Overview This discussion of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and notes thereto included herein. The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates if different assumptions were used or different events ultimately transpire. Our critical accounting policies, which require management to make judgments about matters that are inherently uncertain, are described in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the heading “Critical Accounting Estimates” in our Annual Report on Form 10-K for the year ended October 31, 2025. There have been no material changes to our critical accounting policies during the nine months ended July 31, 2026. Our business is comprised of two operating segments: the Flight Support Group (“FSG”), consisting of HEICO Aerospace Holdings Corp. and HEICO Flight Support Corp. and their respective subsidiaries; and the Electronic Technologies Group (“ETG”), consisting of HEICO Electronic Technologies Corp. and its subsidiaries. Our results of operations for the nine and three months ended July 31, 2026 have been affected by the fiscal 2025 acquisitions as further detailed in Note 2, Acquisitions, of the Notes to Consolidated Financial Statements of our Annual Report on Form 10-K for the year ended October 31, 2025 and the fiscal 2026 acquisitions as further detailed in Note 2, Acquisitions, of the Notes to the Condensed Consolidated Financial Statements of this quarterly report. 31 Index Results of Operations The following table sets forth the results of our operations, net sales and operating income by segment and the percentage of net sales represented by the respective items in our Condensed Consolidated Statements of Operations (in thousands): Nine months ended July 31, Three months ended July 31, 2026 2025 2026 2025 Net sales $3,967,345 $3,275,633 $1,413,050 $1,147,591 Cost of sales 2,361,869 1,975,010 832,063 690,434 Selling, general and administrative expenses 639,943 560,647 225,790 192,138 Total operating costs and expenses 3,001,812 2,535,657 1,057,853 882,572 Operating income $965,533 $739,976 $355,197 $265,019 Net sales by segment: Flight Support Group $2,697,230 $2,282,905 $947,803 $802,661 Electronic Technologies Group 1,313,694 1,028,345 483,487 355,863 Intersegment sales (43,579) (35,617) (18,240) (10,933) $3,967,345 $3,275,633 $1,413,050 $1,147,591 Operating income by segment: Flight Support Group $689,096 $549,422 $245,299 $198,326 Electronic Technologies Group 320,620 235,334 125,565 80,998 Other, primarily corporate (44,183) (44,780) (15,667) (14,305) $965,533 $739,976 $355,197 $265,019 Net sales 100.0 % 100.0 % 100.0 % 100.0 % Gross profit 40.5 % 39.7 % 41.1 % 39.8 % Selling, general and administrative expenses 16.1 % 17.1 % 16.0 % 16.7 % Operating income 24.3 % 22.6 % 25.1 % 23.1 % Interest expense (2.5 %) (3.0 %) (2.5 %) (2.8 %) Other income .1 % .1 % .1 % .1 % Income tax expense 4.0 % 3.2 % 4.7 % 3.9 % Net income attributable to noncontrolling interests 1.3 % 1.2 % 1.3 % 1.2 % Net income attributable to HEICO 16.6 % 15.3 % 16.7 % 15.5 % 32 Index Comparison of First Nine Months of Fiscal 2026 to First Nine Months of Fiscal 2025 Net Sales Our consolidated net sales in the first nine months of fiscal 2026 increased by 21% to a record $3,967.3 million, up from net sales of $3,275.6 million in the first nine months of fiscal 2025. The increase in consolidated net sales principally reflects an increase of $414.3 million (an 18% increase) to a record $2,697.2 million in net sales of the FSG and an increase of $285.3 million (a 28% increase) to a record $1,313.7 million in net sales of the ETG. The net sales increase in the FSG reflects robust organic growth of 15% and net sales of $81.9 million contributed by fiscal 2026 and 2025 acquisitions. The FSG's organic net sales growth reflects increased demand within its aftermarket replacement parts, repair and overhaul parts and services, and specialty products product lines resulting in net sales increases of $234.0 million, $50.7 million, and $46.4 million, respectively. The net sales increase in the ETG reflects very strong organic growth of 14% and net sales of $140.1 million contributed by fiscal 2026 and 2025 acquisitions. The ETG's organic net sales growth is mainly attributable to increased demand for its other electronics, defense, aerospace, and medical products resulting in net sales increases of $60.0 million, $36.3 million, $31.1 million, and $7.0 million, respectively. Sales price changes were not a significant contributing factor to the change in net sales of the FSG and ETG in the first nine months of fiscal 2026. Gross Profit and Operating Expenses Our consolidated gross profit margin improved to 40.5% in the first nine months of fiscal 2026, up from 39.7% in the first nine months of fiscal 2025, principally reflecting a .7% increase in the FSG’s gross profit margin and a .4% increase in the ETG’s gross profit margin. The increase in the FSG's gross profit margin principally reflects a more favorable product mix within its aftermarket replacement parts product line. The increase in the ETG's gross profit margin principally reflects the previously mentioned higher net sales of its aerospace products, partially offset by a lower proportion of net sales from its space products. Total new product research and development expenses included within our consolidated cost of sales were $104.5 million in the first nine months of fiscal 2026, up from $88.3 million in the first nine months of fiscal 2025. Our consolidated selling, general and administrative ("SG&A") expenses were $639.9 million in the first nine months of fiscal 2026, as compared to $560.6 million in the first nine months of fiscal 2025. The increase in consolidated SG&A expenses reflects $36.1 million attributable to our fiscal 2026 and 2025 acquisitions, a $15.6 million increase in share-based compensation expense, and costs incurred to support the previously mentioned net sales growth, which resulted in increases of $17.9 million and $9.8 million in other selling expenses and other general and administrative expenses, respectively. Our consolidated SG&A expenses as a percentage of net sales improved to 16.1% in the first nine months of fiscal 2026, down from 17.1% in the first nine months of fiscal 2025. The 33 Index decrease in consolidated SG&A expenses as a percentage of net sales principally reflects efficiencies realized from the previously mentioned net sales growth. Operating Income Our consolidated operating income increased by 30% to a record $965.5 million in the first nine months of fiscal 2026, up from $740.0 million in the first nine months of fiscal 2025. The increase in consolidated operating income principally reflects a $139.7 million increase (a 25% increase) to a record $689.1 million in operating income of the FSG and an $85.3 million increase (a 36% increase) to a record $320.6 million in operating income of the ETG. The increase in operating income of the FSG principally reflects the previously mentioned net sales growth, the previously mentioned improved gross profit margin, and SG&A expense efficiencies realized from the net sales growth. The increase in operating income of the ETG principally reflects the previously mentioned net sales growth, SG&A expense efficiencies realized from the net sales growth, and the previously mentioned improved gross profit margin. Our consolidated operating income as a percentage of net sales improved to 24.3% in the first nine months of fiscal 2026, up from 22.6% in the first nine months of fiscal 2025. The increase in consolidated operating income as a percentage of net sales principally reflects an increase in the FSG’s operating income as a percentage of net sales to 25.5% in the first nine months of fiscal 2026, up from 24.1% in the first nine months of fiscal 2025, and an increase in the ETG's operating income as a percentage of net sales to 24.4% in the first nine months of fiscal 2026, up from 22.9% in the first nine months of fiscal 2025. The increase in the FSG's operating income as a percentage of net sales reflects the previously mentioned improved gross profit margin and a .7% impact from a decrease in SG&A expenses as a percentage of net sales, mainly due to the previously mentioned SG&A expense efficiencies. The increase in the ETG's operating income as a percentage of net sales reflects a 1.1% impact from a decrease in SG&A expenses as a percentage of net sales, mainly due to the previously mentioned SG&A expense efficiencies, and the previously mentioned improved gross profit margin. Interest Expense Interest expense was $99.6 million in the first nine months of fiscal 2026, as compared to $97.0 million in the first nine months of fiscal 2025. The increase in interest expense was principally due to an increase in the amount of debt outstanding, partially offset by a lower weighted-average interest rate on outstanding borrowings under our revolving credit facility ("Credit Facility"). Other Income Other income in the first nine months of fiscal 2026 and 2025 was not material. Income Tax Expense Our effective tax rate was 18.4% in the first nine months of fiscal 2026, as compared to 34 Index 16.0% in the first nine months of fiscal 2025. The increase in our effective tax rate principally reflects a smaller tax benefit from stock option exercises recognized in the first quarter of fiscal 2026. We recognized a discrete tax benefit from stock option exercises in the first quarter of fiscal 2026 and 2025 of $22.3 million and $27.2 million, respectively. Net Income Attributable to Noncontrolling Interests Net income attributable to noncontrolling interests relates to the 20% noncontrolling interest held by Lufthansa Technik AG in HEICO Aerospace Holdings Corp. and the noncontrolling interests held by others in certain subsidiaries of the FSG and ETG. Net income attributable to noncontrolling interests was $50.1 million in the first nine months of fiscal 2026, as compared to $40.7 million in the first nine months of fiscal 2025. The increase in net income attributable to noncontrolling interests principally reflects improved operating results of certain subsidiaries in which noncontrolling interests are held. Net Income Attributable to HEICO Net income attributable to HEICO increased by 31% to a record $659.4 million, or $4.67 per diluted share, in the first nine months of fiscal 2026, up from $502.1 million, or $3.57 per diluted share, in the first nine months of fiscal 2025, principally reflecting the previously mentioned higher consolidated operating income. Comparison of Third Quarter of Fiscal 2026 to Third Quarter of Fiscal 2025 Net Sales Our consolidated net sales in the third quarter of fiscal 2026 increased by 23% to a record $1,413.1 million, up from net sales of $1,147.6 million in the third quarter of fiscal 2025. The increase in consolidated net sales principally reflects an increase of $145.1 million (an 18% increase) to a record $947.8 million in net sales of the FSG and an increase of $127.6 million (a 36% increase) to a record $483.5 million in net sales of the ETG. The net sales increase in the FSG reflects strong organic growth of 12% and net sales of $45.8 million contributed by fiscal 2026 acquisitions. The FSG's organic net sales growth reflects increased demand within its aftermarket replacement parts, specialty products, and repair and overhaul parts and services product lines resulting in net sales increases of $72.1 million, $15.9 million, and $10.4 million, respectively. The net sales increase in the ETG reflects robust organic growth of 18% and net sales of $60.2 million contributed by fiscal 2026 and 2025 acquisitions. The ETG's organic net sales growth is mainly attributable to increased demand for its other electronics, defense, and aerospace products resulting in net sales increases of $29.3 million, $16.3 million, and $9.3 million, respectively. Sales price changes were not a significant contributing factor to the change in net sales of the FSG and ETG in the third quarter of fiscal 2026. 35 Index Gross Profit and Operating Expenses Our consolidated gross profit margin improved to 41.1% in the third quarter of fiscal 2026, up from 39.8% in the third quarter of fiscal 2025, principally reflecting a 1.0% increase in the FSG’s gross profit margin and a .9% increase in the ETG's gross profit margin. The increase in the FSG's gross profit margin principally reflects a more favorable product mix within its specialty products and aftermarket replacement parts product lines. The increase in the ETG's gross profit margin principally reflects the previously mentioned higher net sales of its aerospace products. Total new product research and development expenses included within our consolidated cost of sales were $36.1 million in the third quarter of fiscal 2026, up from $31.9 million in the third quarter of fiscal 2025. Our consolidated SG&A expenses were $225.8 million in the third quarter of fiscal 2026, as compared to $192.1 million in the third quarter of fiscal 2025. The increase in consolidated SG&A expenses reflects $16.8 million attributable to our fiscal 2026 and 2025 acquisitions, $4.3 million of higher share-based compensation expense, and costs incurred to support the previously mentioned net sales growth, which resulted in increases of $6.6 million and $6.1 million in other general and administrative expenses and other selling expenses, respectively. Our consolidated SG&A expenses as a percentage of net sales improved to 16.0% in the third quarter of fiscal 2026, down from 16.7% in the third quarter of fiscal 2025. The decrease in consolidated SG&A expenses as a percentage of net sales principally reflects efficiencies realized from the previously mentioned net sales growth. Operating Income Our consolidated operating income increased by 34% to a record $355.2 million in the third quarter of fiscal 2026, up from $265.0 million in the third quarter of fiscal 2025. The increase in consolidated operating income principally reflects a $47.0 million increase (a 24% increase) to a record $245.3 million in operating income of the FSG and a $44.6 million increase (a 55% increase) to a record $125.6 million in operating income of the ETG. The increase in operating income of the FSG principally reflects the previously mentioned net sales growth, the previously mentioned improved gross profit margin, and SG&A expense efficiencies realized from the net sales growth. The increase in operating income of the ETG principally reflects the previously mentioned net sales growth, SG&A expense efficiencies realized from the net sales growth, and the previously mentioned improved gross profit margin. Our consolidated operating income as a percentage of net sales improved to 25.1% in the third quarter of fiscal 2026, up from 23.1% in the third quarter of fiscal 2025. The increase in consolidated operating income as a percentage of net sales principally reflects an increase in the ETG’s operating income as a percentage of net sales to 26.0% in the third quarter of fiscal 2026, up from 22.8% in the third quarter of fiscal 2025, and an increase in the FSG's operating income as a percentage of net sales to 25.9% in the third quarter of fiscal 2026, up from 24.7% in the third quarter of fiscal 2025. The increase in the ETG's operating income as a percentage of net sales reflects a 2.3% impact from a decrease in SG&A expenses as a percentage of net sales, 36 Index primarily driven by the previously mentioned SG&A expense efficiencies and the previously mentioned improved gross profit margin. The increase in the FSG's operating income as a percentage of net sales principally reflects the previously mentioned improved gross profit margin. Interest Expense Interest expense was $35.9 million in the third quarter of fiscal 2026, as compared to $31.7 million in the third quarter of fiscal 2025. The increase in interest expense was principally due to an increase in the amount of outstanding debt, partially offset by a lower weighted-average interest rate on borrowings outstanding under our Credit Facility. Other Income Other income in the third quarter of fiscal 2026 and 2025 was not material. Income Tax Expense Our effective tax rate was 20.6% in the third quarter of fiscal 2026, as compared to 18.9% in the third quarter of fiscal 2025. The increase in our effective tax rate principally reflects a smaller favorable impact from tax-exempt unrealized gains recognized in the cash surrender values of life insurance policies related to the HEICO Corporation Leadership Compensation Plan (the "LCP") in the third quarter of fiscal 2026 as compared to the third quarter of fiscal 2025. Net Income Attributable to Noncontrolling Interests Net income attributable to noncontrolling interests relates to the 20% noncontrolling interest held by Lufthansa Technik AG in HEICO Aerospace Holdings Corp. and the noncontrolling interests held by others in certain subsidiaries of the FSG and ETG. Net income attributable to noncontrolling interests was $19.0 million in the third quarter of fiscal 2026, as compared to $13.3 million in the third quarter of fiscal 2025. The increase in net income attributable to noncontrolling interests principally reflects improved operating results of certain subsidiaries in which noncontrolling interests are held. Net Income Attributable to HEICO Net income attributable to HEICO increased by 33% to a record $235.4 million, or $1.67 per diluted share, in the third quarter of fiscal 2026, up from $177.3 million, or $1.26 per diluted share, in the third quarter of fiscal 2025, principally reflecting the previously mentioned higher consolidated operating income. 37 Index Outlook For the remainder of fiscal 2026, we expect increased net sales at both the FSG and ETG to continue to be supported by underlying demand for our products and contributions from recent acquisitions. We remain focused on identifying and evaluating acquisition opportunities that align with our strategic objectives. Our capital allocation strategy continues to prioritize investments in organic growth and acquisitions while preserving adequate liquidity and financial flexibility. Liquidity and Capital Resources Our principal uses of cash include acquisitions, interest payments, capital expenditures, cash dividends, distributions to noncontrolling interests and working capital needs. We continue to estimate fiscal 2026 capital expenditures to be approximately $85 to $95 million. We finance our activities primarily from our operating and financing activities, including borrowings under our Credit Facility. The Credit Facility and senior unsecured notes contain both financial and non-financial covenants. As of July 31, 2026, we were in compliance with all such covenants and our total debt to shareholders’ equity ratio was 50.6%. On June 11, 2026, we entered into a fourth amendment to our Credit Facility, to, among other things, (i) increase the capacity by $200 million to $2.2 billion, (ii) extend the maturity date to June 11, 2031, (iii) modify the Applicable Rate to be calculated based upon the most recently published ratings for our senior unsecured, non-credit enhanced, long-term indebtedness for borrowed money, and (iv) release our subsidiary guarantors from their guarantees under the Credit Facility. The Credit Facility includes features that will allow us, subject to certain conditions, to (i) increase the capacity by $800 million to become a $3.0 billion facility through increased commitments from existing and/or additional lenders and (ii) request up to two one-year extensions of the maturity date. Based on our current outlook, we believe that net cash provided by operating activities and available borrowings under our Credit Facility will be sufficient to fund our cash requirements for at least the next twelve months. Operating Activities Net cash provided by operating activities was $815.9 million in the first nine months of fiscal 2026 and consisted primarily of net income from consolidated operations of $709.6 million, depreciation and amortization expense of $166.4 million (a non-cash item), $34.4 million in share-based compensation expense (a non-cash item), $17.9 million in employer contributions to the HEICO Savings and Investment Plan (a non-cash item), net changes in other long-term liabilities and assets related to the LCP of $16.2 million (principally participant deferrals and employer contributions), and net changes of $15.1 million included in the "Other" caption (principally the receipt of advance deposits on certain long-term customer contracts), partially offset by a $154.4 million increase in net working capital. The increase in net working capital is inclusive of a $78.4 million increase in inventories to support an increase in 38 Index consolidated backlog, a $58.7 million increase in accounts receivable resulting from increased net sales and the timing of collections, and a $33.5 million increase in prepaid expenses and other current assets mainly reflecting deposits placed on future inventory deliveries, partially offset by a $47.3 million increase in trade accounts payable due to the timing of payments. Net cash provided by operating activities increased by $177.0 million (a 28% increase) in the first nine months of fiscal 2026, up from $638.9 million in the first nine months of fiscal 2025. The increase is principally attributable to a $166.8 million increase in net income from consolidated operations, a $31.5 million increase in the deferred income tax provision, a $21.5 million increase in depreciation and amortization expense, and a $16.1 million increase in share-based compensation expense, partially offset by a $65.9 million increase in net working capital. The increase in net working capital mainly reflects a $48.4 million increase in prepaid expenses and other current assets principally from increased deposits placed on future inventory deliveries and a $22.7 million increase in accounts receivable resulting from the higher net sales. Investing Activities Net cash used in investing activities totaled $1,072.9 million in the first nine months of fiscal 2026 and related primarily to acquisitions of $1,018.2 million, capital expenditures of $54.1 million, and LCP funding of $19.4 million, partially offset by $22.7 million in proceeds from corporate-owned life insurance policy withdrawals within the LCP. Further details regarding our fiscal 2026 acquisitions may be found in Note 2, Acquisitions, of the Notes to Condensed Consolidated Financial Statements. Financing Activities Net cash provided by financing activities in the first nine months of fiscal 2026 totaled $280.0 million. During the first nine months of fiscal 2026, we received net proceeds of $1,191.5 million from the issuance of senior unsecured notes and borrowed $1,030.7 million under our Credit Facility, which was partially offset by $1,845.7 million in payments made on our Credit Facility, $34.9 million of cash dividends paid on our common stock, $29.3 million of payments to acquire certain noncontrolling interests, and $25.8 million of distributions to noncontrolling interests. Other Obligations and Commitments Except as noted below, there have not been any material changes to our other obligations and commitments that were included in our Annual Report on Form 10-K for the year ended October 31, 2025. On July 16, 2026, we completed the public offering of senior unsecured notes, which consisted of $550 million aggregate principal amount of 4.950% Senior Notes due August 1, 2031 (the "2031 Notes") and $650 million aggregate principal amount of 5.400% Senior Notes due August 1, 2036 (the "2036 Notes"). We used the net proceeds from the offering to repay outstanding borrowings under our Credit Facility. Interest on the 2031 Notes and 2036 Notes is 39 Index payable semi-annually on February 1 and August 1 of each year, commencing February 1, 2027. The 2031 Notes and 2036 Notes have effective interest rates of 5.2% and 5.5%, respectively. See Note 5, Long-Term Debt, to the Condensed Consolidated Financial Statements for additional information. New Accounting Pronouncements See Note 1, Summary of Significant Accounting Policies - New Accounting Pronouncements, of the Notes to Condensed Consolidated Financial Statements for additional information. Forward-Looking Statements Certain statements in this report constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained herein that are not clearly historical in nature may be forward-looking and the words “anticipate,” “believe,” “expect,” “estimate” and similar expressions are generally intended to identify forward-looking statements. Any forward-looking statement contained herein, in press releases, written statements or other documents filed with the Securities and Exchange Commission or in communications and discussions with investors and analysts in the normal course of business through meetings, phone calls and conference calls, concerning our operations, economic performance and financial condition are subject to risks, uncertainties and contingencies. We have based these forward-looking statements on our current expectations and projections about future events. All forward-looking statements involve risks and uncertainties, many of which are beyond our control, which may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements. Also, forward-looking statements are based upon management’s estimates of fair values and of future costs, using currently available information. Therefore, actual results may differ materially from those expressed in or implied by those forward-looking statements. Factors that could cause such differences include, among others: •The severity, magnitude and duration of public health threats; •Our liquidity and the amount and timing of cash generation; •Lower commercial air travel, airline fleet changes or airline purchasing decisions, which could cause lower demand for our goods and services; •Product specification costs and requirements, which could cause an increase to our costs to complete contracts; •Governmental and regulatory demands, export policies and restrictions, reductions in defense, space or homeland security spending by U.S. and/or foreign customers or competition from existing and new competitors, which could reduce our sales; 40 Index •Our ability to introduce new products and services at profitable pricing levels, which could reduce our sales or sales growth; •Product development or manufacturing difficulties, which could increase our product development and manufacturing costs and delay sales; •Cybersecurity events or other disruptions of our information technology systems could adversely affect our business; and •Our ability to make acquisitions, including obtaining any applicable domestic and/or foreign governmental approvals, and achieve operating synergies from acquired businesses; customer credit risk; interest, foreign currency exchange and income tax rates; and economic conditions, including the effects of inflation, within and outside of the aviation, defense, space, medical, telecommunications and electronics industries, which could negatively impact our costs and revenues. For further information on these and other factors that potentially could materially affect our financial results, see Item 1A, "Risk Factors," of our Annual Report on Form 10-K for the year ended October 31, 2025. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except to the extent required by applicable law. 41 Index