10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022.

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-36102

Knowles Corporation

(Exact name of registrant as specified in its charter)

Delaware	90-1002689
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1151 Maplewood Drive, Itasca, IL

(Address of Principal Executive Offices)

60143

(Zip Code)

(630) 250-5100

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol	Name of each exchange on which registered
Common stock, $0.01 par value per share	KN	New York Stock Exchange

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 Exchange Act).

Yes ☐  No  ☑

The number of shares outstanding of the registrant’s common stock as of October 25, 2022 was 90,946,447.

Knowles Corporation

Form 10-Q

Table of Contents

		Page
PART I — FINANCIAL INFORMATION		1
Item 1.	Financial Statements	1
	Consolidated Statements of Earnings (unaudited) for the three and nine months ended September 30, 2022 and 2021	1
	Consolidated Statements of Comprehensive Earnings (unaudited) for the three and nine months ended September 30, 2022 and 2021	2
	Consolidated Balance Sheets (unaudited) at September 30, 2022 and December 31, 2021	3
	Consolidated Statements of Stockholders' Equity (unaudited) for the three and nine months ended September 30, 2022 and 2021	4
	Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, 2022 and 2021	6
	Notes to Consolidated Financial Statements (unaudited)	7
Forward-Looking Statements		23
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	40
Item 4.	Controls and Procedures	40
PART II — OTHER INFORMATION		40
Item 1.	Legal Proceedings	40
Item 1A.	Risk Factors	40
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41
Item 6.	Exhibits	41
SIGNATURES		42

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

KNOWLES CORPORATION

CONSOLIDATED STATEMENTS OF EARNINGS

(in millions, except per share amounts)

(unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Revenues	$	178.2	$	233.0	$	567.6	$	633.8
Cost of goods sold	110.1		136.1		338.5		375.2
Restructuring charges - cost of goods sold	28.1		—		28.1		—
Gross profit	40.0		96.9		201.0		258.6
Research and development expenses	19.3		22.3		63.7		70.2
Selling and administrative expenses	32.6		36.0		95.6		108.9
Impairment charges	—		4.0		239.8		4.0
Restructuring charges	2.7		—		9.8		0.3
Operating expenses	54.6		62.3		408.9		183.4
Operating (loss) earnings	(14.6)		34.6		(207.9)		75.2
Interest expense, net	1.1		4.2		2.7		12.3
Other income, net	(2.1)		(1.9)		(0.9)		(3.4)
(Loss) earnings before income taxes and discontinued operations	(13.6)		32.3		(209.7)		66.3
(Benefit from) provision for income taxes	(16.3)		4.6		12.4		8.7
Earnings (loss) from continuing operations	2.7		27.7		(222.1)		57.6
Earnings from discontinued operations, net	—		—		—		0.2
Net earnings (loss)	$	2.7	$	27.7	$	(222.1)	$	57.8
Earnings (loss) per share from continuing operations:
Basic	$	0.03	$	0.30	$	(2.42)	$	0.62
Diluted	$	0.03	$	0.29	$	(2.42)	$	0.61
Earnings per share from discontinued operations:
Basic	$	—	$	—	$	—	$	0.01
Diluted	$	—	$	—	$	—	$	—
Net earnings (loss) per share:
Basic	$	0.03	$	0.30	$	(2.42)	$	0.63
Diluted	$	0.03	$	0.29	$	(2.42)	$	0.61
Weighted-average common shares outstanding:
Basic	91.4		92.2		91.9		92.3
Diluted	92.0		94.1		91.9		94.8

See accompanying Notes to Consolidated Financial Statements

1

KNOWLES CORPORATION 

CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS

(in millions)

(unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Net earnings (loss)	$	2.7	$	27.7	$	(222.1)	$	57.8
Other comprehensive loss, net of tax
Foreign currency translation	(13.1)		(3.7)		(30.9)		(6.4)
Employee benefit plans:
Amortization or settlement of actuarial losses and prior service costs	(0.2)		0.1		(0.2)		0.7
Net change in employee benefit plans	(0.2)		0.1		(0.2)		0.7
Changes in fair value of cash flow hedges:
Unrealized net losses arising during period	(3.0)		(0.2)		(6.1)		(0.5)
Net losses (gains) reclassified into earnings	1.7		0.1		2.3		(1.4)
Total cash flow hedges	(1.3)		(0.1)		(3.8)		(1.9)
Other comprehensive loss, net of tax	(14.6)		(3.7)		(34.9)		(7.6)
Comprehensive (loss) earnings	$	(11.9)	$	24.0	$	(257.0)	$	50.2

See accompanying Notes to Consolidated Financial Statements

2

KNOWLES CORPORATION

CONSOLIDATED BALANCE SHEETS

(in millions, except share and per share amounts)

(unaudited)

	September 30, 2022		December 31, 2021
Current assets:
Cash and cash equivalents	$	41.5	$	68.9
Receivables, net of allowances of $0.7 and $0.2	128.7		146.6
Inventories, net	194.6		153.1
Prepaid and other current assets	12.4		11.7
Total current assets	377.2		380.3
Property, plant, and equipment, net	164.4		200.8
Goodwill	702.1		941.3
Intangible assets, net	88.1		97.3
Operating lease right-of-use assets	13.6		17.4
Other assets and deferred charges	91.3		94.5
Total assets	$	1,436.7	$	1,731.6
Current liabilities:
Accounts payable	$	58.3	$	90.9
Accrued compensation and employee benefits	24.8		42.8
Operating lease liabilities	9.5		11.4
Other accrued expenses	27.5		19.4
Federal and other taxes on income	11.2		1.7
Total current liabilities	131.3		166.2
Long-term debt	78.0		70.0
Deferred income taxes	0.5		0.6
Long-term operating lease liabilities	8.4		14.7
Other liabilities	38.3		20.6
Commitments and contingencies (Note 14)
Stockholders' equity:
Preferred stock - $0.01 par value; 10,000,000 shares authorized; none issued	—		—
Common stock - $0.01 par value; 400,000,000 shares authorized; 96,299,675 and 90,946,447 shares issued and outstanding at September 30, 2022, respectively, and 95,112,778 and 91,894,980 shares issued and outstanding at December 31, 2021, respectively	1.0		1.0
Treasury stock - at cost; 5,353,228 and 3,217,798 shares at September 30, 2022 and December 31, 2021, respectively	(103.3)		(62.4)
Additional paid-in capital	1,658.0		1,639.4
Accumulated deficit	(240.2)		(18.1)
Accumulated other comprehensive loss	(135.3)		(100.4)
Total stockholders' equity	1,180.2		1,459.5
Total liabilities and stockholders' equity	$	1,436.7	$	1,731.6

See accompanying Notes to Consolidated Financial Statements

3

KNOWLES CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in millions, except share amounts)

(unaudited)

	Common Stock			Treasury Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
	Shares Issued	Amount		Shares	Amount
Balance at June 30, 2022	96,254,641	$	1.0	(4,263,678)	$	(84.7)	$	1,650.9	$	(242.9)	$	(120.7)	$	1,203.6
Net earnings	—	—		—	—		—		2.7		—		2.7
Other comprehensive loss, net of tax	—	—		—	—		—		—		(14.6)		(14.6)
Repurchase of common stock	—	—		(1,089,550)	(18.6)		—		—		—		(18.6)
Stock-based compensation expense	—	—		—	—		6.8		—		—		6.8
Exercise of stock options	29,672	—		—	—		0.4		—		—		0.4
Restricted stock unit settlement, net of tax	15,362	—		—	—		(0.1)		—		—		(0.1)
Balance at September 30, 2022	96,299,675	$	1.0	(5,353,228)	$	(103.3)	$	1,658.0	$	(240.2)	$	(135.3)	$	1,180.2
	Common Stock			Treasury Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
	Shares Issued	Amount		Shares	Amount
Balance at June 30, 2021	94,075,885	$	0.9	(2,089,487)	$	(36.2)	$	1,610.2	$	(138.4)	$	(104.4)	$	1,332.1
Net earnings	—	—		—	—		—		27.7		—		27.7
Other comprehensive loss, net of tax	—	—		—	—		—		—		(3.7)		(3.7)
Stock-based compensation expense	—	—		—	—		7.1		—		—		7.1
Exercise of stock options	218,342	—		—	—		3.9		—		—		3.9
Restricted and performance stock unit settlement, net of tax	120,959	—		—	—		(1.0)		—		—		(1.0)
Balance at September 30, 2021	94,415,186	$	0.9	(2,089,487)	$	(36.2)	$	1,620.2	$	(110.7)	$	(108.1)	$	1,366.1

See accompanying Notes to Consolidated Financial Statements

4

KNOWLES CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in millions, except share amounts)

(unaudited)

	Common Stock			Treasury Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
	Shares Issued	Amount		Shares	Amount
Balance at December 31, 2021	95,112,778	$	1.0	(3,217,798)	$	(62.4)	$	1,639.4	$	(18.1)	$	(100.4)	$	1,459.5
Net loss	—	—		—	—		—		(222.1)		—		(222.1)
Other comprehensive loss, net of tax	—	—		—	—		—		—		(34.9)		(34.9)
Repurchase of common stock	—	—		(2,339,045)	(44.0)		—		—		—		(44.0)
Stock-based compensation expense	—	—		—	—		21.6		—		—		21.6
Exercise of stock options	529,199	—		—	—		6.4		—		—		6.4
Exercise of warrants	—	—		203,615	3.1		(3.1)		—		—		—
Restricted and performance stock unit settlement, net of tax	657,698	—		—	—		(6.3)		—		—		(6.3)
Balance at September 30, 2022	96,299,675	$	1.0	(5,353,228)	$	(103.3)	$	1,658.0	$	(240.2)	$	(135.3)	$	1,180.2
	Common Stock			Treasury Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
	Shares Issued	Amount		Shares	Amount
Balance at December 31, 2020	92,689,912	$	0.9	(1,078,363)	$	(16.2)	$	1,587.8	$	(168.5)	$	(100.5)	$	1,303.5
Net earnings	—	—		—	—		—		57.8		—		57.8
Other comprehensive loss, net of tax	—	—		—	—		—		—		(7.6)		(7.6)
Repurchase of common stock	—	—		(1,011,124)	(20.0)		—		—		—		(20.0)
Stock-based compensation expense	—	—		—	—		25.6		—		—		25.6
Exercise of stock options	867,386	—		—	—		14.4		—		—		14.4
Restricted and performance stock unit settlement, net of tax	857,888	—		—	—		(7.6)		—		—		(7.6)
Balance at September 30, 2021	94,415,186	$	0.9	(2,089,487)	$	(36.2)	$	1,620.2	$	(110.7)	$	(108.1)	$	1,366.1

See accompanying Notes to Consolidated Financial Statements

5

KNOWLES CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(unaudited)

	Nine Months Ended September 30,
	2022		2021
Operating Activities
Net (loss) earnings	$	(222.1)	$	57.8
Adjustments to reconcile net (loss) earnings to cash from operating activities:
Depreciation and amortization	41.7		46.6
Stock-based compensation	21.6		25.6
Impairment charges	239.8		4.0
Non-cash restructuring charges	8.9		—
Non-cash interest expense and amortization of debt issuance costs	0.5		7.1
Loss (gain) on disposal of fixed assets	0.2		(0.2)
Deferred income taxes	(2.0)		(1.5)
Other, net	(7.4)		(2.5)
Changes in assets and liabilities (excluding effects of foreign exchange):
Receivables, net	16.8		4.6
Inventories, net	(50.3)		(24.0)
Prepaid and other current assets	(1.5)		(1.4)
Accounts payable	(24.6)		1.4
Accrued compensation and employee benefits	(16.7)		5.9
Other accrued expenses	5.8		2.4
Accrued taxes	9.0		(3.0)
Other non-current assets and non-current liabilities	19.8		(6.2)
Net cash provided by operating activities	39.5		116.6
Investing Activities
Acquisitions of business (net of cash acquired)	(0.7)		(78.5)
Capital expenditures	(24.7)		(28.2)
Purchase of investments	—		(3.5)
Proceeds from the sale of investments	—		0.4
Proceeds from the sale of property, plant, and equipment	—		0.4
Net cash used in investing activities	(25.4)		(109.4)
Financing Activities
Payments under revolving credit facility	(15.0)		—
Borrowings under revolving credit facility	23.0		—
Repurchase of common stock	(44.0)		(20.0)
Tax on restricted and performance stock unit vesting	(6.3)		(7.6)
Payments of finance lease obligations	(4.2)		(1.7)
Proceeds from exercise of stock options	6.4		14.4
Net cash used in financing activities	(40.1)		(14.9)
Effect of exchange rate changes on cash and cash equivalents	(1.4)		(0.1)
Net decrease in cash and cash equivalents	(27.4)		(7.8)
Cash and cash equivalents at beginning of period	68.9		147.8
Cash and cash equivalents at end of period	$	41.5	$	140.0
Supplemental information - cash paid for:
Income taxes	$	3.9	$	12.3
Interest	$	2.4	$	4.0

See accompanying Notes to Consolidated Financial Statements

6

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

1. Basis of Presentation

Description of Business - Knowles Corporation (NYSE:KN) is a market leader and global provider of advanced micro-acoustic microphones and balanced armature speakers, audio solutions, and high performance capacitors and radio frequency ("RF") products, serving the consumer electronics, medtech, defense, electric vehicle, industrial, and communications markets. The Company uses its leading position in SiSonicTM micro-electro-mechanical systems ("MEMS") microphones and strong capabilities in audio processing technologies to optimize audio systems and improve the user experience across consumer applications. Knowles is also a leader in hearing health acoustics, high performance capacitors, and RF solutions for a diverse set of markets. The Company's focus on the customer, combined with its unique technology, proprietary manufacturing techniques, and global operational expertise, enable the Company to deliver innovative solutions across multiple applications. References to "Knowles," "the Company," "we," "our," and "us" refer to Knowles Corporation and its consolidated subsidiaries.

Financial Statement Presentation - The accompanying unaudited interim Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“GAAP” or “U.S. GAAP”) for complete financial statements. These unaudited interim Consolidated Financial Statements should therefore be read in conjunction with the Consolidated Financial Statements and Notes thereto for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K.

The accompanying unaudited interim Consolidated Financial Statements have been prepared in accordance with U.S. GAAP, which requires management to make estimates and assumptions that affect amounts reported in the Consolidated Financial Statements and accompanying disclosures. Although these estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future, actual results may differ from those estimates. Management uses historical experience and all available information to make these estimates. The unaudited interim Consolidated Financial Statements reflect all adjustments of a normal, recurring nature that are, in the opinion of management, necessary for a fair statement of results for these interim periods.

Share Repurchase Program - On February 24, 2020, the Company announced that its Board of Directors had authorized a share repurchase program of up to $100 million of the Company's common stock. On April 28, 2022, the Company announced that its Board of Directors had increased the authorization by up to $150 million in additional aggregate value. The timing and amount of any shares repurchased will be determined by the Company based on its evaluation of market conditions and other factors, and will be made in accordance with applicable securities laws in either the open market or in privately negotiated transactions. The Company is not obligated to purchase any shares under the program, and the program may be suspended or discontinued at any time. The actual timing, number, and share price of shares repurchased will depend on a number of factors, including the market price of the Company’s common stock, general market and economic conditions, and applicable legal requirements. Any shares repurchased will be held as treasury stock. During the nine months ended September 30, 2022 and 2021, the Company repurchased 2,339,045 shares and 1,011,124 shares of common stock, respectively, for a total of $44.0 million and $20.0 million, respectively.

Non-cash Investing Activities - Purchases of property, plant, and equipment included in accounts payable at September 30, 2022 and 2021 were $1.6 million and $3.6 million, respectively. These non-cash amounts are not reflected as Capital expenditures within Investing Activities on the Consolidated Statements of Cash Flows for the respective periods.

7

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

2. Recent Accounting Standards

Recently Adopted Accounting Standards

In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-06 to simplify the accounting for certain financial instruments with characteristics of liabilities and equity. The standard eliminates certain accounting models that separated embedded conversion features from host contracts for convertible instruments, requiring bifurcation only if the convertible feature qualifies as a derivative under Accounting Standards Codification ("ASC") 815 or for convertible instruments issued at a substantial premium. In addition, the guidance requires the if-converted method of calculating diluted earnings per share for convertible instruments, which eliminates the use of the treasury stock method for instruments that may be settled in cash or shares. The standard can be adopted on a modified retrospective basis to transactions outstanding as of the adoption date or on a fully retrospective basis to all periods presented. The Company adopted the standard using the modified retrospective method on January 1, 2022. Adoption of the standard did not impact the Consolidated Financial Statements as all of the Company’s convertible instruments were settled prior to the adoption date. See Note 9. Borrowings for detail on the Company's convertible instruments that matured on November 1, 2021.

3. Acquisition

On May 3, 2021, the Company acquired all of the outstanding shares of common stock of Integrated Microwave Corporation ("IMC") for $81.4 million. During the first quarter of 2022, the Company recorded a purchase price adjustment of $0.7 million that was paid during the second quarter of 2022. The adjustment, which did not impact the Consolidated Statements of Earnings, resulted in an increase to goodwill of $0.7 million. The acquired business provides RF filters to the defense, industrial, and communications markets. The transaction was accounted for under the acquisition method of accounting and the results of operations are included in the Consolidated Financial Statements from the date of acquisition in the Precision Devices ("PD") segment. Included in the Consolidated Statements of Earnings are IMC’s revenues and loss before income taxes of $7.0 million and $0.2 million, respectively, from the date of acquisition through September 30, 2021.

The table below represents the final allocation of the purchase price to net assets acquired as of May 3, 2021:

(in millions)
Cash	$	2.2
Receivables	3.0
Inventories	2.6
Property, plant, and equipment	8.3
Customer relationships	27.7
Developed technology	5.2
Trademarks and other amortized intangible assets	1.6
Goodwill	32.0
Assumed current liabilities	(1.2)
Total purchase price	$	81.4

The fair value for customer relationships was determined using the multi-period excess earnings method under the income approach. This method reflects the present value of expected future cash flows less charges representing the contribution of other assets to those cash flows. The fair value for developed technology was determined using the relief from royalty method under the income approach. The fair value measurements of intangible assets are based on significant unobservable inputs, and thus represent Level 3 inputs. Significant assumptions used in assessing the fair values of customer relationships and developed technology include forecasted revenue growth rates, profit margins, customer attrition rates, royalty rates, and discount rates. Discount rates of 13.0% and 14.0% were applied to the expected future cash flows to reflect the risk related to customer relationships and developed technology, respectively. Customer relationships and developed technology will be amortized on a straight-line basis over estimated useful lives of 8 years and 10 years, respectively.

8

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

The excess of the total purchase price over the total fair value of the identifiable assets and liabilities was recorded as goodwill. The goodwill recognized is primarily attributable to synergies and the assembled workforce. All of the goodwill resulting from this acquisition is tax deductible. Goodwill has been allocated to the PD segment, which is the segment expected to benefit from the acquisition.

The Company believes the fair values assigned to intangible assets are based on reasonable assumptions and estimates that approximate the amounts a market participant would pay for these intangible assets as of the acquisition date. Actual results could differ materially from these estimates.

Pro-forma financial information has not been provided as the acquisition did not have a material impact on the Consolidated Statements of Earnings.

4. Impairment Charges

Goodwill Impairment

The Company tests goodwill for impairment at least annually as of October 1, or more frequently if there are events or circumstances indicating the carrying value of individual reporting units may exceed their respective fair values on a more likely than not basis. Recoverability of goodwill is measured at the reporting unit level. The Company’s three reporting units are Mobile Consumer Electronics (“MCE”), Hearing Health Technologies, and Precision Devices. The impairment assessment compares the fair value of each reporting unit to its carrying value. Impairment is measured as the amount by which the carrying value of a reporting unit exceeds its fair value.

During the second quarter of 2022, the Company identified a triggering event requiring an interim impairment assessment for the MCE reporting unit, which resulted in a goodwill impairment charge of $239.8 million. The triggering event occurred due to the identification of a rapid decline in current demand and a reduction in the expected future growth rate for global consumer electronics, which resulted in reductions to forecasted revenue and terminal growth rates and profit margins. The goodwill impairment charge is presented within Impairment charges in Operating expenses on the Consolidated Statements of Earnings. The Company had not incurred any previous goodwill impairment charges.

Fair value was estimated using a discounted cash flow model that included the Company’s market participant assumptions, forecasted future cash flows based on historical performance and future estimated results, determinations of appropriate discount rates, and other assumptions which were considered reasonable and inherent in the discounted cash flow analysis. The fair value estimate was based on known or knowable information at the assessment date. Significant assumptions used in the model included forecasted revenue and terminal growth rates, profit margins, income taxes, and the Company's weighted average cost of capital. The fair value measurements for reporting units are based on significant unobservable inputs, and thus represent Level 3 inputs.

Fair value measurements require considerable judgment and are sensitive to changes in underlying assumptions. As a result, there can be no assurance that estimates and assumptions made for purposes of the impairment assessment will prove to be an accurate prediction of the future. Potential circumstances that could have a negative effect on the fair value of our reporting units include, but are not limited to, lower than forecasted growth rates or profit margins and changes in the weighted average cost of capital. A reduction in the estimated fair value of the reporting units could trigger an impairment in the future. The Company cannot predict the occurrence of certain events or changes in circumstances that might adversely affect the carrying value of goodwill.

During the third quarter of 2022, the Company evaluated whether there were any events indicating that the carrying value of individual reporting units exceeded their respective fair values on a more likely than not basis. The Company concluded that no triggering event had occurred and thus no interim impairment assessment was performed.

9

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

Long-Lived Asset Impairment

The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company vacated its leased facility in Mountain View, California during the third quarter of 2020, resulting in its classification as a separate asset group. This facility was previously used by the Intelligent Audio product line, which is included within the Audio segment. Based on an assessment of market conditions, in particular the impact of the COVID-19 pandemic, the Company determined that the carrying amount of the asset group was not recoverable through undiscounted future cash flows, which included estimated sublease proceeds. The fair value of the operating lease right-of-use asset was determined by an estimate of discounted future cash flows that included estimated sublease proceeds and the determination of an appropriate discount rate based on market participant assumptions. The fair value measurements of operating lease right-of-use assets are based on significant unobservable inputs, and thus represent Level 3 inputs. During the three months ended September 30, 2021, the Company determined that the remaining carrying amount of the asset group was not recoverable through undiscounted future cash flows, which included estimated sublease proceeds, due to the prolonged impact of the COVID-19 pandemic on market conditions. Based on the excess of the carrying amount of the asset group over its fair value, the Company recorded an impairment loss of $3.2 million within Impairment charges in Operating expenses during the three months ended September 30, 2021.

The Company entered into an operating lease for a research and development facility in Santa Clara, California during the first quarter of 2020 that did not commence until the second quarter of 2021. Upon commencement, the Company recognized operating lease liabilities of $4.0 million and right-of-use assets of $2.4 million. During the three months ended September 30, 2021, the Company determined that the remaining carrying amount of the operating lease right-of-use asset was not recoverable through undiscounted future cash flows, which included estimated sublease proceeds, due to the prolonged impact of the COVID-19 pandemic on market conditions. Based on the excess of the carrying amount of the operating lease right-of-use asset over its fair value, the Company recorded an impairment loss of $0.8 million within Impairment charges in Operating expenses during the three months ended September 30, 2021.

5. Inventories, net

The following table details the major components of inventories, net:

(in millions)	September 30, 2022		December 31, 2021
Raw materials	$	117.0	$	89.6
Work in progress	32.8		33.6
Finished goods	84.1		66.7
Subtotal	233.9		189.9
Less reserves	(39.3)		(36.8)
Total	$	194.6	$	153.1

6. Property, Plant, and Equipment, net

The following table details the major components of property, plant, and equipment, net:

(in millions)	September 30, 2022		December 31, 2021
Land	$	12.3	$	12.9
Buildings and improvements	112.1		119.3
Machinery, equipment, and other	528.0		575.0
Subtotal	652.4		707.2
Less accumulated depreciation	(488.0)		(506.4)
Total	$	164.4	$	200.8

Depreciation expense totaled $9.8 million and $11.5 million for the three months ended September 30, 2022 and 2021, respectively. For the nine months ended September 30, 2022 and 2021, depreciation expense totaled $32.5 million and $35.1 million, respectively.

10

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

7. Goodwill and Other Intangible Assets

The changes in the carrying value of goodwill by reportable segment for the nine months ended September 30, 2022 are as follows:

(in millions)	Audio		Precision Devices		Total
Balance at December 31, 2021	$	878.8	$	62.5	$	941.3
Impairment charges (1)	(239.8)		—		(239.8)
Purchase price adjustment	—		0.7		0.7
Foreign currency translation	(0.1)		—		(0.1)
Balance at September 30, 2022	$	638.9	$	63.2	$	702.1
(1) During the nine months ended September 30, 2022, the Company recorded a $239.8 million impairment charge on goodwill. See Note 4. Impairment Charges for more information.

Other Intangible Assets

The gross carrying value and accumulated amortization for each major class of intangible assets are as follows:

	September 30, 2022				December 31, 2021
(in millions)	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets:
Trademarks	$	2.0	$	0.8	$	2.0	$	0.6
Customer relationships	36.4		9.2		36.4		5.9
Developed technology	45.4		18.4		45.4		13.2
Other	2.4		1.7		2.4		1.2
Total	86.2		30.1		86.2		20.9
Unamortized intangible assets:
Trademarks	32.0				32.0
Total intangible assets, net	$	88.1			$	97.3

Amortization expense totaled $3.1 million and $4.3 million for the three months ended September 30, 2022 and 2021, respectively. For the nine months ended September 30, 2022 and 2021, amortization expense was $9.2 million and $11.5 million, respectively. Amortization expense for the next five years, based on current definite-lived intangible balances, is estimated to be as follows:

(in millions)
Q4 2022	$	3.1
2023	11.6
2024	11.6
2025	11.2
2026	5.3

8. Restructuring and Related Activities

Restructuring and related activities are designed to better align the Company's operations with current market conditions through targeted facility consolidations, headcount reductions, and other measures to further optimize operations.

11

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

During the nine months ended September 30, 2022, the Company restructured its MEMS microphones product line through two restructuring programs, which are included within the Audio segment. These actions resulted in the settlement of supplier obligations, non-cash fixed asset write-offs, and severance pay. During the nine months ended September 30, 2022, the Company recorded restructuring charges of $35.1 million related to this action, including $21.9 million for the settlement of supplier obligations, $8.9 million in fixed asset write-offs, and $4.3 million in severance pay and benefits. The Company may incur additional restructuring charges of up to $9.4 million during the remainder of the fiscal year for certain fixed assets, which cannot be reasonably estimated at this time due to the complex nature of the assets under review for use in other projects.

In addition, during the nine months ended September 30, 2022, the Company recorded restructuring charges of $2.2 million for severance pay and benefits to rationalize the Intelligent Audio product line workforce, which is included within the Audio segment, and $0.6 million for other costs.

During the three and nine months ended September 30, 2022, the Company recorded total restructuring charges within Gross profit of $28.1 million, primarily for the settlement of supplier obligations, non-cash fixed asset write-offs, and severance pay associated with the MEMS microphones product line. During the three and nine months ended September 30, 2022, the Company recorded total restructuring charges within Operating expenses of $2.7 million and $9.8 million, respectively, primarily for the settlement of supplier obligations and severance pay and benefits associated with the MEMS microphones product line and other actions to rationalize the Intelligent Audio product line workforce.

No restructuring charges were recorded within Gross profit for the three and nine months ended September 30, 2021. During the nine months ended September 30, 2021, the Company recorded restructuring charges within Operating expenses of $0.3 million. No restructuring charges were recorded within Operating expenses for the three months ended September 30, 2021.

The following table details restructuring charges incurred by reportable segment for the periods presented:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2022		2021		2022		2021
Audio	$	30.7	$	—	$	37.3	$	0.3
Precision Devices	—		—		—		—
Corporate	0.1		—		0.6		—
Total	$	30.8	$	—	$	37.9	$	0.3

The following table details the Company’s severance and other restructuring accrual activity:

(in millions)	Severance Pay and Benefits		Contract Termination and Other Costs		Total
Balance at December 31, 2021	$	0.4	$	—	$	0.4
Restructuring charges	6.5		31.4		37.9
Payments	(3.8)		(1.0)		(4.8)
Other, including foreign currency (1)	(0.1)		(8.9)		(9.0)
Balance at September 30, 2022	$	3.0	$	21.5	$	24.5

(1) Other activity includes the non-cash disposal of fixed assets of $8.9 million within the MEMS microphones product line.

The severance and restructuring accruals are recorded in the following line item on the Consolidated Balance Sheets:

(in millions)	September 30, 2022		December 31, 2021
Other accrued expenses	$	6.6	$	0.4
Other liabilities	17.9		—
Total	$	24.5	$	0.4

12

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

9. Borrowings

Revolving Credit Facility

Revolving credit facility borrowings consist of the following:

(in millions)	September 30, 2022		December 31, 2021
Revolving credit facility	$	78.0	$	70.0
Less current maturities (1)	—		—
Total long-term debt	$	78.0	$	70.0

(1) There are no required principal payments due until maturity in January 2024.

On September 4, 2020, the Company entered into a new Credit Agreement (the "New Credit Agreement"). The New Credit Agreement provides for a senior secured revolving credit facility (the "New Credit Facility") with borrowings in an aggregate principal amount at any time outstanding not to exceed $400.0 million. The New Credit Agreement serves as refinancing of indebtedness and terminates the Company's Revolving Credit Facility Agreement dated as of October 11, 2017 ("Prior Credit Facility"). The Prior Credit Facility consisted of a $400.0 million senior secured revolving credit facility.

At any time during the term of the New Credit Facility, the Company will be permitted to increase the commitments under the New Credit Facility or to establish one or more incremental term loan facilities under the New Credit Facility in an aggregate principal amount not to exceed $200.0 million for all such incremental facilities. Commitments under the New Credit Facility will terminate, and loans outstanding thereunder will mature, on January 2, 2024.

The New Credit Agreement includes requirements, to be tested quarterly, that the Company maintains (i) a minimum ratio of Consolidated EBITDA to consolidated interest expense of 3.25 to 1.0 (the "Interest Coverage Ratio"), (ii) a maximum ratio of Consolidated total indebtedness to Consolidated EBITDA of 3.75 to 1.0 (the "Total Leverage Ratio"), and (iii) a maximum ratio of senior secured indebtedness to Consolidated EBITDA of 3.25 to 1.0 (the "Senior Secured Leverage Ratio"). For these ratios, Consolidated EBITDA and consolidated interest expense are calculated using the most recent four consecutive fiscal quarters in a manner defined in the New Credit Agreement. At September 30, 2022, the Company was in compliance with these covenants and it expects to remain in compliance with all of its debt covenants over the next twelve months.

The interest rates under the New Credit Facility will be, at the Borrowers' option (1) LIBOR (or EURIBOR for borrowings denominated in Euro; or SONIA for borrowings denominated in Pounds Sterling) plus the rates per annum determined from time to time based on the total leverage ratio of the Company as of the end of and for the most recent period of four fiscal quarters for which financial statements have been delivered (the "Applicable Margin"); or (2) in the case of borrowings denominated in U.S. dollars, alternate base rate ("ABR") (as defined in the New Credit Agreement) plus the Applicable Margin. The Applicable Margin for LIBOR could range from 1.50% to 2.50% while the Applicable Margin for ABR could range from 0.50% to 1.50%. Prior to the discontinuation of the relevant LIBOR reference rate on June 30, 2023, the Company and its lenders will agree on an ABR to address the replacement of LIBOR for the remaining life of the New Credit Facility.

The interest rate under the New Credit Facility is variable based on LIBOR at the time of the borrowing and the Applicable Margin. In addition, a commitment fee accrues on the average daily unused portion of the New Credit Facility at a rate of 0.225% to 0.375%.

The weighted-average interest rate on the Company's borrowings under the New Credit Facility was 2.62% for the nine months ended September 30, 2022. There were no borrowings outstanding under the New Credit Facility during the nine months ended September 30, 2021. The weighted-average commitment fee on the revolving line of credit was 0.23% and 0.26% for the nine months ended September 30, 2022 and 2021, respectively.

13

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

3.25% Convertible Senior Notes Due November 1, 2021

In May 2016, the Company issued $172.5 million aggregate principal amount of 3.25% convertible senior notes which matured on November 1, 2021 (the “Notes”). Interest was payable semiannually in arrears on May 1 and November 1 of each year. The Notes were governed by an Indenture between the Company, as issuer, and U.S. Bank National Association as trustee. Upon conversion, the Company could elect to pay or deliver cash, shares of the Company's common stock, or a combination of cash and shares of common stock. On November 1, 2021, the Company settled the principal amount of the Notes in cash and the excess conversion value by delivering 0.4 million shares of its common stock held in treasury. The conversion rate was 54.2741 shares of common stock per $1,000 principal amount of Notes. The conversion price was $18.4250 per share of common stock. The Notes were senior unsecured obligations.

In accounting for the issuance of the Notes, the Company separated the Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that did not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the face value of the Notes as a whole. The excess of the principal amount of the liability component over its carrying amount was amortized to interest expense over the term of the Notes.

The following table sets forth total interest expense recognized related to the Notes:

	Three Months Ended			Nine Months Ended
(in millions)		September 30, 2021		September 30, 2021
3.25% coupon		$	1.4	$	4.2
Amortization of debt issuance costs		0.2		0.7
Amortization of debt discount		2.1		6.0
Total		$	3.7	$	10.9

Warrants

In the second quarter of 2016, the Company entered into warrant transactions, whereby the Company sold warrants to acquire shares of the Company's common stock at a strike price of $21.1050 per share (the “Warrants”). The Company received aggregate proceeds of $39.1 million from the sale of the Warrants. The Warrants were separate transactions entered into by the Company, and were not part of the Notes, and were accounted for as part of additional paid-in capital.

The Warrants expired during the first quarter of 2022, which resulted in the Company delivering 0.2 million shares of its common stock held in treasury. Settlement of the Warrants resulted in a $3.1 million decrease in treasury stock, which was measured based on the acquisition cost of the delivered shares determined on a first-in, first-out (“FIFO”) basis, offset by an equivalent decrease in additional paid-in capital with no net impact to equity.

14

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

10. Other Comprehensive Earnings

The amounts recognized in other comprehensive loss were as follows:

	Three Months Ended						Three Months Ended
	September 30, 2022						September 30, 2021
(in millions)	Pre-tax		Tax		Net of tax		Pre-tax		Tax		Net of tax
Foreign currency translation	$	(13.1)	$	—	$	(13.1)	$	(3.7)	$	—	$	(3.7)
Employee benefit plans	0.2		(0.4)		(0.2)		0.2		(0.1)		0.1
Changes in fair value of cash flow hedges	(1.3)		—		(1.3)		(0.3)		0.2		(0.1)
Total other comprehensive loss	$	(14.2)	$	(0.4)	$	(14.6)	$	(3.8)	$	0.1	$	(3.7)
	Nine Months Ended						Nine Months Ended
	September 30, 2022						September 30, 2021
(in millions)	Pre-tax		Tax		Net of tax		Pre-tax		Tax		Net of tax
Foreign currency translation	$	(30.9)	$	—	$	(30.9)	$	(6.4)	$	—	$	(6.4)
Employee benefit plans	0.5		(0.7)		(0.2)		0.6		0.1		0.7
Changes in fair value of cash flow hedges	(4.1)		0.3		(3.8)		(2.1)		0.2		(1.9)
Total other comprehensive loss	$	(34.5)	$	(0.4)	$	(34.9)	$	(7.9)	$	0.3	$	(7.6)

The following tables summarize the changes in balances of each component of accumulated other comprehensive loss, net of tax during the nine months ended September 30, 2022 and 2021:

(in millions)	Cash flow hedges		Employee benefit plans		Cumulative foreign currency translation adjustments		Total
Balance at December 31, 2021	$	0.3	$	(17.1)	$	(83.6)	$	(100.4)
Other comprehensive loss, net of tax	(3.8)		(0.2)		(30.9)		(34.9)
Balance at September 30, 2022	$	(3.5)	$	(17.3)	$	(114.5)	$	(135.3)

(in millions)	Cash flow hedges		Employee benefit plans		Cumulative foreign currency translation adjustments		Total
Balance at December 31, 2020	$	1.6	$	(22.1)	$	(80.0)	$	(100.5)
Other comprehensive (loss) earnings, net of tax	(1.9)		0.7		(6.4)		(7.6)
Balance at September 30, 2021	$	(0.3)	$	(21.4)	$	(86.4)	$	(108.1)

15

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

The following tables summarize the amounts reclassified from accumulated other comprehensive loss to earnings:

		Three Months Ended September 30,
(in millions)	Statement of Earnings Line	2022		2021
Pension and post-retirement benefit plans:
Amortization or settlement of actuarial losses and prior service costs	Other income, net	$	0.2	$	0.2
Tax	(Benefit from) provision for income taxes	(0.4)		(0.1)
Net of tax		$	(0.2)	$	0.1
Cash flow hedges:
Net losses reclassified into earnings	Cost of goods sold	$	2.0	$	—
Tax	(Benefit from) provision for income taxes	(0.3)		0.1
Net of tax		$	1.7	$	0.1
		Nine Months Ended September 30,
(in millions)	Statement of Earnings Line	2022		2021
Pension and post-retirement benefit plans:
Amortization or settlement of actuarial losses and prior service costs	Other income, net	$	0.5	$	0.6
Tax	(Benefit from) provision for income taxes	(0.7)		0.1
Net of tax		$	(0.2)	$	0.7
Cash flow hedges:
Net losses (gains) reclassified into earnings	Cost of goods sold	$	2.7	$	(1.9)
Tax	(Benefit from) provision for income taxes	(0.4)		0.5
Net of tax		$	2.3	$	(1.4)

11. Income Taxes

Income taxes for the interim periods presented have been included in the accompanying Consolidated Financial Statements on the basis of an estimated annual effective tax rate ("ETR"). The determination of the consolidated provision for income taxes requires management to make certain judgments and estimates. Changes in the estimated level of annual pre-tax earnings or loss, tax laws, and changes resulting from tax audits can affect the overall ETR, which impacts the level of income tax expense or benefit and net income or loss. Judgments and estimates related to the Company’s projections and assumptions are inherently uncertain and therefore, actual results could differ materially from projections.

The Company's ETR from continuing operations for the three and nine months ended September 30, 2022, respectively, was 119.9% resulting in $16.3 million of tax benefit, and (5.9)% resulting in $12.4 million of tax expense (inclusive of discrete items totaling $1.6 million of benefit). The provision for the nine months ended September 30, 2022 is the result of estimated tax expense for the year in relation to the estimated pre-tax loss for the year, which when applied to the pre-tax loss results in tax expense. The discrete items impacting the tax provision for the three and nine months ended September 30, 2022 were primarily attributable to the stock-based compensation deduction. Absent the discrete items, the ETR from continuing operations for the three and nine months ended September 30, 2022 was 119.9% and (6.7)%, respectively. During the three and nine months ended September 30, 2021, the ETR from continuing operations was a 14.2% provision (inclusive of discrete items totaling $0.4 million of provision) and a 13.1% provision (inclusive of discrete items totaling $0.9 million of benefit), respectively. Absent the discrete items, the ETR from continuing operations for the three and nine months ended September 30, 2021 was a 13.0% provision and a 14.5% provision, respectively. The Company accrues taxes in various countries where it generates income and applies a valuation allowance in other jurisdictions, which resulted in the provision for the three and nine months ended September 30, 2022 and 2021.

16

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

The Company's ETR is favorably impacted by tax holidays granted to the Company in Malaysia and China. The Company secured the Chinese tax holiday in the first quarter of 2022. These tax holidays are subject to the Company's annual satisfaction of certain conditions, including investment and sales thresholds. If the Company fails to satisfy such conditions, the Company's ETR may be significantly adversely impacted. The continuing operations impact of the tax holidays in Malaysia and China for the three and nine months ended September 30, 2022 was approximately a $4.0 million expense and a $0.9 million benefit, respectively, or $(0.04) and $0.01 on a basic (loss) earnings per share basis. The $4.0 million expense for the three months ended September 30, 2022 was attributable to the MEMS microphones product line restructuring activities in Malaysia and China. The continuing operations benefit of these incentives for the three and nine months ended September 30, 2021 was approximately $3.9 million and $9.3 million, respectively, or $0.04 and $0.10 on a basic earnings per share basis. The Company's existing significant tax holiday in Malaysia will expire on December 31, 2026, while the tax holiday in China will expire on December 31, 2023.

12. Equity Incentive Program

Stock-based compensation expense recognized in the Consolidated Statements of Earnings totaled $6.8 million and $7.1 million for the three months ended September 30, 2022 and 2021, respectively. For the nine months ended September 30, 2022 and 2021, stock-based compensation expense was $21.6 million and $25.6 million, respectively. The tax benefit recognized related to stock-based compensation expense was $0.1 million and $4.1 million for the three and nine months ended September 30, 2022, respectively. No tax benefit was recognized related to stock-based compensation expense for the three and nine months ended September 30, 2021.

Stock Options and SSARs

The expense related to stock options granted in the nine months ended September 30, 2022 and 2021 was estimated on the date of grant using a Black-Scholes option-pricing model based on the assumptions shown in the table below:

	Nine Months Ended September 30,
	2022	2021
Risk-free interest rate	0.85%	0.06%
Dividend yield	—%	—%
Expected life (years)	4.5	4.5
Volatility	34.3%	36.0%
Fair value at date of grant	$6.29	$6.14	to	$6.31

The following table summarizes the Company's stock-settled stock appreciation right ("SSAR") and stock option activity for the nine months ended September 30, 2022:

	SSARs						Stock Options
	Number of Shares	Weighted-Average Exercise Price		Aggregate Intrinsic Value		Weighted-Average Remaining Contractual Term (Years)	Number of Shares	Weighted-Average Exercise Price		Aggregate Intrinsic Value		Weighted-Average Remaining Contractual Term (Years)
(in millions, except share and per share amounts)
Outstanding at December 31, 2021	375,964	$	23.16				3,478,438	$	15.04
Granted	—	—					216,813	21.14
Exercised	(36,759)	21.77					(529,199)	12.21
Forfeited	—	—					(69,873)	20.63
Expired	(95,573)	21.77					(12,222)	17.41
Outstanding at September 30, 2022	243,632	$	23.92	$	—	0.4	3,083,957	$	15.82	$	0.7	2.7
Exercisable at September 30, 2022	243,632	$	23.92	$	—	0.4	2,582,778	$	15.17	$	0.7	2.2

There was no unrecognized compensation expense related to SSARs at September 30, 2022. At September 30, 2022, unrecognized compensation expense related to stock options not yet exercisable of $1.7 million is expected to be recognized over a weighted-average period of 1.3 years.

17

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

RSUs

The following table summarizes the Company's restricted stock unit ("RSU") activity for the nine months ended September 30, 2022:

	Share units	Weighted-average grant date fair value
Unvested at December 31, 2021	1,778,639	$	18.89
Granted	1,203,872	20.55
Vested (1)	(817,082)	18.17
Forfeited	(243,411)	20.15
Unvested at September 30, 2022	1,922,018	$	20.04

(1) The number of RSUs vested includes shares that the Company withheld on behalf of employees to satisfy statutory tax withholding requirements.

At September 30, 2022, $25.3 million of unrecognized compensation expense related to RSUs is expected to be recognized over a weighted-average period of 1.8 years.

PSUs

The Company grants performance share units (“PSUs”) to senior management. In each case, the awards will cliff vest three years following the grant date. PSUs will be settled in shares of the Company's common stock. Depending on the Company's overall performance relative to the applicable measures, the size of the PSU awards are subject to adjustment, up or down, resulting in awards at the end of the performance period that can range from 0% to 225% of target. The Company will ratably recognize the expense over the applicable service period for each grant of PSUs and adjust the expense for the expected achievement of performance conditions as appropriate. The fair value of PSUs is determined by using a Monte Carlo simulation. For the awards granted in February 2022 and 2021, the number of PSUs that may be earned and vest is based on total shareholder return (“TSR”) relative to the component companies of the Russell 2000 Index over a three-year performance period.

The COVID-19 pandemic brought on unique and unprecedented challenges to the Company, particularly in the hearing health and medtech markets. Many of the Company's executive compensation programs were affected, including outstanding PSU awards. Due to the impact of the COVID-19 pandemic on the Company’s overall business performance, effective February 8, 2021, the Company’s Compensation Committee approved certain modifications to PSUs granted in February 2018, 2019, and 2020.

For the awards granted in February 2018 (the “2018 PSUs”), the number of PSUs that may be earned and vest was originally based on the Company’s revenues and stock price performance over a three-year performance period. The modified award was based on the Company’s revenues and stock price performance over three separate one-year performance periods to isolate the impact of the COVID-19 pandemic on the Company's fiscal 2020 performance. In addition, the performance periods corresponding to fiscal 2018 and 2019 were weighted at 25% each while the performance period corresponding to fiscal 2020 was weighted at 50%, given the impact of fiscal 2020 performance on shareholders. Service conditions were not modified. The modification of the 2018 PSUs affected nine employees and resulted in total incremental compensation expense of $3.9 million, which was recognized in the first quarter of 2021 as there was no remaining service period. In February 2021, the 2018 PSUs were converted from 329,092 PSUs to 190,544 shares of common stock based on achievement of the modified conditions.

18

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

For the awards granted in February 2019 (the “2019 PSUs”), the number of PSUs that may be earned and vest was originally based on the Company's revenues and TSR relative to the component companies of the S&P Semiconductor Select Industry Index over a three-year performance period. The modified award was based on the Company’s revenues and TSR relative to the component companies of the S&P Semiconductor Select Industry Index over three separate one-year performance periods to isolate the impact of the COVID-19 pandemic on the Company's fiscal 2020 performance. Each period was weighted equally, as the Company expected to face challenges related to the COVID-19 pandemic in fiscal 2021. Service conditions were not modified. The modification of the 2019 PSUs affected eight employees and resulted in total incremental compensation expense of $2.4 million, which was recognized over the remaining service period. Incremental compensation expense was subject to adjustment for the achievement of the performance condition based on fiscal 2021 revenues. In February 2022, the 2019 PSUs were converted from 227,812 PSUs to 150,811 shares of common stock based on achievement of the modified conditions.

For the awards granted in February 2020 (the “2020 PSUs”), the number of PSUs that may be earned and vest was originally based on TSR relative to the component companies of the S&P Semiconductor Select Industry Index over a three-year performance period. The modified award replaces the S&P Semiconductor Select Industry Index with the Russell 2000 Index. The Company is a member of the Russell 2000 Index, which represents a broader, more diversified index that better aligns with the Company's strategy. Service conditions were not modified. The modification of the 2020 PSUs affected eight employees and resulted in total incremental compensation expense of $4.7 million, which will be recognized over the remaining service period.

The following table summarizes the Company's PSU activity for the nine months ended September 30, 2022:

	Share units	Weighted-average grant date fair value
Unvested at December 31, 2021	766,466	$	21.28
Granted	294,935	29.92
Vested (1)	(227,812)	18.44
Forfeited	—	—
Unvested at September 30, 2022	833,589	$	25.12

(1) The number of PSUs vested includes shares that the Company withheld on behalf of employees to satisfy statutory tax withholding requirements.

At September 30, 2022, $11.8 million of unrecognized compensation expense related to PSUs is expected to be recognized over a weighted-average period of 1.4 years.

19

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

13. Earnings per Share

Basic and diluted earnings per share were computed as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions, except per share amounts)	2022		2021		2022		2021
Earnings (loss) from continuing operations	$	2.7	$	27.7	$	(222.1)	$	57.6
Earnings from discontinued operations, net	—		—		—		0.2
Net earnings (loss)	$	2.7	$	27.7	$	(222.1)	$	57.8
Basic earnings (loss) per common share:
Earnings (loss) from continuing operations	$	0.03	$	0.30	$	(2.42)	$	0.62
Earnings from discontinued operations, net	—		—		—		0.01
Net earnings (loss)	$	0.03	$	0.30	$	(2.42)	$	0.63
Weighted-average shares outstanding	91.4		92.2		91.9		92.3
Diluted earnings (loss) per common share:
Earnings (loss) from continuing operations	$	0.03	$	0.29	$	(2.42)	$	0.61
Earnings from discontinued operations, net	—		—		—		—
Net earnings (loss)	$	0.03	$	0.29	$	(2.42)	$	0.61
Weighted-average shares outstanding	92.0		94.1		91.9		94.8

The Company intended to settle the principal amount of the Notes in cash during all periods preceding settlement. The treasury stock method was used to calculate the dilutive effect of the conversion option on diluted earnings per share, if applicable. For the three and nine months ended September 30, 2022, the weighted-average number of anti-dilutive potential common shares for stock-based awards excluded from the diluted earnings per share calculation above was 3.2 million and 3.0 million, respectively. For the three and nine months ended September 30, 2021, the weighted-average number of anti-dilutive potential common shares for stock-based awards excluded from the diluted earnings per share calculation above was 1.1 million and 1.3 million, respectively.

14. Commitments and Contingent Liabilities

From time to time, the Company is involved in various legal proceedings and claims arising in the ordinary course of its business. The majority of these claims and proceedings relate to commercial, warranty, employment, and intellectual property matters. Although the ultimate outcome of any legal proceeding or claim cannot be predicted with certainty, based on present information, including management’s assessment of the merits of the particular claim, the Company believes that the disposition of these legal proceedings or claims, individually or in the aggregate, after taking into account recorded accruals and the availability and limits of insurance coverage, will not have a material adverse effect on its cash flow, results of operations, or financial condition.

The Company owns many patents and other intellectual property pertaining to its products, technology, and manufacturing processes. Some of the Company's patents have been and may continue to be infringed upon or challenged by others. In appropriate cases, the Company has taken and will take steps to protect and defend its patents and other intellectual property, including through the use of legal proceedings in various jurisdictions around the world. Such steps have resulted in and may continue to result in retaliatory legal proceedings, including litigation or other legal proceedings in various jurisdictions and forums around the world alleging infringement by the Company of patents owned by others. The costs of investigations and legal proceedings relating to the enforcement and defense of the Company’s intellectual property may be substantial. Additionally, in multi-forum disputes, the Company may incur adverse judgments with regard to certain claims in certain jurisdictions and forums while still contesting other related claims against the same opposing party in other jurisdictions and forums.

20

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

Intellectual Property Infringement Claims

The Company may, on a limited customer specific basis, provide contractual indemnities for certain losses that arise out of claims that its products infringe on the intellectual property of others. It is not possible to determine the maximum potential amount under these indemnification agreements due to the unique facts and circumstances involved in each particular agreement. Historically, the Company has not made significant payments under such indemnity arrangements. The Company’s legal accruals associated with these indemnity arrangements were not significant at September 30, 2022 and December 31, 2021.

15. Segment Information

The Company's two reportable segments are Audio and Precision Devices. Information regarding the Company's reportable segments is as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2022		2021		2022		2021
Revenues:
Audio	$	113.8	$	177.7	$	388.0	$	490.6
Precision Devices	64.4		55.3		179.6		143.2
Total revenues	$	178.2	$	233.0	$	567.6	$	633.8
(Loss) earnings from continuing operations before interest and income taxes:
Audio	$	(16.9)	$	36.6	$	(210.9)	$	95.0
Precision Devices	16.2		14.0		39.5		28.3
Total segments	(0.7)		50.6		(171.4)		123.3
Corporate expense / other	11.8		14.1		35.6		44.7
Interest expense, net	1.1		4.2		2.7		12.3
(Loss) earnings before income taxes and discontinued operations	(13.6)		32.3		(209.7)		66.3
(Benefit from) provision for income taxes	(16.3)		4.6		12.4		8.7
Earnings (loss) from continuing operations	$	2.7	$	27.7	$	(222.1)	$	57.6

Information regarding assets of the Company's reportable segments:

	Total Assets
(in millions)	September 30, 2022		December 31, 2021
Audio	$	1,149.2	$	1,467.1
Precision Devices	285.2		260.4
Corporate / eliminations	2.3		4.1
Total	$	1,436.7	$	1,731.6

21

Table of Contents	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	(unaudited)

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. The Company's businesses are based primarily in Asia, North America, and Europe.

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2022		2021		2022		2021
Asia	$	105.3	$	163.4	$	347.2	$	452.0
United States	43.7		42.2		129.3		109.3
Europe	24.5		24.6		80.2		65.4
Other Americas	2.9		1.6		5.5		3.9
Other	1.8		1.2		5.4		3.2
Total	$	178.2	$	233.0	$	567.6	$	633.8

Receivables, net from contracts with customers were $118.3 million and $137.7 million as of September 30, 2022 and December 31, 2021, respectively. As of September 30, 2022 and December 31, 2021, our total remaining performance obligations were immaterial.

22

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 relating to our operations, results of operations, our continued business operations during the COVID-19 pandemic, and other matters that are based on our current expectations, estimates, assumptions, and projections, including statements related to the expected impact of our restructuring program and estimates of timing and amounts of restructuring charges. Words such as “believe,” “expect,” “anticipate,” “project,” “estimate,” “budget,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “seek,” “should,” “will,” “would,” “objective,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target,” and similar expressions, among others, generally identify forward-looking statements, which speak only as of the date the statements were made. The statements in this Quarterly Report on Form 10-Q are based on currently available information and the current expectations, forecasts, and assumptions of our management concerning risks and uncertainties that could cause actual outcomes or results to differ materially from those outcomes or results that are projected, anticipated, or implied in these statements, including risks relating to the timing and execution of the restructuring program, and risks related to the COVID-19 pandemic and governmental responses to it, including but not limited to, the impact on our supply chain, customer demand, and costs associated with our operations. Other risks and uncertainties include, but are not limited to:

o unforeseen changes in MEMS microphone demand from our largest customers, particularly our top five customers, who represent a significant portion of revenues for our Audio segment;

o our ongoing ability to execute our strategy to diversify our end markets and customers;

o our ability to stem or overcome price erosion in our segments;

o fluctuations in our stock's market price;

o fluctuations in operating results and cash flows;

o our ability to prevent or identify quality issues in our products or to promptly remedy any such issues that are identified;

o the timing of OEM product launches;

o risks associated with increasing our inventories in advance of anticipated orders by customers;

o global economic instability;

o the impact of changes to laws and regulations that affect the Company’s ability to offer products or services to customers in different regions;

o our ability to achieve reductions in our operating expenses;

o the ability to qualify our products and facilities with customers;

o our ability to obtain, enforce, defend, or monetize our intellectual property rights;

o disruption caused by a cybersecurity incident, including a cyber attack, cyber breach, theft, or other unauthorized access;

o difficulties or delays in and/or the Company's inability to realize expected cost synergies from its acquisitions;

o increases in the costs of critical raw materials and components;

o availability of raw materials and components;

o managing new product ramps and introductions for our customers;

o our dependence on a limited number of large customers;

o our ability to maintain and expand our existing relationships with leading OEMs in order to maintain and increase our revenue;

o increasing competition and new entrants in the market for our products;

o our ability to develop new or enhanced products or technologies in a timely manner that achieve market acceptance;

o our reliance on third parties to manufacture, assemble, and test our products and sub-components;

o escalating international trade tensions, new or increased tariffs, and trade wars among countries;

o financial risks, including risks relating to currency fluctuations, credit risks, and fluctuations in the market value of the Company;

o a sustained decline in our stock price and market capitalization may result in the impairment of certain intangible or long-lived assets;

o market risk associated with fluctuations in commodity prices, particularly for various precious metals used in our manufacturing operation; and

o changes in tax laws, changes in tax rates, and exposure to additional tax liabilities.

A more complete description of these risks, uncertainties, and other factors can be found under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021. We do not undertake to update or revise our forward-looking statements as a result of new information, future events, or otherwise, except as required by law.

23

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

The following discussion and analysis should be read in conjunction with our Consolidated Financial Statements and related Notes included elsewhere in this Quarterly Report on Form 10-Q.

Overview

We are a market leader and global provider of advanced micro-acoustic microphones and balanced armature speakers, audio solutions, and high performance capacitors and radio frequency ("RF") products, serving the consumer electronics, medtech, defense, electric vehicle, industrial, and communications markets. We use our leading position in SiSonic™ micro-electro-mechanical systems ("MEMS") microphones and strong capabilities in audio processing technologies to optimize audio systems and improve the user experience across consumer applications. We are also a leader in hearing health acoustics, high performance capacitors, and RF solutions for a diverse set of markets. Our focus on the customer, combined with unique technology, proprietary manufacturing techniques, and global operational expertise, enables us to deliver innovative solutions across multiple applications. References to "Knowles," the "Company," "we," "our," or "us" refer to Knowles Corporation and its consolidated subsidiaries, unless the context otherwise requires.

We are organized into two reportable segments based on how management analyzes performance, allocates capital, and makes strategic and operational decisions. These segments were determined in accordance with Financial Accounting Standards Board Accounting Standards Codification 280 - Segment Reporting and are comprised of (i) Audio and (ii) Precision Devices ("PD"). The segments are aligned around similar product applications serving our key end markets, to enhance focus on end market growth strategies.

•Audio Segment

Our Audio group designs and manufactures innovative audio products, including microphones, balanced armature speakers, and audio processors used in applications that serve the mobile, hearing health, True Wireless Stereo ("TWS"), Internet of Things ("IoT"), and computing markets. Audio has sales, support, and engineering facilities in North America, Europe, and Asia, as well as manufacturing facilities in Asia.

•PD Segment

Our PD group specializes in the design and delivery of high performance capacitor products and RF solutions for technically demanding applications. Our high performance capacitor products are used in applications such as power supplies and medical implants, which sell to a diverse set of customers for mission critical applications across the defense, medtech, industrial, electric vehicle, and communications markets. Our RF solutions solve a broad range of frequency filtering challenges for our customers, who use them in satellite communications and radar systems for defense applications. RF solutions are also used in mmWave 5G communications equipment. PD has sales, support, and engineering facilities in North America, Europe, and Asia as well as manufacturing facilities in North America and Asia.

We sell our products directly to original equipment manufacturers ("OEMs") and to their contract manufacturers and suppliers and through distributors worldwide.

IMC Acquisition

On May 3, 2021, we acquired all of the outstanding shares of common stock of Integrated Microwave Corporation ("IMC") for $81.4 million. The acquired business provides RF filters to the defense, industrial, and communications markets. The acquisition's operations are included in the PD segment. For additional information, refer to Note 3. Acquisition to our Consolidated Financial Statements.

COVID-19 Update

The COVID-19 pandemic, particularly as it relates to the emergence of new variants of the virus, continues to have widespread, rapidly-evolving, and unpredictable impacts in the U.S. and international markets. Some countries have continued applying significant containment and mitigation measures, resulting in global business disruption. These measures have impacted our business operations, results of operations, customer demand, and the productivity of our facilities, particularly in China, Malaysia, and the Philippines.

COVID-19 mitigation measures in China (such as lockdowns) have had, and may continue to have, an adverse impact on various aspects of our business. Specifically, demand for some of our products, particularly in our MEMS microphones product line continued to be negatively impacted during the first nine months of 2022. While we have not experienced a similar impact on demand with respect to our hearing health products or in our PD segment, new or prolonged lockdowns may result in an adverse impact on demand across more of our product lines. We are actively engaging with our customers, and to date, have not seen significant requests for potential payment deferrals, pricing concessions, delays of deliveries, or other contract modifications. We also continue to manage the ongoing impacts of the supply chain challenges that are impacting many industries, and have been exacerbated by the lockdowns in China, causing shipping and logistics challenges, and limiting component supplies.

The situation related to COVID-19 continues to be complex and dynamic. We cannot reasonably estimate the duration of the pandemic or fully ascertain its impact to our future results. As the COVID-19 pandemic evolves, we will continue to actively monitor developments and business conditions and may take actions that alter business operations as may be required by applicable authorities or that we determine are in the best interests of our employees, customers, suppliers, stockholders, and communities. It is not clear what potential effects any such alterations or modifications may have on our business, including the effects on our financial results. For additional information regarding risks related to COVID-19, please see Item 1A, Risk Factors, in the Annual Report on Form 10-K for the year ended December 31, 2021.

Non-GAAP Financial Measures

In addition to the GAAP financial measures included in this item, we have presented certain non-GAAP financial measures. We use non-GAAP measures as supplements to our GAAP results of operations in evaluating certain aspects of our business, and our executive management team and Board of Directors focus on non-GAAP items as key measures of our performance for business planning purposes. These measures assist us in comparing our performance between various reporting periods on a consistent basis, as these measures remove from operating results the impact of items that, in our opinion, do not reflect our core operating performance. We believe that our presentation of non-GAAP financial measures is useful because it provides investors and securities analysts with the same information that we use internally for purposes of assessing our core operating performance. The Company does not consider these non-GAAP financial measures to be a substitute for the information provided by GAAP financial results. For a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures, see the reconciliation included herein.

24

Results of Operations for the Three Months Ended September 30, 2022 compared with the Three Months Ended September 30, 2021

	Three Months Ended September 30,
(in millions, except per share amounts)	2022		2021
Revenues	$	178.2	$	233.0
Gross profit	$	40.0	$	96.9
Non-GAAP gross profit	$	68.6	$	97.5
(Loss) earnings from continuing operations before interest and income taxes	$	(12.5)	$	36.5
Adjusted earnings from continuing operations before interest and income taxes	$	28.2	$	52.6
(Benefit from) provision for income taxes	$	(16.3)	$	4.6
Non-GAAP provision for income taxes	$	3.8	$	7.5
Earnings from continuing operations	$	2.7	$	27.7
Non-GAAP net earnings	$	23.3	$	43.0
Diluted earnings per share from continuing operations	$	0.03	$	0.29
Non-GAAP diluted earnings per share	$	0.25	$	0.45

Revenues

Revenues for the third quarter of 2022 were $178.2 million, compared with $233.0 million for the third quarter of 2021, a decrease of $54.8 million or 23.5%. Audio revenues decreased $63.9 million, primarily due to lower demand for MEMS microphones in the mobile, computing, and IoT markets. The decreases in these markets were primarily driven by weak global demand for consumer electronics, COVID-19 related shutdowns in China, excess inventory in the supply chain, and our shift away from commoditized products. In addition, the hearing health market demand was lower primarily due to pull forward of demand from our customers into the first six months of the year. Audio revenues were also impacted by lower average pricing on mature products. PD revenues increased $9.1 million, due to growth from the defense, medtech, and electric vehicle markets.

Cost of Goods Sold

Cost of goods sold ("COGS") for the third quarter of 2022 was $110.1 million, compared with $136.1 million for the third quarter of 2021, a decrease of $26.0 million or 19.1%. This decrease was primarily due to lower shipping volumes, product cost reductions, and favorable foreign currency exchange rate changes, partially offset by lower factory capacity utilization in our MEMS microphone business.

25

Restructuring Charges

During the third quarter of 2022, we committed to a restructuring program within our Audio segment designed to rightsize manufacturing capacity and operating expenses in the MEMS microphones product line. This action was taken in light of the current decline in demand and the reduction in the expected future growth for global consumer electronics. In addition, this restructuring program furthers the Company's previously announced strategy to reduce exposure to commodity microphones and increase emphasis on high-value solutions. This action resulted in the settlement of supplier obligations, non-cash fixed asset write-offs, and severance pay. We recorded restructuring charges of $29.8 million related to this action. We may incur additional restructuring charges of up to $5.0 million during the remainder of the fiscal year for certain fixed assets of the terminated projects, which cannot be reasonably estimated at this time due to the complex nature of the assets under review for use in other projects. In addition, we recorded restructuring charges of $1.0 million to rationalize the Intelligent Audio product line workforce, which is also included within the Audio segment. As a result, we recorded total restructuring charges of $28.1 million within Gross Profit and $2.7 million within Operating expenses. For additional information, refer to Note 8. Restructuring and Related Activities to our Consolidated Financial Statements.

During the third quarter of 2021, there were no restructuring charges within Gross profit or Operating expenses.

Gross Profit and Non-GAAP Gross Profit

Gross profit for the third quarter of 2022 was $40.0 million, compared with $96.9 million for the third quarter of 2021, a decrease of $56.9 million or 58.7%. Gross profit margin (gross profit as a percentage of revenues) for the third quarter of 2022 was 22.4%, compared with 41.6% for the third quarter of 2021. The decreases were primarily due to restructuring charges, lower shipping volumes, lower factory capacity utilization in our MEMS microphone business, and lower average pricing on mature products, partially offset by product cost reductions and favorable foreign currency exchange rate changes.

Non-GAAP gross profit for the third quarter of 2022 was $68.6 million, compared with $97.5 million for the third quarter of 2021, a decrease of $28.9 million or 29.6%. Non-GAAP gross profit margin (non-GAAP gross profit as a percentage of revenues) for the third quarter of 2022 was 38.5%, compared with 41.8% for the third quarter of 2021. The decreases were primarily due to lower shipping volumes, lower factory capacity utilization in our MEMS microphone business, and lower average pricing on mature products, partially offset by product cost reductions and favorable foreign currency exchange rate changes.

Research and Development Expenses

Research and development expenses for the third quarter of 2022 were $19.3 million, compared with $22.3 million for the third quarter of 2021, a decrease of $3.0 million or 13.5%. Research and development expenses as a percentage of revenues for the third quarter of 2022 and 2021 were 10.8% and 9.6%, respectively. The decrease in expenses was primarily driven by reduced spending in our MEMS microphones product line, reduced development activities in our Intelligent Audio product line, and lower incentive compensation costs, partially offset by increased development activities in our precision devices product line. The increase in expenses as a percentage of revenues was driven by our lower revenues.

Selling and Administrative Expenses

Selling and administrative expenses for the third quarter of 2022 were $32.6 million, compared with $36.0 million for the third quarter of 2021, a decrease of $3.4 million or 9.4%. Selling and administrative expenses as a percentage of revenues for the third quarter of 2022 and 2021 were 18.3% and 15.5%, respectively. The decrease in expenses was primarily driven by lower incentive compensation costs. The increase in expenses as a percentage of revenues was driven by our lower revenues.

Impairment Charges

No impairment charges were recorded for the third quarter of 2022. Impairment charges for the third quarter of 2021 were $4.0 million, related to facilities in our Intelligent Audio product line. For additional information related to these impairment charges, refer to Note 4. Impairment Charges to our Consolidated Financial Statements.

26

Interest Expense, net

Interest expense for the third quarter of 2022 was $1.1 million, compared to $4.2 million for the third quarter of 2021, a decrease of $3.1 million. The decrease was primarily due to lower outstanding borrowings. For additional information on borrowings and interest expense, refer to Note 9. Borrowings to our Consolidated Financial Statements.

Other Income, net

Other income for the third quarter of 2022 was $2.1 million, compared with income of $1.9 million for the third quarter of 2021, a change of $0.2 million. The change is primarily due to favorable impacts from foreign currency exchange rate changes.

Provision for Income Taxes and Non-GAAP Provision for Income Taxes

The effective tax rate ("ETR") from continuing operations for the third quarter of 2022 and 2021, respectively, was 119.9% and a 14.2% provision (inclusive of discrete items totaling $0.4 million of provision). Absent the discrete items, the ETR from continuing operations for the third quarter of 2022 and 2021 was 119.9% and a 13.0% provision, respectively. The Company accrues taxes in various countries where it generates income and applies a valuation allowance in other jurisdictions, which resulted in the benefit and provision for the third quarter of 2022 and 2021, respectively. The change in the ETR from continuing operations was mainly due to the book goodwill impairment recorded in the second quarter of 2022, as well as the mix of earnings and losses by taxing jurisdictions and net discrete items.

The non-GAAP ETR from continuing operations for the third quarter of 2022 and 2021, respectively, was a 14.0% provision and a 14.9% provision (inclusive of discrete items totaling $0.4 million of provision). Absent the discrete items, the non-GAAP ETR from continuing operations for the third quarter of 2022 was a 14.0% provision, compared to a 14.1% provision for the third quarter of 2021. The change in the non-GAAP ETR from continuing operations was due to the mix of earnings and losses by taxing jurisdictions and net discrete items.

The ETR and non-GAAP ETR deviate from the statutory U.S. federal income tax rate, mainly due to the taxing jurisdictions where we generate taxable income or loss as well as the favorable impact of our tax holidays in Malaysia and China. A significant portion of our pre-tax income is subject to a lower tax rate as a result of our Malaysian and Chinese tax holidays, subject to our annual satisfaction of certain conditions we expect to continue to satisfy through the holiday period. Our existing significant tax holiday in Malaysia will expire on December 31, 2026, while our tax holiday in China will expire on December 31, 2023. For additional information on these tax holidays, refer to Note 11. Income Taxes to our Consolidated Financial Statements.

Earnings from Continuing Operations

Earnings from continuing operations for the third quarter of 2022 was $2.7 million, compared with earnings of $27.7 million for the third quarter of 2021, a decrease of $25.0 million. As described above, the decrease is primarily due to lower gross profit, partially offset by an income tax benefit, lower operating expenses, and reduced interest costs.

(Loss) Earnings and Adjusted Earnings from Continuing Operations Before Interest and Income Taxes

Loss before interest and income taxes from continuing operations for the third quarter of 2022 was $12.5 million, compared with earnings of $36.5 million for the third quarter of 2021, a decrease of $49.0 million. The decrease is primarily due to lower gross profit, partially offset by lower operating expenses.

Adjusted earnings before interest and income taxes ("Adjusted EBIT") for the third quarter of 2022 was $28.2 million, compared with earnings of $52.6 million for the third quarter of 2021, a decrease of $24.4 million. Adjusted EBIT margin (Adjusted EBIT as a percentage of revenues) for the third quarter of 2022 was 15.8%, compared with 22.6% for the third quarter of 2021. The decreases were primarily due to lower non-GAAP gross profit, partially offset by lower non-GAAP operating expenses.

27

Diluted Earnings per Share from Continuing Operations and Non-GAAP Diluted Earnings per Share

Diluted earnings per share from continuing operations was $0.03 for the third quarter of 2022, compared with earnings of $0.29 for the third quarter of 2021, a decrease of $0.26. As described above, the decrease is primarily due to lower gross profit, partially offset by an income tax benefit, lower operating expenses, and reduced interest costs.

Non-GAAP diluted earnings per share was $0.25 for the third quarter of 2022, compared with earnings of $0.45 for the third quarter of 2021, a decrease of $0.20. As described above, the decrease was primarily due to lower non-GAAP gross profit, partially offset by lower non-GAAP operating expenses.

Results of Operations for the Nine Months Ended September 30, 2022 compared with the Nine Months Ended September 30, 2021

	Nine Months Ended September 30,
(in millions, except per share amounts)	2022		2021
Revenues	$	567.6	$	633.8
Gross profit	$	201.0	$	258.6
Non-GAAP gross profit	$	230.5	$	260.7
(Loss) earnings from continuing operations before interest and income taxes	$	(207.0)	$	78.6
Adjusted earnings from continuing operations before interest and income taxes	$	105.2	$	122.7
Provision for income taxes	$	12.4	$	8.7
Non-GAAP provision for income taxes	$	13.9	$	15.5
(Loss) earnings from continuing operations	$	(222.1)	$	57.6
Non-GAAP net earnings	$	88.6	$	100.9
Diluted (loss) earnings per share from continuing operations	$	(2.42)	$	0.61
Non-GAAP diluted earnings per share	$	0.93	$	1.05

Revenues

Revenues for the nine months ended September 30, 2022 were $567.6 million, compared with $633.8 million for the nine months ended September 30, 2021, a decrease of $66.2 million or 10.4%. Audio revenues decreased $102.6 million, primarily due to lower demand for MEMS microphones in the mobile, computing, and IoT markets. The decreases in these markets were primarily driven by weak global demand for consumer electronics, COVID-19 related shutdowns in China, excess inventory in the supply chain, and our shift away from commoditized products. The lower demand for MEMS microphones was partially offset by share gains and market growth in the hearing health market. Audio revenues were also impacted by lower average pricing on mature products. PD revenues increased $36.4 million, primarily due to our organic growth from the defense, industrial, medtech, and communications markets, along with our acquisition of IMC.

Cost of Goods Sold

COGS for the nine months ended September 30, 2022 was $338.5 million, compared with $375.2 million for the nine months ended September 30, 2021, a decrease of $36.7 million or 9.8%. This decrease was primarily due to lower shipping volumes, product cost reductions, favorable mix, and favorable foreign currency exchange rate changes, partially offset by lower factory capacity utilization in our MEMS microphone business.

28

Restructuring Charges

During the first and third quarters of 2022, we committed to restructuring programs within our Audio segment designed to rightsize manufacturing capacity and operating expenses in the MEMS microphones product line. These actions were taken in light of the current decline in demand and the reduction in the expected future growth for global consumer electronics. In addition, these restructuring programs further the Company's previously announced strategy to reduce exposure to commodity microphones and increase emphasis on high-value solutions. These actions resulted in the settlement of supplier obligations, non-cash fixed asset write-offs, and severance pay. We recorded restructuring charges of $35.1 million related to these actions and $0.6 million for other costs. We may incur additional restructuring charges of up to $9.4 million during the remainder of the fiscal year for certain fixed assets of the terminated projects, which cannot be reasonably estimated at this time due to the complex nature of the assets under review for use in other projects. In addition, we recorded restructuring charges of $2.2 million to rationalize the Intelligent Audio product line workforce, which is also included within the Audio segment. As a result, we recorded total restructuring charges of $28.1 million within Gross Profit and $9.8 million within Operating expenses. For additional information, refer to Note 8. Restructuring and Related Activities to our Consolidated Financial Statements.

During the nine months ended September 30, 2021, we recorded restructuring charges of $0.3 million within Operating expenses related to a reduction in workforce. No restructuring charges were recorded within Gross profit for the nine months ended September 30, 2021.

Gross Profit and Non-GAAP Gross Profit

Gross profit for the nine months ended September 30, 2022 was $201.0 million, compared with $258.6 million for the nine months ended September 30, 2021, a decrease of $57.6 million or 22.3%. Gross profit margin for the nine months ended September 30, 2022 was 35.4%, compared with 40.8% for the nine months ended September 30, 2021. The decreases were primarily due to restructuring charges, lower shipping volumes, lower factory capacity utilization in our MEMS microphone business, lower average pricing on mature products, partially offset by product cost reductions, favorable mix, and favorable foreign currency exchange rate changes.

Non-GAAP gross profit for the nine months ended September 30, 2022 was $230.5 million, compared with $260.7 million for the nine months ended September 30, 2021, a decrease of $30.2 million or 11.6%. Non-GAAP gross profit margin for the nine months ended September 30, 2022 was 40.6%, compared with 41.1% for the nine months ended September 30, 2021. The decreases were primarily due to lower shipping volumes, lower factory capacity utilization in our MEMS microphone business, lower average pricing on mature products, partially offset by product cost reductions, favorable mix, and favorable foreign currency exchange rate changes.

Research and Development Expenses

Research and development expenses for the nine months ended September 30, 2022 were $63.7 million, compared with $70.2 million for the nine months ended September 30, 2021, a decrease of $6.5 million or 9.3%. Research and development expenses as a percentage of revenues for the nine months ended September 30, 2022 and 2021 were 11.2% and 11.1%, respectively. The decrease in expenses was primarily driven by reduced spending in our MEMS microphones product line, reduced development activities in our Intelligent Audio product line, and lower incentive compensation costs, partially offset by increased development activities in our precision devices product line. Expenses as a percentage of revenues remained consistent.

Selling and Administrative Expenses

Selling and administrative expenses for the nine months ended September 30, 2022 were $95.6 million, compared with $108.9 million for the nine months ended September 30, 2021, a decrease of $13.3 million or 12.2%. Selling and administrative expenses as a percentage of revenues for the nine months ended September 30, 2022 and 2021 were 16.8% and 17.2%, respectively. The decreases were primarily driven by lower incentive compensation costs, stock-based compensation, a reduction of our deferred compensation liability, and lower legal expenses related to the protection of our intellectual property. For additional information on stock-based compensation, refer to Note 12. Equity Incentive Program to our Consolidated Financial Statements. These decreases were partially offset by the normal operational expenses related to our IMC acquisition.

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Impairment Charges

Impairment charges for the nine months ended September 30, 2022 were $239.8 million, related to a goodwill impairment charge for the MCE reporting unit. The impairment charges for the nine months ended September 30, 2021 were $4.0 million, related to facilities in our Intelligent Audio product line. For additional information related to these impairment charges, refer to Note 4. Impairment Charges to our Consolidated Financial Statements.

Interest Expense, net

Interest expense for the nine months ended September 30, 2022 was $2.7 million, compared to $12.3 million for the nine months ended September 30, 2021, a decrease of $9.6 million. The decrease was primarily due to lower outstanding borrowings. For additional information on borrowings and interest expense, refer to Note 9. Borrowings to our Consolidated Financial Statements.

Other Income, net

Other income for the nine months ended September 30, 2022 was $0.9 million, compared with income of $3.4 million for the nine months ended September 30, 2021, a change of $2.5 million. The change is primarily due to an adjustment to pre-spin-off pension obligations and the depreciation in our investment balances, partially offset by favorable impacts from foreign currency exchange rate changes.

Provision for Income Taxes and Non-GAAP Provision for Income Taxes

The ETR from continuing operations for the nine months ended September 30, 2022 and 2021 was (5.9)% (inclusive of discrete items totaling $1.6 million of benefit primarily related to the stock-based compensation deduction) and a 13.1% provision (inclusive of discrete items totaling $0.9 million of benefit), respectively. Absent the discrete items, the ETR from continuing operations for the nine months ended September 30, 2022 and 2021 was (6.7)% and a 14.5% provision, respectively. The provision for the nine months ended September 30, 2022 is the result of estimated tax expense for the year in relation to the estimated pre-tax loss for the year, which when applied to the pre-tax loss results in tax expense. The Company accrues taxes in various countries where it generates income and applies a valuation allowance in other jurisdictions, which resulted in the provision for both the nine months ended September 30, 2022 and 2021. The change in the ETR from continuing operations was mainly due to the book goodwill impairment recorded in the second quarter of 2022, as well as the mix of earnings and losses by taxing jurisdictions and net discrete items.

The non-GAAP ETR from continuing operations for the nine months ended September 30, 2022 was a 13.6% provision, compared with a 13.3% provision for the nine months ended September 30, 2021. The non-GAAP ETR from continuing operations for the nine months ended September 30, 2022 was impacted by a net discrete benefit totaling $0.4 million. The non-GAAP ETR from continuing operations for the nine months ended September 30, 2021 was impacted by a net discrete benefit totaling $0.6 million. Absent the discrete items, the non-GAAP ETR from continuing operations for the nine months ended September 30, 2022 was a 14.0% provision, compared to a 13.8% provision for the nine months ended September 30, 2021.

The ETR and non-GAAP ETR deviate from the statutory U.S. federal income tax rate, mainly due to the taxing jurisdictions where we generate taxable income or loss as well as the favorable impact of our tax holidays in Malaysia and China. A significant portion of our pre-tax income is subject to a lower tax rate as a result of our Malaysian and Chinese tax holidays, subject to our annual satisfaction of certain conditions we expect to continue to satisfy through the holiday period. Our existing significant tax holiday in Malaysia will expire on December 31, 2026, while our tax holiday in China will expire on December 31, 2023. For additional information on these tax holidays, refer to Note 11. Income Taxes to our Consolidated Financial Statements.

(Loss) Earnings from Continuing Operations

Loss from continuing operations for the nine months ended September 30, 2022 was $222.1 million, compared with earnings of $57.6 million for the nine months ended September 30, 2021, a decrease of $279.7 million. As described above, the decrease is primarily due to increased impairment charges and lower gross profit.

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(Loss) Earnings and Adjusted Earnings from Continuing Operations Before Interest and Income Taxes

Loss before interest and income taxes from continuing operations for the nine months ended September 30, 2022 was $207.0 million, compared with earnings of $78.6 million for the nine months ended September 30, 2021, a decrease of $285.6 million. The decrease was primarily due to increased impairment charges and lower gross profit.

Adjusted EBIT for the nine months ended September 30, 2022 was $105.2 million, compared with $122.7 million for the nine months ended September 30, 2021, a decrease of $17.5 million. Adjusted EBIT margin for the nine months ended September 30, 2022 was 18.5%, compared with 19.4% for the nine months ended September 30, 2021. The decrease in Adjusted EBIT and Adjusted EBIT margin was primarily due to lower non-GAAP gross profit, partially offset by lower non-GAAP operating expenses.

Earnings from Discontinued Operations, net

There was no activity during 2022. We recorded a tax benefit of $0.2 million during 2021, related to the Speaker and Receiver product line.

Diluted (Loss) Earnings per Share from Continuing Operations and Non-GAAP Diluted Earnings per Share

Diluted loss per share from continuing operations was $2.42 for the nine months ended September 30, 2022, compared with earnings of $0.61 for the nine months ended September 30, 2021, a decrease of $3.03. As described above, the decrease was primarily due to increased impairment charges and lower gross profit.

Non-GAAP diluted earnings per share from continuing operations was $0.93 for the nine months ended September 30, 2022, compared with earnings of $1.05 for the nine months ended September 30, 2021, a decrease of $0.12. As described above, the increase was primarily due to lower non-GAAP gross profit, partially offset by lower non-GAAP operating expenses.

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Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures (1)

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in millions, except per share amounts)	2022		2021		2022		2021
Gross profit	$	40.0	$	96.9	$	201.0	$	258.6
Stock-based compensation expense	0.5		0.3		1.4		1.1
Restructuring charges	28.1		—		28.1		—
Other (2)	—		0.3		—		1.0
Non-GAAP gross profit	$	68.6	$	97.5	$	230.5	$	260.7
Earnings (loss) from continuing operations	$	2.7	$	27.7	$	(222.1)	$	57.6
Interest expense, net	1.1		4.2		2.7		12.3
(Benefit from) provision for income taxes	(16.3)		4.6		12.4		8.7
(Loss) earnings from continuing operations before interest and income taxes	(12.5)		36.5		(207.0)		78.6
Stock-based compensation expense	6.8		7.1		21.6		25.6
Intangibles amortization expense	3.1		4.3		9.2		11.5
Impairment charges	—		4.0		239.8		4.0
Restructuring charges	30.8		—		37.9		0.3
Other (2)	—		0.7		3.7		2.7
Adjusted earnings from continuing operations before interest and income taxes	$	28.2	$	52.6	$	105.2	$	122.7
Interest expense, net	$	1.1	$	4.2	$	2.7	$	12.3
Interest expense, net non-GAAP reconciling adjustments (3)	—		2.1		—		6.0
Non-GAAP interest expense	$	1.1	$	2.1	$	2.7	$	6.3
(Benefit from) provision for income taxes	$	(16.3)	$	4.6	$	12.4	$	8.7
Income tax effects of non-GAAP reconciling adjustments (4)	20.1		2.9		1.5		6.8
Non-GAAP provision for income taxes	$	3.8	$	7.5	$	13.9	$	15.5
Earnings (loss) from continuing operations	$	2.7	$	27.7	$	(222.1)	$	57.6
Non-GAAP reconciling adjustments (5)	40.7		16.1		312.2		44.1
Interest expense, net non-GAAP reconciling adjustments (3)	—		2.1		—		6.0
Income tax effects of non-GAAP reconciling adjustments (4)	20.1		2.9		1.5		6.8
Non-GAAP net earnings	$	23.3	$	43.0	$	88.6	$	100.9
Diluted earnings (loss) per share from continuing operations	$	0.03	$	0.29	$	(2.42)	$	0.61
Earnings per share non-GAAP reconciling adjustment	0.22		0.16		3.35		0.44
Non-GAAP diluted earnings per share	$	0.25	$	0.45	$	0.93	$	1.05
Diluted average shares outstanding	92.0		94.1		91.9		94.8
Non-GAAP adjustment (6)	2.2		1.3		3.2		0.9
Non-GAAP diluted average shares outstanding (6)	94.2		95.4		95.1		95.7

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(1) In addition to the GAAP financial measures included herein, Knowles has presented certain non-GAAP financial measures that exclude certain amounts that are included in the most directly comparable GAAP measures. Knowles believes that non-GAAP measures are useful as supplements to its GAAP results of operations to evaluate certain aspects of its operations and financial performance, and its management team primarily focuses on non-GAAP items in evaluating Knowles' performance for business planning purposes. Knowles also believes that these measures assist it with comparing its performance between various reporting periods on a consistent basis, as these measures remove from operating results the impact of items that, in Knowles' opinion, do not reflect its core operating performance. Knowles believes that its presentation of non-GAAP financial measures is useful because it provides investors and securities analysts with the same information that Knowles uses internally for purposes of assessing its core operating performance.

(2)    In 2022, Other expenses represent an adjustment to pre-spin-off pension obligations of $3.4 million, which was recorded during the second quarter of 2022 in Other income, net line on the Consolidated Statements of Earnings, and the ongoing net lease cost related to facilities not used in operations. In 2021, Other expenses represent the ongoing net lease cost related to facilities not used in operations and expenses related to the acquisition of IMC by the PD segment.

(3)    Under GAAP in effect for the Company through 2021, certain convertible debt instruments that may be settled in cash (or other assets) upon conversion were required to be separately accounted for as liability (debt) and equity (conversion option) components of the instrument in a manner that reflected the issuer’s nonconvertible debt borrowing rate. Accordingly, for GAAP purposes we were required to recognize imputed interest expense on the Company’s $172.5 million of convertible senior notes due November 1, 2021 that were issued in a private placement in May 2016. The imputed interest rate for the convertible notes was 8.12%, while the actual coupon interest rate of the notes was 3.25%. The difference between the imputed interest expense and the coupon interest expense was excluded from management’s assessment of the Company’s operating performance because management believes that this non-cash expense was not indicative of its core, ongoing operating performance.

(4)    Income tax effects of non-GAAP reconciling adjustments are calculated using the applicable tax rates in the jurisdictions of the underlying adjustments.

(5)    The non-GAAP reconciling adjustments are those adjustments made to reconcile (Loss) earnings from continuing operations before interest and income taxes to Adjusted earnings from continuing operations before interest and income taxes.

(6)    The number of shares used in the diluted per share calculations on a non-GAAP basis excludes the impact of stock-based compensation expense expected to be incurred in future periods and not yet recognized in the financial statements, which would otherwise be assumed to be used to repurchase shares under the GAAP treasury stock method. In addition, the Company entered into convertible note hedge transactions that expired upon maturity of the convertible notes to offset any potential dilution from the convertible notes. Although the anti-dilutive impact of the convertible note hedges was not reflected under GAAP, the Company included the anti-dilutive impact of the convertible note hedges in non-GAAP diluted average shares outstanding, if applicable.

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Segment Results of Operations for the Three Months Ended September 30, 2022 compared with the Three Months Ended September 30, 2021

The following is a summary of the results of operations of our two reportable segments: Audio and Precision Devices.

See Note 15. Segment Information to the Consolidated Financial Statements for (i) a reconciliation of segment revenues to our consolidated revenues and (ii) a reconciliation of segment (loss) earnings from continuing operations before interest and income taxes to our consolidated (loss) earnings from continuing operations.

Audio

	Three Months Ended September 30,
(in millions)	2022		Percent of Revenues	2021		Percent of Revenues
Revenues	$	113.8		$	177.7
(Loss) earnings from continuing operations before interest and income taxes	$	(16.9)	(14.9)%	$	36.6	20.6%
Stock-based compensation expense	2.0			2.1
Intangibles amortization expense	1.6			2.7
Impairment charges	—			4.0
Restructuring charges	30.7			—
Other (1)	—			0.3
Adjusted earnings from continuing operations before interest and income taxes	$	17.4	15.3%	$	45.7	25.7%
(1) Other represents the ongoing net lease cost related to facilities not used in operations.

Revenues

Revenues were $113.8 million for the third quarter of 2022, compared with $177.7 million for the third quarter of 2021, a decrease of $63.9 million or 36.0%. Revenues decreased primarily due to lower demand for MEMS microphones in the mobile, computing, and IoT markets. The decreases in these markets were primarily driven by weak global demand for consumer electronics, COVID-19 related shutdowns in China, excess inventory in the supply chain, and our shift away from commoditized products. In addition, the hearing health market demand was lower primarily due to pull forward of demand from our customers into the first six months of the year. Audio revenues were also impacted by lower average pricing on mature products.

(Loss) Earnings and Adjusted Earnings from Continuing Operations Before Interest and Income Taxes

Audio loss before interest and income taxes from continuing operations was $16.9 million for the third quarter of 2022, compared with earnings of $36.6 million for the third quarter of 2021, a decrease of $53.5 million. The decrease was primarily due to the restructuring charges, lower revenues, and lower gross profit margin, partially offset by a reduction in operating expenses, impairment charges, and amortization expense. The lower gross profit margin was driven by restructuring charges, lower factory capacity utilization in our MEMS microphone business and lower average pricing on mature products, partially offset by favorable foreign currency exchange rate changes.

Audio Adjusted EBIT was $17.4 million for the third quarter of 2022, compared with $45.7 million for the third quarter of 2021, a decrease of $28.3 million. Adjusted EBIT margin for the third quarter of 2022 was 15.3%, compared to 25.7% for the third quarter of 2021. The decreases were primarily due to lower revenues and lower non-GAAP gross profit margin, partially offset by lower non-GAAP operating expenses. The lower non-GAAP gross profit margin was driven by lower factory capacity utilization in our MEMS microphone business and lower average pricing on mature products, partially offset by favorable foreign currency exchange rate changes.

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Precision Devices

	Three Months Ended September 30,
(in millions)	2022		Percent of Revenues	2021		Percent of Revenues
Revenues	$	64.4		$	55.3
Earnings from continuing operations before interest and income taxes	$	16.2	25.2%	$	14.0	25.3%
Stock-based compensation expense	0.6			0.7
Intangibles amortization expense	1.5			1.6
Other (1)	—			0.3
Adjusted earnings from continuing operations before interest and income taxes	$	18.3	28.4%	$	16.6	30.0%
(1) 2021 expenses relate to the acquisition of IMC.

Revenues

Revenues were $64.4 million for the third quarter of 2022, compared with $55.3 million for the third quarter of 2021, an increase of $9.1 million or 16.5%. Revenues increased due to growth from the defense, medtech, and electric vehicle markets.

Earnings and Adjusted Earnings from Continuing Operations Before Interest and Income Taxes

PD Earnings before interest and income taxes ("EBIT") from continuing operations was $16.2 million for the third quarter of 2022, compared with earnings of $14.0 million for the third quarter of 2021, an increase of $2.2 million. EBIT margin for the third quarter of 2022 was 25.2%, compared to 25.3% for the third quarter of 2021. The EBIT increase was primarily due to higher revenues, partially offset by an increase in operating expenses. The EBIT margin remained consistent with the previous period.

PD Adjusted EBIT was $18.3 million for the third quarter of 2022, compared with $16.6 million for the third quarter of 2021, an increase of $1.7 million. Adjusted EBIT margin for the third quarter of 2022 was 28.4%, compared with 30.0% for the third quarter of 2021. The Adjusted EBIT increase was primarily due to higher revenues, partially offset by an increase in non-GAAP operating expenses. The Adjusted EBIT margin decreased from the previous period driven by higher non-GAAP operating expenses, partially offset by higher non-GAAP gross profit margins.

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Segment Results of Operations for the Nine Months Ended September 30, 2022 compared with the Nine Months Ended September 30, 2021

Audio

	Nine Months Ended September 30,
(in millions)	2022		Percent of Revenues	2021		Percent of Revenues
Revenues	$	388.0		$	490.6
(Loss) earnings from continuing operations before interest and income taxes	$	(210.9)	(54.4)%	$	95.0	19.4%
Stock-based compensation expense	6.9			7.8
Intangibles amortization expense	4.8			8.1
Impairment charges	239.8			4.0
Restructuring charges	37.3			0.3
Other (1)	0.3			1.2
Adjusted earnings from continuing operations before interest and income taxes	$	78.2	20.2%	$	116.4	23.7%
(1) Other represents the ongoing net lease cost related to facilities not used in operations.

Revenues

Revenues were $388.0 million for the nine months ended September 30, 2022, compared with $490.6 million for the nine months ended September 30, 2021, a decrease of $102.6 million or 20.9%. Revenues decreased primarily due to lower demand for MEMS microphones in the mobile, computing, and IoT markets. The decreases in these markets were primarily driven by weak global demand for consumer electronics, COVID-19 related shutdowns in China, excess inventory in the supply chain, and our shift away from commoditized products. The lower demand for MEMS microphones was partially offset by share gains and market growth in the hearing health market. Audio revenues were also impacted by lower average pricing on mature products.

(Loss) Earnings and Adjusted Earnings from Continuing Operations Before Interest and Income Taxes

Audio loss before interest and income taxes from continuing operations was $210.9 million for the nine months ended September 30, 2022, compared with earnings of $95.0 million for the nine months ended September 30, 2021, a decrease of $305.9 million. The decrease was primarily due to higher impairment charges, lower revenues, increased restructuring charges, and lower gross profit margin, partially offset by lower operating expenses, reduced amortization expense, and a reduction in legal expenses. The lower gross profit margin was driven by increased restructuring charges, lower factory capacity utilization in our MEMS microphone business, lower average pricing on mature products, partially offset by product cost reductions and favorable foreign currency exchange rate changes.

Audio Adjusted EBIT from continuing operations was $78.2 million for the nine months ended September 30, 2022, compared with earnings of $116.4 million for the nine months ended September 30, 2021, a decrease of $38.2 million. Adjusted earnings before interest and income taxes from continuing operations margin for the nine months ended September 30, 2022 was 20.2%, compared to 23.7% for the nine months ended September 30, 2021. The decreases were primarily due to lower revenues and lower non-GAAP gross profit margin, partially offset by lower non-GAAP operating expenses and a reduction in legal expenses. The lower non-GAAP gross profit margin was driven by lower factory capacity utilization in our MEMS microphone business, lower average pricing on mature products, partially offset by product cost reductions and favorable foreign currency exchange rate changes.

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Precision Devices

	Nine Months Ended September 30,
(in millions)	2022		Percent of Revenues	2021		Percent of Revenues
Revenues	$	179.6		$	143.2
Earnings from continuing operations before interest and income taxes	$	39.5	22.0%	$	28.3	19.8%
Stock-based compensation expense	2.0			2.1
Intangibles amortization expense	4.4			3.4
Other (1)	3.4			1.0
Adjusted earnings from continuing operations before interest and income taxes	$	49.3	27.4%	$	34.8	24.3%
(1) 2022 expenses represent an adjustment to pre-spin-off pension obligations. 2021 expenses relate to the acquisition of IMC.

Revenues

Revenues were $179.6 million for the nine months ended September 30, 2022, compared with $143.2 million for the nine months ended September 30, 2021, an increase of $36.4 million or 25.4%. Revenues increased primarily due to our organic growth from the defense, industrial, medtech, and communications markets, along with our acquisition of IMC.

Earnings and Adjusted Earnings from Continuing Operations Before Interest and Income Taxes

PD EBIT was $39.5 million for the nine months ended September 30, 2022, compared with $28.3 million for the nine months ended September 30, 2021, an increase of $11.2 million. EBIT margin for the nine months ended September 30, 2022 was 22.0%, compared to 19.8% for the nine months ended September 30, 2021. The increases were primarily due to higher revenues and higher gross profit margins, partially offset by an increase in operating expenses and an adjustment to pre-spin-off pension obligations. The gross profit margin increase was primarily driven by product cost reductions.

PD Adjusted EBIT was $49.3 million for the nine months ended September 30, 2022, compared with $34.8 million for the nine months ended September 30, 2021, an increase of $14.5 million. Adjusted EBIT margin for the nine months ended September 30, 2022 was 27.4%, compared with 24.3% for the nine months ended September 30, 2021. The increases were primarily due to higher revenues and higher non-GAAP gross profit margins, partially offset by an increase in non-GAAP operating expenses. The non-GAAP gross profit margin increase was primarily driven by product cost reductions.

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Liquidity and Capital Resources

Historically, we have generated and expect to continue to generate positive cash flow from operations. Our ability to fund our operations and capital needs will depend on our ongoing ability to generate cash from operations and access to capital markets. We believe that our future cash flow from operations and access to capital markets will provide adequate resources to fund our working capital needs, capital expenditures, strategic investments, and share repurchases. We have secured a revolving line of credit in the United States from a syndicate of commercial banks to provide additional liquidity. Furthermore, if we were to require additional cash above and beyond our cash on the balance sheet, the free cash flow generated by the business, and availability under our revolving credit facility, we would most likely seek to raise long-term financing through the U.S. debt or bank markets.

Due to the global nature of our operations, a significant portion of our cash is generated and typically held outside the United States. Our cash and cash equivalents totaled $41.5 million and $68.9 million at September 30, 2022 and December 31, 2021, respectively. Of these amounts, cash held by our non-U.S. operations totaled $34.3 million and $64.9 million as of September 30, 2022 and December 31, 2021, respectively. To the extent we repatriate these funds to the U.S., we may be required to pay U.S. state income taxes and applicable foreign withholding taxes on those amounts during the period when such repatriation occurs. Management will continue to reassess our need to repatriate the earnings of our foreign subsidiaries.

On May 3, 2021, we acquired all of the outstanding shares of common stock of IMC for $81.4 million. The acquired business provides RF filters to the defense, industrial, and communications markets. The acquisition's operations are included in the PD segment. For additional information, refer to Note 3. Acquisition to our Consolidated Financial Statements.

On September 4, 2020, we entered into a new Credit Agreement (the "New Credit Agreement"), which provides for a senior secured revolving credit facility (the "New Credit Facility") with borrowings in an aggregate principal amount at any time outstanding not to exceed $400.0 million. As of September 30, 2022, outstanding borrowings under the New Credit Facility were $78.0 million. At any time during the term of the New Credit Facility, we will be permitted to increase the commitments under the New Credit Facility or to establish one or more incremental term loan facilities under the New Credit Facility in an aggregate principal amount not to exceed $200.0 million for all such incremental facilities. Commitments under the New Credit Facility will terminate, and loans outstanding thereunder will mature, on January 2, 2024. For additional information, refer to Note 9. Borrowings to our Consolidated Financial Statements.

On February 24, 2020, we announced that our Board of Directors had authorized a share repurchase program of up to $100 million of our common stock. On April 28, 2022, we announced that our Board of Directors had increased the authorization by up to $150 million in additional aggregate value. The timing and amount of any shares repurchased will be determined by us based on our evaluation of market conditions and other factors, and will be made in accordance with applicable securities laws in either the open market or in privately negotiated transactions. We are not obligated to purchase any shares under the program, and the program may be suspended or discontinued at any time. The actual timing, number, and share price of shares repurchased will depend on a number of factors, including the market price of our common stock, general market and economic conditions, and applicable legal requirements. Any shares repurchased will be held as treasury stock. During the nine months ended September 30, 2022 and 2021, we repurchased 2,339,045 shares and 1,011,124 shares of common stock, respectively, for a total of $44.0 million and $20.0 million, respectively.

Cash flows from operating, investing, and financing activities as reflected in our Consolidated Statements of Cash Flows are summarized in the following table:

	Nine Months Ended September 30,
(in millions)	2022		2021
Net cash flows provided by (used in):
Operating activities	$	39.5	$	116.6
Investing activities	(25.4)		(109.4)
Financing activities	(40.1)		(14.9)
Effect of exchange rate changes on cash and cash equivalents	(1.4)		(0.1)
Net decrease in cash and cash equivalents	$	(27.4)	$	(7.8)

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Operating Activities

Cash provided by operating activities adjusts net earnings for certain non-cash items, including impairment charges, depreciation expense, amortization of intangible assets, stock-based compensation, restructuring charges, changes in deferred income taxes, and the effects of changes in operating assets and liabilities. The decrease in cash provided by operating activities for 2022 as compared to 2021 was primarily due to the unfavorable changes in working capital. The unfavorable changes in working capital in 2022 were primarily driven by an increase in procurement activity to mitigate supply chain risks and the timing of vendor payments. In addition, incentive compensation payments were larger in 2022 when compared to 2021.

Investing Activities

The cash used in investing activities during 2022 was primarily driven by capital expenditures to support product innovation and cost savings. The cash used in investing activities during 2021 was primarily driven by the acquisition of IMC and capital expenditures to support product innovation and cost savings.

In 2022, we expect capital expenditures to be in the range of 4% to 5% of revenues.

Financing Activities

Cash used in financing activities during 2022 was primarily related to the $44.0 million of repurchases of common stock and the $6.3 million payment of taxes related to net share settlement of equity awards, partially offset by net borrowings of $8.0 million under our revolving credit facility and proceeds of $6.4 million from the exercise of options. Cash used in financing activities during 2021 was primarily related to the $20.0 million of repurchases of common stock and the $7.6 million payment of taxes related to net share settlement of equity awards, partially offset by proceeds of $14.4 million from the exercise of options.

Contingent Obligations

We are involved in various legal proceedings, claims, and investigations arising in the ordinary course of business. Legal contingencies are discussed in Note 14. Commitments and Contingent Liabilities to our Consolidated Financial Statements.

Critical Accounting Estimates

This discussion and analysis of results of operations and financial condition is based on our Consolidated Financial Statements, which have been prepared in conformity with U.S. GAAP. The preparation of these financial statements requires the use of estimates and assumptions related to the reporting of assets, liabilities, revenues, expenses, and related disclosures. In preparing these financial statements, we have made our best estimates and judgments of certain amounts included in the financial statements. Estimates are revised periodically. Actual results could differ from these estimates.

The information concerning our critical accounting estimates can be found under Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and Exchange Commission on February 9, 2022. There are no material changes in our previously reported critical accounting estimates, except for the goodwill impairment charge for the MCE reporting unit described in Note 4. Impairment Charges to our Consolidated Financial Statements.

Recent Accounting Standards

The adoption of recent accounting standards, as included in Note 2. Recent Accounting Standards to our Consolidated Financial Statements, has not had and is not expected to have a significant impact on our revenue, earnings, or liquidity.

39

Item 3. Quantitative and Qualitative Disclosures About Market Risk

During the nine months ended September 30, 2022, there were no material changes to the information on market risk exposure disclosed in our Annual Report on Form 10-K for the year ended December 31, 2021. For a discussion of our exposure to market risk as of December 31, 2021, refer to Item 7A, Quantitative and Qualitative Disclosures about Market Risk, contained in our Annual Report on Form 10-K for the year ended December 31, 2021.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management has evaluated, under the supervision and with the participation of our chief executive officer ("CEO") and chief financial officer ("CFO"), the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this report. Based on that evaluation, our CEO and CFO have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures are effective in ensuring that information required to be disclosed in our Exchange Act reports is (1) recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and (2) accumulated and communicated to our management, including our CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting that occurred during the third quarter of 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

Our management, including the CEO and CFO, do not expect that our disclosure controls or our internal control over financial reporting will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, will be detected. These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by intentionally falsified documentation, by collusion of two or more individuals within Knowles or third parties, or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

For a discussion of contingencies related to legal proceedings, see Note 14. Commitments and Contingent Liabilities to our Consolidated Financial Statements, which is incorporated herein by reference.

Except as otherwise noted above, there have been no material developments in legal proceedings.

Item 1A. Risk Factors

There have been no material changes from the risk factors previously disclosed under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021.

40

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

Issuer Purchases of Equity Securities

On February 24, 2020, the Company announced that its Board of Directors had authorized a share repurchase program of up to $100 million of the Company's common stock. On April 28, 2022, the Company announced that its Board of Directors had increased the authorization by up to $150 million in additional aggregate value. The timing and amount of any shares repurchased will be determined by the Company based on its evaluation of market conditions and other factors, and will be made in accordance with applicable securities laws in either the open market or in privately negotiated transactions. The Company is not obligated to purchase any shares under the program, and the program may be suspended or discontinued at any time. The actual timing, number, and share price of shares repurchased will depend on a number of factors, including the market price of the Company’s common stock, general market and economic conditions, and applicable legal requirements. Any shares repurchased will be held as treasury stock.

Below is a summary of share repurchases for the three months ended September 30, 2022:

(in millions, except share and per share amounts)
Period	Total Number of Shares Purchased	Average Price Paid per Share	Total Number of Shares Purchased as Part of Publicly Announced Program	Approximate Dollar Value of Shares That May Yet Be Purchased Under The Program
July 2022	399,630	$18.16	399,630	$	156.6
August 2022	689,920	$16.44	689,920	$	145.2
Total Activity	1,089,550	$17.07	1,089,550

Item 6. Exhibits

3.1	Fourth Amended and Restated By-Laws of Knowles Corporation, effective as of October 25, 2022 (incorporated by reference to Exhibit 3.1 of the Registrant's Current Report on Form 8-K filed on October 27, 2022 (SEC file No. 001-36102))
31.1	Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Joint Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	The following financial information from Knowles Corporation's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2022 formatted in Inline XBRL: (i) Consolidated Statements of Earnings (Unaudited) for the three and nine months ended September 30, 2022 and 2021, (ii) Consolidated Statements of Comprehensive Earnings (Unaudited) for the three and nine months ended September 30, 2022 and 2021, (iii) Consolidated Balance Sheets (Unaudited) as of September 30, 2022 and December 31, 2021, (iv) Consolidated Statements of Stockholders’ Equity (Unaudited) for the three and nine months ended September 30, 2022 and 2021, (v) Consolidated Statements of Cash Flows (Unaudited) for the nine months ended September 30, 2022 and 2021, and (vi) the Notes to the Consolidated Financial Statements (Unaudited) tagged as blocks of text and including detailed tags.
104	The cover page from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, formatted in Inline XBRL and contained in Exhibit 101.

41

Signatures

Pursuant to the requirements 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.

		KNOWLES CORPORATION
Date:	October 27, 2022	/s/ John S. Anderson
		John S. Anderson
		Senior Vice President & Chief Financial Officer
		(Principal Financial Officer)

42

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO RULE 13a-14(a) AND RULE 15d-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934

I, Jeffrey S. Niew, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Knowles 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 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 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: October 27, 2022

/s/ JEFFREY S. NIEW

Name: Jeffrey S. Niew

Title: President and Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO RULE 13a-14(a) AND RULE 15d-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934

I, John S. Anderson, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Knowles 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 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 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: October 27, 2022

/s/ JOHN S. ANDERSON

Name: John S. Anderson

Title: Senior Vice President & Chief Financial Officer

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

JOINT CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Knowles Corporation (the “Company”) on Form 10-Q for the quarter ended September 30, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Jeffrey S. Niew and John S. Anderson, the Principal Executive and Financial Officers of the Company, certify, pursuant to and for purposes of 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that:

(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.

/s/ JEFFREY S. NIEW
Name: Jeffrey S. Niew
Title: President and Chief Executive Officer
(Principal Executive Officer)
Date:	October 27, 2022
/s/ JOHN S. ANDERSON
Name: John S. Anderson
Title: Senior Vice President & Chief Financial Officer
(Principal Financial Officer)
Date:	October 27, 2022

XML

Cover - shares	9 Months Ended
	Sep. 30, 2022	Oct. 25, 2022
Cover [Abstract]
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	001-36102
Entity Registrant Name	Knowles Corporation
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	90-1002689
Entity Address, Address Line One	1151 Maplewood Drive,
Entity Address, City or Town	Itasca,
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60143
City Area Code	(630)
Local Phone Number	250-5100
Title of 12(b) Security	Common stock, $0.01 par value per share
Trading Symbol	KN
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		90,946,447
Document Type	10-Q
Entity Central Index Key	0001587523
Current Fiscal Year End Date	--12-31
Document Period End Date	Sep. 30, 2022
Document Fiscal Period Focus	Q3
Amendment Flag	false
Document Fiscal Year Focus	2022

XML

CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Statement [Abstract]
Revenues	$ 178.2	$ 233.0	$ 567.6	$ 633.8
Cost of goods sold	110.1	136.1	338.5	375.2
Gross profit	40.0	96.9	201.0	258.6
Research and development expenses	19.3	22.3	63.7	70.2
Selling and administrative expenses	32.6	36.0	95.6	108.9
Asset Impairment Charges	0.0	4.0	239.8	4.0
Restructuring charges	2.7	0.0	9.8	0.3
Operating expenses	54.6	62.3	408.9	183.4
Operating (loss) earnings	(14.6)	34.6	(207.9)	75.2
Interest expense, net	1.1	4.2	2.7	12.3
Other income, net	(2.1)	(1.9)	(0.9)	(3.4)
(Loss) earnings before income taxes and discontinued operations	(13.6)	32.3	(209.7)	66.3
(Benefit from) provision for income taxes	(16.3)	4.6	12.4	8.7
Earnings (loss) from continuing operations	2.7	27.7	(222.1)	57.6
Net earnings (loss)	$ 2.7	$ 27.7	$ (222.1)	$ 57.8
Earnings per share:
Earnings (loss) from continuing operations, per basic share	$ 0.03	$ 0.30	$ (2.42)	$ 0.62
Earnings (loss) from continuing operations, per diluted share	0.03	0.29	(2.42)	0.61
Earnings from discontinued operations, per basic share	0	0	0	0.01
Earnings from discontinued operations, per diluted share	0	0	0	0
Net earnings (loss) per share, basic	0.03	0.30	(2.42)	0.63
Net earnings (loss) per share, diluted	$ 0.03	$ 0.29	$ (2.42)	$ 0.61
Weighted-average common shares outstanding:
Basic (in shares)	91,400,000	92,200,000	91,900,000	92,300,000
Diluted (in shares)	92,000,000.0	94,100,000	91,900,000	94,800,000
Restructuring charges - cost of goods sold	$ 28.1	$ 0.0	$ 28.1	$ 0.0

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (Unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Statement of Comprehensive Income [Abstract]
Net earnings (loss)	$ 2.7	$ 27.7	$ (222.1)	$ 57.8
Foreign currency translation	(13.1)	(3.7)	(30.9)	(6.4)
Employee benefit plans:
Amortization or settlement of actuarial losses and prior service costs	(0.2)	0.1	(0.2)	0.7
Net change in employee benefit plans	(0.2)	0.1	(0.2)	0.7
Changes in fair value of cash flow hedges:
Unrealized net losses arising during period	(3.0)	(0.2)	(6.1)	(0.5)
Net losses (gains) reclassified into earnings	1.7	0.1	2.3	(1.4)
Total cash flow hedges	(1.3)	(0.1)	(3.8)	(1.9)
Other comprehensive loss, net of tax	(14.6)	(3.7)	(34.9)	(7.6)
Comprehensive (loss) earnings	$ (11.9)	$ 24.0	$ (257.0)	$ 50.2

XML

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 41.5	$ 68.9
Accounts Receivable, after Allowance for Credit Loss, Current	128.7	146.6
Inventories, net	194.6	153.1
Prepaid and other current assets	12.4	11.7
Total current assets	377.2	380.3
Property, plant, and equipment, net	164.4	200.8
Goodwill	702.1	941.3
Intangible assets, net	88.1	97.3
Operating Lease, Right-of-Use Asset	13.6	17.4
Other assets and deferred charges	(91.3)	(94.5)
Total assets	1,436.7	1,731.6
Current liabilities:
Accounts payable	58.3	90.9
Accrued compensation and employee benefits	24.8	42.8
Operating Lease, Liability, Current	9.5	11.4
Other accrued expenses	27.5	19.4
Federal and other taxes on income	11.2	1.7
Total current liabilities	131.3	166.2
Long-term debt	78.0	70.0
Deferred Income Tax Liabilities, Net	0.5	0.6
Operating Lease, Liability, Noncurrent	8.4	14.7
Other liabilities	38.3	20.6
Commitments and contingencies (Note 14)
Stockholders' equity:
Preferred Stock, Value, Issued	0.0	0.0
Common Stock, Value, Issued	1.0	1.0
Treasury Stock, Value	(103.3)	(62.4)
Additional paid-in capital	1,658.0	1,639.4
Accumulated deficit	(240.2)	(18.1)
Accumulated other comprehensive loss	(135.3)	(100.4)
Total stockholders' equity	1,180.2	1,459.5
Total liabilities and stockholders' equity	$ 1,436.7	$ 1,731.6
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000
Preferred stock, shares issued (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01
Common stock, shares authorized (in shares)	400,000,000
Common stock, shares issued (in shares)	96,299,675	95,112,778
Common Stock, Shares, Outstanding	90,946,447	91,894,980
Treasury Stock, Shares	5,353,228	3,217,798

XML

CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Allowance for doubtful accounts receivable	$ 0.7	$ 0.2
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000
Preferred stock, shares issued (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01
Common stock, shares authorized (in shares)	400,000,000
Common stock, shares issued (in shares)	96,299,675	95,112,778
Treasury Stock, Shares	5,353,228	3,217,798

XML

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (unaudited) - USD ($) $ in Millions	Total	Common Stock	Treasury Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock, shares issued (in shares)		92,689,912
Treasury Stock, Shares			(1,078,363)
Balance at Dec. 31, 2020	$ 1,303.5	$ 0.9	$ (16.2)	$ 1,587.8	$ (168.5)	$ (100.5)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings (loss)	57.8
Stock Repurchased During Period, Value			(20.0)
Earnings (loss) from continuing operations	57.6
Other comprehensive loss, net of tax	(7.6)					(7.6)
Stock-based compensation expense	25.6			25.6
Stock Issued During Period, Shares, New Issues		867,386
Stock Issued During Period, Value, Stock Options Exercised	14.4	$ 0.0		14.4
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings		857,888
Balance at Sep. 30, 2021	1,366.1	$ 0.9	$ (36.2)	1,620.2	(110.7)	(108.1)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock Repurchased During Period, Shares			(1,011,124)
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent	(0.3)
Restricted Stock, Value, Shares Issued Net of Tax Withholdings	(7.6)			(7.6)
Common stock, shares issued (in shares)		94,075,885
Treasury Stock, Shares			(2,089,487)
Balance at Jun. 30, 2021	1,332.1	$ 0.9	$ (36.2)	1,610.2	(138.4)	(104.4)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings (loss)	27.7
Earnings (loss) from continuing operations	27.7
Other comprehensive loss, net of tax	(3.7)					(3.7)
Stock-based compensation expense	7.1			7.1
Stock Issued During Period, Shares, New Issues		218,342
Stock Issued During Period, Value, Stock Options Exercised	3.9	$ 0.0		3.9
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings		120,959
Balance at Sep. 30, 2021	1,366.1	$ 0.9	$ (36.2)	1,620.2	(110.7)	(108.1)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent	(0.1)
Restricted Stock, Value, Shares Issued Net of Tax Withholdings	(1.0)			(1.0)
Common stock, shares issued (in shares)		94,415,186
Treasury Stock, Shares			(2,089,487)
Balance at Dec. 31, 2021	1,459.5	$ 1.0	$ (62.4)	1,639.4	(18.1)	(100.4)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock Issued During Period, Shares, Conversion of Convertible Securities			400,000
Treasury Stock, Value	$ 62.4
Common stock, shares issued (in shares)	95,112,778	95,112,778
Treasury Stock, Shares	3,217,798		(3,217,798)
Net earnings (loss)	$ (222.1)
Stock Repurchased During Period, Value			$ (44.0)
Earnings (loss) from continuing operations	(222.1)				(222.1)
Other comprehensive loss, net of tax	(34.9)					(34.9)
Stock-based compensation expense	21.6			21.6
Stock Issued During Period, Shares, New Issues		529,199
Stock Issued During Period, Value, Stock Options Exercised	6.4	$ 0.0		6.4
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings		657,698
Balance at Sep. 30, 2022	1,180.2	$ 1.0	$ (103.3)	1,658.0	(240.2)	(135.3)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock Repurchased During Period, Shares			(2,339,045)
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent	0.4
Shares Issued During Period, Value, Exercise of Warrants	0.0		$ 3.1	3.1
Shares Issued During Period, Shares, Exercise of Warrants			203,615
Restricted Stock, Value, Shares Issued Net of Tax Withholdings	(6.3)			(6.3)
Common stock, shares issued (in shares)		96,254,641
Treasury Stock, Shares			(4,263,678)
Balance at Jun. 30, 2022	1,203.6	$ 1.0	$ (84.7)	1,650.9	(242.9)	(120.7)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings (loss)	2.7
Stock Repurchased During Period, Value			(18.6)
Earnings (loss) from continuing operations	2.7				2.7
Other comprehensive loss, net of tax	(14.6)					(14.6)
Stock-based compensation expense	6.8			6.8
Stock Issued During Period, Shares, New Issues		29,672
Stock Issued During Period, Value, Stock Options Exercised	0.4	$ 0.0		0.4
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings		15,362
Balance at Sep. 30, 2022	1,180.2	$ 1.0	$ (103.3)	1,658.0	$ (240.2)	$ (135.3)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock Repurchased During Period, Shares			(1,089,550)
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent	0.4
Restricted Stock, Value, Shares Issued Net of Tax Withholdings	(0.1)			$ (0.1)
Treasury Stock, Value	$ 103.3
Common stock, shares issued (in shares)	96,299,675	96,299,675
Treasury Stock, Shares	5,353,228		(5,353,228)

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Restructuring charges	$ 8.9	$ 0.0
Operating Activities
Net earnings (loss)	(222.1)	57.8
Adjustments to reconcile net (loss) earnings to cash from operating activities:
Depreciation and amortization	41.7	46.6
Stock-based compensation	21.6	25.6
Asset Impairment Charges	239.8	4.0
Non-cash interest expense and amortization of debt issuance costs	0.5	7.1
Gain (Loss) on Disposition of Property Plant Equipment	0.2	(0.2)
Deferred income taxes	(2.0)	(1.5)
Other, net	(7.4)	(2.5)
Changes in assets and liabilities (excluding effects of foreign exchange):
Receivables, net	16.8	4.6
Inventories, net	(50.3)	(24.0)
Prepaid and other current assets	(1.5)	(1.4)
Accounts payable	(24.6)	1.4
Accrued compensation and employee benefits	(16.7)	5.9
Other accrued expenses	5.8	2.4
Increase Decrease Accrued Taxes, Net	9.0	(3.0)
Other non-current assets and non-current liabilities	19.8	(6.2)
Net Cash Provided by (Used in) Operating Activities	39.5	116.6
Investing Activities
Net Cash Provided by (Used in) Investing Activities, Total	(25.4)	(109.4)
Acquisitions of business (net of cash acquired)	(0.7)	(78.5)
Capital expenditures	(24.7)	(28.2)
Payments for (Proceeds from) Investments	0.0	(3.5)
Proceeds from Sale of Short-term Investments	0.0	0.4
Proceeds from Sale of Property, Plant, and Equipment	0.0	0.4
Financing Activities
Net Cash Provided by (Used in) Financing Activities, Total	(40.1)	(14.9)
Repayments of Lines of Credit	(15.0)	0.0
Borrowings under revolving credit facility	23.0	0.0
Payments for Repurchase of Common Stock	44.0	20.0
Tax on restricted and performance stock unit vesting	(6.3)	(7.6)
Payments of finance lease obligations	(4.2)	(1.7)
Proceeds from exercise of stock options	6.4	14.4
Effect of Exchange Rate on Cash and Cash Equivalents [Abstract]
Effect of exchange rate changes on cash and cash equivalents	(1.4)	(0.1)
Net decrease in cash and cash equivalents	(27.4)	(7.8)
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Including Disposal Group and Discontinued Operations	41.5	140.0
Supplemental information - cash paid for:
Income taxes	3.9	12.3
Interest	$ 2.4	$ 4.0

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Basis of Presentation (Notes)

9 Months Ended

Sep. 30, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Business Description and Basis of Presentation

1. Basis of Presentation

Description of Business - Knowles Corporation (NYSE:KN) is a market leader and global provider of advanced micro-acoustic microphones and balanced armature speakers, audio solutions, and high performance capacitors and radio frequency ("RF") products, serving the consumer electronics, medtech, defense, electric vehicle, industrial, and communications markets. The Company uses its leading position in SiSonicTM micro-electro-mechanical systems ("MEMS") microphones and strong capabilities in audio processing technologies to optimize audio systems and improve the user experience across consumer applications. Knowles is also a leader in hearing health acoustics, high performance capacitors, and RF solutions for a diverse set of markets. The Company's focus on the customer, combined with its unique technology, proprietary manufacturing techniques, and global operational expertise, enable the Company to deliver innovative solutions across multiple applications. References to "Knowles," "the Company," "we," "our," and "us" refer to Knowles Corporation and its consolidated subsidiaries.

Financial Statement Presentation - The accompanying unaudited interim Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“GAAP” or “U.S. GAAP”) for complete financial statements. These unaudited interim Consolidated Financial Statements should therefore be read in conjunction with the Consolidated Financial Statements and Notes thereto for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K.

The accompanying unaudited interim Consolidated Financial Statements have been prepared in accordance with U.S. GAAP, which requires management to make estimates and assumptions that affect amounts reported in the Consolidated Financial Statements and accompanying disclosures. Although these estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future, actual results may differ from those estimates. Management uses historical experience and all available information to make these estimates. The unaudited interim Consolidated Financial Statements reflect all adjustments of a normal, recurring nature that are, in the opinion of management, necessary for a fair statement of results for these interim periods.

Share Repurchase Program - On February 24, 2020, the Company announced that its Board of Directors had authorized a share repurchase program of up to $100 million of the Company's common stock. On April 28, 2022, the Company announced that its Board of Directors had increased the authorization by up to $150 million in additional aggregate value. The timing and amount of any shares repurchased will be determined by the Company based on its evaluation of market conditions and other factors, and will be made in accordance with applicable securities laws in either the open market or in privately negotiated transactions. The Company is not obligated to purchase any shares under the program, and the program may be suspended or discontinued at any time. The actual timing, number, and share price of shares repurchased will depend on a number of factors, including the market price of the Company’s common stock, general market and economic conditions, and applicable legal requirements. Any shares repurchased will be held as treasury stock. During the nine months ended September 30, 2022 and 2021, the Company repurchased 2,339,045 shares and 1,011,124 shares of common stock, respectively, for a total of $44.0 million and $20.0 million, respectively.

Non-cash Investing Activities - Purchases of property, plant, and equipment included in accounts payable at September 30, 2022 and 2021 were $1.6 million and $3.6 million, respectively. These non-cash amounts are not reflected as Capital expenditures within Investing Activities on the Consolidated Statements of Cash Flows for the respective periods.

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Recent Accounting Standards (Notes)

9 Months Ended

Sep. 30, 2022

Accounting Standards Update and Change in Accounting Principle [Abstract]

Recent Accounting Standards

2. Recent Accounting Standards

Recently Adopted Accounting Standards

In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-06 to simplify the accounting for certain financial instruments with characteristics of liabilities and equity. The standard eliminates certain accounting models that separated embedded conversion features from host contracts for convertible instruments, requiring bifurcation only if the convertible feature qualifies as a derivative under Accounting Standards Codification ("ASC") 815 or for convertible instruments issued at a substantial premium. In addition, the guidance requires the if-converted method of calculating diluted earnings per share for convertible instruments, which eliminates the use of the treasury stock method for instruments that may be settled in cash or shares. The standard can be adopted on a modified retrospective basis to transactions outstanding as of the adoption date or on a fully retrospective basis to all periods presented. The Company adopted the standard using the modified retrospective method on January 1, 2022. Adoption of the standard did not impact the Consolidated Financial Statements as all of the Company’s convertible instruments were settled prior to the adoption date. See Note 9. Borrowings for detail on the Company's convertible instruments that matured on November 1, 2021.

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Business Combinations

5 Months Ended

Sep. 30, 2021

Business Combinations [Abstract]

Acquisitions

3. Acquisition

On May 3, 2021, the Company acquired all of the outstanding shares of common stock of Integrated Microwave Corporation ("IMC") for $81.4 million. During the first quarter of 2022, the Company recorded a purchase price adjustment of $0.7 million that was paid during the second quarter of 2022. The adjustment, which did not impact the Consolidated Statements of Earnings, resulted in an increase to goodwill of $0.7 million. The acquired business provides RF filters to the defense, industrial, and communications markets. The transaction was accounted for under the acquisition method of accounting and the results of operations are included in the Consolidated Financial Statements from the date of acquisition in the Precision Devices ("PD") segment. Included in the Consolidated Statements of Earnings are IMC’s revenues and loss before income taxes of $7.0 million and $0.2 million, respectively, from the date of acquisition through September 30, 2021.

The table below represents the final allocation of the purchase price to net assets acquired as of May 3, 2021:

(in millions)
Cash	$	2.2
Receivables	3.0
Inventories	2.6
Property, plant, and equipment	8.3
Customer relationships	27.7
Developed technology	5.2
Trademarks and other amortized intangible assets	1.6
Goodwill	32.0
Assumed current liabilities	(1.2)
Total purchase price	$	81.4

The fair value for customer relationships was determined using the multi-period excess earnings method under the income approach. This method reflects the present value of expected future cash flows less charges representing the contribution of other assets to those cash flows. The fair value for developed technology was determined using the relief from royalty method under the income approach. The fair value measurements of intangible assets are based on significant unobservable inputs, and thus represent Level 3 inputs. Significant assumptions used in assessing the fair values of customer relationships and developed technology include forecasted revenue growth rates, profit margins, customer attrition rates, royalty rates, and discount rates. Discount rates of 13.0% and 14.0% were applied to the expected future cash flows to reflect the risk related to customer relationships and developed technology, respectively. Customer relationships and developed technology will be amortized on a straight-line basis over estimated useful lives of 8 years and 10 years, respectively.

The excess of the total purchase price over the total fair value of the identifiable assets and liabilities was recorded as goodwill. The goodwill recognized is primarily attributable to synergies and the assembled workforce. All of the goodwill resulting from this acquisition is tax deductible. Goodwill has been allocated to the PD segment, which is the segment expected to benefit from the acquisition.

The Company believes the fair values assigned to intangible assets are based on reasonable assumptions and estimates that approximate the amounts a market participant would pay for these intangible assets as of the acquisition date. Actual results could differ materially from these estimates.

Pro-forma financial information has not been provided as the acquisition did not have a material impact on the Consolidated Statements of Earnings.

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Inventories, net (Notes)

9 Months Ended

Sep. 30, 2022

Inventory, Net [Abstract]

Inventories, net

5. Inventories, net

The following table details the major components of inventories, net:

(in millions)	September 30, 2022		December 31, 2021
Raw materials	$	117.0	$	89.6
Work in progress	32.8		33.6
Finished goods	84.1		66.7
Subtotal	233.9		189.9
Less reserves	(39.3)		(36.8)
Total	$	194.6	$	153.1

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Property, Plant, and Equipment, net (Notes)

9 Months Ended

Sep. 30, 2022

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment, net

6. Property, Plant, and Equipment, net

The following table details the major components of property, plant, and equipment, net:

(in millions)	September 30, 2022		December 31, 2021
Land	$	12.3	$	12.9
Buildings and improvements	112.1		119.3
Machinery, equipment, and other	528.0		575.0
Subtotal	652.4		707.2
Less accumulated depreciation	(488.0)		(506.4)
Total	$	164.4	$	200.8

Depreciation expense totaled $9.8 million and $11.5 million for the three months ended September 30, 2022 and 2021, respectively. For the nine months ended September 30, 2022 and 2021, depreciation expense totaled $32.5 million and $35.1 million, respectively.

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Goodwill and Other Intangible Assets (Notes)

9 Months Ended

Sep. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

7. Goodwill and Other Intangible Assets

The changes in the carrying value of goodwill by reportable segment for the nine months ended September 30, 2022 are as follows:

(in millions)	Audio		Precision Devices		Total
Balance at December 31, 2021	$	878.8	$	62.5	$	941.3
Impairment charges (1)	(239.8)		—		(239.8)
Purchase price adjustment	—		0.7		0.7
Foreign currency translation	(0.1)		—		(0.1)
Balance at September 30, 2022	$	638.9	$	63.2	$	702.1
(1) During the nine months ended September 30, 2022, the Company recorded a $239.8 million impairment charge on goodwill. See Note 4. Impairment Charges for more information.

Other Intangible Assets

The gross carrying value and accumulated amortization for each major class of intangible assets are as follows:

	September 30, 2022				December 31, 2021
(in millions)	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets:
Trademarks	$	2.0	$	0.8	$	2.0	$	0.6
Customer relationships	36.4		9.2		36.4		5.9
Developed technology	45.4		18.4		45.4		13.2
Other	2.4		1.7		2.4		1.2
Total	86.2		30.1		86.2		20.9
Unamortized intangible assets:
Trademarks	32.0				32.0
Total intangible assets, net	$	88.1			$	97.3

Amortization expense totaled $3.1 million and $4.3 million for the three months ended September 30, 2022 and 2021, respectively. For the nine months ended September 30, 2022 and 2021, amortization expense was $9.2 million and $11.5 million, respectively. Amortization expense for the next five years, based on current definite-lived intangible balances, is estimated to be as follows:

(in millions)
Q4 2022	$	3.1
2023	11.6
2024	11.6
2025	11.2
2026	5.3

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Restructuring and Related Activities (Notes)

9 Months Ended

Sep. 30, 2022

Restructuring and Related Activities [Abstract]

Restructuring and Related Activities

8. Restructuring and Related Activities

Restructuring and related activities are designed to better align the Company's operations with current market conditions through targeted facility consolidations, headcount reductions, and other measures to further optimize operations.

During the nine months ended September 30, 2022, the Company restructured its MEMS microphones product line through two restructuring programs, which are included within the Audio segment. These actions resulted in the settlement of supplier obligations, non-cash fixed asset write-offs, and severance pay. During the nine months ended September 30, 2022, the Company recorded restructuring charges of $35.1 million related to this action, including $21.9 million for the settlement of supplier obligations, $8.9 million in fixed asset write-offs, and $4.3 million in severance pay and benefits. The Company may incur additional restructuring charges of up to $9.4 million during the remainder of the fiscal year for certain fixed assets, which cannot be reasonably estimated at this time due to the complex nature of the assets under review for use in other projects.

In addition, during the nine months ended September 30, 2022, the Company recorded restructuring charges of $2.2 million for severance pay and benefits to rationalize the Intelligent Audio product line workforce, which is included within the Audio segment, and $0.6 million for other costs.

During the three and nine months ended September 30, 2022, the Company recorded total restructuring charges within Gross profit of $28.1 million, primarily for the settlement of supplier obligations, non-cash fixed asset write-offs, and severance pay associated with the MEMS microphones product line. During the three and nine months ended September 30, 2022, the Company recorded total restructuring charges within Operating expenses of $2.7 million and $9.8 million, respectively, primarily for the settlement of supplier obligations and severance pay and benefits associated with the MEMS microphones product line and other actions to rationalize the Intelligent Audio product line workforce.

No restructuring charges were recorded within Gross profit for the three and nine months ended September 30, 2021. During the nine months ended September 30, 2021, the Company recorded restructuring charges within Operating expenses of $0.3 million. No restructuring charges were recorded within Operating expenses for the three months ended September 30, 2021.

The following table details restructuring charges incurred by reportable segment for the periods presented:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2022		2021		2022		2021
Audio	$	30.7	$	—	$	37.3	$	0.3
Precision Devices	—		—		—		—
Corporate	0.1		—		0.6		—
Total	$	30.8	$	—	$	37.9	$	0.3

The following table details the Company’s severance and other restructuring accrual activity:

(in millions)	Severance Pay and Benefits		Contract Termination and Other Costs		Total
Balance at December 31, 2021	$	0.4	$	—	$	0.4
Restructuring charges	6.5		31.4		37.9
Payments	(3.8)		(1.0)		(4.8)
Other, including foreign currency (1)	(0.1)		(8.9)		(9.0)
Balance at September 30, 2022	$	3.0	$	21.5	$	24.5

(1) Other activity includes the non-cash disposal of fixed assets of $8.9 million within the MEMS microphones product line.

The severance and restructuring accruals are recorded in the following line item on the Consolidated Balance Sheets:

(in millions)	September 30, 2022		December 31, 2021
Other accrued expenses	$	6.6	$	0.4
Other liabilities	17.9		—
Total	$	24.5	$	0.4

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Borrowings (Notes)

9 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

Debt Disclosure

9. Borrowings

Revolving Credit Facility

Revolving credit facility borrowings consist of the following:

(in millions)	September 30, 2022		December 31, 2021
Revolving credit facility	$	78.0	$	70.0
Less current maturities (1)	—		—
Total long-term debt	$	78.0	$	70.0

(1) There are no required principal payments due until maturity in January 2024.

On September 4, 2020, the Company entered into a new Credit Agreement (the "New Credit Agreement"). The New Credit Agreement provides for a senior secured revolving credit facility (the "New Credit Facility") with borrowings in an aggregate principal amount at any time outstanding not to exceed $400.0 million. The New Credit Agreement serves as refinancing of indebtedness and terminates the Company's Revolving Credit Facility Agreement dated as of October 11, 2017 ("Prior Credit Facility"). The Prior Credit Facility consisted of a $400.0 million senior secured revolving credit facility.

At any time during the term of the New Credit Facility, the Company will be permitted to increase the commitments under the New Credit Facility or to establish one or more incremental term loan facilities under the New Credit Facility in an aggregate principal amount not to exceed $200.0 million for all such incremental facilities. Commitments under the New Credit Facility will terminate, and loans outstanding thereunder will mature, on January 2, 2024.

The New Credit Agreement includes requirements, to be tested quarterly, that the Company maintains (i) a minimum ratio of Consolidated EBITDA to consolidated interest expense of 3.25 to 1.0 (the "Interest Coverage Ratio"), (ii) a maximum ratio of Consolidated total indebtedness to Consolidated EBITDA of 3.75 to 1.0 (the "Total Leverage Ratio"), and (iii) a maximum ratio of senior secured indebtedness to Consolidated EBITDA of 3.25 to 1.0 (the "Senior Secured Leverage Ratio"). For these ratios, Consolidated EBITDA and consolidated interest expense are calculated using the most recent four consecutive fiscal quarters in a manner defined in the New Credit Agreement. At September 30, 2022, the Company was in compliance with these covenants and it expects to remain in compliance with all of its debt covenants over the next twelve months.

The interest rates under the New Credit Facility will be, at the Borrowers' option (1) LIBOR (or EURIBOR for borrowings denominated in Euro; or SONIA for borrowings denominated in Pounds Sterling) plus the rates per annum determined from time to time based on the total leverage ratio of the Company as of the end of and for the most recent period of four fiscal quarters for which financial statements have been delivered (the "Applicable Margin"); or (2) in the case of borrowings denominated in U.S. dollars, alternate base rate ("ABR") (as defined in the New Credit Agreement) plus the Applicable Margin. The Applicable Margin for LIBOR could range from 1.50% to 2.50% while the Applicable Margin for ABR could range from 0.50% to 1.50%. Prior to the discontinuation of the relevant LIBOR reference rate on June 30, 2023, the Company and its lenders will agree on an ABR to address the replacement of LIBOR for the remaining life of the New Credit Facility.

The interest rate under the New Credit Facility is variable based on LIBOR at the time of the borrowing and the Applicable Margin. In addition, a commitment fee accrues on the average daily unused portion of the New Credit Facility at a rate of 0.225% to 0.375%.

The weighted-average interest rate on the Company's borrowings under the New Credit Facility was 2.62% for the nine months ended September 30, 2022. There were no borrowings outstanding under the New Credit Facility during the nine months ended September 30, 2021. The weighted-average commitment fee on the revolving line of credit was 0.23% and 0.26% for the nine months ended September 30, 2022 and 2021, respectively.

3.25% Convertible Senior Notes Due November 1, 2021

In May 2016, the Company issued $172.5 million aggregate principal amount of 3.25% convertible senior notes which matured on November 1, 2021 (the “Notes”). Interest was payable semiannually in arrears on May 1 and November 1 of each year. The Notes were governed by an Indenture between the Company, as issuer, and U.S. Bank National Association as trustee. Upon conversion, the Company could elect to pay or deliver cash, shares of the Company's common stock, or a combination of cash and shares of common stock. On November 1, 2021, the Company settled the principal amount of the Notes in cash and the excess conversion value by delivering 0.4 million shares of its common stock held in treasury. The conversion rate was 54.2741 shares of common stock per $1,000 principal amount of Notes. The conversion price was $18.4250 per share of common stock. The Notes were senior unsecured obligations.

In accounting for the issuance of the Notes, the Company separated the Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that did not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the face value of the Notes as a whole. The excess of the principal amount of the liability component over its carrying amount was amortized to interest expense over the term of the Notes.

The following table sets forth total interest expense recognized related to the Notes:

	Three Months Ended			Nine Months Ended
(in millions)		September 30, 2021		September 30, 2021
3.25% coupon		$	1.4	$	4.2
Amortization of debt issuance costs		0.2		0.7
Amortization of debt discount		2.1		6.0
Total		$	3.7	$	10.9

Warrants

In the second quarter of 2016, the Company entered into warrant transactions, whereby the Company sold warrants to acquire shares of the Company's common stock at a strike price of $21.1050 per share (the “Warrants”). The Company received aggregate proceeds of $39.1 million from the sale of the Warrants. The Warrants were separate transactions entered into by the Company, and were not part of the Notes, and were accounted for as part of additional paid-in capital.

The Warrants expired during the first quarter of 2022, which resulted in the Company delivering 0.2 million shares of its common stock held in treasury. Settlement of the Warrants resulted in a $3.1 million decrease in treasury stock, which was measured based on the acquisition cost of the delivered shares determined on a first-in, first-out (“FIFO”) basis, offset by an equivalent decrease in additional paid-in capital with no net impact to equity.

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Other Comprehensive Earnings

9 Months Ended

Sep. 30, 2022

Statement of Other Comprehensive Income [Abstract]

Other Comprehensive Earnings

10. Other Comprehensive Earnings

The amounts recognized in other comprehensive loss were as follows:

	Three Months Ended						Three Months Ended
	September 30, 2022						September 30, 2021
(in millions)	Pre-tax		Tax		Net of tax		Pre-tax		Tax		Net of tax
Foreign currency translation	$	(13.1)	$	—	$	(13.1)	$	(3.7)	$	—	$	(3.7)
Employee benefit plans	0.2		(0.4)		(0.2)		0.2		(0.1)		0.1
Changes in fair value of cash flow hedges	(1.3)		—		(1.3)		(0.3)		0.2		(0.1)
Total other comprehensive loss	$	(14.2)	$	(0.4)	$	(14.6)	$	(3.8)	$	0.1	$	(3.7)
	Nine Months Ended						Nine Months Ended
	September 30, 2022						September 30, 2021
(in millions)	Pre-tax		Tax		Net of tax		Pre-tax		Tax		Net of tax
Foreign currency translation	$	(30.9)	$	—	$	(30.9)	$	(6.4)	$	—	$	(6.4)
Employee benefit plans	0.5		(0.7)		(0.2)		0.6		0.1		0.7
Changes in fair value of cash flow hedges	(4.1)		0.3		(3.8)		(2.1)		0.2		(1.9)
Total other comprehensive loss	$	(34.5)	$	(0.4)	$	(34.9)	$	(7.9)	$	0.3	$	(7.6)

The following tables summarize the changes in balances of each component of accumulated other comprehensive loss, net of tax during the nine months ended September 30, 2022 and 2021:

(in millions)	Cash flow hedges		Employee benefit plans		Cumulative foreign currency translation adjustments		Total
Balance at December 31, 2021	$	0.3	$	(17.1)	$	(83.6)	$	(100.4)
Other comprehensive loss, net of tax	(3.8)		(0.2)		(30.9)		(34.9)
Balance at September 30, 2022	$	(3.5)	$	(17.3)	$	(114.5)	$	(135.3)

(in millions)	Cash flow hedges		Employee benefit plans		Cumulative foreign currency translation adjustments		Total
Balance at December 31, 2020	$	1.6	$	(22.1)	$	(80.0)	$	(100.5)
Other comprehensive (loss) earnings, net of tax	(1.9)		0.7		(6.4)		(7.6)
Balance at September 30, 2021	$	(0.3)	$	(21.4)	$	(86.4)	$	(108.1)

The following tables summarize the amounts reclassified from accumulated other comprehensive loss to earnings:

		Three Months Ended September 30,
(in millions)	Statement of Earnings Line	2022		2021
Pension and post-retirement benefit plans:
Amortization or settlement of actuarial losses and prior service costs	Other income, net	$	0.2	$	0.2
Tax	(Benefit from) provision for income taxes	(0.4)		(0.1)
Net of tax		$	(0.2)	$	0.1
Cash flow hedges:
Net losses reclassified into earnings	Cost of goods sold	$	2.0	$	—
Tax	(Benefit from) provision for income taxes	(0.3)		0.1
Net of tax		$	1.7	$	0.1
		Nine Months Ended September 30,
(in millions)	Statement of Earnings Line	2022		2021
Pension and post-retirement benefit plans:
Amortization or settlement of actuarial losses and prior service costs	Other income, net	$	0.5	$	0.6
Tax	(Benefit from) provision for income taxes	(0.7)		0.1
Net of tax		$	(0.2)	$	0.7
Cash flow hedges:
Net losses (gains) reclassified into earnings	Cost of goods sold	$	2.7	$	(1.9)
Tax	(Benefit from) provision for income taxes	(0.4)		0.5
Net of tax		$	2.3	$	(1.4)

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Income Taxes (Notes)

9 Months Ended

Sep. 30, 2022

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

11. Income Taxes

Income taxes for the interim periods presented have been included in the accompanying Consolidated Financial Statements on the basis of an estimated annual effective tax rate ("ETR"). The determination of the consolidated provision for income taxes requires management to make certain judgments and estimates. Changes in the estimated level of annual pre-tax earnings or loss, tax laws, and changes resulting from tax audits can affect the overall ETR, which impacts the level of income tax expense or benefit and net income or loss. Judgments and estimates related to the Company’s projections and assumptions are inherently uncertain and therefore, actual results could differ materially from projections.

The Company's ETR from continuing operations for the three and nine months ended September 30, 2022, respectively, was 119.9% resulting in $16.3 million of tax benefit, and (5.9)% resulting in $12.4 million of tax expense (inclusive of discrete items totaling $1.6 million of benefit). The provision for the nine months ended September 30, 2022 is the result of estimated tax expense for the year in relation to the estimated pre-tax loss for the year, which when applied to the pre-tax loss results in tax expense. The discrete items impacting the tax provision for the three and nine months ended September 30, 2022 were primarily attributable to the stock-based compensation deduction. Absent the discrete items, the ETR from continuing operations for the three and nine months ended September 30, 2022 was 119.9% and (6.7)%, respectively. During the three and nine months ended September 30, 2021, the ETR from continuing operations was a 14.2% provision (inclusive of discrete items totaling $0.4 million of provision) and a 13.1% provision (inclusive of discrete items totaling $0.9 million of benefit), respectively. Absent the discrete items, the ETR from continuing operations for the three and nine months ended September 30, 2021 was a 13.0% provision and a 14.5% provision, respectively. The Company accrues taxes in various countries where it generates income and applies a valuation allowance in other jurisdictions, which resulted in the provision for the three and nine months ended September 30, 2022 and 2021.

The Company's ETR is favorably impacted by tax holidays granted to the Company in Malaysia and China. The Company secured the Chinese tax holiday in the first quarter of 2022. These tax holidays are subject to the Company's annual satisfaction of certain conditions, including investment and sales thresholds. If the Company fails to satisfy such conditions, the Company's ETR may be significantly adversely impacted. The continuing operations impact of the tax holidays in Malaysia and China for the three and nine months ended September 30, 2022 was approximately a $4.0 million expense and a $0.9 million benefit, respectively, or $(0.04) and $0.01 on a basic (loss) earnings per share basis. The $4.0 million expense for the three months ended September 30, 2022 was attributable to the MEMS microphones product line restructuring activities in Malaysia and China. The continuing operations benefit of these incentives for the three and nine months ended September 30, 2021 was approximately $3.9 million and $9.3 million, respectively, or $0.04 and $0.10 on a basic earnings per share basis. The Company's existing significant tax holiday in Malaysia will expire on December 31, 2026, while the tax holiday in China will expire on December 31, 2023.

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Equity Incentive Program (Notes)

9 Months Ended

Sep. 30, 2022

Share-Based Payment Arrangement, Noncash Expense [Abstract]

Equity Incentive Program

12. Equity Incentive Program

Stock-based compensation expense recognized in the Consolidated Statements of Earnings totaled $6.8 million and $7.1 million for the three months ended September 30, 2022 and 2021, respectively. For the nine months ended September 30, 2022 and 2021, stock-based compensation expense was $21.6 million and $25.6 million, respectively. The tax benefit recognized related to stock-based compensation expense was $0.1 million and $4.1 million for the three and nine months ended September 30, 2022, respectively. No tax benefit was recognized related to stock-based compensation expense for the three and nine months ended September 30, 2021.

Stock Options and SSARs

The expense related to stock options granted in the nine months ended September 30, 2022 and 2021 was estimated on the date of grant using a Black-Scholes option-pricing model based on the assumptions shown in the table below:

	Nine Months Ended September 30,
	2022	2021
Risk-free interest rate	0.85%	0.06%
Dividend yield	—%	—%
Expected life (years)	4.5	4.5
Volatility	34.3%	36.0%
Fair value at date of grant	$6.29	$6.14	to	$6.31

The following table summarizes the Company's stock-settled stock appreciation right ("SSAR") and stock option activity for the nine months ended September 30, 2022:

	SSARs						Stock Options
	Number of Shares	Weighted-Average Exercise Price		Aggregate Intrinsic Value		Weighted-Average Remaining Contractual Term (Years)	Number of Shares	Weighted-Average Exercise Price		Aggregate Intrinsic Value		Weighted-Average Remaining Contractual Term (Years)
(in millions, except share and per share amounts)
Outstanding at December 31, 2021	375,964	$	23.16				3,478,438	$	15.04
Granted	—	—					216,813	21.14
Exercised	(36,759)	21.77					(529,199)	12.21
Forfeited	—	—					(69,873)	20.63
Expired	(95,573)	21.77					(12,222)	17.41
Outstanding at September 30, 2022	243,632	$	23.92	$	—	0.4	3,083,957	$	15.82	$	0.7	2.7
Exercisable at September 30, 2022	243,632	$	23.92	$	—	0.4	2,582,778	$	15.17	$	0.7	2.2

There was no unrecognized compensation expense related to SSARs at September 30, 2022. At September 30, 2022, unrecognized compensation expense related to stock options not yet exercisable of $1.7 million is expected to be recognized over a weighted-average period of 1.3 years.

RSUs

The following table summarizes the Company's restricted stock unit ("RSU") activity for the nine months ended September 30, 2022:

	Share units	Weighted-average grant date fair value
Unvested at December 31, 2021	1,778,639	$	18.89
Granted	1,203,872	20.55
Vested (1)	(817,082)	18.17
Forfeited	(243,411)	20.15
Unvested at September 30, 2022	1,922,018	$	20.04

(1) The number of RSUs vested includes shares that the Company withheld on behalf of employees to satisfy statutory tax withholding requirements.

At September 30, 2022, $25.3 million of unrecognized compensation expense related to RSUs is expected to be recognized over a weighted-average period of 1.8 years.

PSUs

The Company grants performance share units (“PSUs”) to senior management. In each case, the awards will cliff vest three years following the grant date. PSUs will be settled in shares of the Company's common stock. Depending on the Company's overall performance relative to the applicable measures, the size of the PSU awards are subject to adjustment, up or down, resulting in awards at the end of the performance period that can range from 0% to 225% of target. The Company will ratably recognize the expense over the applicable service period for each grant of PSUs and adjust the expense for the expected achievement of performance conditions as appropriate. The fair value of PSUs is determined by using a Monte Carlo simulation. For the awards granted in February 2022 and 2021, the number of PSUs that may be earned and vest is based on total shareholder return (“TSR”) relative to the component companies of the Russell 2000 Index over a three-year performance period.

The COVID-19 pandemic brought on unique and unprecedented challenges to the Company, particularly in the hearing health and medtech markets. Many of the Company's executive compensation programs were affected, including outstanding PSU awards. Due to the impact of the COVID-19 pandemic on the Company’s overall business performance, effective February 8, 2021, the Company’s Compensation Committee approved certain modifications to PSUs granted in February 2018, 2019, and 2020.

For the awards granted in February 2018 (the “2018 PSUs”), the number of PSUs that may be earned and vest was originally based on the Company’s revenues and stock price performance over a three-year performance period. The modified award was based on the Company’s revenues and stock price performance over three separate one-year performance periods to isolate the impact of the COVID-19 pandemic on the Company's fiscal 2020 performance. In addition, the performance periods corresponding to fiscal 2018 and 2019 were weighted at 25% each while the performance period corresponding to fiscal 2020 was weighted at 50%, given the impact of fiscal 2020 performance on shareholders. Service conditions were not modified. The modification of the 2018 PSUs affected nine employees and resulted in total incremental compensation expense of $3.9 million, which was recognized in the first quarter of 2021 as there was no remaining service period. In February 2021, the 2018 PSUs were converted from 329,092 PSUs to 190,544 shares of common stock based on achievement of the modified conditions.

For the awards granted in February 2019 (the “2019 PSUs”), the number of PSUs that may be earned and vest was originally based on the Company's revenues and TSR relative to the component companies of the S&P Semiconductor Select Industry Index over a three-year performance period. The modified award was based on the Company’s revenues and TSR relative to the component companies of the S&P Semiconductor Select Industry Index over three separate one-year performance periods to isolate the impact of the COVID-19 pandemic on the Company's fiscal 2020 performance. Each period was weighted equally, as the Company expected to face challenges related to the COVID-19 pandemic in fiscal 2021. Service conditions were not modified. The modification of the 2019 PSUs affected eight employees and resulted in total incremental compensation expense of $2.4 million, which was recognized over the remaining service period. Incremental compensation expense was subject to adjustment for the achievement of the performance condition based on fiscal 2021 revenues. In February 2022, the 2019 PSUs were converted from 227,812 PSUs to 150,811 shares of common stock based on achievement of the modified conditions.

For the awards granted in February 2020 (the “2020 PSUs”), the number of PSUs that may be earned and vest was originally based on TSR relative to the component companies of the S&P Semiconductor Select Industry Index over a three-year performance period. The modified award replaces the S&P Semiconductor Select Industry Index with the Russell 2000 Index. The Company is a member of the Russell 2000 Index, which represents a broader, more diversified index that better aligns with the Company's strategy. Service conditions were not modified. The modification of the 2020 PSUs affected eight employees and resulted in total incremental compensation expense of $4.7 million, which will be recognized over the remaining service period.

The following table summarizes the Company's PSU activity for the nine months ended September 30, 2022:

	Share units	Weighted-average grant date fair value
Unvested at December 31, 2021	766,466	$	21.28
Granted	294,935	29.92
Vested (1)	(227,812)	18.44
Forfeited	—	—
Unvested at September 30, 2022	833,589	$	25.12

(1) The number of PSUs vested includes shares that the Company withheld on behalf of employees to satisfy statutory tax withholding requirements.

At September 30, 2022, $11.8 million of unrecognized compensation expense related to PSUs is expected to be recognized over a weighted-average period of 1.4 years.

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Earnings per Share (Notes)

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

Earnings per Share

13. Earnings per Share

Basic and diluted earnings per share were computed as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions, except per share amounts)	2022		2021		2022		2021
Earnings (loss) from continuing operations	$	2.7	$	27.7	$	(222.1)	$	57.6
Earnings from discontinued operations, net	—		—		—		0.2
Net earnings (loss)	$	2.7	$	27.7	$	(222.1)	$	57.8
Basic earnings (loss) per common share:
Earnings (loss) from continuing operations	$	0.03	$	0.30	$	(2.42)	$	0.62
Earnings from discontinued operations, net	—		—		—		0.01
Net earnings (loss)	$	0.03	$	0.30	$	(2.42)	$	0.63
Weighted-average shares outstanding	91.4		92.2		91.9		92.3
Diluted earnings (loss) per common share:
Earnings (loss) from continuing operations	$	0.03	$	0.29	$	(2.42)	$	0.61
Earnings from discontinued operations, net	—		—		—		—
Net earnings (loss)	$	0.03	$	0.29	$	(2.42)	$	0.61
Weighted-average shares outstanding	92.0		94.1		91.9		94.8

The Company intended to settle the principal amount of the Notes in cash during all periods preceding settlement. The treasury stock method was used to calculate the dilutive effect of the conversion option on diluted earnings per share, if applicable. For the three and nine months ended September 30, 2022, the weighted-average number of anti-dilutive potential common shares for stock-based awards excluded from the diluted earnings per share calculation above was 3.2 million and 3.0 million, respectively. For the three and nine months ended September 30, 2021, the weighted-average number of anti-dilutive potential common shares for stock-based awards excluded from the diluted earnings per share calculation above was 1.1 million and 1.3 million, respectively.

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Commitments and Contingent Liabilities (Notes)

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingent Liabilities

14. Commitments and Contingent Liabilities

From time to time, the Company is involved in various legal proceedings and claims arising in the ordinary course of its business. The majority of these claims and proceedings relate to commercial, warranty, employment, and intellectual property matters. Although the ultimate outcome of any legal proceeding or claim cannot be predicted with certainty, based on present information, including management’s assessment of the merits of the particular claim, the Company believes that the disposition of these legal proceedings or claims, individually or in the aggregate, after taking into account recorded accruals and the availability and limits of insurance coverage, will not have a material adverse effect on its cash flow, results of operations, or financial condition.

The Company owns many patents and other intellectual property pertaining to its products, technology, and manufacturing processes. Some of the Company's patents have been and may continue to be infringed upon or challenged by others. In appropriate cases, the Company has taken and will take steps to protect and defend its patents and other intellectual property, including through the use of legal proceedings in various jurisdictions around the world. Such steps have resulted in and may continue to result in retaliatory legal proceedings, including litigation or other legal proceedings in various jurisdictions and forums around the world alleging infringement by the Company of patents owned by others. The costs of investigations and legal proceedings relating to the enforcement and defense of the Company’s intellectual property may be substantial. Additionally, in multi-forum disputes, the Company may incur adverse judgments with regard to certain claims in certain jurisdictions and forums while still contesting other related claims against the same opposing party in other jurisdictions and forums.

Intellectual Property Infringement Claims

The Company may, on a limited customer specific basis, provide contractual indemnities for certain losses that arise out of claims that its products infringe on the intellectual property of others. It is not possible to determine the maximum potential amount under these indemnification agreements due to the unique facts and circumstances involved in each particular agreement. Historically, the Company has not made significant payments under such indemnity arrangements. The Company’s legal accruals associated with these indemnity arrangements were not significant at September 30, 2022 and December 31, 2021.

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Segment Information (Notes)

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

Segment Information

15. Segment Information

The Company's two reportable segments are Audio and Precision Devices. Information regarding the Company's reportable segments is as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2022		2021		2022		2021
Revenues:
Audio	$	113.8	$	177.7	$	388.0	$	490.6
Precision Devices	64.4		55.3		179.6		143.2
Total revenues	$	178.2	$	233.0	$	567.6	$	633.8
(Loss) earnings from continuing operations before interest and income taxes:
Audio	$	(16.9)	$	36.6	$	(210.9)	$	95.0
Precision Devices	16.2		14.0		39.5		28.3
Total segments	(0.7)		50.6		(171.4)		123.3
Corporate expense / other	11.8		14.1		35.6		44.7
Interest expense, net	1.1		4.2		2.7		12.3
(Loss) earnings before income taxes and discontinued operations	(13.6)		32.3		(209.7)		66.3
(Benefit from) provision for income taxes	(16.3)		4.6		12.4		8.7
Earnings (loss) from continuing operations	$	2.7	$	27.7	$	(222.1)	$	57.6

Information regarding assets of the Company's reportable segments:

	Total Assets
(in millions)	September 30, 2022		December 31, 2021
Audio	$	1,149.2	$	1,467.1
Precision Devices	285.2		260.4
Corporate / eliminations	2.3		4.1
Total	$	1,436.7	$	1,731.6

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. The Company's businesses are based primarily in Asia, North America, and Europe.

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2022		2021		2022		2021
Asia	$	105.3	$	163.4	$	347.2	$	452.0
United States	43.7		42.2		129.3		109.3
Europe	24.5		24.6		80.2		65.4
Other Americas	2.9		1.6		5.5		3.9
Other	1.8		1.2		5.4		3.2
Total	$	178.2	$	233.0	$	567.6	$	633.8

Receivables, net from contracts with customers were $118.3 million and $137.7 million as of September 30, 2022 and December 31, 2021, respectively. As of September 30, 2022 and December 31, 2021, our total remaining performance obligations were immaterial.

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Recent Accounting Standards New Accounting Pronouncements, Policy (Policies)

9 Months Ended

Sep. 30, 2022

Accounting Policies [Abstract]

New Accounting Pronouncements, Policy [Policy Text Block]

Recently Adopted Accounting Standards

In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-06 to simplify the accounting for certain financial instruments with characteristics of liabilities and equity. The standard eliminates certain accounting models that separated embedded conversion features from host contracts for convertible instruments, requiring bifurcation only if the convertible feature qualifies as a derivative under Accounting Standards Codification ("ASC") 815 or for convertible instruments issued at a substantial premium. In addition, the guidance requires the if-converted method of calculating diluted earnings per share for convertible instruments, which eliminates the use of the treasury stock method for instruments that may be settled in cash or shares. The standard can be adopted on a modified retrospective basis to transactions outstanding as of the adoption date or on a fully retrospective basis to all periods presented. The Company adopted the standard using the modified retrospective method on January 1, 2022. Adoption of the standard did not impact the Consolidated Financial Statements as all of the Company’s convertible instruments were settled prior to the adoption date. See Note 9. Borrowings for detail on the Company's convertible instruments that matured on November 1, 2021.

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Business Combinations (Tables)

9 Months Ended

Sep. 30, 2022

Business Combinations [Abstract]

Schedule of the Final Allocation of the Purchase Price to Net Assets

The table below represents the final allocation of the purchase price to net assets acquired as of May 3, 2021:

(in millions)
Cash	$	2.2
Receivables	3.0
Inventories	2.6
Property, plant, and equipment	8.3
Customer relationships	27.7
Developed technology	5.2
Trademarks and other amortized intangible assets	1.6
Goodwill	32.0
Assumed current liabilities	(1.2)
Total purchase price	$	81.4

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Inventories (Tables)

9 Months Ended

Sep. 30, 2022

Inventory, Net [Abstract]

Components of Inventory

The following table details the major components of inventories, net:

(in millions)	September 30, 2022		December 31, 2021
Raw materials	$	117.0	$	89.6
Work in progress	32.8		33.6
Finished goods	84.1		66.7
Subtotal	233.9		189.9
Less reserves	(39.3)		(36.8)
Total	$	194.6	$	153.1

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Property, Plant, and Equipment, net (Tables)

9 Months Ended

Sep. 30, 2022

Property, Plant and Equipment [Abstract]

Components of property, plant and equipment, net

The following table details the major components of property, plant, and equipment, net:

(in millions)	September 30, 2022		December 31, 2021
Land	$	12.3	$	12.9
Buildings and improvements	112.1		119.3
Machinery, equipment, and other	528.0		575.0
Subtotal	652.4		707.2
Less accumulated depreciation	(488.0)		(506.4)
Total	$	164.4	$	200.8

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Goodwill and Other Intangible Assets (Tables)

9 Months Ended

Sep. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

The changes in the carrying value of goodwill by reportable segment for the nine months ended September 30, 2022 are as follows:

(in millions)	Audio		Precision Devices		Total
Balance at December 31, 2021	$	878.8	$	62.5	$	941.3
Impairment charges (1)	(239.8)		—		(239.8)
Purchase price adjustment	—		0.7		0.7
Foreign currency translation	(0.1)		—		(0.1)
Balance at September 30, 2022	$	638.9	$	63.2	$	702.1
(1) During the nine months ended September 30, 2022, the Company recorded a $239.8 million impairment charge on goodwill. See Note 4. Impairment Charges for more information.

Schedule of Intangible Assets

The gross carrying value and accumulated amortization for each major class of intangible assets are as follows:

	September 30, 2022				December 31, 2021
(in millions)	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets:
Trademarks	$	2.0	$	0.8	$	2.0	$	0.6
Customer relationships	36.4		9.2		36.4		5.9
Developed technology	45.4		18.4		45.4		13.2
Other	2.4		1.7		2.4		1.2
Total	86.2		30.1		86.2		20.9
Unamortized intangible assets:
Trademarks	32.0				32.0
Total intangible assets, net	$	88.1			$	97.3

Schedule of Future Amortization Expense

Amortization expense for the next five years, based on current definite-lived intangible balances, is estimated to be as follows:

(in millions)
Q4 2022	$	3.1
2023	11.6
2024	11.6
2025	11.2
2026	5.3

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Restructuring and Related Activities (Tables)

9 Months Ended

Sep. 30, 2022

Restructuring and Related Activities [Abstract]

Schedule of Restructuring and Related Costs

The following table details restructuring charges incurred by reportable segment for the periods presented:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2022		2021		2022		2021
Audio	$	30.7	$	—	$	37.3	$	0.3
Precision Devices	—		—		—		—
Corporate	0.1		—		0.6		—
Total	$	30.8	$	—	$	37.9	$	0.3

Schedule of Restructuring Reserve by Type of Cost

The following table details the Company’s severance and other restructuring accrual activity:

(in millions)	Severance Pay and Benefits		Contract Termination and Other Costs		Total
Balance at December 31, 2021	$	0.4	$	—	$	0.4
Restructuring charges	6.5		31.4		37.9
Payments	(3.8)		(1.0)		(4.8)
Other, including foreign currency (1)	(0.1)		(8.9)		(9.0)
Balance at September 30, 2022	$	3.0	$	21.5	$	24.5

Schedule of Restructuring Reserve by Balance Sheet Location

The severance and restructuring accruals are recorded in the following line item on the Consolidated Balance Sheets:

(in millions)	September 30, 2022		December 31, 2021
Other accrued expenses	$	6.6	$	0.4
Other liabilities	17.9		—
Total	$	24.5	$	0.4

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Borrowings (Tables)

9 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments

Revolving credit facility borrowings consist of the following:

(in millions)	September 30, 2022		December 31, 2021
Revolving credit facility	$	78.0	$	70.0
Less current maturities (1)	—		—
Total long-term debt	$	78.0	$	70.0

Schedule of Convertible Debt Interest Expense

The following table sets forth total interest expense recognized related to the Notes:

	Three Months Ended			Nine Months Ended
(in millions)		September 30, 2021		September 30, 2021
3.25% coupon		$	1.4	$	4.2
Amortization of debt issuance costs		0.2		0.7
Amortization of debt discount		2.1		6.0
Total		$	3.7	$	10.9

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Other Comprehensive Loss (Tables)

9 Months Ended

Sep. 30, 2022

Other Comprehensive Income (Loss), Net of Tax [Abstract]

Components of other comprehensive (loss) earnings

The amounts recognized in other comprehensive loss were as follows:

	Three Months Ended						Three Months Ended
	September 30, 2022						September 30, 2021
(in millions)	Pre-tax		Tax		Net of tax		Pre-tax		Tax		Net of tax
Foreign currency translation	$	(13.1)	$	—	$	(13.1)	$	(3.7)	$	—	$	(3.7)
Employee benefit plans	0.2		(0.4)		(0.2)		0.2		(0.1)		0.1
Changes in fair value of cash flow hedges	(1.3)		—		(1.3)		(0.3)		0.2		(0.1)
Total other comprehensive loss	$	(14.2)	$	(0.4)	$	(14.6)	$	(3.8)	$	0.1	$	(3.7)
	Nine Months Ended						Nine Months Ended
	September 30, 2022						September 30, 2021
(in millions)	Pre-tax		Tax		Net of tax		Pre-tax		Tax		Net of tax
Foreign currency translation	$	(30.9)	$	—	$	(30.9)	$	(6.4)	$	—	$	(6.4)
Employee benefit plans	0.5		(0.7)		(0.2)		0.6		0.1		0.7
Changes in fair value of cash flow hedges	(4.1)		0.3		(3.8)		(2.1)		0.2		(1.9)
Total other comprehensive loss	$	(34.5)	$	(0.4)	$	(34.9)	$	(7.9)	$	0.3	$	(7.6)

Schedule of (Loss) Earnings

The following tables summarize the changes in balances of each component of accumulated other comprehensive loss, net of tax during the nine months ended September 30, 2022 and 2021:

(in millions)	Cash flow hedges		Employee benefit plans		Cumulative foreign currency translation adjustments		Total
Balance at December 31, 2021	$	0.3	$	(17.1)	$	(83.6)	$	(100.4)
Other comprehensive loss, net of tax	(3.8)		(0.2)		(30.9)		(34.9)
Balance at September 30, 2022	$	(3.5)	$	(17.3)	$	(114.5)	$	(135.3)

(in millions)	Cash flow hedges		Employee benefit plans		Cumulative foreign currency translation adjustments		Total
Balance at December 31, 2020	$	1.6	$	(22.1)	$	(80.0)	$	(100.5)
Other comprehensive (loss) earnings, net of tax	(1.9)		0.7		(6.4)		(7.6)
Balance at September 30, 2021	$	(0.3)	$	(21.4)	$	(86.4)	$	(108.1)

The following tables summarize the amounts reclassified from accumulated other comprehensive loss to earnings:

		Three Months Ended September 30,
(in millions)	Statement of Earnings Line	2022		2021
Pension and post-retirement benefit plans:
Amortization or settlement of actuarial losses and prior service costs	Other income, net	$	0.2	$	0.2
Tax	(Benefit from) provision for income taxes	(0.4)		(0.1)
Net of tax		$	(0.2)	$	0.1
Cash flow hedges:
Net losses reclassified into earnings	Cost of goods sold	$	2.0	$	—
Tax	(Benefit from) provision for income taxes	(0.3)		0.1
Net of tax		$	1.7	$	0.1
		Nine Months Ended September 30,
(in millions)	Statement of Earnings Line	2022		2021
Pension and post-retirement benefit plans:
Amortization or settlement of actuarial losses and prior service costs	Other income, net	$	0.5	$	0.6
Tax	(Benefit from) provision for income taxes	(0.7)		0.1
Net of tax		$	(0.2)	$	0.7
Cash flow hedges:
Net losses (gains) reclassified into earnings	Cost of goods sold	$	2.7	$	(1.9)
Tax	(Benefit from) provision for income taxes	(0.4)		0.5
Net of tax		$	2.3	$	(1.4)

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Equity Incentive Program (Tables)

9 Months Ended

Sep. 30, 2022

Share-Based Payment Arrangement, Noncash Expense [Abstract]

Schedule of Black-Scholes Option-Pricing Assumptions

The expense related to stock options granted in the nine months ended September 30, 2022 and 2021 was estimated on the date of grant using a Black-Scholes option-pricing model based on the assumptions shown in the table below:

	Nine Months Ended September 30,
	2022	2021
Risk-free interest rate	0.85%	0.06%
Dividend yield	—%	—%
Expected life (years)	4.5	4.5
Volatility	34.3%	36.0%
Fair value at date of grant	$6.29	$6.14	to	$6.31

Schedule of SSAR and Stock Options Activity

The following table summarizes the Company's stock-settled stock appreciation right ("SSAR") and stock option activity for the nine months ended September 30, 2022:

	SSARs						Stock Options
	Number of Shares	Weighted-Average Exercise Price		Aggregate Intrinsic Value		Weighted-Average Remaining Contractual Term (Years)	Number of Shares	Weighted-Average Exercise Price		Aggregate Intrinsic Value		Weighted-Average Remaining Contractual Term (Years)
(in millions, except share and per share amounts)
Outstanding at December 31, 2021	375,964	$	23.16				3,478,438	$	15.04
Granted	—	—					216,813	21.14
Exercised	(36,759)	21.77					(529,199)	12.21
Forfeited	—	—					(69,873)	20.63
Expired	(95,573)	21.77					(12,222)	17.41
Outstanding at September 30, 2022	243,632	$	23.92	$	—	0.4	3,083,957	$	15.82	$	0.7	2.7
Exercisable at September 30, 2022	243,632	$	23.92	$	—	0.4	2,582,778	$	15.17	$	0.7	2.2

Schedule of Restricted Stock Units Award Activity

The following table summarizes the Company's restricted stock unit ("RSU") activity for the nine months ended September 30, 2022:

	Share units	Weighted-average grant date fair value
Unvested at December 31, 2021	1,778,639	$	18.89
Granted	1,203,872	20.55
Vested (1)	(817,082)	18.17
Forfeited	(243,411)	20.15
Unvested at September 30, 2022	1,922,018	$	20.04

(1) The number of RSUs vested includes shares that the Company withheld on behalf of employees to satisfy statutory tax withholding requirements.

Share-based Payment Arrangement, Performance Shares, Outstanding Activity

The following table summarizes the Company's PSU activity for the nine months ended September 30, 2022:

	Share units	Weighted-average grant date fair value
Unvested at December 31, 2021	766,466	$	21.28
Granted	294,935	29.92
Vested (1)	(227,812)	18.44
Forfeited	—	—
Unvested at September 30, 2022	833,589	$	25.12

(1) The number of PSUs vested includes shares that the Company withheld on behalf of employees to satisfy statutory tax withholding requirements.

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Earnings per Share (Tables)

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

Reconciliation of information used in computing basic and diluted earnings per share

Basic and diluted earnings per share were computed as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions, except per share amounts)	2022		2021		2022		2021
Earnings (loss) from continuing operations	$	2.7	$	27.7	$	(222.1)	$	57.6
Earnings from discontinued operations, net	—		—		—		0.2
Net earnings (loss)	$	2.7	$	27.7	$	(222.1)	$	57.8
Basic earnings (loss) per common share:
Earnings (loss) from continuing operations	$	0.03	$	0.30	$	(2.42)	$	0.62
Earnings from discontinued operations, net	—		—		—		0.01
Net earnings (loss)	$	0.03	$	0.30	$	(2.42)	$	0.63
Weighted-average shares outstanding	91.4		92.2		91.9		92.3
Diluted earnings (loss) per common share:
Earnings (loss) from continuing operations	$	0.03	$	0.29	$	(2.42)	$	0.61
Earnings from discontinued operations, net	—		—		—		—
Net earnings (loss)	$	0.03	$	0.29	$	(2.42)	$	0.61
Weighted-average shares outstanding	92.0		94.1		91.9		94.8

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Segment Information (Tables)

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

Revenue and Earnings from continuing operations by market segment

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2022		2021		2022		2021
Revenues:
Audio	$	113.8	$	177.7	$	388.0	$	490.6
Precision Devices	64.4		55.3		179.6		143.2
Total revenues	$	178.2	$	233.0	$	567.6	$	633.8
(Loss) earnings from continuing operations before interest and income taxes:
Audio	$	(16.9)	$	36.6	$	(210.9)	$	95.0
Precision Devices	16.2		14.0		39.5		28.3
Total segments	(0.7)		50.6		(171.4)		123.3
Corporate expense / other	11.8		14.1		35.6		44.7
Interest expense, net	1.1		4.2		2.7		12.3
(Loss) earnings before income taxes and discontinued operations	(13.6)		32.3		(209.7)		66.3
(Benefit from) provision for income taxes	(16.3)		4.6		12.4		8.7
Earnings (loss) from continuing operations	$	2.7	$	27.7	$	(222.1)	$	57.6

Reconciliation of Assets from Segment to Consolidated

Information regarding assets of the Company's reportable segments:

	Total Assets
(in millions)	September 30, 2022		December 31, 2021
Audio	$	1,149.2	$	1,467.1
Precision Devices	285.2		260.4
Corporate / eliminations	2.3		4.1
Total	$	1,436.7	$	1,731.6

Revenue from External Customers by Geographic Areas

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. The Company's businesses are based primarily in Asia, North America, and Europe.

	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2022		2021		2022		2021
Asia	$	105.3	$	163.4	$	347.2	$	452.0
United States	43.7		42.2		129.3		109.3
Europe	24.5		24.6		80.2		65.4
Other Americas	2.9		1.6		5.5		3.9
Other	1.8		1.2		5.4		3.2
Total	$	178.2	$	233.0	$	567.6	$	633.8

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Basis of Presentation (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Apr. 28, 2022	Feb. 24, 2020
Noncash Investing and Financing Items
Purchases of property and equipment included in accounts payable	$ 1.6	$ 3.6
Stock Repurchase Program, Authorized Amount				$ 100.0
Share Repurchase Program, Authorized Amount, Increase (Decrease)			$ 150.0
Payments for Repurchase of Common Stock	$ 44.0	$ 20.0

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Business Combinations (Details) - USD ($)
$ in Millions

5 Months Ended

9 Months Ended

May 03, 2021

Sep. 30, 2021

Sep. 30, 2022

Dec. 31, 2021

Finite-Lived Intangible Assets

Goodwill

$ 702.1

$ 941.3

Goodwill, Purchase Accounting Adjustments

$ 0.7

Acquisitions

3. Acquisition

On May 3, 2021, the Company acquired all of the outstanding shares of common stock of Integrated Microwave Corporation ("IMC") for $81.4 million. During the first quarter of 2022, the Company recorded a purchase price adjustment of $0.7 million that was paid during the second quarter of 2022. The adjustment, which did not impact the Consolidated Statements of Earnings, resulted in an increase to goodwill of $0.7 million. The acquired business provides RF filters to the defense, industrial, and communications markets. The transaction was accounted for under the acquisition method of accounting and the results of operations are included in the Consolidated Financial Statements from the date of acquisition in the Precision Devices ("PD") segment. Included in the Consolidated Statements of Earnings are IMC’s revenues and loss before income taxes of $7.0 million and $0.2 million, respectively, from the date of acquisition through September 30, 2021.

The table below represents the final allocation of the purchase price to net assets acquired as of May 3, 2021:

(in millions)
Cash	$	2.2
Receivables	3.0
Inventories	2.6
Property, plant, and equipment	8.3
Customer relationships	27.7
Developed technology	5.2
Trademarks and other amortized intangible assets	1.6
Goodwill	32.0
Assumed current liabilities	(1.2)
Total purchase price	$	81.4

The fair value for customer relationships was determined using the multi-period excess earnings method under the income approach. This method reflects the present value of expected future cash flows less charges representing the contribution of other assets to those cash flows. The fair value for developed technology was determined using the relief from royalty method under the income approach. The fair value measurements of intangible assets are based on significant unobservable inputs, and thus represent Level 3 inputs. Significant assumptions used in assessing the fair values of customer relationships and developed technology include forecasted revenue growth rates, profit margins, customer attrition rates, royalty rates, and discount rates. Discount rates of 13.0% and 14.0% were applied to the expected future cash flows to reflect the risk related to customer relationships and developed technology, respectively. Customer relationships and developed technology will be amortized on a straight-line basis over estimated useful lives of 8 years and 10 years, respectively.

The excess of the total purchase price over the total fair value of the identifiable assets and liabilities was recorded as goodwill. The goodwill recognized is primarily attributable to synergies and the assembled workforce. All of the goodwill resulting from this acquisition is tax deductible. Goodwill has been allocated to the PD segment, which is the segment expected to benefit from the acquisition.

The Company believes the fair values assigned to intangible assets are based on reasonable assumptions and estimates that approximate the amounts a market participant would pay for these intangible assets as of the acquisition date. Actual results could differ materially from these estimates.

Pro-forma financial information has not been provided as the acquisition did not have a material impact on the Consolidated Statements of Earnings.

Integrated Microwave Corporation

Business Combination Segment Allocation [Line Items]

Payments to Acquire Businesses, Gross

$ 81.4

Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual

$ 0.2

Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual

$ 7.0

Finite-Lived Intangible Assets

Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents

2.2

Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables

3.0

Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory

2.6

Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment

8.3

Goodwill

32.0

Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities

(1.2)

Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net

81.4

Integrated Microwave Corporation | Unpatented Technology [Member]

Finite-Lived Intangible Assets

Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles

$ 5.2

Finite-Lived Intangible Asset, Useful Life

10 years

Finite-Lived Intangible Asset, Useful Life

10 years

Integrated Microwave Corporation | Trademarks

Finite-Lived Intangible Assets

Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles

$ 1.6

Integrated Microwave Corporation | Customer relationships

Finite-Lived Intangible Assets

Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles

$ 27.7

Finite-Lived Intangible Asset, Useful Life

8 years

Finite-Lived Intangible Asset, Useful Life

8 years

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Inventories (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Inventory, Net [Abstract]
Raw materials	$ 117.0	$ 89.6
Work in progress	32.8	33.6
Finished goods	84.1	66.7
Subtotal	233.9	189.9
Less reserves	(39.3)	(36.8)
Total	$ 194.6	$ 153.1

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Property, Plant and Equipment, net (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Property, Plant and Equipment
Cost	$ 652.4		$ 652.4		$ 707.2
Less accumulated depreciation	(488.0)		(488.0)		(506.4)
Total	164.4		164.4		200.8
Depreciation	9.8	$ 11.5	32.5	$ 35.1
Restructuring charges	2.7	0.0	9.8	0.3
Severance Pay and Contract Termination and Other Costs
Property, Plant and Equipment
Restructuring charges	30.8	0.0	37.9	$ 0.3
Severance Pay and Contract Termination and Other Costs | Operating Segments | Corporate, Non-Segment [Member]
Property, Plant and Equipment
Restructuring charges	0.1	$ 0.0
Land
Property, Plant and Equipment
Cost	12.3		12.3		12.9
Buildings and improvements
Property, Plant and Equipment
Cost	112.1		112.1		119.3
Machinery, equipment, and other
Property, Plant and Equipment
Cost	$ 528.0		$ 528.0		$ 575.0

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Goodwill and Other Intangible Assets - Goodwill (Details) - USD ($) $ in Millions	3 Months Ended			9 Months Ended
	Sep. 30, 2022	Mar. 31, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Goodwill [Roll Forward]
Goodwill, Beginning Balance		$ 941.3		$ 941.3
Goodwill, Ending Balance	$ 702.1			702.1
Goodwill, Impairment Loss				(239.8)
Goodwill, Purchase Accounting Adjustments				0.7
Goodwill, Foreign Currency Translation Gain (Loss)				(0.1)
Amortization expense	3.1		$ 4.3	9.2	$ 11.5
Audio
Goodwill [Roll Forward]
Goodwill, Beginning Balance		878.8		878.8
Goodwill, Ending Balance	638.9			638.9
Goodwill, Impairment Loss				(239.8)
Goodwill, Purchase Accounting Adjustments				0.0
Goodwill, Foreign Currency Translation Gain (Loss)				(0.1)
Precision Devices
Goodwill [Roll Forward]
Goodwill, Beginning Balance		62.5		62.5
Goodwill, Ending Balance	$ 63.2			63.2
Goodwill, Impairment Loss				0.0
Goodwill, Foreign Currency Translation Gain (Loss)				$ 0.0
Precision Devices | Integrated Microwave Corporation
Goodwill [Roll Forward]
Goodwill, Purchase Accounting Adjustments		$ 0.7

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Goodwill and Other Intangible Assets - Intangible Assets and Amortization Expense (Details) - USD ($) $ in Millions		3 Months Ended		9 Months Ended
	May 03, 2021	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Finite-Lived Intangible Assets
Gross carrying amount		$ 86.2		$ 86.2		$ 86.2
Accumulated amortization		30.1		30.1		20.9
Intangible assets, net		88.1		88.1		97.3
Amortization expense		3.1	$ 4.3	9.2	$ 11.5
2021		3.1		3.1
2022		11.6		11.6
2023		11.6		11.6
2024		11.2		11.2
2025		5.3		5.3
Trademarks
Finite-Lived Intangible Assets
Unamortized intangible assets, gross carrying amount		32.0		32.0		32.0
Trademarks
Finite-Lived Intangible Assets
Gross carrying amount		2.0		2.0		2.0
Accumulated amortization		0.8		0.8		0.6
Customer relationships
Finite-Lived Intangible Assets
Gross carrying amount		36.4		36.4		36.4
Accumulated amortization		9.2		9.2		5.9
Customer relationships | Integrated Microwave Corporation
Finite-Lived Intangible Assets
Finite-Lived Intangible Asset, Useful Life	8 years
Unpatented Technology [Member]
Finite-Lived Intangible Assets
Gross carrying amount		45.4		45.4		45.4
Accumulated amortization		18.4		18.4		13.2
Unpatented Technology [Member] | Integrated Microwave Corporation
Finite-Lived Intangible Assets
Finite-Lived Intangible Asset, Useful Life	10 years
Other
Finite-Lived Intangible Assets
Gross carrying amount		2.4		2.4		2.4
Accumulated amortization		$ 1.7		$ 1.7		$ 1.2

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Restructuring and Related Activities - Restructuring Charges by Segment (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Restructuring Cost and Reserve
Restructuring charges	$ 2.7	$ 0.0	$ 9.8	$ 0.3
Restructuring and Related Cost, Incurred Cost			37.9
MEMS Microphones product line
Restructuring Cost and Reserve
Restructuring charges			35.1
Severance Pay and Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring charges	30.8	0.0	37.9	0.3
Severance Pay and Benefits
Restructuring Cost and Reserve
Restructuring and Related Cost, Incurred Cost			6.5
Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring and Related Cost, Incurred Cost			31.4
Operating Segments | Audio | Severance Pay and Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring charges	30.7	0.0	37.3	0.3
Operating Segments | Precision Devices | Severance Pay and Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring charges	0.0	0.0	0.0	0.0
Operating Segments | Corporate, Non-Segment [Member] | Severance Pay and Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring charges	0.1	0.0
Corporate, Non-Segment [Member] | Severance Pay and Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring charges			0.6	0.0
Cost of Goods Sold, Restructuring Charges | Severance Pay and Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring charges	28.1	$ 0.0
Operating Expense | Severance Pay and Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring charges	2.7		9.8	$ 0.3
Restructuring Charges | Severance Pay and Benefits | Intelligent Audio [Member]
Restructuring Cost and Reserve
Restructuring charges			2.2
Restructuring Charges | Severance Pay and Benefits | MEMS Microphones product line
Restructuring Cost and Reserve
Restructuring charges			4.3
Restructuring Charges | Contract Termination [Member] | MEMS Microphones product line
Restructuring Cost and Reserve
Restructuring charges			21.9
Restructuring Charges | Other Restructuring | MEMS Microphones product line
Restructuring Cost and Reserve
Restructuring charges			8.9
Restructuring Charges | Audio | Other Restructuring
Restructuring Cost and Reserve
Restructuring charges			0.6
Contract Termination [Member] | MEMS Microphones product line | Maximum [Member]
Restructuring Cost and Reserve
Restructuring and Related Cost, Expected Cost Remaining	$ 9.4		$ 9.4

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Restructuring and Related Activities - Restructuring Accrual Activities (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Restructuring Cost and Reserve
Restructuring charges	$ 2.7	$ 0.0	$ 9.8	$ 0.3
Restructuring Reserve [Roll Forward]
Severance and other restructuring reserve, beginning balance			0.4
Restructuring charges			37.9
Payments			(4.8)
Restructuring Reserve, Accrual Adjustment			(9.0)
Severance and other restructuring reserve, ending balance	24.5		24.5
Other liabilities
Restructuring Reserve [Roll Forward]
Severance and other restructuring reserve, beginning balance			0.0
Severance and other restructuring reserve, ending balance	17.9		17.9
Severance Pay and Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring charges	30.8	0.0	37.9	0.3
Severance Pay and Benefits
Restructuring Reserve [Roll Forward]
Severance and other restructuring reserve, beginning balance			0.4
Restructuring charges			6.5
Payments			(3.8)
Restructuring Reserve, Accrual Adjustment			(0.1)
Severance and other restructuring reserve, ending balance	3.0		3.0
Contract Termination and Other Costs
Restructuring Reserve [Roll Forward]
Severance and other restructuring reserve, beginning balance			0.0
Restructuring charges			31.4
Payments			(1.0)
Restructuring Reserve, Accrual Adjustment			(8.9)
Severance and other restructuring reserve, ending balance	21.5		21.5
Cost of Goods Sold, Restructuring Charges | Severance Pay and Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring charges	28.1	$ 0.0
Operating Expense | Severance Pay and Contract Termination and Other Costs
Restructuring Cost and Reserve
Restructuring charges	$ 2.7		$ 9.8	$ 0.3

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Restructuring and Related Activities - Balance Sheet Location (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Restructuring Cost and Reserve
Severance and restructuring accrual	$ 24.5	$ 0.4
Other accrued expenses
Restructuring Cost and Reserve
Severance and restructuring accrual	$ 6.6	$ 0.4

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Hedging Transaction and Derivative Instruments - Gain (Loss) of Derivative Instruments Recognized on Income Statement (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Derivative
Cost of goods sold	$ 110.1	$ 136.1	$ 338.5	$ 375.2
Interest expense, net	(1.1)	(4.2)	(2.7)	(12.3)
Other expense (income), net	$ 2.1	$ 1.9	$ 0.9	$ 3.4

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Borrowings (Details) - USD ($) $ / shares in Units, $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Long-term borrowings
Long-term Line of Credit	$ 78.0
Less: current maturities	78.0	$ 70.0
Long-term portion	78.0	$ 70.0
Long-term Debt, Maturities, Repayments of Principal, Remainder of Fiscal Year	0.0
Long-term Debt, Maturities, Repayments of Principal in Year Two	0.0
Long-term Debt, Maturities, Repayments of Principal in Year Three	78.0
Long-term Debt, Maturities, Repayments of Principal in Year Four	0.0
Long-term Debt, Maturities, Repayments of Principal in Year Five	0.0
Debt Instrument, Convertible, Conversion Price		$ 18.4250
Line of Credit | Credit Facility due January 2, 2024 [Member]
Long-term borrowings
Long-term Line of Credit	78.0	$ 70.0
Line of Credit, Current	$ 0.0	$ 0.0

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Borrowings Convertible Debt (Details) $ / shares in Units, $ in Millions	3 Months Ended				9 Months Ended
	Mar. 31, 2022 USD ($) shares	Dec. 31, 2021 $ / shares shares	Sep. 30, 2021 USD ($)	Jun. 30, 2017 USD ($)	Sep. 30, 2022 USD ($) shares	Sep. 30, 2021 USD ($)	May 04, 2016 USD ($) $ / shares
Schedule of Convertible Debt
Debt Instrument, Convertible, Conversion Ratio		54.2741
Debt Instrument, Convertible, Conversion Price | $ / shares		$ 18.4250
Shares Issued During Period, Value, Exercise of Warrants					$ 0.0
Treasury Stock
Schedule of Convertible Debt
Stock Issued During Period, Shares, Conversion of Convertible Securities | shares		400,000
Shares Issued During Period, Shares, Exercise of Warrants | shares	200,000				203,615
Shares Issued During Period, Value, Exercise of Warrants	$ (3.1)				$ (3.1)
Convertible Debt | Convertible Notes Due Twenty Twenty One
Schedule of Convertible Debt
Debt Instrument, Interest Rate, Stated Percentage							3.25%
Debt Instrument, Face Amount							$ 172.5
Interest Expense, Debt, Excluding Amortization			$ 1.4			$ 4.2
Amortization of Debt Issuance Costs			0.2			0.7
Amortization of Debt Discount (Premium)			2.1			6.0
Interest Expense, Debt			$ 3.7			$ 10.9
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares							$ 21.1050
Proceeds from issuance of warrants				$ 39.1

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Borrowings Schedule of Revolving Credit Facility (Details)	9 Months Ended
	Sep. 30, 2022 USD ($)	Sep. 30, 2021	Dec. 31, 2021 USD ($)	Sep. 04, 2020 USD ($)
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Long-term Line of Credit	$ 78,000,000.0
Debt Instrument, Covenant, EBITDA to Interest Ratio, Minimum	3.25
Debt Instrument, Covenant, Debt to EBITDA, Maximum	3.75
Debt Instrument, Covenant, Senior Secured Leverage Ratio, Maximum	3.25
Long-term Debt, Maturities, Repayments of Principal, Remainder of Fiscal Year	$ 0
Long-term Debt, Maturities, Repayments of Principal in Year Two	0
Long-term Debt, Maturities, Repayments of Principal in Year Four	0
Long-term Debt, Maturities, Repayments of Principal in Year Five	0
Shares Issued During Period, Value, Exercise of Warrants	$ 0
Line of Credit | Weighted Average
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Line of Credit Facility, Commitment Fee Percentage	0.23%	0.26%
Credit Facilities | London Interbank Offered Rate (LIBOR)
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Long-term Debt, Weighted Average Interest Rate, at Point in Time	2.62%	0.00%
Credit Facility due January 2, 2024 [Member]
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 400,000,000
Credit Facility due January 2, 2024 [Member] | Minimum [Member]
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Line of Credit Facility, Commitment Fee Percentage	0.225%
Credit Facility due January 2, 2024 [Member] | Minimum [Member] | London Interbank Offered Rate (LIBOR)
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.50%
Credit Facility due January 2, 2024 [Member] | Minimum [Member] | Applicable margin alternate base rate [Member]
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Debt Instrument, Basis Spread on Variable Rate	0.50%
Credit Facility due January 2, 2024 [Member] | Maximum [Member]
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Line of Credit Facility, Commitment Fee Percentage	0.375%
Credit Facility due January 2, 2024 [Member] | Maximum [Member] | London Interbank Offered Rate (LIBOR)
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Debt Instrument, Basis Spread on Variable Rate	2.50%
Credit Facility due January 2, 2024 [Member] | Maximum [Member] | Applicable margin alternate base rate [Member]
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.50%
Credit Facility due January 2, 2024 [Member] | Line of Credit
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Long-term Line of Credit	$ 78,000,000.0		$ 70,000,000.0
Credit Facility due October 11, 2022
Schedule of Term Loan and Revolving Credit Facilities [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity				$ 400,000,000

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Other Comprehensive Loss - OCI (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Foreign currency translation adjustments [Abstract]
Foreign currency translation	$ (13.1)	$ (3.7)	$ (30.9)	$ (6.4)
Foreign currency translation, tax	0.0	0.0	0.0	0.0
Foreign currency translation, net of tax	(13.1)	(3.7)	(30.9)	(6.4)
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, Tax, Attributable to Parent [Abstract]
Other Comprehensive (Income) Loss, Defined Benefit Plan, before Tax, after Reclassification Adjustment, Attributable to Parent	0.2	0.2	0.5	0.6
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, Tax, Attributable to Parent	(0.4)	(0.1)	(0.7)	0.1
Net change in employee benefit plans	(0.2)	0.1	(0.2)	0.7
Total cash flow hedges	(1.3)	(0.1)	(3.8)	(1.9)
Changes in fair value of cash flow hedges:
Changes in fair value of cash flow hedges, before tax	(1.3)	(0.3)	(4.1)	(2.1)
Changes in fair value of cash flow hedges, tax	0.0	0.2	0.3	0.2
Total other comprehensive earnings [Abstract]
Other comprehensive loss, before tax	(14.2)	(3.8)	(34.5)	(7.9)
Other comprehensive loss, tax	(0.4)	0.1	(0.4)	0.3
Other comprehensive loss, net of tax	(14.6)	(3.7)	(34.9)	(7.6)
Net losses (gains) reclassified into earnings	$ 1.7	$ 0.1	$ 2.3	$ (1.4)

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Other Comprehensive Loss - AOCI (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Amortization or settlement of actuarial losses and prior service costs	$ 0.2	$ 0.2	$ 0.5	$ 0.6
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, Tax	0.4	0.1	0.7	(0.1)
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, after Tax	(0.2)	0.1	(0.2)	0.7
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, before Tax	2.0	0.0	2.7	(1.9)
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, Tax	(0.3)	0.1	(0.4)	0.5
Net losses (gains) reclassified into earnings	1.7	0.1	2.3	(1.4)
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Beginning balance			(100.4)	(100.5)
Other comprehensive loss, net of tax	(14.6)	(3.7)	(34.9)	(7.6)
Ending balance	(135.3)	(108.1)	(135.3)	(108.1)
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Beginning balance			0.3	1.6
Other comprehensive loss, net of tax			(3.8)	(1.9)
Ending balance	(3.5)	(0.3)	(3.5)	(0.3)
Employee benefit plans
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Beginning balance			(17.1)	(22.1)
Other comprehensive loss, net of tax			(0.2)	0.7
Ending balance	(17.3)	(21.4)	(17.3)	(21.4)
Cumulative foreign currency translation adjustments
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Beginning balance			(83.6)	(80.0)
Other comprehensive loss, net of tax			(30.9)	(6.4)
Ending balance	$ (114.5)	$ (86.4)	$ (114.5)	$ (86.4)

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Income Taxes (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Tax Holiday [Line Items]
Share-based Payment Arrangement, Expense	$ 6.8	$ 7.1	$ 21.6	$ 25.6
Effective tax rate (benefit) provision	119.90%	14.20%	(5.90%)	13.10%
Income Tax Expense (Benefit)	$ (16.3)	$ 4.6	$ 12.4	$ 8.7
Other expense (income), net	2.1	1.9	0.9	3.4
Effective Income Tax Rate Reconciliation, Discrete Items		$ 0.4	$ (1.6)	$ (0.9)
Effective Tax Rate Excluding Discrete Items		13.00%	6.70%	14.50%
Share-based Payment Arrangement, Expense, Tax Benefit	0.1		$ 4.1	$ 0.0
Foreign Tax Authority
Income Tax Holiday [Line Items]
Effective income tax rate reconciliation, tax holiday	$ (4.0)	$ 3.9	$ 0.9	$ 9.3
Holiday benefit (usd per share)		$ 0.04	$ 0.01	$ 0.10
Income Tax Holiday, Income Tax Expense Per Share	$ (0.04)

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Equity Incentive Program - Stock Options and SSARs (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Expense	$ 6,800,000	$ 7,100,000	$ 21,600,000	$ 25,600,000
SSARs
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount	$ 0		$ 0
Number of Shares [Roll Forward]
Beginning balance			375,964
Granted			0
Exercised			(36,759)
Forfeited			0
Expired			(95,573)
Ending balance	243,632		243,632
Exercised	243,632		243,632
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instrument Other than Options, Expired in Period, Weighted Average Exercise Price			$ 21.77
Weighted Average Grant Date Fair Value
Beginning balance			23.16
Granted			0
Exercised			21.77
Forfeited			0
Ending balance	$ 23.92		23.92
Exercisable	$ 23.92		$ 23.92
SARS and Options, Additional Disclosures
SSARs, aggregate intrinsic value, outstanding	$ 0		$ 0
SSARs, aggregate intrinsic value, exercisable	0		$ 0
SSARs, weighted average remaining contractual terms, outstanding			4 months 24 days
SSARs, weighted average remaining contractual term, exercisable			4 months 24 days
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount	$ 1,700,000		$ 1,700,000
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract]
Risk-free interest rate			0.85%
Dividend yield			0.00%	0.00%
Expected life (years)			4 years 6 months
Volatility			34.30%
Stock Options, Number of Shares
Beginning balance			3,478,438
Granted			216,813
Exercised			(529,199)
Forfeited			(69,873)
Expired			(12,222)
Ending balance	3,083,957		3,083,957
Exercisable	2,582,778		2,582,778
Stock Options, Weighted Average Exercise Price
Beginning balance			$ 15.04
Granted			21.14
Exercised			12.21
Forfeited			20.63
Expired			17.41
Ending balance	$ 15.82		15.82
Exercisable	$ 15.17		$ 15.17
SARS and Options, Additional Disclosures
Options, aggregate intrinsic value, outstanding	$ 700,000		$ 700,000
Options, aggregate intrinsic value, exercisable	$ 700,000		$ 700,000
Options, weighted average remaining contractual term, outstanding			2 years 8 months 12 days
Options, weighted average remaining contractual term, exercisable			2 years 2 months 12 days
Minimum [Member] | Stock Options
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract]
Risk-free interest rate				0.06%
Expected life (years)				4 years 6 months
Volatility				36.00%
Fair value at date of grant			$ 6.29	$ 6.14
Maximum [Member] | Stock Options
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract]
Fair value at date of grant				$ 6.31

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Equity Incentive Program - RSUs (Details) - Restricted Stock Units (RSUs)	9 Months Ended
	Sep. 30, 2022 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition	1 year 9 months 18 days
Number of Shares [Roll Forward]
Beginning balance | shares	1,778,639
Granted | shares	1,203,872
Vested (1) | shares	(817,082)
Forfeited | shares	(243,411)
Ending balance | shares	1,922,018
Weighted Average Grant Date Fair Value
Beginning balance | $ / shares	$ 18.89
Granted | $ / shares	20.55
Vested (1) | $ / shares	18.17
Forfeited | $ / shares	20.15
Ending balance | $ / shares	$ 20.04

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Equity Incentive Program Equity Incentive Program - PSUs (Details) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended
	Mar. 31, 2022 $ / shares shares	Mar. 31, 2021 shares	Sep. 30, 2022 USD ($) $ / shares shares	Sep. 30, 2021 numberOfGrantees	Sep. 30, 2020 numberOfGrantees	Sep. 30, 2019 numberOfGrantees
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount | $			$ 11.8
Number of Shares [Roll Forward]
Beginning balance	766,466		766,466
Granted			294,935
Vested (1)			(227,812)
Forfeited			0
Ending balance			833,589
Weighted Average Grant Date Fair Value
Beginning balance | $ / shares	$ 21.28		$ 21.28
Granted | $ / shares			29.92
Vested (1) | $ / shares			18.44
Forfeited | $ / shares			0
Ending balance | $ / shares			$ 25.12
Performance Shares | 2019
Number of Shares [Roll Forward]
Granted	227,812
Vested (1)	(150,811)
Weighted Average Grant Date Fair Value
Share-based Payment Arrangement, Plan Modification, Number of Grantees Affected | numberOfGrantees					8
Share-based Payment Arrangement, Plan Modification, Incremental Cost | $			$ 2.4
Performance Shares | 2018
Number of Shares [Roll Forward]
Granted		329,092
Vested (1)		(190,544)
Weighted Average Grant Date Fair Value
Share-based Payment Arrangement, Plan Modification, Number of Grantees Affected | numberOfGrantees						9
Share-based Payment Arrangement, Plan Modification, Incremental Cost | $			3.9
Performance Shares | 2020
Weighted Average Grant Date Fair Value
Share-based Payment Arrangement, Plan Modification, Number of Grantees Affected | numberOfGrantees				8
Share-based Payment Arrangement, Plan Modification, Incremental Cost | $			4.7
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount | $			$ 25.3
Number of Shares [Roll Forward]
Beginning balance	1,778,639		1,778,639
Granted			1,203,872
Vested (1)			(817,082)
Forfeited			(243,411)
Ending balance			1,922,018
Weighted Average Grant Date Fair Value
Beginning balance | $ / shares	$ 18.89		$ 18.89
Granted | $ / shares			20.55
Vested (1) | $ / shares			18.17
Forfeited | $ / shares			20.15
Ending balance | $ / shares			$ 20.04

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Equity Incentive Program - Additional Information (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Expense	$ 6,800,000	$ 7,100,000	$ 21,600,000	$ 25,600,000
Share-based Payment Arrangement, Expense, Tax Benefit	100,000		4,100,000	$ 0
SSARs
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount	0		0
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount	1,700,000		$ 1,700,000
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition			1 year 3 months 18 days
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount	25,300,000		$ 25,300,000
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition			1 year 9 months 18 days
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount	$ 11,800,000		$ 11,800,000
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition			1 year 4 months 24 days
Minimum [Member] | Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award
Percentage increase of initial grant value			0.00%
Maximum [Member] | Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award
Percentage increase of initial grant value			225.00%

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Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Reconciliation of information used in computing basic and diluted earnings per share [Abstract]
Earnings (loss) from continuing operations	$ 2.7	$ 27.7	$ (222.1)	$ 57.6
Earnings from discontinued operations, net	0.0	0.0	0.0	0.2
Net earnings (loss)	$ 2.7	$ 27.7	$ (222.1)	$ 57.8
Basic earnings (loss) per common share:
Earnings (loss) from continuing operations, per basic share	$ 0.03	$ 0.30	$ (2.42)	$ 0.62
Earnings from discontinued operations, per basic share	0	0	0	0.01
Net earnings (loss) per share, basic	$ 0.03	$ 0.30	$ (2.42)	$ 0.63
Weighted average shares outstanding	91,400,000	92,200,000	91,900,000	92,300,000
Diluted earnings (loss) per common share:
Net earnings (loss) per share, diluted	$ 0.03	$ 0.29	$ (2.42)	$ 0.61
Diluted (in shares)	92,000,000.0	94,100,000	91,900,000	94,800,000
Earnings (loss) from continuing operations, per diluted share	$ 0.03	$ 0.29	$ (2.42)	$ 0.61
Loss from discontinued operations, net	0	0	0	0
Earnings Per Share, Diluted	$ 0.03	$ 0.29	$ (2.42)	$ 0.61
Diluted (in shares)	92,000,000.0	94,100,000	91,900,000	94,800,000
Share-based Payment Arrangement
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Weighted average number of anti-dilutive shares excluded from the calculation (in shares)	3,200,000	1,100,000	3,000,000.0	1,300,000

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Segment Information (Details) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2022 USD ($) segments	Sep. 30, 2021 USD ($)	Dec. 31, 2021 USD ($)
Segment Reporting Information
Billed Contracts Receivable	$ 118.3		$ 118.3		$ 137.7
Number of reportable segments | segments			2
Assets	1,436.7		$ 1,436.7		1,731.6
Revenues	178.2	$ 233.0	567.6	$ 633.8
Reconciliation of Net Earnings from Segments [Abstract]
Interest expense, net	1.1	4.2	2.7	12.3
(Loss) earnings before income taxes and discontinued operations	(13.6)	32.3	(209.7)	66.3
(Benefit from) provision for income taxes	(16.3)	4.6	12.4	8.7
Earnings (loss) from continuing operations	2.7	27.7	(222.1)	57.6
Asia
Segment Reporting Information
Revenues	105.3	163.4	347.2	452.0
United States
Segment Reporting Information
Revenues	43.7	42.2	129.3	109.3
Europe
Segment Reporting Information
Revenues	24.5	24.6	80.2	65.4
Other Americas
Segment Reporting Information
Revenues	2.9	1.6	5.5	3.9
Other Geographical Locations
Segment Reporting Information
Revenues	1.8	1.2	5.4	3.2
Operating Segments
Reconciliation of Net Earnings from Segments [Abstract]
Earnings (loss) before interest and income taxes	(0.7)	50.6	(171.4)	123.3
Operating Segments | Audio
Segment Reporting Information
Assets	1,149.2		1,149.2		1,467.1
Revenues	113.8	177.7	388.0	490.6
Reconciliation of Net Earnings from Segments [Abstract]
Earnings (loss) before interest and income taxes	(16.9)	36.6	(210.9)	95.0
Operating Segments | Precision Devices
Segment Reporting Information
Assets	285.2		285.2		260.4
Revenues	64.4	55.3	179.6	143.2
Reconciliation of Net Earnings from Segments [Abstract]
Earnings (loss) before interest and income taxes	16.2	14.0	39.5	28.3
Corporate, Non-Segment [Member]
Segment Reporting Information
Assets	2.3		2.3		$ 4.1
Reconciliation of Net Earnings from Segments [Abstract]
Corporate expense / other	11.8	14.1	35.6	44.7
Interest expense, net	$ 1.1	$ 4.2	$ 2.7	$ 12.3

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Impairment Charges (Details) - USD ($) $ in Millions	3 Months Ended			9 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021	Mar. 31, 2020
Unusual or Infrequent Item, or Both [Line Items]
Asset Impairment Charges	$ 0.0	$ 239.8	$ 4.0	$ 239.8	$ 4.0
Operating Lease, Right-of-Use Asset	$ 13.6			$ 13.6		$ 17.4
Mountain View, California
Unusual or Infrequent Item, or Both [Line Items]
Asset Impairment Charges			3.2
Santa Clara, California
Unusual or Infrequent Item, or Both [Line Items]
Asset Impairment Charges			$ 0.8
Operating Lease, Liability							$ 4.0
Operating Lease, Right-of-Use Asset							$ 2.4

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Label	Element	Value
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents, Including Disposal Group and Discontinued Operations	us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsIncludingDisposalGroupAndDiscontinuedOperations	$ 68,900,000
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents, Including Disposal Group and Discontinued Operations	us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsIncludingDisposalGroupAndDiscontinuedOperations	$ 147,800,000