(Former name, former address and former fiscal year, if changed since last report)

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 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, 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.

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 Securities Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

At ~~March 6,~~September 5, 2023, the registrant had ~~35,985,712~~36,009,532 shares of common stock outstanding.


	Three Months Ended					Nine Months Ended						Three Months Ended
	January 28, 2023		January 29, 2022			January 28, 2023			January 29, 2022			July 29, 2023		July 30, 2022
Net sales	$	280.1	$	291.6		$	878.4		$	874.9		$	289.7	$	282.4

Cost of products sold		215.2		222.5			677.6			664.9			235.7		220.6

Gross profit		64.9		69.1			200.8			210.0			54.0		61.8

Selling and administrative expenses		32.9		34.5			104.8			98.5			44.5		35.3
Amortization of intangibles		4.7		4.8			14.1			14.4			5.7		4.7

Income from operations		27.3		29.8			81.9			97.1			3.8		21.8

Interest expense, net		0.8		0.7			1.3			2.9			2.8		—
Other expense (income), net		3.5		(4.4	)		(1.7	)		(7.1	)
Other income, net													—		(4.1	)

Pre-tax income		23.0		33.5			82.3			101.3			1.0		25.9

Income tax expense		3.1		4.1			13.3			15.3			0.1		4.4
Net income													0.9		21.5
Net income attributable to redeemable noncontrolling interest													—		—

Net income	$	19.9	$	29.4		$	69.0		$	86.0
Net income attributable to Methode												$	0.9	$	21.5

Basic and diluted income per share:
Basic and diluted income per share attributable to Methode:
Basic	$	0.56	$	0.80		$	1.91		$	2.30		$	0.03	$	0.59
Diluted	$	0.54	$	0.78		$	1.87		$	2.26		$	0.02	$	0.58

Cash dividends per share	$	0.14	$	0.14		$	0.42		$	0.42		$	0.14	$	0.14


	January 28, 2023			April 30, 2022			July 29, 2023			April 29, 2023
	(unaudited)						(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	164.7		$	172.0		$	147.9		$	157.0
Accounts receivable, net		295.5			273.3			300.8			314.3
Inventories		175.4			158.5			175.6			159.7
Income tax receivable		7.5			8.3			13.4			12.9
Prepaid expenses and other current assets		27.9			16.9			19.8			20.5
Total current assets		671.0			629.0			657.5			664.4
Long-term assets:
Property, plant and equipment, net		200.7			197.0			225.2			220.3
Goodwill		232.5			233.0			302.5			301.9
Other intangible assets, net		193.3			207.7			251.3			256.7
Operating lease right-of-use assets, net		29.4			20.0			29.5			28.4
Deferred tax assets		37.6			36.8			33.7			33.6
Pre-production costs		30.8			27.2			38.9			36.1
Other long-term assets		33.2			38.4			35.5			37.7
Total long-term assets		757.5			760.1			916.6			914.7
Total assets	$	1,428.5		$	1,389.1		$	1,574.1		$	1,579.1

LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	113.1		$	108.5		$	131.9		$	138.7
Accrued employee liabilities		29.4			30.0			26.7			36.7
Other accrued liabilities		33.3			24.5			33.7			34.5
Short-term operating lease liabilities		6.8			6.0			6.9			6.8
Short-term debt		0.5			13.0			3.2			3.2
Income tax payable		7.8			6.6			6.0			8.1
Total current liabilities		190.9			188.6			208.4			228.0
Long-term liabilities:
Long-term debt		200.8			197.5			335.8			303.6
Long-term operating lease liabilities		23.0			14.8			22.4			21.8
Long-term income tax payable		16.7			22.1			16.7			16.7
Other long-term liabilities		16.0			14.0			17.1			14.3
Deferred tax liabilities		38.5			38.3			41.4			41.8
Total long-term liabilities		295.0			286.7			433.4			398.2
Total liabilities		485.9			475.3			641.8			626.2
Redeemable noncontrolling interest								0.9			11.1
Shareholders' equity:
Common stock, $0.50 par value, 100,000,000 shares authorized, 37,375,097 shares and 38,276,968 shares issued as of January 28, 2023 and April 30, 2022, respectively		18.6			19.2
Common stock, $0.50 par value, 100,000,000 shares authorized, 37,356,156 shares and 37,167,375 shares issued as of July 29, 2023 and April 29, 2023, respectively								18.7			18.6
Additional paid-in capital		178.9			169.0			182.5			181.0
Accumulated other comprehensive loss		(21.6	)		(26.8	)		(23.1	)		(19.0	)
Treasury stock, 1,346,624 shares as of January 28, 2023 and April 30, 2022		(11.5	)		(11.5	)
Treasury stock, 1,346,624 shares as of July 29, 2023 and April 29, 2023								(11.5	)		(11.5	)
Retained earnings		778.2			763.9			764.8			772.7
Total shareholders' equity		942.6			913.8			931.4			941.8
Total liabilities and shareholders' equity	$	1,428.5		$	1,389.1
Total liabilities, redeemable noncontrolling interest and shareholders' equity							$	1,574.1		$	1,579.1


	Three Months Ended January 29, 2022																						Three Months Ended July 30, 2022
	Common stock shares			Common stock			Additional paid-in capital		Accumulated other comprehensive income (loss)			Treasury stock			Retained earnings			Total shareholders' equity			Redeemable noncontrolling interest		Common stock shares			Common stock			Additional paid-in capital		Accumulated other comprehensive income (loss)			Treasury stock			Retained earnings			Total shareholders' equity
Balance as of October 30, 2021		38,737,129		$	19.4		$	163.8	$	(2.0	)	$	(11.5	)	$	749.8		$	919.5
Balance as of April 30, 2022																					$	—		38,276,968		$	19.2		$	169.0	$	(26.8	)	$	(11.5	)	$	763.9		$	913.8
Issuance of restricted stock, net of tax withholding																						—		42,381			—			—		—			—			(0.4	)		(0.4	)
Purchases of common stock		(460,161	)		(0.2	)		—		—			—			(21.1	)		(21.3	)		—		(317,635	)		(0.2	)		—		—			—			(11.7	)		(11.9	)
Stock-based compensation expense		—			—			2.6		—			—			—			2.6			—		—			—			3.0		—			—			—			3.0
Other comprehensive loss		—			—			—		(8.6	)		—			—			(8.6	)		—		—			—			—		(9.4	)		—			—			(9.4	)
Net income		—			—			—		—			—			29.4			29.4			—		—			—			—		—			—			21.5			21.5
Dividends on common stock		—			—			—		—			—			(5.2	)		(5.2	)		—		—			—			—		—			—			(5.2	)		(5.2	)
Balance as of January 29, 2022		38,276,968		$	19.2		$	166.4	$	(10.6	)	$	(11.5	)	$	752.9		$	916.4
Balance as of July 30, 2022																					$	—		38,001,714		$	19.0		$	172.0	$	(36.2	)	$	(11.5	)	$	768.1		$	911.4

~~CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (Unaudited) (continued)~~

Note 2. Revenue

The Company generates revenue from ~~the~~ manufacturing of products for customers in diversified global markets. The substantial majority of the Company’s revenue is recognized at a point in time. The Company has determined that the most definitive demonstration that control ~~of the product~~ has transferred to a customer is physical shipment or delivery, depending on the contractual shipping terms, except for consignment transactions. Consignment transactions are arrangements where the Company transfers product to a customer location but retains ownership and control of ~~the~~such product until it is used by the customer. Revenue for consignment arrangements is recognized upon the customer’s usage.

Revenue associated with products which the Company believes have no alternative use (such as highly customized parts), and where the Company has an enforceable right to payment, are recognized on an over time basis. Revenue is recognized based on progress to date, which is typically even over the production process through transfer of control to the customer.

From time to time, customers may negotiate annual price downs. Management has evaluated these price downs and determined that in some instances, these price downs give rise to a material right. In instances that a material right exists, a portion of the transaction price is allocated to the material right and recognized over the life of the contract.

Across all products, the amount of revenue recognized corresponds to the related purchase order and is adjusted for variable consideration (such as discounts) and ongoing price adjustments. Sales and other taxes collected concurrent with revenue-producing activities are excluded from revenue.

The Company’s performance obligations are typically short-term in nature. As a result, the Company has elected the practical expedient that provides an exemption from the disclosure requirements regarding information about remaining performance obligations on contracts that have original expected durations of one year or less.

Contract balances

A contract asset is an entity’s right to consideration in exchange for goods or services that the entity has transferred to a customer. A contract liability exists when an entity has received consideration, or the amount is due from the customer in advance of revenue recognition. The net changes in the contract asset and contract liability balances for the ~~nine~~three months ended ~~January 28,~~July 29, 2023 and ~~January 29,~~July 30, 2022 were not material.

~~Table of Contents~~

Disaggregated revenue information

The following table represents a disaggregation of revenue from contracts with customers by segment and geographical location. Net sales are attributed to regions based on the location of production. Though revenue recognition patterns and contracts are generally consistent, the amount, timing and uncertainty of revenue and cash flows may vary in each reportable segment due to geographic and economic factors.


	Three Months Ended January 28, 2023										Three Months Ended July 29, 2023
(in millions)	Automotive		Industrial		Interface		Medical		Total		Automotive		Industrial		Interface		Medical		Total
Geographic net sales:
North America	$	82.9	$	37.2	$	11.9	$	0.6	$	132.6	$	66.8	$	40.0	$	15.2	$	0.8	$	122.8
Europe, the Middle East & Africa ("EMEA")		56.3		34.1		—		—		90.4		52.2		51.1		—		—		103.3
Asia		37.3		19.7		0.1		—		57.1		39.3		24.3		—		—		63.6
Total net sales	$	176.5	$	91.0	$	12.0	$	0.6	$	280.1	$	158.3	$	115.4	$	15.2	$	0.8	$	289.7
Timing of revenue recognition:
Goods transferred at a point in time	$	171.3	$	91.0	$	12.0	$	0.6	$	274.9	$	154.2	$	115.4	$	15.2	$	0.8	$	285.6
Goods transferred over time		5.2		—		—		—		5.2		4.1		—		—		—		4.1
Total net sales	$	176.5	$	91.0	$	12.0	$	0.6	$	280.1	$	158.3	$	115.4	$	15.2	$	0.8	$	289.7

Three Months Ended January 29, 2022

(in millions)

Automotive

Industrial

Interface

Medical

Total

Geographic net sales:

North America

$
103.7

$
46.9

$
15.1

$
1.0

$
166.7

EMEA

44.0

17.2

—

—

61.2

Asia

47.7

15.9

0.1

—

63.7

Total net sales

$
195.4

$
80.0

$
15.2

$
1.0

$
291.6

Timing of revenue recognition:

Goods transferred at a point in time

$
189.0

$
80.0

$
15.2

$
1.0

$
285.2

Goods transferred over time

6.4

—

—

—

6.4

Total net sales

$
195.4

$
80.0

$
15.2

$
1.0

$
291.6

Nine Months Ended January 28, 2023

(in millions)

Automotive

Industrial

Interface

Medical

Total

Geographic net sales:

North America

$
275.4

$
118.0

$
38.9

$
2.4

$
434.7

EMEA

162.3

100.5

—

—

262.8

Asia

112.3

68.4

0.2

—

180.9

Total net sales

$
550.0

$
286.9

$
39.1

$
2.4

$
878.4

Timing of revenue recognition:

Goods transferred at a point in time

$
535.7

$
286.9

$
39.1

$
2.4

$
864.1

Goods transferred over time

14.3

—

—

—

14.3

Total net sales

$
550.0

$
286.9

$
39.1

$
2.4

$
878.4

Nine Months Ended January 29, 2022

(in millions)

Automotive

Industrial

Interface

Medical

Total

Geographic net sales:

North America

$
302.1

$
131.4

$
45.4

$
2.6

$
481.5

EMEA

156.7

60.4

—

—

217.1

Asia

128.4

47.4

0.5

—

176.3

Total net sales

$
587.2

$
239.2

$
45.9

$
2.6

$
874.9

Timing of revenue recognition:

Goods transferred at a point in time

$
567.9

$
239.2

$
45.9

$
2.6

$
855.6

Goods transferred over time

19.3

—

—

—

19.3

Total net sales

$
587.2

$
239.2

$
45.9

$
2.6

$
874.9


	Three Months Ended July 30, 2022
(in millions)	Automotive		Industrial		Interface		Medical		Total
Geographic net sales:
North America	$	94.7	$	40.7	$	13.0	$	0.7	$	149.1
EMEA		52.1		28.5		—		—		80.6
Asia		29.8		22.9		—		—		52.7
Total net sales	$	176.6	$	92.1	$	13.0	$	0.7	$	282.4
Timing of revenue recognition:
Goods transferred at a point in time	$	172.1	$	92.1	$	13.0	$	0.7	$	277.9
Goods transferred over time		4.5		—		—		—		4.5
Total net sales	$	176.6	$	92.1	$	13.0	$	0.7	$	282.4

118

Table of Contents

Depreciation expense was $~~7.6~~8.3 million and $~~8.9~~7.6 million in the three months ended ~~January 28,~~July 29, 2023 and ~~January 29, 2022, respectively. Depreciation expense was $22.7~~ ~~million and $25.2~~ ~~million in the nine months ended January 28, 2023 and January 29,~~July 30, 2022, respectively. As of ~~January 28,~~July 29, 2023 and April ~~30, 2022,~~29, 2023, capital expenditures recorded in accounts payable totaled $~~2.0~~5.3 million and $~~4.4~~4.5 million, respectively.

The Company incurs pre-production tooling costs related to products produced for its customers under long-term supply arrangements. Engineering, testing and other costs incurred in the design and development of production parts are expensed as incurred, unless the costs are reimbursable by the customer. As of ~~January 28,~~July 29, 2023 and April ~~30, 2022,~~29, 2023, the Company had $~~30.8~~38.9 million and $~~27.2~~36.1 million, respectively, of pre-production tooling costs related to customer-owned tools for which reimbursement is contractually guaranteed by the customer or for which the customer has provided a non-cancelable right to use the tooling.

Costs for molds, dies and other tools used in products produced for its customers under long-term supply arrangements for which the Company has title are capitalized in property, plant and equipment and amortized over the shorter of the life of the arrangement or the estimated useful life of the assets. As of ~~January 28,~~July 29, 2023 and April ~~30, 2022,~~29, 2023, Company-owned tooling was $~~12.4~~15.2 million and $~~14.6~~12.2 million, respectively.

The Company tests goodwill and indefinite-lived intangible assets for impairment on an annual basis as of the beginning of the fourth quarter each fiscal year. In addition, the Company continuously monitors for events and circumstances that could negatively impact the key assumptions used in determining fair value and therefore require interim goodwill impairment testing, including long-term revenue growth projections, profitability, discount rates, volatility in the Company's market capitalization, and general industry, market and macroeconomic conditions.No ~~impairment indicators were identified in the nine months ended January 28, 2023.~~

During the three months ended July 29, 2023, the Company concluded that a triggering event had occurred for goodwill at a reporting unit in its Automotive segment. The triggering event was a result of an earlier than expected sunsetting of a significant program for a major electric vehicle customer, which led to a downward revision of forecasted cash flows. As a result, the Company performed a quantitative impairment assessment of the fair value for this reporting unit.

The Company engaged a third-party valuation specialist to assist management in performing the interim goodwill impairment assessment. The fair value of the reporting unit was estimated using a combination of the income approach and market approach. The income approach uses a discounted cash flow method and the market approach uses appropriate valuation multiples observed for the reporting unit’s guideline public companies. The determination of discounted cash flows are based on management’s estimates of revenue growth rates and earnings before interest, taxes, depreciation and amortization (“EBITDA”) margins, taking into consideration business and market conditions for the countries and markets in which the reporting unit operates. The Company calculates the discount rate based on a market-participant, risk-adjusted weighted average cost of capital, which considers industry specific rates of return on debt and equity capital for a target industry capital structure, adjusted for risks associated with business size, geography and other factors specific to the reporting unit. Long-range forecasting involves uncertainty which increases with each successive period. Revenue growth rates and profitability assumptions, especially in the outer years, involve a greater degree of uncertainty.

Based upon the quantitative impairment assessment, the Company determined the fair value exceeded the carrying amount for this reporting unit, and thus no impairment was recorded. However, further changes to the assumptions regarding future performance, an adverse change to macroeconomic conditions, or a change to other assumptions could result in impairment losses in the future, which could be significant.

Note 9. Shareholders’ Equity

Share buyback program

~~On March 31, 2021, the~~The Board of Directors authorized ~~the~~a program to purchase of up to $~~100.0~~200.0 million of the Company’s outstanding common stock through ~~March 31, 2023. On June 16, 2022, the Board of Directors authorized an increase in the share buyback program of an additional $100.0~~ ~~million, and extended the expiration of the program to~~ June 14, 2024. Purchases may be made in private transactions or on the open market, including pursuant to purchase plans designed to comply with Rule 10b5-1 of the Securities Exchange Act of 1934.

The following table summarizes the Company’s stock buyback activity under this share buyback program:


	Three Months Ended				Nine Months Ended				Three Months Ended
(in millions, except share and per share data)	January 28, 2023		January 29, 2022		January 28, 2023		January 29, 2022		July 29, 2023		July 30, 2022
Shares purchased		179,700		460,161		1,005,514		1,425,190		—		317,635
Average price per share	$	44.54	$	46.39	$	39.34	$	44.73	$	—	$	37.43
Total cost	$	8.0	$	21.3	$	39.6	63.7		$	—	$	11.9

As of ~~January 28,~~July 29, 2023, a total of ~~2,598,653~~2,790,375 shares have been purchased at a total cost of $~~110.8~~119.3 million since the commencement of the share buyback program. All purchased shares were retired and are reflected as a reduction of common stock for the par value of shares, with the excess applied as a reduction to retained earnings. As of ~~January 28,~~July 29, 2023, the dollar value of shares that remained available to be purchased by the Company under this share buyback program was $~~89.2~~80.7 million.

Dividends

The Company paid dividends totaling $~~5.0~~5.3 million and $~~5.1~~5.0 million in the three months ended ~~January 28,~~July 29, 2023 and ~~January 29,~~July 30, 2022, respectively. ~~The Company~~Dividends paid ~~dividends totaling~~in the three months ended July 29, 2023 include $~~14.9~~0.4 million ~~and $15.4~~ ~~million in~~of dividend equivalent payments for restricted stock units that vested at the ~~nine months ended January 28, 2023 and January 29, 2022, respectively.~~end of fiscal 2023.

Accumulated other comprehensive income (loss)

Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. A summary of changes in AOCI, net of tax is shown below:


	Three Months Ended January 28, 2023									Nine Months Ended January 28, 2023									Three Months Ended July 29, 2023
(in millions)	Currency translation adjustments			Derivative instruments			Total			Currency translation adjustments			Derivative instruments			Total			Currency translation adjustments			Derivative instruments			Total
Balance at beginning of period	$	(61.1	)	$	6.8		$	(54.3	)	$	(30.5	)	$	3.7		$	(26.8	)	$	(19.8	)	$	0.8		$	(19.0	)
Other comprehensive income (loss)		37.7			(5.8	)		31.9			6.9			(1.7	)		5.2			(2.7	)		(2.2	)		(4.9	)
Tax (expense) benefit		(0.6	)		1.4			0.8			(0.4	)		0.4			—			0.2			0.6			0.8
Net other comprehensive income (loss)		37.1			(4.4	)		32.7			6.5			(1.3	)		5.2			(2.5	)		(1.6	)		(4.1	)
Balance at the end of period	$	(24.0	)	$	2.4		$	(21.6	)	$	(24.0	)	$	2.4		$	(21.6	)	$	(22.3	)	$	(0.8	)	$	(23.1	)

Three Months Ended January 29, 2022

Nine Months Ended January 29, 2022

(in millions)

Currency translation adjustments

Derivative instruments

Total

Currency translation adjustments

Derivative instruments

Total

Balance at beginning of period

$
0.8

$
(2.8
)

$
(2.0
)

$
11.5

$
(5.4
)

$
6.1

Other comprehensive income (loss)

(11.1
)

3.2

(7.9
)

(21.9
)

6.5

(15.4
)
Tax (expense) benefit

0.1

(0.8
)

(0.7
)

0.2

(1.5
)

(1.3
)
Net other comprehensive income (loss)

(11.0
)

2.4

(8.6
)

(21.7
)

5.0

(16.7
)
Balance at the end of period

$
(10.2
)

$
(0.4
)

$
(10.6
)

$
(10.2
)

$
(0.4
)

$
(10.6
)

~~Table of Contents~~


	Three Months Ended July 30, 2022
(in millions)	Currency translation adjustments			Derivative instruments			Total
Balance at beginning of period	$	(30.5	)	$	3.7		$	(26.8	)
Other comprehensive income (loss)		(10.9	)		2.0			(8.9	)
Tax (expense) benefit		—			(0.5	)		(0.5	)
Net other comprehensive income (loss)		(10.9	)		1.5			(9.4	)
Balance at the end of period	$	(41.4	)	$	5.2		$	(36.2	)

~~On September 14, 2022, the Company's stockholders approved~~The Company has granted stock options, restricted stock awards (“RSAs”), performance units (“PUs”), restricted stock units (“RSUs”) and stock awards to employees and non-employee directors under the Methode Electronics, Inc. 2022 Omnibus Incentive Plan (“2022 Plan”)~~. After that date, no further awards can be granted under~~, the Methode Electronics, Inc. 2014 Omnibus Incentive Plan (“2014 Plan”), the Methode Electronics, Inc. 2010 Stock Plan (“2010 Plan”), and the Methode Electronics, Inc. 2004 Stock Plan (“2004 Plan”). The Company’s stockholders approved the 2022 Plan ~~provides for discretionary~~on September 14, 2022. The Company can no longer make grants ~~of stock options, stock appreciation rights (“SARs”), restricted stock, restricted stock units~~under the 2014 Plan, 2010 Plan and ~~performance grants to employees and directors.~~2004 Plan.

Subject to adjustment as provided in the 2022 Plan and the 2022 Plan’s share counting provisions, the number of shares of the Company's common stock that will be available for all awards under the 2022 Plan is 5,550,000, less one share for every one share of common stock subject to an option or SAR award granted after April 30, 2022 under the 2014 Plan and 2.28 shares for every one share that was subject to an award other than an option or SAR granted after April 30, 2022 under the 2014 Plan. As of ~~January 28,~~July 29, 2023, there were ~~5,242,881~~5,146,941 shares available for award under the 2022 Plan.

The Company has granted stock options, restricted stock awards (“RSAs”), performance units (“PUs”), restricted stock units (“RSUs”) and stock awards to employees and non-employee directors under the 2022 Plan, the 2014 Plan, the Methode Electronics, Inc. 2010 Stock Plan (“2010 Plan”), the Methode Electronics, Inc. 2007 Stock Plan (“2007 Plan”) and the Methode Electronics, Inc. 2004 Stock Plan (“2004 Plan”). The Company can no longer make grants under the 2014 Plan, 2010 Plan, 2007 Plan and 2004 Plan.16

As of ~~January 28,~~July 29, 2023, the Company had ~~949,674~~933,674 RSAs outstanding which may be earned based on the achievement of an earnings before net interest, taxes, fixed asset depreciation and intangible asset amortization (“EBITDA”) measure for fiscal 2025. The RSAs will vest ranging from 0% (for performance below threshold) to 100% (target performance) based on the achievement of the EBITDA performance measure and continued employment. In addition, if the target performance is exceeded, up to an additional ~~474,837~~466,837 PUs can be earned that will be settled in cash. At the discretion of the Compensation Committee, the PUs may be settled in shares of common stock.

The fair value of the RSAs was based on the closing stock price on the date of grant and the RSAs earn dividend equivalents during the vesting period, which are forfeitable if the RSAs do not vest. Compensation expense for the RSAs is recognized when it is probable the minimum threshold performance criteria will be achieved. Compensation expense for the PUs is recognized when it is probable that the target performance criteria will be exceeded. The Company assesses the probability of vesting at each balance sheet date and adjusts compensation costs based on the probability assessment. The cash-settled PUs represent a non-equity unit with a conversion value equal to the fair market value of a share of the Company’s common stock on the vesting date. The PUs are classified as liability awards due to the cash settlement feature and are re-measured at each balance sheet date. In accordance with ~~Accounting Standards Codification~~ASC 718, based on projections of the Company’s current business portfolio, no compensation expense has been recognized for the RSAs or PUs to date, as the performance conditions are not probable of being met. Unrecognized stock-based compensation expense at target level of performance is $~~27.3~~26.8 million as of ~~January 28,~~July 29, 2023, which, subject to the performance conditions being met, will be recognized through fiscal 2025.

The following table summarizes RSA activity:

Restricted
stock
awards

Weighted
average grant
date fair value

Non-vested at April 30, 2022

928,412

$
28.50

Awarded

21,262

$
38.41

Vested

—

$
—

Forfeited

—

$
—

Non-vested at January 28, 2023

949,674

$
28.72

~~Table of Contents~~


	Restricted stock awards		Weighted average grant date fair value
Non-vested at April 29, 2023		933,674	$	28.73
Awarded		—	$	—
Vested		—	$	—
Forfeited		—	$	—
Non-vested at July 29, 2023		933,674	$	28.73

Restricted stock units

RSUs granted vest over a pre-determined period of time, up to five years from the date of grant. The fair value of the RSUs granted are based on the closing stock price on the date of grant and earn dividend equivalents during the vesting periods, which are forfeitable if the RSUs don’t vest.

The following table summarizes RSU activity:


	Restricted stock units			Weighted average grant date fair value		Restricted stock units			Weighted average grant date fair value
Non-vested at April 30, 2022		936,391		$	29.16
Non-vested at April 29, 2023							727,467		$	30.60
Awarded		74,508		$	39.21		—		$	—
Vested		—		$	—		—		$	—
Forfeited		(734	)	$	48.41		(6,852	)	$	41.87
Non-vested at January 28, 2023		1,010,165		$	29.89
Non-vested at July 29, 2023							720,615		$	30.49

Under the various stock plans, common stock underlying vested RSUs held by certain executives will not be delivered until termination of employment or a change of control of the Company. As of ~~January 28,~~July 29, 2023, common stock to be delivered to these executives totaled 577,055 shares.

Director awards

The Company grants stock awards to its non-employee directors as a component of their compensation. The stock awards vest immediately upon grant. Non-employee directors may elect to defer receipt of their shares under the Company’s non-qualified deferred compensation plan. ~~In the nine months ended January 28, 2023, the Company~~The following table summarizes awards granted to non-employee directors:~~43,179~~


	Non-employee director awards			Deferred non-employee director awards		Total			Weighted average grant date fair value
Outstanding at April 29, 2023		—			45,750		45,750		$	40.56
Awarded		16,804			29,729		46,533		$	33.32
Issued		(16,804	)		—		(16,804	)	$	33.32
Outstanding at July 29, 2023		—			75,479		75,479		$	37.31

~~shares,~~

Table of ~~which~~ Contents~~27,639~~

shares were deferred. All dividends on deferred shares are reinvested into additional deferred shares based on the closing price of the Company’s common stock on the dividend payment date. Deferred shares will be settled with shares of common stock upon each director’s retirement from the Company’s Board of Directors. As of January 28, 2023, there were ~~45,594~~ ~~deferred shares outstanding.~~

Stock options

The following table summarizes stock option activity:


	Stock options			Weighted average exercise price		Weighted- average life (years)		Aggregate intrinsic value (in millions)		Stock options		Weighted average exercise price		Weighted- average life (years)		Aggregate intrinsic value (in millions)
Outstanding and exercisable at April 30, 2022		60,000		$	37.01		2.2	$	0.5
Outstanding and exercisable at April 29, 2023											20,000	$	37.01		1.2	$	0.1
Exercised		(40,000	)	$	37.01						—	$	—
Forfeited		—		$	—						—	$	—
Outstanding and exercisable at January 28, 2023		20,000		$	37.01		1.4	$	0.2
Outstanding and exercisable at July 29, 2023											20,000	$	37.01		0.9	$	0.0

The aggregate intrinsic value represents the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the period and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on that date. ~~The total intrinsic value of options exercised in the nine months ended January 28, 2023 was $0.4~~ ~~million.~~

Stock-based compensation expense

All stock-based awards to employees and non-employee directors are recognized in selling and administrative expenses on the condensed consolidated statements of income. Awards subject to graded vesting are recognized using the accelerated recognition method over the requisite service period. The table below summarizes the stock-based compensation expense related to the equity awards:


	Three Months Ended				Nine Months Ended				Three Months Ended
(in millions)	January 28, 2023		January 29, 2022		January 28, 2023		January 29, 2022		July 29, 2023		July 30, 2022
RSUs	$	2.7	$	2.6	$	7.8	$	7.7	$	1.0	$	2.4
Deferred director awards		—		—		1.0		0.8
Director awards		—		—		0.6		0.7
Deferred non-employee director awards										1.0		1.0
Non-employee director awards										0.6		0.6
Total stock-based compensation expense	$	2.7	$	2.6	$	9.4	$	9.2	$	2.6	$	4.0

~~Table of Contents~~

Note 10. Income per Share

Basic income per share is calculated by dividing net income by the weighted average number of common shares outstanding for the applicable period but excludes any contingently issued shares where the contingency has not been resolved. The weighted average number of common shares used in the diluted income per share calculation is determined using the treasury stock method which includes the effect of all potential dilutive common shares outstanding during the period.

The following table sets forth the computation of basic and diluted income per share:


	Three Months Ended				Nine Months Ended				Three Months Ended
	January 28, 2023		January 29, 2022		January 28, 2023		January 29, 2022		July 29, 2023		July 30, 2022
Numerator:
Net income (in millions)	$	19.9	$	29.4	$	69.0	$	86.0	$	0.9	$	21.5

Denominator:
Denominator for basic income per share - weighted average shares outstanding and vested/unissued restricted stock units		35,757,465		36,853,617		36,149,858		37,445,822		35,687,876		36,565,975
Dilutive potential common shares		819,530		622,273		728,351		559,881		593,531		649,825
Denominator for diluted income per share		36,576,995		37,475,890		36,878,209		38,005,703		36,281,407		37,215,800

Basic and diluted income per share:
Basic income per share	$	0.56	$	0.80	$	1.91	$	2.30	$	0.03	$	0.59
Diluted income per share	$	0.54	$	0.78	$	1.87	$	2.26	$	0.02	$	0.58

Number of anti-dilutive potentially issuable shares excluded from diluted common shares outstanding		949,674		928,412		939,573		928,412		935,698		928,534

Table of Contents

Note 11. Segment Information

An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses, and about which separate financial information is regularly evaluated by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources. The CODM is the Company’s President and Chief Executive Officer. The Company has four reporting segments as described below.

The Automotive segment supplies electronic and electro-mechanical devices and related products to automobile OEMs, either directly or through their tiered suppliers. Products include integrated center consoles, hidden switches, ergonomic switches, transmission lead-frames, LED-based lighting and sensors, which incorporate magneto-elastic sensing and other technologies that monitor the operation or status of a component or system.

The Industrial segment manufactures external lighting solutions, industrial safety radio remote controls, braided flexible cables, current-carrying laminated busbars and devices, custom power-product assemblies, such as our PowerRail® solution, high-current low-voltage flexible power cabling systems and powder-coated busbars that are used in various markets and applications, including aerospace, computers, industrial, power conversion, military, telecommunications and transportation.

The Interface segment provides a variety of copper and fiber-optic interface and interface solutions for the appliance, commercial food service, construction, consumer, material handling, point-of-sale and telecommunications markets. Solutions include copper transceivers and solid-state field-effect consumer touch panels.

The Medical segment is made up of the Company’s medical device business, Dabir Surfaces, with its surface support technology aimed at pressure injury prevention. Methode has developed the technology for use by patients who are immobilized or otherwise at risk for pressure injuries, including patients undergoing long-duration surgical procedures.

~~Table~~ In July 2023, the Company made the decision to wind-down its Dabir Surfaces business, which is expected to be completed by approximately the end of ~~Contents~~fiscal 2024.

The tables below present information about the Company’s reportable segments:


	Three Months Ended January 28, 2023																	Three Months Ended July 29, 2023
(in millions)	Automotive			Industrial			Interface			Medical			Eliminations /Corporate			Consolidated		Automotive			Industrial			Interface			Medical			Eliminations/ Corporate			Consolidated
Net sales	$	178.6		$	100.8		$	12.1		$	0.6		$	(12.0	)	$	280.1	$	161.1		$	122.6		$	15.3		$	0.8		$	(10.1	)	$	289.7
Transfers between segments		(2.1	)		(9.8	)		(0.1	)		—			12.0			—		(2.8	)		(7.2	)		(0.1	)		—			10.1			—
Net sales to unaffiliated customers	$	176.5		$	91.0		$	12.0		$	0.6		$	—		$	280.1	$	158.3		$	115.4		$	15.2		$	0.8		$	—		$	289.7

Income (loss) from operations	$	18.7		$	22.3		$	1.0		$	(1.8	)	$	(12.9	)	$	27.3	$	(2.8	)	$	24.2		$	2.9		$	(2.2	)	$	(18.3	)	$	3.8
Interest expense, net																	0.8																	2.8
Other expense, net																	3.5																	—
Pre-tax income																$	23.0																$	1.0


	Three Months Ended January 29, 2022																	Three Months Ended July 30, 2022
(in millions)	Automotive			Industrial			Interface		Medical			Eliminations /Corporate			Consolidated			Automotive			Industrial			Interface		Medical			Eliminations /Corporate			Consolidated
Net sales	$	196.9		$	81.6		$	15.2	$	1.0		$	(3.1	)	$	291.6		$	177.3		$	93.7		$	13.0	$	0.7		$	(2.3	)	$	282.4
Transfers between segments		(1.5	)		(1.6	)		—		—			3.1			—			(0.7	)		(1.6	)		—		—			2.3			—
Net sales to unaffiliated customers	$	195.4		$	80.0		$	15.2	$	1.0		$	—		$	291.6		$	176.6		$	92.1		$	13.0	$	0.7		$	—		$	282.4

Income (loss) from operations	$	24.5		$	17.7		$	2.1	$	(1.6	)	$	(12.9	)	$	29.8		$	14.7		$	22.4		$	1.6	$	(1.5	)	$	(15.4	)	$	21.8
Interest expense, net																0.7																	0.0
Other income, net																(4.4	)																(4.1	)
Pre-tax income															$	33.5																$	25.9

Nine Months Ended January 28, 2023

(in millions)

Automotive

Industrial

Interface

Medical

Eliminations
/Corporate

Consolidated

Net sales

$
554.2

$
302.3

$
39.2

$
2.4

$
(19.7
)

$
878.4

Transfers between segments

(4.2
)

(15.4
)

(0.1
)

—

19.7

—

Net sales to unaffiliated customers

$
550.0

$
286.9

$
39.1

$
2.4

$
—

$
878.4

Income (loss) from operations

$
56.8

$
69.7

$
4.2

$
(4.7
)

$
(44.1
)

$
81.9

Interest expense, net

1.3

Other income, net

(1.7
)
Pre-tax income

$
82.3

Nine Months Ended January 29, 2022

(in millions)

Automotive

Industrial

Interface

Medical

Eliminations
/Corporate

Consolidated

Net sales

$
591.0

$
245.5

$
45.9

$
2.6

$
(10.1
)

$
874.9

Transfers between segments

(3.8
)

(6.3
)

—

—

10.1

—

Net sales to unaffiliated customers

$
587.2

$
239.2

$
45.9

$
2.6

$
—

$
874.9

Income (loss) from operations

$
75.4

$
56.7

$
7.6

$
(4.6
)

$
(38.0
)

$
97.1

Interest expense, net

2.9

Other income, net

(7.1
)
Pre-tax income

$
101.3


(in millions)	January 28, 2023		April 30, 2022		July 29, 2023		April 29, 2023
Identifiable assets:
Automotive	$	713.9	$	689.8	$	702.8	$	700.2
Industrial		459.5		455.3		665.7		672.3
Interface		120.5		108.1		126.8		127.2
Medical		6.4		7.9		2.1		6.2
Eliminations/Corporate		128.2		128.0		76.7		73.2
Total identifiable assets	$	1,428.5	$	1,389.1	$	1,574.1	$	1,579.1

2219

Table of Contents

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

As used herein, “we,” “us,” “our,” the “Company” or “Methode” means Methode Electronics, Inc. and its subsidiaries.

This Quarterly Report on Form 10-Q (“Quarterly Report”) includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect, when made, our current views with respect to current events and financial performance. Such forward-looking statements are subject to many risks, uncertainties and factors relating to our operations and business environment, which may cause our actual results to be materially different from any future results, express or implied, by such forward-looking statements. All statements that address future operating, financial or business performance or our strategies or expectations are forward-looking statements. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “potential,” “outlook” or “continue,” and other comparable terminology. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the following:

Additional details and factors are discussed under the caption “Risk Factors” in Part 1, Item 1A of our Annual Report on Form 10-K for the year ended April ~~30, 2022.~~29, 2023. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. Any forward-looking statements made by us speak only as of the date on which they are made. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether as a result of new information, subsequent events or otherwise.

We are a leading global supplier of custom engineered solutions with sales, engineering and manufacturing locations in North America, Europe, Middle East and Asia. We design, engineer and produce mechatronic products for Original Equipment Manufacturers (“OEMs”) utilizing our broad range of technologies for user interface, light-emitting diode (“LED”) lighting system, power distribution and sensor applications.

Our solutions are found in the end markets of transportation (including automotive, commercial vehicle, e-bike, aerospace, bus and rail), cloud computing infrastructure, construction equipment and consumer ~~appliance and medical devices.~~appliance. Our business is managed on a segment basis, with those segments being Automotive, Industrial, Interface and Medical.

The COVID-19 pandemic and the ongoing measures to reduce its spread have negatively impacted the global economy, disrupted consumer and customer demand and global supply chains, and resulted in manufacturing inefficiencies and increased freight costs due to global capacity constraints. Beginning late in the fourth quarter of fiscal 2022 and continuing into fiscal 2023, various regions in China, including regions where we and our customers have operations, were subjected to lockdowns imposed by governmental authorities to mitigate the spread of COVID-19 in those areas. The resulting industry-wide production interruptions adversely impacted our results of operations in the nine months ended January 28, 2023.

Any future resurgence of COVID-19, and its related impacts, could negatively impact our business and future results of operations. The extent of the impact will depend on a number of evolving and uncertain factors, including the duration and spread of COVID-19 (and its variants), the rate of vaccinations, actions taken by governmental authorities to further restrict business operations and social activity and impose travel restrictions, shifting consumer demand, the ability of our supply chain to deliver in a timely and cost-effective manner, the ability of our employees and manufacturing facilities to operate efficiently and effectively, the continued viability and financial stability of our customers and suppliers and future access to capital. We continue to focus on effectively managing the unprecedented challenges and uncertainties of the pandemic on a global basis.

We continue to experience business interruptions, including customer shutdowns and increased material and logistics costs, labor shortages, and impacts from the worldwide semiconductor supply shortage. The semiconductor supply shortage is due, in part, to increased demand across multiple industries, including the automotive industry, resulting in a slowdown in production schedules. The semiconductor supply shortage is also impacting our supply chain and our ability to meet demand at some of our non-automotive customers. We expect this semiconductor shortage to have a continued impact on our operating results and financial condition for the remainder of fiscal 2023.

Adverse macroeconomic conditions, including but not limited to inflation, slower growth or recession, ~~new or increased tariffs,~~ changes to fiscal and monetary policy, higher interest rates, wage and commodity inflation, ~~and~~ currency fluctuations and new or increased tariffs, could adversely affect demand for our products. In addition, the Russia/Ukraine conflict has resulted in, among other things, economic sanctions imposed by the international community which have impacted the global economy and given rise to potential global security issues that may adversely affect international business and economic conditions. Although we have no operations in Russia or Ukraine, certain of our customers and suppliers have been negatively impacted by these events, which in turn has impacted markets where we do business, including Europe and Asia. The economic sanctions imposed on Russia have further increased existing global supply chain, logistics, and inflationary challenges. ~~For example, in response~~

Due to ~~the sanctions imposed on Russia by Western countries, Russia has reduced the volume of natural gas it sends~~various factors that are beyond our control, there continues to ~~European countries, which has resulted in,~~be global supply chain disruptions, including a worldwide semiconductor supply shortage. In addition, we have experienced, and ~~could~~may continue to ~~result~~experience, business interruptions, including customer shutdowns and increased material and logistics costs and labor shortages. The semiconductor supply shortage is due, in part, to increased ~~energy costs for~~demand across multiple industries, including the automotive industry, resulting in a slowdown in their production schedules. The semiconductor supply shortage is also impacting our ~~EMEA operations. If Russia further reduces or turns off energy supplies~~supply chain and our ability to ~~Europe,~~meet demand at some of our ~~EMEA operations could be adversely affected.~~non-automotive customers. We expect this semiconductor shortage to have a continued impact on our operating results and financial condition in fiscal 2024.

~~On February 28, 2023, we announced that we entered into a definitive agreement pursuant to which we will launch a recommended public tender offer for all~~We acquired 92.2% of the outstanding shares of Nordic Lights ~~Group Corporation (“~~on April 20, 2023 and acquired a further 7.2% of the outstanding shares of Nordic ~~Lights”), at an offer price~~Lights in the three months ended July 29, 2023. As of ~~€6.30 per share, for a total equity value of approximately €132 million.~~July 29, 2023, our current ownership in Nordic Lights is ~~a premium provider~~99.4%. The results of ~~high-quality lighting solutions for heavy-duty equipment and a public limited liability company incorporated in Finland with its shares admitted to trading on Nasdaq First North.~~

The transaction is subject to the satisfaction (or waiver by Methode) of customary closing conditions for the acquisition of a public company in Finland, including, among others, (i) that the tender offer is irrevocably accepted by shareholders holding more than 90 percent of the shares and voting rights in Nordic Lights, which will enable us to compulsorily acquire the remaining shares in the capitaloperations of Nordic Lights ~~under Finnish law, and (ii)~~are reported within the ~~receipt of all necessary regulatory approvals. The transaction is expected~~Industrial segment. For further information, see Note 3, “Acquisition” to ~~be completed (including completion of~~ the ~~compulsory acquisition of Nordic Lights shares from any non-tendering minority)~~condensed consolidated financial statements included in ~~the second half of calendar 2023.~~this Report.

The table below compares our results of operations between the three ~~and nine~~ months ended ~~January 28,~~July 29, 2023 and the three ~~and nine~~ months ended ~~January 29,~~July 30, 2022:

Net sales ~~decreased $11.5~~increased $7.3 million, or ~~3.9%~~2.6%, to ~~$280.1~~$289.7 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$291.6~~$282.4 million in the three months ended ~~January 29,~~July 30, 2022. The ~~decrease~~increase was primarily due to ~~lower~~the acquisition of Nordic Lights, which contributed $21.2 million of net sales, ~~in the Automotive segment, partially offset by higher sales in the Industrial segment. Net sales were unfavorably impacted by~~and favorable foreign currency translation of ~~$13.0~~$0.5 million, ~~primarily due to the strengthening of the U.S. dollar relative to the euro and Chinese renminbi. Net sales included~~partially offset by lower customer cost recoveries from spot buys of materials and premium freight costs of ~~$1.4 million in the three months ended January 28, 2023, compared to $10.6 million in the three months ended January 29, 2022.~~$10.4 million. Excluding the impact of Nordic Lights, foreign currency translation and customer cost recoveries, net sales ~~increased $10.7~~decreased $4.0 million, or ~~3.8%~~1.5%.

Net sales increased $3.5 million, or 0.4%, to $878.4 million in the nine months ended January 28, 2023, compared to $874.9 million in the nine months ended January 29, 2022. The increase was primarily due to higher sales in the Industrial segment, partially offset See further discussion below by ~~lower sales in the Automotive~~reportable operating segment. Net sales were unfavorably impacted by foreign currency translation of $49.7 million, primarily due to the strengthening of the U.S. dollar relative to the euro and Chinese renminbi. Net sales included customer cost recoveries from spot buys of materials and premium freight costs of $18.3 million in the nine months ended January 28, 2023, compared to $15.1 million in the nine months ended January 29, 2022. Excluding the impact of foreign currency translation and customer cost recoveries, net sales increased $50.0 million, or 5.8%.

Cost of products sold ~~decreased $7.3~~increased $15.1 million, or ~~3.3%~~6.8%, to ~~$215.2~~$235.7 million ~~(76.8%~~(81.4% of net sales) in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$222.5~~$220.6 million ~~(76.3%~~(78.1% of net sales) in the three months ended ~~January 29,~~July 30, 2022. The increase was primarily due to the acquisition of Nordic Lights, which accounted for $15.9 million of the increase, and favorable foreign currency translation of $0.3 million. Excluding Nordic Lights and foreign currency translation, cost of products sold ~~increased $2.6~~decreased $1.1 million. The ~~increase~~decrease was primarily due to ~~higher salary and operating expenses, partially offset by~~ lower material costs as a result of a decrease in sales ~~volumes. In addition,~~volumes, partially offset by higher salary, freight and operating expenses. Restructuring costs were $0.6 million in the three months ended ~~January~~July 29, ~~2022 included restructuring costs of $1.2 million.~~

~~Cost of products sold increased $12.7 million, or 1.9%, to $677.6 million (77.1% of net sales) in the nine months ended January 28,~~ 2023, compared to ~~$664.9 million (76.0% of net sales)~~zero in the ~~nine~~three months ended January 29, 2022. Excluding foreign currency translation, cost of products sold increased $49.5 million. The increase was primarily due to higher material costs as a result of an increase in sales volumes and higher salary and operating expenses, partially offset by lower restructuring costs. Restructuring costs were $0.1 million in the nine months ended January 28, 2023, compared to $1.2 million in the nine months ended January 29,July 30, 2022.

Gross profit margin was ~~23.2%~~18.6% of net sales in the three months ended ~~January 28,~~July 29, 2023, compared to ~~23.7%~~21.9% of net sales in the three months ended ~~January 29,~~July 30, 2022. The decrease was a result of continued inflationary pressures on material costs and ~~other manufacturing costs.~~

~~Gross profit margin was 22.9% of net sales~~operational inefficiencies in the nine months ended January 28, 2023, compared to 24.0% of net sales in the nine months ended January 29, 2022. The decrease was due to inflationary pressures on material and other manufacturing costs, partially offset by higher sales volumes.

Selling and administrative expenses ~~decreased $1.6~~increased $9.2 million, or ~~4.6%~~26.1%, to ~~$32.9~~$44.5 million ~~(11.7%~~(15.4% of net sales) in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$34.5~~$35.3 million ~~(11.8%~~(12.5% of net sales) in the three months ended ~~January 29,~~July 30, 2022. ~~Excluding~~The acquisition of Nordic Lights and favorable foreign currency translation ~~selling~~accounted for $2.0 million and ~~administrative expenses decreased $0.9 million. The decrease was primarily due to lower annual cash incentive compensation expense, partially offset by higher salary expense. In addition,~~$0.3 million, respectively, of the ~~three months ended January 29, 2022 included restructuring costs of $1.9 million.~~

~~Selling~~increase. Excluding Nordic Lights and administrative expenses increased $6.3 million, or 6.4%, to $104.8 million (11.9% of net sales) in the nine months ended January 28, 2023, compared to $98.5 million (11.3% of net sales) in the nine months ended January 29, 2022. Excluding foreign currency translation, selling and administrative expenses increased ~~$10.0 million. The increase was~~$6.9 million primarily due to higher ~~salary expense,~~ professional fees and travel expense, partially offset by lower restructuring costs. Restructuring costs were $0.5 million in the nine months ended January 28, 2023, compared to $2.1 million in the nine months ended January 29, 2022.outbound freight expense.

Amortization of intangibles was $5.7 million in the three months ended July 29, 2023, compared to $4.7 million in the three months ended ~~January 28, 2023, compared~~July 30, 2022. The increase was due to ~~$4.8 million in~~ the ~~three months ended January 29, 2022.~~

~~Amortization~~recognition of ~~intangibles was $14.1 million in~~amortization expense associated with the ~~nine months ended January 28, 2023, compared to $14.4 million in the nine months ended January 29, 2022.~~acquisition of Nordic Lights.

Interest expense, net was ~~$0.8~~$2.8 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$0.7 million~~zero in the three months ended ~~January 29,~~July 30, 2022. The increase was due to higher ~~interest expense~~borrowings, primarily to fund the acquisition of ~~$1.1 million, partially offset by~~Nordic Lights, and higher interest ~~income of $1.0 million recognized during the period. Higher interest income and interest expense was due to increasing interest~~ rates.

~~Interest expense, net was $1.3 million in the nine months ended January 28, 2023, compared to $2.9 million in the nine months ended January 29, 2022. The decrease was due to higher interest income~~24

Other expense, net was ~~$3.5 million~~zero in the three months ended ~~January 28,~~July 29, 2023, compared to other income, net of ~~$4.4~~$4.1 million in the three months ended ~~January 29, 2022. Net foreign exchange loss was $3.9 million in the three months ended January 28, 2023, compared to a net foreign exchange loss of $0.3 million in the three months ended January 29,~~July 30, 2022. In the three months ended ~~January 28, 2023,~~July 30, 2022, we received ~~$0.3~~$4.1 million of international government assistance. We did not receive any international government assistance ~~compared to $4.2 million~~ in the three months ended ~~January~~July 29, ~~2022.~~

Other income, net was $1.7 million in the nine months ended January 28, 2023, compared to $7.1 million in the nine months ended January 29, 2022. Net foreign exchange loss was $3.1 million in the nine months ended January 28, 2023, compared to a net foreign exchange loss of $1.7 million in the nine months ended January 29, 2022. In the nine months ended January 28, 2023, we received $4.6 million of international government assistance, compared to $8.2 million in the nine months ended January 29, 2022.2023.

Income tax expense was ~~$3.1~~$0.1 million ~~(13.5%~~(10.0% effective tax rate) in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$4.1~~$4.4 million ~~(12.2%~~(17.0% effective tax rate) in the three months ended ~~January 29,~~July 30, 2022. The effective tax rate for the three months ended ~~January 28,~~July 29, 2023 was lower than the U.S. statutory tax rate primarily due to income derived from foreign operations with lower statutory tax rates and research deductions claimed in foreign jurisdictions, partially offset by GILTI and non-deductible expenses. The effective tax rate for the three months ended ~~January 29,~~July 30, 2022 was lower than the U.S. statutory tax rate primarily due to the reversal of valuation allowances related to certain loss carryforwards and income derived from foreign operations with lower statutory tax rates.

Income tax expense was $13.3 million (16.2% effective tax rate) in the nine months ended January 28, 2023, compared to $15.3 million (15.1% effective tax rate) in the nine months ended January 29, 2022. The effective tax rate for the nine months ended January 28, 2023 was lower than the U.S. statutory tax rate primarily due to income derived from foreign operations with lower statutory tax rates ~~and research deductions claimed in foreign jurisdictions,~~ partially offset by non-deductible expenses. The effective tax rate for the nine months ended January 29, 2022 was lower than the U.S. statutory tax rate primarily due to the reversal of valuation allowances related to certain loss carryforwards and income derived from foreign operations with lower statutory tax rates.

Net income decreased ~~$9.5~~$20.6 million, or ~~32.3%~~95.8%, to ~~$19.9~~$0.9 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$29.4~~$21.5 million in the three months ended ~~January 29,~~July 30, 2022. ~~Net~~The acquisition of Nordic Lights contributed $1.1 million of net income, ~~was unfavorably impacted by~~and the impact from favorable foreign currency translation ~~of $1.8~~was $0.2 million. Excluding Nordic Lights and foreign currency translation, net income decreased ~~$7.7~~$21.9 million as a result of the reasons described above.

Net income decreased $17.0 million, or 19.8%, to $69.0 million in the nine months ended January 28, 2023, compared to $86.0 million in the nine months ended January 29, 2022. Net income was unfavorably impacted by foreign currency translation of $8.8 million. Excluding foreign currency translation, net income decreased $8.2 million as a result of the reasons described above.

Automotive segment net sales decreased ~~$18.9~~$18.3 million, or ~~9.7%~~10.4%, to ~~$176.5~~$158.3 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$195.4~~$176.6 million in the three months ended ~~January 29,~~July 30, 2022. ~~Net sales were unfavorably impacted by foreign currency translation of $8.1 million.~~ Excluding foreign currency translation and customer cost recoveries, net sales decreased ~~$9.3~~$9.4 million, or ~~4.8%~~5.6%.

Net sales in North America decreased ~~$20.8~~$27.9 million to ~~$82.9~~$66.8 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$103.7~~$94.7 million in the three months ended ~~January 29,~~July 30, 2022. Excluding customer cost recoveries, net sales decreased ~~$18.8~~$20.0 million primarily due to lower sales volumes from a major program ~~roll-off.~~roll-off and lower sales volumes of integrated center stack products. Net sales in EMEA increased ~~$12.3~~$0.1 million to ~~$56.3~~$52.2 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$44.0~~$52.1 million in the three months ended ~~January 29,~~July 30, 2022. The ~~weaker~~stronger euro, relative to the U.S. dollar, ~~decreased~~increased net sales in EMEA by ~~$4.4~~$2.3 million. Excluding foreign currency translation and customer cost recoveries, net sales in EMEA ~~increased $16.2~~decreased $1.2 million due to lower sales volumes of sensor products, partially offset by higher sales volumes of user interface and switch products. Net sales in Asia ~~decreased $10.4~~increased $9.5 million to ~~$37.3~~$39.3 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$47.7~~$29.8 million in the three months ended ~~January 29,~~July 30, 2022. The weaker Chinese renminbi, relative to the U.S. dollar, decreased net sales in Asia by ~~$3.7~~$2.3 million. Excluding foreign currency translation, Asia net sales ~~decreased $6.7 million primarily due to lower overhead console, touchscreen and electric vehicle product~~increased $11.8 million. Net sales ~~volumes.~~in the three months ended July 30, 2022 were impacted by COVID-19 lockdowns in China.

Automotive segment net sales decreased $37.2 million, or 6.3%, to $550.0 million in the nine months ended January 28, 2023, compared to $587.2 million in the nine months ended January 29, 2022. Net sales were unfavorably impacted by foreign currency translation of $30.4 million and the roll-off of a major program in North America. Excluding foreign currency translation and customer cost recoveries, net sales decreased $12.6 million, or 2.2%.

Net sales in North America decreased $26.7 million to $275.4 million in the nine months ended January 28, 2023, compared to $302.1 million in the nine months ended January 29, 2022. Excluding customer cost recoveries, net sales decreased $30.0 million primarily due to lower sales volumes from a major program roll-off. Net sales in EMEA increased $5.6 million to $162.3 million in the nine months ended January 28, 2023, compared to $156.7 million in the nine months ended January 29, 2022. The weaker euro, relative to the U.S. dollar, decreased net sales in EMEA by $21.7 million. Excluding foreign currency translation and customer cost recoveries, net sales in EMEA increased $25.5 million due to higher sales volumes of user interface and switch products. Net sales in Asia decreased $16.1 million to $112.3 million in the nine months ended January 28, 2023, compared to $128.4 million in the nine months ended January 29, 2022. The weaker Chinese renminbi, relative to the U.S. dollar, decreased net sales in Asia by $8.6 million. Excluding foreign currency translation and customer cost recoveries, Asia net sales decreased $8.1 million primarily due to lower overhead console sales volumes.

Automotive segment gross profit decreased ~~$7.3~~$14.1 million, or ~~18.6%~~48.0%, to ~~$32.0~~$15.3 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$39.3~~$29.4 million in the three months ended ~~January 29,~~July 30, 2022. Excluding the impact of foreign currency translation, gross profit decreased ~~$5.9~~$14.3 million. Gross profit margins decreased to ~~18.1%~~9.7% in the three months ended ~~January 28,~~July 29, 2023, compared to ~~20.1%~~16.6% in the three months ended ~~January 29,~~July 30, 2022. The decrease in gross profit margins was due to lower sales volumes in North America and ~~inflationary pressures on material~~EMEA and ~~other manufacturing costs.~~

~~Automotive segment~~operational inefficiencies in North America. This was partially offset by higher gross profit ~~decreased $18.5 million, or 15.7%, to $99.7 million~~ in ~~the nine months ended January 28, 2023, compared to $118.2 million~~Asia as a result of an increase in the nine months ended January 29, 2022. Excluding the impact of foreign currency translation, gross profit decreased $11.9 million. Gross profit margins decreased to 18.1% in the nine months ended January 28, 2023, compared to 20.1% in the nine months ended January 29, 2022. The decrease in gross profit margins was due to lower sales ~~volumes and inflationary pressures on material and other manufacturing costs.~~volumes.

Automotive segment income from operations decreased ~~$5.8~~$17.5 million, or ~~23.7%~~119.0%, to ~~$18.7~~a loss of $2.8 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$24.5~~income of $14.7 million in the three months ended ~~January 29,~~July 30, 2022. Excluding the impact of foreign currency translation, income from operations decreased $5.0 million. The decrease was primarily due to lower gross profit, partially offset by lower selling and administrative expenses. Selling and administrative expenses decreased due to lower annual cash incentive compensation expense.

Automotive segment income from operations decreased $18.6 million, or 24.7%, to $56.8 million in the nine months ended January 28, 2023, compared to $75.4 million in the nine months ended January 29, 2022. Excluding the impact of foreign currency translation, income from operations decreased $14.7$17.2 million. The decrease was primarily due to lower gross profit and higher selling and administrative expenses. Selling and administrative expenses increased primarily due to higher ~~salary expense, professional fees and travel~~outbound freight expense.

Industrial segment net sales increased ~~$11.0~~$23.3 million, or ~~13.8%~~25.3%, to ~~$91.0~~$115.4 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$80.0~~$92.1 million in the three months ended ~~January 29,~~July 30, 2022. ~~Net~~The increase was primarily due to the acquisition of Nordic Lights, which contributed $21.2 million of net sales, ~~were unfavorably impacted by~~and favorable foreign currency translation of ~~$4.9~~$0.5 million, partially offset by lower customer cost recoveries from spot buys of materials and premium freight costs of $1.3 million. Excluding the impact of Nordic Lights, foreign currency translation and customer cost recoveries, net sales increased ~~$23.1~~$2.9 million, or ~~31.9%~~3.2%, primarily due to higher sales volumes of ~~power distribution solutions for data centers and electric vehicles.~~

Industrial segment net sales increased $47.7 million, or 19.9%, to $286.9 million in the nine months ended January 28, 2023, compared to $239.2 million in the nine months ended January 29, 2022. Net sales were unfavorably impacted by foreign currency translation of $19.3 million. Excluding the impact of foreign currency translation and customer cost recoveries, net sales increased $70.4 million, or 30.4%, primarily due to higher sales volumes of power distribution solutions for data centers and electric vehicles and of commercial vehicle lighting solutions ~~products.~~and radio remote control devices.

Industrial segment gross profit increased ~~$3.5~~$5.2 million, or ~~12.9%~~17.1%, to ~~$30.7~~$35.6 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$27.2~~$30.4 million in the three months ended ~~January 29,~~July 30, 2022. ~~Excluding~~The increase was due to the ~~impact~~acquisition of ~~foreign currency translation,~~Nordic Lights, which contributed $5.3 million of gross ~~profit increased $5.2 million.~~profit. Gross profit margins decreased to ~~33.7%~~30.8% in the three months ended ~~January 28,~~July 29, 2023, compared to ~~34.0%~~33.0% in the three months ended ~~January 29,~~July 30, 2022. Product mix impacted gross margins due to higher material costs for commercial vehicle lighting solutions products, which was partially offset by higher gross margins for power distribution solutions for data centers and electric vehicles due to increased sales volumes. Gross profit in the three months ended January 29, 2022 also included $1.2 million of restructuring costs.

Industrial segment gross profit increased $12.2 million, or 14.8%, to $94.4 million in the nine months ended January 28, 2023, compared to $82.2 million in the nine months ended January 29, 2022. Excluding the impact of foreign currency translation, gross profit increased $18.5 million. Gross profit margins ~~decreased to 32.9% in the nine months ended January 28, 2023, compared to 34.4% in the nine months ended January 29, 2022. Product mix~~were impacted gross margins primarily from higher material costs for commercial vehicle lighting solutions products as a result of supply chain disruptions. Gross profit in the nine months ended January 29, 2022 included restructuring costs of $1.2 million, compared to $0.1 million in the nine months ended January 28, 2023.by product mix.

Industrial segment income from operations increased ~~$4.6~~$1.8 million, or ~~26.0%~~8.0%, to ~~$22.3~~$24.2 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$17.7~~$22.4 million in the three months ended ~~January 29,~~July 30, 2022. The increase was due to the acquisition of Nordic Lights, which contributed $2.2 million of income from operations. Excluding Nordic Lights and the impact of foreign currency translation, income from operations ~~increased $6.2 million. The increase was primarily~~decreased $0.6 million due to higher ~~gross profit and lower~~ selling and administrative expenses. ~~Selling and administrative expenses in the three months ended January 29, 2022 included $1.9 million of restructuring costs.~~

Industrial segment income from operations increased $13.0 million, or 22.9%, to $69.7 million in the nine months ended January 28, 2023, compared to $56.7 million in the nine months ended January 29, 2022. Excluding the impact of foreign currency translation, income from operations increased $18.2 million. The increase was primarily due to higher gross profit, partially offset by a slight increase in selling and administrative expenses. Selling and administrative expenses in the nine months ended January 29, 2022 included restructuring costs of $1.9 million, compared to $0.4 million in the nine months ended January 28, 2023.

Interface segment net sales ~~decreased $3.2~~increased $2.2 million, or ~~21.1% to $12.0 million in the three months ended January 28, 2023, compared~~16.9% to $15.2 million in the three months ended ~~January~~July 29, 2023, compared to $13.0 million in the three months ended July 30, 2022. Excluding customer cost recoveries, net sales ~~decreased $2.7~~increased $2.4 million, or ~~18.9%~~19.4%. The ~~decrease~~increase was primarily due to ~~lower demand~~higher sales volumes of appliance ~~products.~~

Interface segment net sales decreased $6.8 million, or 14.8%, to $39.1 million in the nine months ended January 28, 2023, compared to $45.9 million in the nine months ended January 29, 2022. Excluding customer cost recoveries, net sales decreased $7.6 million, or 17.0%. The decrease was primarily due to lower demand of applianceproducts and data solutions products.

Interface segment gross profit ~~decreased $0.9~~increased $1.4 million, or ~~32.1%~~63.6%, to ~~$1.9~~$3.6 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$2.8~~$2.2 million in the three months ended ~~January 29,~~July 30, 2022. Gross profit margins ~~decreased~~increased to ~~15.8%~~23.7% in the three months ended ~~January 28,~~July 29, 2023, compared to ~~18.4%~~16.9% in the three months ended ~~January 29,~~July 30, 2022. The ~~decrease~~increase in gross profit margins was primarily due to ~~lower~~higher sales ~~volumes of appliance products.~~

Interface segment gross profit decreased $2.9 million, or 30.5%, to $6.6 million in the nine months ended January 28, 2023, compared to $9.5 million in the nine months ended January 29, 2022. Gross profit margins decreased to 16.9% in the nine months ended January 28, 2023, compared to 20.7% in the nine months ended January 29, 2022. The decrease in gross profit margins was primarily due to lower sales volumes of appliance products.

Interface segment income from operations ~~decreased $1.1~~increased $1.3 million, or ~~52.4%~~81.3%, to ~~$1.0~~$2.9 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$2.1~~$1.6 million in the three months ended ~~January 29,~~July 30, 2022. The ~~decrease~~increase was due to ~~lower~~higher gross ~~profit and higher selling and administrative expenses, primarily professional fees.~~

Interface segment income from operations decreased $3.4 million, or 44.7%, to $4.2 million in the nine months ended January 28, 2023, compared to $7.6 million in the nine months ended January 29, 2022. The decrease was due to lower gross profit and higher selling and administrative expenses, primarily salary expense and professional fees.profit.

In the first quarter of fiscal 2024, we made the decision to initiate the discontinuation of the Dabir business (which accounts for all of the Medical segment's financial results). We are currently executing a wind down process of the Dabir business which is expected to be completed by approximately the end of fiscal 2024 in accordance with contractual and regulatory commitments.

Medical segment net sales ~~decreased $0.4~~increased $0.1 million to ~~$0.6~~$0.8 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$1.0~~$0.7 million in the three months ended ~~January 29,~~July 30, 2022. ~~The decrease was due to lower demand.~~

Medical segment net sales decreased $0.2 million to $2.4 million in the nine months ended January 28, 2023, compared to $2.6 million in the nine months ended January 29, 2022. The decrease was due to lower demand.

Medical segment gross profit was a loss of $0.7 million in the three months ended July 29, 2023 compared to a loss of $0.2 million in the three months ended ~~January 28, 2023 compared~~July 30, 2022. The increase in the loss was due to ~~a loss~~the recognition of ~~$0.5~~restructuring costs of $0.6 million in the three months ended ~~January~~July 29, ~~2022. The improvement was due to lower costs in the three months ended January 28, 2023.~~

Medical segment gross profit was a loss of $0.5 million in the nine months ended January 28, 2023 compared to a loss of $0.9 million in the nine months ended January 29, 2022. The improvement was due to lower costs in the nine months ended January 28, 2023.

Medical segment loss from operations increased ~~$0.2~~$0.7 million to ~~$1.8~~$2.2 million in the three months ended ~~January 28,~~July 29, 2023, compared to ~~$1.6~~$1.5 million in the three months ended ~~January 29,~~July 30, 2022. The increase in the loss was primarily due to higher selling and administrative expenses ~~partially offset by higher gross profit.~~

Medical segment loss from operations increased $0.1 million to $4.7 million in the nine months ended January 28, 2023, compared to $4.6 million in the nine months ended January 29, 2022. The increase in the loss was primarily due to higher sellingand restructuring costs. Selling and administrative expenses ~~partially offset by higher gross profit.~~include $0.1 million of restructuring costs recognized in the three months ended July 29, 2023.

Our liquidity requirements are primarily to fund our business operations, including capital expenditures and working capital requirements, as well as to fund debt service requirements, dividends and stock repurchases. Our primary sources of liquidity are cash flows from operations, existing cash balances and borrowings under our senior unsecured credit agreement. We believe our liquidity position will be sufficient to fund our existing operations and current commitments for at least the next twelve months. However, if economic conditions remain impacted for longer than we expect due to ~~the COVID-19 pandemic,~~ supply chain disruptions, inflationary pressure or other geopolitical risks, including the Russia-Ukraine war, our liquidity position could be severely impacted.

As of ~~January 28,~~July 29, 2023, we had ~~$164.7~~$147.9 million of cash and cash equivalents, of which ~~$98.8~~$139.7 million was held in subsidiaries outside the U.S. Cash held by these subsidiaries is used to fund operational activities and can be repatriated, primarily through the payment of dividends and the repayment of intercompany loans, without creating material additional income tax expense.

~~On March 31, 2021, the~~The Board of Directors authorized ~~the~~a program to purchase of up to ~~$100.0~~$200.0 million of our outstanding common ~~stock. On June 16, 2022, the Board of Directors authorized an increase in the existing share buyback program of an additional $100.0 million, and extended the expiration of the program to~~stock through June 14, 2024. Purchases may be made in private transactions or on the open market, including pursuant to purchase plans designed to comply with Rule 10b5-1 of the Securities Exchange Act of 1934. We did not purchase any shares during the three months ended July 29, 2023. As of ~~January 28,~~July 29, 2023, a total of ~~2,598,653~~2,790,375 shares have been purchased at a total cost of ~~$110.8~~$119.3 million since the commencement of the share buyback program. As of ~~January 28,~~July 29, 2023, the dollar value of shares that remained available to be purchased under this share buyback program was ~~$89.2~~$80.7 million.

On October 31, 2022, we entered into a Second Amended and Restated Credit Agreement (the “Credit Agreement”) with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and the Lenders and other parties named therein. The Credit Agreement amends and restates the Amended and Restated Credit Agreement, dated September 12, 2018 and as previously amended (the “Prior Credit Agreement”), with Bank of America, N.A., as Administrative Agent, Swing Line Lender, and L/C Issuer, Wells Fargo Bank, National Association, as L/C Issuer, and the Lenders named therein. Among other things, the Credit Agreement (i) increased the multicurrency revolving credit commitments under the Prior Credit Agreement to $750,000,000, (ii) refinanced in full and terminated the term loan facility under the Prior Credit Agreement, and (iii) made certain other changes to the covenants, terms, and conditions under the Prior Credit Agreement. In addition, the Credit Agreement permits us to increase the revolving commitments and/or add one or more tranches of term loans under the Credit Agreement from time to time by up to an amount equal to (i) $250,000,000 plus (ii) an additional amount so long as the leverage ratio would not exceed 3.00:1.00 on a pro forma basis, subject to, among other things, the receipt of additional commitments from existing and/or new lenders. The Credit Agreement matures on October 31, 2027.

As of ~~January 28,~~July 29, 2023, ~~$200.0~~$337.5 million was outstanding under the revolving credit facility. We were in compliance with all covenants under the Credit Agreement as of ~~January 28,~~July 29, 2023. For further information, see Note 8, “Debt” to the condensed consolidated financial statements included in this ~~Quarterly~~ Report.

Net cash used in operating activities was $5.6 million in the three months ended July 29, 2023, compared to net cash provided by operating activities ~~increased $27.0 million to $83.8~~of $12.7 million in the ~~nine~~three months ended ~~January 28, 2023, compared to $56.8 million in the nine months ended January 29,~~July 30, 2022. The ~~increase~~decrease was due to ~~an improvement in working capital, partially offset by~~ lower net income adjusted for non-cash items. The ~~$33.6~~$24.0 million of cash outflows for operating assets and liabilities in the ~~nine~~three months ended ~~January 28,~~July 29, 2023 was primarily due to higher inventory and lower accounts ~~receivable~~payable and ~~inventory,~~other liabilities, partially offset by ~~higher~~lower accounts ~~payable.~~receivable.

Net cash used in investing activities was ~~$27.3~~$13.8 million in the ~~nine~~three months ended ~~January 28,~~July 29, 2023, compared to ~~$29.0~~$9.6 million in the ~~nine~~three months ended ~~January 29, 2022. Capital expenditures were $30.8 million~~July 30, 2022 and $29.6 million in the nine months ended January 28, 2023 and January 29, 2022, respectively. We received $3.5 million and $0.6 million of cash from the sale of property, plant and equipment in the nine months ended January 28, 2023 and January 29, 2022, respectively.represented capital expenditures.

Net cash provided by financing activities was $12.5 million in the three months ended July 29, 2023, compared to net cash used in financing activities ~~was $63.6~~of $20.8 million in the ~~nine~~three months ended ~~January 28, 2023, compared to $103.8 million in the nine months ended January 29,~~July 30, 2022. In the ~~nine~~three months ended ~~January 28, 2023,~~July 30, 2022, we used ~~$39.6~~$11.9 million of cash for the purchase of shares under our share buyback ~~program, compared to $63.9 million~~program. We did not purchase any of our shares in the ~~nine~~three months ended ~~January~~July 29, ~~2022.~~2023. We paid cash dividends of ~~$14.9~~$5.3 million in the ~~nine~~three months ended ~~January 28,~~July 29, 2023, compared to ~~$15.4~~$5.0 million in the ~~nine~~three months ended ~~January 29,~~July 30, 2022. In the ~~nine~~three months ended ~~January 28,~~July 29, 2023, we had net ~~repayments on our~~ borrowings of ~~$6.6~~$31.9 million, compared to ~~$24.2~~net repayments of borrowings of $3.3 million in the ~~nine~~three months ended ~~January 29,~~July 30, 2022. In addition, we paid ~~$3.2~~$10.2 million for the purchase of ~~debt issuance costs in connection with our Credit Agreement.~~redeemable noncontrolling interests related to Nordic Lights.

See Note 1, “Description of Business and Summary of Significant Accounting Policies” to the condensed consolidated financial statements included in Item 1.

For several years, Hetronic Germany-GmbH and Hydronic-Steuersysteme-GmbH (the “Fuchs companies”) served as our distributors for Germany, Austria and other central and eastern European countries pursuant to their respective intellectual property licenses and distribution and assembly agreements. We became aware that the Fuchs companies and their managing director, Albert Fuchs, had materially violated those agreements. As a result, we terminated all of our agreements with the Fuchs companies. On June 20, 2014, we filed a lawsuit against the Fuchs companies in the Federal District Court for the Western District of Oklahoma alleging material breaches of the distribution and assembly agreements and seeking damages, as well as various forms of injunctive relief. The defendants filed counterclaims alleging breach of contract, interference with business relations and business slander. On April 2, 2015, we amended our complaint against the Fuchs companies to add additional unfair competition and Lanham Act claims and to add additional affiliated parties.

A trial with respect to the matter began in February 2020. During the trial, the defendants dismissed their one remaining counterclaim with prejudice. On March 2, 2020, the jury returned a verdict in favor of the Company. The verdict included approximately $102 million in compensatory damages and $11 million in punitive damages. On April 22, 2020, the District Court entered a permanent injunction barring defendants from selling infringing products and ordering them to return Hetronic’s confidential information. Defendants appealed entry of the permanent injunction. On May 29, 2020, the District Court held defendants in contempt for violating the permanent injunction and entered the final judgment. Defendants appealed entry of the final monetary judgment as well. The appeal of the permanent injunction and the appeal of the final judgment were consolidated into a single appeal before the U.S. Court of Appeals for the Tenth Circuit. On August 24, 2021, the Tenth Circuit issued a decision affirming the lower court’s ruling with the exception that it instructed the District Court to modify the injunction from the entire world to all of the countries in which Hetronic sells its products. On April 20 and 21, 2022, the District Court held a hearing related to modifying the injunction pursuant to the Tenth Circuit’s opinion, and the parties have filed post-hearing briefs. The defendants also filed a petition for certiorari with the United States Supreme Court seeking to further appeal the extraterritorial application of the Lanham Act in this case. We opposed that petition. The Supreme Court requested the views of the Solicitor General on the petition for certiorari, and the Solicitor General recommended granting the petition. On November 4, 2022, the Supreme Court granted the petition. The Supreme Court ~~appeal currently is set for argument~~heard arguments in this matter on March 21, 2023. On June 29, 2023, the Supreme Court vacated the Tenth Circuit’s August 2021 decision and remanded the matter back to the Tenth Circuit for further proceedings. On September 1, 2023, the Tenth Circuit requested supplemental briefing from the parties regarding the effect of the Supreme Court’s decision on the appeal and the proper course of further proceedings. Like any judgment, particularly a judgment involving defendants outside of the United States, there is no guarantee that we will be able to collect all or any portion of the judgment.

In the ~~nine~~three months ended ~~January 28,~~July 29, 2023 and ~~January 29,~~July 30, 2022, we incurred Hetronic-related legal fees of ~~$2.5~~$0.1 million and ~~$1.5~~$0.8 million, respectively. These amounts are included in the selling and administrative expenses in the Industrial segment.

We are exposed to market risks from foreign currency exchange, interest rates, and commodity prices, which could affect our operating results, financial position and cash flows. We manage a portion of these risks through use of derivative financial instruments in accordance with our policies. We do not enter into derivative financial instruments for speculative or trading purposes.

There has been no significant change in our exposure to market risk during the ~~nine~~three months ended ~~January 28,~~July 29, 2023. For a discussion of our exposure to market risk, refer to Item 7A, “Quantitative and Qualitative Disclosures about Market Risk,” contained in our Annual Report on Form 10-K for the year ended April ~~30, 2022.~~29, 2023.

As of the end of the period covered by this quarterly report on Form 10-Q, we performed an evaluation under the supervision and with the participation of the Company’s management, including our Chief Executive Officer (“CEO”) and our Chief Financial Officer (“CFO”), of our “disclosure controls and procedures” (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934). ~~The Company’s~~Our disclosure controls and procedures are designed to ensure that the information required to be disclosed by the Company in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s applicable rules and forms. As a result of this evaluation, our ~~Chief Executive Officer~~CEO and ~~Chief Financial Officer have~~CFO concluded that ~~as of the end of the period covered by this report, the Company’s~~our disclosure controls and procedures were ~~effective.~~not effective as of July 29, 2023 due to the previously reported material weakness that was disclosed in our Annual Report on Form 10-K for the year ended April 29, 2023.

~~There~~Notwithstanding the identified material weakness, management, including our CEO and CFO, believe that the condensed consolidated financial statements contained in this Quarterly Report fairly present, in all material respects, our financial condition, results of operations and cash flows for the fiscal period presented in conformity with GAAP.

As previously disclosed in our Annual Report on Form 10-K for the year ended April 29, 2023, our management concluded that our internal controls over financial reporting were not effective as of April 29, 2023 due to a material weakness. The material weakness related to revenue at a business unit in our Automotive segment. Specifically, we did not maintain effective review, approval and validation controls over pricing data entered into the business unit's financial system and non-standard contract terms.

We are in the process of implementing a plan to address the material weakness. Our remediation plan includes, among other items, (1) enhancing the design and operating effectiveness of internal controls over the review, approval and validation of customer pricing data and non-standard contract terms; and (2) developing and deploying additional training programs around the operation and importance of internal controls. As we continue to evaluate and work to improve our internal control over financial reporting, management may determine to take additional measures to strengthen controls or to modify the remediation plan described above. When fully implemented and operational, we believe the controls we have designed or plan to design will remediate the control deficiency that has led to the material weakness we have identified and strengthen our internal controls over financial reporting. The material weakness will not be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

Except as described above, there have been no changes in our internal control over financial reporting during the ~~quarter~~three months ended ~~January 28,~~July 29, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Our business, financial condition, results of operations and cash flows are subject to various ‎risks which could cause actual results to vary from recent results or from anticipated future results. There have ‎been no material changes to the risk factors previously disclosed in Part I - Item 1A, “Risk Factors” of our Form 10-K for the ‎year ended April ~~30, 2022.~~29, 2023.‎

~~On March 31, 2021, the~~The Board of Directors authorized ~~the~~a program to purchase of up to ~~$100.0~~$200.0 million of the Company’s outstanding common stock through ~~March 31, 2023. On June 16, 2022, the Board of Directors authorized an increase in the share buyback program of an additional $100.0 million, and extended the expiration of the program to~~ June 14, 2024. Purchases may be made in private transactions or on the open market, including pursuant to purchase plans designed to comply with Rule 10b5-1 of the Securities Exchange Act of 1934. As of ~~January 28,~~July 29, 2023, we purchased and retired ~~$110.8~~$119.3 million of common stock since the commencement of the share buyback program.

The following table provides information about our purchases of equity securities during the three months ended ~~January 28, 2023:~~July 29, 2023.

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.


Delaware	36-2090085
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
8750 West Bryn Mawr Avenue, Suite 1000, Chicago, Illinois	60631-3518
(Address of principal executive offices)	(Zip Code)


Title of each Class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.50 Par Value	MEI	New York Stock Exchange


		Page

PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements

	Condensed Consolidated Statements of Income (unaudited) - Three ~~and Nine~~ Months Ended ~~January 28,~~July 29, 2023 and ~~January 29,~~July 30, 2022	2

	Condensed Consolidated Statements of Comprehensive Income (unaudited) - ~~Three and~~ ~~Nine~~Three Months Ended ~~January 28,~~July 29, 2023 and ~~January 29,~~July 30, 2022	3

	Condensed Consolidated Balance Sheets as of ~~January 28,~~July 29, 2023 (unaudited) and April ~~30, 2022~~29, 2023	4

	Condensed Consolidated Statements of Shareholders’ Equity (unaudited) - Three ~~and Nine~~ Months Ended ~~January 28,~~July 29, 2023 and ~~January 29,~~July 30, 2022	5

	Condensed Consolidated Statements of Cash Flows (unaudited) - ~~Nine~~Three Months Ended ~~January 28,~~July 29, 2023 and ~~January 29,~~July 30, 2022	86

	Notes to Condensed Consolidated Financial Statements	97

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2422

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3429

Item 4.	Controls and Procedures	3430

PART II.	OTHER INFORMATION

Item 1A.	Risk Factors	3531

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3531

Item 5.	Other Information	31

Item 6.	Exhibits	3531

SIGNATURES		3632


(in millions)	January 28, 2023		April 30, 2022
Finished products	$	32.2	$	31.8
Work in process		18.7		12.9
Raw materials		124.5		113.8
Total inventories	$	175.4	$	158.5


(in millions)	July 29, 2023		April 29, 2023
Finished products	$	43.1	$	36.6
Work in process		17.5		14.4
Raw materials		115.0		108.7
Total inventories	$	175.6	$	159.7


☒	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


☐	Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


	Nine Months Ended January 29, 2022
	Common stock shares			Common stock			Additional paid-in capital			Accumulated other comprehensive income (loss)			Treasury stock			Retained earnings			Total shareholders' equity
Balance as of May 1, 2021		39,644,913		$	19.8		$	157.6		$	6.1		$	(11.5	)	$	746.0		$	918.0
Issuance of restricted stock, net of tax withholding		44,245			0.1			(0.1	)		—			—			(0.3	)		(0.3	)
Exercise of stock options		13,000			—			0.5			—			—			—			0.5
Purchases of common stock		(1,425,190	)		(0.7	)		—			—			—			(63.0	)		(63.7	)
Stock-based compensation expense		—			—			8.4			—			—			—			8.4
Other comprehensive loss		—			—			—			(16.7	)		—			—			(16.7	)
Net income		—			—			—			—			—			86.0			86.0
Dividends on common stock		—			—			—			—			—			(15.8	)		(15.8	)
Balance as of January 29, 2022		38,276,968		$	19.2		$	166.4		$	(10.6	)	$	(11.5	)	$	752.9		$	916.4


(in millions)
Cash and cash equivalents	$	19.6
Accounts receivable		17.1
Inventories		9.6
Property, plant and equipment		12.9
Identifiable intangible assets		68.1
Accounts payable		(10.8	)
Long-term debt		(24.4	)
Other assets and liabilities, net		(2.8	)
Deferred tax liabilities		(13.4	)
Total identifiable net assets acquired		75.9
Goodwill		69.6
Total fair value of net assets acquired		145.5
Less: redeemable noncontrolling interest		(11.3	)
Total purchase price	$	134.2


	As of January 28, 2023									As of July 29, 2023
(in millions)	Gross		Accumulated amortization			Net		Weighted average useful life (years)		Gross		Accumulated amortization			Net		Weighted average remaining useful life (years)
Amortized intangible assets:
Customer relationships and agreements	$	232.2	$	(64.9	)	$	167.3		14.0	$	285.3	$	(72.3	)	$	213.0		14.6
Trade names, patents and technology licenses		57.9		(33.7	)		24.2		5.7		73.5		(37.0	)		36.5		6.9
Total amortized intangible assets		290.1		(98.6	)		191.5				358.8		(109.3	)		249.5
Unamortized trade name		1.8		—			1.8				1.8		—			1.8
Total other intangible assets	$	291.9	$	(98.6	)	$	193.3			$	360.6	$	(109.3	)	$	251.3


	As of April 30, 2022									As of April 29, 2023
(in millions)	Gross		Accumulated amortization			Net		Weighted average useful life (years)		Gross		Accumulated amortization			Net		Weighted average remaining useful life (years)
Amortized intangible assets:
Customer relationships and agreements	$	232.3	$	(55.1	)	$	177.2		14.7	$	286.7	$	(68.2	)	$	218.5		14.8
Trade names, patents and technology licenses		58.0		(29.3	)		28.7		6.2		71.6		(35.2	)		36.4		6.0
Total amortized intangible assets		290.3		(84.4	)		205.9				358.3		(103.4	)		254.9
Unamortized trade name		1.8		—			1.8				1.8		—			1.8
Total other intangible assets	$	292.1	$	(84.4	)	$	207.7			$	360.1	$	(103.4	)	$	256.7


(in millions)
Fiscal Year:
Remainder of 2023	$	4.7
2024		18.5
Remainder of 2024			$	17.2
2025		17.9		22.4
2026		17.1		21.6
2027		16.4		20.9
2028				18.6
Thereafter		116.9		148.8
Total	$	191.5	$	249.5


		Asset/(Liability)
(in millions)	Financial Statement Caption	January 28, 2023			April 30, 2022
Derivatives designated as hedging instruments:
Net investment hedges	Prepaid expenses and other current assets	$	0.5		$	—
Net investment hedges	Other long-term assets	$	—		$	1.9
Interest rate swaps	Prepaid expenses and other current assets	$	2.7		$	—
Interest rate swaps	Other long-term assets	$	—		$	3.0
Derivatives not designated as hedging instruments:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	1.5		$	—
Foreign currency forward contracts	Other accrued liabilities	$	(0.4	)	$	(0.2	)


Period	Total number of shares purchased		Average price paid per share		Total number of shares purchased as part of publicly announced plan		Approximate dollar value of shares that may yet be purchased under the program (in millions)
October 30, 2022 through November 26, 2022		76,500	$	43.86		76,500	$	93.8
November 27, 2022 through December 31, 2022		81,565	$	45.12		81,565	$	90.2
January 1, 2023 through January 28, 2023		21,635	$	44.75		21,635	$	89.2


Exhibit Number		Description

~~10.1~~10.1**		~~Second Amended and Restated Credit~~Long-Term Performance-Based Award Agreement ~~entered into~~dated as of ~~October 31,~~September 14, 2022 ~~among Methode Electronics, Inc., each Lender party thereto,~~between the Company and Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer and the other parties thereto (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on November 1, 2022).Kerry Vyverberg.
~~10.2~~10.2**		~~Form~~Long-Term Time-Based Award Agreement dated as of ~~Amendment to Change in Control Agreement (CEO) (incorporated by reference to Exhibit 10.1 to~~September 14, 2022 between the ~~Company's Current Report on Form 8-K filed on December 19, 2022).~~Company and Kerry Vyverberg.
~~10.3~~10.3**		~~Form~~Restricted Stock Unit Award Agreement effective as of ~~Amendment to~~ June 16, 2021 between the Company and Kerry Vyverberg.
10.4**		Change in Control Agreement ~~(NEOs Other Than CEO) (incorporated by reference to Exhibit 10.2 to~~dated as of March 16, 2022 between the ~~Company's Current Report on Form 8-K filed on December 19, 2022).~~Company and Kerry Vyverberg.
31.1		Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer.
31.2		Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer.
32*		Certification of Periodic Financial Report Pursuant to 18 U.S.C. Section 1350.
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


*		Indicates that the exhibit is being furnished with this report and not filed as part of it.
**		Management compensatory plan.


		METHODE ELECTRONICS, INC.

		By:	/s/ Ronald L.G. Tsoumas
			Ronald L.G. Tsoumas
			Chief Financial Officer
			(Principal Financial Officer)

Dated:	~~March 9,~~September 7, 2023

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company