ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
You should read the following discussion in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2025 (“Annual Report”) as filed on February 24, 2026 with the U.S. Securities and Exchange Commission (“SEC”) and the Notes to Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report on Form 10-Q (“Quarterly Report”).
Information About Forward-Looking Statements
This report includes “forward-looking statements” within the meaning of the federal securities laws. In addition, we, or our executive officers on our behalf, may from time to time make forward-looking statements in reports and other documents we file with the SEC or in connection with oral statements made to the press, potential investors, or others. All statements that are not historical facts are “forward-looking statements.” Forward-looking statements may be indicated by words or phrases such as “anticipate,” “estimate,” “plans,” “expects,” “projects,” “should,” “will,” “believes,” “intends,” and similar words and phrases. These statements reflect management’s current beliefs and are not guarantees of future performance. They involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in any forward-looking statement.
Examples of forward-looking statements in this report include but are not limited to statements regarding operating results, the success of our operating plans, our expectations regarding our ability to generate cash and reduce debt and associated interest expense, profit and cash flow expectations, the prospects for newly acquired businesses to be integrated and contribute to future growth, and our expectations regarding growth through acquisitions. Important assumptions relating to the forward-looking statements include, among others, demand for our products, the cost, timing, and success of product upgrades and new product introductions, raw materials costs, expected pricing levels, expected outcomes of pending litigation, competitive conditions, and general economic conditions. These assumptions could prove inaccurate. Although we believe that the estimates and projections reflected in the forward-looking statements are reasonable, our expectations may prove to be incorrect. Important factors that could cause actual results to differ materially from estimates or projections contained in the forward-looking statements include but are not limited to:
•general economic conditions;
•difficulty making acquisitions, including receiving the necessary regulatory approvals (including clearance under the Hart-Scott-Rodino Act in the United States (“U.S.”) and similar antitrust regulations in foreign countries), and successfully integrating acquired businesses;
•any unforeseen liabilities associated with future acquisitions;
•information technology (IT) system failures, data security breaches, network disruptions, and cybersecurity events, including any litigation arising therefrom;
•failure to comply with new data privacy laws and regulations, including any litigation arising therefrom;
•risks and costs associated with our international sales and operations;
•volatile interest rates;
•limitations on our business imposed by our indebtedness;
•product liability, litigation, and insurance risks;
•future competition;
•reduction of business with large customers;
•risks associated with government contracts;
•changes in the supply of, or price for, labor, energy, raw materials, parts, and components, including as a result of inflation or potential supply chain constraints;
•potential write-offs of our goodwill and other intangible assets;
•our ability to successfully develop new products;
•risks associated with the use of artificial intelligence (“AI”), including our ability to develop, deploy, and use AI in our platforms and offerings;
•failure to protect our intellectual property;
•unfavorable changes in foreign exchange rates;
•risks related to changing U.S. and foreign trade policies, including increased trade restrictions or tariffs (including the non-renewal or a repeal of the United States-Mexico-Canada Agreement);
•increased warranty exposure;
•environmental compliance costs and liabilities;
•the effect of, or change in, government regulations (including tax);
•the impacts of any U.S. government shutdowns;
•economic disruption caused by armed conflicts (such as the conflicts in Ukraine and the Middle East), terrorist attacks, health crises, or other unforeseen geopolitical events; and
•the factors discussed in other reports we file with the SEC from time to time.
You should not place undue reliance on any forward-looking statements, which are based on current expectations. Further, forward-looking statements speak only as of the date they are made, and we undertake no obligation to publicly update any of these statements in light of new information or future events.
Overview
Roper is a diversified technology company. Roper has a proven, long-term, successful track record of compounding cash flow and increasing shareholder value. We operate market leading businesses that design and develop vertical software and technology enabled products for a variety of defensible niche markets.
We pursue consistent and sustainable growth in revenue, earnings, and cash flow by enabling continuous improvement in the operating performance of our businesses and by acquiring other businesses that offer high value-added software, services, technology-enabled products, and solutions that we believe are capable of realizing growth while maintaining high margins.
Critical Accounting Policies
Except as described in Note 10 with respect to our equity investment in Indicor, there were no material changes during the six months ended June 30, 2026 to the items that we disclosed as our critical accounting policies and estimates in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report.
Recently Issued Accounting Standards
Information regarding new accounting pronouncements can be found in Note 2 of the Notes to Condensed Consolidated Financial Statements.
Results of Operations
All currency amounts are in millions, percentages are of net revenues
Percentages may not sum due to rounding.
The following table sets forth selected information for the periods indicated:
| | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended
June 30, | | Six months ended
June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Net revenues: | | | | | | | |
| Application Software | $ | 1,180.8 | | | $ | 1,094.9 | | | $ | 2,372.3 | | | $ | 2,163.1 | |
| Network Software | 430.9 | | | 385.4 | | | 858.5 | | | 761.3 | |
| Technology Enabled Products | 497.2 | | | 463.3 | | | 973.4 | | | 902.0 | |
| | | | | | | |
| Total | $ | 2,108.9 | | | $ | 1,943.6 | | | $ | 4,204.2 | | | $ | 3,826.4 | |
| | | | | | | |
| Gross margin: | | | | | | | |
| Application Software | 69.8 | % | | 68.8 | % | | 69.4 | % | | 68.1 | % |
| Network Software | 84.3 | % | | 83.2 | % | | 84.3 | % | | 83.6 | % |
| Technology Enabled Products | 56.9 | % | | 58.6 | % | | 56.9 | % | | 58.6 | % |
| | | | | | | |
| Total | 69.7 | % | | 69.2 | % | | 69.5 | % | | 69.0 | % |
| | | | | | | |
| Selling, general and administrative expenses: | | | | | | | |
| Application Software | (42.3) | % | | (41.9) | % | | (42.3) | % | | (41.7) | % |
| Network Software | (43.4) | % | | (39.3) | % | | (43.5) | % | | (39.5) | % |
| Technology Enabled Products | (23.6) | % | | (23.1) | % | | (24.0) | % | | (23.4) | % |
| | | | | | | |
| Total | (38.1) | % | | (36.9) | % | | (38.3) | % | | (37.0) | % |
| | | | | | | |
| Segment operating margin: | | | | | | | |
| Application Software | 27.4 | % | | 26.9 | % | | 27.1 | % | | 26.4 | % |
| Network Software | 41.0 | % | | 43.9 | % | | 40.8 | % | | 44.1 | % |
| Technology Enabled Products | 33.3 | % | | 35.4 | % | | 32.9 | % | | 35.2 | % |
| | | | | | | |
| Total | 31.6 | % | | 32.3 | % | | 31.2 | % | | 32.0 | % |
| | | | | | | |
Corporate administrative expenses * | (3.9) | % | | (4.1) | % | | (3.8) | % | | (3.9) | % |
| Income from operations | 27.7 | % | | 28.2 | % | | 27.5 | % | | 28.1 | % |
| Interest expense, net | (5.3) | % | | (4.1) | % | | (5.0) | % | | (3.7) | % |
| Equity investment gain (loss), net | 39.6 | % | | 0.9 | % | | 23.8 | % | | (0.7) | % |
| Other expense, net | — | % | | — | % | | (0.1) | % | | — | % |
| Earnings before income taxes | 62.0 | % | | 25.0 | % | | 46.2 | % | | 23.6 | % |
| Income taxes | (6.6) | % | | (5.5) | % | | (6.3) | % | | (5.1) | % |
| | | | | | | |
| | | | | | | |
| Net earnings | 55.4 | % | | 19.5 | % | | 39.9 | % | | 18.5 | % |
* Includes unallocated corporate general and administrative expenses and enterprise-wide stock-based compensation.
Three Months Ended June 30, 2026 compared to the Three Months Ended June 30, 2025
Net revenues for the three months ended June 30, 2026 were $2,108.9 as compared to $1,943.6 for the three months ended June 30, 2025, an increase of 8.5%. The components of revenue growth for the three months ended June 30, 2026 were as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Application Software | | Network Software | | Technology Enabled Products | | | | Roper |
| Total Revenue Growth | 7.8 | % | | 11.8 | % | | 7.3 | % | | | | 8.5 | % |
| Less Impacts of: | | | | | | | | | |
| Acquisitions | 3.1 | | | 8.2 | | | — | | | | | 3.4 | |
| Foreign Exchange | 0.2 | | | — | | | 0.2 | | | | | 0.2 | |
| | | | | | | | | |
| Organic Revenue Growth | 4.5 | % | | 3.6 | % | | 7.1 | % | | | | 4.9 | % |
In our Application Software segment, net revenues in the second quarter of 2026 grew 7.8% to $1,180.8 as compared to $1,094.9 in the second quarter of 2025. The growth of 4.5% in organic revenues was broad-based across the segment, led by our application software businesses serving the legal, project-based private sector, property and casualty insurance, higher education, and acute healthcare markets. Growth from acquisitions was led by our 2025 acquisitions of CentralReach and Orchard Software. Gross margin increased to 69.8% in the second quarter of 2026 as compared to 68.8% in the second quarter of 2025 due primarily to improved leverage on higher organic revenues. SG&A expenses as a percentage of net revenues increased to 42.3% in the second quarter of 2026 as compared to 41.9% in the second quarter of 2025 due primarily to higher amortization of acquired intangibles from the 2025 acquisition of CentralReach, partially offset by improved operating leverage on higher revenues. As a result, operating margin was 27.4% in the second quarter of 2026 as compared to 26.9% in the second quarter of 2025.
In our Network Software segment, net revenues in the second quarter of 2026 grew 11.8% to $430.9 as compared to $385.4 in the second quarter of 2025, led by contributions from 2025 acquisitions, most notably Subsplash. The growth of 3.6% in organic revenues was led by our network software businesses serving the freight match, construction, and media and entertainment markets. These increases were partially offset by declines in our alternate site group purchasing business and non-recurring professional services revenue at our business serving the life insurance/annuities market. Gross margin increased to 84.3% in the second quarter of 2026 as compared to 83.2% in the second quarter of 2025 due primarily to lower amortization associated with fully amortized acquired intangibles, partially offset by margin profiles associated with our 2025 acquisitions, most notably payments revenue mix from Subsplash as well as the Convoy platform within our freight match software business. SG&A expenses as a percentage of net revenues increased to 43.4% in the second quarter of 2026 as compared to 39.3% in the second quarter of 2025 due primarily to SG&A profiles associated with our 2025 acquisitions, including higher amortization of acquired intangibles. As a result, operating margin was 41.0% in the second quarter of 2026 as compared to 43.9% in the second quarter of 2025.
In our Technology Enabled Products segment, net revenues in the second quarter of 2026 grew 7.3% to $497.2 as compared to $463.3 in the second quarter of 2025. The growth of 7.1% in organic revenues was led by our medical products businesses, highlighted by our precision measurement and airway management businesses. These increases were partially offset by an expected decline in our water meter technology business. Gross margin decreased to 56.9% in the second quarter of 2026 as compared to 58.6% in the second quarter of 2025 due primarily to input cost pressures at our water meter technology business and revenue mix within our medical products businesses weighted more towards consumables. SG&A expenses as a percentage of net revenues increased to 23.6% in the second quarter of 2026 as compared to 23.1% in the second quarter of 2025 due primarily to reduced operating leverage associated with our water meter technology business. The resulting operating margin was 33.3% in the second quarter of 2026 as compared to 35.4% in the second quarter of 2025.
Corporate expenses increased to $81.6 in the second quarter of 2026 as compared to $79.7 in the second quarter of 2025. The dollar increase was due primarily to higher stock-based compensation expense, partially offset by lower acquisition-related expenses. As a percentage of net revenues, corporate expenses decreased to 3.9% of net revenues in the second quarter of 2026 as compared to 4.1% of net revenues in the second quarter of 2025.
Interest expense, net, increased to $111.4 for the second quarter of 2026 as compared to $79.1 for the second quarter of 2025 due primarily to higher average debt balances and a higher weighted-average interest rate on our senior notes.
Equity investment activity, net, was a gain of $835.2 in the second quarter of 2026 due primarily to an $828.6 increase in the fair value of our equity investment in Indicor. The increase was primarily due to updated valuation assumptions made in anticipation of Indicor’s planned divestiture of its portfolio of instrumentation businesses (“Indicor Instrumentation”). Equity investment activity, net, was a gain of $16.6 in the second quarter of 2025 due to an increase in the fair value of our equity investment in Indicor and dividend distributions received from Indicor.
Income taxes as a percentage of pretax earnings decreased to 10.7% for the second quarter of 2026 as compared to 22.0% for the second quarter of 2025, primarily due to net tax benefits recognized in connection with a change in our outside basis in Indicor, resulting from the Indicor Instrumentation transaction described above, and legal entity restructuring.
Backlog is equal to our remaining performance obligations expected to be recognized as revenue within the next 12 months as discussed in Note 13 of the Notes to Condensed Consolidated Financial Statements. Backlog increased 11.0% to $3,286.0 at June 30, 2026 as compared to $2,961.3 at June 30, 2025 due primarily to acquisitions and organic growth in our software segments.
| | | | | | | | | | | |
| Backlog as of June 30, |
| 2026 | | 2025 |
| Application Software | $ | 2,368.5 | | | $ | 2,129.3 | |
| Network Software | 608.4 | | | 534.0 | |
| Technology Enabled Products | 309.1 | | | 298.0 | |
| Total | $ | 3,286.0 | | | $ | 2,961.3 | |
Six Months Ended June 30, 2026 compared to the Six Months Ended June 30, 2025
Net revenues for the six months ended June 30, 2026 were $4,204.2 as compared to $3,826.4 for the six months ended June 30, 2025, an increase of 9.9%. The components of revenue growth for the six months ended June 30, 2026 were as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Application Software | | Network Software | | Technology Enabled Products | | | | Roper |
| Total Revenue Growth | 9.7 | % | | 12.8 | % | | 7.9 | % | | | | 9.9 | % |
| Less Impacts of: | | | | | | | | | |
| Acquisitions | 4.3 | | | 8.1 | | | 0.3 | | | | | 4.1 | |
| Foreign Exchange | 0.6 | | | 0.3 | | | 0.5 | | | | | 0.5 | |
| Organic Revenue Growth | 4.8 | % | | 4.4 | % | | 7.1 | % | | | | 5.3 | % |
| | | | | | | | | |
In our Application Software segment, net revenues in the six months ended June 30, 2026 grew 9.7% to $2,372.3 as compared to $2,163.1 in the six months ended June 30, 2025. The growth of 4.8% in organic revenues was broad-based across the segment, led by our application software businesses serving the legal, project-based private sector, higher education, and property and casualty insurance markets. Growth from acquisitions was led by our 2025 acquisition of CentralReach. Gross margin increased to 69.4% in the six months ended June 30, 2026 as compared to 68.1% in the six months ended June 30, 2025 due primarily to improved leverage on higher organic revenues as well as revenue mix. SG&A expenses as a percentage of net revenues increased to 42.3% in the six months ended June 30, 2026 as compared to 41.7% in the six months ended June 30, 2025, due primarily to higher amortization of acquired intangibles from the 2025 acquisition of CentralReach, partially offset by improved operating leverage on higher organic revenues. As a result, operating margin was 27.1% in the six months ended June 30, 2026 as compared to 26.4% in the six months ended June 30, 2025.
In our Network Software segment, net revenues in the six months ended June 30, 2026 grew 12.8% to $858.5 as compared to $761.3 in the six months ended June 30, 2025, led by contributions from 2025 acquisitions, most notably Subsplash. The growth of 4.4% in organic revenues was broad-based across the segment, led by our network software businesses serving the freight match, construction, and media and entertainment markets. Gross margin increased to 84.3% in the six months ended June 30, 2026 as compared to 83.6% in the six months ended June 30, 2025 due primarily to lower amortization associated with fully amortized acquired intangibles, partially offset by margin profiles associated with our 2025 acquisitions, most notably payments revenue mix from Subsplash as well as the Convoy platform within our freight match software business. SG&A expenses as a percentage of net revenues increased to 43.5% in the six months ended June 30, 2026 as compared to 39.5% in the six months ended June 30, 2025 due primarily to SG&A profiles associated with our 2025 acquisitions, including higher
amortization of acquired intangibles. As a result, operating margin was 40.8% in the six months ended June 30, 2026 as compared to 44.1% in the six months ended June 30, 2025.
In our Technology Enabled Products segment, net revenues in the six months ended June 30, 2026 grew 7.9% to $973.4 as compared to $902.0 in the six months ended June 30, 2025. The growth of 7.1% in organic revenues was led by our medical products businesses, highlighted by our precision measurement and airway management businesses. These increases were partially offset by a decline in our water meter technology business. Gross margin decreased to 56.9% in the six months ended June 30, 2026 as compared to 58.6% in the six months ended June 30, 2025 due primarily to revenue mix within our medical products businesses weighted more towards consumables and input cost pressures at our water meter technology business. SG&A expenses as a percentage of net revenues increased to 24.0% in the six months ended June 30, 2026 as compared to 23.4% in the six months ended June 30, 2025 due primarily to reduced operating leverage associated with our water meter technology business. The resulting operating margin was 32.9% in the six months ended June 30, 2026 as compared to 35.2% in the six months ended June 30, 2025.
Corporate expenses increased to $159.4 in the six months ended June 30, 2026 as compared to $151.0 in the six months ended June 30, 2025. The dollar increase was due primarily to higher stock-based compensation expense, partially offset by a reduction in fees for professional services and lower acquisition-related expenses. As a percentage of net revenues, corporate expenses decreased to 3.8% of net revenues in the six months ended June 30, 2026 as compared to 3.9% of net revenues in the six months ended June 30, 2025.
Interest expense, net, increased to $210.7 for the six months ended June 30, 2026 as compared to $142.0 for the six months ended June 30, 2025 due primarily to higher average debt balances and a higher weighted-average interest rate on our senior notes.
Equity investment activity, net, was a gain of $1,002.5 in the six months ended June 30, 2026 due primarily to a $995.9 increase in the fair value of our equity investment in Indicor. The increase was primarily due to updated valuation assumptions made in anticipation of the closing of the Indicor Instrumentation transaction. Equity investment activity, net, was a loss of $27.8 in the six months ended June 30, 2025 due primarily to a $32.6 decrease in the fair value of our equity investment in Indicor, partially offset by dividend distributions received from Indicor.
Income taxes as a percentage of pretax earnings decreased to 13.7% for the six months ended June 30, 2026 as compared to 21.5% for the six months ended June 30, 2025, primarily due to net tax benefits recognized in connection with a change in our outside basis in Indicor, resulting from the Indicor Instrumentation transaction, and legal entity restructuring.
Financial Condition, Liquidity, and Capital Resources
All currency amounts are in millions, except per share data or as otherwise specified
Selected cash flows for the six months ended June 30, 2026 and 2025 were as follows:
| | | | | | | | | | | |
| Six months ended June 30, |
| Cash provided by (used in): | 2026 | | 2025 |
| Operating activities | $ | 1,061.6 | | | $ | 932.8 | |
| Investing activities | $ | (72.3) | | | $ | (2,051.3) | |
| Financing activities | $ | (905.1) | | | $ | 1,140.2 | |
| | | |
Operating activities
Net cash provided by operating activities increased by 14% to $1,061.6 in the six months ended June 30, 2026 as compared to $932.8 in the six months ended June 30, 2025 due primarily to lower cash income taxes paid, as 2025 included $30.2 of cash taxes paid associated with our sale of an equity method investment, and higher net earnings before non-cash expenses.
Investing activities
Cash used in investing activities during the six months ended June 30, 2026 was primarily for capitalized software expenditures, capital expenditures, and a business acquisition. Cash used in investing activities during the six months ended June 30, 2025 was primarily for the acquisitions of CentralReach, Muni-Link, and Outgo.
Financing activities
Cash used in financing activities during the six months ended June 30, 2026 primarily consisted of repurchases of our common stock as well as dividend payments, partially offset by net borrowings under our unsecured revolving credit facility. Cash provided by financing activities during the six months ended June 30, 2025 was primarily from net borrowings under our unsecured revolving credit facility to fund the acquisition of CentralReach, and net proceeds from stock-based compensation, partially offset by dividend payments.
Net working capital
Net working capital (total current assets, excluding cash, less total current liabilities, excluding debt) was negative $1,198.6 at June 30, 2026 as compared to negative $1,389.7 at December 31, 2025. The change in net working capital was primarily driven by a decrease in deferred revenue predominantly due to the timing of SaaS renewals associated with our Frontline business, and the timing of payments associated with incentive compensation, partially offset by a decrease in accounts receivable.
Debt
Total debt consisted of the following:
| | | | | |
| As of June 30, 2026 |
| Fixed-rate senior notes | $ | 8,500.0 | |
| Unsecured revolving credit facility | 2,850.0 | |
| Other debt | 18.6 | |
| Less: Deferred financing costs | (49.2) | |
| Total debt, net of deferred financing costs | 11,319.4 | |
| Less: Current portion, net of deferred financing costs | (718.3) | |
| Long-term debt, net of deferred financing costs | $ | 10,601.1 | |
On March 30, 2026, the Company entered into the Credit Agreement, which replaced the previous $3,500.0 unsecured credit facility, dated as of July 21, 2022. The Credit Agreement comprises a five-year $3,500.0 unsecured revolving credit facility, which includes availability of up to $150.0 for letters of credit. Loans under the unsecured credit facility are available in dollars, and letters of credit will be available in dollars and other currencies to be agreed. We may also, subject to compliance with specified conditions, request additional term loans or revolving credit commitments in an aggregate amount not to exceed $1,000.0.
The interest rate on borrowings under the new $3,500.0 unsecured revolving credit facility is calculated based upon various recognized indices plus a margin as defined in the Credit Agreement. At June 30, 2026, we had $7.0 of outstanding letters of credit.
We expect existing cash balances, together with cash generated by our operations and amounts available under our credit facility, will be sufficient to fund our operating requirements for the foreseeable future.
We were in compliance with all debt covenants related to our new and previous unsecured credit facilities throughout their respective periods of effectiveness during the six months ended June 30, 2026.
Total debt, net of deferred financing costs was $11,319.4 at June 30, 2026 as compared to $9,301.0 at December 31, 2025. Our total debt increased at June 30, 2026 as compared to December 31, 2025 due primarily to net borrowings of $2,000.0 on our unsecured revolving credit facility. Our leverage is presented in the following table:
| | | | | | | | | | | |
| June 30,
2026 | | December 31,
2025 |
| Total debt, net of deferred financing costs | $ | 11,319.4 | | | $ | 9,301.0 | |
| Less: Cash and cash equivalents | (364.9) | | | (297.4) | |
| Net debt | 10,954.5 | | | 9,003.6 | |
| Stockholders’ equity | 18,700.3 | | | 19,881.5 | |
| Total net capital | $ | 29,654.8 | | | $ | 28,885.1 | |
| | | |
| Net debt / Total net capital | 36.9 | % | | 31.2 | % |
Foreign cash, and cash equivalents
In relation to our total cash and cash equivalents, amounts held at our foreign subsidiaries represented 47.8% or $174.6 at June 30, 2026 as compared to 57.6% or $171.2 at December 31, 2025. The increase in the amount of foreign cash and cash equivalents was primarily due to cash generated at our foreign subsidiaries during the six months ended June 30, 2026, partially offset by cash repatriation of $140.0. We intend to repatriate substantially all historical and future foreign earnings that can be repatriated without incremental U.S. federal tax cost.
Capitalized expenditures
Capital expenditures were $25.3 for the six months ended June 30, 2026 as compared to $26.0 for the six months ended June 30, 2025. Capitalized software expenditures were $30.9 for the six months ended June 30, 2026 as compared to $26.8 for the six months ended June 30, 2025. We expect the aggregate of capital expenditures and capitalized software expenditures for 2026 to be comparable to prior years as a percentage of net revenues.
Tax legislation
On July 4, 2025, the U.S. government enacted H.R. 1, the One Big Beautiful Bill Act, which introduced tax reform provisions that amend, eliminate, or extend certain tax rules under the Inflation Reduction Act and the Tax Cuts and Jobs Act. Legislative changes include the repeal of the requirement to capitalize and amortize domestic research and development expenditures under Internal Revenue Code Section 174. The legislation includes multiple effective dates and, as enacted, did not have a material impact on our effective tax rates for the three or six months ended June 30, 2026, and is not expected to have a significant impact on our annual effective tax rate in full year 2026 or thereafter.
Share repurchase program
In April 2026, our Board approved an additional $3,000.0 in share repurchase authorization under the share repurchase program.
During the six months ended June 30, 2026, we repurchased 7.865 shares of our common stock for an aggregate purchase price of $2,724.1 and an average price paid per share of $346.34, excluding excise tax and broker commissions. As of June 30, 2026, $2,775.9 of the total amount authorized under the share repurchase program remained available for future repurchases.
Planned Indicor Instrumentation transaction
In connection with our equity investment in Indicor, following closing of the planned Indicor Instrumentation transaction, Roper expects to receive pre-tax cash proceeds of approximately $1.3 billion (estimated $1.1 billion net of income taxes), including current estimates for purchase price adjustments and transaction costs which are subject to finalization.
Outlook
Current geopolitical and economic uncertainties, including inflation, tariffs and changes in trade policy, supply chain disruptions, and labor shortages, could adversely affect our business prospects. An armed conflict (such as the ongoing conflicts in Ukraine and the Middle East), significant terrorist attack, other global conflict, widespread cybersecurity event or information technology system failure, or public health crisis could cause changes in world economies that would adversely affect us. It is impossible to isolate each of these potential factor’s future effects on current economic conditions or any of our businesses. It is also impossible to predict with any reasonable degree of certainty what or when any additional events may occur that also would similarly disrupt the economy and have an adverse impact on our businesses.
We believe that internally generated cash flows and the remaining availability under our unsecured credit facility will be adequate to finance our normal operating requirements. We maintain an active acquisition program; however, future acquisitions will be dependent on numerous factors and it is not feasible to reasonably estimate if or when any such acquisitions will occur and what the impact will be on our business, financial condition, and results of operations. Such acquisitions may be financed by the use of existing credit agreements, future cash flows from operations, future divestitures, the proceeds from the issuance of new debt or equity securities, or any combination of these methods, the terms and availability of which will be subject to market and economic conditions generally.
We anticipate that our businesses will generate positive cash flows from operating activities, and that these cash flows will permit the reduction of currently outstanding debt in accordance with the repayment schedule. However, the rate at which we can reduce our debt (and reduce the associated interest expense) will be affected by, among other things, the financing and operating requirements of any new acquisitions, the financial performance of our existing companies, any allocation of capital toward share repurchases, the impact of the aforementioned geopolitical and economic uncertainties, and the financial markets generally. None of these factors can be predicted with certainty.