 
  
Three Months Ended April 1, 2023
 
 
  
Net Income
(Numerator)
 
  
Weighted-
Average Shares
(Denominator)
 
  
Per Share
Amount
 
Net income per basic common share
    $ 140,923        59,023      $ 2.39  
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities
      —         294        (0.01 ) 
  
 
 
     
 
 
     
 
 
  
Net income per diluted common share
    $ 140,923        59,317      $ 2.38  
  
 
 
     
 
 
     
 
 
  
For the three months ended March 30, 2024 and April 1, 2023, the
Company had approximately
 326,000 
and approximately
 140,000 
stock options that were antidilutive, respectively, due to having higher exercise prices than the Company’s average stock price during the applicable period. These securities were not included in the computation of diluted EPS. The effect of dilutive securities was calculated using the treasury stock method.
v3.24.1.u1
Accumulated Other Comprehensive Loss
 3 Months Ended
Mar. 30, 2024
Equity [Abstract]  
Accumulated Other Comprehensive Loss
11 Accumulated Other Comprehensive Loss
The components of accumulated other comprehensive loss are detailed as follows (in thousands):
 
 
  
Currency
Translation
 
  
Unrealized
Loss on
Retirement
Plans
 
  
Unrealized
Loss on
Derivative
Instruments
 
  
Accumulated
Other
Comprehensive
Loss
 
Balance at December 31, 2023
    $ (128,359 )    $ (3,501 )    $ (2,260 )    $ (134,120 ) 
Other comprehensive income (loss), net of tax
      (9,540 )      175       1,602       (7,763 ) 
  
 
 
    
 
 
    
 
 
    
 
 
  
Balance at March 30, 2024
    $ (137,899 )    $ (3,326 )    $ (658 )    $ (141,883 ) 
  
 
 
    
 
 
    
 
 
    
 
 
  
v3.24.1.u1
Business Segment Information
 3 Months Ended
Mar. 30, 2024
Segment Reporting [Abstract]  
Business Segment Information
12 Business Segment Information
The Company’s business activities, for which discrete financial information is available, are regularly reviewed and evaluated by the chief operating decision maker. As a result of this evaluation, the Company determined that it has two operating segments:
Waters
TM
and TA
TM
.
The
 
Waters operating segment is primarily in the business of designing, manufacturing, selling and servicing LC and MS instruments, columns and other precision chemistry consumables that can be integrated and used along with other analytical instruments. Operations of the Wyatt business are part of the Waters operating segment. The TA operating segment is primarily in the business of designing, manufacturing, selling and servicing thermal analysis, rheometry and calorimetry instruments. The Company’s two operating segments have similar economic characteristics; product processes; products and services; types and classes of customers; methods of distribution; and regulatory environments. Because of these similarities, the two segments have been aggregated into
 
one
reporting segment for financial statement purposes.
Net sales for the Company’s products and services are as follows for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Product net sales:
      
Waters instrument systems
    $ 191,259      $ 244,211  
Chemistry consumables
      134,207        133,515  
TA instrument systems
      50,685        58,731  
  
 
 
     
 
 
  
Total product sales
      376,151        436,457  
Service net sales:
      
Waters service
      236,433        224,349  
TA service
      24,255        23,868  
  
 
 
     
 
 
  
Total service sales
      260,688        248,217  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
 
Net sales are attributable to geographic areas based on the region of destination. Geographic sales information is presented below for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Net Sales:
      
Asia:
      
China
    $ 85,745      $ 116,065  
Japan
      35,547        46,494  
Asia Other
      86,267        90,522  
  
 
 
     
 
 
  
Total Asia
      207,559        253,081  
Americas:
      
United States
      202,839        202,305  
Americas Other
      38,332        44,116  
  
 
 
     
 
 
  
Total Americas
      241,171        246,421  
Europe
      188,109        185,172  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
Net sales by customer class are as follows for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Pharmaceutical
    $ 374,207      $ 384,898  
Industrial
      195,334        209,650  
Academic and government
      67,298        90,126  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
Net sales for the Company recognized at a point in time versus over time are as follows for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Net sales recognized at a point in time:
      
Instrument systems
    $ 241,944      $ 302,942  
Chemistry consumables
      134,207        133,515  
Service sales recognized at a point in time (time & materials)
      83,325        88,207  
  
 
 
     
 
 
  
Total net sales recognized at a point in time
      459,476        524,664  
Net sales recognized over time:
      
Service and software maintenance sales recognized over time (contracts)
      177,363        160,010  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
v3.24.1.u1
Recent Accounting Standard Changes and Developments
 3 Months Ended
Mar. 30, 2024
Accounting Changes and Error Corrections [Abstract]  
Recent Accounting Standard Changes and Developments
13 Recent Accounting Standard Changes and Developments
Recently Issued Accounting Standards
There were no additions to the new accounting pronouncements not yet adopted as described in our Annual Report on Form
10-K
for the year ended December 31, 2023. Other amendments to U.S. GAAP that have been issued by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our condensed consolidated financial statements upon adoption.
 
v3.24.1.u1
Basis of Presentation and Summary of Significant Accounting Policies (Policies)
 3 Months Ended
Mar. 30, 2024
Accounting Policies [Abstract]  
Risks and Uncertainties
Risks and Uncertainties
The Company is subject to risks common to companies in the analytical instrument industry, including, but not limited to, global economic and financial market conditions, fluctuations in foreign currency exchange rates, fluctuations in customer demand, development by its competitors of new technological innovations, costs of developing new technologies, levels of debt and debt service requirements, risk of disruption, dependence on key personnel, protection and litigation of proprietary technology, shifts in taxable income between tax jurisdictions and compliance with regulations of the U.S. Food and Drug Administration and similar foreign regulatory authorities and agencies.
Translation of Foreign Currencies
Translation of Foreign Currencies
The functional currency of each of the Company’s foreign operating subsidiaries is the local currency of its country of domicile, except for the Company’s subsidiaries in Hong Kong, Singapore and the Cayman Islands, where the underlying transactional cash flows are denominated in currencies other than the respective local currency of domicile. The functional currency of the Hong Kong, Singapore and Cayman Islands subsidiaries is the U.S. dollar, based on the respective entity’s cash flows.
For the Company’s foreign operations, assets and liabilities are translated into U.S. dollars at exchange rates prevailing on the balance sheet date, while revenues and expenses are translated at average exchange rates prevailing during the respective period. Any resulting translation gains or losses are included in accumulated other comprehensive loss in the consolidated balance sheets.
Cash, Cash Equivalents and Investments
Cash, Cash Equivalents and Investments
Cash equivalents represent highly liquid investments, with original maturities of 90 days or less, while investments with longer maturities are classified as investments. The Company maintains cash balances in various operating accounts in excess of federally insured limits, and in foreign subsidiary accounts in currencies other than the U.S. dollar. As of March 30, 2024 and December 31, 2023, $305 million out of $338 million and $321 million out of $396 million, respectively, of the Company’s total cash, cash equivalents and investments were held by foreign subsidiaries. In addition, $239 million out of $338 million and $233 million out of $396 million of cash, cash equivalents and investments were held in currencies
other
than the U.S. dollar at March 30, 2024 and December 31, 2023, respectively.
Accounts Receivable and Allowance for Credit Losses
Accounts Receivable and Allowance for Credit Losses
Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The Company has very limited use of rebates and other cash considerations payable to customers and, as a result, the transaction price determination does not have any material variable consideration. The Company does not consider there to be significant concentrations of credit risk with respect to trade receivables due to the short-term nature of the balances, the Company having a large and diverse customer base, and the Company having a strong historical experience of collecting receivables with minimal defaults. As a result, credit risk is considered low across territories and trade receivables are considered to be a single class of financial asset. The allowance for credit losses is based on a number of factors and is calculated by applying a historical loss rate to trade receivable aging balances to estimate a general reserve balance along with an additional adjustment for any specific receivables with known or anticipated issues affecting the likelihood of recovery. Past due balances with a probability of default based on historical data as well as relevant available forward-looking information are included in the specific adjustment. The historical loss rate is reviewed on at least an annual basis and the allowance for credit losses is reviewed quarterly for any required adjustments. The Company does not have any
off-balance
sheet credit exposure related to its customers.
Trade receivables related to instrument sales are collateralized by the instrument that is sold. If there is a risk of default related to a receivable that is collateralized, then the fair value of the collateral is calculated and adjusted for the cost to
re-possess,
refurbish and
re-sell
the instrument. This adjusted fair value is compared to the receivable balance and the difference would be recorded as the expected credit loss.
 
The following is a summary of the activity of the Company’s allowance for credit losses for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
 
 
  
Balance at
Beginning of
Period
 
  
Additions
 
  
Deductions and
Other
 
  
Balance at End
of Period
 
Allowance for Credit Losses
            
March 30, 2024
    $ 19,335      $ 991      $ (5,461 )    $ 14,865  
April 1, 2023
    $ 14,311      $ 1,572      $ (1,028 )     $ 14,855  
Fair Value Measurements
Fair Value Measurements
In accordance with the accounting standards for fair value measurements and disclosures, certain of the Company’s assets and liabilities are measured at fair value on a recurring basis as of March 30, 2024 and December 31, 2023. Fair values determined by Level 1 inputs utilize observable data, such as quoted prices in active markets. Fair values determined by Level 2 inputs utilize data points other than quoted prices in active markets that are observable either directly or indirectly. Fair values determined by Level 3 inputs utilize unobservable data points for which there is little or no market data, which require the reporting entity to develop its own assumptions.
The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis at March 30, 2024 (in thousands):
 
 
  
Total at
March 30,
2024
 
  
Quoted Prices
in Active
Markets

for Identical
Assets

(Level 1)
 
  
Significant
Other
Observable
Inputs
(Level 2)
 
  
Significant
Unobservable
Inputs

(Level 3)
 
Assets:
  
  
  
  
Time deposits
    $ 923      $ —       $ 923      $ —   
Waters 401(k) Restoration Plan assets
      30,791        30,791        —         —   
Interest rate cross-currency swap agreements
      7,642        —         7,642        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 39,356      $ 30,791      $ 8,565      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Liabilities:
            
Foreign currency exchange contracts
    $ 75      $ —       $ 75      $ —   
Interest rate cross-currency swap agreements
      5,510        —         5,510        —   
Interest rate swap cash flow hedge
      865        —         865        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 6,450      $ —       $ 6,450      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis at December 31, 2023 (in thousands):
 
  
Total at
December 31,
2023
 
  
Quoted Prices
in Active
Markets

for Identical
Assets

(Level 1)
 
  
Significant
Other
Observable
Inputs
(Level 2)
 
  
Significant
Unobservable
Inputs

(Level 3)
 
Assets:
  
  
  
  
Time deposits
    $ 898      $ —       $ 898      $ —   
Waters 401(k) Restoration Plan assets
      28,995        28,995        —         —   
Foreign currency exchange contracts
      183        —         183        —   
Interest rate cross-currency swap agreements
      4,835        —         4,835        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 34,911      $ 28,995      $ 5,916      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Liabilities:
            
Foreign currency exchange contracts
      207        —         207        —   
Interest rate cross-currency swap agreements
      13,384        —         13,384        —   
Interest rate swap cash flow hedge
      2,974        —         2,974        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 16,565      $ —       $ 16,565      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Fair Value of 401(k) Restoration Plan Assets
The 401(k) Restoration Plan is a nonqualified defined contribution plan and the assets were held in registered mutual funds and have been classified as Level 1. The fair values of the assets in the plan are determined through market and observable sources from daily quoted prices on nationally recognized securities exchanges.
Fair Value of Cash Equivalents, Investments, Foreign Currency Exchange Contracts, Interest Rate Cross-Currency Swap Agreements and Interest Rate Swap Cash Flow Hedges
The fair values of the Company’s cash equivalents, investments, foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap cash flow hedges are determined through market and observable sources and have been classified as Level 2. These assets and liabilities have been initially valued at the transaction price and subsequently valued, typically utilizing third-party pricing services. The pricing services use many inputs to determine value, including reportable trades, benchmark yields, credit spreads, broker/dealer quotes, current spot rates and other industry and economic events. The Company validates the prices provided by third-party pricing services by reviewing their pricing methods and obtaining market values from other pricing sources.
Fair Value of Other Financial Instruments
The Company’s accounts receivable and accounts payable are recorded at cost, which approximates fair value due to their short-term nature. The carrying value of the Company’s variable interest rate debt approximates fair value due to the variable nature of the interest rate. The carrying value of the Company’s fixed interest rate debt was $1.3 billion at both March 30, 2024 and December 31, 2023. The fair value of the Company’s fixed interest rate debt was estimated using discounted cash flow models, based on estimated current rates offered for similar debt under current market conditions for the Company. The fair value of the Company’s fixed interest rate debt was estimated to be $1.2 billion at both March 30, 2024 and December 31, 2023, using Level 2 inputs.
Derivative Transactions
Derivative Transactions
The Company is a global company that operates in over 35 countries and, as a result, the Company’s net sales, cost of sales, operating expenses and balance sheet amounts are significantly impacted by fluctuations in foreign currency exchange rates. The Company is exposed to currency price risk on foreign currency exchange rate fluctuations when it translates its
non-U.S.
dollar foreign subsidiaries’ financial statements into U.S. dollars and when any of the Company’s subsidiaries purchase or sell products or services in a currency other than its own
currency.
 
 
The Company’s principal strategies in managing exposures to changes in foreign currency exchange rates are to (1) naturally hedge the foreign-currency-denominated liabilities on the Company’s balance sheet against corresponding assets of the same currency, such that any changes in liabilities due to fluctuations in foreign currency exchange rates are typically offset by corresponding changes in assets and (2) mitigate foreign exchange risk exposure of international operations by hedging the variability in the movement of foreign currency exchange rates on a portion of its euro-denominated and
yen-denominated
net asset investments. The Company presents the derivative transactions in financing activities in the statement of cash flows.
Foreign Currency Exchange Contracts
The Company does not specifically enter into any derivatives that hedge foreign-currency-denominated operating assets, liabilities or commitments on its balance sheet, other than a portion of certain third-party accounts receivable and accounts payable, and the Company’s net worldwide intercompany receivables and payables, which are eliminated in consolidation. The Company periodically aggregates its net worldwide balances by currency and then enters into foreign currency exchange contracts that mature within 90 days to hedge a portion of the remaining balance to minimize some of the Company’s currency price risk exposure. The foreign currency exchange contracts are not designated for hedge accounting treatment. Principal hedged currencies include the euro, Japanese yen, British pound, Mexican peso and Brazilian real.
Cash Flow Hedges
The Company’s Credit Facility is a variable borrowing and has interest payments based on a contractually specified interest rate index. The contractually specified index on the Credit Facility is the
3-month
Term SOFR. The variable rate interest payments create interest risk for the Company as interest payments will fluctuate based on changes in the contractually specified interest rate index over the life of the Credit Facility. In order to reduce interest rate risk, the Company enters into interest rate swaps that will effectively
lock-in
the forecasted interest payments on the variable rate borrowing over its term. The interest rate swaps represent cash flow hedges and are assessed for hedge effectiveness each reporting period. When the hedge relationship is highly effective at achieving offsetting changes in cash flows, the Company will record the entire change in fair value of the interest rate swaps in accumulated other comprehensive loss. The amount in accumulated other comprehensive loss is reclassified to income in the period that the underlying transaction impacts consolidated income. If it becomes probable that the forecasted transaction will not occur, the hedge relationship will be
de-designated
and amounts accumulated in other comprehensive loss will be reclassified to income in the current period. Interest settlements due to benchmark interest rate changes are recorded in interest income or interest expense. For the three months ended March 30, 2024, the Company did not have any cash flow hedges that were deemed ineffective.
Interest Rate Cross-Currency Swap Agreements
As of March 30, 2024, the Company had entered into interest rate cross-currency swap derivative agreements with durations up to three years with an aggregate notional value of $625 million to hedge the variability in the movement of foreign currency exchange rates on a portion of its euro-denominated and
yen-denominated
net asset investments. Under hedge accounting, the change in fair value of the derivative that relates to changes in the foreign currency spot rate are recorded in the currency translation adjustment in other comprehensive income and remain in accumulated other comprehensive loss in stockholders’ equity until the sale or substantial liquidation of the foreign operation. The difference between the interest rate received and paid under the interest rate cross-currency swap derivative agreement is recorded in interest income in the statement of operations.
 
The Company’s foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap agreements designated as cash flow hedges are included in the consolidated balance sheets are classified as follows (in thousands):
                                 
 
  
March 30, 2024
 
  
December 31, 2023
 
 
  
Notional
 
  
Fair Value
 
  
Notional
 
  
Fair Value
 
Foreign currency exchange contracts:
  
      
  
      
  
      
  
      
Other current assets
    $ 5,000      $ —       $ 24,155      $ 183  
Other current liabilities
    $ 35,314      $ 75      $ 16,000      $ 207  
Interest rate cross-currency swap agreements:
            
Other assets
    $ 285,000      $ 7,642      $ 220,000      $ 4,835  
Other liabilities
    $ 340,000      $ 5,510      $ 405,000      $ 13,384  
Accumulated other comprehensive income (loss)
       $ 6,942         $ (7,975 ) 
Interest rate swap cash flow hedges:
            
Other liabilities
    $ 100,000      $ 865      $ 100,000      $ 2,974  
Accumulated other comprehensive loss
       $ (865 )        $ (2,974 ) 
The following is a summary of the activity included in the consolidated statements of operations and statements of comprehensive income related to the foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap agreements designated as cash flow hedges (in thousands):

    
Financial

Statement
Classification
   
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Foreign currency exchange contracts:
      
Realized gains on closed contracts
    Cost of sales    $ 257      $ 30  
Unrealized losses on open contracts
    Cost of sales      (51 )       (78 ) 
     
 
 
     
 
 
  
Cumulative net
pre-tax
gains (losses)
    Cost of sales    $ 206      $ (48 ) 
     
 
 
     
 
 
  
Interest rate cross-currency swap agreements:
      
Interest earned
    Interest income    $ 2,537      $ 2,655  
Unrealized gains (losses) on contracts, net
    Accumulated other
comprehensive loss		    $ 14,917      $ (7,256 ) 
Interest rate swap cash flow hedges:
      
Interest earned
    Interest income    $ 296      $ —   
Unrealized gains on
    Accumulated other      
open contracts
    comprehensive loss    $ 2,109      $ —   
Cash Flow Hedges
Cash Flow Hedges
The Company’s Credit Facility is a variable borrowing and has interest payments based on a contractually specified interest rate index. The contractually specified index on the Credit Facility is the
3-month
Term SOFR. The variable rate interest payments create interest risk for the Company as interest payments will fluctuate based on changes in the contractually specified interest rate index over the life of the Credit Facility. In order to reduce interest rate risk, the Company enters into interest rate swaps that will effectively
lock-in
the forecasted interest payments on the variable rate borrowing over its term. The interest rate swaps represent cash flow hedges and are assessed for hedge effectiveness each reporting period. When the hedge relationship is highly effective at achieving offsetting changes in cash flows, the Company will record the entire change in fair value of the interest rate swaps in accumulated other comprehensive loss. The amount in accumulated other comprehensive loss is reclassified to income in the period that the underlying transaction impacts consolidated income. If it becomes probable that the forecasted transaction will not occur, the hedge relationship will be
de-designated
and amounts accumulated in other comprehensive loss will be reclassified to income in the current period. Interest settlements due to benchmark interest rate changes are recorded in interest income or interest expense. For the three months ended March 30, 2024, the Company did not have any cash flow hedges that were deemed ineffective.
Stockholders' Equity
Stockholders’ Equity
In December 2023, the Company’s Board of Directors authorized the extension of its existing share repurchase program through January 21, 2025. The Company’s remaining authorization is $1.0 billion. During the three months ended April 1, 2023, the Company
 
repurchased 0.2 
million shares of the Company’s outstanding common stock at a cost of
$58 
million under the Company’s share repurchase program. The Company did not make any open market share repurchases in 2024. In addition, the Company repurchased
$13 million and $11 million of common stock related to the vesting of restricted stock units during the three months ended March 30, 2024 and April 1, 2023, respectively.
Product Warranty Costs
Product Warranty Costs
The Company accrues estimated product warranty costs at the time of sale, which are included in cost of sales in the consolidated statements of operations. While the Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers, the Company’s warranty obligation is affected by product failure rates, material usage and service delivery costs incurred in correcting a product failure. The amount of the accrued warranty liability is based on historical information, such as past experience, product failure rates, number of units repaired and estimated costs of material and labor. The liability is reviewed for reasonableness at least quarterly.
The following is a summary of the activity of the Company’s accrued warranty liability for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Balance at
Beginning
of Period
     
Accruals for
Warranties
     
Settlements
Made
     
Balance at
End of
Period
  
Accrued warranty liability:
            
March 30, 2024
    $ 12,050      $ 480      $ (1,677 )     $ 10,853  
April 1, 2023
    $ 11,949      $ 2,177      $ (1,815 )     $ 12,311  
Restructuring
Restructuring
In March 2024, the Company had a reduction in workforce that impacted approximately 2% of the employees, primarily in China due to the significant decline in sales resulting from lower customer demand, which resulted in the Company incurring approximately $8 million of severance-related costs. During the first quarter of 2024, the Company paid $8 
million of severance-related costs in connection with the workforce reductions that occurred in March 2024 and July 2023, with the majority of the remaining costs to be paid in the second quarter of 2024. The accrued restructuring expense was $8 million at both March 30, 2024 and December 31, 2023 and were included in other current liabilities on the consolidated balance sheets.
v3.24.1.u1
Basis of Presentation and Summary of Significant Accounting Policies (Tables)
 3 Months Ended
Mar. 30, 2024
Accounting Policies [Abstract]  
Summary of Activity of Company's Allowance for Doubtful Accounts
 
The following is a summary of the activity of the Company’s allowance for credit losses for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
 
 
  
Balance at
Beginning of
Period
 
  
Additions
 
  
Deductions and
Other
 
  
Balance at End
of Period
 
Allowance for Credit Losses
            
March 30, 2024
    $ 19,335      $ 991      $ (5,461 )    $ 14,865  
April 1, 2023
    $ 14,311      $ 1,572      $ (1,028 )     $ 14,855  
Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis
The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis at March 30, 2024 (in thousands):
 
 
  
Total at
March 30,
2024
 
  
Quoted Prices
in Active
Markets

for Identical
Assets

(Level 1)
 
  
Significant
Other
Observable
Inputs
(Level 2)
 
  
Significant
Unobservable
Inputs

(Level 3)
 
Assets:
  
  
  
  
Time deposits
    $ 923      $ —       $ 923      $ —   
Waters 401(k) Restoration Plan assets
      30,791        30,791        —         —   
Interest rate cross-currency swap agreements
      7,642        —         7,642        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 39,356      $ 30,791      $ 8,565      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Liabilities:
            
Foreign currency exchange contracts
    $ 75      $ —       $ 75      $ —   
Interest rate cross-currency swap agreements
      5,510        —         5,510        —   
Interest rate swap cash flow hedge
      865        —         865        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 6,450      $ —       $ 6,450      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis at December 31, 2023 (in thousands):
 
  
Total at
December 31,
2023
 
  
Quoted Prices
in Active
Markets

for Identical
Assets

(Level 1)
 
  
Significant
Other
Observable
Inputs
(Level 2)
 
  
Significant
Unobservable
Inputs

(Level 3)
 
Assets:
  
  
  
  
Time deposits
    $ 898      $ —       $ 898      $ —   
Waters 401(k) Restoration Plan assets
      28,995        28,995        —         —   
Foreign currency exchange contracts
      183        —         183        —   
Interest rate cross-currency swap agreements
      4,835        —         4,835        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 34,911      $ 28,995      $ 5,916      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Liabilities:
            
Foreign currency exchange contracts
      207        —         207        —   
Interest rate cross-currency swap agreements
      13,384        —         13,384        —   
Interest rate swap cash flow hedge
      2,974        —         2,974        —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Total
    $ 16,565      $ —       $ 16,565      $ —   
  
 
 
     
 
 
     
 
 
     
 
 
  
Summary of Foreign Currency Exchange Contracts and Interest Rate Cross-Currency Swap Agreements
The Company’s foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap agreements designated as cash flow hedges are included in the consolidated balance sheets are classified as follows (in thousands):
                                 
 
  
March 30, 2024
 
  
December 31, 2023
 
 
  
Notional
 
  
Fair Value
 
  
Notional
 
  
Fair Value
 
Foreign currency exchange contracts:
  
      
  
      
  
      
  
      
Other current assets
    $ 5,000      $ —       $ 24,155      $ 183  
Other current liabilities
    $ 35,314      $ 75      $ 16,000      $ 207  
Interest rate cross-currency swap agreements:
            
Other assets
    $ 285,000      $ 7,642      $ 220,000      $ 4,835  
Other liabilities
    $ 340,000      $ 5,510      $ 405,000      $ 13,384  
Accumulated other comprehensive income (loss)
       $ 6,942         $ (7,975 ) 
Interest rate swap cash flow hedges:
            
Other liabilities
    $ 100,000      $ 865      $ 100,000      $ 2,974  
Accumulated other comprehensive loss
       $ (865 )        $ (2,974 ) 
Gains (Losses) on Foreign Exchange Contracts
The following is a summary of the activity included in the consolidated statements of operations and statements of comprehensive income related to the foreign currency exchange contracts, interest rate cross-currency swap agreements and interest rate swap agreements designated as cash flow hedges (in thousands):

    
Financial

Statement
Classification
   
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Foreign currency exchange contracts:
      
Realized gains on closed contracts
    Cost of sales    $ 257      $ 30  
Unrealized losses on open contracts
    Cost of sales      (51 )       (78 ) 
     
 
 
     
 
 
  
Cumulative net
pre-tax
gains (losses)
    Cost of sales    $ 206      $ (48 ) 
     
 
 
     
 
 
  
Interest rate cross-currency swap agreements:
      
Interest earned
    Interest income    $ 2,537      $ 2,655  
Unrealized gains (losses) on contracts, net
    Accumulated other
comprehensive loss		    $ 14,917      $ (7,256 ) 
Interest rate swap cash flow hedges:
      
Interest earned
    Interest income    $ 296      $ —   
Unrealized gains on
    Accumulated other      
open contracts
    comprehensive loss    $ 2,109      $ —   
Summary of Activity of Company's Accrued Warranty Liability
The following is a summary of the activity of the Company’s accrued warranty liability for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Balance at
Beginning
of Period
     
Accruals for
Warranties
     
Settlements
Made
     
Balance at
End of
Period
  
Accrued warranty liability:
            
March 30, 2024
    $ 12,050      $ 480      $ (1,677 )     $ 10,853  
April 1, 2023
    $ 11,949      $ 2,177      $ (1,815 )     $ 12,311  
v3.24.1.u1
Revenue Recognition (Tables)
 3 Months Ended
Mar. 30, 2024
Revenue from Contract with Customer [Abstract]  
Summary of Activity of Deferred Revenue and Customer Advances
The following is a summary of the activity of the Company’s deferred revenue and customer advances for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
March 30, 2024
     
April 1, 2023
  
Balance at the beginning of the period
    $ 323,516      $ 285,175  
Recognition of revenue included in balance at beginning of the period
      (103,996 )       (105,222 ) 
Revenue deferred during the period, net of revenue recognized
      187,525        193,286  
  
 
 
     
 
 
  
Balance at the end of the period
    $ 407,045      $ 373,239  
  
 
 
     
 
 
  
Schedule of Amount of Deferred Revenue and Customer Advances
The amount of deferred revenue and customer advances equals the transaction price allocated to unfulfilled performance obligations for the period presented. Such amounts are expected to be recognized in the future as follows (in thousands):
 
    
March 30, 2024
  
Deferred revenue and customer advances expected to be recognized in:
   
One year or less
    $ 336,718  
13-24
months
      42,162  
25 months and beyond
      28,165  
  
 
 
  
Total
    $ 407,045  
  
 
 
  
v3.24.1.u1
Inventories (Tables)
 3 Months Ended
Mar. 30, 2024
Inventory Disclosure [Abstract]  
Inventory, Net of Reserves
Inventories are classified as follows (in thousands):
 
    
March 30, 2024
     
December 31, 2023
  
Raw materials
    $ 241,744      $ 233,952  
Work in progress
      23,825        20,198  
Finished goods
      273,065        262,086  
  
 
 
     
 
 
  
Total inventories
    $ 538,634      $ 516,236  
  
 
 
     
 
 
  
v3.24.1.u1
Goodwill and Other Intangibles (Tables)
 3 Months Ended
Mar. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Intangible Assets
The Company’s intangible assets included in the consolidated balance sheets are detailed as follows (dollars in thousands):

 
  
March 30, 2024
 
  
December 31, 2023
 
 
  
Gross
Carrying
Amount
 
  
Accumulated
Amortization
 
  
Weighted-
Average
Amortization
Period
 
  
Gross
Carrying
Amount
 
  
Accumulated
Amortization
 
  
Weighted-
Average
Amortization
Period
 
Capitalized software
    $ 655,433      $ 495,177        5 years      $ 660,273      $ 495,317        5
 
years		  
Purchased intangibles
      612,382        207,620        10 years        614,357        197,154        10 years  
Trademarks
      9,680        —         —         9,680        —         —   
Licenses
      14,673        8,698        7 years        14,798        8,429        7 years  
Patents and other intangibles
      113,028        82,554        8 years        111,962        80,983        8 years  
  
 
 
     
 
 
        
 
 
     
 
 
     
Total
    $ 1,405,196      $ 794,049        7 years      $ 1,411,070      $ 781,883        7 years  
  
 
 
     
 
 
        
 
 
     
 
 
     
v3.24.1.u1
Debt (Tables)
 3 Months Ended
Mar. 30, 2024
Debt Disclosure [Abstract]  
Summary of Outstanding Debt
The Company had the following outstanding debt at March 30, 2024 and December 31, 2023 (in thousands):
 
    
March 30, 2024
     
December 31, 2023
  
Senior unsecured notes - Series G -
3.92
%, due June 2024
      50,000        50,000  
  
 
 
     
 
 
  
Total notes payable and debt, current
      50,000        50,000  
Senior unsecured notes - Series K - 3.44%, due May 2026
      160,000        160,000  
Senior unsecured notes - Series L - 3.31%, due September 2026
      200,000        200,000  
Senior unsecured notes - Series M - 3.53%, due September 2029
      300,000        300,000  
Senior unsecured notes - Series N - 1.68%, due March 2026
      100,000        100,000  
Senior unsecured notes - Series O - 2.25%, due March 2031
      400,000        400,000  
Senior unsecured notes - Series P - 4.91%, due May 2028
      50,000        50,000  
Senior unsecured notes - Series Q - 4.91%, due May 2030
      50,000        50,000  
Credit agreement
      750,000        1,050,000  
Unamortized debt issuance costs
      (4,239 )       (4,487 ) 
  
 
 
     
 
 
  
Total long-term debt
      2,005,761        2,305,513  
  
 
 
     
 
 
  
Total debt
    $ 2,055,761      $ 2,355,513  
  
 
 
     
 
 
  
v3.24.1.u1
Earnings Per Share (Tables)
 3 Months Ended
Mar. 30, 2024
Earnings Per Share [Abstract]  
Earnings Per Share Reconciliation
Basic and diluted EPS calculations are detailed as follows (in thousands, except per share data): 
 
 
  
Three Months Ended March 30, 2024
 
 
  
Net Income
(Numerator)
 
  
Weighted-
Average Shares
(Denominator)
 
  
Per Share
Amount
 
Net income per basic common share
    $ 102,196        59,232      $ 1.73  
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities
      —         199        (0.01 ) 
  
 
 
     
 
 
     
 
 
  
Net income per diluted common share
    $ 102,196        59,431      $ 1.72  
  
 
 
     
 
 
     
 
 
  
 
 
  
Three Months Ended April 1, 2023
 
 
  
Net Income
(Numerator)
 
  
Weighted-
Average Shares
(Denominator)
 
  
Per Share
Amount
 
Net income per basic common share
    $ 140,923        59,023      $ 2.39  
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities
      —         294        (0.01 ) 
  
 
 
     
 
 
     
 
 
  
Net income per diluted common share
    $ 140,923        59,317      $ 2.38  
  
 
 
     
 
 
     
 
 
  
v3.24.1.u1
Accumulated Other Comprehensive Loss (Tables)
 3 Months Ended
Mar. 30, 2024
Equity [Abstract]  
Schedule of Accumulated Other Comprehensive Income (Loss)
The components of accumulated other comprehensive loss are detailed as follows (in thousands):
 
 
  
Currency
Translation
 
  
Unrealized
Loss on
Retirement
Plans
 
  
Unrealized
Loss on
Derivative
Instruments
 
  
Accumulated
Other
Comprehensive
Loss
 
Balance at December 31, 2023
    $ (128,359 )    $ (3,501 )    $ (2,260 )    $ (134,120 ) 
Other comprehensive income (loss), net of tax
      (9,540 )      175       1,602       (7,763 ) 
  
 
 
    
 
 
    
 
 
    
 
 
  
Balance at March 30, 2024
    $ (137,899 )    $ (3,326 )    $ (658 )    $ (141,883 ) 
  
 
 
    
 
 
    
 
 
    
 
 
  
v3.24.1.u1
Business Segment Information (Tables)
 3 Months Ended
Mar. 30, 2024
Segment Reporting [Abstract]  
Summary of Net Sales for Company's Products and Services
Net sales for the Company’s products and services are as follows for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Product net sales:
      
Waters instrument systems
    $ 191,259      $ 244,211  
Chemistry consumables
      134,207        133,515  
TA instrument systems
      50,685        58,731  
  
 
 
     
 
 
  
Total product sales
      376,151        436,457  
Service net sales:
      
Waters service
      236,433        224,349  
TA service
      24,255        23,868  
  
 
 
     
 
 
  
Total service sales
      260,688        248,217  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
Summary of Geographic Sales Information
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Net Sales:
      
Asia:
      
China
    $ 85,745      $ 116,065  
Japan
      35,547        46,494  
Asia Other
      86,267        90,522  
  
 
 
     
 
 
  
Total Asia
      207,559        253,081  
Americas:
      
United States
      202,839        202,305  
Americas Other
      38,332        44,116  
  
 
 
     
 
 
  
Total Americas
      241,171        246,421  
Europe
      188,109        185,172  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
Summary of Net Sales by Customer Class
Net sales by customer class are as follows for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Pharmaceutical
    $ 374,207      $ 384,898  
Industrial
      195,334        209,650  
Academic and government
      67,298        90,126  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
Summary of Net Sales of Company Recognized at a Point in Time Versus Over Time
Net sales for the Company recognized at a point in time versus over time are as follows for the three months ended March 30, 2024 and April 1, 2023 (in thousands):
 
    
Three Months Ended
  
    
March 30, 2024
     
April 1, 2023
  
Net sales recognized at a point in time:
      
Instrument systems
    $ 241,944      $ 302,942  
Chemistry consumables
      134,207        133,515  
Service sales recognized at a point in time (time & materials)
      83,325        88,207  
  
 
 
     
 
 
  
Total net sales recognized at a point in time
      459,476        524,664  
Net sales recognized over time:
      
Service and software maintenance sales recognized over time (contracts)
      177,363        160,010  
  
 
 
     
 
 
  
Total net sales
    $ 636,839      $ 684,674  
  
 
 
     
 
 
  
v3.24.1.u1
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($)
shares in Millions
 1 Months Ended 3 Months Ended 12 Months Ended
May 16, 2023
Mar. 31, 2024
Mar. 30, 2024
Apr. 01, 2023
Dec. 31, 2023
Basis of Presentation and Summary of Significant Accounting Policies [Line Items]          
Cash equivalents description     Cash equivalents represent highly liquid investments, with original maturities of 90 days or less, while investments with longer maturities are classified as investments.    
Cash, cash equivalents and investments     $ 338,000,000   $ 396,000,000
Long-term debt   $ 2,005,761,000 $ 2,005,761,000   2,305,513,000
Foreign currency exposure     The Company is a global company that operates in over 35 countries and, as a result, the Company’s net sales, cost of sales, operating expenses and balance sheet amounts are significantly impacted by fluctuations in foreign currency exchange rates.    
Maturity period of foreign exchange contracts     The Company periodically aggregates its net worldwide balances by currency and then enters into foreign currency exchange contracts that mature within 90 days to hedge a portion of the remaining balance to minimize some of the Company’s currency price risk exposure. The foreign currency exchange contracts are not designated for hedge accounting treatment.    
Treasury stock     $ 13,089,000 $ 69,505,000  
Restructuring charges   $ 8,000,000     8,000,000
Percentage reduction in the workforce   2.00%      
Payment of severance costs     8,000,000    
Wyatt Technology [Member]          
Basis of Presentation and Summary of Significant Accounting Policies [Line Items]          
Payments to Acquire Businesses, Gross $ 1,300,000,000        
Cross Currency Interest Rate Contract [Member]          
Basis of Presentation and Summary of Significant Accounting Policies [Line Items]          
Notional value, derivative asset     625,000,000    
Programs Authorized by Board of Directors [Member]          
Basis of Presentation and Summary of Significant Accounting Policies [Line Items]          
Treasury stock shares acquired       0.2  
Treasury stock       $ 58,000,000  
Related to Vesting of Restricted Stock Units [Member]          
Basis of Presentation and Summary of Significant Accounting Policies [Line Items]          
Treasury stock     13,000,000 $ 11,000,000  
Held In Currencies Other Than Us Dollars [Member]          
Basis of Presentation and Summary of Significant Accounting Policies [Line Items]          
Cash, cash equivalents and investments     239,000,000   233,000,000
Unsecured Debt [Member]          
Basis of Presentation and Summary of Significant Accounting Policies [Line Items]          
Long-term debt   $ 1,300,000,000     1,300,000,000
Unsecured Debt [Member] | Fixed Interest Rate [Member]          
Basis of Presentation and Summary of Significant Accounting Policies [Line Items]          
Long-term debt   1,300,000,000     1,300,000,000
Fair value of fixed interest rate debt   $ 1,200,000,000     1,200,000,000
Held By Foreign Subsidiaries [Member]          
Basis of Presentation and Summary of Significant Accounting Policies [Line Items]          
Cash, cash equivalents and investments     $ 305,000,000   $ 321,000,000
v3.24.1.u1
Basis of Presentation and Summary of Significant Accounting Policies - Allowance for Doubtful Accounts Roll Forward (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Allowance for Doubtful Accounts Receivable [Roll Forward]    
Beginning balance $ 19,335 $ 14,311
Additions 991 1,572
Deductions and Other (5,461) (1,028)
Ending balance $ 14,865 $ 14,855
v3.24.1.u1
Basis of Presentation and Summary of Significant Accounting Policies - Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Waters 401(k) Restoration Plan assets $ 30,791 $ 28,995
Total 39,356 34,911
Total 6,450 16,565
Foreign Currency Exchange Contract [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Fair value, derivative asset   183
Foreign currency exchange contracts 75 207
Cross Currency Interest Rate Contract [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Fair value, derivative asset 7,642 4,835
Foreign currency exchange contracts 5,510 13,384
Interest Rate Swaps Cash Flow Hedges [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Foreign currency exchange contracts 865 2,974
Time Deposits [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available for sale securities 923 898
Significant Unobservable Inputs (Level 2) [Member] | Time Deposits [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available for sale securities 923 898
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Waters 401(k) Restoration Plan assets 30,791 28,995
Total 30,791 28,995
Total 0 0
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 2) [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total 8,565 5,916
Total 6,450 16,565
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 2) [Member] | Foreign Currency Exchange Contract [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Fair value, derivative asset   183
Foreign currency exchange contracts 75 207
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 2) [Member] | Cross Currency Interest Rate Contract [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Fair value, derivative asset 7,642 4,835
Foreign currency exchange contracts 5,510 13,384
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 2) [Member] | Interest Rate Swaps Cash Flow Hedges [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Foreign currency exchange contracts 865 2,974
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total 0 0
Total $ 0 $ 0
v3.24.1.u1
Basis of Presentation and Summary of Significant Accounting Policies - Fair Value of Forward Foreign Exchange Contracts (Detail) - USD ($)
Mar. 31, 2024
Mar. 30, 2024
Dec. 31, 2023
Foreign Currency Exchange Contract [Member]      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Fair value, derivative asset     $ 183,000
Fair value, derivative liability $ 75,000   207,000
Cross Currency Interest Rate Contract [Member]      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Notional , derivative asset   $ 625,000,000  
Fair value, derivative asset 7,642,000   4,835,000
Fair value, derivative liability 5,510,000   13,384,000
Interest Rate Swaps Cash Flow Hedges [Member]      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Fair value, derivative liability $ 865,000   2,974,000
Other Current Assets [Member] | Foreign Currency Exchange Contract [Member]      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Notional , derivative asset   5,000,000 24,155,000
Fair value, derivative asset     183,000
Other Current Liabilities [Member] | Foreign Currency Exchange Contract [Member]      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Notional , derivative liability   35,314,000 16,000,000
Fair value, derivative liability   75,000 207,000
Other Assets [Member] | Cross Currency Interest Rate Contract [Member]      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Notional , derivative asset   285,000,000 220,000,000
Fair value, derivative asset   7,642,000 4,835,000
Other Liabilities [Member] | Cross Currency Interest Rate Contract [Member]      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Notional , derivative liability   340,000,000 405,000,000
Fair value, derivative liability   5,510,000 13,384,000
Other Liabilities [Member] | Interest Rate Swaps Cash Flow Hedges [Member]      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Notional , derivative liability   100,000,000 100,000,000
Fair value, derivative liability   865,000 2,974,000
Accumulated Other Comprehensive (Loss) Income [Member] | Cross Currency Interest Rate Contract [Member]      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Fair value, derivative asset   6,942,000 (7,975,000)
Accumulated Other Comprehensive (Loss) Income [Member] | Interest Rate Swaps Cash Flow Hedges [Member]      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Fair value, derivative asset   $ (865,000) $ (2,974,000)
v3.24.1.u1
Basis of Presentation and Summary of Significant Accounting Policies - Gains (Losses) on Foreign Exchange Contracts (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Cross Currency Interest Rate Contract [Member]    
Derivative [Line Items]    
Interest earned $ 2,537 $ 2,655
Interest Rate Swaps Cash Flow Hedges [Member]    
Derivative [Line Items]    
Interest earned 296  
Unrealized gains (losses) on contracts, net 2,109  
Cost of Sales [Member] | Foreign Currency Exchange Contract [Member]    
Derivative [Line Items]    
Realized gains on closed contracts 257 30
Unrealized losses on open contracts (51) (78)
Cumulative net pre-tax gains (losses) 206 (48)
Other comprehensive income [Member] | Cross Currency Interest Rate Contract [Member]    
Derivative [Line Items]    
Unrealized gains (losses) on contracts, net $ 14,917 $ (7,256)
v3.24.1.u1
Basis of Presentation and Summary of Significant Accounting Policies - Summary of Activity of Company's Accrued Warranty Liability (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Movement in Standard Product Warranty Accrual [Roll Forward]    
Balance at Beginning of Period $ 12,050 $ 11,949
Accruals for Warranties 480 2,177
Settlements Made (1,677) (1,815)
Balance at End of Period $ 10,853 $ 12,311
v3.24.1.u1
Revenue Recognition - Additional Information (Detail) - USD ($)
$ in Millions
Mar. 31, 2024
Dec. 31, 2023
Other Long-Term Liabilities [Member]    
Revenue Recognition [Line Items]    
Deferred revenue and customer advances $ 70 $ 67
v3.24.1.u1
Revenue Recognition - Summary of Activity of the Company's Deferred Revenue and Customer Advances (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Revenue Recognition and Deferred Revenue [Abstract]    
Balance at the beginning of the period $ 323,516 $ 285,175
Recognition of revenue included in balance at beginning of the period (103,996) (105,222)
Revenue deferred during the period, net of revenue recognized 187,525 193,286
Balance at the end of the period $ 407,045 $ 373,239
v3.24.1.u1
Revenue Recognition - Schedule of Estimated Amount of Deferred Revenue and Customer Advances (Detail) - USD ($)
$ in Thousands
Mar. 30, 2024
Dec. 31, 2023
Revenue Recognition [Line Items]    
Deferred revenue and customer advances expected to be recognized $ 336,718 $ 256,675
Deferred revenue and customer advances expected to be recognized 407,045  
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-12-31    
Revenue Recognition [Line Items]    
Deferred revenue and customer advances expected to be recognized $ 336,718  
Deferred revenue and customer advances recognition period 1 year  
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-12-31    
Revenue Recognition [Line Items]    
Deferred revenue and customer advances expected to be recognized $ 42,162  
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-12-31 | Minimum [Member]    
Revenue Recognition [Line Items]    
Deferred revenue and customer advances recognition period 13 months  
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-12-31 | Maximum [Member]    
Revenue Recognition [Line Items]    
Deferred revenue and customer advances recognition period 24 months  
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-12-31    
Revenue Recognition [Line Items]    
Deferred revenue and customer advances expected to be recognized $ 28,165  
Deferred revenue and customer advances recognition period 25 months  
v3.24.1.u1
Marketable Securities - Additional Information (Detail) - USD ($)
$ in Millions
Mar. 30, 2024
Dec. 31, 2023
Investments, Debt and Equity Securities [Abstract]    
Time Deposits $ 0.9 $ 0.9
v3.24.1.u1
Inventories - Inventory, Net of Reserves (Detail) - USD ($)
$ in Thousands
Mar. 30, 2024
Dec. 31, 2023
Inventory, Net, Items Net of Reserve Alternative [Abstract]    
Raw materials $ 241,744 $ 233,952
Work in progress 23,825 20,198
Finished goods 273,065 262,086
Total inventories $ 538,634 $ 516,236
v3.24.1.u1
Goodwill and Other Intangibles - Additional Information (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Dec. 31, 2023
Goodwill $ 1,297,826   $ 1,305,446
Intangible assets, gross foreign currency translation adjustments 16,000    
Intangible assets, accumulated amortization foreign currency translation adjustments 14,000    
Amortization expense 26,000 $ 12,000  
Future amortization expense, year 1 108,000    
Future amortization expense, year 2 108,000    
Future amortization expense, year 3 108,000    
Future amortization expense, year 4 108,000    
Future amortization expense, year 5 108,000    
Intangible assets other than goodwill capitalized during the period $ 10,000 $ 14,000  
v3.24.1.u1
Goodwill and Other Intangibles - Schedule of Intangible Assets (Detail) - USD ($)
$ in Thousands
Mar. 30, 2024
Dec. 31, 2023
Finite Lived and Indefinite Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 1,405,196 $ 1,411,070
Accumulated Amortization $ 794,049 $ 781,883
Weighted-Average Amortization Period 7 years 7 years
Trademarks [Member]    
Finite Lived and Indefinite Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 9,680 $ 9,680
Software Development [Member]    
Finite Lived and Indefinite Lived Intangible Assets [Line Items]    
Gross Carrying Amount 655,433 660,273
Accumulated Amortization $ 495,177 $ 495,317
Weighted-Average Amortization Period 5 years 5 years
Purchased Intangibles [Member]    
Finite Lived and Indefinite Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 612,382 $ 614,357
Accumulated Amortization $ 207,620 $ 197,154
Weighted-Average Amortization Period 10 years 10 years
Licensing Agreements [Member]    
Finite Lived and Indefinite Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 14,673 $ 14,798
Accumulated Amortization $ 8,698 $ 8,429
Weighted-Average Amortization Period 7 years 7 years
Patents and Other Intangibles [Member]    
Finite Lived and Indefinite Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 113,028 $ 111,962
Accumulated Amortization $ 82,554 $ 80,983
Weighted-Average Amortization Period 8 years 8 years
v3.24.1.u1
Debt - Additional Information (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Mar. 31, 2024
Dec. 31, 2023
Sep. 17, 2021
Debt Instrument [Line Items]        
Debt facility fee The interest rates applicable under the Credit Facility are, at the Company’s option, equal to either the alternate base rate (which is a rate per annum equal to the greatest of (1) the prime rate in effect on such day, (2) the Federal Reserve Bank of New York Rate on such day plus 1⁄2 of 1% per annum and (3) the adjusted Term SOFR rate for a one-month interest period as published two U.S. Government Securities Business Days prior to such day (or if such day is not a U.S. Government Securities Business Day, the immediately preceding U.S. Government Securities Business Day), plus 1% annum) or the applicable 1, 3 or 6 month adjusted Term SOFR or EURIBO rate for euro-denominated loans, in each case, plus an interest rate margin based upon the Company’s leverage ratio, which can range between 0 and 12.5 basis points for alternate base rate loans and between 80 and 112.5 basis points for Term SOFR or EURIBO rate loans. The facility fee on the Credit Facility ranges between 7.5 and 25 basis points per annum, based on the leverage ratio, of the amount of the revolving facility commitments and the outstanding term loan.      
Long-term debt $ 2,005,761 $ 2,005,761 $ 2,305,513  
Line of credit maximum borrowing capacity   112,000 114,000  
Notes Payable to Banks [Member]        
Debt Instrument [Line Items]        
Interest rate terms on debt The interest rates applicable under the Credit Facility are, at the Company’s option, equal to either the alternate base rate (which is a rate per annum equal to the greatest of (1) the prime rate in effect on such day, (2) the Federal Reserve Bank of New York Rate on such day plus 1⁄2 of 1% per annum and (3) the adjusted Term SOFR rate for a one-month interest period as published two U.S. Government Securities Business Days prior to such day (or if such day is not a U.S. Government Securities Business Day, the immediately preceding U.S. Government Securities Business Day), plus 1% annum) or the applicable 1, 3 or 6 month adjusted Term SOFR or EURIBO rate for euro-denominated loans, in each case, plus an interest rate margin based upon the Company’s leverage ratio, which can range between 0 and 12.5 basis points for alternate base rate loans and between 80 and 112.5 basis points for Term SOFR or EURIBO rate loans. The facility fee on the Credit Facility ranges between 7.5 and 25 basis points per annum, based on the leverage ratio, of the amount of the revolving facility commitments and the outstanding term loan.      
Unused borrowing capacity   1,200,000 900,000  
Unsecured Debt [Member]        
Debt Instrument [Line Items]        
Debt covenant description These senior unsecured notes require that the Company comply with an interest coverage ratio test of not less than 3.50:1 for any period of four consecutive fiscal quarters and a leverage ratio test of not more than 3.50:1 as of the end of any fiscal quarter. In addition, these senior unsecured notes include customary negative covenants, affirmative covenants, representations and warranties and events of default.      
Long-term debt   $ 1,300,000 $ 1,300,000  
Call feature on debt instrument The Company may prepay all or some of the senior unsecured notes at any time in an amount not less than 10% of the aggregate principal amount outstanding. In the event of a change in control of the Company (as defined in the note purchase agreement), the Company may be required to prepay the senior unsecured notes at a price equal      
Debt instrument percentage of the amount to be prepaid 10.00%      
Debt instrument interest coverage ratio 3.50%      
Debt instrument leverage ratio 3.50%      
Credit Agreements and Unsecured Debt [Member]        
Debt Instrument [Line Items]        
Weighted-average interest rate   4.42% 4.69%  
Revolving Facilities [Member] | Notes Payable to Banks [Member]        
Debt Instrument [Line Items]        
Face value of debt       $ 2,000,000
2021 Credit Facility [Member]        
Debt Instrument [Line Items]        
Long term debt gross   $ 800,000 $ 1,100,000  
Debt Instrument, Term 5 years      
v3.24.1.u1
Debt - Summary of Outstanding Debt (Detail) - USD ($)
$ in Thousands
Mar. 31, 2024
Mar. 30, 2024
Dec. 31, 2023
Debt Instrument [Line Items]      
Total notes payable and debt, current $ 50,000   $ 50,000
Unamortized debt issuance costs (4,239)   (4,487)
Total long-term debt 2,005,761 $ 2,005,761 2,305,513
Total debt 2,055,761   2,355,513
Credit Agreement [Member]      
Debt Instrument [Line Items]      
Long-term debt 750,000   1,050,000
Senior Unsecured Notes Series G [Member]      
Debt Instrument [Line Items]      
Total notes payable and debt, current   50,000 50,000
Senior Unsecured Notes Series K [Member]      
Debt Instrument [Line Items]      
Total notes payable and debt, current 160,000   160,000
Senior Unsecured Notes Series L [Member]      
Debt Instrument [Line Items]      
Total notes payable and debt, current   200,000 200,000
Senior Unsecured Notes Series M [Member]      
Debt Instrument [Line Items]      
Total notes payable and debt, current   $ 300,000 300,000
Senior Unsecured Notes Series N [Member]      
Debt Instrument [Line Items]      
Long-term debt 100,000   100,000
Senior Unsecured Notes Series O [Member]      
Debt Instrument [Line Items]      
Long-term debt 400,000   400,000
Senior Unsecured Notes Series P [Member]      
Debt Instrument [Line Items]      
Long-term debt 50,000   50,000
Senior Unsecured Notes Series Q [Member]      
Debt Instrument [Line Items]      
Long-term debt $ 50,000   $ 50,000
v3.24.1.u1
Debt - Summary of Outstanding Debt (Parenthetical) (Detail)
Mar. 30, 2024
Dec. 31, 2023
Senior Unsecured Notes Series G [Member]    
Debt Instrument [Line Items]    
Stated interest rate on debt instrument 3.92% 3.92%
Senior Unsecured Notes Series K [Member]    
Debt Instrument [Line Items]    
Stated interest rate on debt instrument 3.44% 3.44%
Senior Unsecured Notes Series L [Member]    
Debt Instrument [Line Items]    
Stated interest rate on debt instrument 3.31% 3.31%
Senior Unsecured Notes Series M [Member]    
Debt Instrument [Line Items]    
Stated interest rate on debt instrument 3.53% 3.53%
Senior Unsecured Notes Series N [Member]    
Debt Instrument [Line Items]    
Stated interest rate on debt instrument 1.68% 1.68%
Senior Unsecured Notes Series O [Member]    
Debt Instrument [Line Items]    
Stated interest rate on debt instrument 2.25% 2.25%
Senior Unsecured Notes Series P [Member]    
Debt Instrument [Line Items]    
Stated interest rate on debt instrument 4.91% 4.91%
Senior Unsecured Notes Series Q [Member]    
Debt Instrument [Line Items]    
Stated interest rate on debt instrument 4.91% 4.91%
v3.24.1.u1
Income Taxes - Additional Information (Detail) - USD ($)
$ / shares in Units, $ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Income Taxes [Line Items]    
Income tax holiday amount $ 2,000 $ 3,000
Income tax holiday per share benefit $ 0.03 $ 0.05
Effective income tax rate 11.00% 14.70%
Incremental income tax provision $ 12,660 $ 24,250
Gross unrecognized tax benefit would impact the Company's effective tax rate 15,000 30,000
Stock Based Compensation Tax Benefit [Member]    
Income Taxes [Line Items]    
Incremental income tax provision $ 1,000 $ 2,000
United States [Member]    
Income Taxes [Line Items]    
Statutory tax rate 21.00%  
Ireland [Member]    
Income Taxes [Line Items]    
Statutory tax rate 12.50%  
U.K [Member]    
Income Taxes [Line Items]    
Statutory tax rate 25.00%  
Singapore [Member]    
Income Taxes [Line Items]    
Statutory tax rate 17.00%  
Singapore [Member] | April Two Thousand And Twenty One To March Two Thousand And Twenty Six [Member] | New Contractual Arrangement [Member]    
Income Taxes [Line Items]    
Statutory tax rate 5.00%  
v3.24.1.u1
Litigation - Additional Information (Detail)
$ in Millions
 3 Months Ended
Mar. 30, 2024
USD ($)
Obligation with Joint and Several Liability Arrangement [Line Items]  
Litigation provision during the year $ 10
v3.24.1.u1
Other Commitments and Contingencies Additional Information (Detail)
 3 Months Ended
Mar. 30, 2024
Commitments and Contingencies Disclosure [Abstract]  
Future Minimum License Fees Payable Future minimum license fees payable under existing license agreements as of March 30, 2024 are immaterial for the years ended December 31, 2024 and thereafter.
v3.24.1.u1
Earnings Per Share - Earnings Per Share Reconciliation (Detail) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Earnings Per Share [Abstract]    
Net income per basic common share, Net Income (Numerator) $ 102,196 $ 140,923
Net income per diluted common share, Net Income (Numerator) $ 102,196 $ 140,923
Net income per basic common share, Weighted-Average Shares (Denominator) 59,232 59,023
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities, Weighted-Average Shares (Denominator) 199 294
Net income per diluted common share, Weighted-Average Shares (Denominator) 59,431 59,317
Net income per basic common share, Per Share Amount $ 1.73 $ 2.39
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities, Per Share Amount (0.01) (0.01)
Net income per diluted common share, Per Share Amount $ 1.72 $ 2.38
v3.24.1.u1
Earnings Per Share - Additional Information (Detail) - shares
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Earnings Per Share [Abstract]    
Antidilutive securities excluded from computation of earnings per share 326,000 140,000
v3.24.1.u1
Accumulated Other Comprehensive Income (Loss) - Schedule of Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Accumulated Other Comprehensive Income (Loss) [Line Items]    
Beginning balance $ 1,150,341 $ 504,488
Other comprehensive income (loss), net of tax (7,763) 8,776
Ending balance 1,256,525 599,823
Currency Translation [Member]    
Accumulated Other Comprehensive Income (Loss) [Line Items]    
Beginning balance (128,359)  
Other comprehensive income (loss), net of tax (9,540)  
Ending balance (137,899)  
Unrealized Gain (Loss) on Retirement Plans [Member]    
Accumulated Other Comprehensive Income (Loss) [Line Items]    
Beginning balance (3,501)  
Other comprehensive income (loss), net of tax 175  
Ending balance (3,326)  
Unrealized Loss on Derivative Instruments [Member]    
Accumulated Other Comprehensive Income (Loss) [Line Items]    
Beginning balance (2,260)  
Other comprehensive income (loss), net of tax 1,602  
Ending balance (658)  
Accumulated Other Comprehensive Loss [Member]    
Accumulated Other Comprehensive Income (Loss) [Line Items]    
Beginning balance (134,120) (141,572)
Other comprehensive income (loss), net of tax (7,763)  
Ending balance $ (141,883) $ (132,796)
v3.24.1.u1
Business Segment Information - Additional Information (Detail)
 3 Months Ended
Mar. 30, 2024
Segment
Segment Reporting [Abstract]  
Number of operating segments 2
Number of reportable segments 1
v3.24.1.u1
Business Segment Information - Summary of Net Sales for Company's Products and Services (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Disaggregation of Revenue [Line Items]    
Total net sales $ 636,839 $ 684,674
Waters Instrument Systems [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 191,259 244,211
Chemistry Consumables [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 134,207 133,515
TA Instrument Systems [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 50,685 58,731
Product [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 376,151 436,457
Waters Service [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 236,433 224,349
TA Service [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 24,255 23,868
Service [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales $ 260,688 $ 248,217
v3.24.1.u1
Business Segment Information - Summary of Geographic Sales Information (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Disaggregation of Revenue [Line Items]    
Total net sales $ 636,839 $ 684,674
China [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 85,745 116,065
Japan [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 35,547 46,494
Asia Other [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 86,267 90,522
Total Asia [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 207,559 253,081
United States [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 202,839 202,305
Americas Other [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 38,332 44,116
Total Americas [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 241,171 246,421
Europe [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales $ 188,109 $ 185,172
v3.24.1.u1
Business Segment Information - Summary of Net Sales by Customer Class (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Revenue, Major Customer [Line Items]    
Total net sales $ 636,839 $ 684,674
Pharmaceutical [Member]    
Revenue, Major Customer [Line Items]    
Total net sales 374,207 384,898
Industrial [Member]    
Revenue, Major Customer [Line Items]    
Total net sales 195,334 209,650
Academic and government [Member]    
Revenue, Major Customer [Line Items]    
Total net sales $ 67,298 $ 90,126
v3.24.1.u1
Business Segment Information - Summary of Net Sales of Company Recognized at a Point in Time Versus Over Time (Detail) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 30, 2024
Apr. 01, 2023
Disaggregation of Revenue [Line Items]    
Total net sales $ 636,839 $ 684,674
Chemistry Consumables [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 134,207 133,515
Service [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 260,688 248,217
Net Sales Recognized at a Point in Time: [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 459,476 524,664
Net Sales Recognized at a Point in Time: [Member] | Instrument Systems [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 241,944 302,942
Net Sales Recognized at a Point in Time: [Member] | Chemistry Consumables [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 134,207 133,515
Net Sales Recognized at a Point in Time: [Member] | Service [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 83,325 88,207
Net Sales Recognized Over Time: [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales 636,839 684,674
Net Sales Recognized Over Time: [Member] | Service [Member]    
Disaggregation of Revenue [Line Items]    
Total net sales $ 177,363 $ 160,010
v3.24.1.u1
Recent Accounting Standard Changes and Developments - Additional Information (Detail)
 3 Months Ended
Mar. 30, 2024
New Accounting Pronouncements or Change in Accounting Principle [Line Items]  
New Accounting Pronouncement or Change in Accounting Principle, Description no
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