Novanta

(1)
A non-GAAP financial measures. Reconciliations of GAAP to non-GAAP financial measures can be found beginning on page 107.
Dear Fellow Shareholders,
At Novanta, our mission is to be a trusted sole-sourced technology partner to leading global original equipment manufacturers
(OEMs), improving end-user productivity in medical and advanced industrial markets. Novanta’s proprietary products and
technologies are well positioned in applications with long-term secular tailwinds, such as precision manufacturing, robotics and
automation, advanced surgery, and precision medicine. Our winning growth strategy is focused on increasing content in these high
growth markets through new innovations and design wins with market-leading OEMs, as well as compounding our growth through
acquisitions. Our performance has been resilient under multiple geopolitical and macroeconomic scenarios, founded on strong
customer relationships, a strong and diversified portfolio, our sticky business model, and our efforts to institutionalize the Novanta
Growth System (NGS) deep into our company culture. We believe our playbook will continue to drive robust performance through the
economic cycles, and deliver predictable, consistent, long-term growth and shareholder value, no matter the environment.
Novanta achieved solid financial results for the full year 2024, effectively navigating a persistently challenging environment. We
delivered $949 million in revenue, representing 8% reported growth, which was driven by the impact of our acquisition of Motion
Solutions at the beginning of the year. On an organic(1) basis, sales declined (2%) for the year, due to choppy market demand in life
science and industrial end markets. We had strong operating performance, achieving Adjusted Gross Margins of 47%, with our core
businesses expanding margins by roughly 120 basis points. Adjusted EBITDA(1) for the full year was $210 million, growing 7% year-
over-year. We achieved record Operating Cash Flow of $159 million, up 32% year-over-year.
In the year, we launched 15 new products, and received initial orders from our customers supporting our new product revenue ramp in
2025 and beyond. Some highlights include: launching multiple new next generation smoke-evacuation insufflators with leading
medical device OEMs; launching a new endoscopic pump product, with more next generation pumps ready for launch in the near
future; launching multiple new components designed for advanced robotics applications such as warehouse automation and humanoid
robotics. Across all our end markets, we continue to stay focused on gaining content and share in multiple high-growth application
areas, particularly in medical end markets, based on a robust innovation pipeline over the coming years. Based on the strength of these
new product launches, we have sustained confidence in Novanta’s long-term organic growth outlook.
We continue to invest in our company culture, which we call the Novanta Way. Our focus is on giving our employees a sense of
belonging within the company, and on improving employment engagement. One of the most critical aspects of our company culture is
using NGS to drive excellence into the many ways we work together. In 2024, we leveraged NGS to enhance performance across our
factory teams, commercial organization, R&D, and product management. We doubled the number of Kaizen events and trained over
100 employees as NGS practitioners, driving continuous improvement. These efforts significantly boosted our operations by speeding
up product launches, reducing lead times and inventory, improving gross margins, and expanding our commercial funnel with new
OEM opportunities. NGS is integral to Novanta’s identity, fostering cross functional teamwork and effective problem-solving.
At Novanta, acquisitions remain our number one capital allocation priority. In the last 10 years we have executed 20 transactions and
deployed over $1.1 billion of capital. In 2024, we closed the Motion Solutions acquisition, which is an attractive business that makes
advanced motion control subsystems, mainly for OEM customers in the life science market. The integration of Motion Solutions has
gone smoothly, and we feel the long-term outlook for this business is solid. We maintain a large and exciting pipeline of potential
targets and our balance sheet is well positioned for sizeable transactions as we head into 2025.
We have also made some significant organizational changes to better prepare for scaling Novanta organically and inorganically. As of
January 2025, we have appointed two Co-Chief Operating Officers to the Novanta Leadership team, who will be responsible for
organic growth strategies, driving the Novanta Growth Systems and other enterprise initiatives and for creating a robust organization
capability and capacity to receive new acquisitions. The Automation Enabling Technologies segment will be led by Chuck Ravetto.
We are also excited to welcome John Lesica to Novanta, who will be responsible for the Medical Solutions segment.
In summary, Novanta delivered solid operating performance in 2024 while navigating a difficult macroeconomic environment. The
fundamentals of Novanta are strong, and we remain confident in our strategy, in our portfolio, our exposure to diversified end-markets,
and in our ability to generate strong operating cash flows to compound our growth through our targeted acquisition strategy. As we
look to 2025, we have three priorities: first, ramp all our planned new products; second, further expand our margins and cashflows
using NGS; and third, continue to acquire additional companies that fit our strategy, at attractive returns.
In closing, as always, I would like to thank our customers, our employees, and our shareholders, for their ongoing support. I am
particularly grateful to our dedicated Novanta teammates, and am inspired by their persistent efforts to live the Novanta values and go
above and beyond our expectations. Our achievements couldn’t happen without them.
Yours truly,
/s/ Matthijs Glastra
Chair of the Board of Directors and Chief Executive Officer
April 25, 2025


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
☑
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2024
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from
to
Commission File No. 001-35083
NOVANTA INC.
(Exact name of registrant as specified in its charter)
New Brunswick, Canada
98-0110412
(State or other jurisdiction
of incorporation or organization)
(I.R.S. Employer
Identification No.)
125 Middlesex Turnpike
01730
Bedford, Massachusetts, USA
(Zip Code)
(Address of principal executive offices)
(781) 266-5700
(Registrant’s telephone number, including area code)
Securities Registered Pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common shares, no par value
NOVT
The Nasdaq Global Select Market
Securities Registered Pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
YES ☑NO ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
YES ☐
NO ☑
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90
days.
YES ☑NO ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YES ☑NO ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging
growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the
Exchange Act.
Large Accelerated Filer
☑
Accelerated Filer
☐
Non-accelerated Filer
☐
Smaller reporting company
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised
financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over
financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
☑
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect
the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of
the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
YES ☐
NO ☑
The aggregate market value of the outstanding common shares held by non-affiliates of the Registrant, based on the closing price of the common shares reported on
the Nasdaq Global Select Market on the last business day of the most recently completed second fiscal quarter (June 28, 2024) was $4,410,636,958. For purposes of this
disclosure, common shares held by officers and directors of the Registrant and by persons who held more than 10% of the Registrant’s outstanding common shares have
been excluded because such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily conclusive.
As of February 17, 2025, there were 35,960,636 shares of the Registrant’s common shares, no par value, issued and outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant’s Definitive Proxy Statement for the Registrant’s Annual Meeting of Shareholders scheduled to be held on May 29, 2025 to be filed with
the Securities and Exchange Commission are incorporated by reference in answers to Part III of this Annual Report on Form 10-K.
Auditor Firm Id:
34
Auditor Name:
Deloitte & Touche LLP
Auditor Location:
Boston, Massachusetts, United States
Former Auditor Firm Id:
238
Auditor Name:
PricewaterhouseCoopers LLP
Auditor Location:
Boston, Massachusetts, United States

NOVANTA INC.
FORM 10-K
YEAR ENDED DECEMBER 31, 2024
TABLE OF CONTENTS
Item No.
Page
No.
PART I
Item 1.
Business .....................................................................................................................................................................
1
Item 1A.
Risk Factors ...............................................................................................................................................................
14
Item 1B.
Unresolved Staff Comments......................................................................................................................................
28
Item 1C.
Cybersecurity .............................................................................................................................................................
29
Item 2.
Properties ...................................................................................................................................................................
30
Item 3.
Legal Proceedings......................................................................................................................................................
30
Item 4.
Mine Safety Disclosures ............................................................................................................................................
30
PART II
Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
31
Item 6.
[Reserved]..................................................................................................................................................................
33
Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations....................................
33
Item 7A.
Quantitative and Qualitative Disclosures about Market Risk....................................................................................
47
Item 8.
Financial Statements and Supplementary Data..........................................................................................................
49
Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure....................................
97
Item 9A.
Controls and Procedures ............................................................................................................................................
97
Item 9B.
Other Information ......................................................................................................................................................
99
Item 9C.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.......................................................................
99
PART III
Item 10.
Directors, Executive Officers and Corporate Governance.........................................................................................
99
Item 11.
Executive Compensation ...........................................................................................................................................
100
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters..................
100
Item 13.
Certain Relationships and Related Transactions, and Director Independence ..........................................................
101
Item 14.
Principal Accountant Fees and Services....................................................................................................................
101
PART IV
Item 15.
Exhibits and Financial Statement Schedules .............................................................................................................
101
Item 16.
Form 10-K Summary .................................................................................................................................................
104
Signatures
105
As used in this report, the terms “we,” “us,” “our,” “Novanta,” “NOVT” and the “Company” mean Novanta Inc. and its
subsidiaries, unless the context indicates another meaning.
Unless otherwise noted, all dollar amounts in this report are expressed in United States dollars.
The following brand and trade names of the Company are used in this report: Cambridge Technology, Synrad, Laser Quantum,
ARGES, WOM, NDS, Med X Change, Reach Technology, JADAK, ThingMagic, Photo Research, Motion Solutions, General
Scanning, ATI Industrial Automation, Celera Motion, IMS, MicroE, Applimotion, Zettlex, Ingenia and Westwind.

1
PART I
Cautionary Note Regarding Forward Looking Statements
Except for historical information, the matters discussed in this Annual Report on Form 10-K are forward looking statements that
involve risks, uncertainties and assumptions that, if they never materialize or if they prove incorrect, could cause our consolidated
results to differ materially from those expressed or implied by such forward looking statements. The Company makes such forward
looking statements under the provision of the “Safe Harbor” section of the Private Securities Litigation Reform Act of 1995. Actual
future results may vary materially from those projected, anticipated, or indicated in any forward-looking statements as a result of
various important factors, including those set forth in Item 1A of this Annual Report on Form 10-K under the heading “Risk Factors.”
Readers should also carefully review the risk factors described in the other documents that we file with the Securities and Exchange
Commission (“SEC”) from time to time. In this Annual Report on Form 10-K, the words “anticipates,” “believes,” “expects,”
“intends,” “future,” “estimates,” “plans,” “could,” “would,” “should,” “potential,” “continues” and similar words or expressions (as
well as other words or expressions referencing future events, conditions or circumstances) identify forward looking statements.
Forward looking statements also include the assumptions underlying or relating to any of the forward-looking statements. The forward
looking statements contained in this Annual Report include, but are not limited to, statements related to: our belief that the Purchasing
Managers Index may provide an indication of the impact of general economic conditions on our sales into the advanced industrial end
market; our strategy; anticipated financial performance; expected liquidity and capitalization; drivers of revenue growth and our
growth expectations in various markets; management’s plans and objectives for future operations, expenditures and product
development, and investments in research and development; business prospects; potential of future product releases and expansion of
our product and service offerings; anticipated revenue performance; industry trends; market conditions; our competitive positions; the
loss of sales, or significant reduction in orders from, any major customers; our ability to contain or reduce costs; changes in economic
and political conditions, including increased tariffs, interest rates and inflation; changes in accounting principles; changes in actual or
assumed tax liabilities; expectations regarding tax exposures; anticipated reinvestment of future earnings and dividend policy;
anticipated expenditures in regard to the Company’s benefit plans; future acquisitions, integration and anticipated benefits from
acquisitions and dispositions; anticipated economic benefits and expected costs of restructuring programs; ability to repay our
indebtedness; our intentions regarding the use of cash; expectations regarding legal and regulatory environmental, social and
governance requirements and our compliance thereto; and other statements that are not historical facts. All forward looking statements
included in this document are based on information available to us on the date hereof. We will not undertake and specifically decline
any obligation to update any forward-looking statements, except as required under applicable law.
Item 1. Business
Overview
Novanta Inc. and its subsidiaries (collectively referred to as the “Company”, “Novanta”, “we”, “us”, “our”) is a leading global
supplier of core technology solutions that give medical and advanced industrial original equipment manufacturers (“OEMs”) a
competitive advantage. We combine deep proprietary technology expertise and competencies in precision medicine, precision
manufacturing, robotics and automation, and advanced surgery with a proven ability to solve complex technical challenges. This
enables us to engineer core components and sub-systems that deliver extreme precision and performance, tailored to our customers'
demanding applications.
The Company was founded and initially incorporated in Massachusetts in 1968 as General Scanning, Inc. (“General Scanning”).
In 1999, General Scanning merged with Lumonics Inc. The post-merger entity, GSI Lumonics Inc., continued under the laws of the
Province of New Brunswick, Canada. In 2005, the Company changed its name to GSI Group Inc. Through a series of strategic
divestitures and acquisitions, the Company transformed from one that was more focused on the semiconductor industry to one that
primarily develops and supplies components and sub-systems to OEMs in the medical and advanced industrial markets. The Company
changed its name to Novanta Inc. in May 2016.
Strategy
Our strategy is to drive sustainable, profitable growth through short-term and long-term initiatives, including:
•
disciplined focus on our diversified business model of providing components and sub-systems to long life-cycle OEM
customer platforms in attractive medical and advanced industrial niche markets;
•
improving our business mix to increase medical sales as a percentage of total revenue by:
-
introducing new products aimed at attractive medical applications, such as minimally invasive and robotic surgery,
ophthalmology, patient monitoring, drug delivery, clinical laboratory testing and life science equipment;

2
-
deepening our key account management relationships with and driving cross selling of our product offerings to
leading medical equipment manufacturers; and
-
pursuing complementary medical technology acquisitions;
•
increasing our penetration of high growth advanced industrial applications, such as laser materials processing, intelligent
end-of-arm robotic technology solutions, robotics, laser additive manufacturing, automation and metrology, by working
closely with OEM customers to launch application specific products that closely match the requirements of each
application;
•
broadening our portfolio of enabling proprietary technologies and capabilities through increased investment in new
product development, and investments in application development to further penetrate existing customers, while
expanding the applicability of our solutions to new markets;
•
broadening our product and service offerings through the acquisition of innovative and complementary technologies and
solutions in medical and advanced industrial technology applications;
•
expanding sales and marketing channels to reach new target customers;
•
improving our existing operations to expand profit margins and improve customer satisfaction by implementing lean
manufacturing principles, strategic sourcing across our major production sites, and optimizing and limiting the growth of
our fixed cost base; and
•
attracting, retaining, and developing world-class talented and motivated employees.
Recent Developments
On January 2, 2024, we completed the acquisition of Motion Solutions Parent Corp. (“Motion Solutions”), an Irvine, California
based provider of highly engineered integrated solutions, specializing in proprietary precision motion and advanced motion control
solutions, for a total purchase price of $192.0 million in cash, net of working capital adjustments. The acquisition was financed with
borrowings under our revolving credit facility. The addition of Motion Solutions enhances our product portfolio and further expands
our presence in attractive medical and precision medicine applications. The Motion Solutions acquisition is included in our Medical
Solutions reportable segment.
Business Environment
In recent years, the global economy has faced significant challenges, including inflation, supply chain disruptions, business
slowdowns, labor shortages, and market volatility. We address macroeconomic challenges by continuing to execute our strategy.
There have been improvements in the supply chain with better on-time deliveries, and recent efforts have successfully addressed talent
shortages. However, uncertainty remains about overall macroeconomic conditions due to geopolitical tensions and possible changes in
trade policies.
Economic tensions and changes in trade policies, such as higher tariffs, retaliatory measures, renegotiated free trade agreements,
changes in government funding, and the ongoing impact from prolonged inflationary pressures could impact the global market for our
products. In addition, we continue to monitor geopolitical conflict in Israel, Russia and Ukraine for any potential impact on our
businesses.

3
Acquisitions
We continuously evaluate our business mix and financial performance and have executed a series of acquisitions in line with our
strategy. The following table summarizes significant acquisitions since 2014:
Company
Year
of Acquisition
Total Purchase Price
(in millions)
Motion Solutions Parent Corp.
2024
$
192.0
MPH Medical Devices S.R.O.
2022
$
22.6
ATI Industrial Automation, Inc.
2021
$
223.9
Schneider Electric Motion USA, Inc.
2021
$
118.6
ARGES GmbH
2019
$
73.2
Zettlex Holdings Limited
2018
$
32.0
Laser Quantum Limited (24%)(1)
2018
$
45.1
Laser Quantum Limited (35%)
2017
$
31.1
W.O.M. World of Medicine GmbH
2017
$
134.9
JADAK LLC
2014
$
94.8
(1)
After the acquisition of the remaining (approximately 24%) noncontrolling interests of Laser Quantum
Limited (“Laser Quantum”) in September 2018, we owned 100% of the outstanding equity of Laser
Quantum.
Segments
During the fourth quarter of 2024, we updated our organizational structure and re-aligned our financial reporting structure under
two reportable segments: Automation Enabling Technologies and Medical Solutions. Prior to the reorganization, the Company's
historical reportable segments were: Precision Medicine and Manufacturing, Robotics and Automation, and Medical Solutions. Prior
period segment financial information has been recast to align with the new reportable segments.
Our reportable segments have been identified based on commonality and adjacency of end markets and customers amongst our
individual product lines. We evaluate the performance of, and allocate resources to, our segments based on revenue, gross profit and
operating profit. The following table shows the external revenues, gross profit margin and operating profit for each of the segments for
the years ended December 31, 2024, December 31 2023, and December 31, 2022 (dollars in millions):
2024
2023
2022
Revenue
Gross
Profit
Margin
Operating
Profit
Revenue
Gross
Profit
Margin
Operating
Profit
Revenue
Gross
Profit
Margin
Operating
Profit
Automation Enabling
Technologies
$
490.6
47.9% $
106.4
$
499.2
47.0% $
96.3
$
534.1
45.9% $
105.4
Medical Solutions
$
458.6
41.4% $
57.5
$
382.4
44.7% $
63.3
$
326.8
42.5% $
46.9
See Note 18 to Consolidated Financial Statements for additional financial information about our reportable segments.
Automation Enabling Technologies
The Automation Enabling Technologies segment designs, manufactures and markets laser beam delivery components, laser
beam delivery solutions, CO2 lasers, solid state lasers, ultrafast lasers, optical and inductive encoders, precision motors, integrated
stepper motors, servo drives, motion control solutions, intelligent robotic end-of-arm technology solutions, and air bearing spindles to
customers worldwide. The segment serves highly demanding applications for advanced industrial processes, advanced industrial and
medical robotics, other medical and life science automation applications, and medical laser procedures such as ophthalmology
applications. The vast majority of the segment’s product offerings are sold to OEM customers. The segment sells the majority of these
products directly, utilizing a highly technical sales force, and also sells some indirectly, through resellers and distributors.

4
The Automation Enabling Technologies segment is comprised of the following eight product lines:
Product Lines
Key End Markets
Brand Names
Description
Laser Beam Delivery
Components
Advanced Industrial
and Medical
Cambridge Technology Galvanometer and polygon optical scanning components that
provide precise control and delivery of laser beams through
motorized manipulation of mirrors and optical elements and
are integrated by OEM manufacturers with their controlling
hardware and software. Advanced industrial applications
include additive manufacturing, packaging converting, laser
marking, micromachining and metrology. Medical
applications include optical coherence tomography imaging,
microscopy, and laser-based vision correction.
Laser Beam Delivery
Solutions
Advanced Industrial
and Medical
Cambridge
Technology, Synrad,
Laser Quantum
Galvanometer and polygon optical scan heads that provide
precise control and delivery of laser beams through
motorized manipulation of mirrors and optical elements in
multi-axis scan heads, highly integrated scanning
subsystems, and controlling hardware and software.
Advanced industrial applications include additive
manufacturing, packaging converting, laser marking,
micromachining and metrology. Medical applications
include optical coherence tomography imaging, microscopy,
super-resolution imaging, and laser-based vision correction.
CO2 ,Solid State and
Ultrafast Lasers
Advanced Industrial
Synrad, Laser Quantum Continuous and pulsed CO2 lasers with power ranges from 5
to 400 watts. Diode-pumped solid-state lasers and ultrafast
lasers in the visible to near-infrared. Applications include
coding, marking, engraving, cutting and trimming of non-
metals, fine materials processing, additive manufacturing,
packaging converting, microscopy, micromachining, super-
resolution imaging and medical applications in dental and
dermatology.
Optical and Inductive
Encoders
Advanced Industrial
and Medical
Celera Motion, Zettlex
Optical and inductive encoders for precision motion control
and sensing in semiconductor and electronics manufacturing,
industrial and medical robotics, metrology, satellite
communications, autonomous vehicles, medical devices, and
laboratory and diagnostics equipment.
Precision Motors and
Integrated Stepper
Motors
Advanced Industrial
and Medical
Celera Motion,
Applimotion, IMS
Direct drive motor components, integrated motion control
solutions, and integrated motion sub-assemblies for
precision motion control in semiconductor and electronics
manufacturing, industrial and medical robotics, autonomous
vehicles, automation equipment, metrology, satellite
communications, agricultural robotics, medical devices, and
laboratory and diagnostics equipment.
Servo drives and
motion control
solutions
Advanced Industrial
and Medical
Celera Motion, Ingenia
Precision motion servo drives and control software used in
industrial robotics, medical robotics, autonomous vehicles,
satellite communications, and medical equipment.
Intelligent robotic end-
of-arm technology
solutions
Advanced Industrial
and Medical
ATI
Robotic accessories and end-of-arm tooling, including tool
changers, multi-axis force torque sensors, utility couplers,
material removal tools, collision sensors, and compliance
devices. Applications include advanced industrial and
medical robotics.
Air Bearing Spindles
Advanced Industrial
Westwind
High-speed and precision air bearings and air bearing
spindles. Applications include printed circuit board (“PCB”)
manufacturing, automotive coating, and semiconductor
manufacturing equipment.

5
Medical Solutions
The Medical Solutions segment designs, manufactures and markets a range of medical grade technologies, including medical
insufflators and endoscopic pumps and related disposables, laser beam delivery solutions, video processing and streaming and capture,
machine vision technologies, radio frequency identification (“RFID”) technologies, barcode identification technologies, thermal chart
recorders, light and color measurement technologies, touch panel displays, and advanced motion control solutions. The vast majority
of the segment’s product offerings are sold to OEM customers. The segment sells the majority of these products directly, utilizing a
highly technical sales force, and also sells some indirectly, through resellers and distributors.
The Medical Solutions segment is comprised of the following ten product lines:
Product Lines
Key End Markets
Brand Names
Description
Medical Insufflators,
Endoscopic Pumps and
related disposables
Medical
WOM
Insufflators, endoscopic pumps, and related disposables,
and other accessories for minimally invasive surgery.
Video Processing and
Streaming and Capture
Medical
NDS, Med X Change
Imaging management, including real-time distribution,
documentation, control, recording, and streaming for
surgical applications. High definition wireless
transmission of video in minimally invasive surgical
equipment.
Touch Panel Displays
Medical and
Advanced Industrial
Reach Technology
Embedded capacitive and resistive touch panel technology
that delivers high-performance solutions.
Machine Vision
Medical and
Advanced Industrial
JADAK
Camera-based machine vision products and solutions used
for image analysis within medical devices and advanced
industrial applications.
RFID Technologies
Medical and
Advanced Industrial
JADAK, ThingMagic
RFID technologies via High-Frequency (HF) and Ultra-
High Frequency (UHF) readers, writers and antennas for
applications such as surgical part tracking and counterfeit
detection.
Barcode Identification
Medical and
Advanced Industrial
JADAK
Embedded and handheld data collection products for
barcode identification.
Thermal Chart
Recorders
Medical
JADAK
Rugged thermal chart recorders for patient monitoring,
defibrillator equipment, blood gas analyzers, and pulse
oximeters.
Light and Color
Measurement
Advanced Industrial
Photo Research
Light and color measurement devices, including
spectroradiometers, photometers, and color
characterization software, used in research and
development and quality control testing.
Laser Beam Delivery
Solutions
Medical
Laser Quantum
Optical light engine products that integrate lasers into
light engines with full beam parameter control.
Applications include DNA sequencing.
Advanced Motion
Control Solutions
Medical and
Advanced Industrial
Motion Solutions
High-precision, customized subsystems and components,
specializing in proprietary precision motion and advanced
motion control solutions.
End Markets
We primarily operate in two end markets: the medical market and the advanced industrial market.
Medical Market
For the year ended December 31, 2024, the medical market accounted for approximately 55% of our revenue. Revenue from our
products sold to the medical market is generally affected by hospital, life science, and other healthcare provider capital spending,
growth rates of surgical procedures, changes in regulatory requirements and laws, demand levels for life science automation
technology, aggregation of purchasing by healthcare networks, changes in technology requirements, timing of OEM customers’
product development and new product launches, changes in customer or patient preferences, and general demographic trends.

6
Advanced Industrial Market
For the year ended December 31, 2024, the advanced industrial market accounted for approximately 45% of our revenue.
Revenue from our products sold to the advanced industrial market is affected by a number of factors, including changing technology
requirements and preferences of our customers, productivity or quality investments in a manufacturing environment, the financial
condition of our customers, changes in regulatory requirements and laws, and general economic conditions. We believe that the
Purchasing Managers’ Index on manufacturing activities specific to different regions around the world may provide an indication of
the impact of general economic conditions on our sales into the advanced industrial market.
Customers
We have a diverse group of customers that includes companies that are global leaders in the medical and advanced industrial
markets. Many of our customers participate in several market industries. During the years ended December 31, 2024 and
December 31, 2023, revenue from an OEM customer primarily in the medical end market accounted for approximately 10% of our
consolidated revenue. No customer accounted for 10% or more of our consolidated revenue during the year ended December 31, 2022.
Our customers include many OEMs who integrate our products into their systems for sale to end users. A typical OEM customer
will usually evaluate our products and our ability to provide application knowledge and expertise, post-sales application support,
supply chain management over long durations, manufacturing capabilities, product quality, global presence, and product
customization before deciding to incorporate our products into their products or systems. Customers generally choose suppliers based
on several factors, including product performance, reliability, application support, price, breadth of the supplier’s product offerings,
the financial condition of the supplier, and the geographical coverage offered by the supplier. Once certain products have been
designed into a given OEM customer’s product or system, there are generally significant barriers to subsequent supplier changes until
the end of the product or system life cycle, especially in the medical market.
Seasonality
While our revenues are not highly seasonal on a consolidated basis, sales from some of our individual product lines are
impacted in the first quarter by the lower seasonal spending patterns of our customers due to their annual capital budgeting cycles.
Backlog
As of December 31, 2024 and December 31, 2023, our consolidated backlog was approximately $445.5 million and $473.1
million, respectively. Most orders included in backlog represent open orders for products and services that, based on management’s
projections, have a reasonable probability of being delivered over the subsequent twelve months. The ability to reschedule orders
included in backlog varies depending on the customer and the order. Management believes that backlog typically is not a complete
indicator of future business prospects for any of our reportable segments due to the ability of customers to reschedule orders based on
their updated demand, changes in customer order lead times, and potential fluctuations in our supply chain and manufacturing
capacity. Therefore, backlog as of any date should not be relied upon as a complete indicator of our revenues for any future period.
Manufacturing
The majority of our manufacturing functions are performed internally, while a relatively small portion of our manufacturing
processes are outsourced to highly qualified third parties primarily for cost related reasons.
Products offered by our Automation Enabling Technologies segment are manufactured at facilities in Apex, North Carolina;
Bedford, Massachusetts; Marlborough, Connecticut; Mukilteo, Washington; Rocklin, California; Suzhou, China; and Taunton and
Manchester, United Kingdom. Products offered by our Medical Solutions segment are primarily manufactured at facilities in Irvine,
California; Mukilteo, Washington; Syracuse, New York; Ludwigsstadt, Germany; Manchester, United Kingdom, and Přelouč, Czech
Republic.
The majority of our products are produced in manufacturing operations certified under either ISO 9001 certification or ISO
13485 certification. All of our manufacturing operations have been certified under ISO 14001. More than 80% of our manufacturing
operations are certified under ISO 45001. Certain products, including medical insufflators and endoscopic pumps and related
disposables, are manufactured under current good manufacturing practices (“cGMPs”), which is a requirement for medical devices by
the United States Food and Drug Administration (the “FDA”).

7
Marketing, Sales and Distribution
We sell our products globally, primarily through our direct sales force. We also use distributors, including manufacturers’
representatives, to either augment our selling effort or serve a local market where we have no direct sales force. Our local sales,
applications, and service teams and our distributors work closely with our customers to ensure customer satisfaction with our products.
We have sales and service centers located in the United States, Europe and Asia.
To support our sales efforts, we maintain and continue to invest in a number of application centers around the world, where our
application experts work closely with customers on integrating and using our solutions in their equipment. We currently maintain
service and application centers in the United States, Europe and Asia.
Competition
We encounter strong competition in virtually all the markets, applications, and technologies we serve. Due to the wide and
diverse range of products and technologies, we face many different types of competitors and competition. Our competitors range from
large foreign and domestic organizations, which produce a comprehensive array of goods and services, to small organizations
producing a limited number of highly specialized products or services for specialized applications. The competitive climate of many
of the end market applications we serve is characterized by rapidly evolving technology and customer demands that require
continuous investments by us. Our competitive success requires advances in technology and product performance, improved price-for-
performance ratios, demonstrated increased throughput performance for our customers' products, lower total cost of ownership,
product quality, depth of our application knowledge and expertise, reputation amongst customers, customer service and technical
support, speed to market, geographical presence, and deep customer relationships.
We believe that our products offer many competitive advantages for our customers and the breadth of our technologies gives us
deep applications knowledge to better serve our customers’ needs.
Raw Materials, Components and Supplies
Each of our businesses uses a wide variety of raw materials, components and parts that are generally available from alternative
sources of supply and in adequate quantities from domestic and foreign sources. In some instances, we are able to design and/or re-
engineer the parts and components used in our products in case of supply chain shortages. For certain raw materials, components and
parts used in the production of some of our principal products, we have identified only a limited number of suppliers or, in some
instances, a single source of supply. We also rely on a limited number of suppliers to manufacture subassemblies for some of our
products.
For a further discussion of the importance and risks associated with our supply chain, see applicable risk factors under Item 1A
of this Annual Report on Form 10-K.
Patents and Intellectual Property
We rely upon a combination of copyrights, patents, trademarks, trade secret laws and restrictions on disclosure to protect our
intellectual property rights. We hold many registered and pending patents in the United States and other countries. In addition, we also
have trademarks registered in the United States and other countries. We will continue to actively pursue applications for new patents
and trademarks as we deem appropriate. However, there can be no assurance that any other patents will be issued to us or that such
patents, if and when issued, will provide any protection or benefit to us.
Although we believe that our patents and pending patent applications are important, we rely upon several additional factors that
are essential to our business success, including: market position, technological innovation, know-how, application knowledge and
product performance. However, there can be no assurance that we will be able to sustain these advantages. Considering the diversified
nature of our businesses, we do not believe that any individual patent is material to our business as a whole.
We also protect our proprietary rights by controlling access to our proprietary information and by maintaining confidentiality
agreements with our employees, consultants, and certain customers and suppliers. For a further discussion of the importance of risks
associated with our intellectual property rights, see applicable risk factors under Item 1A of this Annual Report on Form 10-K.
Human Capital
We believe that our employees are our most important asset. The Chief Human Resources Officer (“CHRO”) is responsible for
developing and executing our human capital strategy. This includes the acquisition, development, and retention of talent to deliver on
our strategy as well as the design of employee compensation and benefits, and inclusion and belonging initiatives. The Chief

8
Executive Officer (“CEO”) and the CHRO regularly update our board of directors on the operation and status of these human capital
activities, including, but not limited to, talent management, talent development, and succession planning. As of December 31, 2024,
we employed approximately 3,000 people, of which approximately 41% were in the United States, 50% in Europe, and 9% in Asia.
We win with our customers by delivering new technology innovations through our engineering teams of approximately 650
employees.
We believe that our employees have a meaningful role in helping us develop our culture. We utilize survey feedback
mechanisms to measure employee engagement and organizational health. This enables us to gain insight into our current status and
identify areas where we can improve. We have conducted six surveys of our entire employee population since 2018. We compare our
employee engagement and organizational health scores against benchmark populations within our survey vendor's database. Our
employee satisfaction score in the most recent survey in February 2024 was 95% of the benchmark score. This is an improvement of 5
percentage points compared to 2023. Following each survey cycle, we review the results with our teams across the Company and
develop specific action plans based on the feedback we receive. We implement our action plans with the goal of improving our overall
organizational health and employee engagement.
All employees are responsible for upholding the Novanta Code of Ethics and Business Conduct, which is important in
delivering on our strategy. We maintain a compliance hotline for the confidential reporting of any suspected policy violations or
unethical business conduct on the part of our businesses, employees, officers, directors, suppliers, or customers. We provide training
and education to our global workforce with respect to our Code of Ethics and Business Conduct, anti-bribery and anti-corruption
policies, data privacy regulations and workplace harassment on an annual basis.
The Novanta Way
The Novanta Way defines our performance culture and begins with building cohesive teams based on trust, commitment, and
accountability. Inclusion and belonging are an important part of our culture and are leader led and embedded into our ways of
working. Our aim is to foster a collaborative and inclusive workplace, reflected in our governance, leadership, and technical expertise
at all levels in the organization. Our policy is to not tolerate discrimination and harassment. We expect our teams to respect our core
values and conduct themselves ethically at all times in accordance with the Novanta Code of Ethics and Business Conduct.
As of December 31, 2024, our board of directors was comprised of 56% men and 44% women. Individuals from
underrepresented groups (defined as individuals who self-identify as Black, African American, Hispanic or Latino, Asian, Native
American, Alaskan Native, Native Hawaiian or Pacific Islander, or two or more races or ethnicities) continued at 11% representation
on our board of directors as of December 31, 2024.
During 2024, we included a series of strategic initiatives designed to foster an inclusive workforce with employees from all
backgrounds. We remain committed to enhancing our recruiting processes to engage applicants from all communities. In 2024, we
continued to find venues to connect with and identify qualified candidates from all backgrounds for our final interview slates.
We continue to foster an inclusive culture and promote lifelong learning by offering cultural awareness events and celebrations
and integrate them into our standard work.
Our Culture Council continues to support our Employee Resources Groups (“ERGs”) and Affinity Groups (“AG”) to increase
inclusion and sense of belonging among our employees leading to greater employee engagement. Our ERGs and Affinity Groups are
open to all employees.
Our Localization and Development Working Team collaborated with our business units on NovantaCARES, our voluntary
community outreach program, to support marginalized and underserved communities and to protect the environment. Additionally,
they supported our ERGs and Affinity Groups sponsoring our first annual ERG Festival held at 13 sites around the globe. The festival
created greater awareness and aided in membership recruitment to drive greater inclusion and belonging.
Compensation and Benefits
We strive to provide market competitive compensation, benefits and services that help meet the varied needs of our employees.
In addition to salaries and wages, these programs, which vary by country, can include annual bonuses, sales bonus plans, stock-based
compensation awards, defined contribution retirement savings plans with company matching contributions, healthcare and other
insurance benefits, flexible spending accounts, health savings accounts with company matching contributions, flexible time off, paid
time off, paid family leave, and tuition assistance. Certain U.S. facilities have a dedicated medical professional on site to provide basic
and preventative healthcare services to employees, provide general first aid, assess employee health risks, and promote overall
employee health. Additionally, all U.S. employees and their families have access to video and telephonic Telemedicine support seven

9
days a week, twenty-four hours a day. Our bonus and variable sales compensation plans allow for higher payouts when goals are
exceeded and lower or no payouts when goals are not achieved as planned.
Growth and Development
We invest significant resources to develop the talent needed to remain at the forefront of innovation and make Novanta an
employer of choice. In certain countries, we offer college tuition reimbursement for eligible employees for undergraduate and
graduate studies. Novanta University is a company-wide learning management program that includes both internal and external
training courses. We leverage the Novanta University processes and learning content to ensure all new employees have a common and
complete onboarding experience. Our people leaders, with the support of our human resources organization, are accountable for
ensuring that the onboarding process is complete and effective. In addition to Novanta University, we utilize our Novanta Growth
System, which provides processes, tools, and training with a focus on continuous improvement.
In 2024, we continued with Leadership Development programs for our front-line and mid-level leaders.
NovantaCARES - Voluntary Community Support
We provide every employee with one paid day-off per year to volunteer at non-profit organizations supporting social charities or
the environment. During 2024, approximately 33% of our employees participated in at least one NovantaCARES event, which was an
increase of 8 percentage points compared to 2023.
Safety and Wellbeing of Our Employees
We provide mandatory safety training in our facilities, which are designed to focus on empowering our employees with the
knowledge and tools they need to make safe choices and to mitigate risks. In further support of our employees, we offer a global
health and wellness resource center, “NovantaWELL”. The resource center is a central information hub for all employees, with
country-specific information on physical and mental health and wellness.
Government Regulation
Our current and contemplated activities and the products and processes that will result from such activities are subject to
substantial government rules and regulations, both in the United States and internationally. Such rules and regulations are subject to
change by the governing agencies, and we monitor those changes closely.
Environmental Regulations
Most of our production facilities are subject to various federal, state, local, and/or foreign environmental regulations related to
the use, storage, handling, and disposal of regulated materials, chemicals, and certain waste products.
We may face increasing complexity in our product designs and procurement operations due to the evolving nature of product
compliance standards. Those standards may impact the material composition of our products entering specific markets. Such
regulations went into effect in the European Union (“EU”) in 2006 (“The Restriction of Hazardous Substances Directive” (“RoHS”))
and in 2007 (“Registration, Evaluation, Authorisation and Restriction of Chemicals” (“REACH”)), and in China in 2007
(“Management Methods for Controlling Pollution Caused by Electronic Information Products Regulation” (“China-RoHS”)).
Our capital expenditures, earnings, and competitive position have not been, and are not expected to be, materially affected by
our compliance with federal, state, local and foreign environmental provisions that have been enacted or adopted to regulate the
discharge of materials into the environment.
Medical Device Regulations
Certain products manufactured by us are integrated into systems by our customers that are subject to regulation by the Federal
Food and Drug Administration (the “FDA”) and foreign regulatory authorities. We must comply with certain quality control
measurements in order for our products to be effectively used in our customers’ end products. Non-compliance with quality control
measurements could result in fines, penalties, and loss of business with our customers.
We are also subject to certain medical device regulations. Medical devices are subject to extensive and rigorous regulation by
the FDA and other federal, state, local and foreign authorities as well as notified bodies. In the United States, the Federal Food, Drug
and Cosmetic Act (the “FDCA”) and related regulations govern the conditions of safety, efficacy, clearance, approval, manufacturing,

10
quality system requirements, labeling, packaging, distribution, storage, recordkeeping, reporting, marketing, advertising, and
promotion of medical devices.
FDA Premarket Clearance and Approval Requirements
Unless an exemption applies, each medical device commercially distributed in the U.S. requires either FDA clearance of a
510(k) premarket notification or approval of a premarket approval application (“PMA”). Under the FDCA, medical devices are
classified into one of three classes - Class I, Class II or Class III - depending on the degree of risk associated with each medical device
and the extent of manufacturer and regulatory control needed to ensure its safety and effectiveness. Class I includes devices with the
lowest risk to the patient and are those for which safety and effectiveness can be assured by adherence to the FDA’s General Controls
for medical devices, which include compliance with the applicable portions of the Quality System Regulation (the “QSR”), facility
registration and product listing, reporting of adverse medical events, and truthful and non-misleading labeling, advertising, and
promotional materials. Class II devices are subject to the FDA’s General Controls and special controls as deemed necessary by the
FDA to ensure the safety and effectiveness of the device. These special controls can include performance standards, post-market
surveillance, patient registries and FDA guidance documents. While most Class I devices are exempt from the 510(k) premarket
notification requirement, manufacturers of most Class II devices are required to submit to the FDA a premarket notification under
Section 510(k) of the FDCA, requesting permission to commercially distribute the device. The FDA’s permission to commercially
distribute a device subject to a 510(k) premarket notification is generally known as 510(k) clearance. Devices deemed by the FDA to
pose the greatest risks, such as life-sustaining, life-supporting or some implantable devices, or devices that have a new intended use or
use advanced technology that is not substantially equivalent to that of a legally marketed device, are placed in Class III, requiring
approval of a PMA. Some pre-amendment devices are unclassified, but are subject to the FDA’s premarket notification and clearance
process in order to be commercially distributed. In many cases, our customers are responsible for compliance with the FDA’s
requirements applicable to medical devices. However, we also currently market certain Class II medical device products
independently that are subject to these requirements.
510(k) Marketing Clearance Pathway
To obtain 510(k) clearance, we must submit to the FDA a premarket notification submission demonstrating that the proposed
device is “substantially equivalent” to a predicate device already on the market. A predicate device is a legally marketed device that is
not subject to premarket approval, i.e., a device that was legally marketed prior to May 28, 1976 (pre-amendments device) and for
which a PMA is not required, a device that has been reclassified from Class III to Class II or Class I, or a device that was found
substantially equivalent through the 510(k) process. The FDA’s 510(k) clearance process usually takes from nine to twelve months,
but may take significantly longer. The FDA may require additional information, including clinical data, to make a determination
regarding substantial equivalence.
If the FDA agrees that the device is substantially equivalent to a predicate device currently on the market, it will grant 510(k)
clearance to commercially market the device. If the FDA determines that the device is “not substantially equivalent” to a previously
cleared device, the device is automatically designated as a Class III device. The device sponsor must then fulfill more rigorous PMA
requirements, or can request a risk-based classification determination for the device in accordance with the “de novo” process, which
is a route to market for novel medical devices that are low to moderate risk and are not substantially equivalent to a predicate device.
After a device receives 510(k) marketing clearance, any modification that could significantly affect its safety or effectiveness, or
that would constitute a major change or modification in its intended use, will require a new 510(k) marketing clearance or, depending
on the modification, a de novo classification or PMA approval. The FDA requires each manufacturer to determine whether the
proposed change requires submission of a 510(k) or a PMA in the first instance, but the FDA can review any such decision and
disagree with a manufacturer’s determination. Many minor modifications are accomplished by a letter-to-file in which the
manufacturer documents the change in an internal letter-to-file. The letter-to-file is prepared by the manufacturer in lieu of submitting
a new 510(k) to obtain clearance for every change. The FDA can always review these letters-to-file in an inspection. If the FDA
disagrees with a manufacturer’s determination, the FDA can require the manufacturer to cease marketing and/or request the recall of
the modified device until 510(k) marketing clearance or PMA approval is obtained. In these circumstances, we may also be subject to
significant regulatory fines or penalties.
Post-market Regulations
After a device is cleared or approved for marketing, numerous and pervasive regulatory requirements continue to apply. These
include:
•
establishment registration and device listing with the FDA;

11
•
QSR requirements, which require manufacturers, including third-party manufacturers, to follow stringent design, testing,
control, documentation and other quality assurance procedures during all aspects of the design and manufacturing process;
•
labeling and marketing regulations, which require that promotion is truthful, not misleading and fairly balanced, provide
adequate directions for use and that all claims are substantiated, and also prohibit the promotion of products for
unapproved or “off-label” uses and impose other restrictions on labeling;
•
FDA guidance on off-label dissemination of information and responding to unsolicited requests for information;
•
clearance or approval of product modifications to 510(k)-cleared devices that could significantly affect safety or
effectiveness or that would constitute a major change in intended use of the cleared devices;
•
medical device reporting regulations, which require that a manufacturer report to the FDA if a device that it markets may
have caused or contributed to a death or serious injury, or has malfunctioned and the device or a similar device that it
markets would be likely to cause or contribute to a death or serious injury, if the malfunction were to recur;
•
correction, removal and recall reporting regulations, which require that manufacturers report to the FDA field corrections
and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the
FDCA that may present a risk to health;
•
requirements governing Unique Device Identifiers on devices and also requiring the submission of certain information
about each device to the FDA’s Global Unique Device Identification Database;
•
the FDA’s recall authority, whereby the agency can order device manufacturers to recall from the market a product that is
in violation of governing laws and regulations; and
•
post-market surveillance activities and regulations, which apply when deemed by the FDA to be necessary to protect the
public health or to provide additional safety and effectiveness data on the device.
Our manufacturing processes are required to comply with the applicable portions of the QSR, which cover the methods and the
facilities and controls for the design, manufacture, testing, production, processes, controls, quality assurance, labeling, packaging,
distribution, installation and servicing of finished devices intended for human use. The QSR also requires, among other things,
maintenance of a device master file, device history file, and a complaints file. As a manufacturer, we are subject to periodic scheduled
or unscheduled inspections by the FDA. Our failure to maintain compliance with the QSR requirements could result in the shut-down
of, or restrictions on, our manufacturing operations and the recall or seizure of our products, which would have a material adverse
effect on our business. The discovery of previously unknown problems with any of our products, including unanticipated adverse
events or adverse events of increasing severity or frequency, whether resulting from the use of the device within the scope of its
clearance or off-label by a physician in the practice of medicine, could result in restrictions on the device, including the removal of the
product from the market or voluntary or mandatory device recalls.
The FDA has broad regulatory compliance and enforcement powers. If the FDA determines that we failed to comply with
applicable regulatory requirements, it can take a variety of compliance or enforcement actions, which may result in any of the
following sanctions:
•
warning letters, untitled letters, fines, injunctions, consent decrees and civil penalties;
•
recalls, withdrawals, or administrative detention or seizure of our products;
•
operating restrictions or partial suspension or total shutdown of production;
•
refusing or delaying requests for 510(k) marketing clearance or PMA approvals of new products or modified products;
•
withdrawing 510(k) clearances or PMA approvals that have already been granted;
•
refusal to grant export or import approvals for our products; or
•
criminal prosecution.
Regulation of Medical Devices in the European Union and U.K.
The EU has adopted specific directives and regulations regulating the design, manufacture, clinical investigation, conformity
assessment, labeling and adverse event reporting for medical devices.
Until May 25, 2021, medical devices were regulated by the Council Directive 93/42/EEC (“EU Medical Devices Directive”)
which has been repealed and replaced by Regulation (EU) No 2017/745 (“EU Medical Devices Regulation”). Our current certificates
have been granted and renewed under the EU Medical Devices Directive. In accordance with its recently extended transitional

12
provisions, both (i) devices lawfully placed on the market pursuant to the EU Medical Devices Directive prior to May 26, 2021 and
(ii) legacy devices lawfully placed on the EU market after May 26, 2021 in accordance with the EU Medical Devices Regulation
transitional provisions may generally continue to be made available on the market or put into service, provided that the requirements
of the transitional provisions are fulfilled. However, as of May 26, 2021, some of the EU Medical Devices Regulation requirements
apply in place of the corresponding requirements of the EU Medical Devices Directive with regard to registration of economic
operators and of devices, post-market surveillance, market surveillance and vigilance requirements. Pursuing marketing of medical
devices in the EU will notably require that our devices be certified under the new regime set forth in the EU Medical Devices
Regulation described below.
In the EU, there is currently no premarket government review of medical devices. However, all medical devices placed on the
EU market must meet general safety and performance requirements, including the requirement that a medical device must be designed
and manufactured in such a way that, during normal conditions of use, it is suitable for its intended purpose. Medical devices must be
safe and effective and must not compromise the clinical condition or safety of patients, or the safety and health of users and – where
applicable – other persons, provided that any risks which may be associated with their use constitute acceptable risks when weighed
against the benefits to the patient and are compatible with a high level of protection of health and safety.
Compliance with the general safety and performance requirements is a prerequisite for European conformity marking (“CE
mark”) without which medical devices cannot be marketed or sold in the EU. To demonstrate compliance with the general safety and
performance requirements, medical device manufacturers must undergo a conformity assessment procedure, which varies according to
the type of medical device and its risk classification. Except for low-risk medical devices (Class I non-sterile, non-measuring devices),
where the manufacturer can self-assess the conformity of its products with the general safety and performance requirements (except
for any parts which relate to sterility or metrology), a conformity assessment procedure requires the intervention of a notified body.
Notified bodies are independent organizations designated by EU member states to assess the conformity of devices before being
placed on the market. A notified body would typically audit and examine a product’s technical dossiers and the manufacturer’s quality
system (the notified body must presume that quality systems which implement the relevant harmonized standards, such as ISO
13485:2016 for Medical Devices Quality Management Systems, conform to these requirements). If satisfied that a relevant product
conforms to the relevant essential requirements, a notified body issues a certificate of conformity, which the manufacturer uses as a
basis for its own declaration of conformity. The manufacturer may then apply the CE mark to the device, which allows the device to
be placed on the market throughout the EU.
Throughout the term of the certificate of conformity, the manufacturer will be subject to periodic surveillance audits to verify
continued compliance with the applicable requirements. In particular, a new audit will be required by the notified body before it will
renew the relevant certificate(s).
The EU Medical Devices Regulation requires that before placing a device, other than a custom-made device, on the market,
manufacturers (as well as other economic operators such as authorized representatives and importers) must register by submitting
identification information to the electronic system (EUDAMED), unless they have already registered. The information to be submitted
by manufacturers (and authorized representatives) also includes the name, address and contact details of the person or persons
responsible for regulatory compliance. The new Regulation also requires that before placing a device, other than a custom-made
device, on the market, manufacturers must assign a unique identifier to the device and provide it along with other core data to the
unique device identifier (“UDI”) database. These new requirements aim at ensuring better identification and traceability of the
devices. Each device – and as applicable, each package – will have a UDI composed of two parts: a device identifier (“UDI-DI”),
specific to a device, and a production identifier (“UDI-PI”) to identify the unit producing the device. Manufacturers are also notably
responsible for entering the necessary data on EUDAMED, which includes the UDI database, and for keeping it up to date. Certain
obligations for registration in EUDAMED are expected to become applicable in Q1 2026 (as EUDAMED is not yet fully functional).
Until EUDAMED is fully functional, the corresponding provisions of the EU Medical Devices Directive continue to apply for the
purpose of meeting the obligations laid down in the provisions regarding exchange of information, including, and in particular,
information regarding registration of devices and economic operators.
All manufacturers placing medical devices into the market in the EU must comply with the EU medical device vigilance system
which has been reinforced by the EU Medical Devices Regulation. Under this system, serious incidents and Field Safety Corrective
Actions (“FSCAs”) required to be taken by manufacturers must be reported to the relevant authorities of the EU member states. These
reports will have to be submitted through EUDAMED – once functional – and aim to ensure that, in addition to reporting to the
relevant authorities of the EU member states, other actors such as the economic operators in the supply chain will also be informed.
Until EUDAMED is fully functional, the corresponding provisions of the EU Medical Devices Directive continue to apply.
Manufacturers are required to take FSCAs, which are defined as any corrective action for technical or medical reasons to prevent or
reduce a risk of a serious incident associated with the use of a medical device that is made available on the market. A serious incident
is any malfunction or deterioration in the characteristics or performance of a device on the market (e.g., inadequacy in the information
supplied by the manufacturer, undesirable side-effect), which, directly or indirectly, might lead to either the death or serious

13
deterioration of the health of a patient, user, or other persons, or to a serious public health threat. An FSCA may include the recall,
modification, exchange, destruction or retrofitting of the device. FSCAs must be communicated by the manufacturer or its legal
representative to its customers and/or to the end users of the device through Field Safety Notices. For similar serious incidents that
occur with the same device or device type and for which the root cause has been identified or a FSCA implemented or where the
incidents are common and well documented, manufacturers may provide periodic summary reports instead of individual serious
incident reports.
The advertising and promotion of medical devices is subject to some general principles set forth in EU legislation. According to
the EU Medical Devices Regulation, only devices that are CE marked may be marketed and advertised in the EU in accordance with
their intended purpose. Directive 2006/114/EC concerning misleading and comparative advertising and Directive 2005/29/EC on
unfair commercial practices, while not specific to the advertising of medical devices, also apply to the advertising thereof and contain
general rules, for example, requiring that advertisements are evidenced, balanced and not misleading. Specific requirements are
defined at a national level. EU member states’ laws related to the advertising and promotion of medical devices, which vary between
jurisdictions, may limit or restrict the advertising and promotion of products to the general public and may impose limitations on
promotional activities with healthcare professionals.
Many EU member states have adopted specific anti-gift statutes that further limit commercial practices for medical devices, in
particular vis-à-vis healthcare professionals and organizations. Additionally, there has been a recent trend of increased regulation of
payments and transfers of value provided to healthcare professionals or entities and many EU member states have adopted national
“Sunshine Acts” which impose reporting and transparency requirements (often on an annual basis), similar to the requirements in the
United States, on medical device manufacturers. Certain countries also mandate implementation of commercial compliance programs.
In the EU, regulatory authorities have the power to carry out announced and, if necessary, unannounced inspections of
companies, as well as suppliers and/or sub-contractors and, where necessary, the facilities of professional users. Failure to comply
with regulatory requirements (as applicable) could require time and resources to respond to the regulatory authorities’ observations
and to implement corrective and preventive actions, as appropriate. Regulatory authorities have broad compliance and enforcement
powers and, if such issues cannot be resolved to their satisfaction, can take a variety of actions, including untitled or warning letters,
fines, consent decrees, injunctions, or civil or criminal penalties.
The aforementioned EU rules are generally applicable in the European Economic Area (“EEA”), which consists of the 27 EU
member states plus Norway, Liechtenstein and Iceland.
United Kingdom
Since January 1, 2021, the Medicines and Healthcare Products Regulatory Agency (“MHRA”) has become the sovereign
regulatory authority responsible for the medical device market in Great Britain (i.e. England, Wales and Scotland). The regulations on
medical devices in Great Britain continue to be based largely on the two EU Directives (the EU Medical Devices Directive and
Directive 90/385/EEC, or “EU Active Implantable Medical Devices Directive”) which preceded the EU Medical Devices Regulation,
as implemented into national law by the Medical Devices Regulations 2002 (“SI 2002 No 618”, as amended) (“UK Medical Devices
Regulations”). However, under the terms of the Ireland/Northern Ireland Protocol, the EU Medical Devices Regulation applies to
Northern Ireland.
Furthermore, on December 16, 2024, the UK government published an amendment to the UK Medical Devices Regulations to
clarify and strengthen the post-market surveillance requirements for medical devices in Great Britain. This amendment will come into
force on June 16, 2025 and aims to facilitate greater traceability of incidents and trends enabling the MHRA to act swiftly when
needed to address safety issues and support the entire health system in better protecting patients. Additional legislation is expected to
be implemented in 2026 and aims to enable greater international collaboration and practices, with more patient-centered, proportionate
requirements for medical devices which are responsive to technological advances.
Under the UK Medical Devices Regulations, in order to be lawfully placed on the Great Britain market, Class I (non-sterile,
non-measuring or non-re-useable) medical devices need to be “UKCA” self-certified, and other medical devices need to be “UKCA”
certified by a UK approved body. However, certain medical devices in compliance with: (1) the EU Medical Devices Directive can
continue to be placed on the Great Britain market until the sooner of certificate expiration or June 30, 2028; or (2) the EU Medical
Devices Regulation can continue to be placed on the Great Britain market until the sooner of certificate expiration or June 30, 2030.
For further information regarding EU and UK healthcare laws and regulations that our operations are subject to, see “Item 1A.
Risk Factors—Risks Relating to Our Business— We are subject to extensive and dynamic medical device regulations, which may
impede or hinder the approval, certification or sale of our products and, in some cases, may ultimately result in an inability to obtain
approval or certification of certain products or may result in the recall or seizure of previously approved or certified products.”

14
Other Healthcare Laws and Regulations
In the United States and other jurisdictions where we operate our business, there are healthcare laws and regulations that
constrain our business operations, including our sales, marketing and promotional activities, and that limit the kinds of arrangements
we may have with customers, physicians, healthcare entities and others in a position to purchase or recommend our products or other
products or services we may develop and commercialize. Such laws include, without limitation, U.S. federal and state anti-kickback,
fraud and abuse, false claims, pricing reporting, and physician payment transparency laws and regulations regarding drug pricing and
payments or other transfers of value made to physicians and other licensed healthcare professionals as well as similar foreign laws in
the jurisdictions outside the United States. Violations of these laws may result in substantial civil penalties, including treble damages,
and criminal penalties, including imprisonment, fines, the curtailment or restructuring of our operations, and exclusion from
participation in governmental healthcare programs.
Data Privacy and Security Laws and Regulations
Numerous state, federal and foreign laws govern the collection, dissemination, use, access to, confidentiality, and security of
personal information, including health-related information. In the United States, numerous federal and state laws and regulations,
including data breach notification laws, health information privacy and security laws that govern the collection, use, disclosure, and
protection of health-related and other personal information, including HIPAA, could apply to our operations or the operations of our
customers. In addition, certain state and non-U.S. laws, such as the California Consumer Privacy Act, as amended by the California
Privacy Rights Act (collectively, the “CCPA”), and the General Data Protection Regulation (“GDPR”), govern the privacy and
security of personal information, including health-related information in certain circumstances, some of which are more stringent than
HIPAA and many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance
efforts. Failure to comply with these laws, where applicable, can result in the imposition of significant civil and/or criminal penalties
and private litigation. Privacy and security laws, regulations, and other obligations are constantly evolving, may conflict with each
other to make compliance efforts more challenging, and can result in investigations, proceedings, or actions that lead to significant
penalties and restrictions on data processing.
Other Information
We maintain a website with the address https://www.novanta.com. We are not including the information contained on our
website as part of, or incorporating it by reference into, this Annual Report on Form 10-K. We make available for download, free of
charge through our website (https://investors.novanta.com), our annual reports on Form 10-K, quarterly reports on Form 10-Q, current
reports on Form 8-K, proxy and information statements, and amendments to these reports as soon as reasonably practicable after we
electronically file these materials with, or otherwise furnish them to, the Securities and Exchange Commission (“SEC”). In addition,
our reports and other information are filed with securities commissions or other similar authorities in Canada and are available over
the Internet at https://www.sedar.com.
Item 1A. Risk Factors
The following risk factors could have a material adverse effect on our business, financial position, results of operations and cash
flows and could cause the market value of our common shares to fluctuate or decline. These risk factors may not include all of the
important factors that could affect our business or that could cause our future financial results to differ materially from historical or
expected results or cause the market price of our common shares to fluctuate or decline.
Risks Relating to Our Business
Our results of operations could be adversely affected by economic and political conditions and the effects of these conditions
on our customers’ businesses, capital expenditures and levels of business activities.
A large portion of our product sales are dependent on our customers’ need for increased capacity, productivity and cost saving
initiatives, improved product quality and performance, and new investments. Weaknesses in our end markets could negatively impact
our revenue and gross margin and consequently have a material adverse effect on our business, financial condition and results of
operations. A severe and/or prolonged overall economic downturn or a negative or uncertain political climate could lead to
weaknesses in our end markets and adversely affect our customers’ financial condition and the timing or levels of our customers’
capital expenditures or business activities. We have experienced significant cyclical end market fluctuations in the past. For example,
diminished growth expectations, economic and political uncertainty in regions across the globe and effects of the COVID-19
pandemic adversely impacted our customers’ financial condition and ability to maintain product order levels and reduced the demand
for our products in 2020, and other pandemics and public health crises could have similar consequences. Political conditions,
including new and changing laws or tariffs, regulations, government funding, executive orders and enforcement priorities, may impact
customer budgets and create uncertainty about how such laws and regulations will be interpreted and applied, which may impact

15
customer demand and adversely impact our business. For example, changes in the regulatory environment affecting life sciences and
pharmaceutical companies, and reduced budget allocations to government agencies that fund research and development activities,
such as the U.S. National Institutes of Health, or NIH, or targeted cancellations by the U.S. federal government of certain grants or
contracts, could adversely affect our business or results of operations. In addition, certain sub-segments of the advanced industrial
market that we serve, including the microelectronics and industrial capital equipment sector, are cyclical and have historically
experienced periods of oversupply, resulting in downturns in demand for capital equipment in which many of our products are used. It
is difficult to predict the timing, length and severity of these downturns and their impact on our business. Further, our order levels or
results of operations for a given period may not be indicative of order levels or results of operations for subsequent periods. For the
foreseeable future, our operations will continue to depend upon industries that are subject to market cycles which, in turn, could
adversely affect the market demand for our products.
We have also faced increases in inflationary conditions in materials and components. These inflationary conditions have caused
us to increase prices; however, such price increases may not be accepted by our customers or may not adequately offset the increases
in our costs, thereby negatively affecting our results of operations. Changes in global economic conditions, including inflationary
conditions, could also shift demand for products or services for which we do not have competitive advantages. This could negatively
affect the amount of business that we are able to obtain. In addition, if we are unable to successfully anticipate changes in economic
and political conditions, we may be unable to effectively plan for and respond to those changes, and our business could be negatively
affected.
Our business success depends upon our ability to respond to fluctuations in product demand, but doing so may require us to
incur costs despite limited visibility into future business declines.
During a period of increasing demand and rapid growth, we must be able to increase manufacturing capacity quickly. Our
inability to quickly increase production in response to a surge in demand has prompted customers to look for alternative sources of
supply and has left our customers without a supply, both of which have harmed our reputation and made it difficult for us to retain our
existing customers or to obtain new customers. If this inability to increase production continues or worsens, it could have a material
adverse effect on our business.
In periods of weaker demand, we have been, and may in the future be, required to reduce costs while maintaining the ability to
motivate and retain key employees at the same time. Additionally, to remain competitive, we must continually invest in research and
development, which may inhibit our ability to reduce costs in a down cycle. Long product lead-times also create a risk that we may
purchase inventories or manufacture products that we are unable to sell.
The success of our business depends on our ability to continuously innovate, to introduce new products in a timely manner,
and to manage transitions to new product innovations effectively.
Technology requirements in our markets are constantly changing. We must continually introduce new products that meet
evolving customer needs. Our ability to grow depends on the successful development, introduction and market acceptance of new or
enhanced products that address our customers’ requirements. Developing new technology is a complex and uncertain process
requiring us to accurately anticipate technological and market trends and meet those trends with the right products. Our research and
development efforts may not lead to the successful introduction of products within the time frame that our customers demand. Our
competitors may also introduce new or improved products, processes or technologies that make our current or proposed products
obsolete or less competitive. We may not manage the transition from older products effectively to minimize disruption in customer
ordering patterns, avoid excess inventory and ensure adequate supplies of new products. New products may have fewer features than
originally considered desirable, may have higher costs than initially estimated, may contain defects or perceived defects or have
reliability, quality or compatibility problems or perceived problems. There could be difficulties in sourcing components for new
products and delays in starting volume production. New products may also not be commercially successful as we cannot predict how
the market will react to new products introduced by us or to enhancements made to our existing products. Failure to develop and
introduce new products, failed market acceptance of new products or problems associated with new product transitions could impede
our revenue growth, lead to loss of market share, and negatively affect our results of operations and our competitiveness in the market.
Customer order timing and other factors may cause our operating results to fluctuate from period to period.
Changes in customer order timing and the existence of certain other factors may cause our operating results to fluctuate from
period to period. Such factors include: fluctuations in our customers’ businesses; decisions by customers to reduce their purchases of
our products; timing and recognition of revenues from customer orders; timing and market acceptance of new products or
enhancements introduced by us or our competitors; availability and pricing of parts from our suppliers and the manufacturing capacity
of our subcontractors; changes in the prices of our products or of our competitors’ products; and fluctuations in foreign currency
exchange rates.

16
We received in the past, and may receive in the future, several large orders in one quarter from a customer and then receive no
orders from that customer in the next quarter. As a result, the timing of revenue recognition from customer orders can cause
significant fluctuations in our operating results from quarter to quarter. In addition, our sales are reactive to changes in our customers’
businesses. For instance, a customer that placed a large order in one period could subsequently experience a downturn in business and,
as a result, could reduce the amount of products it purchases from us in future periods.
Delays in shipments near the end of a reporting period due to rescheduling by customers or unexpected production delays
experienced by us may cause revenue in the period to decline significantly and may have a material adverse effect on our operating
results for that period.
In addition, we or our competitors may raise or lower prices of products in response to market demands or competitive
pressures. If we lower the prices of our products, or if our competitors lower the prices of their products such that demand for our
products weakens, our revenue for one or more quarters may decline and our operating results would be adversely affected.
As a result of these factors, our results of operations for any quarter are not necessarily indicative of results to be expected in
future periods.
Our business may be adversely affected by cyberattacks or other incidents that cause significant disruption in, or breach the
security of, our information technology systems or those of our third-party providers.
We rely on information technology systems, software and services for internal and external operations that are critical to our
business (collectively “IT Systems”). We operate some of these IT Systems ourselves and also rely on IT Systems provided by third
parties to operate our business activities, including interactions with our employees and our customers and suppliers. These activities
include, but are not limited to, ordering and managing materials from suppliers, converting materials to finished products, shipping
products to customers, processing transactions, summarizing and reporting results of operations, complying with regulatory, legal and
tax requirements, and other processes necessary to manage our business. We do not control our third-party service providers and we
do not maintain redundant systems for some of such services, increasing our vulnerability to problems with such services. In addition,
in the ordinary course of business, we and our third-party service providers collect, process and maintain data about customers,
employees, business partners and others, including personal information as well as proprietary business information (collectively
“Confidential Information”).
Like other global companies, there are constant cyber related threats and risks from internal and external perpetrators of random
or targeted malicious cyberattacks, computer viruses, malware, worms, bot attacks or other destructive or disruptive software (for
example, ransomware) and attempts to misappropriate customer information and cause system failures and disruptions, malfeasance
by insiders, human or technological error, as well as power outages, natural disasters, hardware and software bugs, misconfigurations
or failures, and other unforeseen events. We have experienced cyberattacks and other security incidents in the past and expect to
experience such attacks and incidents in the future. We expect the frequency and magnitude of cyberattacks to continue to accelerate
as attackers are becoming increasingly more sophisticated, for example, by using techniques designed to circumvent controls, avoid
detection, and obfuscate forensic evidence, such that we may be unable to timely or effectively detect, identify, investigate or
remediate attacks in the future. In addition, remote and hybrid working arrangements have increased the risk of cybersecurity incidents
given the prevalence of phishing and vulnerabilities inherent in non-corporate and home computing environments.
If we were to experience a significant period of disruption in our IT Systems that involve our interactions with customers or
suppliers, it could result in the loss of revenue and customers as well as significant response and mitigation costs, which would
adversely affect our business. In addition, security breaches of our IT Systems could result in the misappropriation or unauthorized
disclosure of Confidential Information belonging to us or to our employees, customers, suppliers or other business partners, which
could result in significant financial or reputational damage to us, as well as litigation, regulatory enforcement actions, or other
liabilities that could lead to substantial damages, fines, penalties and legal costs. We also expend substantial amounts to protect our IT
Systems, and if we were to experience a significant breach in security, we may need to materially increase such expenditures, which
could adversely affect our results of operations. Further, there can be no assurance that our cybersecurity risk management program
and processes, including our policies, controls or procedures, will be fully implemented, complied with or effective in protecting our
systems and information.
Our insurance policies may not cover all types of cybersecurity risks and liabilities, and even if coverages exist, they may not be
sufficient to cover all costs or losses that we may incur.

17
Our reliance on international operations subjects us to risks not typically faced by companies operating exclusively in the
U.S.
During the year ended December 31, 2024, approximately 49% of our revenues were from customers outside of the U.S. The
scope of our international operations subjects us to risks that could materially impact our results of operations, including:
•
foreign exchange rate fluctuations;
•
increases in shipping costs;
•
longer customer payment cycles;
•
greater difficulty in collecting accounts receivable;
•
use of incompatible systems and equipment;
•
problems with staffing and managing foreign operations in diverse cultures;
•
trade tariffs, trade barriers and export/import controls;
•
transportation delays and interruptions;
•
increased vulnerability to the theft of, and reduced protection for, intellectual property rights;
•
government currency control and restrictions, delays, penalties or required withholdings on repatriation of earnings;
•
failure to comply with foreign laws and regulations, including those that potentially conflict with other jurisdictions;
•
the impact of recessionary foreign economies;
•
political unrest and wars, such as the current situation with Ukraine and Russia and Israel and surrounding areas, which
could delay or disrupt our business, and if such geopolitical unrest escalates or spills over to or otherwise impacts
additional regions, it could heighten many of the other risk factors included in this Item 1A; and
•
natural disasters, health epidemics and acts of terrorism.
We also are subject to risks that our operations outside the U.S. could be conducted by our employees, contractors, service
providers, representatives or agents in ways that violate the Foreign Corrupt Practices Act or other similar anti-bribery laws. Any such
violations could have a negative impact on our business and could result in government investigations and/or injunctive, monetary or
other penalties. Moreover, our anti-bribery policy and procedures may be violated by third-party sales representatives or other agents
that help sell our products or provide other services. Such representatives or agents are not our employees and it may be more difficult
to oversee their conduct, which may increase the risk of violations of anti-bribery laws.
Increased component outsourcing to manufacturers located in different countries than our manufacturing facilities leads to
additional risks that could negatively impact our business.
In some cases, we have outsourced the manufacturing of key components and subassemblies to suppliers based in locations
outside of the country in which our manufacturing facility resides. We make the decision to outsource these products when we identify
suppliers with stronger competencies, resources, capabilities, and lower cost structures than we believe we can develop on our own.
However, the outsourcing of these products to such third parties could increase our exposure to geopolitical, economic, trade, natural
disasters and other climate related risks, which could substantially impact our ability to obtain critical parts needed in the timely
manufacture of our products or could substantially increase the costs of these parts. Additionally, this practice increases our
vulnerability to the theft of, and reduced protection for, our intellectual property.
Increases in tariffs, trade restrictions or taxes on our products could have an adverse impact on our results of operations.
Our sales channels and supply chain in the international marketplace make us subject to tariffs, trade restrictions and other taxes
when the raw materials or components we purchase, and the products we sell, cross international borders. Trade tensions between
countries, escalated in recent years. For example, U.S. tariff impositions against Chinese exports in recent years were followed by
retaliatory Chinese tariffs on U.S. exports to China. Certain of the raw materials and components we purchase from China are or were
subject to these tariffs, which have increased our manufacturing costs and have made our products less competitive than those of our
competitors whose inputs are not subject to these tariffs. Such tariffs may increase in the future. Certain of our finished products
manufactured in the U.S. have been and may in the future be subject to retaliatory tariffs in China, which may increase our costs and
make our products less competitive than those of our competitors whose products are not subject to such retaliatory tariffs. If
heightened tariffs or trade restrictions were to be imposed in the future, we may not be able to mitigate their impacts, and our business,
results of operations and financial position could be materially adversely affected. Products we sell into certain other foreign markets

18
could also become subject to retaliatory tariffs, making our products uncompetitive to similar products not subjected to such import
tariffs. Further changes in trade policies, tariffs, taxes, export restrictions or other trade barriers, or restrictions on raw materials or
components may limit our ability to produce products, increase our manufacturing costs, decrease our profit margins, reduce the
competitiveness of our products, or inhibit our ability to sell products or purchase raw materials or components, which would have a
material adverse effect on our business, results of operations and financial condition.
Our operating results depend in part on our ability to contain or reduce costs. There is substantial price competition in our
industry and upward pressure on material and labor costs. Our success and profitability will depend on our ability to maintain a
competitive cost and price structure.
Our efforts to maintain and improve profitability depend in part on our ability to maintain or reduce the costs of materials,
components, supplies and labor. While the failure of any single cost containment effort by itself would most likely not significantly
impact our results, we cannot give any assurance that we will be successful in controlling material and labor costs to maintain a
competitive cost structure. There is substantial price competition in our industry, and our success and profitability will depend on our
ability to maintain a competitive cost and price structure. We may have to reduce prices in the future to remain competitive. Also, our
future profitability will depend in part upon our ability to continue to improve our manufacturing efficiencies and maintain a cost
structure that will enable us to offer competitive prices in the face of upward pressure on material and labor costs. Our inability to
maintain a competitive cost structure could have a material adverse effect on our business, financial condition and results of
operations.
Others may violate our intellectual property rights and cause us to incur significant costs to protect our rights.
Our future success depends in part upon the protection of our intellectual property rights, including patents, trade secrets, know-
how and continual technological innovation. We do not have personnel fully dedicated to the oversight, organization and management
of our intellectual property. There can be no assurance that the steps we take to protect our intellectual property rights will be adequate
to prevent misappropriation or disclosure. It is possible that, despite our efforts, other parties may use, obtain or try to copy our
technology and products. There can be no assurance that other companies are not investigating or developing other technologies
similar to ours, that any patents will be issued from applications filed by us, or that the claims allowed, even if patents are issued, will
be sufficient to deter or prohibit others from marketing similar products. In addition, our patents may be challenged, invalidated or
circumvented in a legal or administrative proceeding. Policing unauthorized use of our intellectual property rights is difficult and time
consuming and may involve initiating claims or litigation against third parties for infringement of our proprietary rights, which could
be costly and divert management resources.
Our efforts to protect our intellectual property rights against infringement may not be effective in some foreign countries where
we operate or sell our products. If we fail to adequately protect our intellectual property in these countries, we may lose significant
business to our competitors.
Our operating results would suffer if we are unable to successfully defend against infringement claims by third parties.
We have received in the past, and could receive in the future, notices from third parties alleging that our products infringe patent
or other proprietary rights. These allegations could result in significant costs and diversion of the attention of management. Adverse
consequences may also apply if we fail to avoid or successfully defend litigation for infringement or misappropriation of proprietary
rights of third parties. We could be required to pay substantial amounts for damages or be enjoined from using the technology deemed
to be infringing, or from using, making or selling products deemed to be infringing, any of which could adversely affect our operating
results. If we have supplied infringing products to third parties, we may be obligated to indemnify these third parties for any damages
that they may be required to pay to the patent holder and for any losses that they may sustain as a result of the infringement.
We operate in highly competitive industries and, if we lose competitive advantages, our business would suffer adverse
consequences.
Some of our competition comes from established competitors that have greater financial, engineering, manufacturing and
marketing resources than we do. We expect that our competitors will continue to improve the design and performance of their existing
products and introduce new products. It is possible that we may not successfully differentiate our current and proposed products from
the products of our competitors, or that the marketplace will not consider our products to be superior to competing products. To
remain competitive, we will be required to invest heavily in research and development, marketing and customer service and support.
However, we may not be able to make the necessary technological advances to maintain our competitive position and our products
may not receive market acceptance. These factors would cause us not to be able to compete successfully in the future. Increased
competition may also result in price reductions, reduced profit margins, loss of market share and an inability to generate cash flows
that are sufficient to maintain or expand our new product development programs.

19
Our results of operations will be adversely affected if we fail to identify suitable acquisition candidates, complete
acquisitions, successfully integrate recent and future acquisitions or grow the acquired businesses as planned.
As part of our business strategy, we expect to broaden our product and service offerings by acquiring businesses, technologies,
assets and product lines that, we believe, complement or expand our existing businesses. We may have difficulty finding acquisition
opportunities, or if we do identify these opportunities, we may not be able to complete the transactions for various reasons, including a
failure to secure financing on acceptable terms. In recent years, we have made a number of acquisitions, including the acquisitions of
Motion Solutions Parent Corp., MPH Medical Devices S.R.O., ATI Industrial Automation, Inc., and Schneider Electric Motion USA,
Inc., and we expect to continue to make acquisitions in the future. We may fail to successfully integrate acquired businesses, products,
technologies or personnel into our businesses and, as a result, may fail to realize the synergies, cost savings and other benefits
expected from the acquisitions. If we are not able to successfully achieve these objectives, the anticipated benefits of such acquisitions
may not be realized fully or at all, and our results of operations could be adversely affected. If we consummate multiple acquisitions in
a relatively short amount of time, these risks will be heightened due to limited resources available to integrate these new businesses.
Our acquisition activities may divert management’s attention from our regular operations. Managing a larger and more geographically
dispersed operation and product portfolio could also pose challenges for our management team.
Further, our ability to maintain and increase the profitability of acquired businesses will depend on our ability to manage and
control operating expenses and to generate and sustain increased levels of revenue. Our expectations to achieve more consistent and
predictable levels of revenue and to increase profitability as a result of any acquisition may not be realized. Such revenues and
profitability may even decline as we integrate newly acquired operations into our existing businesses. We may fail to identify inherent
weaknesses in acquired businesses or misinterpret market and technology trends and growth potentials during our acquisition due
diligence process. If revenues of acquired businesses decline or grow more slowly than we anticipate, or if their operating expenses
are higher than we expect, we may not be able to sustain or increase their profitability, in which case we may not be able to realize the
expected return on our investments, our financial condition will suffer, and our stock price could decline. In addition, through our
acquisitions, we may assume liabilities, losses or costs for which we are not indemnified or insured or for which our indemnity or
insurance is inadequate. Any such liabilities may have a material adverse effect on our financial position or results of operations.
If we do not attract and retain our key personnel, our ability to execute our business strategy will be limited.
Our success depends, to a significant extent, upon the continued service of our executive officers, key management and
technical personnel, particularly our experienced engineers, and upon our ability to continue to attract, retain, and motivate qualified
personnel. The competition for skilled employees is intense. We have incurred increased expenses in connection with the retention of
existing key personnel and hiring of new employees, and we expect these increased costs to continue. Additional losses of our key
personnel could have a material adverse effect on our operating results. In addition, there could be a material adverse effect on us if
the turnover rates for engineers and other key personnel increase significantly or if we are unable to continue to attract qualified
personnel. The costs to retain or hire employees could also increase more than we expect.
Our success also depends on our ability to execute leadership succession plans. The inability to successfully transition key
management roles could have a material adverse effect on our operating results.
We have undertaken restructuring and realignment activities in the past, and we will continue to assess our operating and
cost structure in the future. These actions may not improve our financial position, and may ultimately prove detrimental to our
operations and sales.
We have undertaken restructuring and realignment activities in the past, and we will continue to assess our operating and cost
structure in the future. Our ability to reduce operating expenses and improve gross margin is dependent upon the nature of the actions
we take and our subsequent ability to implement those actions and realize the expected cost savings and gross margin improvements.
We are taking, and may need to take in the future, additional restructuring actions, such as eliminating or consolidating certain of our
facilities or operations, reducing our headcount, or eliminating certain positions. Failure to successfully implement such restructuring
activities could adversely affect our ability to meet customer demand for our products and could increase the cost of production versus
our projections, both of which could adversely impact our operating results. Further, expenses and cost inefficiencies associated with
our restructuring activities, including severance costs and the loss of trained employees with knowledge of our business and
operations, could exceed our expectations and negatively impact our financial results.
Product defects or problems with integrating our products with other vendors’ products used by our customers may seriously
harm our business and reputation.
We produce complex products that can contain latent defects or performance problems. This could happen to both existing and
new products. Such defects or performance problems could result in litigation against us and be detrimental to our business and
reputation.

20
In addition, customers frequently integrate our products with other vendors’ products. When problems occur in a combined
environment, it may be difficult to identify the source of the problem. These problems may cause us to incur significant warranty and
repair costs, divert the attention of our engineering personnel from our product development efforts, and cause significant customer
relationship issues, any of which could adversely affect our results of operations and financial condition.
Disruptions in the supply of certain key components and other goods from our suppliers, including limited or single source
suppliers, have adversely affected the results of our business operations, and could damage our relationships with customers.
The production of our products requires a wide variety of raw materials, key components and other goods that are generally
available from alternate sources of supply. However, certain critical raw materials, key components and other goods required for the
production of some of our principal products are available from limited or a single source of supply. Certain single source suppliers of
key components for us could decide to stop producing some of these components. If we fail to find alternative sources, redesign our
products or otherwise manage this transition effectively, our business would be adversely impacted. If we experience delays in
receiving materials from certain of our key limited or single source suppliers, our relationship with customers may be harmed if such
delays cause us to miss our scheduled shipment deadlines for customers and our business could be adversely affected. If suppliers or
subcontractors experience difficulties or fail to meet our manufacturing requirements, our business would be harmed until we are able
to secure alternative sources, if any, on commercially reasonable terms. A prolonged inability to obtain or increase in the prices of
certain raw materials, key components or other goods is possible and could have a significant adverse effect on our business
operations, damage our relationships with customers, or even lead to permanent loss of customer orders.
In addition, certain of our businesses buy components, including limited or sole source items, from competitors of our other
businesses. This dynamic may adversely impact our relationship with these suppliers. For example, these suppliers could increase the
price of those components or reduce their supply of those components to us, which could have a significant adverse effect on our
business operations or lead to permanent loss of customer orders.
If we fail to accurately forecast component and raw material requirements for our products, we could incur additional costs
and experience significant delays in shipments, which could have an adverse effect on the results of our business operations, and
could damage our relationships with customers.
We use rolling forecasts based on anticipated product orders to determine our production requirements. It is important that we
accurately predict both the demand for our products and the lead times required to obtain the necessary components and raw materials
to manufacture our products. Lead times for our components and raw materials vary significantly and depend on multiple factors,
including the specific supplier requirements, the size of the order, contract terms and current market demand. For substantial increases
in our sales levels of certain products, some of our suppliers may need significant lead time. If we overestimate our component and
raw material requirements, we may have excess inventory, which would increase our costs. If we underestimate our component and
raw material requirements, we may encounter material shortages, which could interrupt production and delay delivery of our products
to customers. Any of these occurrences could adversely affect our results of operations and damage our relationships with customers.
Production difficulties and product delivery delays or disruptions could have a material adverse effect on our business.
We assemble our products at our facilities in the U.S., the U.K., Germany and China. Each of our products is typically
manufactured in a single manufacturing location. If our production activities at any of our manufacturing facilities were disrupted,
including by mandatory power consumption reductions, natural disasters or other extreme weather events, health epidemics, acts of
terrorism or otherwise, our operations would be negatively impacted until we could establish alternative production and service
operations. Significant production difficulties could also be the result of: mistakes made while transferring manufacturing processes
between locations; changing process technologies; ramping production; installing new equipment at our manufacturing facilities;
implementing new information technology systems; shortage of key components; and loss of electricity or employees’ access to the
manufacturing facilities due to man-made and natural disasters.
From time to time, we make decisions to consolidate or move certain of our manufacturing facilities, or otherwise move our
production of certain products to another facility. Moving complicated manufacturing facilities involves various risks, including the
inability to commence production within the cost and timeframe estimated, damage to equipment, inability to produce a high-quality
product, shipping and customs delays, travel and technology restrictions, tax issues, distraction to management and employees, and the
inability to hire and retain a sufficient number of qualified personnel. Failure to successfully move manufacturing facilities due to
these and other unforeseen risks could adversely affect our ability to meet customer demand, harm our relationships with customers,
and adversely impact our results of operations and financial condition.
In addition, we may experience product delivery delays in the future. We ship our products through national trucking firms,
overnight carrier services and local delivery practices. If one or more of the key logistics service providers experience significant
disruption in services or institutes a significant price increase, the delivery of our products could be disrupted or delayed. In addition, a

21
pandemic or other public health crisis may cause shipping and delivery delays. Such events could cause us to incur increased shipping
costs that could not be passed on to our customers or impact our ability to deliver orders, negatively impacting our profitability and
our relationships with customers.
We are subject to extensive and dynamic medical device regulations, which may impede or hinder the approval, certification
or sale of our products and, in some cases, may ultimately result in an inability to obtain approval or certification of certain
products or may result in the recall or seizure of previously approved or certified products.
Some of our products and the related sales and marketing development activities and manufacturing processes are subject to
extensive and rigorous regulation by the FDA pursuant to the Federal Food, Drug, and Cosmetic Act (the “FDCA”), by comparable
agencies in foreign countries, and by other regulatory agencies and governing bodies. Under the FDCA, medical devices must receive
FDA clearance or approval or an exemption from such clearance or approval before they can be commercially marketed in the U.S. In
the EU, medical devices must comply with the EU Medical Devices Regulation, which repeals and replaces the EU Medical Devices
Directive. All medical devices placed on the market in the EU must meet the general safety and performance requirements laid down
in Annex I to the EU Medical Devices Regulation, including the requirement that a medical device must be designed and
manufactured in such a way that, during normal conditions of use, it is suitable for its intended purpose. Medical devices must be safe
and effective and must not compromise the clinical condition or safety of patients, or the safety and health of users and – where
applicable – other persons, provided that any risks which may be associated with their use constitute acceptable risks when weighed
against the benefits to the patient and are compatible with a high level of protection of health and safety, taking into account the
generally acknowledged state of the art. To demonstrate compliance with the general safety and performance requirements, medical
devices must undergo a conformity assessment procedure, which varies according to the type of medical device and its risk
classification. Except for low risk medical devices (Class I), where the manufacturer can self-assess the conformity of its products
with the general safety and performance requirements (except for any parts which relate to sterility, metrology or reuse aspects), a
conformity assessment procedure requires the intervention of a notified body. The notified body would typically audit and examine
the technical file and the quality system for the manufacture, design and final inspection of our devices. If satisfied that the relevant
product conforms to the relevant general safety and performance requirements, the notified body issues a certificate of conformity,
which the manufacturer uses as a basis for its own declaration of conformity. The manufacturer may then apply the European
Conformity (“CE”) mark to the device, which allows the device to be placed on the market throughout the EU. If we fail to comply
with applicable laws and regulations, we would be unable to affix the CE mark to our products, which would prevent us from selling
them within the EU. The aforementioned EU rules are generally applicable in the EEA. Non-compliance with the above requirements
would also prevent us from selling our products in these countries.
Compliance with these requirements is a prerequisite to be able to affix the CE mark to medical devices, without which they
cannot be sold or marketed in the EU. The process of obtaining marketing approval, certification or clearance from the FDA,
comparable agencies, or notified bodies in foreign countries for new products, or with respect to enhancements or modifications to
existing products, could take a significant period of time; require substantial resources; involve rigorous pre-clinical and clinical
testing, as well as increased post-market surveillance; require changes to products; and result in limitations on the indicated uses of
products.
In addition, exported devices are subject to the regulatory requirements of each country to which the device is exported. Some
countries do not have medical device regulations, but in most foreign countries, medical devices are regulated. Most countries outside
of the U.S. require that product approvals be renewed or recertified on a regular basis, generally every four to five years. The renewal
or recertification process requires that we evaluate any device changes and any new regulations or standards relevant to the device and
conduct appropriate testing to document continued compliance. Where renewal or recertification applications are required, they may
need to be renewed and/or approved or certified in order for us to continue selling our products in those countries. There can be no
assurance that we will receive the required approvals or certification for new products or modifications to existing products on a
timely basis or that any approval or certification will not be subsequently withdrawn or conditioned upon extensive post-market study
requirements.
In the EU, notified bodies must be officially designated to certify products and services in accordance with the EU Medical
Devices Regulation. Their designation process is significantly stricter under the new regulation. Despite a recent increase in
designations, the current number of notified bodies designated under the new regulation remains significantly lower than the number
of notified bodies designated under the previous regime. The current designated notified bodies are therefore facing a backlog of
requests, and as a consequence, review times have lengthened. This situation may impact the way we are conducting our business in
the EU and the EEA and the ability of our notified body to timely review and process our regulatory submissions and perform its
audits.
The FDA, other worldwide regulatory agencies, and notified bodies actively monitor compliance with local laws and regulations
through review, inspection and audit of design and manufacturing practices, recordkeeping, reporting of adverse events, labeling and
promotional practices. The FDA and other regulatory agencies worldwide can ban certain medical devices; detain or seize adulterated

22
or misbranded medical devices; order recall, repair, replacement or refund of these devices; and require notification of healthcare
professionals and others with regard to medical devices that present unreasonable risks of substantial harm to the public health. The
FDA and other worldwide regulatory agencies can take action against a company that promotes “off-label” uses. The FDA may also
enjoin and restrain a company for certain violations of the FDCA and regulations pertaining to medical devices, or initiate action for
criminal prosecution of such violations. Similar requirements apply in foreign jurisdictions. Any adverse regulatory action, depending
on its magnitude, may restrict a company from effectively marketing and selling its products, may limit a company's ability to obtain
future premarket clearances, approvals or certifications, and could result in a substantial modification to the company's business
practices and operations. International sales of medical devices manufactured in the U.S. that are not approved by the FDA for use in
the U.S., or that are banned or deviate from lawful performance standards, are subject to FDA export requirements.
Regulations regarding the development, manufacture and sale of medical devices are evolving and subject to future changes. For
instance, the landscape concerning medical devices in the EU recently evolved. On May 26, 2021, the EU Medical Devices
Regulation became applicable, and repealed and replaced the EU Medical Devices Directive and the EU Active Implantable Medical
Devices Directive. Unlike directives, which must be implemented into the national laws of the EU member states, regulations are
directly applicable (i.e., without the need for adoption of EU member state laws implementing them) in all EU member states. The EU
Medical Devices Regulation is intended to establish a uniform regulatory framework across the EU for medical devices. These
modifications may have an effect on the way we intend to develop our business in the EU and EEA.
There are currently different regulations in place in Great Britain as compared to both Northern Ireland and the EU. Ongoing
compliance with both sets of regulatory requirements may result in increased costs for our business.
Furthermore, on December 16, 2024, the UK government published an amendment to the UK Medical Devices Regulations to
clarify and strengthen the post-market surveillance requirements for medical devices in Great Britain. This amendment will come into
force on June 16, 2025. In addition, the MHRA launched a consultation from November 14, 2024 to January 5, 2025 on proposals to
update the pre-market requirements for medical devices in Great Britain. The MHRA has stated that it will incorporate feedback to
this consultation into new UK legislation on pre-market requirements for medical devices in Great Britain. The new legislation is
expected to come into force in 2026. Under the UK Medical Devices Regulations, in order to be lawfully placed on the Great Britain
market, Class I (non-sterile, non-measuring or non-re-useable) medical devices need to be self-certified, in accordance with United
Kingdom Conformity Assessment (“UKCA”), and other medical devices need to be “UKCA” certified by a UK approved body.
However, certain medical devices in compliance with: the EU Medical Devices Directive can continue to be placed on the Great
Britain market until the sooner of certificate expiration or June 30, 2028 while certain medical devices in compliance with the EU
Medical Devices Regulation can continue to be placed on the Great Britain market until the sooner of certificate expiration or June 30,
2030. Medical devices also need to bear a physical UKCA mark in order to be lawfully placed on the Great Britain market. However,
one of the key topics in the MHRA’s recent consultation was to obtain feedback on whether to remove the requirement for a medical
device and its labeling (i.e. packaging and instructions for use) in Great Britain to bear a physical UKCA mark. Instead of requiring a
medical device and its labeling to bear a UKCA mark, manufacturers would be required to assign a unique design identification
(“UDI”) to medical devices before they are placed on the Great Britain market. If this change is implemented, we may no longer be
required to affix the physical UKCA mark to our devices, but we may need to assign and affix a UDI. Understanding and ensuring
compliance with any new requirements is likely to lead to further complexity and increased costs to our business. If there is
insufficient UK approved body capacity, there is a risk that our product certification could be delayed which might impact our ability
to market products in Great Britain after the respective transition periods.
From time to time, legislation is drafted and introduced in the U.S. Congress that could significantly change the statutory
provisions governing the regulation of medical devices. In addition, the FDA may change its policies, adopt additional regulations or
revise existing regulations, or take other actions, which may prevent or delay marketing authorization of our future products under
development or impact our ability to modify any products for which we have already obtained marketing authorizations on a timely
basis or otherwise increase the costs associated with compliance. For example, in February 2024, the FDA issued a final rule to amend
and replace the Quality System Regulation (“QSR”), which sets forth the FDA’s current good manufacturing practice requirements for
medical devices, to align more closely with the International Organization for Standardization (“ISO”) standards. Specifically, this
final rule, which the FDA expects to go into effect on February 2, 2026, establishes the “Quality Management System Regulation”,
which among other things, incorporates by reference the quality management system requirements of ISO 13485:2016. Although our
quality system is currently designed to comply with ISO 13485:2016 in connection with our activities outside of the U.S., and
although the FDA has stated that the standards contained in ISO 13485:2106 are substantially similar to those set forth in the QSR, it
is unclear the extent to which this final rule, once effective, could impose additional or different regulatory requirements on us that
could increase the costs of compliance or otherwise negatively affect our business.
Failure to comply with regulatory requirements could have a material adverse effect on our business, financial condition and
results of operations. Later discovery of previously unknown problems with a product or manufacturer could result in fines, delays or
suspensions of regulatory clearances, approvals or certification, seizures or recalls of products, physician advisories or other field
actions, operating restrictions and/or criminal prosecution. We may also initiate field actions as a result of a failure to strictly comply

23
with our internal quality policies. The failure to receive product approval clearance or certification on a timely basis, suspensions of
regulatory clearances or certifications, seizures or recalls of products, physician advisories or other field actions, or the withdrawal of
product approval or certification by the FDA or other comparable agencies (or notified bodies where applicable) in foreign countries
could have a material adverse effect on our business, financial condition and results of operations.
Our products and operations are subject to various foreign and U.S. federal and state healthcare laws and regulations, which
could expose us to penalties.
Our products and our operations may be directly, or indirectly through our customers, subject to various foreign and U.S. federal
and state healthcare laws and regulations, including, without limitation, anti-kickback, false claims and privacy statutes. These laws
may restrict, among other things, the development, sale, marketing and distribution of our products. These laws include:
•
the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting,
receiving, offering or paying remuneration, directly or indirectly, to induce, or in return for, the purchase or
recommendation of an item or service reimbursable under a federal healthcare program, such as the Medicare and
Medicaid programs. A person or entity does not need to have actual knowledge of the statute or specific intent to violate it
to be deemed to have committed a violation;
•
federal civil and criminal false claims laws, including the False Claims Act, and civil monetary penalty laws, which
prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, false or
fraudulent claims for payment from Medicare, Medicaid, or other third-party payors. In addition, the government may
assert that a claim including items or services resulting from a violation of the U.S. federal Anti-Kickback Statute
constitutes a false or fraudulent claim for purposes of the False Claims Act;
•
the federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), which created new federal criminal
statutes that prohibit executing a scheme to defraud any healthcare benefit program and making false statements relating
to healthcare matters. Similar to the U.S. federal Anti-Kickback Statute, a person or entity does not need to have actual
knowledge of the statute or specific intent to violate it to be deemed to have committed a violation;
•
HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, or HITECH, and its
implementing regulations, which imposes certain requirements relating to the privacy, security, and transmission of
individually identifiable health information;
•
the federal physician “Sunshine Act”, which requires manufacturers of drugs, devices, biologics, and medical supplies to
report annually to Centers for Medicare & Medicaid Services (the “CMS”) information related to (i) payments and other
transfers of value to physicians (as defined by statute), certain other healthcare providers, including physician assistants
and nurse practitioners, and teaching hospitals, and (ii) ownership and investment interests held by physicians and their
immediate family members;
•
state and foreign law equivalents of each of the above federal laws, such as (i) anti-kickback and false claims laws that
may apply to items or services reimbursed by any third-party payors, including commercial insurers; (ii) state laws that
require device manufacturers to comply with the industry’s voluntary compliance guidelines and the applicable
compliance guidance promulgated by the federal government, or otherwise restrict payments that may be made to
healthcare providers and other potential referral sources; (iii) laws that require device manufacturers to report information
related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures;
and (iv) laws governing the privacy and security of health information in certain circumstances, many of which differ
from each other in significant ways, thus complicating compliance efforts.
Efforts to ensure that our business operations comply with applicable healthcare laws may involve substantial costs. If our
operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be
subject to, without limitation, civil, criminal and administrative penalties, damages, monetary fines, disgorgement, possible exclusion
from participation in governmental healthcare programs, contractual damages, reputational harm, diminished profits and future
earnings, and curtailment or restructuring of our operations. Further, defending against any such actions can be costly, time-
consuming and may require significant financial and personnel resources. Therefore, even if we are successful in defending against
any such actions that may be brought against us, our business may be impaired.
Our business is indirectly subject to healthcare industry cost containment and healthcare reform measures that could result
in reduced sales of our products.
Several of our customers rely on third party payors, such as government programs and private health insurance plans, to
reimburse some or all of the cost of the procedures in which our products are used. The continuing efforts of governments, insurance
companies and other payors of healthcare costs to contain or reduce those costs could lead to patients being unable to obtain approval

24
for payment from these third-party payors for procedures in which our products are used. If that occurs, sales of medical devices may
decline significantly and our customers may reduce or eliminate purchases of our products, or demand further price reductions. The
cost containment measures that healthcare payors are instituting both in the U.S. and internationally could reduce our revenues and
harm our operating results.
In addition, in the U.S. and other jurisdictions, there have been, and we expect there will continue to be, a number of legislative
and regulatory changes and proposed changes to reform healthcare systems. Various elements of healthcare reforms, such as
comparative effectiveness research, an independent payment advisory board, payment system reforms, including shared savings pilots,
and other provisions, could meaningfully change the way healthcare is developed and delivered and may have material adverse impact
on numerous aspects of our business, results of operations and financial condition.
Changes in government regulations related to our business or our products could reduce demand for our products or
increase our expenses.
We are subject to many governmental regulations, including, but not limited to, the laser radiation safety regulations of the
Radiation Control for Health and Safety Act administered by the Center for Devices and Radiological Health, a branch of the FDA,
and certain health regulations related to the manufacture of products using beryllium, an element used in some of our products.
Among other things, these regulations require us to file annual reports, to maintain quality control and sales records, to perform
product testing, to distribute appropriate operating manuals, to conduct safety reviews, to incorporate design and operating features in
products sold to end-users, and to certify and label our products. Depending on the class of the product, various warning labels must
be affixed and certain protective devices must be installed.
We are also subject to regulatory oversight, including comparable enforcement mechanisms, in the markets we serve. We
compete in many markets in which we and our customers must comply with federal, state, local and international regulations, such as
environmental, health and safety and food and drug regulations. We develop, configure and market our products to meet customer
needs created by those regulations. Any significant changes in government regulations could reduce demand for our products or
increase our expenses, which in turn could adversely affect our business, financial condition and results of operations.
Actual or perceived failures to comply with applicable data protection, privacy and security laws, regulations, standards, and
other requirements may adversely impact our business and financial results.
Laws and regulations in various countries around the world with regards to cybersecurity, privacy and data protection are
rapidly expanding and creating a complex compliance environment. These laws include evolving legislation with respect to the
collection, storage, handling, use, disclosure, transfer, and security of personal data and the notification requirements in the event of
unauthorized access to or acquisition of certain types of personal information. Implementation standards and enforcement practices are
likely to remain uncertain for the foreseeable future, and we cannot yet determine the impact that future laws, regulations, standards,
or perception of their requirements may have on our business. This evolution may create uncertainty in our business, affect our ability
to operate in certain jurisdictions or to collect, store, transfer, use and share personal information, necessitate the acceptance of more
onerous obligations in our contracts, result in liability or impose additional costs on us. Failure to comply with these laws may affect
our reputation and operating results negatively, subject us to significant liabilities, costs or expenses, and may require significant
management time and attention.
In some cases, these legal requirements may be either unclear in their interpretation and application or they may have
inconsistent or conflicting requirements with each other. In addition, some of the privacy and data protection laws and regulations in
the U.S., the EU, China and other countries place restrictions on our ability to process personal data across our business or across
country borders, and could impact our business and operations. Compliance with these laws, many of which entail substantial
penalties for non-compliance, or future regulations could impose even greater compliance burdens and risks on us.
Furthermore, the Federal Trade Commission (“FTC”) and many state Attorneys General continue to enforce federal and state
consumer protection laws against companies for online collection, use, dissemination and security practices that appear to be unfair or
deceptive. For example, according to the FTC, failing to take appropriate steps to keep consumers’ personal information secure can
constitute violations under Section 5(a) of the Federal Trade Commission Act. The FTC expects a company’s data security measures
to be reasonable and appropriate in light of the sensitivity and volume of consumer information it holds, the size and complexity of its
business, and the cost of available tools to improve security and reduce vulnerabilities.
The EU’s General Data Protection Regulation (the “GDPR”), the CCPA, and the data protection and security laws of other
states and countries impose additional requirements with respect to disclosure and deletion of personal information of their residents,
imposing penalties for violations and, in some cases, private right of action for data breaches. These laws, and similar legislation that
is developing or has been recently enacted, impose transparency and other obligations with respect to personal data of their respective
residents and provide residents with similar rights for certain types of data breaches. We have invested, and continue to invest, human

25
and technology resources in our data compliance efforts that may be time-intensive and costly. Despite our efforts, there is a risk that
we may be subject to fines and penalties for non-compliance and experience litigation, reputational harm and business interruption if
we fail to protect the privacy of third-party data or to comply with the GDPR, CCPA, and other applicable data privacy and protection
regimes.
If we fail to implement new information technology systems successfully, our business could be adversely affected.
We rely on centralized information systems to keep financial records, process orders, manage inventory, process shipments to
customers, and operate other critical functions. We often need to upgrade our information technology infrastructure, including
implementing new or upgrading existing enterprise resource planning (“ERP”) systems and other complementary information
technology systems. We have invested, and will continue to invest, significant capital and human resources in system upgrades and
new ERP systems. Any disruptions, delays or deficiencies in the transition, design and implementation of the upgrades and new ERP
systems, particularly any disruptions, delays or deficiencies that impact our operations, could have a material adverse effect on our
results of operations and cash flows.
We may experience difficulties as we transition to these new or upgraded systems and processes, including loss of data and the
ability to process customer orders, ship products, provide services and support to our customers, issue sales invoices, collect accounts
receivable, fulfill contractual obligations, satisfy internal and external financial reporting requirements in a timely manner, or
otherwise run our business. We may also experience decreases in productivity as our personnel implement these systems and become
proficient in the new systems. In addition, as we are dependent upon our ability to gather and promptly transmit accurate information
to key decision makers, our business, results of operations and financial condition may be materially and adversely affected if our
information technology infrastructure does not allow us to transmit accurate information, even for a short period of time. Furthermore,
the transition, design and implementation of new or upgraded ERP systems may be much more costly than we anticipated.
Changes in foreign currency rates could have a material adverse effect on our financial position, results of operations, and
cash flows.
A portion of our revenue is derived from our European and Asian operations and includes transactions in Euros, British Pounds,
Chinese Yuan and Japanese Yen, while our products are mainly manufactured in the U.S., the U.K., Germany and China. In the event
of a decline in the value of the Euro, British Pounds, Chinese Yuan or Japanese Yen, we typically experience a decline in our revenues
and profit margins. If we increase the selling prices on our products sold in Europe and Asia in order to maintain profit margins and
recover costs, we may lose customer sales to lower cost competitors. Consequently, a strong U.S. dollar may adversely affect reported
revenues and our profitability.
Additionally, balances maintained in foreign currencies create additional financial exposure to changing foreign currency rates.
If foreign currency rates were to change significantly, we could incur material losses. While we use foreign currency contracts and
other risk management techniques to hedge our foreign currency exposures, we cannot be certain that our efforts will be adequate to
protect us against significant foreign currency rate fluctuations or that such efforts will not expose us to additional exchange rate risks.
Our results of operations will be adversely affected if we fail to realize the full value of our intangible assets.
As of December 31, 2024, we had $769.9 million of net intangible assets, including goodwill, on our consolidated balance sheet.
Net intangible assets consist principally of goodwill, customer relationships, patents, trademarks, tradenames, and core technologies.
Goodwill and indefinite-lived intangible assets are tested for impairment at least on an annual basis. All other intangible assets are
evaluated for impairment should discrete events occur that call into question the recoverability of the intangible assets.
Adverse changes in our business, adverse changes in the assumptions used to determine the fair value of our reporting units, or
the failure to grow our businesses may result in an impairment of our intangible assets, which could adversely affect our results of
operations.
Our reliance upon OEM customers subjects us to credit, inventory, and business failure risks beyond our control.
Our sales depend upon the ability of our OEM customers to develop and sell systems that incorporate our products. Adverse
economic conditions, large inventory positions, limited marketing resources and other factors influencing these OEM customers could
have a substantial adverse effect on our financial results. We cannot assure investors that our OEM customers will not experience
financial or other difficulties that could adversely affect their operations and, in turn, adversely affect our results of operations and
financial condition.

26
The loss of sales, or significant reductions in orders from, any major customers may have a material adverse effect on us.
Our top ten customers accounted for approximately 37% of our sales for the year ended December 31, 2024. In any one
reporting period, our major customers may contribute an even larger percentage of our consolidated sales. The loss, or any significant
reduction in orders from, any of these customers, including reductions due to economic, market or competitive conditions or
regulatory requirements, would likely have a material adverse effect on our business, financial condition and results of operations.
None of our significant customers has entered into an agreement with us requiring it to purchase any minimum quantity of our
products.
Attempts to lessen the adverse effect of any loss or reduction of sales through the rapid addition of new customers would be
difficult because customers typically require lengthy qualification periods prior to placing volume orders with a new supplier. Our
future success will continue to depend upon: our ability to maintain relationships with existing key customers; our ability to attract
new customers and satisfy any required qualification periods; our ability to introduce new products in a timely manner for existing and
new customers; and our ability to gain customers in new, emerging segments of our markets.
Increasing scrutiny and changing expectations from investors, customers, governments and other stakeholders and third
parties with respect to corporate sustainability and responsibility practices may cause us to incur additional costs or expose us to
additional risks.
There has been increased public focus and scrutiny from investors, governmental and nongovernmental organizations,
customers, and other stakeholders and third parties on corporate sustainability and responsibility practices in recent years, including
with respect to global warming and climate change, diversity, equity and inclusion, and labor and human rights, among other similar
issues. Both the standard setting and regulatory landscapes are evolving and extremely complex, presenting significant compliance
challenges. Such increased complexity and scrutiny may result in increased costs, increased risk of litigation or reputational damage
relating to our sustainability and responsibility practices or performance, enhanced compliance or disclosure obligations, or other
adverse impacts on our business, financial condition or results of operations. Many different governmental organizations are
promulgating reporting standards and rules that focus on a myriad of sustainability topics, including new reporting requirements in
various jurisdictions. For example, we may be subject to, among others, the requirements of the EU Corporate Sustainability
Reporting Directive, other EU directives, EU and EU member state regulations, various disclosure requirements (such as information
on greenhouse gas emissions, climate risks, use of offsets, and emissions reduction claims) from the State of California as well as the
SEC’s stayed rule on climate related disclosures, if put in place. Additional local, state, federal and international laws and rules with
respect to sustainability and corporate responsibility matters may be enacted in the future and the extent and scope of their
requirements and impacts on our business are unknown. As we continue to focus on developing our sustainability and corporate
responsibility practices, such practices may not meet the standards of all of our stakeholders, and both advocates and opponents of
such practices are increasingly resorting to a range of activism forms, including media campaigns, shareholder proposals, and
litigations, to advance their perspectives. There has similarly been an increase in activism and litigation alleging that corporate
diversity, equity and inclusion programs may discriminate against certain groups. Many of our large, global customers are also
committing to long-term targets to reduce greenhouse gas emissions within their supply chains. If we are unable to support customers
in achieving these reductions, we may lose revenue if our customers find other suppliers who are better able to support such
reductions. A failure, or perceived failure, to respond to expectations of all key stakeholders could cause harm to our business and
reputation and have a negative impact on the market price of our common shares. Further, organizations that provide information to
investors on corporate governance and related matters have developed rating processes for evaluating companies on sustainability and
corporate responsibility matters. Such ratings are used by some investors to inform their investment or voting decisions. Unfavorable
ratings could lead to negative investor sentiment towards us and/or our industry, which could have a negative impact on our access to
and costs of capital.
The effects of climate change and related regulatory responses may adversely impact our business.
The intensifying effects of climate change present physical, liability, and transition risks with both macro and micro
implications for companies and financial markets. There is increasing concern that a gradual increase in global average temperatures
due to increased concentration of carbon dioxide and other greenhouse gases in the atmosphere are causing significant changes in
weather patterns around the globe and an increase in the frequency and severity of natural disasters (such as floods, droughts, wildfires
and severe storms). Such events could, among other things, disrupt our operations, including by damaging or destroying our facilities
or those of our suppliers, which may cause us to suffer losses and additional costs to maintain or resume operations or as a result of
supply chain-related delays or cancellations, which could have an adverse impact on our business and results of operations. In
addition, implementing changes to mitigate risks associated with such events may result in substantial additional operational expenses
in the medium- and long-term, which may materially affect our profitability.
In addition, concerns over climate change and sustainability have led to some foreign, domestic and local legislative and
regulatory initiatives directed at limiting carbon dioxide and other greenhouse gas emissions. We may experience increased costs in

27
order to execute upon our sustainability goals and comply with future climate-change related government mandates as well as stricter
environmental protection laws, which could have an adverse impact on our results of operations and financial condition. Certain
regulations may require us to redesign our products to ensure compliance with the applicable standards. These redesigns may
adversely affect the performance of our products, add greater testing lead-times for product introductions and reduce our profitability.
Risks Relating to Taxes
Novanta Inc. may be subject to U.S. federal income taxation even though it is a non-U.S. corporation.
Novanta Inc. is a holding company organized in Canada and is subject to Canadian tax laws. However, we are also subject to
U.S. tax rules and file U.S. federal income tax returns for our operations in the U.S. In addition, distributions or payments from
entities in one jurisdiction to entities in another jurisdiction may be subject to income and/or withholding taxes. We do not intend to
operate in a manner that will cause Novanta Inc. to be treated as engaged in a U.S. trade or business or otherwise be subject to U.S.
federal income taxes on its income, but it generally will be subject to U.S. federal withholding tax on certain U.S. sourced passive
income items, such as dividends, royalties and certain types of interest.
Our effective tax rate is subject to fluctuation, which could impact our financial position and earnings per share.
Our effective tax rate is subject to fluctuation as the effective income tax rate for each year is a function of (a) taxable income
levels in numerous tax jurisdictions with varying tax rates, (b) our ability to utilize recognized deferred tax assets, (c) taxes, interest,
and/or penalties resulting from tax audits and, (d) credits and deductions as a percentage of total taxable income. From time to time,
the U.S., foreign and state governments make substantive changes to tax rules where significant judgment is required to determine the
impact of such changes on our provision for income taxes, which may result in increased costs. For example, the Organisation for
Economic Co-operation and Development Pillar Two framework provides a mechanism for countries to impose top-up tax on global
income arising in jurisdictions with a tax rate below the global corporate minimum income tax rate of 15%. We may be subject to
additional tax obligations in countries that choose to adopt new tax requirements such as the proposed Pillar Two rules. Further, such
tax law changes may cause our effective tax rate to fluctuate between periods.
Risks Relating to Our Common Shares and Our Capital Structure
We may require additional capital to adequately respond to business challenges or opportunities and repay or refinance our
existing indebtedness, but this capital may not be available on acceptable terms or at all.
We may require additional capital to adequately respond to future business challenges or opportunities, including, but not
limited to, the need to develop new products or enhance our existing products, the need to invest in cloud-based ERP systems and
other digital technology platforms to help accelerate the growth of our businesses, the need to build inventory or to invest other cash to
support business growth, and opportunities to acquire complementary businesses and technologies.
As of December 31, 2024, we had outstanding debt of $419.2 million under our amended and restated senior secured credit
agreement (as amended, the “Third Amended and Restated Credit Agreement”) and $346.2 million of additional borrowing capacity
available under the revolving credit facility. If we are unable to satisfy the conditions in the Third Amended and Restated Credit
Agreement or our needs exceed the amounts available under the revolving credit facility, we may need to obtain equity or debt
financing. If we raise additional funds through further issuances of equity or convertible debt securities, our existing shareholders
could suffer significant dilution. Any new equity securities we issue could have rights, preferences and privileges superior to those of
the holders of our common shares. Further, our Third Amended and Restated Credit Agreement restricts our ability to obtain
additional debt financing from other sources. If we are unable to obtain adequate financing or obtain financing on terms satisfactory to
us when we need it, our ability to continue to support our business growth and to respond to business challenges could be significantly
limited. In addition, the terms of any additional equity or debt issuances may adversely affect the value and price of our common
shares.
Our existing indebtedness could adversely affect our future business, financial condition and results of operations.
As of December 31, 2024, we had $419.2 million of outstanding debt. This level of debt could have significant consequences on
our future operations, including:
•
reducing the availability of our cash flow to fund working capital, capital expenditures, research and development efforts,
acquisitions and other general corporate purposes, and limiting our ability to obtain additional financing for these
purposes;
•
limiting our flexibility in planning for or reacting to, and increasing our vulnerability to, changes in our business, changes
in the general economic environment, and market changes in the industries in which we operate; and

28
•
placing us at a competitive disadvantage compared to our competitors that have less debt or are less leveraged.
Any of these factors could have an adverse effect on our business, results of operations and financial condition.
In addition, as a global corporation, we have significant cash balances held in foreign countries. Some of these balances may not
be immediately available to repay our debt.
Our Third Amended and Restated Credit Agreement, as amended, contains covenants that limit our ability to engage in activities
that may be in our long-term best interest. Our failure to comply with those covenants could result in an event of default which, if not
cured or waived, could result in the acceleration of all of our borrowings thereunder.
General Risk Factors
The market price for our common shares may be volatile.
The market price of our common shares could be subject to wide fluctuations. These fluctuations could be caused by:
•
quarterly variations in our results of operations;
•
changes in earnings estimates by analysts;
•
conditions in the markets we serve;
•
trading phenomena such as “short squeeze”; or
•
general market, political or economic conditions.
In addition, the stock market has experienced extreme price and volume fluctuations in recent years. These fluctuations have had
a substantial effect on the market prices of many companies, often unrelated to the operating performance of the specific companies.
These market fluctuations could adversely affect the price of our common shares.
We are exposed to the credit risk of some of our customers and to credit exposures in weakened markets, which could
adversely affect our results of operations.
Customers with liquidity issues may lead to additional bad debt expense. There can be no assurance that our open credit
customers will pay the amounts they owe to us or that the reserves we maintain will be adequate to cover such credit exposures. In
addition, to the extent that turmoil in the credit markets or increases in interest rates make it more difficult for some customers to
obtain financing, their ability to pay may be adversely impacted. Our customers’ failure to pay and/or our failure to maintain sufficient
reserves could have a material adverse effect on our future cash flows and financial condition.
If we fail to maintain appropriate internal controls in the future, we may not be able to report our financial results
accurately, which may adversely affect our stock price and our business.
While our management and our independent registered public accounting firm concluded that our internal control over financial
reporting was effective as of December 31, 2024, it is possible that material weaknesses may be identified in the future.
As part of our growth strategy, we intend to make additional acquisitions of privately held businesses. Prior to becoming part of
our consolidated company, the acquired businesses would not be required to implement or maintain the disclosure controls and
procedures or internal control over financial reporting that are required of public companies. We are required to integrate the acquired
businesses into our system of disclosure controls and procedures and internal control over financial reporting, but we cannot provide
assurance as to how long the integration process may take. Additionally, we may need to improve our internal control or those of any
business we acquire. This could result in significant costs to us and could require us to divert substantial resources.
If we are unable to maintain effective internal controls, we may be unable to comply with the requirements of the SEC or the
Sarbanes-Oxley Act of 2002. This could result in a restatement of our financial statements, the imposition of sanctions, or
investigation by regulatory authorities. Any such action or other negative results caused by our inability to meet our internal control
and financial reporting requirements or to comply with legal and regulatory requirements could adversely affect our business and the
trading price of our common shares. Material weaknesses in our internal control over financial reporting could also reduce our ability
to obtain financing or could increase the cost of any financing we obtain.
Item 1B. Unresolved Staff Comments
None.

29
Item 1C. Cybersecurity
Cybersecurity Risk Management and Strategy
We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality,
integrity, and availability of our critical systems and information.
We design and assess our program based on various cybersecurity frameworks, such as the National Institute of Standards and
Technology (“NIST”) as well as International Organization for Standardization (“ISO”) 27001. We use these cybersecurity
frameworks and information security standards as a guide to help us identify, assess, and manage cybersecurity risks relevant to our
business.
Our cybersecurity risk management program is designed to be integrated into our overall risk management program, and shares
common methodologies and governance processes across the risk management program. Key elements of our cybersecurity risk
management program, include but are not limited, to the followings:
•
risk assessments designed to help identify material risks from cybersecurity threats to our critical systems and
information;
•
a security team and an external service provider principally responsible for managing (1) our cybersecurity risk
assessment processes, (2) our security controls, and (3) our response to cybersecurity threats and incidents;
•
the use of external service providers, where appropriate, to assess, test, or otherwise assist with aspects of our
cybersecurity security processes;
•
cybersecurity awareness training for our employees, including incident response personnel and senior management, on a
quarterly basis as part of the risk mitigation strategy;
•
quarterly testing of the effectiveness of the cybersecurity awareness training;
•
a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents;
•
a third-party risk management process for key service providers, based on our assessment of their criticality to our
operations and respective risk profile, suppliers, and vendors; and
•
cybersecurity internal and external penetration testing.
We face risks from cybersecurity threats that, if realized, are reasonably likely to materially affect us, including our operations,
business strategy, results of operations, or financial condition. We have not experienced any incidents that have materially affected us,
including our operations, business strategy, results of operations, or financial condition.
Cybersecurity Governance
The Board of Directors (the “Board”) recognizes the need for continually monitoring our information security risks and
cybersecurity initiatives. The Audit Committee of our Board undertakes the primary oversight responsibility over our cybersecurity
risks and information security controls. Management briefs the Audit Committee on information security matters at each quarterly
meeting of the Audit Committee. In addition, management updates the Audit Committee regarding any potentially material
cybersecurity incidents, if any, as well as any incidents with lesser potential impact.
In addition to the role the Audit Committee plays in overseeing enterprise and cybersecurity risks, the Environmental, Social
and Governance (“ESG”) Committee reviews and oversees our overall cybersecurity program, including its strategy and processes,
and is updated by management on the status and development of the cybersecurity programs at each of the ESG Committee’s
meetings.
Both the Audit Committee and the ESG Committee report to the full Board regarding their activities, including those related to
our cybersecurity risks and program. The full Board also receives briefings from management at least once a year on our cybersecurity
risk management program. Board members receive presentations on cybersecurity topics presented by the Chief Information Officer
(“CIO”) and Chief Information Security Officer (“CISO”).
Our management team, including our IT management team, is responsible for assessing and managing our material risks from
cybersecurity threats. The CISO/CIO oversees the overall cybersecurity risk management program, and the Deputy Chief Information
Security Officer (“DCISO”) has the primary operational responsibilities over our cybersecurity program, including supervising both
our internal cybersecurity personnel and our retained external cybersecurity consultants. The CISO, who is also our CIO, has over 23
years of experience managing global IT operations, including strategy, applications, infrastructure, information security, support and
execution. The CISO/CIO holds a Master of Science degree in computer science and engineering (with a specialization in Information

30
Assurance) and a Doctorate of Engineering Management/Systems Engineering degree. Our DCISO has served in various roles in
information security for over 16 years and holds a Bachelor of Science degree in mathematics and computer science and a Master of
Science degree in computer science.
Our management team takes steps to stay informed about and monitor efforts to prevent, detect, mitigate, and remediate
cybersecurity risks and incidents through various means, which may include briefings from internal security personnel, threat
intelligence and other information obtained from governmental, public, or private sources, including external consultants engaged by
us, and alerts and reports produced by security tools deployed in the information technology environment.
Item 2. Properties
Our principal owned and leased properties as of December 31, 2024 are listed in the table below.
Location
Principal Use
Current Segment
Approximate
Square Feet
Owned/Leased
Bedford, Massachusetts
United States
Manufacturing, R&D,
Marketing, Sales and
Administration
Automation Enabling
Technologies, Medical
Solutions, Corporate
147,000
Leased; expires in 2031
Apex, North Carolina
United States
Manufacturing, R&D,
Marketing, Sales and
Administration
Automation Enabling
Technologies
117,000
Leased; expires in 2028
Ludwigsstadt
Germany
Manufacturing and
Administration
Medical Solutions
105,000
Owned
Přelouč
Czech Republic
Manufacturing and
Administration
Medical Solutions
95,000
Owned
Wackersdorf
Germany
R&D
Automation Enabling
Technologies
68,000
Owned
Mukilteo, Washington,
United States
Manufacturing, R&D,
Marketing, Sales and
Administration
Automation Enabling
Technologies
63,000
Owned
Additional manufacturing, research and development, sales, service and logistics sites are located in California, Connecticut,
Florida, Michigan, New York, and Oregon within the United States, and in China, Czech Republic, Germany, Italy, Japan, Spain and
the United Kingdom. These additional facilities cover approximately 670,000 square feet, of which approximately 560,000 square feet
are leased and approximately 110,000 square feet are owned.
We consider our facilities suitable and adequate for the purposes for which they are used and do not anticipate difficulty in
renewing existing leases or in finding alternative facilities. We believe all our properties have been properly maintained.
Item 3. Legal Proceedings
The Company is subject to various legal proceedings and claims that arise in the ordinary course of business. See Note 17 to
Consolidated Financial Statements for additional information about legal proceedings involving the Company.
Item 4. Mine Safety Disclosures
Not applicable.

31
PART II
Item 5. Market for Registrant’s Common Shares, Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Information
The Company’s common shares, no par value, are traded on the Nasdaq Global Select Market under the ticker symbol “NOVT”.
Holders
As of the close of business on February 17, 2025, there were approximately 30 holders of record of the Company’s common
shares. Since many of the common shares are registered in “nominee” or “street” names, the Company believes that the total number
of beneficial owners is considerably higher.
Dividend Policy
The Company has never declared or paid cash dividends on its common shares and does not anticipate paying any cash
dividends in the foreseeable future.
Recent Sales of Unregistered Securities
None
Purchases of Equity Securities by the Issuer and Affiliated Purchaser
In February 2020, the Company's Board of Directors approved a share repurchase plan (the “2020 Repurchase Plan”),
authorizing the repurchase of $50.0 million worth of the Company's common shares. No shares were repurchased during the three
months and year ended December 31, 2024. As of December 31, 2024, the Company had $49.5 million available for future share
repurchases under the 2020 Repurchase Plan. There is no expiration date for the 2020 Repurchase Plan.

32
Performance Graph
The following graph compares the cumulative total return on the Company’s common shares with the cumulative total return on
the Nasdaq Composite Index and the Russell 2000 Index for the period from December 31, 2019 through December 31, 2024. The
comparison assumes an investment of $100 was made on December 31, 2019 in the Company’s common shares and in each of the
indices and, in the case of the indices, it also assumes reinvestment of all dividends. The performance shown is not necessarily
indicative of future performance.
December 31,
2019
December 31,
2020
December 31,
2021
December 31,
2022
December 31,
2023
December 31,
2024
Novanta Inc.
$
100.00
$
133.67
$
199.38
$
153.63
$
190.42
$
172.74
Nasdaq Composite Index
$
100.00
$
141.54
$
172.93
$
116.67
$
168.75
$
218.65
Russell 2000 Index (1)
$
100.00
$
119.96
$
137.74
$
109.59
$
128.14
$
142.93
(1)
Copyright © Russell Investments 2024. All rights reserved.

33
Item 6. [Reserved]
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in
conjunction with the Consolidated Financial Statements and Notes included in Item 8 of this Annual Report on Form 10-K. The
MD&A contains certain forward looking statements within the meaning of the United States Private Securities Litigation Reform Act
of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
In addition to historical financial information, the following discussion and analysis contains forward-looking statements that involve
risks, uncertainties and assumptions. These forward-looking statements include, but are not limited to, our future financial results and
our financial condition; our belief that the Purchasing Managers Index may provide an indication of the impact of general economic
conditions on our sales into the advanced industrial end market; our strategy; drivers of revenue growth and our growth expectations
in various markets; management’s plans and objectives for future operations, expenditures and product development, and investments
in research and development; business prospects; potential of future product releases and expansion of our product and service
offerings; anticipated revenue performance; industry trends; market conditions; our competitive position; the loss of sales, or
significant reduction in orders from, any major customers; our ability to contain or reduce costs; changes in economic and political
conditions; changes in accounting principles; changes in actual or assumed tax liabilities; expectations regarding tax exposures;
anticipated reinvestment of future earnings and dividend policy; anticipated expenditures in regard to the Company’s benefit plans;
future acquisitions and integration and anticipated benefits from acquisitions and dispositions; anticipated economic benefits and
expected costs of restructuring programs; ability to repay our indebtedness; our intentions regarding the use of cash; expectations
regarding legal and regulatory requirements, including environmental requirements, and our compliance thereto; and other
statements that are not historical facts. Our actual results could differ materially from those anticipated in these forward-looking
statements as a result of various important factors, including those set forth in Item 1A of this Annual Report on Form 10-K under the
heading “Risk Factors.” The words “anticipates,” “believes,” “expects,” “intends,” “future,” “estimates,” “plans,” “could,”
“would,” “should,” “potential,” “continues,” and similar words or expressions (as well as other words or expressions referencing
future events, conditions or circumstances) identify forward looking statements. Readers should not place undue reliance on any such
forward looking statements, which speak only as of the date they are made. Management and the Company disclaim any obligation to
publicly update or revise any such statements to reflect any change in its expectations or in events, conditions, or circumstances on
which any such statements may be based, or that may affect the likelihood that actual results will differ from those contained in the
forward looking statements, except as required under applicable law.
Business Overview
Novanta Inc. and its subsidiaries (collectively referred to as, the “Company”, “Novanta”, “we”, “us”, “our”) is a leading global
supplier of core technology solutions that give medical and advanced industrial original equipment manufacturers (“OEMs”) a
competitive advantage. We combine deep proprietary technology expertise and competencies in precision medicine, precision
manufacturing, robotics and automation, and advanced surgery with a proven ability to solve complex technical challenges. This
enables us to engineer core components and sub-systems that deliver extreme precision and performance, tailored to our customers'
demanding applications.
End Markets
We primarily operate in two end markets: the medical market and the advanced industrial market.
Medical Market
For the year ended December 31, 2024, the medical market accounted for approximately 55% of our revenue. Revenue from our
products sold to the medical market is generally affected by hospital, life science, and other healthcare provider capital spending,
growth rates of surgical procedures, changes in regulatory requirements and laws, demand levels for life science automation
technology, aggregation of purchasing by healthcare networks, changes in technology requirements, timing of OEM customers’
product development and new product launches, changes in customer or patient preferences, and general demographic trends.
Advanced Industrial Market
For the year ended December 31, 2024, the advanced industrial market accounted for approximately 45% of our revenue.
Revenue from our products sold to the advanced industrial market is affected by a number of factors, including changing technology
requirements and preferences of our customers, productivity or quality investments in a manufacturing environment, the financial
condition of our customers, changes in regulatory requirements and laws, and general economic conditions. We believe that the

34
Purchasing Managers Index on manufacturing activities specific to different regions around the world may provide an indication of the
impact of general economic conditions on our sales into the advanced industrial market.
Strategy
Our strategy is to drive sustainable, profitable growth through short-term and long-term initiatives, including:
•
disciplined focus on our diversified business model of providing functionality to long life-cycle OEM customer platforms
in attractive medical and advanced industrial niche markets;
•
improving our business mix to increase medical sales as a percentage of total revenue by:
-
introducing new products aimed at attractive medical applications, such as minimally invasive and robotic surgery,
ophthalmology, patient monitoring, drug delivery, clinical laboratory testing and life science equipment;
-
deepening our key account management relationships with and driving cross selling of our product offerings to
leading medical equipment manufacturers; and
-
pursuing complementary medical technology acquisitions;
•
increasing our penetration of high growth advanced industrial applications, such as laser materials processing, intelligent
end-of-arm robotic technology solutions, robotics, laser additive manufacturing, automation and metrology, by working
closely with OEM customers to launch application specific products that closely match the requirements of each
application;
•
broadening our portfolio of enabling proprietary technologies and capabilities through increased investment in new
product development, and investments in application development to further penetrate existing customers, while
expanding the applicability of our solutions to new markets;
•
broadening our product and service offerings through the acquisition of innovative and complementary technologies and
solutions in medical and advanced industrial technology applications;
•
expanding sales and marketing channels to reach new target customers;
•
improving our existing operations to expand profit margins and improve customer satisfaction by implementing lean
manufacturing principles, strategic sourcing across our major production sites, and optimizing and limiting the growth of
our fixed cost base; and
•
attracting, retaining, and developing world-class talented and motivated employees.
Significant Events and Updates
Acquisition of Motion Solutions
On January 2, 2024, we completed the acquisition of Motion Solutions Parent Corp. (“Motion Solutions”), an Irvine, California
based provider of highly engineered integrated solutions, specializing in proprietary precision motion and advanced motion control
solutions, for a total purchase price of $192.0 million in cash, net of working capital adjustments. The acquisition was financed with
borrowings under our revolving credit facility. The addition of Motion Solutions enhances our product portfolio and further expands
our presence in attractive medical and precision medicine applications. The Motion Solutions acquisition is included in our Medical
Solutions reportable segment.
Reporting Segment Change
During the fourth quarter of 2024, we updated our organizational structure and re-aligned our financial reporting structure under
two reportable segments: Automation Enabling Technologies and Medical Solutions. Prior to the reorganization, our historical
reportable segments were: Precision Medicine and Manufacturing, Robotics and Automation, and Medical Solutions. Prior period
segment financial information has been recast to align with the new reportable segments.
Business Environment
In recent years, the global economy has faced significant challenges, including inflation, supply chain disruptions, business
slowdowns, labor shortages, and market volatility. We address macroeconomic challenges by continuing to execute our strategy.
There have been improvements in the supply chain with better on-time deliveries, and recent efforts have successfully addressed talent

35
shortages. However, uncertainty remains about overall macroeconomic conditions due to geopolitical tensions and possible changes in
trade policies.
Economic tensions and changes in trade policies, such as higher tariffs, retaliatory measures, and renegotiated free trade
agreements, changes in government funding, and the ongoing impact from prolonged inflationary pressures could impact the global
market for our products. In addition, we continue to monitor geopolitical conflict in Israel, Russia and Ukraine for any potential
impact on our businesses.
Overview of Financial Results
Total revenue for 2024 was $949.2 million, an increase of $67.6 million, or 7.7%, versus 2023. This increase was primarily due
to revenue from our 2024 acquisition, partially offset by a decrease in demand in the advanced industrial and medical end markets.
The effect of our 2024 acquisition resulted in an increase in revenue of $82.4 million, or 9.4%.
Operating income for 2024 was $110.6 million, and remained flat versus the prior year. This was primarily attributable to an
increase in gross profit of $21.6 million, partially offset by an increase in selling, general and administrative (“SG&A”) expenses of
$11.5 million, an increase in amortization expense of $5.3 million, an increase in research and development and engineering (“R&D”)
expenses of $3.8 million, and an increase in restructuring, acquisition and related costs of $0.9 million.
Basic earnings per common share (“basic EPS”) of $1.78 in 2024 decreased $0.25 from basic EPS of $2.03 in 2023. Diluted
earnings per common share (“diluted EPS”) of $1.77 in 2024 decreased $0.25 from diluted EPS of $2.02 in 2023. The decreases in
basic EPS and diluted EPS were primarily attributable to an increase in interest expense and an increase in income tax provision.
Specific components of our operating results for 2024, 2023 and 2022 are further discussed below.
Results of Operations
The following table sets forth external revenue by reportable segment for 2024, 2023 and 2022 (dollars in thousands):
% Change
% Change
2024
2023
2022
2024 vs. 2023
2023 vs. 2022
Automation Enabling Technologies
$
490,620
$
499,220
$
534,090
(1.7)%
(6.5)%
Medical Solutions
458,625
382,442
326,813
19.9%
17.0%
Total
$
949,245
$
881,662
$
860,903
7.7%
2.4%
Automation Enabling Technologies
Automation Enabling Technologies segment revenue in 2024 decreased by $8.6 million, or 1.7%, versus 2023, primarily due to
a decrease in demand in advanced industrial markets.
Automation Enabling Technologies segment revenue in 2023 decreased by $34.9 million, or 6.5%, versus 2022, primarily due to
a decrease in demand in the advanced industrial markets, partially offset by an increase in medical markets.
Medical Solutions
Medical Solutions segment revenue in 2024 increased $76.2 million, or 19.9%, versus 2023, primarily due to revenue from our
2024 acquisition, and an increase in sales from our advanced surgery products, partially offset by a decrease in revenue from our
precision medicine products.
Medical Solutions segment revenue in 2023 increased $55.6 million, or 17.0%, versus 2022, primarily due to increases in sales
from our advanced surgery and precision medicine products, and $8.1 million of revenue contributions from our 2022 acquisition.

36
Gross Profit
The following table sets forth the gross profit and gross profit margin for each of our reportable segments for 2024, 2023 and
2022 (dollars in thousands):
2024
2023
2022
Gross profit:
Automation Enabling Technologies
$
234,975
$
234,798
$
245,005
Medical Solutions
189,957
170,787
139,031
Unallocated
(3,387)
(5,688)
(5,564)
Total
$
421,545
$
399,897
$
378,472
Gross profit margin:
Automation Enabling Technologies
47.9%
47.0%
45.9%
Medical Solutions
41.4%
44.7%
42.5%
Total
44.4%
45.4%
44.0%
Gross profit and gross profit margin can be influenced by a number of factors, including product mix, pricing, volume,
manufacturing efficiencies and utilization, costs for raw materials and outsourced manufacturing, headcount, inventory obsolescence
and fair value adjustments, warranty expenses, and intangible amortization.
Automation Enabling Technologies
Automation Enabling Technologies segment gross profit for 2024 increased $0.2 million, or 0.1%, versus 2023, primarily due to
an increase in gross profit margin, partially offset by a decrease in revenue. Automation Enabling Technologies segment gross profit
margin was 47.9% in 2024, versus a gross profit margin of 47.0% for 2023. The increase in gross profit margin was primarily
attributable to a lower cost of poor quality, partially offset by unfavorable factory utilization as a result of lower sales.
Automation Enabling Technologies segment gross profit for 2023 decreased $10.2 million, or 4.2%, versus 2022, primarily due
to a decrease in revenue. Automation Enabling Technologies segment gross profit margin was 47.0% in 2023, versus a gross profit
margin of 45.9% for 2022. The increase in gross profit margin was primarily attributable to improved factory productivity and the
impact of business interruption insurance recovery payments, partially offset by an increase in inventory reserves as a result of a
demand decline in the advanced industrial market and higher cost of poor quality.
Medical Solutions
Medical Solutions segment gross profit for 2024 increased by $19.2 million, or 11.2%, versus 2023, primarily due to an increase
in revenue. Medical Solutions gross profit margin was 41.4% for 2024, versus a gross profit margin of 44.7% for 2023. The decrease
in gross profit margin was primarily due to an inventory related charge associated with a precision medicine product, and the dilutive
effect of our 2024 acquisition, partially offset by improved factory utilization in our advanced surgery products.
Medical Solutions segment gross profit for 2023 increased by $31.8 million, or 22.8%, versus 2022, primarily due to an increase
in both revenue and gross profit margin. Medical Solutions gross profit margin was 44.7% for 2023, versus a gross profit margin of
42.5% for 2022. The increase in gross profit margin was primarily due to improved factory efficiency.
Operating Expenses
The following table sets forth operating expenses for 2024, 2023, and 2022 (dollars in thousands):
% Change
% Change
2024
2023
2022
2024 vs. 2023
2023 vs.
2022
Research and development and engineering
$
95,515
$
91,682
$
85,770
4.2%
6.9%
Selling, general and administrative
175,943
164,460
158,901
7.0%
3.5%
Amortization of purchased intangible assets
25,794
20,445
26,338
26.2%
(22.4)%
Restructuring, acquisition and related costs
13,709
12,814
4,384
7.0%
192.3%
Total
$
310,961
$
289,401
$
275,393
7.4%
5.1%

37
Research and Development and Engineering Expenses
Research and development and engineering (“R&D”) expenses are primarily comprised of employee compensation and related
expenses and cost of materials for R&D projects.
R&D expenses were $95.5 million, or 10.1% of revenue, in 2024, versus $91.7 million, or 10.4% of revenue, in 2023. R&D
expenses increased in terms of total dollars primarily due to an increase in costs from our 2024 acquisition.
R&D expenses were $91.7 million, or 10.4% of revenue, in 2023, versus $85.8 million, or 10.0% of revenue, in 2022. R&D
expenses increased in terms of total dollars primarily due to higher compensation related expenses.
Selling, General and Administrative Expenses
Selling, general and administrative (“SG&A”) expenses include costs for sales and marketing, sales administration, finance,
human resources, legal, information systems and executive management.
SG&A expenses were $175.9 million, or 18.5% of revenue, in 2024, versus $164.5 million, or 18.7% of revenue, in 2023.
SG&A expenses increased in terms of total dollars primarily due to increases in costs from our 2024 acquisition and discretionary
spending.
SG&A expenses were $164.5 million, or 18.7% of revenue, in 2023, versus $158.9 million, or 18.5% of revenue, in 2022.
SG&A expenses increased in terms of total dollars and as a percentage of revenue primarily due to increases in compensation related
expenses and discretionary spending.
Amortization of Purchased Intangible Assets
Amortization of purchased intangible assets is charged to our Automation Enabling Technologies and our Medical Solutions
segments. Amortization of developed technologies is included in cost of revenue in the consolidated statement of operations.
Amortization of customer relationships, trademarks, trade names, backlog and other intangibles are included in operating expenses in
the consolidated statement of operations.
Amortization of purchased intangible assets, excluding the amortization of developed technologies that is included in cost of
revenue, was $25.8 million, or 2.7% of revenue, in 2024, versus $20.4 million, or 2.3% of revenue, in 2023. The increase, in terms of
total dollars and as a percentage of revenue, was the result of more acquired intangible assets from our 2024 acquisition.
Amortization of purchased intangible assets, excluding the amortization of developed technologies that is included in cost of
revenue, was $20.4 million, or 2.3% of revenue, in 2023, versus $26.3 million, or 3.1% of revenue, in 2022. The decrease, in terms of
total dollars and as a percentage of revenue, was primarily due to certain intangible assets being fully amortized in 2022.
Restructuring, Acquisition and Related Costs
Restructuring, acquisition and related costs primarily relate to our restructuring programs, acquisition related costs incurred for
completed acquisitions, acquisition costs related to future potential acquisitions and failed acquisitions, and changes in fair value of
contingent considerations.
We recorded restructuring, acquisition and related costs of $13.7 million in 2024, versus $12.8 million in 2023. The increase is
primarily as a result of our 2024 acquisition and lower restructuring related charges.
We recorded restructuring, acquisition and related costs of $12.8 million in 2023, versus $4.4 million in 2022. The restructuring
costs increased $7.4 million primarily related to the severance and related costs and facility costs associated with the closure of a small
manufacturing facility to improve efficiencies.

38
Operating Income (Loss) by Segment
The following table sets forth operating income (loss) by segment for 2024, 2023, and 2022 (in thousands):
2024
2023
2022
Operating Income (Loss)
Automation Enabling Technologies
$
106,403
$
96,281
$
105,425
Medical Solutions
57,532
63,258
46,873
Unallocated
(53,351)
(49,043)
(49,219)
Total
$
110,584
$
110,496
$
103,079
Automation Enabling Technologies
Automation Enabling Technologies segment operating income was $106.4 million, or 21.7% of revenue, in 2024, versus $96.3
million, or 19.3% of revenue, in 2023. The increase in operating income was primarily due to a decrease in restructuring, acquisition
and related costs of $6.8 million, a decrease in R&D expenses of $4.0 million, and a decrease in amortization expense of $1.7 million,
partially offset by an increase in SG&A expenses of $2.6 million.
Automation Enabling Technologies segment operating income was $96.3 million, or 19.3% of revenue, in 2023, versus $105.4
million, or 19.7% of revenue, in 2022. The decrease in operating income was primarily due to a decrease in gross profit of $10.2
million, and an increase in restructuring, acquisition and related costs of $6.8 million, partially offset by a decrease in amortization
expense of $4.7 million, a decrease in R&D expenses of $2.4 million, and a decrease in SG&A expenses of $0.7 million.
Medical Solutions
Medical Solutions segment operating income was $57.5 million, or 12.5% of revenue, in 2024, versus $63.3 million, or 16.5%
of revenue, in 2023. The decrease in operating income was primarily due to an increase in R&D expenses of $7.7 million, an increase
in amortization expense of $7.1 million as a result of our 2024 acquisition, an increase in restructuring, acquisition and related costs of
$5.6 million and an increase in SG&A expenses of $4.6 million, partially offset by an increase in gross profit of $19.2 million.
Medical Solutions segment operating income was $63.3 million, or 16.5% of revenue, in 2023, versus $46.9 million, or 14.3%
of revenue, in 2022. The increase in operating income was primarily due to an increase in gross profit of $31.8 million and a decrease
in amortization expense of $1.2 million, partially offset by an increase in R&D expenses of $9.0 million, an increase in SG&A
expenses of $6.6 million, and an increase in restructuring, acquisition and related costs of $0.9 million.
Unallocated costs
Unallocated costs primarily represent costs of corporate and shared SG&A functions and other public company costs that are not
allocated to the reportable segments, including certain restructuring and most acquisition related costs.
Unallocated costs for 2024 increased by $4.3 million, or 8.8%, from 2023. The increase in operating loss was primarily due to
an increase in SG&A expenses.
Unallocated costs for 2023 decreased by $0.2 million, or $0.4%, from 2022.
Interest Income (Expense), Foreign Exchange Transaction Gains (Losses), and Other Income (Expense), Net
The following table sets forth interest income (expense), foreign exchange transaction gains (losses), and other income
(expense) for 2024, 2023, and 2022 (in thousands):
2024
2023
2022
Interest income (expense), net
$
(31,489)
$
(25,818)
$
(15,616)
Foreign exchange transaction gains (losses), net
$
413
$
(255)
$
67
Other income (expense), net
$
(442)
$
(675)
$
(371)
Interest Income (Expense), Net
Net interest expense was $31.5 million in 2024 versus $25.8 million in 2023. The increase in net interest expense was primarily
due to an increase in average debt levels to fund the 2024 acquisition and an increase in the weighted average interest rate, partially
offset by an increase in interest income. The weighted average interest rate on our outstanding debt was 6.58% and 6.21% for 2024

39
and 2023, respectively. Included in net interest expense was non-cash interest expense of approximately $1.2 million for both 2024
and 2023, related to the amortization of deferred financing costs on our debt.
Net interest expense was $25.8 million in 2023 versus $15.6 million in 2022. The increase in net interest expense was primarily
due to an increase in the weighted average interest rate, partially offset by a decrease in average debt levels under our senior credit
facilities. The weighted average interest rate on our outstanding debt was 6.21% and 3.24% for 2023 and 2022, respectively. Included
in net interest expense was non-cash interest expense of approximately $1.2 million for both 2023 and 2022, related to the
amortization of deferred financing costs on our debt.
Foreign Exchange Transaction Gains (Losses), Net
Foreign exchange transaction gains (losses) were nominal in 2024, 2023, and 2022.
Other Income (Expense), Net
Net other expenses were nominal in 2024, 2023, and 2022.
Income Tax Provision
We recorded a tax provision of $15.0 million in 2024, compared to a tax provision of $10.9 million in 2023. The effective tax
rate for 2024 was 18.9% of income before income taxes, compared to an effective tax rate of 13.0% of income before income taxes for
2023. Our effective tax rate for 2024 differed from the Canadian statutory rate of 29.0% primarily due to the mix of income earned in
jurisdictions with varying tax rates, $3.0 million benefit for foreign derived intangible income, $4.0 million benefit from U.K. patent
box deductions and $2.6 million benefit from R&D and other tax credits, partially offset by a $1.9 million increase in valuation
allowances and a $1.7 million detriment related to disallowed compensation.
We recorded a tax provision of $10.9 million in 2023. The effective tax rate for 2023 was 13.0% of income before income taxes.
Our effective tax rate for 2023 differed from the Canadian statutory rate of 29.0% primarily due to the mix of income earned in
jurisdictions with varying tax rates, $4.5 million benefit for foreign derived intangible income, $4.2 million benefit from U.K. patent
box deductions and $3.6 million benefit from R&D and other tax credits, partially offset by $2.1 million increase in valuation
allowances and a $2.6 million detriment related to disallowed compensation.
On December 12, 2022, the EU member states agreed to implement the Organization for Economic Co-operation and
Development’s (“OECD”) Pillar Two Model Rules. These rules, which impose a global corporate minimum income tax rate of 15%,
have been enacted or introduced in proposed legislation in 45 countries. Additional countries are actively considering changes to their
tax laws to adopt certain parts of the OECD’s proposals. We operate in many jurisdictions that have adopted these rules. We fall under
the transitional safe harbor rules in the majority of jurisdictions in which we operate and are therefore not subject to the Pillar Two
global minimum tax. Where we cannot apply the safe harbor rules, we have determined that we have no Pillar Two tax adjustments.
Although future legislation or changes in our financial results could materially increase our global minimum tax expense, this
legislation did not have a direct material impact in 2024.
Net Income
Net income was $64.1 million for 2024, compared to $72.9 million for 2023, and $74.1 million for 2022, reflecting the impact
of the factors described above.
Liquidity and Capital Resources
We assess our liquidity in terms of our ability to generate cash to fund our operating, investing, and financing activities. Our
primary ongoing cash requirements are funding operations, capital expenditures, investments in businesses, and repayment of debt and
related interest payments. Our primary sources of liquidity are cash flows from operations and borrowings under our revolving credit
facility. We believe our future operating cash flows will be sufficient to meet our future operating and capital expenditure cash needs
for the foreseeable future, including at least the next 12 months. The availability of borrowing capacity under our revolving credit
facility provides another potential source of liquidity for any future capital expenditures and other liquidity needs. In addition, we have
the ability to expand our borrowing capacity by up to $350.0 million by exercising the accordion feature under our revolving credit
agreement. We may seek to raise additional capital, which could be in the form of bonds, convertible debt or preferred or common
equity, to fund business development activities or other future investing cash requirements, subject to approval by the lenders in the
Third Amended and Restated Credit Agreement. There is no assurance that such capital will be available on reasonable terms or at all.

40
Significant factors affecting the management of our ongoing cash requirements are the adequacy of available bank lines of credit
and our ability to attract long-term capital with satisfactory terms. The sources of our liquidity are subject to all of the risks of our
business and could be adversely affected by, among other factors, risks associated with events outside of our control, such as
economic consequences of global pandemics and geopolitical conflicts, prolonged supply chain disruptions and electronics and other
material shortages, a decrease in demand for our products, our ability to integrate current and future acquisitions, deterioration in
certain financial ratios, availability of borrowings under our revolving credit facility, and market changes in general. See “Risks
Relating to Our Common Shares and Our Capital Structure” included in Item 1A of this Annual Report on Form 10-K.
Our ability to make payments on our indebtedness and to fund our operations may be dependent upon the operating income and
the distribution of funds from our subsidiaries. However, as local laws and regulations and/or the terms of our indebtedness restrict
certain of our subsidiaries from paying dividends and transferring assets to us, there is no assurance that our subsidiaries will be
permitted to provide us with sufficient dividends, distributions or loans when necessary.
As of December 31, 2024, $71.7 million of our $114.0 million of cash and cash equivalents was held by our subsidiaries outside
of North America. Generally, our intent is to use cash held in these foreign subsidiaries to fund our local operations or acquisitions by
those local subsidiaries and to pay down borrowings under our senior credit facilities. Approximately $86.6 million of the outstanding
borrowings under our senior credit facilities were held in our subsidiaries outside of North America as of December 31, 2024.
Additionally, we may use intercompany loans to address short-term cash flow needs from various subsidiaries.
In May 2021, our shareholders approved a special resolution to amend the Company’s articles to authorize up to 7.0 million
preferred shares for future issuance. Our Board of Directors may designate and issue one or more series of preferred shares in order to
raise additional capital, provided that no shares of any series may be entitled to more than one vote per share. As of December 31,
2024, no preferred shares were issued and outstanding.
Share Repurchase Plans
Our Board of Directors may approve share repurchase plans from time to time. Under these repurchase plans, shares may be
repurchased at our discretion based on ongoing assessment of the capital needs of the business, the market price of our common
shares, and general market conditions. Shares may also be repurchased through an accelerated share purchase agreement, on the open
market or in privately negotiated transactions in accordance with applicable federal securities laws. Repurchases may be made under
certain SEC regulations, which would permit common shares to be repurchased when we would otherwise be prohibited from doing so
under insider trading laws. While the share repurchase plans are generally intended to offset dilution from equity awards granted to
our employees and directors, the plans do not obligate us to acquire any particular amount of common shares. No time limit is
typically set for the completion of the share repurchase plans, and the plans may be suspended or discontinued at any time. We expect
to fund share repurchases through cash on hand and cash generated from operations.
In February 2020, our Board of Directors approved a share repurchase plan (the “2020 Repurchase Plan”) authorizing the
repurchase of $50.0 million worth of common shares, effective after our prior repurchase plan was completed. Share repurchases have
been made under the 2020 Repurchase Plan pursuant to Rule 10b-18 under the Securities Exchange Act of 1934. During the year
ended December 31, 2022, we repurchased 4 thousand shares for an aggregate purchase price of $0.5 million at an average price of
$116.95 per share under the 2020 Repurchase Plan. No shares were repurchased during the years ended December 31, 2024 or 2023.
As of December 31, 2024, we had $49.5 million available for share repurchases under the 2020 Repurchase Plan.
Senior Credit Facilities
In December 2019, we entered into the Third Amended and Restated Credit Agreement (as amended from time to time, the
“Credit Agreement”), originally consisting of a $100.0 million U.S. dollar equivalent euro-denominated (approximately €90.2 million)
5-year term loan facility and a $350.0 million 5-year revolving credit facility (collectively, the “Senior Credit Facilities”). The term
loan facility requires quarterly scheduled principal repayments of approximately €1.1 million that began in March 2020 with the
remaining principal balance due upon maturity. We may make additional principal payments at any time, which will reduce the next
quarterly installment payment due. We may pay down our revolving credit facility with cash on hand and cash generated from future
operations at any time.
On March 27, 2020, we entered into an amendment (the “First Amendment”) to the Credit Agreement and exercised a portion of
the uncommitted accordion feature. The First Amendment increased the revolving credit facility commitment under the Third
Amended and Restated Credit Agreement by $145.0 million, from $350.0 million to $495.0 million, and reset the uncommitted
accordion feature to $200.0 million for potential future expansion.
On June 2, 2020, we entered into an amendment (the “Second Amendment”) to the Credit Agreement. The Second Amendment
revised our consolidated leverage ratio definition (as defined in the Third Amended and Restated Credit Agreement) allowing for the

41
use of up to $25 million unrestricted cash and cash equivalents as a reduction to consolidated funded indebtedness (as defined in the
Third Amended and Restated Credit Agreement).
On October 5, 2021, we entered into an amendment (the “Fourth Amendment”) to the Credit Agreement to exercise the
accordion feature. The Fourth Amendment increased the revolving credit facility commitment under the Third Amended and Restated
Credit Agreement by $200.0 million, from $495.0 million to $695.0 million, and reset the uncommitted accordion feature to $200.0
million for potential future expansion.
On March 10, 2022, the Company entered into an amendment (the “Fifth Amendment”) to the Credit Agreement to extend the
maturity date thereof from December 31, 2024 to March 10, 2027, update the pricing grid, replace LIBOR with SOFR as the reference
rate for U.S. dollar borrowings, and increase the uncommitted accordion feature from $200.0 million to $350.0 million.
As of December 31, 2024, we had $70.4 (€67.6) million term loan and $348.8 million revolver borrowings outstanding under
our Senior Credit Facilities. The borrowings outstanding under the Senior Credit Facilities bear interest at rates based on (a) the Base
Rate, as defined in the Credit Agreement, plus a margin ranging between 0.00% to 0.75% per annum, determined by reference to our
consolidated leverage ratio, or (b) the Term SOFR Screen Rate, the Alternative Currency Daily Rate or the Alternative Currency Term
Rate, as defined in the Credit Agreement, plus a margin ranging between 0.75% and 1.75% per annum, determined by reference to our
consolidated leverage ratio. In addition, we are obligated to pay a commitment fee on the unused portion of the revolving credit
facility, ranging between 0.20% and 0.30% per annum, determined by reference to our consolidated leverage ratio. As of
December 31, 2024, we had outstanding borrowings under the Senior Credit Facilities denominated in Euro and U.S. Dollars of $86.6
million and $332.6 million, respectively.
The Credit Agreement contains various covenants that, we believe, are usual and customary for this type of agreement,
including a maximum allowed leverage ratio and a minimum required fixed charge coverage ratio (as defined in the Third Amended
and Restated Credit Agreement). The following table summarizes these financial covenants and our compliance therewith as of
December 31, 2024:
Requirement
Actual as of
December 31, 2024
Maximum consolidated leverage ratio (1)
3.50
1.86
Minimum consolidated fixed charge coverage ratio
1.50
4.69
(1) Maximum consolidated leverage ratio shall be increased to 4.00 for four consecutive quarters following a designated
acquisition, as defined in the Fifth Amendment.
In addition, the Credit Agreement contains various other customary representations, warranties and covenants applicable to the
Company and its subsidiaries, including: (i) limitations on certain payments; (ii) limitations on fundamental changes involving the
Company; (iii) limitations on the disposition of assets; and (iv) limitations on indebtedness, investments, and liens.
Cash Flows
Cash and cash equivalents totaled $114.0 million as of December 31, 2024, versus $105.1 million as of December 31, 2023. The
net increase in cash and cash equivalents is primarily attributable to cash provided by operating activities of $158.5 million, and
$198.0 million of borrowings under our revolving credit agreement, partially offset by $191.2 million of cash consideration for the
2024 acquisition, $131.1 million of debt repayments, $17.2 million of capital expenditures, and $9.7 million of payroll withholding tax
payments related to net share settlement upon vesting of share-based compensation awards.
The following table summarizes our cash and cash equivalent balances, cash flows and unused borrowing capacity available
under our revolving credit facility for the years indicated (in thousands):
2024
2023
2022
Cash and cash equivalents, end of year
$
113,989
$
105,051
$
100,105
Net cash provided by operating activities
$
158,512
$
120,075
$
90,779
Net cash used in investing activities
$
(208,189)
$
(19,892)
$
(42,541)
Net cash provided by (used in) financing activities
$
56,943
$
(97,853)
$
(60,154)
Unused borrowing capacity available under the revolving credit facility, end
of year
$
346,249
$
416,596
$
336,587

42
Operating Cash Flows
Net cash provided by operating activities was $158.5 million in 2024, versus $120.1 million in 2023. Cash provided by
operating activities increased from 2023 primarily as a result of reduced net working capital and lower income tax payments, partially
offset by higher interest payments as a result of increased debt levels.
Net cash provided by operating activities was $120.1 million in 2023, versus $90.8 million in 2022. Cash provided by operating
activities increased from 2022 primarily as a result of higher operating income and less cash outflows from changes in net working
capital, partially offset by higher income tax payments and higher interest payments.
Investing Cash Flows
Net cash used in investing activities was $208.2 million in 2024, primarily related to the $191.2 million of cash considerations
(net of cash acquired) paid for our 2024 acquisition and capital expenditures of $17.2 million.
Net cash used in investing activities was $19.9 million in 2023, primarily related to capital expenditures of $20.0 million.
Net cash used in investing activities was $42.5 million in 2022, primarily driven by the $22.4 million of cash consideration (net
of cash acquired) paid for our 2022 acquisition. We also paid $19.6 million for capital expenditures and $1.5 million for contingent
consideration related to our 2016 asset acquisition of video signal processing and management technologies. We received $0.8 million
net working capital adjustment in 2022 related to our 2021 acquisition.
We have no material commitments to purchase property, plant and equipment as of December 31, 2024. We expect to use
approximately $20 million to $30 million in 2025 for capital expenditures related to investments in new property, plant and equipment
for our existing businesses.
Financing Cash Flows
Net cash provided by financing activities was $56.9 million in 2024, primarily due to borrowings under the credit facilities of
$198.0 million, partially offset by $131.1 million of term loan and revolving credit facility repayments and $9.7 million of payroll
withholding tax payments related to net share settlement upon vesting of share-based compensation awards.
Net cash used in financing activities was $97.9 million in 2023, primarily due to $86.6 million of term loan and revolving credit
facility repayments and $10.6 million of payroll withholding tax payments related to net share settlement upon vesting of share-based
compensation awards.
Net cash used in financing activities was $60.2 million in 2022, primarily due to $59.0 million of term loan and revolving credit
facility repayments, $46.3 million of contingent consideration payments related to prior year acquisitions, $11.7 million of payroll
withholding tax payments related to net share settlement upon vesting of share-based compensation awards, $10.0 million of
repurchases of common shares, and $2.5 million of debt issuance costs in connection with the Fifth Amendment, partially offset by
$69.9 million of borrowings under our revolving credit facility used to fund the contingent consideration payment for our 2021
acquisition and the cash consideration for our 2022 acquisition.
In 2025, we are contractually required to make $4.7 million in repayments under our term loan facility. In addition, we may
make optional repayments under our revolving credit facility from time to time with available cash generated from future operating
activities.
Other Liquidity Matters
Pension Plans
We maintain a defined benefit pension plan (the “U.K. Plan”) in Novanta Technologies U.K. Limited, a wholly owned
subsidiary of the Company. Our U.K. Plan was closed to new members in 1997 and stopped accruing additional pension benefits for
existing members in 2003, thereby limiting our obligation to benefits earned through that date. Benefits under this plan were based on
the participants’ years of service and compensation as of the date the plan was frozen, adjusted for inflation. On July 1, 2013, the
Company provided a Guarantee (the “Guarantee”) in favor of the trustees of the U.K. Plan with respect to all present and future
obligations and liabilities (whether actual or contingent and whether owed jointly or severally and in any capacity whatsoever) under
the U.K. Plan.
Our funding policy is to fund the U.K. Plan based on actuarial methods as permitted by the Pensions Regulator in the U.K. The
results of funding valuations depend on both the funding deficit and the assumptions used, such as asset returns, discount rates,

43
mortality rates, retail price inflation and other market driven assumptions. Each assumption used represents one estimate of many
possible future outcomes. The final cost to us will be determined by events as they actually become known, including actual return on
plan assets and pension payments to plan participants. As of December 31, 2024, the fair value of plan assets exceeded the projected
benefit obligation under the U.K. Plan by $4.2 million. Based on the results of the most recent funding valuation in 2024, we will not
be required to contribute any additional funds for the next three years. Future annual funding contributions, if any, will be determined
in the next statutory funding valuation in 2027.
Material Cash Requirements
Senior Credit Facilities
As of December 31, 2024, we had $70.4 million (€67.6 million) term loan and $348.8 million revolving credit facility
borrowings outstanding under the Senior Credit Facilities. The term loan is payable in quarterly installments of approximately €1.1
million ($1.2 million) with the final installment of €58.5 million ($61.0 million) due upon maturity in March 2027. Borrowings under
the revolving credit facility are due at maturity in March 2027.
As of December 31, 2024, future interest payments under our Senior Credit Facilities are estimated to be approximately $52.7
million through maturity based on the current contractual term, with $24.4 million payable within the next twelve months. These
estimates are based on current interest rates on floating rate obligations, as defined in the Third Amended and Restated Credit
Agreement, for the remainder of the contractual life of both the term loan and outstanding borrowings under the revolving credit
facility, and the current commitment fee rate was used for the unused commitments under the revolving credit facility as of
December 31, 2024. These estimates also assume only quarterly term loan payments are made and outstanding revolving credit facility
remains unchanged throughout the remainder of the contractual term. Actual future interest payments will vary due to changes in our
debt level and interest rates. See Note 11, “Debt,” in the Consolidated Financial Statements for further details of our debt obligations
and the timing of expected future payments.
Operating and Finance Leases
We have entered into various lease agreements for office and manufacturing facilities, vehicles, and equipment used in the
normal course of business. As of December 31, 2024, undiscounted operating and finance lease obligations were $65.8 million, with
$12.5 million payable within the next twelve months. See Note 12, “Leases,” in the Consolidated Financial Statements for further
details of our obligations and the timing of expected future payments.
Purchase Obligations
Purchase obligations represent an estimate of all open purchase orders and contractual obligations in the ordinary course of
business for which we have not received the goods or services. As of December 31, 2024, we had $138.7 million of purchase
obligations, with $126.3 million payable within the next twelve months.
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires us to
make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and
liabilities as of the dates of the financial statements and the reported amounts of revenues and expenses for the reporting periods. On
an ongoing basis, we evaluate our estimates, assumptions and judgments, including those related to revenue recognition, inventory
valuation, impairment assessment and valuation of goodwill, intangible assets and tangible long-lived assets, valuation of contingent
consideration obligations, accounting for income taxes, and accounting for loss contingencies. Actual results in the future could differ
significantly from our estimates.
We believe that the following critical accounting policies and estimates most significantly affect the portrayal of our financial
condition and results of operations and require the most difficult and subjective judgments.
Revenue Recognition. We recognize revenue in accordance with Accounting Standards Codification (“ASC”) 606, “Revenue
from Contracts with Customers”. We recognize revenue when control of promised goods or services is transferred to customers. This
generally occurs upon shipment when the title and risk of loss pass to the customer. The vast majority of our revenue is generated
from the sale of distinct products. Revenue is measured as the amount of consideration we expect to receive in exchange for such
products, which is generally at contractually stated prices. Sales taxes and value added taxes collected concurrently with revenue
generating activities are excluded from revenue.

44
Substantially all of our revenue is recognized at a point in time, upon shipment, rather than over time. At the request of our
customers, we may perform professional services, generally for the maintenance and repair of products previously sold to those
customers and for engineering services. Professional services are less than 3% of our consolidated revenue. Revenue is typically
recognized at a point in time when control transfers to the customer upon completion of professional services. These services
generally involve a single distinct performance obligation. The consideration expected to be received in exchange for such services is
normally the contractually stated amount.
We occasionally sell separately priced non-standard/extended warranty services or preventative maintenance plans with the sale
of products. The transfer of control over the service plans is over time. We recognize the related revenue ratably over the terms of the
service plans. The transaction price of a contract is allocated to each performance obligation based on its relative standalone selling
price. Standalone selling prices are generally determined based on the prices charged to customers or using the expected cost plus a
margin.
We account for shipping and handling activities that occur after the transfer of control over the related goods as fulfillment
activities rather than performance obligations. The shipping and handling fees charged to customers are recognized as revenue and the
related costs are recorded in cost of revenue at the time of transfer of control.
We generally provide warranties for our products. The standard warranty period is typically 12 months to 36 months. The
standard warranty period for product sales is accounted for under the provisions of ASC 450, “Contingencies,” as we have the ability
to ascertain the likelihood of the liability and can reasonably estimate the amount of the liability. A provision for the estimated cost
related to warranty is recorded to cost of revenue at the time revenue is recognized. Our estimate of the costs to service warranty
obligations is based on historical experience and expectations of future conditions. To the extent our experience in warranty claims or
costs associated with servicing those claims differ from the original estimates, revisions to the estimated warranty liability are
recorded at that time, with an offsetting entry recorded to cost of revenue.
We expense incremental direct costs of obtaining a contract when incurred if the expected amortization period is one year or
less. These costs are recorded within selling, general and administrative expenses in the consolidated statement of operations. We do
not adjust the promised amount of consideration for the effects of a financing component because the time period between the transfer
of a promised good to a customer and the customer’s payment for that good is typically one year or less.
Inventories. Inventories, which include materials and conversion costs, are stated at the lower of cost or net realizable value,
using the first-in, first-out method. We regularly review inventory quantities on hand and, when necessary, record provisions for
excess and obsolete inventory based on either our forecasted product demand and production requirements or trailing historical usage
of the product. If our sales do not materialize as previously forecasted or at historical levels, we may have to increase our reserve for
excess and obsolete inventory, which would reduce our operating income. If actual market conditions are more favorable than
anticipated, inventory previously written down may be sold, resulting in lower cost of revenue and higher operating income than
expected in that period.
Share-Based Compensation. We record expenses associated with share-based compensation awards to employees and directors
based on the fair value of awards as of the grant date. In addition to service-based awards granted to a wider employee base and stock
options granted to certain members of the executive management team, we typically grant three types of performance-based awards to
certain members of the executive management team: performance-based restricted stock units with company-specific financial
performance conditions (“attainment-based PSUs”), performance-based restricted stock units with market-based performance
conditions (“market-based PSUs”), and performance-based restricted stock units with a hybrid of company-specific financial
performance conditions and market-based performance conditions (“hybrid PSUs”).
For share-based compensation awards that vest over time based on employment, the associated expenses are recognized in the
consolidated statement of operations ratably over the vesting period of the awards, net of estimated forfeitures determined based on
historical forfeiture experience.
For stock options, share-based compensation expenses are recognized based on the fair value of the stock options, which is
determined using the Black-Scholes option pricing model as of the date of grant. Shared-based compensation expenses related to stock
options are recognized on a straight-line basis ratably over the vesting period of the awards. Black-Scholes option pricing model
includes various assumptions, including the expected term of the award, the expected volatility of our common shares and the
expected risk-free interest rate over the expected term of the award, expected dividend payments, and the fair value of our common
shares.
For attainment-based PSUs, share-based compensation expenses are recognized based on the closing price of our common
shares on the date of grant ratably over the vesting period when it is probable that specified performance targets are expected to be
achieved based on management’s projections as of the end of each period. Management’s projections are revised, if necessary, in
subsequent periods when underlying factors change the estimated probability of achieving the performance targets as well as the levels

45
of achievement. When the estimated achievement levels are adjusted at a later date, a cumulative adjustment to the share-based
compensation expense previously recognized would be required. Accordingly, share-based compensation expenses associated with
attainment-based PSUs may differ significantly from period to period based on changes to both the probability and the level of
achievement against the specified performance targets.
For market-based PSUs, share-based compensation expenses are recognized based on the fair value of the market-based PSUs,
which is determined using the Monte-Carlo simulation valuation model as of the date of grant. Shared-based compensation expenses
related to market-based PSUs are recognized on a straight-line basis from the grant date to the end of the performance period, which is
generally three years, regardless of whether the target relative total shareholder return is achieved. The Monte Carlo simulation model
utilizes multiple input variables that determine the probability of satisfying the performance conditions stipulated in the grant
agreement in a large number of simulated scenarios. Key assumptions for the Monte Carlo simulation model include risk-free interest
rate and expected stock price volatility of both the Company’s common shares and the Russell 2000 index.
For hybrid PSUs, share-based compensation expenses are recognized ratably over the vesting period based on the fair value of
the hybrid PSUs as of the grant date and the number of shares that are deemed probable of vesting at the end of the specified
performance period. The fair value of hybrid PSUs is determined using the Monte-Carlo simulation valuation model as of the date of
grant. The probability assessment is performed quarterly and the cumulative effect of a change in the estimated compensation expense,
if any, is recognized in the consolidated statement of operations in the period in which such determination is made. Accordingly,
share-based compensation expenses associated with hybrid PSUs may differ significantly from period to period based on changes to
both the probability and the level of achievement against the specified performance targets.
Valuation of Long-lived Assets. The purchase price we pay for acquired companies is allocated first to the identifiable assets
acquired and liabilities assumed at their estimated fair value. Any excess purchase price is then allocated to goodwill. We make
various assumptions and estimates in order to assign fair value to acquired tangible and intangible assets and liabilities. Key
assumptions used to value identifiable intangible assets typically include revenue growth rates and projected cash flows, discount
rates, royalty rates, technology obsolescence curves, and customer attrition rates, among others. Actual cash flows may vary from
forecasts used to value these assets at the time of the business combination.
The estimated fair value of real estate assets acquired in a business combination is estimated based on comparable sales
information and other market data, if available, as well as using an income or cost approach, specifically the direct capitalization and
replacement value approaches. The direct capitalization and replacement value approaches use key assumptions such as market rent
estimates, capitalization rates, local multipliers and remaining useful life of the real estate assets. Assumptions used are subject to
management judgment and changes in those assumptions could impact the estimation of the fair value.
Our most significant identifiable intangible assets are customer relationships, acquired technologies, trademarks and trade
names. In addition to our review of the carrying value of each asset, the estimated useful life assumptions for identifiable intangible
assets, including the classification of certain intangible assets as “indefinite-lived,” are reviewed on a periodic basis to determine if
changes in circumstances warrant revisions to them. All definite-lived intangible assets are amortized over the periods in which their
economic benefits are expected to be realized.
Impairment analyses of goodwill and indefinite-lived intangible assets are conducted in accordance with ASC 350,
“Intangibles—Goodwill and Other.” We test our goodwill balances annually as of the beginning of the second quarter or more
frequently if indicators are present, or changes in circumstances suggest, that an impairment may exist. Should the fair value of our
goodwill or indefinite-lived intangible assets decline because of reduced operating performance, market declines or other indicators of
impairment, or as a result of changes in the discount rate, charges for impairment loss may be necessary.
We evaluate our goodwill, intangible assets and other long-lived assets for impairment at the reporting unit level which is
generally at least one level below our reportable segments. We have the option of first performing a qualitative assessment to
determine whether it is necessary to perform the quantitative impairment test. In performing the qualitative assessment, we review
factors both specific to the reporting unit and to the Company as a whole, such as financial performance, macroeconomic conditions,
industry and market considerations, and the fair value of each reporting unit as of the last valuation date. If we elect this option and
believe, as a result of the qualitative assessment, that it is more likely than not that the carrying value of goodwill is not recoverable,
the quantitative impairment test is required; otherwise, no further testing is performed.
Alternatively, we may elect to bypass the qualitative assessment and perform the quantitative impairment test instead. This
approach requires a comparison of the carrying value of each of our reporting units to the fair value of these reporting units. If the
carrying value of a reporting unit exceeds its fair value, an impairment charge is recorded for the difference. The fair value of a
reporting unit is estimated primarily using a discounted cash flow (“DCF”) method. The DCF method requires that we forecast future
cash flows for each of the reporting units and discount the cash flow streams based on a weighted average cost of capital (“WACC”)
that is derived, in part, from comparable companies within similar industries. The DCF calculations also include a terminal value
calculation that is based upon an expected long-term growth rate for the applicable reporting unit. The carrying values of each

46
reporting unit include assets and liabilities which relate to the reporting unit’s operations. Additionally, reporting units that benefit
from corporate assets or liabilities are allocated a portion of those corporate assets and liabilities on a proportional basis.
We assess indefinite-lived intangible assets for impairment on an annual basis, and more frequently if impairment indicators are
identified. We also periodically reassess their continuing classification as indefinite-lived intangible assets. Impairment exists if the
fair value of the intangible asset is less than its carrying value. An impairment charge equal to the difference is recorded to reduce the
carrying value to its fair value.
We evaluate amortizable intangible assets and other long-lived assets for impairment in accordance with ASC 360-10-35-15,
“Impairment or Disposal of Long-Lived Assets,” whenever changes in events or circumstances indicate that the carrying values of the
reporting units may exceed the undiscounted cash flow forecasts attributable to the reporting units. If undiscounted cash flow forecasts
indicate that the carrying value of definite-lived intangible assets or other long-lived assets may not be recoverable, a fair value
assessment is performed. For intangible assets, fair value estimates are derived from discounted cash flow forecasts. For other long-
lived assets (primarily property, plant and equipment), fair value estimates are derived from the sources most appropriate for the
particular asset and have historically included such approaches as sales comparison approach and replacement cost approach. If fair
value is less than carrying value, an impairment charge equal to the difference is recorded. We also review the useful life and residual
value assumptions for definite-lived intangible assets and other long-lived assets on a periodic basis to determine if changes in
circumstances warrant revisions to them.
Factors which may trigger an impairment of our goodwill, intangible assets and other long-lived assets include the following:
•
significant underperformance relative to historical or projected future operating results;
•
changes in our use of the acquired assets or the strategy for our overall business;
•
long-term negative industry or economic trends;
•
technological changes or developments;
•
changes in competition;
•
loss of key customers or personnel;
•
adverse judicial or legislative outcomes or political developments;
•
significant declines in our stock price for a sustained period of time; and
•
the decline of our market capitalization below net book value as of the end of any reporting period.
The occurrence of any of these events or any other unforeseeable events or circumstances that materially affect future operating
results or cash flows may cause an impairment that is material to our results of operations or financial position in the reporting period
in which it occurs or is identified.
The most recent annual goodwill and indefinite-lived intangible asset impairment test was performed as of the beginning of the
second quarter of 2024, using a qualitative assessment, noting no impairment. As of December 31, 2024, there were no indicators of
impairment of our long-lived assets.
Accounting for Income Taxes. As part of the process of preparing our consolidated financial statements, we are required to
calculate our income tax provision (benefit) in each of the jurisdictions in which we operate. This process involves estimating our
current income tax provision (benefit) together with assessing temporary differences resulting from differing treatment of items for tax
and accounting purposes. These differences result in deferred tax assets and liabilities, which are reported on our consolidated balance
sheet.
Judgment is required in determining our worldwide income tax provision. In the ordinary course of a global business, there are
many transactions and calculations where the ultimate outcome is uncertain. Although we believe our estimates are reasonable, there
is no assurance that the final outcome of these matters will not be different from that which is reflected in our historical income tax
provisions and accruals. Such differences could have a material impact on our income tax provision and net income in the period in
which such determination is made.
We record a valuation allowance on our deferred tax assets when it is more likely than not that they will not be realized. We
have considered future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for a valuation
allowance. In the event we determine that we are able to realize our deferred tax assets in the future in excess of their net recorded
amounts, an adjustment to the valuation allowance for the deferred tax assets would be recorded and would increase our net income in
the period in which such determination is made. Likewise, should we determine that we will not be able to realize all or part of our net

47
deferred tax assets in the future, an adjustment to the valuation allowance for the deferred tax assets will be recorded and will reduce
our net income in the period in which such determination is made.
In conjunction with our ongoing review of our actual results and anticipated future earnings, we continuously reassess the
adequacy of the valuation allowance currently in place on our deferred tax assets. In 2024, we established a valuation allowance of
$1.9 million recorded on net operating losses, various credits, and other timing items in certain tax jurisdictions. The factors used to
assess the likelihood of realization of deferred tax assets are the forecast of future taxable income, available tax planning strategies
that could be implemented to realize the net deferred tax assets, potential for carryback and future reversals of deferred tax liabilities.
The amount of income taxes we pay is subject to audits by federal, state and foreign tax authorities, which may result in
proposed assessments. We believe that we have adequately provided for any reasonably foreseeable outcome related to these matters.
However, our future results may include favorable or unfavorable adjustments to our tax liabilities in the period that the assessments
are made or resolved, or when the statute of limitations for certain periods expires. As of December 31, 2024, the Company’s total
amount of unrecognized tax benefits was $4.8 million, of which $4.1 million would favorably affect our effective tax rate, if
recognized. Over the next twelve months, we may need to recognize up to $0.8 million of previously unrecognized tax benefits due to
statute of limitations closures.
Income and foreign withholding taxes have not been recognized on the excess of the amount for financial reporting purposes
over the tax basis of investments in foreign subsidiaries that are essentially permanent in nature. This amount becomes taxable upon
the repatriation of assets from a subsidiary or a sale or liquidation of a subsidiary. The amount of undistributed earnings of foreign
subsidiaries totaled $494.9 million as of December 31, 2024. The estimated unrecognized income and foreign withholding tax
liabilities on these undistributed earnings is approximately $7.3 million.
Loss Contingencies. We are subject to legal proceedings, lawsuits and other claims relating to product quality, labor, service
and other matters arising in the ordinary course of business. We review the status of each significant matter and assess our potential
financial exposure on a quarterly basis. If the potential loss from any claim or legal proceeding is considered probable and the amount
can be reasonably estimated, we accrue a liability for the estimated loss. Significant judgment is required in both the determination of
probability and the determination as to whether an exposure is reasonably estimable. Because of uncertainties related to these matters,
accruals are based only on the best information available as of the date of the financial statements. As additional information becomes
available, we will reassess the potential liability related to our pending claims and litigation and may revise our estimates. Such
revisions in the estimates of the potential liabilities could have a material impact on our results of operations and financial position.
We expense legal fees as incurred.
Recent Accounting Pronouncements
See Note 2 to Consolidated Financial Statements for recent accounting pronouncements that could have a significant effect on
us.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
We are exposed to market risks from changes in foreign currency exchange rates and interest rates, which could affect our
operating results, financial position and cash flows. We manage our exposure to these market risks through our regular operating and
financing activities. We address market risks from changes in foreign currency exchange rates through a risk management program
that includes the use of derivative financial instruments to mitigate certain foreign currency transaction exposures from future
settlement of non-functional currency monetary assets and liabilities as of the end of a period.
Foreign Currency Exchange Rate Risk and Sensitivity
We are exposed to changes in foreign currency exchange rates which could affect our operating results as well as our financial
position and cash flows. The foreign currencies to which we have the most significant exchange rate exposures are the Euro, British
Pound, Japanese Yen and Chinese Yuan. The Company manages its foreign currency exposures on a consolidated basis, which allows
the Company to analyze exposures globally and take into account offsetting exposures in certain balances. The primary foreign
currency denominated transactions include revenue and expenses and the resulting accounts receivable and accounts payable balances
reflected on our consolidated balance sheet as well as accounts receivable and accounts payable balances with intercompany trading
partners that are eliminated in consolidation.
In the ordinary course of business, we enter into foreign currency contracts for periods consistent with our committed exposures
to mitigate the effect of foreign currency movements on transactions denominated in foreign currencies. We do not enter into or hold
foreign currency derivative financial instruments for trading or speculative purposes, nor do we enter into derivative financial
instruments to hedge future cash flows or forecasted transactions. The intent of these economic hedges is to offset gains and losses on

48
the underlying exposures from these currencies with gains and losses resulting from the foreign currency contracts that hedge these
exposures.
We had foreign currency contracts with notional amounts totaling $187.4 million and net fair value of $0.2 million as of
December 31, 2024. A hypothetical 10% strengthening of the U.S. dollar against other currencies would result in an approximately
$0.7 million decrease in the net fair value of our foreign currency contracts as of December 31, 2024. By contrast, a hypothetical 10%
weakening of the U.S. dollar against other currencies would result in an approximately $0.7 million increase in the net fair value of
our foreign currency contracts as of December 31, 2024.
Interest Rates
Our exposure to market risk associated with changes in interest rates relates primarily to our borrowings under our Senior Credit
Facilities. We had $419.2 million of outstanding variable rate debt as of December 31, 2024. A 100 basis point increase in interest
rates at December 31, 2024 would increase our annual pre-tax interest expense by approximately $4.2 million.

49
Item 8. Financial Statements and Supplementary Data
NOVANTA INC.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Report of Independent Registered Public Accounting Firm – Deloitte & Touche LLP ..................................................................
50
Report of Independent Registered Public Accounting Firm – PricewaterhouseCoopers LLP.........................................................
52
Consolidated Balance Sheets as of December 31, 2024 and 2023...................................................................................................
53
Consolidated Statements of Operations for the years ended December 31, 2024, 2023 and 2022..................................................
54
Consolidated Statements of Comprehensive Income for the years ended December 31, 2024, 2023 and 2022 .............................
55
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2024, 2023 and 2022..................................
56
Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023 and 2022.................................................
57
Notes to Consolidated Financial Statements ....................................................................................................................................
58

50
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders of Novanta Inc.
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheet of Novanta Inc. and subsidiaries (the “Company”) as of December 31,
2024, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows, for the year
ended December 31, 2024, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial
statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024, and the results of its
operations and its cash flows for the year ended December 31, 2024, in conformity with accounting principles generally accepted in
the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal
Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our
report dated February 25, 2025 expressed an unqualified opinion on the Company’s internal control over financial reporting.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the
Company's financial statements based on our audit. We are a public accounting firm registered with the PCAOB and are required to be
independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations
of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error
or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence
regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used
and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe
that our audit provides a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was
communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material
to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of
critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by
communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or
disclosures to which it relates.
Motion Solutions Acquisition - Refer to Note 4 to the financial statements
Critical Audit Matter Description
The Company completed the acquisition of Motion Solutions Parent Corp. ("Motion Solutions") for cash consideration of
approximately $192.0 million on January 2, 2024. The Company accounted for the acquisition of Motion Solutions under the
acquisition method of accounting for business combinations. Accordingly, the purchase price was allocated to the assets acquired and
liabilities assumed based on the Company's estimate of their respective fair values. The method used by management for determining
the estimated fair value varied depending on the type of asset or liability. The estimated fair value of the developed technology and
customer relationships required management to make significant estimates and assumptions related to the revenue growth rates and
discount rate.
We identified the valuation of the developed technology and customer relationships intangible assets as a critical audit matter because
of the significant estimates and assumptions management made to measure the fair value of the identifiable intangible assets for
purposes of the purchase price allocation. The assessment of the estimate of fair value required a high degree of auditor judgment and
an increased extent of effort, including the need to involve our fair value specialists, when performing audit procedures to evaluate the
reasonableness of management’s assumptions relative to revenue growth rates and discount rate.

51
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to the estimate of the fair value of acquired developed technology and customer relationships for Motion
Solutions included the following, among others:
•
We tested the effectiveness of controls over the valuation of developed technology and customer relationships, including
management's controls over revenue growth rates and discount rates.
•
We evaluated the reasonableness of management's estimate of revenue growth rates:

We compared revenue forecasts assumptions to historical results.

We compared revenue forecasts to peer companies.

We compared revenue forecast and growth rates to similar businesses acquired by the Company in prior years.

With the assistance of our fair value specialists, we compared the long-term growth rate used to calculate the
terminal value to market information.

We compared revenue forecasts to internal communication to management and the Board of Directors and other
information obtained while performing the audit.
•
We evaluated the reasonableness of management's estimate of the discount rate by comparison to the historical discount
rates used on similar prior acquisitions.
•
With the assistance of our fair value specialists, we evaluated the reasonableness of the fair value estimate for the
developed technology and customer relationships and discount rate:

We evaluated the reasonableness of the valuation methodologies selected.

We tested source information underlying the determination of certain assumptions, tested the mathematical accuracy
of calculations and compared those to the amounts selected by management.

We developed an independent range for the discount rate and compared such rate to the Company’s discount rate
used in the valuation of the developed technology and customer relationship assets.
/s/ Deloitte & Touche LLP
Boston, Massachusetts
February 25, 2025
We have served as the Company’s auditor since 2024.

52
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders of Novanta Inc.
Opinion on the Financial Statements
We have audited the consolidated balance sheet of Novanta Inc. and its subsidiaries (the “Company”) as of December 31, 2023, and
the related consolidated statements of operations, of comprehensive income, of stockholders’ equity and of cash flows for each of the
two years in the period ended December 31, 2023, including the related notes (collectively referred to as the “consolidated financial
statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the
Company as of December 31, 2023, and the results of its operations and its cash flows for each of the two years in the period ended
December 31, 2023 in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an
opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the
Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the
Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange
Commission and the PCAOB.
We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free
of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements,
whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test
basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the
accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the
consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts
February 28, 2024, except for the change in the manner in which the Company accounts for segments discussed in Note 18 to the
consolidated financial statements, as to which the date is February 25, 2025
We served as the Company's auditor from 2013 to 2023.

53
NOVANTA INC.
CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. dollars or shares)
December 31,
December 31,
2024
2023
ASSETS
Current Assets
Cash and cash equivalents
$
113,989
$
105,051
Accounts receivable, net of allowance of $505 and $571, respectively
151,026
139,410
Inventories
144,606
149,371
Prepaid income taxes and income taxes receivable
8,076
8,105
Prepaid expenses and other current assets
15,951
13,360
Total current assets
433,648
415,297
Property, plant and equipment, net
113,135
109,449
Operating right-of-use assets
42,908
38,302
Deferred tax assets
22,887
27,862
Other assets
5,991
5,617
Intangible assets, net
185,844
145,022
Goodwill
584,098
484,507
Total assets
$
1,388,511
$
1,226,056
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Current portion of long-term debt
$
4,691
$
4,968
Accounts payable
76,890
57,195
Income taxes payable
16,000
7,767
Current portion of operating lease liabilities
9,879
8,189
Accrued expenses and other current liabilities
60,331
61,056
Total current liabilities
167,791
139,175
Long-term debt
411,949
349,404
Operating lease liabilities
40,548
37,345
Deferred tax liabilities
13,093
16,305
Income taxes payable
4,941
4,435
Other liabilities
4,491
5,932
Total liabilities
642,813
552,596
Commitments and Contingencies (Note 17)
Stockholders’ Equity:
Preferred shares, no par value; Authorized shares: 7,000;
No shares issued and outstanding
-
-
Common shares, no par value; Authorized shares: unlimited;
Issued and outstanding: 35,938 and 35,814, respectively
423,856
423,856
Additional paid-in capital
84,214
70,180
Retained earnings
267,549
203,462
Accumulated other comprehensive loss
(29,921)
(24,038)
Total stockholders’ equity
745,698
673,460
Total liabilities and stockholders’ equity
$
1,388,511
$
1,226,056
The accompanying notes are an integral part of these consolidated financial statements.

54
NOVANTA INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of U.S. dollars or shares, except per share amounts)
Year Ended December 31,
2024
2023
2022
Revenue
$
949,245
$
881,662
$
860,903
Cost of revenue
527,700
481,765
482,431
Gross profit
421,545
399,897
378,472
Operating expenses:
Research and development and engineering
95,515
91,682
85,770
Selling, general and administrative
175,943
164,460
158,901
Amortization of purchased intangible assets
25,794
20,445
26,338
Restructuring, acquisition and related costs
13,709
12,814
4,384
Total operating expenses
310,961
289,401
275,393
Operating income
110,584
110,496
103,079
Interest income (expense), net
(31,489)
(25,818)
(15,616)
Foreign exchange transaction gains (losses), net
413
(255)
67
Other income (expense), net
(442)
(675)
(371)
Income before income taxes
79,066
83,748
87,159
Income tax provision
14,979
10,870
13,108
Net income
$
64,087
$
72,878
$
74,051
Earnings per common share (Note 9):
Basic
$
1.78
$
2.03
$
2.08
Diluted
$
1.77
$
2.02
$
2.06
Weighted average common shares outstanding—basic
35,950
35,844
35,652
Weighted average common shares outstanding—diluted
36,124
36,031
35,909
The accompanying notes are an integral part of these consolidated financial statements.

55
NOVANTA INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands of U.S. dollars)
Year Ended December 31,
2024
2023
2022
Net income
$
64,087
$
72,878
$
74,051
Other comprehensive income (loss):
Foreign currency translation adjustments, net of tax (1)
(7,082)
7,823
(18,674)
Pension liability adjustments, net of tax (2)
1,199
148
(469)
Total other comprehensive income (loss)
(5,883)
7,971
(19,143)
Total comprehensive income
$
58,204
$
80,849
$
54,908
(1)
The tax effect on this component of comprehensive income (loss) was nominal in 2024, 2023 and 2022.
(2)
The tax effect on this component of comprehensive income (loss) was $376, $156 and $(401) in 2024, 2023 and 2022,
respectively.
The accompanying notes are an integral part of these consolidated financial statements.

56
NOVANTA INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands of U.S. dollars or shares)
Common Shares
Additional
Paid-In
Retained
Earning
Accumulated
Other
Comprehensive
# of Shares
Amount
Capital
(Deficit)
Loss
Total
Balance at December 31, 2021
35,601
$
423,856
$
53,768
$
56,533
$
(12,866)
$
521,291
Net income
—
—
—
74,051
—
74,051
Common shares issued under stock plans
276
—
—
—
—
—
Common shares withheld for taxes on vested stock awards
(82)
—
(11,721)
—
—
(11,721)
Repurchases of common shares
(84)
—
(10,000)
—
—
(10,000)
Share-based compensation
—
—
23,108
—
—
23,108
Other comprehensive income (loss), net of tax
—
—
—
—
(19,143)
(19,143)
Balance at December 31, 2022
35,711
423,856
55,155
130,584
(32,009)
577,586
Net income
—
—
—
72,878
—
72,878
Common shares issued under stock plans
173
—
—
—
—
—
Common shares withheld for taxes on vested stock awards
(70)
—
(10,563)
—
—
(10,563)
Repurchases of common shares
—
—
—
—
—
—
Share-based compensation
—
—
25,588
—
—
25,588
Other comprehensive income (loss), net of tax
—
—
—
—
7,971
7,971
Balance at December 31, 2023
35,814
423,856
70,180
203,462
(24,038)
673,460
Net income
—
—
—
64,087
—
64,087
Common shares issued under stock plans
184
—
440
—
—
440
Common shares withheld for taxes on vested stock awards
(60)
—
(9,713)
—
—
(9,713)
Repurchases of common shares
—
—
—
—
—
—
Share-based compensation
—
—
23,307
—
—
23,307
Other comprehensive income (loss), net of tax
—
—
—
—
(5,883)
(5,883)
Balance at December 31, 2024
35,938
$
423,856
$
84,214
$
267,549
$
(29,921)
$
745,698
The accompanying notes are an integral part of these consolidated financial statements.

NOVANTA INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of U.S. dollars)
Year Ended December 31,
2024
2023
2022
Cash flows from operating activities:
Net income
$
64,087
$
72,878
$
74,051
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization
55,563
46,612
53,158
Provision for inventory excess and obsolescence
8,783
7,491
2,988
Impairment of operating lease assets
—
1,853
—
Share-based compensation
23,307
25,588
23,108
Deferred income taxes
(15,909)
(14,726)
(18,654)
Loss (gain) on disposal of fixed assets
(64)
148
(61)
Contingent consideration adjustments
(282)
—
(1,443)
Inventory acquisition fair value adjustments
2,777
—
160
Write-off of unamortized deferred financing costs
—
—
624
Non-cash interest expense
1,162
1,162
1,229
Other non-cash items
170
397
356
Changes in assets and liabilities which provided/(used) cash, excluding
effects from business acquisitions:
Accounts receivable, net of allowance
(6,193)
(127)
(23,246)
Inventories
4,781
11,366
(48,547)
Prepaid expenses and other current assets
(1,492)
709
(814)
Prepaid income taxes, income taxes receivable and income taxes payable
9,013
(12,349)
489
Accounts payable, accrued expenses and other current liabilities
13,062
(20,453)
30,333
Other non-current assets and liabilities
(253)
(474)
(2,952)
Cash provided by operating activities
158,512
120,075
90,779
Cash flows from investing activities:
Purchases of property, plant and equipment
(17,162)
(19,961)
(19,643)
Acquisition of businesses, net of cash acquired and working capital adjustments
(191,200)
—
(21,565)
Payment of contingent consideration related to acquisition of technology assets
—
—
(1,470)
Proceeds from sale of property, plant and equipment
173
69
137
Cash used in investing activities
(208,189)
(19,892)
(42,541)
Cash flows from financing activities:
Borrowings under revolving credit facilities
198,000
—
69,941
Repayments under term loan and revolving credit facilities
(131,066)
(86,552)
(59,029)
Payments of debt issuance costs
—
—
(2,492)
Payments of withholding taxes from share-based awards
(9,713)
(10,563)
(11,721)
Payments of contingent considerations related to acquisitions
—
(81)
(46,254)
Repurchases of common shares
—
—
(10,000)
Other financing activities
(278)
(657)
(599)
Cash provided by (used in) financing activities
56,943
(97,853)
(60,154)
Effect of exchange rates on cash and cash equivalents
1,672
2,616
(5,372)
Increase (decrease) in cash and cash equivalents
8,938
4,946
(17,288)
Cash and cash equivalents, beginning of year
105,051
100,105
117,393
Cash and cash equivalents, end of year
$
113,989
$
105,051
$
100,105
Supplemental disclosure of cash flow information:
Cash paid for interest
$
32,673
$
25,302
$
14,264
Cash paid for income taxes
$
21,152
$
36,903
$
20,291
Income tax refunds received
$
1,553
$
612
$
169
Supplemental disclosure of non-cash investing activities:
Accruals for capital expenditures
$
2,529
$
570
$
1,681
The accompanying notes are an integral part of these consolidated financial statements.
57

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2024
58
1. Organization and Basis of Presentation
Novanta Inc. and its subsidiaries (collectively referred to as the “Company”, or “Novanta”) is a leading global supplier of
core technology solutions that give medical and advanced industrial original equipment manufacturers (“OEMs”) a competitive
advantage. The Company combines deep proprietary technology expertise and competencies in precision medicine, precision
manufacturing, robotics and automation, and advanced surgery with a proven ability to solve complex technical challenges. This
enables Novanta to engineer core components and sub-systems that deliver extreme precision and performance, tailored to the
customers' demanding applications.
Basis of Presentation
The consolidated financial statements have been prepared by the Company in United States (“U.S.”) dollars and in
accordance with accounting principles generally accepted in the U.S., applied on a consistent basis. These consolidated financial
statements include the accounts of Novanta Inc. and its subsidiaries. Intercompany accounts and transactions have been eliminated.
2. Summary of Significant Accounting Policies
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and
liabilities at the dates of the financial statements, and the reported amounts of revenue and expenses during the reporting periods.
Estimates and assumptions are reviewed on an on-going basis and the effects of revisions are reflected in the period in which such
revisions are deemed to be necessary. The Company evaluates its estimates based on historical experience, current conditions, and
various other assumptions that it believes are reasonable under the circumstances. Actual results could differ significantly from
these estimates.
Updated Segment Reporting Structure
During the fourth quarter of 2024, the Company updated its organizational structure and re-aligned its financial reporting
structure under two reportable segments: Automation Enabling Technologies and Medical Solutions. Prior to the reorganization, the
Company's historical reportable segments were: Precision Medicine and Manufacturing, Robotics and Automation, and Medical
Solutions. Prior period segment financial information has been recast to align with the new reportable segments. See Note 18 for
segment results under the new reporting structure.
Foreign Currency Translation
The financial statements of the Company and its subsidiaries outside the U.S. have been translated into U.S. dollars. Assets
and liabilities of foreign operations are translated from foreign currencies into U.S. dollars at the exchange rates in effect as of the
balance sheet date. Revenue and expenses are translated at the weighted average exchange rates for the period. Accordingly, gains
and losses resulting from translating foreign currency financial statements are reported as cumulative translation adjustments, a
separate component of other comprehensive income (loss) in stockholders’ equity. Foreign currency transaction gains and losses
from transactions denominated in currencies other than the functional currencies are included in the accompanying consolidated
statements of operations.
Cash Equivalents
Cash equivalents are highly liquid investments with original maturities of three months or less. These investments are carried
at cost, which approximates fair value.
Accounts Receivable and Credit Losses
Accounts receivable are recorded at the invoiced amounts, net of an allowance for doubtful accounts based on the Company’s
best estimate of probable credit losses. The Company is exposed to credit losses primarily through sales of its products. The
Company assesses each customer’s ability to pay by conducting a credit review which includes consideration of established credit
rating or an internal assessment of the customer’s creditworthiness based on an analysis of their payment history when a credit
rating is not available. The Company monitors its credit exposure through active review of customer balances. The Company’s

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
59
expected loss methodology for accounts receivable is developed through consideration of factors including, but not limited to,
historical collection experience, current customer credit ratings, current customer financial condition, current and future economic
and market condition, and age of the receivables. Charges related to credit losses are included in selling, general and administrative
expenses and are recorded in the period that the outstanding receivables are determined to be uncollectible. Account balances are
charged off against the allowance for doubtful accounts when the Company believes it is certain that the receivable will not be
recovered.
For the years ended December 31, 2024, 2023 and 2022, changes in the allowance for doubtful accounts were as follows (in
thousands):
2024
2023
2022
Balance at beginning of year
$
571
$
995
$
556
Addition to credit loss expense
223
175
532
Write-offs, net of recoveries of amounts previously reserved
(288)
(612)
(92)
Exchange rate changes
(1)
13
(1)
Balance at end of year
$
505
$
571
$
995
Inventories
Inventories, which include materials and conversion costs, are stated at the lower of cost or net realizable value, using the
first-in, first-out method. Cost includes the cost of purchased materials, inbound freight charges, customs duties, trade tariffs on
imported materials and components, external and internal processing and applicable labor and overhead costs. Net realizable value
is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, storage, disposal
and transportation. The Company periodically reviews inventory for potential excess or obsolescence by comparing on-hand
quantities to the forecasted product demand and production requirements or trailing historical usage of each product. The Company
records a charge to cost of revenue for the amount required to reduce the carrying value of inventories to their net realizable value.
Property, Plant and Equipment
Property, plant and equipment are recorded at cost, adjusted for any impairment, less accumulated depreciation. The
Company uses the straight-line method to calculate the depreciation of its property, plant and equipment over their estimated useful
lives. Estimated useful lives range from 10 to 40 years for buildings and building improvements, and 3 to 10 years for machinery
and equipment. Leasehold improvements are depreciated over the lesser of their useful lives or the lease terms, including any
renewal period options that are reasonably assured of being exercised. Repairs and maintenance costs are expensed as incurred.
Certain costs to develop software for internal use are capitalized when the criteria under Accounting Standards Codification
(“ASC”) 350-40, “Internal-Use Software,” are met.
Goodwill, Intangible Assets and Long-Lived Assets
Goodwill represents the excess of the purchase price over the tangible assets, identifiable intangible assets and assumed
liabilities acquired in a business combination. Allocations of the purchase price are based upon a valuation of the fair value of assets
acquired and liabilities assumed as of the acquisition date. Goodwill and indefinite-lived intangibles are not amortized but are
assessed for impairment at least annually to ensure their current fair values exceed their carrying values.
The Company’s most significant identifiable intangible assets are customer relationships, patents and developed technologies,
trademarks and trade names. The fair values of identifiable intangible assets are based on valuations using an income approach, with
estimates and assumptions provided by management of the acquired companies and the Company. The process for estimating the
fair values of identifiable intangible assets requires the use of significant estimates and assumptions, including revenue growth rates,
customer attrition rates, royalty rates, discount rates and projected future cash flows. All definite-lived intangible assets are
amortized over the periods in which their economic benefits are expected to be realized. The Company reviews the useful life
assumptions, including the classification of certain identifiable intangible assets as “indefinite-lived,” on a periodic basis to
determine if changes in circumstances warrant revisions to them. Costs associated with patent and intellectual property applications,
renewals or extensions are typically expensed as incurred.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
60
The Company evaluates its goodwill, intangible assets and other long-lived assets for impairment at the reporting unit level
which is at least one level below the reportable segments.
Impairment Charges
Impairment analyses of goodwill and indefinite-lived intangible assets are conducted in accordance with ASC 350,
“Intangibles — Goodwill and Other.” The Company performs its goodwill impairment test annually at a reporting unit level, which
is generally at least one level below a reportable segment, as of the beginning of the second quarter or more frequently if indicators
are present or changes in circumstances suggest that an impairment may exist.
The Company has the option of first performing a qualitative assessment to determine whether it is necessary to perform the
quantitative impairment test. In performing the qualitative assessment, the Company reviews factors both specific to the reporting
unit and to the Company as a whole, such as financial performance, macroeconomic conditions, industry and market considerations,
and the fair value of each reporting unit as of the last valuation date. If the Company elects this option and believes, as a result of
the qualitative assessment, that it is more likely than not that the carrying value of the reporting unit exceeds its fair value, the
quantitative impairment test is required; otherwise, no further testing is required.
Alternatively, the Company may elect to bypass the qualitative assessment and perform the quantitative impairment test
instead. This approach requires a comparison of the carrying value of each reporting unit to its estimated fair value. The fair value
of a reporting unit is estimated primarily using a discounted cash flow (“DCF”) method. If the carrying value of a reporting unit
exceeds its fair value, an impairment charge is recorded for the difference.
The Company assesses indefinite-lived intangible assets for impairment on an annual basis as of the beginning of the second
quarter, and more frequently if indicators are present, or changes in circumstances suggest, that an impairment may exist. The
Company will also reassess the continuing classification of these intangible assets as indefinite-lived when circumstances change
such that the useful life may no longer be considered indefinite. The fair values of the Company’s indefinite-lived intangible assets
are determined using the relief from royalty method, based on forecasted revenues and estimated royalty rates. If the fair value of an
indefinite-lived intangible asset is less than its carrying value, an impairment charge is recorded for the difference between the
carrying value and the fair value of the impaired asset.
The carrying amounts of definite-lived long-lived assets are reviewed for impairment whenever changes in events or
circumstances indicate that their carrying values may not be recoverable. The recoverability of the carrying value is generally
determined by comparison of the carrying value of the asset group to its undiscounted future cash flows. When this test indicates a
potential for impairment, a fair value assessment is performed. Once an impairment is determined and measured, an impairment
charge is recorded for the difference between the carrying value and the fair value of the impaired asset.
Revenue Recognition
See Note 3 for the Company’s revenue recognition policy.
Leases
The Company leases certain equipment and facilities. The Company determines if an arrangement is a lease at inception.
Operating lease right-of-use assets are included in operating lease assets on the consolidated balance sheet. Operating lease
liabilities are included in the current portion of operating lease liabilities and operating lease liabilities on the consolidated balance
sheet based on the timing of future lease payments. Finance lease assets are included in property, plant and equipment. Finance
lease liabilities are included in accrued expenses and other current liabilities and other liabilities on the consolidated balance sheet
based on the timing of future lease payments. Leases with an initial term of twelve months or less are not recognized on the balance
sheet. The Company recognizes lease expense on a straight-line basis over the lease term. Many of the Company’s lease
arrangements include both lease (e.g., fixed payments including rent) and non-lease components (e.g., common-area maintenance or
other property management costs). The Company accounts for lease and non-lease components separately.
Most leases held by the Company do not provide an implicit rate. The Company determines the present value of future lease
payments using its incremental borrowing rate for the same jurisdiction and term as the associated lease based on the information
available at the lease commencement date. The Company has a centrally managed treasury function; therefore, the Company applies

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
61
a portfolio approach for determining the incremental borrowing rate based on the applicable lease terms and the current economic
environment.
Research and Development and Engineering Costs
Research and development and engineering (“R&D”) expenses are primarily comprised of employee related expenses and
cost of materials for R&D projects. These costs are expensed as incurred.
Share-Based Compensation
The Company records expenses associated with share-based compensation awards to employees and directors based on the
fair value of awards as of the grant date. For share-based compensation awards that vest over time based on employment or service,
the associated expenses are based on the closing market price of the Company’s common shares on the date of grant and are
recognized in the consolidated statements of operations ratably over the respective vesting periods, net of estimated forfeitures.
The Company also grants share-based awards that vest based on employment and certain specified company performance
conditions, market conditions or a hybrid of specified company performance conditions and market conditions. Share-based
compensation expenses for awards with specified company performance conditions are based on the closing market price of the
Company’s common shares on the date of grant and are recognized ratably over their vesting periods when it is probable that the
performance targets are expected to be achieved based on management’s projections. Management’s projections are revised, if
necessary, in subsequent periods when underlying factors change the evaluation of the probability of achieving the performance
targets as well as the estimated levels of achievement. When the estimated achievement levels are adjusted at a later date, a
cumulative adjustment to the share-based compensation expense previously recognized would be recorded in the period such
determination is made. Accordingly, share-based compensation expenses for awards with specified company performance
conditions may differ significantly from period to period based on changes to both the probability and the level of achievement
against the performance targets.
Share-based compensation expenses for awards with market conditions are based on the grant-date fair value, determined
using the Monte-Carlo valuation model, and are recognized on a straight-line basis from the grant date to the end of the performance
period. Compensation expenses for awards with market conditions will not be affected by the number of common shares that will
ultimately be issued upon vesting at the end of the performance period.
Share-based compensation expenses for awards with a hybrid of specified company performance conditions and market
conditions are based on the grant-date fair value, determined using the Monte-Carlo valuation model, and are recognized ratably
over their vesting periods when it is probable that the performance targets are expected to be achieved based on management’s
projections. Management’s projections are revised, if necessary, in subsequent periods when underlying factors change the
evaluation of the probability and the level of achieving the specified company performance targets. When the estimated
achievement levels are adjusted at a later date, a cumulative adjustment to the share-based compensation expense previously
recognized would be recorded in the period such determination is made. Accordingly, share-based compensation expenses for
awards with hybrid conditions may differ significantly from period to period based on changes to both the probability and the level
of achievement against the specified company performance targets.
The Company also grants stock options to certain members of the executive management team to purchase common shares of
the Company at a strike price equal to the closing market price of the Company’s common shares on the date of grant. Stock options
typically vest over time based on employment. Share-based compensation expenses associated with stock options are based on the
grant-date fair value, determined using the Black-Scholes option pricing model, and are recognized on a straight-line basis ratably
over the respective vesting period.
Advertising Costs
Advertising costs are expensed as incurred and are included in selling, general and administrative expenses in the
consolidated statement of operations. Advertising costs were not material for the years ended December 31, 2024, 2023 and 2022.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
62
Restructuring, Acquisition and Related Costs
The Company accounts for its restructuring activities in accordance with the provisions of ASC 420, “Exit or Disposal Cost
Obligations.” The Company makes assumptions related to the amounts of employee severance benefits and related costs, useful
lives and residual value of long-lived assets, and discount rates. Estimates and assumptions are based on the best information
available at the time the obligation is recognized. These estimates are reviewed and revised as facts and circumstances dictate.
Acquisition related costs incurred to effect a business combination, including finders’ fees, legal, valuation and other
professional or consulting fees, are expensed as incurred. Acquisition related costs also include expenses recognized under earn-out
agreements in connection with acquisitions.
Accounting for Income Taxes
The asset and liability method is used to account for income taxes. Under the asset and liability method, deferred tax assets
and liabilities are recognized for the estimated future tax consequences attributable to temporary differences between the financial
statement carrying amounts of assets and liabilities and their respective tax bases. This method also requires the recognition of
future tax benefits, such as net operating loss carryforwards, to the extent that it is more likely than not that such benefits will be
realized. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the temporary
differences are expected to be recovered or settled. A valuation allowance is established to reduce the deferred tax assets if it is
more likely than not that some or all of the related tax benefits will not be realized in the future. Valuation allowances are reassessed
periodically to determine whether it is more likely than not that the tax benefits will be realized in the future and if any existing
valuation allowance should be released.
The majority of the Company’s business activities are conducted through its subsidiaries outside of Canada. Earnings from
these subsidiaries are generally indefinitely reinvested in the local businesses. Further, local laws and regulations may also restrict
certain subsidiaries from paying dividends to their parents. Consequently, the Company generally does not accrue income taxes for
the repatriation of such earnings in accordance with ASC 740, “Income Taxes.” To the extent that there are excess accumulated
earnings that the Company intends to repatriate from any such subsidiaries, the Company recognizes deferred tax liabilities on such
foreign earnings.
The Company assesses its income tax positions and records tax benefits for all years subject to examination based on the
evaluation of the facts, circumstances, and information available at each reporting date. For those tax positions with a greater than
50 percent likelihood of being realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant
information, the Company records a tax benefit. For those income tax positions that are not likely to be sustained, no tax benefit is
recognized in the consolidated financial statements. The Company recognizes interest and penalties related to uncertain tax
positions as part of the provision for income taxes.
Foreign Currency Contracts
The Company uses foreign currency contracts as a part of its strategy to limit its exposures to fluctuations in foreign currency
exchange rates related to foreign currency denominated monetary assets and liabilities. The time duration of these foreign currency
contracts approximates the underlying foreign currency transaction exposures, generally less than three months. These foreign
currency contracts are not designated as cash flow, fair value or net investment hedges. Changes in the fair value of these foreign
currency contracts are recognized in income before income taxes.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
63
Recent Accounting Pronouncements
The following table provides a brief description of recent Accounting Standards Updates (“ASU”) issued by the Financial
Accounting Standards Board (“FASB”):
Standard
Description
Effective Date
Effect on the Financial Statements or
Other Significant Matters
In October 2023, the FASB
issued ASU 2023-06,
“Disclosure Improvements:
Codification Amendments in
Response to SEC’s Disclosure
Update and Simplification
Initiative.”
ASU 2023-06 clarifies or improves
disclosure and presentation
requirements of a variety of topics,
which allow users to easily compare
entities subject to the SEC’s existing
disclosure requirements with those
entities that were not previously
subject to such requirements and
align the requirements in the FASB
Accounting Standards Codification
with the SEC’s regulations.
The effective date for
each amendment in
ASU 2023-06 will be
the date on which the
SEC’s removal of that
related disclosure
from Regulation S-X
or Regulation S-K
becomes effective,
with early adoption
prohibited.
The Company is currently
evaluating the impact of ASU
2023-06 on its consolidated
financial statement disclosures.
In November 2023, the FASB
issued ASU 2023-07,
“Segment Reporting (Topic
280)-Improvements to
Reportable Segment
Disclosures.”
ASU 2023-07 clarifies or improves
financial reporting by requiring
disclosure of incremental segment
information. The amendments require
disclosure, on an annual and interim
basis for all public entities, significant
segment expenses included in
segment profit or loss, an amount and
description of “other segment items”
included in segment profit or loss,
and an explanation of how reported
segment profit or loss is assessed and
allocated.
The amendments in
ASU 2023-07 are
effective for fiscal
years beginning after
December 15, 2023
and interim periods
within fiscal years
beginning after
December 15, 2024.
Early adoption is
permitted.
The Company adopted ASU 2023-
07 beginning with its consolidated
financial statement disclosures for
the year ended December 31, 2024.
See Note 18 “Segment
Information” for additional
information.
In December 2023, the FASB
issued ASU 2023-09, “Income
Taxes (Topic 740) -
Improvements to Income Tax
Disclosures.”
ASU 2023-09 provides more
transparency about income tax
information through improvements to
income tax disclosures primarily
related to the rate reconciliation and
income taxes paid.
The amendments in
ASU 2023-09 are
effective for annual
periods beginning
after December 15,
2024. Early adoption
is permitted.
The Company is currently
evaluating the impact of ASU
2023-09 on its consolidated
financial statement disclosures.
In November 2024, the FASB
issued ASU 2024-03, “Income
Statement - Reporting
Comprehensive Income -
Expense Disaggregation
Disclosures (Subtopic 220-
40): Disaggregation of
Income Statement Expenses.”
ASU 2024-03 improves financial
reporting by requiring that public
business entities disclose additional
information about specific expense
categories in the notes to financial
statements at both interim and annual
reporting periods.
The amendments in
ASU 2024-03 are
effective for annual
reporting periods
beginning after
December 15, 2026
and interim reporting
periods beginning
after December 15,
2027, with early
adoption permitted.
The Company is currently
evaluating the impact of ASU
2024-03 on its consolidated
financial statement disclosures.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
64
3. Revenue
The Company accounts for its revenue transactions in accordance with ASC 606, “Revenue from Contracts with Customers,”
which requires entities to recognize revenue in a way that depicts the transfer of control over goods or services to customers at an
amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Revenue
recognition for arrangements within the scope of ASC 606 includes the following five steps: (i) identifying the contract(s) with a
customer; (ii) identifying the performance obligations in the contract; (iii) determining the transaction price; (iv) allocating the
transaction price to the performance obligations in the contract; and (v) recognizing revenue when (or as) a performance obligation
is satisfied.
The Company recognizes revenue when control of promised goods or services is transferred to the customer. The transfer of
control generally occurs upon shipment when title and risk of loss pass to the customer. The vast majority of the Company’s
revenue is generated from the sale of distinct products. Revenue is measured as the amount of consideration the Company expects
to receive in exchange for such products, which is generally at contractually stated prices. Sales taxes and value added taxes
collected concurrently with revenue generating activities are excluded from revenue.
Performance Obligations
Substantially all of the Company’s revenue is recognized at a point in time, upon shipment, rather than over time.
At the request of its customers, the Company may perform professional services, generally for the maintenance and repair of
products previously sold to those customers and for engineering services. Professional services are typically short in duration,
mostly less than one month, and aggregate to less than 3% of the Company’s consolidated revenue. Revenue is typically recognized
at a point in time when control transfers to the customer upon completion of professional services. These services generally involve
a single distinct performance obligation. The consideration expected to be received in exchange for such services is normally the
contractually stated amount.
The Company occasionally sells separately priced non-standard/extended warranty services or preventative maintenance plans
with the sale of products. The transfer of control over the service plans is over time. The Company recognizes the related revenue
ratably over the terms of the service plans. The transaction price of a contract is allocated to each performance obligation based on
its relative standalone selling price. Standalone selling prices are generally determined based on the prices charged to customers or
using the expected cost plus a margin.
Shipping and Handling Costs
The Company accounts for shipping and handling activities that occur after the transfer of control over the related goods as
fulfillment activities rather than performance obligations. The shipping and handling fees charged to customers are recognized as
revenue and the related costs are recorded in cost of revenue at the time of transfer of control.
Warranties
The Company generally provides warranties for its products. The standard warranty period is typically 12 months to 36
months. The standard warranty period for product sales is accounted for under the provisions of ASC 450, “Contingencies,” as the
Company has the ability to ascertain the likelihood of the liability and can reasonably estimate the amount of the liability. A
provision for the estimated warranty cost is recorded in cost of revenue at the time revenue is recognized. The Company’s estimate
of costs to service the warranty obligations is based on historical experience and expectations of future conditions. To the extent that
the Company’s experience in warranty claims or costs associated with servicing those claims differ from the original estimates,
revisions to the estimated warranty liability are recorded at that time, with an offsetting adjustment to cost of revenue.
Practical Expedients and Exemptions
The Company expenses incremental direct costs of obtaining a contract when incurred if the expected amortization period is
one year or less. These costs are recorded within selling, general and administrative expenses in the consolidated statement of
operations.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
65
The Company does not adjust the promised amount of consideration for the effects of a financing component because the time
period between the transfer of a promised good to a customer and the customer’s payment for that good is typically one year or less.
The Company does not disclose the value of the remaining performance obligation for contracts with an original expected length of
one year or less.
Contract Liabilities
Contract liabilities consist of deferred revenue and advance payments from customers, including amounts that are refundable.
These contract liabilities are classified as either current or long-term liabilities in the consolidated balance sheet based on the timing
of when the Company expects to recognize the related revenue. As of December 31, 2024 and December 31, 2023, contract
liabilities were $5.9 million and $5.8 million, respectively, and are included in accrued expenses and other current liabilities and
other liabilities in the accompanying consolidated balance sheets. The increase in the contract liability balance during the year ended
December 31, 2024 is primarily due to cash payments received in advance of satisfying performance obligations, partially offset by
$4.3 million of revenue recognized during the year that was included in the contract liability balance at December 31, 2023.
Disaggregated Revenue
See Note 18 for the Company’s disaggregation of revenue by geography and end market. The following table presents
revenues disaggregated by the capabilities of the underlying products and technologies for the years ended December 31, 2024,
2023, and 2022, respectively (in thousands):
Year Ended December 31,
2024
2023
2022
Precision Manufacturing
$
202,303
$
225,750
$
225,853
Robotics and Automation
288,317
273,470
308,237
Automation Enabling Technologies
490,620
499,220
534,090
Precision Medicine
249,872
178,840
144,018
Advanced Surgery
208,753
203,602
182,795
Medical Solutions
458,625
382,442
326,813
Total Revenue
$
949,245
$
881,662
$
860,903
4. Business Combinations
2024 Acquisition
On January 2, 2024, the Company completed the acquisition of Motion Solutions Parent Corp. (“Motion Solutions”), an
Irvine, California-based provider of highly engineered integrated solutions, specializing in proprietary precision motion and
advanced motion control solutions, for a total purchase price of $192.0 million in cash, net of working capital adjustments. The
acquisition was financed with borrowings under the Company’s revolving credit facility. The addition of Motion Solutions
enhances the Company’s product portfolio and further expands its presence in attractive medical and precision medicine spaces.
Motion Solutions is included in the Medical Solutions reportable segment.
Allocation of Purchase Price
The acquisition of Motion Solutions has been accounted for as a business combination. The purchase price is allocated based
upon a valuation of the fair values of assets acquired and liabilities assumed. Assets acquired and liabilities assumed have been
recorded at their estimated fair values as of the acquisition date. The excess of the purchase price over the fair values of the acquired
tangible assets, identifiable intangible assets and assumed liabilities was recorded as goodwill. The fair values of identifiable
intangible assets were based on valuations using an income approach, specifically the multi-period excess earnings method for
customer relationships and the relief-from-royalty method for developed technologies. The process for estimating the fair values of

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
66
identifiable intangible assets requires the use of significant estimates and assumptions, including revenue growth rates, customer
attrition rates, royalty rates, discount rates, technology obsolescence curves, and EBITDA margins.
The final purchase price for Motion Solutions was allocated as follows (in thousands):
Purchase Price
Allocation
Cash
$
776
Accounts receivable
8,515
Inventory
13,940
Property, plant and equipment
3,126
Operating lease assets
8,076
Intangible assets
83,000
Goodwill
106,761
Other assets
1,002
Total assets acquired
225,196
Accounts payable
5,305
Operating lease liabilities
8,514
Deferred tax liabilities
18,171
Other liabilities
1,230
Total liabilities assumed
33,220
Total assets acquired, net of liabilities assumed
191,976
Less: cash acquired
776
Purchase price, net of cash acquired
$
191,200
The estimated purchase price allocation previously disclosed in the Form 10-Q for the period ended March 29, 2024 was
revised during the second, third, and fourth quarter of 2024 as new information was received and analyzed, resulting in an increase
in Inventory of $0.4 million, an increase in Intangible assets of $2.6 million, an increase in Other assets of $0.4 million, an increase
in Deferred tax liabilities of $0.6 million, an increase in Other liabilities of $0.8 million and a decrease in Goodwill of $2.0 million.
The fair value of intangible assets for Motion Solutions is comprised of the following:
Estimated Fair
Amortization
Value
(In thousands)
Period
Developed technologies
$
34,400
7 years
Customer relationships
43,100
13 years
Backlog
5,500
1 year
Total
$
83,000
The purchase price allocation resulted in $83.0 million of identifiable intangible assets and $106.8 million of goodwill. As the
Motion Solutions acquisition was structured as a stock acquisition for income tax purposes, the goodwill is not deductible. The
goodwill recorded represents the anticipated incremental value of future cash flows potentially attributable to: (i) Motion Solution’s
ability to grow the business with existing and new customers, including leveraging the Company’s customer base; (ii) Motion
Solution’s ability to grow the business through new product introductions; and (iii) cost improvements due to the integration of
Motion Solution’s operations into the Company’s existing infrastructure.
The operating results of Motion Solutions were included in the Company’s results of operations beginning January 2, 2024.
Motion Solutions contributed revenues of $82.4 million and an income before income taxes of $0.2 million to the Company’s
operating results for the twelve months ended December 31, 2024. The loss before income taxes from Motion Solutions for the
period from the acquisition date through December 31, 2024 included amortization of inventory fair value adjustments of
$2.8 million and amortization of purchased intangible assets of $13.0 million.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
67
Unaudited Pro Forma Information
The pro forma information for all periods presented below includes the effect of business combination accounting resulting
from the acquisition of Motion Solutions, including amortization of inventory fair value adjustments, amortization of intangible
assets, interest expense on borrowings in connection with the acquisition, and the related tax effects, assuming that the acquisition
had been consummated as of January 1, 2023. The pro forma financial information is presented for comparative purposes only and
is not necessarily indicative of the results of operations that actually would have been achieved if the acquisition had taken place on
January 1, 2023.
Year Ended
December 31,
December 31,
2024
2023
Revenue
$
949,245
$
966,655
Net income
$
66,495
$
58,169
2022 Acquisition
On August 11, 2022, the Company acquired 100% of the outstanding shares of MPH Medical Devices S.R.O. (“MPH”), a
Czech Republic-based manufacturer of medical consumables with plastics specialization in making medical disposable tube set
products, for a total purchase price of €21.8 million ($22.4 million), net of cash acquired. The acquisition was financed with
borrowings under the Company's revolving credit facility and cash available on hand. The addition of MPH has expanded the
Company's capacity and capabilities in the medical disposable tube set products within the Medical Solutions reportable segment.
The acquisition of MPH has been accounted for as a business combination. The purchase price is allocated based upon a
valuation of the fair values of assets acquired and liabilities assumed as of the acquisition date. The fair value of the real property
were based on valuations using an income and cost approach, specifically the direct capitalization method and the replacement value
approaches. These approaches are subject to key assumptions including market rent estimates, capitalization rates, local multipliers
and remaining useful life. The sales comparison approach was not considered due to the limited data available on comparable
properties.
The total purchase price for MPH was allocated as follows (in thousands):
Purchase Price
Allocation
Cash
$
182
Accounts receivable
1,658
Inventories
957
Property, plant and equipment
12,094
Goodwill
9,863
Other assets
163
Total assets acquired
24,917
Accounts payable
562
Deferred tax liabilities
1,124
Other liabilities
664
Total liabilities assumed
2,350
Total assets acquired, net of liabilities assumed
22,567
Less: cash acquired
182
Total purchase price, net of cash acquired
$
22,385
The purchase price allocation resulted in $9.9 million of goodwill. As the MPH acquisition was structured as a stock
acquisition, the goodwill is not deductible for income tax purposes. The goodwill recorded represents the anticipated future benefits
from the expansion of the Company's manufacturing capacity and capabilities for the medical disposal tube set products.
The operating results of MPH were included in the Company’s results of operations beginning on August 12, 2022. MPH
contributed revenues of $5.2 million and a profit before income taxes of $0.4 million for the year ended December 31, 2022.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
68
Acquisition Costs
Acquisition costs are included in restructuring and acquisition related costs in the consolidated statements of operations.
Acquisition-related costs were $1.0 million, zero, and $1.0 million for the years ended December 31, 2024, 2023, and 2022,
respectively, related to the acquisitions that occurred during those years, if any.
5. Accumulated Other Comprehensive Loss
Changes in accumulated other comprehensive loss for the years ended December 31, 2024, 2023, and 2022, respectively,
were as follows (in thousands):
Total Accumulated
Other
Cumulative
Pension
Comprehensive
Translation
Liability
Income (Loss)
Adjustments
Adjustments
Balance at December 31, 2021
$
(12,866)
$
(5,753)
$
(7,113)
Other comprehensive income (loss)
(19,555)
(18,674)
(881)
Amounts reclassified from accumulated other comprehensive loss (1)
412
—
412
Balance at December 31, 2022
(32,009)
(24,427)
(7,582)
Other comprehensive income (loss)
6,951
7,823
(872)
Amounts reclassified from accumulated other comprehensive loss (1)
1,020
—
1,020
Balance at December 31, 2023
(24,038)
(16,604)
(7,434)
Other comprehensive income (loss)
(6,764)
(7,082)
318
Amounts reclassified from accumulated other comprehensive loss (1)
881
—
881
Balance at December 31, 2024
$
(29,921)
$
(23,686)
$
(6,235)
(1)
The amounts reclassified from accumulated other comprehensive loss were included in other income (expense) in the
consolidated statements of operations.
6. Goodwill, Intangible Assets and Impairment Charges
Goodwill
The following table summarizes changes in goodwill during the year ended December 31, 2024 (in thousands):
Amount
Balance at beginning of year
$
484,507
Goodwill from current year acquisitions
106,761
Effect of foreign exchange rate changes
(7,170)
Balance at end of year
$
584,098
Goodwill by reportable segment as of December 31, 2024 was as follows (in thousands):
Reportable Segment
Automation Enabling
Technologies
Medical Solutions
Total
Goodwill
$
439,980
$
295,347
$
735,327
Accumulated impairment of goodwill
(119,507)
(31,722)
(151,229)
Total
$
320,473
$
263,625
$
584,098
Goodwill by reportable segment as of December 31, 2023 was as follows (in thousands):
Reportable Segment
Automation Enabling
Technologies
Medical Solutions
Total
Goodwill
$
433,525
$
202,211
$
635,736
Accumulated impairment of goodwill
(119,507)
(31,722)
(151,229)
Total
$
314,018
$
170,489
$
484,507

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
69
The segment change discussed in Note 2, impacted the composition of the Company's reporting units, which resulted in a
reallocation of goodwill between the Automation Enabling Technologies and Medical Solutions segments. The Company allocated
$9.4 million and $22.7 million to the Automation Enabling Technologies segment and the Medical Solutions segment, respectively,
based on the estimated relative fair values of the reporting units. The Company also assessed goodwill for impairment for the
reporting units both before and after the reallocation and determined that there was no impairment.
Intangible Assets
Intangible assets as of December 31, 2024 and 2023, respectively, are summarized as follows (dollar amounts in thousands):
December 31, 2024
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Amount
Weighted Average
Remaining Life
(Years)
Amortizable intangible assets:
Patents and developed technologies
$
218,867
$
(159,041)
$
59,826
7.6
Customer relationships
265,156
(158,938)
106,218
13.2
Trademarks and trade names
23,367
(16,594)
6,773
9.2
Amortizable intangible assets
507,390
(334,573)
172,817
11.1
Non-amortizable intangible assets:
Trade names
13,027
—
13,027
Total
$
520,417
$
(334,573)
$
185,844
December 31, 2023
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Amount
Weighted Average
Remaining Life
(Years)
Amortizable intangible assets:
Patents and developed technologies
$
187,092
$
(146,342)
$
40,750
9.6
Customer relationships
225,183
(142,478)
82,705
14.4
Trademarks and trade names
23,628
(15,088)
8,540
9.5
Amortizable intangible assets
435,903
(303,908)
131,995
12.6
Non-amortizable intangible assets:
Trade names
13,027
—
13,027
Total
$
448,930
$
(303,908)
$
145,022
All definite-lived intangible assets are amortized either on a straight-line basis or an economic benefit basis over their
remaining estimated useful life. Amortization expense for patents and developed technologies is included in cost of revenue in the
accompanying consolidated statements of operations. Amortization expense for customer relationships and definite-lived
trademarks, trade names and other intangibles is included in operating expenses in the accompanying consolidated statements of
operations. Amortization expense for the periods presented was as follows (in thousands):
Year Ended December 31,
2024
2023
2022
Amortization expense – cost of revenue
$
14,773
$
12,150
$
13,270
Amortization expense – operating expenses
25,794
20,445
26,338
Total amortization expense
$
40,567
$
32,595
$
39,608

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
70
Estimated future amortization expense for each of the five succeeding years and thereafter is as follows (in thousands):
Year Ending December 31,
Cost of
Revenue
Operating
Expenses
Total
2025
$
14,222
$
22,173
$
36,395
2026
13,384
19,880
33,264
2027
10,568
15,768
26,336
2028
8,837
12,697
21,534
2029
6,064
9,148
15,212
Thereafter
6,751
33,325
40,076
Total
$
59,826
$
112,991
$
172,817
Impairment Charges
The Company did not have any goodwill or indefinite-lived intangible asset impairment charges during the years ended
December 31, 2024, 2023, or 2022.
7. Fair Value Measurements
ASC 820, “Fair Value Measurement,” establishes a fair value hierarchy based on three levels of inputs, of which the first two
are considered observable and the third is considered unobservable:
Level 1: Quoted prices for identical assets or liabilities in active markets which the Company can access
Level 2: Observable inputs other than those described in Level 1
Level 3: Unobservable inputs
Current Assets and Liabilities
The Company’s cash equivalents are highly liquid investments with original maturities of three months or less, which
represent assets the Company measures at fair value on a recurring basis. The Company determines the fair value of cash
equivalents using a market approach based on quoted prices in active markets. The fair values of cash equivalents, accounts
receivable, income taxes receivable, accounts payable, income taxes payable and accrued expenses and other current liabilities
approximate their carrying values because of their short-term nature.
Foreign Currency Contracts
The Company addresses market risks from changes in foreign currency exchange rates through a risk management program
that includes the use of derivative financial instruments to mitigate certain balance sheet foreign currency transaction exposures.
The Company uses foreign currency forward contracts as a part of its strategy to manage exposures related to foreign currency
denominated monetary assets and liabilities.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
71
The following table summarizes the fair values of the Company’s assets and liabilities measured at fair value on a recurring
basis as of December 31, 2024 (in thousands):
Fair Value
Quoted Price in
Active Market for
Identical Assets
(Level 1)
Significant Other
Observable
Inputs
(Level 2)
Significant Other
Unobservable
Inputs
(Level 3)
Assets
Prepaid expenses and other current assets:
Foreign currency forward contracts
$
1,226
$
—
$
1,226
$
—
$
1,226
$
—
$
1,226
$
—
Liabilities
Accrued expenses and other current liabilities:
Contingent considerations - Current
$
57
$
—
$
—
$
57
Foreign currency forward contracts
1,401
—
1,401
—
$
1,458
$
—
$
1,401
$
57
The following table summarizes the fair values of the Company’s assets and liabilities measured at fair value on a recurring
basis as of December 31, 2023 (in thousands):
Fair Value
Quoted Price in
Active Market for
Identical Assets
(Level 1)
Significant Other
Observable
Inputs
(Level 2)
Significant Other
Unobservable
Inputs
(Level 3)
Assets
Cash equivalents
$
1,392
$
1,392
$
—
$
—
Prepaid expenses and other current assets:
Foreign currency forward contracts
379
—
379
—
$
1,771
$
1,392
$
379
$
—
Liabilities
Accrued expenses and other current liabilities:
Contingent considerations - Current
$
48
$
—
$
—
$
48
Foreign currency forward contracts
312
—
312
—
Other liabilities:
Contingent considerations - Long-term
311
—
—
311
$
671
$
—
$
312
$
359
During the years ended December 31, 2024 and 2023, there were no transfers between fair value levels.
See Note 11 for a discussion of the estimated fair value of the Company’s outstanding debt and Note 14 for a discussion of
the estimated fair value of the Company’s pension plan assets.
8. Foreign Currency Contracts
The Company addresses market risks from changes in foreign currency exchange rates through a risk management program
that includes the use of derivative financial instruments to mitigate certain foreign currency transaction exposures from future
settlement of non-functional currency monetary assets and liabilities as of the end of a period. The Company does not enter into
derivative transactions for speculative purposes. Gains and losses on derivative financial instruments substantially offset losses and
gains on the underlying hedged exposures. Furthermore, the Company manages its exposure to counterparty risks on derivative
instruments by entering into contracts with a diversified group of major financial institutions and by actively monitoring outstanding
positions.
As of December 31, 2024, the notional amount and fair value of the Company’s foreign currency forward contracts was
$187.4 million and a net loss of $0.2 million, respectively. As of December 31, 2023, the notional amount and fair value of the
Company’s foreign currency forward contracts was $172.3 million and a net gain of $0.1 million, respectively.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
72
For the years ended December 31, 2024, 2023 and 2022, the Company recognized aggregate net gain of $4.9 million, net gain
of $2.5 million, and net loss of $(2.4) million, respectively, from the settlement of foreign currency forward contracts, which were
included in foreign exchange transaction gains (losses) in the consolidated statements of operations.
9. Earnings per Common Share
Basic earnings per common share is computed by dividing net income by the weighted average number of common shares
outstanding during the year. Fully vested restricted stock units and deferred stock units granted to members of the Company’s Board
of Directors are included in the calculation of weighted average number of common shares outstanding.
For diluted earnings per common share, the denominator includes the dilutive effect of outstanding common share
equivalents. The dilutive effects of outstanding common share equivalents, including outstanding service-based restricted stock
units, stock options and performance-based restricted stock units, are determined using the treasury stock method. Performance-
based restricted stock units are considered contingently issuable shares, the vesting of which may be based on achievement of
specified company financial performance metrics (“attainment-based PSUs”), certain market conditions (“market-based PSUs”) or a
hybrid of company financial performance metrics and market conditions (“hybrid PSUs”). The dilutive effects of market-based
PSUs are included in the weighted average common share calculation based on the number of shares, if any, that would be issuable
as of the end of the reporting period, assuming the end of the reporting period is also the end of the performance period. The dilutive
effects of attainment-based and hybrid PSUs are included in the weighted average common share calculation based on the
cumulative achievement against the performance targets only when the performance targets have been achieved as of the end of the
reporting period.
The following table sets forth the computation of basic and diluted earnings per common share (in thousands, except per share
amounts):
Year Ended December 31,
2024
2023
2022
Numerators:
Net income
$
64,087
$
72,878
$
74,051
Denominators:
Weighted average common shares outstanding— basic
35,950
35,844
35,652
Dilutive potential common shares
174
187
257
Weighted average common shares outstanding— diluted
36,124
36,031
35,909
Antidilutive potential common shares excluded from above
128
99
91
Earnings per Common Share:
Basic
$
1.78
$
2.03
$
2.08
Diluted
$
1.77
$
2.02
$
2.06
For the years ended December 31, 2024 and 2023, 150 thousand shares and 104 thousand shares, respectively, of attainment-
based PSUs and hybrid PSUs were excluded from the calculation of the denominator because they were considered contingently
issuable shares and the related performance targets had not been achieved as of December 31, 2024 and December 31, 2023.
For the year ended December 31, 2022, 99 thousand shares of attainment-based PSUs were excluded from the calculation of
the denominator because they were considered contingently issuable shares and the related performance targets had not been
achieved as of December 31, 2022.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
73
10. Supplementary Balance Sheet Information
The following tables provide the details of selected balance sheet items as of the dates indicated (in thousands):
Inventories
December 31,
2024
2023
Raw materials
$
92,198
$
104,643
Work-in-process
24,719
21,010
Finished goods
27,327
23,311
Demo and consigned inventory
362
407
Total inventories
$
144,606
$
149,371
Property, Plant and Equipment, Net
December 31,
2024
2023
Cost:
Land, buildings and improvements
$
99,217
$
95,020
Machinery and equipment
125,694
117,487
Total cost
224,911
212,507
Accumulated depreciation
(111,776)
(103,058)
Property, plant and equipment, net
$
113,135
$
109,449
The following table summarizes depreciation expense on property, plant and equipment, including demo units and assets
under finance leases (in thousands):
Year Ended December 31,
2024
2023
2022
Depreciation expense
$
14,996
$
14,017
$
13,550
Accrued Expenses and Other Current Liabilities
The following table summarizes accrued expenses and other current liabilities as of the dates indicated (in thousands):
December 31,
2024
2023
Accrued compensation and benefits
$
28,361
$
32,703
Finance lease obligations
759
718
Contract liabilities, current portion
5,715
5,553
Accrued warranty
4,805
5,292
Other
20,691
16,790
Total
$
60,331
$
61,056

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
74
Accrued Warranty
The following table summarizes changes in accrued warranty for the periods indicated (in thousands):
Year Ended December 31,
2024
2023
2022
Balance at beginning of year
$
5,292
$
5,127
$
4,783
Provision charged to cost of revenue
1,140
2,445
3,071
Warranty liabilities acquired from acquisitions
76
—
—
Use of provision
(1,680)
(2,338)
(2,615)
Foreign currency exchange rate changes
(23)
58
(112)
Balance at end of year
$
4,805
$
5,292
$
5,127
Other Long-term Liabilities
The following table summarizes other long-term liabilities as of the dates indicated (in thousands):
December 31,
2024
2023
Finance lease obligations
$
3,175
$
3,934
Accrued contingent considerations and earn-outs
—
311
Other
1,316
1,687
Total
$
4,491
$
5,932
11. Debt
Debt consisted of the following (in thousands):
December 31,
2024
2023
Senior Credit Facilities – term loan
$
4,710
$
4,994
Less: unamortized debt issuance costs
(19)
(26)
Total current portion of long-term debt
4,691
4,968
Senior Credit Facilities – term loan
65,698
74,655
Senior Credit Facilities – revolving credit facility
348,751
278,404
Less: unamortized debt issuance costs
(2,500)
(3,655)
Total long-term debt
411,949
349,404
Total Senior Credit Facilities
$
416,640
$
354,372
Senior Credit Facilities
On December 31, 2019, the Company entered into an amended and restated credit agreement (the “Third Amended and
Restated Credit Agreement”) with existing lenders for an aggregate credit facility of $450.0 million, consisting of a $100.0 million
U.S. dollar equivalent euro-denominated (approximately €90.2 million) 5-year term loan facility and a $350.0 million 5-year
revolving credit facility (collectively, the “Senior Credit Facilities”). The Third Amended and Restated Credit Agreement had an
original maturity date of December 31, 2024.
On March 27, 2020, the Company entered into an amendment (the “First Amendment”) to the Third Amended and Restated
Credit Agreement and exercised a portion of the uncommitted accordion option. The First Amendment increased the revolving
credit facility commitment by $145.0 million, from $350.0 million to $495.0 million, and reset the uncommitted accordion option to
$200.0 million for potential future expansion.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
75
On October 5, 2021, the Company entered into an amendment (the “Fourth Amendment”) to the Third Amended and Restated
Credit Agreement to exercise the accordion option. The Fourth Amendment increased the revolving credit facility commitment by
$200.0 million, from $495.0 million to $695.0 million, and reset the uncommitted accordion option to $200.0 million for potential
future expansion.
On March 10, 2022, the Company entered into an amendment (the “Fifth Amendment”) to the Third Amended and Restated
Credit Agreement to extend the maturity date from December 31, 2024 to March 10, 2027, update the pricing grid, replace LIBOR
with SOFR as the reference rate for U.S. dollar borrowings, and increase the uncommitted accordion option from $200.0 million to
$350.0 million.
The borrowings outstanding under the Senior Credit Facilities bear interest at rates based on (a) the Base Rate, as defined in
the Third Amended and Restated Credit Agreement, plus a margin ranging between 0.00% to 0.75% per annum, determined by
reference to the Company’s consolidated leverage ratio, or (b) the Term SOFR Screen Rate, the Alternative Currency Daily Rate or
the Alternative Currency Term Rate, as defined in the Third Amended and Restated Credit Agreement, plus a margin ranging
between 0.75% and 1.75% per annum, determined by reference to the Company’s consolidated leverage ratio. In addition, the
Company is obligated to pay a commitment fee on the unused portion of the revolving credit facility, ranging between 0.20% and
0.30% per annum, determined by reference to the Company’s consolidated leverage ratio.
The Third Amended and Restated Credit Agreement contains various customary representations, warranties and covenants
applicable to the Company and its subsidiaries, including, among others: (i) limitations on restricted payments, including dividend
payments and stock repurchases, provided that the Company and its subsidiaries may repurchase their equity interests so long as,
immediately after giving effect to the repurchase, the Company’s consolidated leverage ratio is no more than 3.25:1.00, with a step
up to 3.75:1.00 for four consecutive quarters following an acquisition with an aggregate consideration greater than or equal to
$50.0 million, and the satisfaction of certain other customary conditions; (ii) limitations on fundamental changes involving the
Company and its subsidiaries; (iii) limitations on the disposition of assets; and (iv) limitations on indebtedness, investments, and
liens. The Third Amended and Restated Credit Agreement also requires the Company to satisfy certain financial covenants, such as
maintaining a minimum consolidated fixed charge coverage ratio of 1.50:1.00 and a maximum consolidated leverage ratio of
3.50:1.00. The maximum consolidated leverage ratio will increase to 4.00:1.00 for four consecutive quarters following an
acquisition with an aggregate consideration greater than or equal to $50.0 million.
The outstanding principal balance under the term loan facility is payable in quarterly installments of €1.1 million that began in
March 2020, with the remaining balance due upon maturity. The Company may make additional principal payments at any time,
which will reduce the next quarterly installment payment due. Borrowings under the revolving credit facility may be repaid at any
time through March 2027.
As of December 31, 2024, the outstanding principal under the Company’s term loan facility is scheduled to be repaid as
follows (in thousands):
Principal Amount
2025
$
4,710
2026
4,710
2027
60,988
Total debt repayments
$
70,408
The Company may be required to prepay outstanding loans under the Third Amended and Restated Credit Agreement with
the net proceeds from certain asset dispositions and incurrence of certain debt. At the election of the Company, and so long as no
default shall have occurred, the Company may reinvest all, or any portion, of the net proceeds from such asset dispositions or
incurrence of debt within a year.
As of December 31, 2024, the Company had $346.2 million additional borrowing capacity available under the revolving
credit facility. Excluding commitment fees under the revolving credit facility, the weighted average interest rate for the Senior
Credit Facilities was approximately 5.62% as of December 31, 2024. The commitment fee rate for the unused commitments under
the revolving credit facility was approximately 0.28% as of December 31, 2024.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
76
Guarantees
The Senior Credit Facilities are guaranteed by Novanta Inc., Novanta Corporation, NDS Surgical Imaging LLC, Novanta
Medical Technologies Corp., W.O.M. World of Medicine USA, Inc., Novanta Europe GmbH, Novanta U.K. Investments Holding
Limited, Novanta Technologies U.K. Limited, ATI Industrial Automation, Inc., ATI Industrial Mexico, LLC, and Motion Solutions
Parent Corp. (collectively, “Guarantors”). Each Guarantor, jointly and severally, unconditionally guarantees the due and punctual
payment of the principal, interest and fees under the Senior Credit Facilities, when due and payable, whether at maturity, by
required prepayment, by acceleration or otherwise. In addition, Guarantors guarantee the due and punctual payment, fees and
interest on the overdue principal of the Senior Credit Facilities and the due and punctual performance of all obligations of the
Company in accordance with the terms of the Third Amended and Restated Credit Agreement. Furthermore, each Guarantor, jointly
and severally, unconditionally guarantees that in the event of any extension, renewal, amendment, refinancing or modification of
any of the Senior Credit Facilities, amounts due will be promptly paid in full when due in accordance with the terms of the
extension or renewal, at stated maturity, by acceleration or otherwise.
The obligations of each Guarantor are limited to the maximum amount, after giving effect to all other contingent and fixed
liabilities or any collections from, or payments made by or on behalf of, any other Guarantor. Each Guarantor that makes a payment
or distribution under a Guarantee is entitled to a contribution from each other Guarantor of its pro rata share based on the adjusted
net assets of each Guarantor. If at any time any payment of any of the obligations of the Guarantors is rescinded or must otherwise
be returned upon the insolvency, bankruptcy or reorganization of the Company, a Guarantor or otherwise, the Guarantees will
continue to be effective or be reinstated, as the case may be, as though such payment had not been made.
Each Guarantor may be released from its obligations under its respective Guarantee and its obligations under the Third
Amended and Restated Credit Agreement upon the occurrence of certain events, including, but not limited to: (i) the Guarantor
ceasing to be a subsidiary; or (ii) payment in full of the principal and accrued and unpaid interest on the Senior Credit Facilities and
all other obligations.
The maximum potential amount of future payments that the Guarantors could be required to make under the Guarantee is the
principal amount of the Senior Credit Facilities plus all accrued and unpaid interest thereon. However, as of December 31, 2024, the
Guarantors were not expected to be required to perform under the Guarantee.
Liens
The Company’s obligations under the Senior Credit Facilities are secured, on a senior basis, by a lien on substantially all of
the assets of Novanta Inc. The Third Amended and Restated Credit Agreement also contains customary events of default.
Deferred Financing Costs
The Company allocated the deferred financing costs between the term loan and the revolving credit facility based on the
maximum borrowing capacity and are amortized on a straight-line basis over the term of the Senior Credit Facilities. Non-cash
interest expense related to the amortization of the deferred financing costs was $1.2 million, $1.2 million and $1.2 million for the
years ended December 31, 2024, December 31, 2023 and December 31, 2022, respectively. Unamortized deferred financing costs
are presented as a reduction to the debt balances on the consolidated balance sheets.
Fair Value of Debt
As of December 31, 2024 and December 31, 2023, the outstanding balance of the Company’s debt approximated its fair value
based on current rates available to the Company for debt of the same maturities. The fair value of the Company’s debt is classified
as Level 2 under the fair value hierarchy.
12. Leases
Most leases held by the Company expire between 2025 and 2036. In the U.K., where longer lease terms are more common,
the Company has a land lease that extends through 2078. Certain leases include terms such as one or more options to renew, with
renewal terms that can extend the lease term from one to 10 years, and options to terminate the leases within one year. The exercise
of lease renewal or termination option is at the Company’s sole discretion; therefore, the majority of renewals to extend the lease
terms are not included in the Company’s right-of-use assets and operating lease liabilities as they are not reasonably certain of being

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
77
exercised. The Company regularly evaluates the renewal options and includes the renewal periods in the lease term when they are
reasonably certain of being exercised. The depreciable life of right-of-use assets and leasehold improvements is limited to the
expected lease terms.
The following table summarizes the components of lease costs included in the statements of operations for the periods
indicated (in thousands):
Year Ended December 31,
2024
2023
2022
Operating lease cost
$
12,109
$
10,475
$
10,387
Finance lease cost
Amortization of right-of-use assets
602
602
602
Interest on lease liabilities
236
274
308
Variable lease cost
1,192
1,007
1,145
Total lease cost
$
14,139
$
12,358
$
12,442
The following table provides the details of balance sheet information related to leases as of the dates indicated (in thousands,
except lease term and discount rate):
December 31,
2024
2023
Operating leases:
Operating lease right-of-use assets
$
42,908
$
38,302
Current portion of operating lease liabilities
$
9,879
$
8,189
Operating lease liabilities
40,548
37,345
Total operating lease liabilities
$
50,427
$
45,534
Finance leases:
Property, plant and equipment, gross
$
9,582
$
9,582
Accumulated depreciation
(6,874)
(6,272)
Finance lease assets included in property, plant and
equipment, net
$
2,708
$
3,310
Accrued expenses and other current liabilities
$
759
$
718
Other liabilities
3,175
3,934
Total finance lease liabilities
$
3,934
$
4,652
Weighted-average remaining lease term (in years):
Operating leases
7.4
7.6
Finance leases
4.5
5.5
Weighted-average discount rate:
Operating leases
4.82%
4.84%
Finance leases
5.54%
5.54%

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
78
The following table provides the details of cash flow information related to leases for the periods indicated (in thousands):
Year Ended December 31,
2024
2023
2022
Cash paid for amounts included in lease liabilities:
Operating cash flows from finance leases
$
236
$
274
$
308
Operating cash flows from operating leases
$
11,169
$
7,826
$
7,876
Financing cash flows from finance leases
$
718
$
657
$
599
Supplemental non-cash information:
Right-of-use assets obtained in exchange for new operating lease
liabilities(1)
$
14,237
$
4,046
$
4,757
Right-of-use assets obtained in exchange for new finance lease liabilities
$
-
$
-
$
-
(1)The amount for the twelve months ended December 31, 2024 includes $8.1 million of right-of-use assets acquired as part of
the Motion Solutions acquisition.
Future minimum lease payments under operating and finance leases expiring subsequent to December 31, 2024, including
operating leases associated with facilities that have been vacated as a result of the Company’s restructuring actions, are summarized
as follows (in thousands):
Year Ending December 31,
Operating Leases
Finance Leases
2025
$
11,581
$
954
2026
10,445
979
2027
8,880
1,003
2028
6,084
1,003
2029
5,297
502
Thereafter
19,037
—
Total minimum lease payments
61,324
4,441
Less: interest
(10,897)
(507)
Present value of lease liabilities
$
50,427
$
3,934
13. Stockholders’ Equity and Share-Based Compensation
Preferred Shares
In May 2021, the Company’s shareholders approved a special resolution to amend the Company’s articles to authorize up to
7.0 million preferred shares for future issuance. The Company’s Board of Directors is authorized to designate and issue one or more
series of preferred shares, fix the rights, preferences and designation, as deemed necessary or advisable, relating to the preferred
shares, provided that no shares of any series may be entitled to more than one vote per share. As of December 31, 2024, no
preferred shares had been issued and outstanding.
Common Shares
The Company has an unlimited number of no-par value common shares authorized for issuance. Holders of common shares
are entitled to one vote per share. Holders of common shares are entitled to receive dividends, if and when declared by the Board of
Directors, and to share ratably in the Company’s assets legally available for distribution to shareholders in the event of liquidation.
Holders of common shares have no redemption or conversion rights.
Common Share Repurchases
The Company’s Board of Directors may approve share repurchase plans from time to time. Under these repurchase plans,
shares may be repurchased at the Company’s discretion based on ongoing assessment of the capital needs of the business, market
prices of the Company’s common shares, and general market conditions. Shares may also be repurchased through an accelerated
share purchase agreement on the open market or in privately negotiated transactions in accordance with applicable federal securities
laws. Repurchases may be made under certain SEC regulations, which would permit common shares to be repurchased when the

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
79
Company would otherwise be prohibited from doing so under insider trading laws. While the share repurchase plans are generally
intended to offset dilution from equity awards granted to the Company’s employees and directors, the plans do not obligate the
Company to acquire any particular amount of common shares. No time limit is typically set for the completion of the share
repurchase plans, and the plans may be suspended or discontinued at any time. The Company expects to fund share repurchases
through cash on hand and cash generated from operations.
In October 2018, the Company’s Board of Directors approved a share repurchase plan (the “2018 Repurchase Plan”)
authorizing the repurchase of $25.0 million worth of common shares. During 2022, the Company completed the 2018 Repurchase
Plan and repurchased 80 thousand shares for an aggregate purchase price of $9.5 million at an average price of $118.97 per share.
From the inception of the 2018 Repurchase Plan, the Company repurchased a cumulative total of 264 thousand shares for an
aggregate purchase price of $25.0 million at an average price of $94.57 per share.
In February 2020, the Company’s Board of Directors approved a new share repurchase plan (the “2020 Repurchase Plan”)
authorizing the repurchase of an additional $50.0 million worth of common shares. During 2022, the Company repurchased 4
thousand shares for an aggregate purchase price of $0.5 million at an average price of $116.95 per share under the 2020 Repurchase
Plan. No shares were repurchased during the years ended December 31, 2024 and 2023. As of December 31, 2024, the Company
had $49.5 million available for future share repurchases under the 2020 Repurchase Plan.
Amended and Restated 2010 Incentive Plan
In November 2010, the Company’s shareholders approved the 2010 Incentive Award Plan under which the Company may
grant share-based compensation awards to employees, consultants and directors. In May 2021, the Company’s shareholders
approved an amended and restated 2010 Incentive Award Plan (as amended, the “Amended and Restated 2010 Incentive Plan”).
The maximum number of shares which can be issued pursuant to the Amended and Restated 2010 Incentive Plan is 6,148,613,
subject to adjustment as set forth in the Amended and Restated 2010 Incentive Plan. The Amended and Restated 2010 Incentive
Plan provides for the grant of incentive stock options, non-qualified stock options, restricted stock, restricted stock units, stock
appreciation rights, deferred stock, deferred stock units, dividend equivalents, performance awards and stock payments (collectively
referred to as “Awards”). The Amended and Restated 2010 Incentive Plan provides for specific limits on the number of shares with
respect to Awards that may be granted to any one person during any calendar year and the amount of cash that can be paid with
respect to Awards to any one person during any calendar year. The Amended and Restated 2010 Incentive Plan will expire and no
further Awards may be granted after May 13, 2031. As of December 31, 2024, there were 1,678,372 shares available for future
Awards under the Amended and Restated 2010 Incentive Plan.
Shares subject to Awards that have expired, forfeited or settled in cash, or repurchased by the Company at the same price paid
by the awardee may be added back to the number of shares available for grant under the Amended and Restated 2010 Incentive Plan
and may be granted as new Awards. Notwithstanding the foregoing, the following shares will not be added back to the number of
shares available for grant: (a) shares that are used to pay the exercise price for an option, (b) shares tendered or withheld to pay
taxes with respect to any Award (other than options and stock appreciation rights) to the extent they exceed the number of shares
with a fair market value equal to the tax liability based on minimum withholding rates, (c) shares tendered or withheld to pay taxes
with respect to options and stock appreciation rights, (d) shares subject to a stock appreciation right that are not issued in connection
with the stock settlement of the stock appreciation right on exercise thereof, and (e) shares purchased on the open market with the
cash proceeds from the exercise of options. Shares issued to satisfy Awards under the Amended and Restated 2010 Incentive Plan
may be previously authorized but unissued shares, treasury shares or shares repurchased on the open market.
Share-Based Compensation Expense
The table below summarizes share-based compensation expense recorded in operating income for the periods indicated (in
thousands):
Year Ended December 31,
2024
2023
2022
Selling, general and administrative
$
19,885
$
21,963
$
18,182
Research and development and engineering
2,346
2,031
2,414
Cost of revenue
1,076
1,594
2,512
Total share-based compensation expense
$
23,307
$
25,588
$
23,108

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
80
The expense recorded during each of the three years ended December 31, 2024, December 31, 2023 and December 31, 2022
included $1.6 million, $1.2 million and $1.1 million, respectively, related to restricted stock units (“RSUs”) and deferred stock units
(“DSUs”) granted to the members of the Company’s Board of Directors.
As of December 31, 2024, the Company’s outstanding equity awards for which compensation expense will be recognized in
the future consisted of time-based RSUs, performance stock units (“PSUs”) and stock options granted under the Amended and
Restated 2010 Incentive Plan. The Company expects to record an aggregate share-based compensation expense of $30.8 million, net
of estimated forfeitures, over a weighted average period of 1.71 years subsequent to December 31, 2024, for all outstanding Awards
as of December 31, 2024.
Restricted Stock Units and Deferred Stock Units
The Company’s RSUs have generally been issued to employees and the Company's Board of Directors with vesting periods
ranging from zero to five years and vest based solely on service conditions. Accordingly, the Company recognizes compensation
expense on a straight-line basis over the requisite service period. The Company reduces the compensation expense by an estimated
forfeiture rate which is based on anticipated forfeitures and actual experience.
DSUs are granted to the members of the Company’s Board of Directors. The compensation expense associated with the DSUs
is recognized in full on the respective date of grant, as DSUs are fully vested and non-forfeitable upon grant. Outstanding DSUs are
converted into common shares upon Board members' resignation or retirement from the Board. There were 40 thousand and 41
thousand DSUs outstanding as of December 31, 2024 and December 31, 2023, respectively, which were included in the calculation
of weighted average basic shares outstanding for the respective period.
The table below summarizes activities during the year ended December 31, 2024 relating to restricted and deferred stock units
issued and outstanding under the Amended and Restated 2010 Incentive Plan:
Restricted and
Deferred
Stock Units
(In thousands)
Weighted
Average Grant
Date Fair Value
Weighted Average
Remaining Vesting
Period (In years)
Aggregate
Intrinsic
Value (1)
(In thousands)
Unvested at December 31, 2023
206
$
143.97
Granted
118
$
161.46
Vested
(107)
$
141.88
Forfeited
(19)
$
155.68
Unvested at December 31, 2024
198
$
154.43
1.11 years
$
30,298
Expected to vest as of December 31, 2024
181
$
153.94
1.11 years
$
27,697
(1)
The aggregate intrinsic value is calculated based on the fair value of $152.77 per common share as of
December 31, 2024 due to the fact that the restricted and deferred stock units carry a $0 purchase price.
The total fair value of restricted stock units and deferred stock units that vested in 2024, based on the market price of the
underlying shares as of the date of vesting, was $17.1 million.
Performance Stock Units
The Company typically grants PSUs that are based on the Company’s financial performance metrics, market conditions, or a
hybrid of company financial performance metrics and market conditions. These PSUs generally cliff vest on the first day following
the end of the specified performance period.
The number of common shares to be issued upon settlement following vesting of attainment-based PSUs is determined based
on the Company’s financial performance metrics over the specified performance period against the targets established by the
Company’s Board of Directors at the time of grant and will be in the range of zero to 200% of the target number of shares. The
Company recognizes the related compensation expense ratably over the performance period based on the number of shares that are
deemed probable of vesting at the end of the specified performance period. This probability assessment is performed quarterly and
the cumulative effect of a change in the estimated compensation expense, if any, is recognized in the consolidated statement of
operations in the period in which such determination is made.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
81
The number of common shares to be issued upon settlement following vesting of market-based PSUs is determined based on
the relative market performance of the Company’s common shares compared to the Russell 2000 Index over the specified
performance period using a payout formula established by the Company’s Board of Directors at the time of grant and will be in the
range of zero to 200% of the target number of shares. The Company recognizes the related compensation expense based on the fair
value of the market-based PSUs, determined using the Monte-Carlo valuation method as of the grant date, on a straight-line basis
from the grant date to the end of the specified performance period. Compensation expense on market-based PSUs will not be
affected by the number of shares that will ultimately vest at the end of the specified performance period.
The number of common shares to be issued upon settlement following vesting of PSU awards that are based on the
achievement of a hybrid of company financial performance metrics and market conditions (“Hybrid PSUs”) is determined based on
the Company's financial performance metrics achieved over the specified performance period against the targets established by the
Company's Board of Directors at the time of grant and a market-based multiplier based on the percentile ranking of the relative
market performance of the Company’s common shares compared to the Russell 2000 Index companies. The payout will be in the
range of zero to 260% of the target number of shares. The Company determines the fair value of these Hybrid PSUs using the
Monte-Carlo valuation method as of the grant date. The Company recognizes compensation expense associated with the Hybrid
PSUs ratably over the performance period based on the fair value of the PSUs as of the grant date and the number of shares that are
deemed probable of vesting based on the estimated achievement of the pertinent company financial performance metrics at the end
of the specified performance period. The probability assessment is performed quarterly and the cumulative effect of a change in the
estimated compensation expense, if any, is recognized in the consolidated statement of operations in the period in which such
determination is made.
The table below summarizes activities during the year ended December 31, 2024 relating to performance-based restricted
stock units issued and outstanding under the Company’s Amended and Restated 2010 Incentive Plan:
Performance
Stock Units (2)
(In thousands)
Weighted
Average Grant
Date Fair Value
Weighted Average
Remaining Vesting
Period (In years)
Aggregate
Intrinsic
Value (3)
(In thousands)
Unvested at December 31, 2023
205
$
160.24
Granted
80
$
177.06
Performance adjustments(1)
16
$
166.64
Vested
(49)
$
166.58
Forfeited
(25)
$
168.78
Unvested at December 31, 2024
227
$
165.13
1.15 years
$
34,667
Expected to vest as of December 31, 2024
190
$
163.87
1.15 years
$
29,051
(1)
The amount shown represents performance adjustments related to the performance-based awards vested during
the year ended December 31, 2024.
(2)
The unvested PSUs are shown in this table at target payout. The number of shares vested reflects the number of
shares earned and issued during the year. As of December 31, 2024, the maximum number of PSUs available to
be earned was approximately 443 thousand.
(3)
The aggregate intrinsic value is calculated based on the fair value of $152.77 per common share as of
December 31, 2024 due to the fact that the performance stock units carry a $0 purchase price.
The total fair value of PSUs that vested during the year ended December 31, 2024, based on the market price of the
underlying shares on the date of vesting, was $8.0 million.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
82
The grant-date fair value of the hybrid PSUs granted during the year ended December 31, 2024 was estimated using the
Monte-Carlo valuation model with the following assumptions:
Year Ended
December 31, 2024
Grant-date stock price
$
157.48
Expected volatility
36.90%
Risk-free interest rate
4.35%
Expected annual dividend yield
—
Weighted average fair value
$
180.98
Stock Options
In February 2024, the Company granted 53 thousand nonqualified stock options to certain members of the executive
management team to purchase common shares of the Company at an exercise price equal to the closing market price on the date of
grant. The stock options vest ratably over three years on the anniversary of the date of grant and expire on the seventh anniversary
of the date of grant. The Company estimates the fair value of stock options using the Black-Scholes valuation model. The Company
recognizes compensation expense related to the stock options on a straight-line basis over the vesting period in the consolidated
statement of operations.
The following table shows stock options that were outstanding and exercisable as of December 31, 2024 and the related
weighted average exercise price, weighted average remaining contractual term and aggregate intrinsic value:
Stock Options
(In thousands)
Weighted
Average Exercise
Price
Weighted
Average Remaining
Contractual Term
(years)
Aggregate
Intrinsic Value (1)
(In thousands)
Outstanding as of December 31, 2023
132
$
102.86
Granted
53
$
157.48
Exercised
(31)
$
14.13
Forfeited or expired
(5)
$
156.61
Outstanding as of December 31, 2024
149
$
139.17
4.63 years$
2,449
Exercisable as of December 31, 2024
59
$
116.07
3.22 years$
2,247
Expected to vest as of December 31, 2024
90
$
154.36
5.56 years$
202
(1)
The aggregate intrinsic value is calculated as the difference between the closing market price of $152.77 per
common share as of December 31, 2024 and the exercise price of the stock options. It excludes the effect of
stock options that have a zero or negative intrinsic value.
The aggregate Black-Scholes fair value of $3.3 million for the stock options granted during the year ended December 31,
2024 was estimated using the following assumptions as of the grant date:
Year Ended December
31, 2024
Expected option term in years
4.5
Expected volatility
40.3%
Risk-free interest rate
4.2%
Expected annual dividend yield
—
The expected option term was calculated using the simplified method permitted under Codification of Staff Accounting
Bulletins Topic 14, “Share-Based Payment”. The expected volatility was determined based on the historical volatility of the
Company’s common shares over the expected option term. Risk-free interest rate was based upon U.S. treasury instruments. The
expected annual dividend yield is zero as the Company does not have plans to issue dividends.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
83
14. Employee Benefit Plans
Defined Contribution Plans
The Company has defined contribution employee retirement savings plans in the U.S., the U.K. and Japan. The Company
matches the contributions of participating employees on the basis of percentages specified in each plan. The Company’s matching
contributions to the plans were $6.8 million, $6.8 million and $5.9 million for the years ended December 31, 2024, December 31,
2023 and December 31, 2022, respectively.
Defined Benefit Plan
The Company maintains a frozen defined benefit pension plan in the U.K. (the “U.K. Plan”). The U.K. Plan was closed to
new membership in 1997 and stopped accruing additional pension benefits for existing members in 2003. Benefits under the U.K.
Plan were based on the participants’ years of service and compensation as of the date the plan was frozen in 2003, adjusted for
inflation. The Company continues to fund the plan in accordance with the pension regulations in the U.K.
The net periodic pension cost is included in other income (expense) in the consolidated statements of operations and consisted
of the following components (in thousands):
Year Ended December 31,
2024
2023
2022
Components of the net periodic pension cost:
Interest cost
$
1,158
$
1,185
$
669
Expected return on plan assets
(1,466)
(1,440)
(1,286)
Amortization of actuarial losses
851
990
380
Amortization of prior service cost
30
30
32
Net periodic pension cost
$
573
$
765
$
(205)
The actuarial assumptions used to compute the net periodic pension cost for the years ended December 31, 2024, December
31, 2023 and December 31, 2022, respectively, were as follows:
Year Ended December 31,
2024
2023
2022
Weighted-average discount rate
4.5%
4.8%
1.8%
Weighted-average long-term rate of return on plan assets
5.1%
5.3%
3.2%
The actuarial assumptions used to compute the benefit obligations as of December 31, 2024 and December 31, 2023,
respectively, were as follows:
December 31,
2024
2023
Weighted-average discount rate
5.5%
4.5%
Rate of inflation
3.1%
2.8%
The discount rates used are derived from (AA) corporate bonds that have maturities approximating the terms of the pension
obligations under the U.K. Plan. In estimating the expected return on plan assets, the Company considered the historical
performance of the major asset classes held by the U.K. Plan and current forecasts of future rates of return for these asset classes.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
84
The following table provides a reconciliation of benefit obligations and plan assets of the U.K. Plan (in thousands):
December 31,
2024
2023
Change in benefit obligation:
Projected benefit obligation at beginning of year
$
26,259
$
24,597
Interest cost
1,158
1,185
Actuarial (gains) losses (1)
(3,393)
445
Benefits paid
(1,374)
(1,257)
Prior service cost
—
—
Foreign currency exchange rate changes
(250)
1,289
Projected benefit obligation at end of year
$
22,400
$
26,259
Accumulated benefit obligation at end of year
$
22,400
$
26,259
Change in plan assets:
Fair value of plan assets at beginning of year
$
29,351
$
26,609
Actual return on plan assets
(1,311)
1,575
Employer contributions
287
1,007
Benefits paid
(1,374)
(1,257)
Foreign currency exchange rate changes
(308)
1,417
Fair value of plan assets at end of year
$
26,645
$
29,351
Funded status at end of year
$
4,245
$
3,092
Amounts included in accumulated other comprehensive loss not yet recognized in net periodic
pension cost:
Net actuarial losses at beginning of year
$
(7,772) $
(8,076)
Net actuarial gains (losses) during the year
627
(310)
Prior service cost arising during the year
—
—
Amounts reclassified from accumulated other comprehensive loss to income before income taxes
881
1,020
Foreign currency exchange rate changes
67
(406)
Net actuarial losses
$
(6,197) $
(7,772)
(1)
Actuarial (gains)/losses in the U.K. Plan for the years ended December 31, 2024 and December 31, 2023,
respectively, primarily resulted from changes in the discount rate assumptions.
The funded status of the U.K. Plan was included in other long term assets on the accompanying consolidated balance sheet as
of December 31, 2024 and December 31, 2023, respectively.
The following table reflects the total expected benefit payments to plan participants for each of the next five years and the
following five years in aggregate and have been estimated based on the same assumptions used to measure the Company’s benefit
obligations as of December 31, 2024 (in thousands):
Amount
2025
$
1,298
2026
1,568
2027
1,642
2028
1,615
2029
1,613
2030-2034
9,678
Total
$
17,414
In the U.K., defined benefit pension plan funding valuations are conducted every three years to determine the future level of
contributions. Based on the results of the most recent valuation in 2024, the Company will not be required to contribute any
additional funds for the next three years. Future annual funding contributions, if any, will be determined in the next statutory
funding valuation in 2027.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
85
Fair Value of Plan Assets
The trustee of the U.K. Plan has the fiduciary responsibilities to manage the plan assets in consultation with the Company.
The overall objective is to invest plan assets in a portfolio of diversified assets, primarily through the use of institutional collective
funds. During the year ended December 31, 2023, the investment strategy was gradually shifted from a balanced growth strategy
that combines investments in growth assets (such as equities and credit) with investments in debt instruments that match a portion of
the expected future benefit payments to a strategy that is progressively more focused on matching the benefit payments based on a
series of de-risking triggers that are based on the funding level. As these triggers are hit, the assets are shifted from growth assets
into fixed income investments leading to an increasingly low risk approach.
The following table summarizes the fair values of Plan assets by asset category as of December 31, 2024 (in thousands):
Asset Category
Fair Value
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
Significant Other
Observable
Inputs
(Level 2)
Significant Other
Unobservable
Inputs
(Level 3)
Not
Subject to
Leveling
Mutual Funds:
Balanced (1)
$
5,118
$
—
$
—
$
—
$
5,118
Fixed income (2)
21,136
—
—
—
21,136
Cash
391
391
—
—
—
Total
$
26,645
$
391
$
—
$
—
$
26,254
(1)
This class comprises a diversified portfolio of global investments which seeks growth from equities and credit
assets. It is allocated on a weighted average basis as follows: equities (5%), bonds (90%) and other assets (5%).
(2)
This class comprises a diversified portfolio of global investments which seeks fixed income growth and is
allocated on a weighted average basis as follows: bonds (79%) and other assets (21%).
The following table summarizes the fair values of Plan assets by asset category as of December 31, 2023 (in thousands):
Asset Category
Fair Value
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
Significant Other
Observable
Inputs
(Level 2)
Significant Other
Unobservable
Inputs
(Level 3)
Not
Subject to
Leveling
Mutual Funds:
Balanced (1)
$
18,978
$
—
$
—
$
—
$
18,978
Fixed income (2)
10,129
—
—
—
10,129
Cash
244
244
—
—
—
Total
$
29,351
$
244
$
—
$
—
$
29,107
(1)
This class comprises a diversified portfolio of global investments which seeks growth from equities and credit
assets. It is allocated on a weighted average basis as follows: equities (11%), bonds (64%) and other assets
(25%).
(2)
This class comprises a diversified portfolio of global investments which seeks fixed income growth and is
allocated on a weighted average basis as follows: bonds (95%) and other assets (5%).

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
86
15. Income Taxes
Components of the Company’s income (loss) before income taxes for the periods indicated are as follows (in thousands):
Year Ended December 31,
2024
2023
2022
Income (loss) before income taxes:
Canada
$
(7,425) $
(6,490) $
(4,946)
U.S.
11,829
38,992
28,365
Other
74,662
51,246
63,740
Total
$
79,066
$
83,748
$
87,159
Components of the Company’s income tax provision (benefit) for the periods indicated are as follows (in thousands):
Year Ended December 31,
2024
2023
2022
Current
Canada
$
43
$
59
$
65
U.S.
11,198
14,424
17,205
Other
19,647
11,113
14,492
30,888
25,596
31,762
Deferred
Canada
—
—
—
U.S.
(12,612)
(12,224)
(15,370)
Other
(3,297)
(2,502)
(3,284)
(15,909)
(14,726)
(18,654)
Total
$
14,979
$
10,870
$
13,108
The Company is incorporated in Canada and therefore uses the Canadian statutory rate for income tax disclosure. The
reconciliation of the statutory Canadian tax rate to the effective tax rate related to income before income taxes for the periods
indicated is as follows (in thousands, except percentage data):
Year Ended December 31,
2024
2023
2022
Statutory Canadian tax rate
29.00%
29.00%
29.00%
Expected income tax provision at Canadian statutory tax rate
$
22,929
$
24,287
$
25,276
U.S. state income taxes, net
(168)
860
3
U.K. patent box
(3,982)
(4,247)
(3,135)
Foreign-derived intangible income
(3,015)
(4,500)
(4,467)
International tax rate differences
(2,622)
(4,804)
(6,289)
Tax credits
(2,590)
(3,602)
(2,256)
Change in valuation allowance
1,930
2,068
2,048
Disallowed compensation
1,678
2,571
2,138
Withholding and other taxes
854
300
789
Windfall benefit from share-based compensation
(844)
(1,685)
(254)
Transaction costs and permanent differences
360
423
140
Uncertain tax positions
244
90
(168)
Provision to return differences
231
(1,056)
(19)
Acquisition contingent consideration adjustments
(81)
—
(698)
Statutory tax rate changes
55
165
—
Reported income tax provision
$
14,979
$
10,870
$
13,108
Effective tax rate
18.9%
13.0%
15.0%

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
87
Deferred income taxes result principally from temporary differences in the recognition of certain revenue and expense items
and operating loss and tax credit carryforwards for financial and tax reporting purposes. Significant components of the Company’s
deferred tax assets and liabilities as of December 31, 2024 and December 31, 2023 are as follows (in thousands):
December 31,
2024
2023
Deferred tax assets:
Capitalized R&D
$
34,777
$
25,238
Inventories
15,451
12,497
Losses
12,606
11,274
Compensation related deductions
9,323
8,457
Operating lease liabilities
9,120
10,194
Tax credits
3,260
3,222
Business interest expense
1,483
-
Other
974
724
Warranty
913
964
Total deferred tax assets
87,907
72,570
Valuation allowance on deferred tax assets
(18,594)
(16,674)
Net deferred tax assets
$
69,313
$
55,896
Deferred tax liabilities:
Amortization
$
(39,061)
$
(24,436)
Operating lease right-of-use assets
(8,110)
(9,198)
Depreciation
(6,307)
(5,389)
Deferred revenue
(6,041)
(5,316)
Total deferred tax liabilities
$
(59,519)
$
(44,339)
Net deferred tax assets (liabilities)
$
9,794
$
11,557
In determining its income tax provisions, the Company calculated deferred tax assets and liabilities for each separate
jurisdiction. The Company then considered a number of factors, including positive and negative evidence related to the realization
of its deferred tax assets, to determine whether a valuation allowance should be recognized with respect to its deferred tax assets.
The Company began to capitalize research and development (“R&D”) expenditures in 2022 in accordance with the Tax Cuts
and Jobs Act of 2017 (“TCJA”) which requires that R&D expenditures be capitalized and amortized for income tax purposes over
five years for domestic research and fifteen years for foreign research, rather than being deducted as incurred. This has the effect of
increasing the Company’s cash taxes and deferred tax assets. For the year ended December 31, 2024, the Company’s deferred tax
assets related to capitalized R&D expenditures increased $9.5 million, which also created an effective tax rate benefit of 2.0% by
increasing the Company's Foreign Derived Intangible Income deduction.
During the years ended December 31, 2024, and December 31, 2023, the Company recorded an additional valuation
allowance of $1.9 million, and $2.1 million, respectively.
As of December 31, 2024, the Company had valuation allowances on Canada net operating and capital loss carryforwards,
U.K. capital loss carryforwards, certain U.S. state net operating losses, and state and foreign tax credits that the Company has
determined that they are not more likely than not to be realized. In conjunction with the Company’s ongoing review of its actual
results and anticipated future earnings, the Company continuously reassesses the possibility of releasing the valuation allowance
currently in place on its deferred tax assets.
As of December 31, 2024, the Company had net operating loss carry forwards of $6.8 million (tax effected). Of this amount,
approximately $6.5 million relates to Canada and begins to expire starting in 2033 and had a full valuation allowance. The
remainder $0.3 million relates to various U.S. jurisdictions, of which $0.1 million can be carried forward indefinitely and the
remaining $0.2 million will begin to expire in 2025 through 2036, on which the Company records a valuation allowance of $0.1
million. In addition, the Company had capital loss carryforwards of $5.8 million, which can be carried forward indefinitely and had

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
88
a full valuation allowance. Of this amount, $4.9 million, $0.8 million and $0.1 million relates to Canada, the U.K and other foreign
jurisdictions, respectively.
As of December 31, 2023, the Company had net operating loss carryforwards of $5.7 million (tax effected). Of this amount,
approximately $5.2 million relates to Canada and begins to expire starting in 2033 and had a full valuation allowance. The
remaining $0.5 million relates to various U.S jurisdictions, which will expire between 2024 and 2043. In addition, the Company had
capital loss carryforwards of $5.6 million, which can be carried forward indefinitely and had a full valuation allowance. Of this
amount, $4.9 million related to Canada and the remaining $0.7 million related to the U.K.
As of December 31, 2024, the Company had tax credit carryforwards of approximately $3.8 million, before accounting for
$0.6 million of uncertain tax positions recorded against the credit carryforward. Approximately $2.6 million relates to U.S. state
credits and will expire through 2039, and on which the Company maintains a full valuation allowance, $0.5 million relates to the
U.S. federal foreign tax credits which will expire through 2034. The remaining $0.7 million relates to Canada and can be carried
forward indefinitely. The U.S. federal and Canadian tax credit carryforwards also have a full valuation allowance recorded against
them.
As of December 31, 2023, the Company had tax credit carryforwards of approximately $3.7 million. Approximately $3.0
million relates to the U.S. and other immaterial foreign jurisdictions and will expire through 2039, and $0.7 million relates to
Canada and can be carried forward indefinitely. The Company had a $2.9 million valuation allowance on these tax credit
carryforwards.
As of December 31, 2024, the Company had disallowed business interest expense carryforwards of $1.5 million under Section
163(j) of the Internal Revenue Code. These carryforwards have no expiration date and can be utilized indefinitely to offset future
taxable income, subject to the limitations of Section 163(j). No business interest expense carryforward existed as of December 31,
2023.
Income and foreign withholding taxes have not been recognized on the excess of the amount for financial reporting purposes
over the tax basis of investments in foreign subsidiaries that are essentially permanent in nature. This amount becomes taxable upon
the repatriation of assets from a subsidiary or a sale or liquidation of a subsidiary. The amount of undistributed earnings of foreign
subsidiaries totaled $494.9 million as of December 31, 2024. The estimated unrecognized income tax and foreign withholding tax
liability on these undistributed earnings is approximately $7.3 million.
As of December 31, 2024, the Company’s total amount of gross unrecognized tax benefits was $4.8 million, of which $4.1
million would favorably affect the effective tax rate if benefited. Over the next twelve months, the Company may need to recognize
up to $0.8 million of previously recorded unrecognized tax benefits due to statute of limitations closures. Furthermore, the
Company believes there are no jurisdictions in which the outcome of unresolved issues or claims is likely to be material to its results
of operations, financial position or cash flows. Furthermore, the Company believes that it has adequately provided for all significant
income tax uncertainties.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
89
The reconciliation of the total amounts of unrecognized tax benefits is as follows (in thousands):
Balance at December 31, 2021
$
4,797
Additions based on tax positions related to the current year
553
Additions for tax positions of prior years
34
Reductions to tax positions of prior years
(563)
Reductions to tax positions resulting from a lapse of the applicable statute of limitations
(572)
Settlements with tax authorities
—
Balance at December 31, 2022
4,249
Additions based on tax positions related to the current year
561
Additions for tax positions of prior years
47
Reductions to tax positions of prior years
(22)
Reductions to tax positions resulting from a lapse of the applicable statute of limitations
(492)
Settlements with tax authorities
—
Balance at December 31, 2023
4,343
Additions based on tax positions related to the current year
949
Additions for tax positions of prior years
204
Reductions to tax positions of prior years
(42)
Reductions to tax positions resulting from a lapse of the applicable statute of limitations
(615)
Settlements with tax authorities
—
Balance at December 31, 2024
$
4,839
The Company recognizes interest and penalties related to uncertain tax positions in income tax provision. As of December 31,
2024 and 2023, the Company had approximately $0.8 million and $0.7 million, respectively, of accrued interest and penalties
related to uncertain tax positions. During the years ended December 31, 2024, December 31, 2023 and December 31, 2022, the
Company recognized $0.1 million, $0.1 million and $0.1 million, respectively, of expense for an increase in interest and penalties
related to uncertain tax positions.
The Company files income tax returns in Canada, the U.S., and various foreign jurisdictions. Generally, the Company is no
longer subject to U.S. or foreign income tax examinations, including transfer pricing tax audits, by tax authorities for the years
before 2014.
The Company’s income tax returns may be reviewed by tax authorities in the following countries for the following periods
under the appropriate statute of limitations:
United States
2019 - Present
Canada
2017 - Present
United Kingdom
2023 - Present
Germany
2017 - Present
Czech Republic
2022 - Present
China
2014 - Present
Japan
2019 - Present

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
90
16. Restructuring, Acquisition and Related Costs
The following table summarizes restructuring, acquisition and related costs recorded in the accompanying consolidated
statements of operations for the periods indicated (in thousands):
Year Ended December 31,
2024
2023
2022
2024 restructuring
$
10,486
$
—
$
—
2022 restructuring
—
8,961
1,414
2020 restructuring
—
2,853
2,994
Total restructuring related charges
$
10,486
$
11,814
$
4,408
Acquisition and related charges
$
3,223
$
1,000
$
(24)
Total restructuring, acquisition and related costs
$
13,709
$
12,814
$
4,384
2024 Restructuring
As a result of the Company’s acquisitions and ongoing integration activities, the Company initiated the 2024 restructuring
program in the first quarter of 2024 in order to reduce operating complexity. During the year ended December 31, 2024, the
Company recorded $10.5 million in severance, facility related and other charges in connection with the 2024 restructuring program.
As of December 31, 2024, the Company had incurred cumulative costs of $10.5 million related to this restructuring program. The
Company anticipates substantially completing the 2024 restructuring program in the first half of 2025 and expects to incur
additional restructuring charges of $4.0 million to $5.0 million related to the 2024 restructuring program.
The following table summarizes restructuring costs associated with the 2024 restructuring program by reportable segment (in
thousands):
Year Ended December 31,
Cumulative Costs as of
2024
December 31, 2024
Automation Enabling Technologies
$
3,198
$
3,198
Medical Solutions
6,769
6,769
Unallocated costs
519
519
Total
$
10,486
$
10,486
2022 Restructuring
As a result of the Company’s ongoing evaluations and efforts to reduce its operating costs, while improving efficiency and
effectiveness, the Company initiated the 2022 restructuring program in the third quarter of 2022. This program was focused on
reducing operating complexity in the Company, including reducing infrastructure costs and streamlining the Company’s operating
model to better serve its customers. In addition, the program was focused on cost reduction actions to improve gross margins for the
overall company. As of December 31, 2024, the Company had incurred cumulative costs of $10.4 million related to the 2022
restructuring program. The 2022 restructuring program was completed in the fourth quarter of 2023.
The following table summarizes restructuring costs associated with the 2022 restructuring program by reportable segment (in
thousands):
Year Ended December 31,
Cumulative Costs
as of
2023
2022
December 31, 2024
Automation Enabling Technologies
$
6,771 $
1,358
$
8,129
Medical Solutions
1,359
56
1,415
Unallocated costs
831
—
831
Total
$
8,961 $
1,414
$
10,375

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
91
2020 Restructuring
As a result of the Company’s ongoing evaluations and efforts to reduce its operating costs, while improving efficiency and
effectiveness, the Company initiated the 2020 restructuring program in the third quarter of 2020. This program was focused on
reducing operating complexity in the Company, including reducing infrastructure costs and streamlining the Company’s operating
model to better serve its customers. In addition, the program was focused on cost reduction actions to improve gross margins for the
overall company. As of December 31, 2024, the Company had incurred cumulative costs of $16.7 million related to the 2020
restructuring program. The 2020 restructuring program was completed in the fourth quarter of 2023. In January 2025, the Company
sold an owned facility with a $3.6 million gain.
The following table summarizes restructuring costs associated with the 2020 restructuring program by reportable segment (in
thousands):
Year Ended December 31,
Cumulative Costs
as of
2023
2022
December 31, 2024
Automation Enabling Technologies
$
2,853 $
2,775
$
13,827
Medical Solutions
—
217
2,716
Unallocated costs
—
2
173
Total
$
2,853 $
2,994
$
16,716
Roll-forward of Accrued Expenses Related to Restructuring Programs
The following table summarizes the accrual activities, by component, related to the Company’s restructuring programs
recorded in the accompanying consolidated balance sheets (in thousands):
Total
Employee Related
Facility Related
Other
Balance at December 31, 2022
$
2,410
$
1,902
$
452
$
56
Restructuring charges
11,814
5,832
4,452
1,530
Cash payments
(8,867)
(6,675)
(1,379)
(813)
Non-cash write-offs and other adjustments (1)
(2,507)
(21)
(1,845)
(641)
Balance at December 31, 2023
2,850
1,038
1,680
132
Restructuring charges
10,486
8,165
2,034
287
Cash payments
(5,898)
(3,469)
(2,007)
(422)
Non-cash write-offs and other adjustments
(687)
(44)
(646)
3
Balance at December 31, 2024
$
6,751
$
5,690
$
1,061
$
—
(1) Non-cash write-offs and other adjustments included impairment of assets amounting to $2.5 million.
Acquisition and Related Charges
Acquisition costs incurred in connection with business combinations, primarily including finders’ fees, legal, valuation and
other professional or consulting fees, totaled $3.5 million, $1.0 million, and $1.4 million during 2024, 2023, and 2022, respectively.
Acquisition related costs/(income) recognized under earn-out agreements in connection with acquisitions totaled $(0.3) million,
zero, and $(1.4) million during 2024, 2023, and 2022, respectively. A majority of the acquisition and related costs of $3.2 million
for 2024 were not allocated to any of the reportable segments.
17. Commitments and Contingencies
Purchase Commitments
As of December 31, 2024, the Company had purchase commitments primarily for inventory purchases of $138.7 million.
These purchase commitments are expected to be incurred as follows: $126.3 million in 2025, $11.4 million in 2026 and $1.0 million
in 2027.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
92
Legal Proceedings
The Company is subject to various other legal proceedings and claims that arise in the ordinary course of business. The
Company reviews the status of each significant matter and assesses the potential financial exposure on a quarterly basis. If the
potential loss from any claim or legal proceeding is considered probable and the amount can be reasonably estimated, the Company
accrues a liability for the estimated loss. Significant judgment is required in both the determination of the probability of an exposure
and the determination as to whether the exposure is reasonably estimable. Because of uncertainties related to these matters, accruals
are based only on the best information available as of the date of the consolidated balance sheet. As additional information becomes
available, the Company reassesses the potential liability related to any pending claims and litigation and may revise its estimates.
The Company does not believe that the outcome of these claims will have a material adverse effect on its consolidated financial
statements but there can be no assurance that any such claims, or any similar claims, would not have a material adverse effect on its
consolidated financial statements.
Guarantees and Indemnifications
In the normal course of its operations, the Company executes agreements that provide for indemnification and guarantees to
counterparties in transactions such as business dispositions, sale of assets, sale of products and operating leases. Additionally, the
by-laws of the Company require it to indemnify certain current or former directors, officers, and employees of the Company against
expenses incurred by them in connection with each proceeding in which they are involved as a result of serving or having served in
certain capacities. Indemnification is not available with respect to a proceeding as to which it has been adjudicated that the person
did not act in good faith in the reasonable belief that the action was in the best interests of the Company. Certain of the Company’s
officers and directors are also a party to indemnification agreements with the Company. These indemnification agreements provide,
among other things, that the director and officer shall be indemnified to the fullest extent permitted by applicable law against all
expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by such officer or director in connection
with any proceeding by reason of their relationship with the Company. In addition, the indemnification agreements provide for the
advancement of expenses incurred by such director or officer in connection with any proceeding covered by the indemnification
agreement, subject to the conditions set forth therein and to the extent such advancement is not prohibited by law. The
indemnification agreements also set out the procedures for determining entitlement to indemnification, the requirements relating to
notice and defense of claims for which indemnification is sought, the procedures for enforcement of indemnification rights, the
limitations on and exclusions from indemnification, and the minimum levels of directors’ and officers’ liability insurance to be
maintained by the Company.
On July 1, 2013, the Company provided a Guarantee (the “Guarantee”) in favor of the trustees of the U.K. Plan with respect
to all present and future obligations and liabilities, whether actual or contingent and whether owed jointly or severally and in any
capacity whatsoever, of Novanta Technologies U.K. Limited, a wholly owned subsidiary of Novanta Inc.
Credit Risks and Other Uncertainties
The Company maintains financial instruments such as cash and cash equivalents and trade receivables. From time to time,
certain of these instruments may subject the Company to concentrations of credit risk whereby one institution may hold a significant
portion of the cash and cash equivalents, or one customer may represent a large portion of the accounts receivable balances.
As of December 31, 2024, and December 31, 2023, one customer represented approximately 13% and 10%, respectively, of
the Company's outstanding accounts receivable balance. Credit risk with respect to trade accounts receivable is generally minimized
because of the diversification of the Company’s operations, as well as its large customer base and its geographic dispersion.
Certain components and materials included in the Company’s products are currently purchased from single source suppliers.
There can be no assurance that a disruption of the supply of such components and materials would not create substantial
manufacturing delays and additional cost to the Company.
The Company’s operations involve a number of other risks and uncertainties including, but not limited to, the effects of
general economic conditions, rapidly changing technologies, and international operations.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
93
18. Segment Information
Reportable Segments
The Company’s Chief Operating Decision Maker (“CODM”) is the Chief Executive Officer. The CODM utilizes financial
information to make decisions about allocating resources and assessing performance for the entire Company. The CODM evaluates
the performance of, and allocates resources to, its segments based on revenue, gross profit and operating income. The Company’s
reportable segments have been identified based on commonality and adjacency of end markets and customers amongst the
Company’s individual product lines.
During the fourth quarter of 2024, the Company updated its organizational structure and re-aligned its financial reporting
structure under two reportable segments: Automation Enabling Technologies and Medical Solutions. Prior to the reorganization, the
Company's historical reportable segments were: Precision Medicine and Manufacturing, Robotics and Automation, and Medical
Solutions. Prior period segment financial information has been recast to align with the new reportable segments herein, as well as in
Notes 6 and 16.
Automation Enabling Technologies
The Automation Enabling Technologies segment designs, manufactures and markets laser beam delivery components, laser
beam delivery solutions, CO2 lasers, solid state lasers, ultrafast lasers, optical and inductive encoders, precision motors, integrated
stepper motors, servo drives, motion control solutions, intelligent robotic end-of-arm technology solutions, and air bearing spindles
to customers worldwide. The segment serves highly demanding applications for advanced industrial processes, advanced industrial
and medical robotics, other medical and life science automation applications, and medical laser procedures such as ophthalmology
applications. The vast majority of the segment’s product offerings are sold to OEM customers. The segment sells the majority of
these products directly, utilizing a highly technical sales force, and also sells some indirectly, through resellers and distributors.
Medical Solutions
The Medical Solutions segment designs, manufactures and markets a range of medical grade technologies, including medical
insufflators and endoscopic pumps and related disposables, laser beam delivery solutions, video processing and streaming and
capture, machine vision technologies, radio frequency identification (“RFID”) technologies, barcode identification technologies,
thermal chart recorders, light and color measurement technologies, touch panel displays, and advanced motion control solutions.
The vast majority of the segment’s product offerings are sold to OEM customers. The segment sells the majority of these products
directly, utilizing a highly technical sales force, and also sells some indirectly, through resellers and distributors.

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
94
Reportable Segment Financial Information
Results of operations, depreciation and amortization expenses, accounts receivable and inventories by reportable segments for
the periods indicated were as follows (in thousands):
Year Ended December 31, 2024
Automation
Enabling
Technologies
Medical Solutions
Total
Revenue
$
490,620
$
458,625
$
949,245
Cost of revenue
249,364
260,176
Amortization of purchased intangible assets
6,281
8,492
Gross profit
234,975
189,957
424,932
Research and development and engineering
39,026
57,110
Selling, general and administrative
75,423
53,798
Amortization of purchased intangible assets
11,207
14,587
Restructuring, acquisition, and related costs
2,916
6,930
Segment operating income
106,403
57,532
163,935
Unallocated costs
—
—
(53,351)
Interest income (expense), net
—
—
(31,489)
Other income (expense), net
—
—
(29)
Income before income taxes
$
106,403
$
57,532
$
79,066
Year Ended December 31, 2023
Automation
Enabling
Technologies
Medical Solutions
Total
Revenue
$
499,220
$
382,442
$
881,662
Cost of revenue
257,377
206,550
Amortization of purchased intangible assets
7,045
5,105
Gross profit
234,798
170,787
405,585
Research and development and engineering
43,024
49,440
Selling, general and administrative
72,860
49,227
Amortization of purchased intangible assets
12,942
7,503
Restructuring, acquisition, and related costs
9,691
1,359
Segment operating income
96,281
63,258
159,539
Unallocated costs
—
—
(49,043)
Interest income (expense), net
—
—
(25,818)
Other income (expense), net
—
—
(930)
Income before income taxes
$
96,281
$
63,258
$
83,748

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
95
Year Ended December 31, 2022
Automation
Enabling
Technologies
Medical Solutions
Total
Revenue
$
534,090
$
326,813
$
860,903
Cost of revenue
281,689
181,908
Amortization of purchased intangible assets
7,396
5,874
Gross profit
245,005
139,031
384,036
Research and development and engineering
45,444
40,416
Selling, general and administrative
73,554
42,634
Amortization of purchased intangible assets
17,662
8,676
Restructuring, acquisition, and related costs
2,920
432
Segment operating income
105,425
46,873
152,298
Unallocated costs
—
—
(49,219)
Interest income (expense), net
—
—
(15,616)
Other income (expense), net
—
—
(304)
Income before income taxes
$
105,425
$
46,873
$
87,159
Year Ended December 31,
2024
2023
2022
Depreciation and Amortization Expenses
Automation Enabling Technologies
$
23,873
$
26,680
$
32,334
Medical Solutions
29,818
18,578
20,425
Unallocated
1,872
1,354
399
Total
$
55,563
$
46,612
$
53,158
December 31,
2024
2023
Accounts Receivable
Automation Enabling Technologies
$
70,829
$
71,131
Medical Solutions
80,197
68,279
Total accounts receivable
$
151,026
$
139,410
Inventories
Automation Enabling Technologies
$
89,009
$
103,326
Medical Solutions
55,597
46,045
Total inventories
$
144,606
$
149,371
Total segment assets
$
295,632
$
288,781
December 31,
2024
2023
Total Assets
Total segment assets
$
295,632
$
288,781
Cash and cash equivalents
113,989
105,051
Prepaid income taxes and income taxes receivable
8,076
8,105
Prepaid expenses and other current assets
15,951
13,360
Property, plant and equipment, net
113,135
109,449
Operating lease assets
42,908
38,302
Deferred tax assets
22,887
27,862
Other assets
5,991
5,617
Intangible assets, net
185,844
145,022
Goodwill
584,098
484,507
Total
$
1,388,511
$
1,226,056

NOVANTA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
AS OF DECEMBER 31, 2024
96
Geographic Information
The Company aggregates geographic revenue based on the customer location where products are shipped. Revenue from
these customers is summarized for the periods indicated as follows (in thousands, except percentage data):
Year Ended December 31,
2024
2023
2022
Revenue
% of Total
Revenue
% of Total
Revenue
% of Total
United States
$
487,114
51.3% $
418,265
47.4% $
372,345
43.3%
Germany
123,244
13.0
128,229
14.5
133,728
15.5
Rest of Europe
128,871
13.6
137,027
15.6
137,803
16.0
China
84,562
8.9
73,444
8.3
97,178
11.3
Rest of Asia-Pacific
107,054
11.3
105,350
12.0
101,596
11.8
Other
18,400
1.9
19,347
2.2
18,253
2.1
Total
$
949,245
100.0% $
881,662
100.0% $
860,903
100.0%
Long-lived assets consist of property, plant and equipment, net, and are aggregated based on the location of the assets. A
summary of these long-lived assets is as follows (in thousands):
December 31,
2024
2023
United States
$
25,207
$
23,899
Germany
31,684
35,318
U.K.
34,078
28,734
Czech Republic
15,345
14,100
China
6,561
7,114
Rest of World
260
284
Total
$
113,135
$
109,449
Revenue by End Market
The Company primarily operates in two end markets: the medical market and the advanced industrial market. Revenue by end
market was approximately as follows:
Year Ended December 31,
2024
2023
2022
Medical
55%
54%
49%
Advanced Industrial
45%
46%
51%
Total
100%
100%
100%
The majority of the revenue from the Automation Enabling Technologies segment is generated from sales to customers in the
advanced industrial market. The majority of the revenue from the Medical Solutions segment is generated from sales to customers
in the medical market.
Significant Customers
During the years ended December 31, 2024 and December 31, 2023, respectively, an OEM customer primarily from the
Medical Solutions segment accounted for approximately 10% of the Company's consolidated revenue. No customer accounted for
greater than 10% of the Company's consolidated revenue during the year ended December 31, 2022.

97
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
The information required by this Item 9 was previously reported in the Company's Current Report on Form 8-K that was filed
with the Securities and Exchange Commission on March 15, 2024.
Item 9A. Controls and Procedures
The required certifications of our Chief Executive Officer and Chief Financial Officer are included in Exhibits 31.1 and 31.2 to
this Annual Report on Form 10-K. The disclosures set forth in this Item 9A contain information concerning the evaluation of our
disclosure controls and procedures, management’s report on internal control over financial reporting and changes in internal control
over financial reporting referred to in those certifications. Those certifications should be read in conjunction with this Item 9A for a
more complete understanding of the matters covered by the certifications.
Evaluation of Disclosure Controls and Procedures as of December 31, 2024
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of
our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act
of 1934, as amended (the “Exchange Act”), as of December 31, 2024. Based on this evaluation, our Chief Executive Officer and Chief
Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2024.
Changes in Internal Control Over Financial Reporting
There has been no change to our internal control over financial reporting during the fiscal quarter ended December 31, 2024 that
has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Management’s Annual Report on Internal Control Over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in
Rules 13a-15(f) under the Exchange Act. Internal control over financial reporting is designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance
with generally accepted accounting principles. Internal control over financial reporting includes those policies and procedures that:
•
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect our transactions and
dispositions of our assets;
•
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in
accordance with authorizations of our management and directors; and
•
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of
our assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of
changes in conditions and that the degree of compliance with the policies or procedures may deteriorate.
Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2024. In making
their assessment, our management utilized the criteria set forth in Internal Control—Integrated Framework (2013) issued by the
Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based on our evaluation under the framework in
Internal Control—Integrated Framework (2013), issued by COSO, our management concluded that our internal control over financial
reporting was effective as of December 31, 2024.
The effectiveness of our internal control over financial reporting as of December 31, 2024 has been audited by Deloitte &
Touche LLP, an independent registered public accounting firm, as stated in their report which is included in this Annual Report on
Form 10-K.

98
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of Novanta Inc.
Opinion on Internal Control over Financial Reporting
We have audited the internal control over financial reporting of Novanta Inc. and subsidiaries (the “Company”) as of December 31,
2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective
internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control – Integrated
Framework (2013) issued by COSO.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated financial statements as of and for the year ended December 31, 2024, of the Company and our report dated
February 25, 2025 expressed an unqualified opinion on those financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of
the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal
Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial
reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with
respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities
and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness
exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such
other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our
opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the
maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the
company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect
on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Deloitte & Touche LLP
Boston, Massachusetts
February 25, 2025

99
Item 9B. Other Information
Rule 10b5-1 Trading Plans
No officers or directors adopted, modified, and/or terminated a “Rule 10b5-1 trading agreement” or a “non-Rule 10b5-1 trading
agreement,” as defined in Item 408 of Regulation S-K, during the three months ended December 31, 2024.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
PART III
Certain information required by Part III is omitted from this Annual Report on Form 10-K and is incorporated herein by
reference to the Company’s Definitive Proxy Statement for the 2025 Annual Meeting of Shareholders to be filed with the Securities
and Exchange Commission.
Item 10. Directors, Executive Officers and Corporate Governance
All of the Company’s directors, officers and employees must act in accordance with the Code of Ethics and Business Conduct,
which has been adopted by the Company’s Board of Directors. A copy of the Code of Ethics and Business Conduct is available on the
Company’s website at https://www.novanta.com in the “About Us” section. (This website address is not intended to function as a
hyperlink, and the information contained in our website is not intended to be a part of this filing). The Company intends to satisfy the
disclosure requirement under Nasdaq rules regarding waivers or under Item 5.05 of Form 8-K regarding disclosure of an amendment
to, or waiver from, a provision of this Code of Ethics and Business Conduct, including with respect to its principal executive officer,
principal financial officer, principal accounting officer or controller, or persons performing similar functions, by posting such
information on the Company’s website at https://www.novanta.com in the “About Us” section, unless a Form 8-K is otherwise
required by law or applicable listing rules.
We have adopted an insider trading policy governing the purchase, sale, and other disposition of our securities by our directors,
officers, and employees, and by the Company. We believe this policy is reasonably designed to promote compliance with insider
trading laws, rules, and regulations and listing standards applicable to the Company. A copy of our insider trading policy is filed as
Exhibit 19.1 to this Form 10-K.

100
The following table sets forth information with respect to the Company’s directors and executive officers as of February 25,
2025:
Name
Age
Position with Novanta
Principal Employment
Executive Officers
Matthijs Glastra
56 Chair of the Board and Chief Executive
Officer of Novanta
Same
Robert Buckley
50 Chief Financial Officer of Novanta
Same
John Lesica
49 Co-Chief Operating Officer, Medical
Solutions
Same
Chuck Ravetto
54 Co-Chief Operating Officer, Automation
Enabling Technologies
Same
Michele Welsh
51 General Counsel and Corporate Secretary
of Novanta
Same
Non-Employee Directors
Lonny J. Carpenter
63 Director
Independent Lead Director
Chair of the Compensation Committee
Member of the Environmental, Social
and Governance (“ESG”) Committee
Former Group President of Stryker Corporation, a
medical technologies company
Barbara B. Hulit
58 Director
Member of the Audit Committee
Member of the ESG Committee
Former Senior Vice President of Fortive Corporation, a
diversified industrial technology growth company, and
President and Chief Executive Officer of Fortive’s
Advanced Healthcare Solutions segment
R. Matthew Johnson
49 Director
President and Chief Executive Officer of Silicon Labs, a
global semiconductor technology company, since 2022.
Mary Katherine Ladone
58 Director
Former Corporate Officer and Senior Vice President,
Corporate Development, Strategy & Investor Relations at
Hill-Rom Holdings, Inc., a medical technology company.
Maxine L. Mauricio
53 Director
Chair of the ESG Committee
Executive Vice President, Chief Administrative Officer,
General Counsel and Secretary of EMCOR Group, Inc., a
provider of facilities construction and industrial services
Thomas N. Secor
54 Director
Member of the Audit Committee
Member of the ESG Committee
Managing Director of Morningside Heights Capital, an
investment firm
Darlene J. S. Solomon
66 Director
Member of the Compensation Committee
Former Senior Vice President and Chief Technology
Officer of Agilent Technologies, Inc. a global leader in
the life sciences, diagnostics and applied chemical
markets
Frank A. Wilson
66 Director
Chair of the Audit Committee
Member of the Compensation Committee
Former Chief Financial Officer and Senior Vice President
of PerkinElmer, Inc., a life sciences diagnostics,
discovery and analytical solutions company
The remainder of the response to this item is contained in the Proxy Statement for the Company’s Annual Meeting of
Shareholders scheduled to be held on May 29, 2025 and is incorporated herein by reference.
Item 11. Executive Compensation
The information required to be disclosed by this item is contained in the Proxy Statement for the Company’s Annual Meeting of
Shareholders scheduled to be held on May 29, 2025 and is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information required to be disclosed by this item is contained in the Proxy Statement for the Company’s Annual Meeting of
Shareholders scheduled to be held on May 29, 2025 and is incorporated herein by reference.

101
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information required to be disclosed by this item is contained in the Proxy Statement for the Company’s Annual Meeting of
Shareholders scheduled to be held on May 29, 2025 and is incorporated herein by reference.
Item 14. Principal Accountant Fees and Services
The information required to be disclosed by this item is contained in the Proxy Statement for the Company’s Annual Meeting of
Shareholders scheduled to be held on May 29, 2025 and is incorporated herein by reference.
PART IV
Item 15. Exhibits and Financial Statement Schedules
(a) Documents filed as part of this report:
1. List of Financial Statements
The financial statements required by this item are listed in Item 8, “Financial Statements and Supplementary Data” herein.
2. List of Financial Statement Schedules
All schedules are omitted because they are not applicable or not required or the required information is shown in the
consolidated financial statements or notes thereto.
3. List of Exhibits
Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
File No.
Exhibit
Filing Date
Filed/
Furnished
Herewith
2.1†
Securities Purchase Agreement, dated November 14, 2023, by
and between Novanta Corporation, Motion Solutions Holdings
LLC and Motion Solutions Parent Corp. including Amendment
to Securities Purchase Agreement dated January 1, 2024 by and
between by the parties thereto.
10-K
001-35083
2.3
02/28/2024
3.1
Certificate and Articles of Continuance of the Registrant, dated
March 22, 1999
S-3
333-202597
3.1
03/09/2015
3.2
By-Laws of the Registrant, as amended
10-K
001-35083
3.2
03/01/2021
3.3
Articles of Reorganization of the Registrant, dated July 23, 2010 8-K
000-25705
3.1
07/23/2010
3.4
Articles of Amendment of the Registrant, dated May 26, 2005
10-K
001-35083
3.4
03/01/2023
3.5
Articles of Amendment of the Registrant, dated December 29,
2010
8-K
000-25705
3.1
12/29/2010
3.6
Articles of Amendment of the Registrant, dated May 11, 2016
8-K
001-35083
10.1
05/12/2016
3.7
Articles of Amendment of the Registrant, dated April 29, 2022
10-Q
001-35083
3.6
05/10/2022
4.1
Specimen Stock Certificate
10-K
001-35083
4.1
02/28/2018
4.2
Form of Indenture, between the Registrant and Wilmington
Trust, National Association
S-3
333-229912
4.2
05/10/2022
4.3
Description of Registrant's Securities Registered Pursuant to
Section 12 of the Securities Exchange Act of 1934
10-K
001-35083
4.3
03/01/2023
10.1††
Novanta Inc. 2010 Incentive Award Plan (Amended and
Restated Effective March 19, 2021), as amended
8-K
001-35083
10.1
05/17/2021

102
Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
File No.
Exhibit
Filing Date
Filed/
Furnished
Herewith
10.2††
Form of Deferred Stock Unit Award Agreement
10-K
001-35083
10.59
03/30/2011
10.3††
Form of Stock Option Grant Notice and Stock Option
Agreement
10-Q
001-35083
10.2
08/02/2016
10.4
Amended and Restated Lease, dated May 1, 2012, by and
between GSI Group Inc. and 125 Middlesex Turnpike, LLC
8-K
001-35083
10.1
05/04/2012
10.5††
Form of Performance Stock Unit Award Grant Notice and
Performance Stock Unit Award Agreement
10-Q
001-35083
10.3
08/02/2016
10.6
Third Amended and Restated Credit Agreement, dated as of
December 31, 2019, by and among Novanta Corporation,
Novanta Inc., Novanta UK Investments Holding Limited,
Novanta Europe GmbH, Bank of America, N.A., as
Administrative Agent, Swing Line Lender, L/C Issuer and
lender, BofA Securities, Inc., as Joint Lead Arranger, JP Morgan
Chase Bank, N.A., as Joint Lead Arranger, Co-Syndication
Agent and lender, Wells Fargo Securities LLC, as Joint Lead
Arranger, Wells Fargo Bank, National Association, as Co-
Syndication Agent and lender, Silicon Valley Bank, as Co-
Documentation Agent and lender, TD Bank, N.A., as Co-
Documentation Agent and lender, Bank of Montreal, as Co-
Documentation Agent and lender, and HSBC Bank USA, N.A
and HSBC Bank UK., as lenders
8-K
001-35083
10.1
01/03/2020
10.7
Lease Agreement, dated as of May 31, 2013, by and between
JADAK, LLC and Hancock Part Development, LLC
10-Q
001-35083
10.3
05/06/2014
10.8††
Amended and Restated Employment Agreement, dated April 21,
2017, between Novanta Inc. and Matthijs Glastra
8-K
001-35083
10.1
04/24/2017
10.9††
Amended and Restated Employment Agreement, dated April 21,
2017, between Novanta Inc. and Robert Buckley
8-K
001-35083
10.2
04/24/2017
10.10††
Employment Agreement, dated April 21, 2017, between
Novanta Inc. and Brian Young
8-K
001-35083
10.3
04/24/2017
10.11††
Form of New Restricted Stock Unit Award Agreement
10-Q
001-35083
10.1
05/08/2017
10.12††
Form of New Performance Stock Unit Award Grant Notice and
Performance Stock Unit Award Agreement
10-Q
001-35083
10.2
05/08/2017
10.13††
Form of Indemnification Agreement, by and between Novanta
Inc. and certain officers and directors
10-Q
001-35083
10.2
11/01/2017
10.14††
Form of Indemnification Agreement, by and between Novanta
Corporation and certain officers and directors
10-Q
001-35083
10.3
11/01/2017
10.15
First Amendment, dated May 7, 2018, to Amended and Restated
Lease (dated as of May 1, 2012) by and between Novanta
Corporation and 125 Middlesex Turnpike, LLC
10-Q
001-35083
10.2
05/08/2018
10.16††
Novanta Inc. Non-Employee Director Compensation Policy
10-Q
001-35083
10.2
08/08/2023
10.17††
Form of Director Restricted Stock Unit Award Grant Notice and
Restricted Stock Unit Award Agreement
10-Q
001-35083
10.2
11/06/2018
10.18
First Amendment to Third Amended and Restated Credit
Agreement, dated March 27, 2020
8-K
001-35083
10.1
03/31/2020

103
Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
File No.
Exhibit
Filing Date
Filed/
Furnished
Herewith
10.19
Second Amendment to Third Amended and Restated Credit
Agreement, dated June 2, 2020
10-Q
001-35083
10.1
08/06/2020
10.20
Third Amendment to Third Amended and Restated Credit
Agreement, dated September 22, 2021
10-Q
001-35083
10.1
11/09/2021
10.21
Fourth Amendment to Third Amended and Restated Credit
Agreement, Dated October 5, 2021
8-K
001-35083
10.1
10/07/2021
10.22††
Form of Restricted Stock Unit Award Grant Notice and
Agreement
10-Q
001-35083
10.2
05/11/2021
10.23††
Form of Operating Cash Flow Performance Stock Unit Award
Grant Notice and Agreement
10-Q
001-35083
10.3
05/11/2021
10.24
Fifth Amendment to Third Amended and Restated Credit
Agreement, dated March 10, 2022
8-K
001-35083
10.1
03/15/2022
10.25††
Employment Agreement, dated July 11, 2022, between Novanta
Inc. and Michele Welsh
10-Q
001-35083
10.1
08/09/2022
10.26††
Form of Grant Notice and Award Agreement for Performance
Stock Unit Awards with rTSR Modifier
10-Q
001-35083
10.1
05/09/2023
19.1
Policy Regarding Trades in Securities by Directors, Officers,
Company Personnel and Other Insiders
*
21.1
Subsidiaries of the Registrant
*
23.1
Consent of Independent Registered Public Accounting Firm
(Deloitte & Touche LLP)
*
23.2
Consent of Independent Registered Public Accounting Firm
(PricewaterhouseCoopers LLP)
*
31.1
Chief Executive Officer Certification pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002
*
31.2
Chief Financial Officer Certification pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002
*
32.1
Chief Executive Officer Certification pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
**
32.2
Chief Financial Officer Certification pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
**
97.1
Policy for Recovery of Erroneously Awarded Compensation
10-K
001-35083
97.1
02/28/2024
101.INS
Inline XBRL Instance Document - the instance document does
not appear in the Interactive Data File because its XBRL tags
are embedded within the Inline XBRL document.
*
101.SCH
Inline XBRL Taxonomy Extension Schema Document
*
104
Cover Page Interactive Data File (formatted as Inline XBRL and
contained in Exhibit 101).
*

104
† Certain schedules or appendices to this exhibit have been omitted pursuant to Regulation S-K Item 601(a)(5). A copy of any omitted
schedule will be furnished to the Securities and Exchange Commission or its staff upon request.
†† This exhibit constitutes a management contract, compensatory plan, or arrangement.
* Filed herewith
** Furnished herewith
Item 16. Form 10-K Summary
None.

105
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Novanta Inc.
By: /s/ Matthijs Glastra
Matthijs Glastra
Chief Executive Officer
Date: February 25, 2025

106
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the dates indicated.
Novanta Inc. (Registrant)
Name
Title
Date
/s/ Matthijs Glastra
Chair of the Board of Directors, Chief Executive
Officer
February 25, 2025
Matthijs Glastra
/s/ Robert J. Buckley
Chief Financial Officer
February 25, 2025
Robert J. Buckley
/s/ John J. Burke
Chief Accounting Officer
February 25, 2025
John J. Burke
/s/ Lonny J. Carpenter
Lead Director
February 25, 2025
Lonny J. Carpenter
/s/ Barbara B. Hulit
Director
February 25, 2025
Barbara B. Hulit
/s/ R. Matthew Johnson
Director
February 25, 2025
R. Matthew Johnson
/s/ Mary Katherine Ladone
Director
February 25, 2025
Mary Katherine Ladone
/s/ Maxine L. Mauricio
Director
February 25, 2025
Maxine L. Mauricio
/s/ Thomas N. Secor
Director
February 25, 2025
Thomas N. Secor
/s/ Darlene J.S. Solomon
Director
February 25, 2025
Darlene J.S. Solomon
/s/ Frank A. Wilson
Director
February 25, 2025
Frank A. Wilson

 
 
107 
 
FACTORS AFFECTING FUTURE PERFORMANCE 
Certain statements in this release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and are based on current 
expectations and assumptions that are subject to risks and uncertainties. All statements contained in this Annual Report that do not relate to matters of historical fact 
should be considered forward-looking statements, and are generally identified by words such as “expect,” “intend,” “anticipate,” “estimate,” “believe,” “future,” “could,” 
“should,” “plan,” “aim,” and other similar expressions. These forward-looking statements include, but are not limited to, statements regarding anticipated financial 
performance and financial position; expectations regarding our end markets and market position; our competitive position, including our positioning for long-term growth; 
expectations regarding our ability to navigate difficult macroeconomic conditions and other statements that are not historical facts. These forward-looking statements are 
neither promises nor guarantees, but involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking 
statements. Our actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including, but not limited to, the 
following: economic and political conditions and the effects of these conditions on our customers’ businesses, capital expenditures and level of business activities; our 
dependence upon our ability to respond to fluctuations in product demand; our ability to continuously innovate, to introduce new products in a timely manner, and to 
manage transitions to new product innovations effectively; customer order timing and other similar factors; disruptions or breaches in security of our or our third-party 
providers’ information technology systems; risks associated with our operations in foreign countries; our increased use of outsourcing in foreign countries; risks associated 
with increased outsourcing of components manufacturing; our exposure to increased tariffs, trade restrictions or taxes on our products; our ability to contain or reduce 
costs; violations of our intellectual property rights and our ability to protect our intellectual property against infringement by third parties; risk of losing our competitive 
advantage; the loss of sales, or significant reduction in orders from, any major customers; our failure to successfully integrate recent and future acquisitions into our 
business; our ability to attract and retain key personnel; our restructuring and realignment activities; product defects or problems integrating our products with other 
vendors’ products; disruptions in the supply of certain key components and other goods from our suppliers; our failure to accurately forecast component and raw material 
requirements leading to additional costs and significant delays in shipments; production difficulties and product delivery delays or disruptions; our exposure to extensive 
medical device regulations, which may impede or hinder the approval, certification or sale of our products and, in some cases, may ultimately result in an inability to 
obtain approval or certification of certain products or may result in the recall or seizure of previously approved or certified products; potential penalties for violating 
foreign and U.S. federal and state healthcare laws and regulations; impact of healthcare industry cost containment and healthcare reform measures; changes in 
governmental regulations related to our business or products; actual or perceived failures to comply with applicable data protection, privacy and security laws, regulations, 
standards, and other requirements; our failure to implement new information technology systems successfully; changes in foreign currency rates; our failure to realize the 
full value of our intangible assets; our reliance on original equipment manufacturer customers; increasing scrutiny and changing expectations from investors, customers, 
governments and other stakeholders and third parties with respect to corporate sustainability policies and practices; the effects of climate change and related regulatory 
responses; our exposure to the credit risk of some of our customers and in weakened markets; being subject to U.S. federal income taxation even though we are a non-
U.S. corporation; changes in tax laws and fluctuations in our effective tax rates; any need for additional capital to adequately respond to business challenges or 
opportunities and repay or refinance our existing indebtedness, which may not be available on acceptable terms or at all; our existing indebtedness limiting our ability to 
engage in certain activities; volatility in the market price for our common shares; and our failure to maintain appropriate internal controls in the future. Other important 
risk factors that could affect the outcome of the events set forth in these statements and that could affect the Company’s operating results and financial condition are 
discussed in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, as updated by our subsequent filings with the Securities 
and Exchange Commission. Such statements are based on the Company’s beliefs and assumptions and on information currently available to the Company. The Company 
disclaims any obligation to publicly update or revise any such forward-looking statements as a result of developments occurring after the date of this document except as 
required by law. 
 
FORM 10-K 
This Annual Report includes a copy of our Annual Report on Form 10-K for the year ended December 31, 2024, excluding exhibits, as filed with the SEC and available 
on our website at https://www.novanta.com. We will, upon written request and payment of an appropriate processing fee, provide our shareholders with copies of the 
exhibits to our Annual Report on Form 10-K. Please send your request to Novanta Inc., 125 Middlesex Turnpike, Bedford, MA 01730, Attention: Investor Relations. 
_______________________________________________________________________________________________________________________________________ 
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES 
This Annual Report contains the non-GAAP financial measures of Adjusted EBITDA, Organic Revenue Growth and Adjusted Diluted EPS. A tabular reconciliation of 
these non-GAAP financial measures to the most comparable GAAP financial measures are set forth below. 
 
 
 
Adjusted EBITDA (Non-GAAP): (1) 
   
Year Ended December 31, 
  
  
   
2024 
    
2023 
  
 (in thousands of U.S. dollars) 
   
(Unaudited) 
  
  (Unaudited) 
  
 Net Income (GAAP) 
   $ 
64,087
   $ 
72,878
  
Interest (income) expense, net  
    
31,489      
25,818    
Income tax provision 
    
14,979      
10,870    
Depreciation and amortization 
    
55,563      
46,612    
Share-based compensation 
    
23,307      
25,588    
Restructuring and acquisition related costs 
    
13,714      
12,819    
Acquisition inventory fair value adjustments 
   
2,777     
—
 
Inventory related charges associated with a product line closure 
  
2,493    
473
 
Officer transition costs 
  
1,411    
—
 
Other non-operating income (expense), net 
    
29      
1,171
  
Adjusted EBITDA (non-GAAP) 
   $ 
209,849     $ 
196,229    
Adjusted EBITDA Margin (non-GAAP) 
  
22.1 %  
22.3 % 
(1) 
The Company defines Adjusted EBITDA as income before deducting interest (income) expense, income taxes provision (benefit), depreciation, amortization, non-cash share-based compensation, 
restructuring, acquisition and divestiture related costs, acquisition fair value adjustment, inventory related charges associated with product line closures, officer transition costs, other non-operating 
income (expense) items, including foreign exchange gains (losses), and net periodic pension costs of the Company’s frozen U.K. defined benefit pension plan. The Company defines Adjusted 
EBITDA Margin as Adjusted EBITDA as a percentage of Revenue. The Company believes Adjusted EBITDA and Adjusted EBITDA Margin provide useful and supplementary information to 
investors regarding the operating results of the Company because of the significant changes that have occurred outside of the Company’s day-to-day business in accordance with the execution of 
the Company’s strategy. This strategy includes streamlining the Company’s existing operations through site and functional consolidations, strategic divestitures and product line closures, expanding 
the Company’s business through significant internal investments, and broadening the Company’s product and service offerings through acquisition of innovative and complementary technologies 
and solutions. The financial impact of certain elements of these activities, particularly acquisitions, divestitures, and site and functional restructurings, is often large relative to the Company’s 
overall financial performance and can adversely affect the comparability of its operating results and investors’ ability to analyze the business from period to period. Adjusted EBITDA is used by 
management to evaluate operating performance, communicate financial results to the Board of Directors, benchmark results against historical performance and the performance of peers, and 
evaluate investment opportunities, including acquisitions and divestitures. In addition, Adjusted EBITDA is used as one of the performance metrics to determine bonus payments for senior 
management and employees and to measure the payout of certain performance-based restricted stock units. Accordingly, the Company believes that these non-GAAP measures provide greater 
transparency and insight into management’s method of analysis. In evaluating Adjusted EBITDA, you should be aware that, in the future, the Company may incur expenses that are the same as, 
or similar to, some of the adjustments listed above.  

108
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Continued)
Organic Revenue Growth (Non-GAAP): (1)
Year Ended December 31, 2024
Compared to
Year Ended December 31, 2023
(Unaudited)
Reported Revenue Growth (GAAP)
7.7%
Less: Change attributable to acquisitions
9.4%
Plus: Change due to foreign currency
0.1%
Organic Revenue Growth (non-GAAP)
(1.6)%
(1)
The Company defines the term “organic revenue” as revenue excluding the impact from business acquisitions, divestitures, product line discontinuations, and the effect of foreign currency
translation. The Company uses the related term “organic revenue growth” to refer to the financial performance metric of comparing current period organic revenue with the reported revenue of
the corresponding period in the prior year. The Company believes that this non-GAAP financial measure, when taken together with our GAAP financial measures, allows the Company and its
investors to better measure the Company’s performance and evaluate long-term performance trends. Organic revenue growth also facilitates easier comparisons of the Company’s performance
with prior and future periods and relative comparisons to its peers. The Company excludes the effect of foreign currency translation from these measures because foreign currency translation is
subject to volatility and can obscure underlying business trends. The Company excludes the effect of acquisitions and divestitures because these activities can vary dramatically between
reporting periods and between the Company and its peers, which the Company believes makes comparisons of long-term performance trends difficult for management and investors. Organic
Revenue Growth is also used as a performance metric to determine bonus payments for senior management and employees.
Adjusted Diluted EPS (Non-GAAP): (1)
Year Ended December 31,
2024
2023
(in thousands of U.S. dollars except per share amounts)
(Unaudited)
(Unaudited)
Net Income (GAAP)
$
64,087
$
72,878
Diluted EPS (GAAP)
$
1.77
$
2.02
Non-GAAP adjustments:
Amortization of intangible assets (2)
40,567
32,595
Restructuring costs (3)
10,486
11,814
Acquisition related costs (3)
3,223
1,000
Acquisition fair value adjustments (2)
2,777
—
Inventory related charges associated with a product line closure(4)
2,493
473
Other non-recurring cost
—
241
Officer transition costs(4)
1,411
—
Foreign exchange transaction (gains) losses, net (5)
(413)
255
Total Non-GAAP adjustments before income taxes
60,544
46,378
Tax effect of non-GAAP adjustments (6)
14,480
9,843
Non-GAAP tax adjustments (6)
(1,139)
422
Adjusted Net Income (Non-GAAP)
$
111,290
$
108,991
Adjusted Diluted EPS (Non-GAAP)
$
3.08
$
3.02
Weighted-average shares outstanding - Diluted
36,124
36,031
(1)
The Company believes Adjusted Diluted EPS provides useful and supplementary information to investors regarding the operating performance of the Company because Adjusted Diluted EPS is
used by management to evaluate operating performance, communicate financial results to the Board of Directors, and benchmark results against historical performance and the performance of
peers. The Company may also use Adjusted Diluted EPS as a performance metric for certain performance-based restricted stock units issued to executives. Accordingly, the Company believes
this non-GAAP measure provides greater transparency and insight into management’s method of analysis. In evaluating Adjusted Diluted EPS, you should be aware that in the future the Company
may incur expenses that are the same as, or similar to, some of the adjustments listed above.
(2)
Amortization of acquired intangible assets and acquisition fair value adjustments are excluded from Adjusted Diluted EPS because (i) these amounts are non-cash; (ii) the Company cannot
influence the timing and amount of future expense recognition; and (iii) excluding such expenses provides investors and management better visibility into the components of operating costs.
(3)
These amounts relate to the Company’s restructuring programs, business acquisitions, divestitures and related activities. Such expenses are excluded from the calculation of Adjusted Diluted EPS
due to the significant changes that have occurred outside of the Company’s day-to-day business as a result of the execution of the Company’s strategy. The financial impact of certain elements of
these activities, particularly acquisitions, divestures, and site and functional restructurings, is often large relative to the Company’s overall financial performance and can adversely affect the
comparability of its operating results and investors’ ability to analyze the business from period to period.
(4)
The Company excludes inventory related charges associated with a product line closure and officer transition costs as they occurred outside of the Company’s day-to-day business.
(5)
The Company excludes foreign exchange transaction gains (losses) as the Company cannot fully influence the timing and amount of foreign currency transaction gains (losses).
(6)
The Company excludes significant discrete income tax expenses (benefits) related to releases of valuation allowances, benefits or expenses associated with the completion of tax audits, effects of
changes in tax laws, effects of acquisition related tax planning actions on our effective tax rate, and the income tax effect of non-GAAP adjustments above.
Non-GAAP financial measures should not be considered as substitutes for, or superior to, measures of financial performance prepared in accordance with GAAP. They
are limited in value because they exclude charges that have a material effect on the Company’s reported results and, therefore, should not be relied upon as the sole
financial measures to evaluate the Company’s financial results. The non-GAAP financial measures are meant to supplement, and to be viewed in conjunction with,
GAAP financial measures.

CORPORATE INFORMATION
SHAREHOLDER INFORMATION
EXECUTIVE OFFICERS
CORPORATE HEADQUARTERS
Matthijs Glastra
Novanta Inc.
Chief Executive Officer, Chair of the Board of Directors
125 Middlesex Turnpike
Bedford, MA 01730
Robert J. Buckley
U.S.A.
Chief Financial Officer
Phone: 1-781-266-5700
Fax: 1-781-266-5114
Michele D. Welsh
General Counsel and Corporate Secretary
WEBSITE
https://www.novanta.com
BOARD OF DIRECTORS
Matthijs Glastra
Chair of the Board of Directors, Novanta Inc.
Lonny J. Carpenter, Lead Director
Former Group President, Stryker Corporation
Barbara B. Hulit
Former Senior Vice President of Fortive Corporation
R. Matthew Johnson
President and Chief Executive Officer of Silicon Labs
Mary Katherine Ladone
Former Corporate Officer and Senior Vice President of Hill-
Rom Holdings, Inc.
Maxine L. Mauricio
Executive Vice President, Chief Administrative Officer,
General Counsel and Secretary, EMCOR Group, Inc.
Thomas N. Secor
Managing Director, Morningside Heights Capital,
an investment firm
Darlene J.S. Solomon, Ph.D.
Senior Vice President and Chief Technology Officer,
Agilent Technologies, Inc.
Frank A. Wilson
Former Chief Financial Officer and Senior Vice President,
PerkinElmer, Inc.
ANNUAL MEETING OF SHAREHOLDERS
to be held virtually at:
3:00 p.m. (ET), Thursday, May 29, 2025
www.virtualshareholdermeeting.com/NOVT2025
An Annual Report, a Management Proxy Circular and a
form of Proxy will be furnished to each shareholder as of the
record date of April 15, 2025.
AUDITORS
Deloitte & Touche LLP
(beginning with fiscal year 2024)
115 Federal Street
Boston, MA 02110
TRANSFER AGENT
Computershare Investor Services
100 University Ave.
8th Floor, North Tower
Toronto, Ontario, M5J 2Y1, Canada
Phone: 1-800-564-6253
Fax: 1-888-453-0330
service@computershare.com
STOCK EXCHANGE
Novanta Inc.’s common shares are listed and traded on the
Nasdaq Global Select Market under the ticker symbol
“NOVT”.