Knowles CorpKN
Knowles Corp Segments Disclosure
17. Segment Information
The Company determines its operating segments consistent with the manner in which it manages its operations and evaluates performance for internal review and decision making. These segments were determined in accordance with ASC 280, Segment Reporting. The Company’s segments engage in business activities from which they earn revenues and incur expenses, have discrete financial information available, and whose financial results are regularly reviewed and used by the chief operating decision maker ("CODM") to evaluate segment performance, allocate resources, and determine management incentive compensation.
The Company's CODM is the President and Chief Executive Officer, who reviews the results and performance for each operating segment to manage operations and make decisions regarding resource allocations. The financial measures used by the CODM to assess segment performance include Revenues, Adjusted cost of goods sold, Adjusted research and development expenses, Adjusted selling and administrative expenses, and Segment adjusted earnings before interest and income taxes. The CODM uses these financial metrics to view operating trends, benchmark performance between periods, and to monitor budget-to-actual variances.
The Precision Devices segment aggregates three operating segments into one reportable segment based on similar economic characteristics stemming from similar products, production processes, type or class of customers, and distribution methods. The MedTech & Specialty Audio reportable segment has one operating segment. The Company's two reportable segments are as follows:
• Precision Devices ("PD")
Our PD segment specializes in the custom design and delivery of high performance capacitor products and RF solutions primarily serving the defense, industrial, medtech, and electrification/energy markets. PD has sales, support, and engineering facilities in North America, Europe, and Asia as well as manufacturing facilities in North America and Asia.
• MedTech & Specialty Audio ("MSA")
Our MSA segment designs and manufactures balanced armature speakers and microphones used in hearing health and specialty audio applications that serve the medtech and industrial markets. MSA has sales, support, and engineering facilities in North America, Europe, and Asia, as well as manufacturing facilities in Asia.
Information regarding the results of the Company's reportable segments is as follows:
For the Year Ended December 31, 2025 | |||||||||||||||||
| (in millions) | Precision Devices | MedTech & Specialty Audio | Total | ||||||||||||||
| Revenues | $ | 328.9 | $ | 264.3 | $ | 593.2 | |||||||||||
| Adjusted cost of goods sold | 200.0 | 129.2 | 329.2 | ||||||||||||||
| Adjusted research and development expenses | 16.3 | 18.6 | 34.9 | ||||||||||||||
| Adjusted selling and administrative expenses | 48.9 | 14.3 | 63.2 | ||||||||||||||
Other segment items (1) | 0.4 | (0.2) | 0.2 | ||||||||||||||
| Segment adjusted earnings before interest and income taxes | $ | 63.3 | $ | 102.4 | $ | 165.7 | |||||||||||
| Less: | |||||||||||||||||
| Corporate expenses | 45.6 | ||||||||||||||||
| Stock-based compensation expense | 28.4 | ||||||||||||||||
| Intangibles amortization expense | 16.2 | ||||||||||||||||
| Interest expense, net | 9.3 | ||||||||||||||||
| Impairment charges | 3.6 | ||||||||||||||||
| Restructuring charges | 3.8 | ||||||||||||||||
| Production transfer costs | 1.7 | ||||||||||||||||
| Acquisition-related costs | 0.8 | ||||||||||||||||
Other (2) | 0.5 | ||||||||||||||||
| Plus: | |||||||||||||||||
| Dividend income | 6.2 | ||||||||||||||||
| Transition services credit | 2.0 | ||||||||||||||||
| Earnings before income taxes and discontinued operations | $ | 64.0 | |||||||||||||||
(1) Other segment items primarily include foreign currency exchange gains and losses and other non-operating income and expense.
(2) Other expenses include non-recurring professional service fees related to the execution of various reorganization projects and foreign currency exchange rate impacts on restructuring balances.
For the Year Ended December 31, 2024 | |||||||||||||||||
| (in millions) | Precision Devices | MedTech & Specialty Audio | Total | ||||||||||||||
| Revenues | $ | 300.0 | $ | 253.5 | $ | 553.5 | |||||||||||
| Adjusted cost of goods sold | 186.6 | 119.9 | 306.5 | ||||||||||||||
| Adjusted research and development expenses | 16.0 | 18.0 | 34.0 | ||||||||||||||
| Adjusted selling and administrative expenses | 47.2 | 13.3 | 60.5 | ||||||||||||||
Other segment items (1) | 0.2 | — | 0.2 | ||||||||||||||
| Segment adjusted earnings before interest and income taxes | $ | 50.0 | $ | 102.3 | $ | 152.3 | |||||||||||
| Less: | |||||||||||||||||
| Corporate expenses | 44.4 | ||||||||||||||||
| Stock-based compensation expense | 22.2 | ||||||||||||||||
| Intangibles amortization expense | 17.0 | ||||||||||||||||
| Interest expense, net | 16.3 | ||||||||||||||||
| Restructuring charges | 3.4 | ||||||||||||||||
| Production transfer costs | 4.2 | ||||||||||||||||
| Acquisition-related costs | 8.4 | ||||||||||||||||
Other (2) | 1.7 | ||||||||||||||||
| Earnings before income taxes and discontinued operations | $ | 34.7 | |||||||||||||||
(1) Other segment items primarily include foreign currency exchange gains and losses and other non-operating income and expense.
(2) Other expenses include non-recurring professional service fees related to the execution of various reorganization projects and foreign currency exchange rate impacts on restructuring balances.
For the Year Ended December 31, 2023 | |||||||||||||||||
| (in millions) | Precision Devices | MedTech & Specialty Audio | Total | ||||||||||||||
| Revenues | $ | 221.4 | $ | 235.4 | $ | 456.8 | |||||||||||
| Adjusted cost of goods sold | 132.2 | 115.3 | 247.5 | ||||||||||||||
| Adjusted research and development expenses | 12.3 | 17.0 | 29.3 | ||||||||||||||
| Adjusted selling and administrative expenses | 36.1 | 13.3 | 49.4 | ||||||||||||||
Other segment items (1) | 0.3 | — | 0.3 | ||||||||||||||
| Segment adjusted earnings before interest and income taxes | $ | 40.5 | $ | 89.8 | $ | 130.3 | |||||||||||
| Less: | |||||||||||||||||
| Corporate expenses | 42.1 | ||||||||||||||||
| Stock-based compensation expense | 22.8 | ||||||||||||||||
| Intangibles amortization expense | 7.5 | ||||||||||||||||
| Interest expense, net | 5.4 | ||||||||||||||||
| Restructuring charges | 3.3 | ||||||||||||||||
| Production transfer costs | 0.4 | ||||||||||||||||
| Acquisition-related costs | 9.4 | ||||||||||||||||
Other (2) | 2.1 | ||||||||||||||||
| Earnings before income taxes and discontinued operations | $ | 37.3 | |||||||||||||||
(1) Other segment items primarily include foreign currency exchange gains and losses and other non-operating income and expense.
(2) Other expenses include non-recurring professional service fees related to the execution of various reorganization projects and foreign currency exchange rate impacts on restructuring balances.
Other information regarding the Company's reportable segments is as follows:
| Years Ended December 31, | |||||||||||||||||
| (in millions) | 2025 | 2024 | 2023 | ||||||||||||||
| Depreciation and amortization: | |||||||||||||||||
| Precision Devices | $ | 26.1 | $ | 27.5 | $ | 15.8 | |||||||||||
| MedTech & Specialty Audio | 8.5 | 8.3 | 8.2 | ||||||||||||||
| Corporate | 1.7 | 1.8 | 2.2 | ||||||||||||||
| Total | $ | 36.3 | $ | 37.6 | $ | 26.2 | |||||||||||
| Capital expenditures: | |||||||||||||||||
| Precision Devices | $ | 24.9 | $ | 6.2 | $ | 7.6 | |||||||||||
| MedTech & Specialty Audio | 6.2 | 5.3 | 4.6 | ||||||||||||||
| Corporate | 1.0 | 0.4 | — | ||||||||||||||
| Total | $ | 32.1 | $ | 11.9 | $ | 12.2 | |||||||||||
Information regarding assets of the Company's reportable segments is as follows:
| Total Assets | |||||||||||||||||
| (in millions) | December 31, 2025 | December 31, 2024 | December 31, 2023 | ||||||||||||||
| Precision Devices | $ | 554.7 | $ | 619.9 | $ | 628.3 | |||||||||||
| MedTech & Specialty Audio | 399.7 | 410.6 | 391.7 | ||||||||||||||
Corporate (1) | 96.7 | 87.7 | 7.8 | ||||||||||||||
| Discontinued operations | — | — | 435.0 | ||||||||||||||
| Total | $ | 1,051.1 | $ | 1,118.2 | $ | 1,462.8 | |||||||||||
(1) Corporate assets include Syntiant Corp. preferred stock of $83.4 million and $77.2 million at December 31, 2025 and 2024, respectively, and a note receivable from Syntiant totaling $5.9 million and $6.4 million at December 31, 2025 and 2024, respectively. Corporate assets also include the portion of right-of-use operating lease assets subleased by Syntiant, which totaled $5.2 million and $0.3 million at December 31, 2025 and 2024, respectively.
The following table details revenues by geographic location. Revenues are attributed to regions based on the location of the Company's direct customer, which in some instances is an intermediary and not necessarily the end user. Long-lived assets are comprised of net property, plant, and equipment and operating lease right-of-use assets. These assets have been classified based on the geographic location of where they reside. The Company's businesses are based primarily in North America, Asia, and Europe.
| Revenues | Long-Lived Assets | ||||||||||||||||||||||||||||
| Years Ended December 31, | December 31, | ||||||||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2023 | 2025 | 2024 | ||||||||||||||||||||||||
| United States | $ | 248.8 | $ | 236.0 | $ | 160.8 | $ | 93.9 | $ | 81.3 | |||||||||||||||||||
| Asia | 226.1 | 187.1 | 176.6 | 62.2 | 52.9 | ||||||||||||||||||||||||
| Europe | 95.4 | 103.2 | 101.3 | 1.0 | 2.8 | ||||||||||||||||||||||||
| Other Americas | 12.0 | 12.1 | 6.8 | 2.2 | 1.7 | ||||||||||||||||||||||||
| Other | 10.9 | 15.1 | 11.3 | — | — | ||||||||||||||||||||||||
| Total | $ | 593.2 | $ | 553.5 | $ | 456.8 | $ | 159.3 | $ | 138.7 | |||||||||||||||||||
The Company's customers that accounted for 10% or more of total revenues in 2025 were WS Audiology A/S and TTI, Inc. WS Audiology is a hearing aid manufacturer and TTI is a distributor of electromechanical components. They each represented the following percentages of total Company revenues:
| Years Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| WS Audiology A/S | 11 | % | 14 | % | 16 | % | |||||||||||
| TTI Inc. | 10 | % | * | * | |||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 9, 2026 | Showing above |
| 2024 | Feb 13, 2025 | |
| 2023 | Feb 21, 2024 | |
| 2022 | Feb 9, 2023 | |
| 2021 | Feb 9, 2022 | |
| 2020 | Feb 10, 2021 | |
| 2019 | Feb 12, 2020 | |
| 2018 | Feb 19, 2019 | |
| 2017 | Feb 20, 2018 | |
| 2016 | Feb 21, 2017 | |
| 2015 | Feb 19, 2016 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.