Income Taxes

3 Months Ended

Mar. 31, 2026

Income Taxes

Income Taxes

Note 6—Income Taxes

	Three Months Ended
	March 31,
	2026			2025
Provision for income taxes	$	(702.4)		$	(218.7)
Effective tax rate		42.7	%		22.7	%

For the three months ended March 31, 2026 and 2025, stock option exercise activity had the impact of decreasing our Provision for income taxes by $50.9 and $20.1, respectively, and decreasing our effective tax rate by approximately 310 basis points and 210 basis points, respectively, due to the recognition of excess tax benefits within Provision for income taxes in the accompanying Condensed Consolidated Statements of Income. Acquisition-related expenses, as discussed in further detail in Note 11 herein, had the aggregate impact of increasing our effective tax rate by approximately 120 basis points and 30 basis points for the three months ended March 31, 2026 and 2025, respectively. In addition, for the three months ended March 31, 2026, the Company recorded an accrual of $130.0 resulting from unfavorable determinations received from relevant tax authorities in China regarding the previously disclosed tax inquiries into certain of the Company’s prior period tax positions, as well as $160.0 in additional tax obligations related to China resulting from the Company’s reassessment of certain tax rate assumptions applied to prior years’ results not subject to the tax inquiries as further discussed below. These accruals had the effect of increasing our effective tax rate by approximately 1,760 basis points.

The Company operates in the U.S. and numerous foreign taxable jurisdictions, and at any point in time has numerous audits underway at various stages of completion. With few exceptions, the Company is subject to income tax examinations by tax authorities for the years 2017 and after. The Company is generally not able to precisely estimate the ultimate settlement amounts or timing until the close of an audit. The Company evaluates its tax positions and establishes liabilities for uncertain tax positions that may be challenged by tax authorities and may not be fully sustained, despite the Company’s belief that the underlying tax positions are fully supportable. As of March 31, 2026, the amount of unrecognized tax benefits, including penalties and interest, which if recognized would impact the effective tax rate, was approximately $571.5. Unrecognized tax benefits are reviewed on an ongoing basis and are adjusted for changing facts and circumstances, including the progress of tax audits and the closing of statutes of limitations. Based on information currently available, management anticipates that over the next 12-month period, audit activity could be completed and statutes of limitations may close relating to existing unrecognized tax benefits of approximately $239.5.

In connection with the previously disclosed tax matter in China, the Company received unfavorable determinations from the relevant tax authorities regarding certain of the Company’s prior period tax positions. As a result of these unfavorable determinations, the Company received tax payment notices totaling $230.0. To fully accrue for this amount, the Company recorded an accrual of $130.0 during the three months ended March 31, 2026, which was in addition to the accrual of $100.0 recorded in the three months ended December 31, 2025. In addition, the recent developments of the China tax matter also resulted in the Company reassessing certain tax rate assumptions applied to prior years’ results not subject to the China tax inquiries. This reassessment resulted in the Company recording $160.0 of additional tax obligations in the three months ended March 31, 2026.

Inflation Reduction Act of 2022

On August 16, 2022, the Inflation Reduction Act of 2022 (the “IRA”), a tax and spending package that introduced several tax-related provisions, including a 15% corporate alternative minimum tax (“CAMT”) on certain large corporations and a 1% excise tax on certain corporate stock repurchases, was enacted into law. Companies were required to reassess their valuation allowances for certain affected deferred tax assets in the period of enactment but did not need to remeasure deferred tax balances for the related tax accounting implications of the CAMT. The IRA provisions, which became effective for Amphenol beginning on January 1, 2023, did not have a material impact on the Company during the three months ended March 31, 2026 and 2025. While the full impact of these provisions in the future depends on several factors, including interpretive regulatory guidance, which has not yet been released, the Company does not currently believe that the provisions of the IRA, including several other non-tax related provisions, will have a material impact on its financial condition, results of operations, liquidity and cash flows.

H.R. 1

On July 4, 2025, the United States federal government enacted the tax and spending bill H.R. 1. This legislation contains changes to previously enacted provisions of the Internal Revenue Code and provides for extensions of certain expiring tax provisions included in the Tax Cuts and Jobs Act. Certain corporate tax provisions in H.R. 1 were enacted with retroactive effect to January 1, 2025. H.R. 1 did not have a material impact on our effective tax rate for the three months ended March 31, 2026. The Company continues to evaluate the corporate tax provisions contained within H.R. 1, and the future impact of H.R. 1 depends on several factors, including interpretive regulatory guidance, which has not yet been released.