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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________________________________________________________ 
FORM 10-Q
_________________________________________________________________________________ 
(Mark One)
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31,September 30, 2020
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 Number 001-34652
_________________________________________________________________________________ 
SENSATA TECHNOLOGIES HOLDING PLC
(Exact name of registrant as specified in its charter)
_________________________________________________________________________________ 
England and Wales98-1386780
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
529 Pleasant Street
Attleboro,, Massachusetts,, 02703,, United States
(Address of principal executive offices, including zip code))
+1 (508)236 3800
(Registrant's telephone number, including area code)
Not applicable
(Former name, former address and former fiscal year, if changed since last report)
_____________________________________ 
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of exchange on which registered
Ordinary Shares - nominal value €0.01 per shareSTNew York Stock Exchange
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☐
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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of AprilOctober 15, 2020, 157,161,723157,309,612 ordinary shares were outstanding.


Table of Contents
TABLE OF CONTENTS

PART I
Item 1.
3
4
5
6
7
8
Item 2.
1923
Item 3.
2633
Item 4.
2733
PART II 
Item 1.
2834
Item 1A.
2834
Item 2.
2935
Item 3.
2935
Item 5.6.
3036
Item 6.
3137
Signatures
32
2
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PART I—FINANCIAL INFORMATION

Item 1.Financial Statements.
Item 1.Financial Statements.
SENSATA TECHNOLOGIES HOLDING PLC
Condensed Consolidated Balance Sheets
(In thousands, except per share amounts)
(unaudited)
March 31,
2020		 December 31,
2019		September 30,
2020		December 31,
2019
Assets   Assets
Current assets:   Current assets:
Cash and cash equivalents$802,971
 $774,119
Cash and cash equivalents$1,610,191 $774,119 
Accounts receivable, net of allowances of $15,832 and $15,129 as of March 31, 2020 and December 31, 2019, respectively536,416
 557,874
Accounts receivable, net of allowances of $17,151 and $15,129 as of September 30, 2020 and December 31, 2019, respectivelyAccounts receivable, net of allowances of $17,151 and $15,129 as of September 30, 2020 and December 31, 2019, respectively565,184 557,874 
Inventories514,274
 506,678
Inventories438,188 506,678 
Prepaid expenses and other current assets115,887
 126,981
Prepaid expenses and other current assets100,316 126,981 
Total current assets1,969,548
 1,965,652
Total current assets2,713,879 1,965,652 
Property, plant and equipment, net824,553
 830,998
Property, plant and equipment, net807,092 830,998 
Goodwill3,093,598
 3,093,598
Goodwill3,117,569 3,093,598 
Other intangible assets, net of accumulated amortization of $2,072,227 and $2,039,436 as of March 31, 2020 and December 31, 2019, respectively738,244
 770,904
Other intangible assets, net of accumulated amortization of $2,137,916 and $2,039,436 as of September 30, 2020 and December 31, 2019, respectivelyOther intangible assets, net of accumulated amortization of $2,137,916 and $2,039,436 as of September 30, 2020 and December 31, 2019, respectively715,797 770,904 
Deferred income tax assets27,293
 21,150
Deferred income tax assets29,714 21,150 
Other assets159,582
 152,217
Other assets175,443 152,217 
Total assets$6,812,818
 $6,834,519
Total assets$7,559,494 $6,834,519 
Liabilities and shareholders’ equity   Liabilities and shareholders’ equity
Current liabilities:   Current liabilities:
Current portion of long-term debt, finance lease and other financing obligations$7,095
 $6,918
Current portion of long-term debt, finance lease and other financing obligations$7,049 $6,918 
Accounts payable345,787
 376,968
Accounts payable319,424 376,968 
Income taxes payable19,390
 35,234
Income taxes payable11,428 35,234 
Accrued expenses and other current liabilities248,789
 215,626
Accrued expenses and other current liabilities288,514 215,626 
Total current liabilities621,061
 634,746
Total current liabilities626,415 634,746 
Deferred income tax liabilities247,960
 251,033
Deferred income tax liabilities241,554 251,033 
Pension and other post-retirement benefit obligations33,716
 36,100
Pension and other post-retirement benefit obligations31,090 36,100 
Finance lease and other financing obligations, less current portion28,280
 28,810
Finance lease and other financing obligations, less current portion28,360 28,810 
Long-term debt, net3,220,359
 3,219,885
Long-term debt, net3,963,076 3,219,885 
Other long-term liabilities123,645
 90,190
Other long-term liabilities94,355 90,190 
Total liabilities4,275,021
 4,260,764
Total liabilities4,984,850 4,260,764 
Commitments and contingencies (Note 12)

 

Commitments and contingencies (Note 12)
Shareholders’ equity:   Shareholders’ equity:
Ordinary shares, €0.01 nominal value per share, 177,069 shares authorized, and 172,596 and 172,561 shares issued, as of March 31, 2020 and December 31, 2019, respectively2,212
 2,212
Treasury shares, at cost, 15,631 and 14,733 shares as of March 31, 2020 and December 31, 2019, respectively(784,596) (749,421)
Ordinary shares, €0.01 nominal value per share, 177,069 shares authorized, and 172,875 and 172,561 shares issued, as of September 30, 2020 and December 31, 2019, respectivelyOrdinary shares, €0.01 nominal value per share, 177,069 shares authorized, and 172,875 and 172,561 shares issued, as of September 30, 2020 and December 31, 2019, respectively2,216 2,212 
Treasury shares, at cost, 15,631 and 14,733 shares as of September 30, 2020 and December 31, 2019, respectivelyTreasury shares, at cost, 15,631 and 14,733 shares as of September 30, 2020 and December 31, 2019, respectively(784,596)(749,421)
Additional paid-in capital1,731,884
 1,725,091
Additional paid-in capital1,741,538 1,725,091 
Retained earnings1,624,773
 1,616,357
Retained earnings1,656,639 1,616,357 
Accumulated other comprehensive loss(36,476) (20,484)Accumulated other comprehensive loss(41,153)(20,484)
Total shareholders’ equity2,537,797
 2,573,755
Total shareholders’ equity2,574,644 2,573,755 
Total liabilities and shareholders’ equity$6,812,818
 $6,834,519
Total liabilities and shareholders’ equity$7,559,494 $6,834,519 

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENSATA TECHNOLOGIES HOLDING PLC
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(unaudited)
 
 For the three months endedFor the nine months ended
 September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Net revenue$788,313 $849,715 $2,139,087 $2,603,940 
Operating costs and expenses:
Cost of revenue530,255 554,910 1,509,104 1,710,951 
Research and development33,423 38,189 98,115 109,970 
Selling, general and administrative75,747 68,158 217,698 210,733 
Amortization of intangible assets32,562 35,905 98,397 108,079 
Restructuring and other charges, net(10,519)6,421 32,197 28,040 
Total operating costs and expenses661,468 703,583 1,955,511 2,167,773 
Operating income126,845 146,132 183,576 436,167 
Interest expense, net(44,129)(39,556)(124,340)(118,417)
Other, net9,194 (7,560)(1,511)(7,925)
Income before taxes91,910 99,016 57,725 309,825 
Provision for income taxes15,181 28,341 15,106 80,649 
Net income$76,729 $70,675 $42,619 $229,176 
Basic net income per share$0.49 $0.44 $0.27 $1.42 
Diluted net income per share$0.49 $0.44 $0.27 $1.41 
 For the three months ended
 March 31, 2020 March 31, 2019
Net revenue$774,269
 $870,499
Operating costs and expenses:   
Cost of revenue566,406
 580,806
Research and development34,453
 35,096
Selling, general and administrative77,221
 70,549
Amortization of intangible assets33,092
 36,143
Restructuring and other charges, net4,498
 5,309
Total operating costs and expenses715,670
 727,903
Operating income58,599
 142,596
Interest expense, net(39,403) (39,253)
Other, net(12,281) 3,189
Income before taxes6,915
 106,532
(Benefit from)/provision for income taxes(1,516) 21,467
Net income$8,431
 $85,065
Basic net income per share:$0.05
 $0.52
Diluted net income per share:$0.05
 $0.52

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENSATA TECHNOLOGIES HOLDING PLC
Condensed Consolidated Statements of Comprehensive (Loss)/Income
(In thousands)
(unaudited)
 
 For the three months endedFor the nine months ended
 September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Net income$76,729 $70,675 $42,619 $229,176 
Other comprehensive (loss)/income:
Cash flow hedges(2,197)6,917 (26,698)12,331 
Defined benefit and retiree healthcare plans1,015 83 6,029 249 
Other comprehensive (loss)/income(1,182)7,000 (20,669)12,580 
Comprehensive income$75,547 $77,675 $21,950 $241,756 
 For the three months ended
 March 31, 2020 March 31, 2019
Net income$8,431
 $85,065
Other comprehensive (loss)/income, net of tax:   
Cash flow hedges(19,334) 10,060
Defined benefit and retiree healthcare plans3,342
 83
Other comprehensive (loss)/income(15,992) 10,143
Comprehensive (loss)/income$(7,561) $95,208

The accompanying notes are an integral part of these condensed consolidated financial statements.

5
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SENSATA TECHNOLOGIES HOLDING PLC
Condensed Consolidated Statements of Cash Flows
(In thousands)
(unaudited)
 For the nine months ended
 September 30, 2020September 30, 2019
Cash flows from operating activities:
Net Income$42,619 $229,176 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation94,216 84,354 
Amortization of debt issuance costs5,026 5,573 
Share-based compensation14,212 15,188 
Loss on debt financing0 4,364 
Amortization of intangible assets98,397 108,079 
Deferred income taxes(11,600)20,313 
Unrealized loss on derivative instruments and other5,876 23,545 
Changes in operating assets and liabilities, net of the effects of acquisitions:
Accounts receivable, net(5,205)(12,119)
Inventories71,207 (7,192)
Prepaid expenses and other current assets15,689 4,281 
Accounts payable and accrued expenses(10,939)(40,092)
Income taxes payable(23,806)2,028 
Other(2,354)(3,971)
Net cash provided by operating activities293,338 433,527 
Cash flows from investing activities:
Acquisitions, net of cash received(64,452)(32,315)
Additions to property, plant and equipment and capitalized software(79,939)(123,206)
Investment in debt and equity securities(24,794)(9,950)
Other10,717 4,947 
Net cash used in investing activities(158,468)(160,524)
Cash flows from financing activities:
Proceeds from exercise of stock options and issuance of ordinary shares2,237 10,309 
Payment of employee restricted stock tax withholdings(2,335)(6,953)
Proceeds from borrowings on debt1,150,000 450,000 
Payments on debt(406,568)(461,190)
Payments to repurchase ordinary shares(35,175)(265,846)
Payments of debt and equity issuance costs(6,957)(7,770)
Net cash provided by/(used in) financing activities701,202 (281,450)
Net change in cash and cash equivalents836,072 (8,447)
Cash and cash equivalents, beginning of period774,119 729,833 
Cash and cash equivalents, end of period$1,610,191 $721,386 
 For the three months ended
 March 31, 2020 March 31, 2019
Cash flows from operating activities:   
Net income$8,431
 $85,065
Adjustments to reconcile net income to net cash provided by operating activities:   
Depreciation34,679
 27,208
Amortization of debt issuance costs1,631
 1,836
Share-based compensation6,084
 5,940
Amortization of intangible assets33,092
 36,143
Deferred income taxes(4,100) 5,113
Loss on litigation judgment29,200
 —
Unrealized loss on derivative instruments and other11,040
 6,204
Changes in operating assets and liabilities, net of the effects of acquisitions:   
Accounts receivable, net21,458
 (51,237)
Inventories(7,596) 8,183
Prepaid expenses and other current assets5,625
 3,028
Accounts payable and accrued expenses(19,962) (14,917)
Income taxes payable(15,844) (781)
Other(5,194) 908
Net cash provided by operating activities98,544
 112,693
Cash flows from investing activities:   
Acquisitions, net of cash received—
 (1,681)
Additions to property, plant and equipment and capitalized software(29,547) (41,690)
Other(3,289) 1,000
Net cash used in investing activities(32,836) (42,371)
Cash flows from financing activities:   
Proceeds from exercise of stock options and issuance of ordinary shares709
 5,813
Payment of employee restricted stock tax withholdings(15) (275)
Payments on debt(2,375) (4,157)
Payments to repurchase ordinary shares(35,175) (150,749)
Payments of debt and equity issuance costs—
 (1,269)
Net cash used in financing activities(36,856) (150,637)
Net change in cash and cash equivalents28,852
 (80,315)
Cash and cash equivalents, beginning of period774,119
 729,833
Cash and cash equivalents, end of period$802,971
 $649,518

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENSATA TECHNOLOGIES HOLDING PLC
Condensed Consolidated Statements of Changes in Shareholders' Equity
(In thousands)
(unaudited) 
 Ordinary SharesTreasury SharesAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossTotal Shareholders’ Equity
 NumberAmountNumberAmount
Balance as of June 30, 2020172,844 $2,215 (15,631)$(784,596)$1,735,826 $1,579,931 $(39,971)$2,493,405 
Surrender of shares for tax withholding— — 0 (21)— — — (21)
Stock options exercised29 1 — — 1,090 — — 1,091 
Vesting of restricted securities2 0 — — — 0 — 0 
Retirement of ordinary shares0 0 0 21 — (21)— 0 
Share-based compensation— — — — 4,622 — — 4,622 
Net income— — — — — 76,729 — 76,729 
Other comprehensive loss— — — — — — (1,182)(1,182)
Balance as of September 30, 2020172,875 $2,216 (15,631)$(784,596)$1,741,538 $1,656,639 $(41,153)$2,574,644 
Ordinary Shares Treasury Shares 
Additional
Paid-In
Capital
 Retained Earnings 
Accumulated
Other
Comprehensive
Loss
 
Total
Shareholders’
Equity
 Ordinary SharesTreasury SharesAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossTotal Shareholders’ Equity
Number Amount Number Amount  NumberAmountNumberAmount
Balance as of December 31, 2019172,561
 $2,212
 (14,733) $(749,421) $1,725,091
 $1,616,357
 $(20,484) $2,573,755
Balance as of December 31, 2019172,561 $2,212 (14,733)$(749,421)$1,725,091 $1,616,357 $(20,484)$2,573,755 
Surrender of shares for tax withholding—
 —
 —
 (15) —
 —
 —
 (15)Surrender of shares for tax withholding— — (83)(2,335)— — — (2,335)
Stock options exercised34
 —
 —
 —
 709
 —
 —
 709
Stock options exercised84 2 — — 2,235 — — 2,237 
Vesting of restricted securities1
 —
 —
 —
 —
 —
 —
 —
Vesting of restricted securities313 3 — — — (3)— 0 
Repurchase of ordinary shares—
 —
 (898) (35,175) —
 —
 —
 (35,175)Repurchase of ordinary shares— — (898)(35,175)— — — (35,175)
Retirement of ordinary shares—
 —
 —
 15
 —
 (15) —
 —
Retirement of ordinary shares(83)(1)83 2,335 — (2,334)— 0 
Share-based compensation—
 —
 —
 —
 6,084
 —
 —
 6,084
Share-based compensation— — — — 14,212 — — 14,212 
Net income—
 —
 —
 —
 —
 8,431
 —
 8,431
Net income— — — — — 42,619 — 42,619 
Other comprehensive loss—
 —
 —
 —
 —
 —
 (15,992) (15,992)Other comprehensive loss— — — — — — (20,669)(20,669)
Balance as of March 31, 2020172,596
 $2,212
 (15,631) $(784,596) $1,731,884
 $1,624,773
 $(36,476) $2,537,797
Balance as of September 30, 2020Balance as of September 30, 2020172,875 $2,216 (15,631)$(784,596)$1,741,538 $1,656,639 $(41,153)$2,574,644 
 Ordinary SharesTreasury SharesAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossTotal Shareholders’ Equity
 NumberAmountNumberAmount
Balance as of June 30, 2019172,325 $2,209 (10,986)$(567,615)$1,710,711 $1,492,356 $(20,598)$2,617,063 
Surrender of shares for tax withholding— — (4)(175)— — — (175)
Stock options exercised93 2 — — 3,208 — — 3,210 
Vesting of restricted securities13 0 — — — 0 — 0 
Repurchase of ordinary shares— — (2,098)(97,648)— — — (97,648)
Retirement of ordinary shares(4)0 4 175 — (175)— 0 
Share-based compensation— — — — 2,763 — — 2,763 
Net income— — — — — 70,675 — 70,675 
Other comprehensive income— — — — — — 7,000 7,000 
Balance as of September 30, 2019172,427 $2,211 (13,084)$(665,263)$1,716,682 $1,562,856 $(13,598)$2,602,888 
Ordinary Shares Treasury Shares 
Additional
Paid-In
Capital
 Retained Earnings 
Accumulated
Other
Comprehensive
Loss
 
Total
Shareholders’
Equity
 Ordinary SharesTreasury SharesAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossTotal Shareholders’ Equity
Number Amount Number Amount  NumberAmountNumberAmount
Balance as of December 31, 2018171,719
 $2,203
 (7,571) $(399,417) $1,691,190
 $1,340,636
 $(26,178) $2,608,434
Balance as of December 31, 2018171,719 $2,203 (7,571)$(399,417)$1,691,190 $1,340,636 $(26,178)$2,608,434 
Surrender of shares for tax withholding—
 —
 (6) (275) —
 —
 —
 (275)Surrender of shares for tax withholding— — (148)(6,953)— — — (6,953)
Stock options exercised248
 3
 —
 —
 5,810
 —
 —
 5,813
Stock options exercised405 5 — — 10,304 — — 10,309 
Vesting of restricted securities26
 —
 —
 —
 —
 —
 —
 —
Vesting of restricted securities451 5 — — — (5)— 0 
Repurchase of ordinary shares—
 —
 (3,036) (150,749) —
 —
 —
 (150,749)Repurchase of ordinary shares— — (5,513)(265,846)— — — (265,846)
Retirement of ordinary shares(6) —
 6
 275
 —
 (275) —
 —
Retirement of ordinary shares(148)(2)148 6,953 — (6,951)— 0 
Share-based compensation—
 —
 —
 —
 5,940
 —
 —
 5,940
Share-based compensation— — — — 15,188 — — 15,188 
Net income—
 —
 —
 —
 —
 85,065
 —
 85,065
Net income— — — — — 229,176 — 229,176 
Other comprehensive income—
 —
 —
 —
 —
 —
 10,143
 10,143
Other comprehensive income— — — — — — 12,580 12,580 
Balance as of March 31, 2019171,987
 $2,206
 (10,607) $(550,166) $1,702,940
 $1,425,426
 $(16,035) $2,564,371
Balance as of September 30, 2019Balance as of September 30, 2019172,427 $2,211 (13,084)$(665,263)$1,716,682 $1,562,856 $(13,598)$2,602,888 

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENSATA TECHNOLOGIES HOLDING PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. Basis of Presentation
The accompanying unaudited condensed consolidated financial statements reflect the financial position, results of operations, comprehensive (loss)/income, cash flows, and changes in shareholders' equity of Sensata Technologies Holding plc, a public limited company incorporated under the laws of England and Wales, and its wholly-owned subsidiaries, collectively referred to as the "Company," "Sensata," "we," "our," or "us."
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States ("U.S.") generally accepted accounting principles ("GAAP") for interim financial information and the instructions to Form 10-Q. Accordingly, these interim financial statements do not include all of the information and note disclosures required by U.S. GAAP for complete financial statements. The accompanying financial information reflects all normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the interim period results. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019.
All U.S. dollar ("USD") and share amounts presented, except per share amounts, are stated in thousands, unless otherwise indicated.
Certain reclassifications have been made to prior periods to conform to current period presentation.
2. New Accounting Standards
There are no recently issued accounting standards that have been adopted in the current period or will be adopted in future periods that have had or are expected to have a material impact on our consolidated financial position or results of operations.
3. Revenue Recognition
The following table presents net revenue disaggregated by segment and end market for the three months ended March 31,September 30, 2020 and 2019:
  For the three months ended March 31, 2020 For the three months ended March 31, 2019
  Performance Sensing Sensing Solutions Total Performance Sensing Sensing Solutions Total
Automotive $437,703
 $8,236
 $445,939
 $492,015
 $11,428
 $503,443
HVOR (1)
 130,986
 —
 130,986
 148,013
 —
 148,013
Industrial —
 80,599
 80,599
 —
 92,641
 92,641
Appliance and HVAC (2)
 —
 45,396
 45,396
 —
 51,704
 51,704
Aerospace —
 42,124
 42,124
 —
 42,979
 42,979
Other —
 29,225
 29,225
 —
 31,719
 31,719
Total $568,689
 $205,580
 $774,269
 $640,028
 $230,471
 $870,499

For the three months ended September 30, 2020For the three months ended September 30, 2019
Performance SensingSensing SolutionsTotalPerformance SensingSensing SolutionsTotal
Automotive$456,200 $7,801 $464,001 $493,675 $10,738 $504,413 
HVOR (1)
124,736 0 124,736 134,918 0 134,918 
Industrial0 87,174 87,174 0 83,718 83,718 
Appliance and HVAC (2)
0 47,618 47,618 0 49,724 49,724 
Aerospace0 31,740 31,740 0 41,962 41,962 
Other0 33,044 33,044 0 34,980 34,980 
Total$580,936 $207,377 $788,313 $628,593 $221,122 $849,715 
________________________
(1)    Heavy vehicle and off-road
(2)    Heating, ventilation and air conditioning
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The following table presents net revenue disaggregated by segment and end market for the nine months ended September 30, 2020 and 2019:
For the nine months ended September 30, 2020For the nine months ended September 30, 2019
Performance SensingSensing SolutionsTotalPerformance SensingSensing SolutionsTotal
Automotive$1,180,402 $23,316 $1,203,718 $1,483,986 $32,838 $1,516,824 
HVOR354,430 0 354,430 429,151 0 429,151 
Industrial0 247,037 247,037 0 272,177 272,177 
Appliance and HVAC0 136,703 136,703 0 157,260 157,260 
Aerospace0 101,057 101,057 0 129,843 129,843 
Other0 96,142 96,142 0 98,685 98,685 
Total$1,534,832 $604,255 $2,139,087 $1,913,137 $690,803 $2,603,940 
4. Share-Based Payment Plans
The following table presents the components of non-cash compensation expense related to our equity awards for the three and nine months ended March 31,September 30, 2020 and 2019.2019:
 For the three months endedFor the nine months ended
 September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Stock options$179 $1,499 $2,721 $4,987 
Restricted securities4,443 1,264 11,491 10,201 
Share-based compensation expense$4,622 $2,763 $14,212 $15,188 
 For the three months ended
 March 31, 2020 March 31, 2019
Stock options$2,489
 $1,524
Restricted securities3,595
 4,416
Share-based compensation expense$6,084
 $5,940
Equity Awards
We granted the following restricted stock units ("RSUs" and each, an "RSU") and performance-based restricted stock units ("PRSUs" and each, a "PRSU") under the Sensata Technologies Holding plc First Amended and Restated 2010 Equity Incentive Plan during the nine months ended September 30, 2020:
Awards Granted To:Type of AwardNumber of Units Granted (in thousands)Percentage of PRSUs Awarded That May VestWeighted- Average Grant Date Fair Value
Various executives and employees
RSU (1)
10 N/A$36.67 
Directors
RSU (1)
39 N/A$36.45 
Various executives and employees
RSU (2)
748 N/A$28.37 
Various executives and employees
PRSU (3)
401 0.0% - 172.5%$28.22 
__________________________
(1)    
TheseRSUs generally cliff vest between one year and three years from the grant date (various dates between April 2021 and March 2023).

(2)    Beginning in April 2020, we began granting RSUs that vest ratably over three years, one-third per year beginning on the first anniversary of the grant date. These RSUs will fully vest on various dates between April 2023 and September 2023.

(3)    ThesePRSUs vest on various dates between April 2023 and September 2023. The number of units that ultimately vest is dependent on the achievement of certain performance criteria.
5. Restructuring and Other Charges, Net
During the three months ended June 30, 2020, we analyzed the potential long-term impact of the global financial and health crisis caused by the coronavirus pandemic ("COVID-19") on our business and, as a result, committed to a plan to reorganize our business (the “Q2 2020 Global Restructure Program”). The Q2 2020 Global Restructure Program, consisting of voluntary and involuntary reductions-in-force and certain site closures, was commenced in order to align our cost structure to the demand levels that we anticipate over the coming quarters. The majority of the actions under the Q2 2020 Global Restructure Program are expected to be completed on or before June 30, 2021.
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The reductions-in-force, which are subject to the laws and regulations of the countries in which the actions are planned, are expected to impact approximately 980 positions. Over the life of the Q2 2020 Global Restructure Program, we expect to incur restructuring charges of between $35.0 million and $38.0 million related to reductions-in-force and between $8.0 million and $10.0 million related to site closures. We expect to settle these charges with cash on hand.
We expect these restructuring charges to impact our business segments and corporate functions as follows:
Reductions-in-ForceSite Closures
(Dollars in millions)PositionsMinimumMaximumMinimumMaximum
Performance Sensing214 $12.6 $13.7 $3.0 $4.0 
Sensing Solutions335 10.2 10.9 5.0 6.0 
Corporate and other431 12.2 13.4 0 0 
Total980 $35.0 $38.0 $8.0 $10.0 
Charges recognized in the nine months ended September 30, 2020 related to the Q2 2020 Global Restructure Program are presented by segment below. All charges related to severance costs and were recorded in restructuring and other charges, net.
For the nine months ended September 30, 2020
Performance Sensing$7,609 
Sensing Solutions7,181 
Corporate and other9,330 
Restructuring and other charges, net$24,120 
The following table presents the components of restructuring and other charges, net for the three and nine months ended March 31,September 30, 2020 and 2019:
For the three months endedFor the nine months ended
September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Q2 2020 Global Restructure Program charges$0 $0 $24,120 $0 
Other restructuring charges
Severance costs, net (1)
206 5,549 4,103 23,035 
Facility and other exit costs423 208 423 245 
Other (2)
(11,148)664 3,551 4,760 
Restructuring and other charges, net$(10,519)$6,421 $32,197 $28,040 

  For the three months ended
  March 31, 2020 March 31, 2019
Severance costs, net (1)
 $3,897
 $2,855
Other (2)
 601
 2,454
Restructuring and other charges, net $4,498
 $5,309
(1)    Severance costs, net (excluding those related to the Q2 2020 Global Restructure Program) for the nine months ended September 30, 2020 were related to termination benefits arising from the shutdown and relocation of an operating site in Northern Ireland. Severance costs, net for the three and nine months ended September 30, 2019 included termination benefits provided in connection with workforce reductions of manufacturing, engineering, and administrative positions including the elimination of certain positions related to site consolidations. Severance costs, net for the three months ended September 30, 2019 also included $6.5 million of termination benefits provided under a one-time benefit arrangement related to the shutdown and relocation of an operating site in Germany. Severance costs, net for the nine months ended September 30, 2019 also included approximately $12.7 million of benefits provided under a voluntary retirement incentive program offered to a limited number of eligible employees in the U.S.
(2)    In the three months ended September 30, 2020, we settled a patent infringement case brought by Wasica Finance GmbH ("Wasica") against Schrader, and released $11.7 million of the related liability, which is presented in restructuring and other charges, net. Refer to Note 12, "Commitments and Contingencies," for additional information related to this matter. For the nine months ended September 30, 2020, this release largely offset a charge of $12.1 million resulting from a prejudgment interest-related award granted by the court on behalf of Wasica in the three months ended June 30, 2020. Other charges in the three and nine months ended September 30, 2020 and 2019 primarily related to deferred compensation incurred in connection with the acquisition of GIGAVAC, LLC.
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(1)
Severance costs, net for the three months ended March 31, 2020 were primarily related to termination benefits arising from the shutdown and relocation of an operating site in Northern Ireland. Severance costs for the three months ended March 31, 2019 were primarily related to limited workforce reductions of manufacturing, engineering, and administrative positions.
(2)
Other charges in the three months ended March 31, 2020 and 2019 were primarily related to deferred compensation incurred in connection with the acquisition of GIGAVAC, LLC.
The following table presents changes toa rollforward of the severance portion of our restructuring liability duringobligations for the threenine months ended March 31, 2020:September 30, 2020. All balances at September 30, 2020 are presented in accrued expenses and other current liabilities on our condensed consolidated balance sheets.
  Severance
Balance at December 31, 2019 $14,779
Charges, net of reversals 3,897
Payments (5,356)
Foreign currency remeasurement (500)
Balance at March 31, 2020 $12,820

Q2 2020 Global Restructure ProgramOtherTotal
Balance at December 31, 2019$0 $14,779 $14,779 
Charges, net of reversals24,120 4,103 28,223 
Payments(11,601)(12,972)(24,573)
Foreign currency remeasurement333 (224)109 
Balance at September 30, 2020$12,852 $5,686 $18,538 
6. Other, Net
The following table presents the components of other, net for the three and nine months ended March 31,September 30, 2020 and 2019:
  For the three months ended
  March 31, 2020 March 31, 2019
Currency remeasurement gain on net monetary assets $1,553
 $1,865
(Loss)/gain on foreign currency forward contracts (3,781) 478
(Loss)/gain on commodity forward contracts (5,575) 1,123
Net periodic benefit cost, excluding service cost (4,381) (287)
Other (97) 10
Other, net $(12,281) $3,189

 For the three months endedFor the nine months ended
 September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Currency remeasurement gain/(loss) on net monetary assets$5,422 $(6,031)$5,878 $(8,492)
(Loss)/gain on foreign currency forward contracts(1,060)1,289 (4,424)2,806 
Gain on commodity forward contracts6,138 1,786 5,990 2,807 
Loss on debt refinancing0 (4,364)0 (4,364)
Net periodic benefit cost, excluding service cost(1,506)(272)(8,403)(846)
Other200 32 (552)164 
Other, net$9,194 $(7,560)$(1,511)$(7,925)
7. Income Taxes
The following table presents the (benefit from)/provision for income taxes for the three and nine months ended March 31,September 30, 2020 and 2019:
 For the three months ended
 March 31, 2020 March 31, 2019
(Benefit from)/provision for income taxes$(1,516) $21,467

 For the three months endedFor the nine months ended
 September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Provision for income taxes$15,181 $28,341 $15,106 $80,649 
The decrease in total tax from the prior periodperiods was predominantly related to the overall decrease in income before taxtaxes as impacted by the mix of profits in the various jurisdictions in which we operate.
In response to the global financial and health crisis caused by the coronavirus pandemic ("COVID-19"),COVID-19, the U.S. federal government enacted the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") on March 27, 2020. Federal limitations on interest deductions were reduced in connection with this legislation, and we recorded a deferred tax benefit of


$7.5 $7.5 million in the three months ended March 31, 2020, as we were able to utilize additional interest expense that was previously subject to a valuation allowance.
The (benefit from)/provision for income taxes consists of:
•current tax expense, which relates primarily to our profitable operations in non-U.S. tax jurisdictions and withholding taxes related to management fees, royalties, and the repatriation of foreign earnings; and
•deferred tax expense (or benefit), which represents adjustments in book-to-tax basis differences primarily related to (1) the step-up in fair value of fixed and intangible assets acquired in connection with business combination transactions, (2) changes in net operating loss carryforwards, (3) changes in tax rates, and (4) changes in our assessment of the realizability of our deferred tax assets.
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8. Net Income per Share
Basic and diluted net income per share are calculated by dividing net income by the number of basic and diluted weighted-average ordinary shares outstanding during the period. For the three and nine months ended March 31,September 30, 2020 and 2019 the weighted-average ordinary shares outstanding used to calculate basic and diluted net income per share were as follows:
 For the three months ended
 March 31, 2020 March 31, 2019
Basic weighted-average ordinary shares outstanding157,599
 163,247
Dilutive effect of stock options334
 635
Dilutive effect of unvested restricted securities452
 639
Diluted weighted-average ordinary shares outstanding158,385
 164,521

 For the three months endedFor the nine months ended
September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Basic weighted-average ordinary shares outstanding157,220 160,458 157,335 161,774 
Dilutive effect of stock options233 530 211 578 
Dilutive effect of unvested restricted securities526 320 444 417 
Diluted weighted-average ordinary shares outstanding157,979 161,308 157,990 162,769 
Net income and net income per share are presented in the condensed consolidated statements of operations.
Certain potential ordinary shares were excluded from our calculation of diluted weighted-average ordinary shares outstanding because either they would have had an anti–dilutive effect on net income per share or they related to equity awards that were contingently issuable for which the contingency had not been satisfied. These potential ordinary shares were as follows:
 For the three months ended
 March 31, 2020 March 31, 2019
Anti-dilutive shares excluded1,385
 1,013
Contingently issuable shares excluded596
 477

For the three months endedFor the nine months ended
September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Anti-dilutive shares excluded1,680 1,381 1,868 1,251 
Contingently issuable shares excluded1,183 767 1,010 679 
9. Inventories
The following table presents the components of inventories as of March 31,September 30, 2020 and December 31, 2019:
 March 31, 2020 December 31, 2019
Finished goods$205,819
 $197,531
Work-in-process100,057
 104,007
Raw materials208,398
 205,140
Inventories$514,274
 $506,678
September 30, 2020December 31, 2019
Finished goods$162,186 $197,531 
Work-in-process90,117 104,007 
Raw materials185,885 205,140 
Inventories$438,188 $506,678 


10. Pension and Other Post-Retirement Benefits
The components of net periodic benefit cost/(credit) associated with our defined benefit and retiree healthcare plans for the three months ended March 31,September 30, 2020 and 2019 were as follows:
 U.S. PlansNon-U.S. Plans 
 Defined BenefitRetiree HealthcareDefined BenefitTotal
 20202019202020192020201920202019
Service cost$0 $0 $2 $2 $777 $715 $779 $717 
Interest cost206 394 37 48 294 332 537 774 
Expected return on plan assets(292)(442)0 0 (177)(175)(469)(617)
Amortization of net loss311 242 (1)7 257 191 567 440 
Amortization of prior service (credit)/cost0 0 (196)(327)2 2 (194)(325)
Loss on settlement31 0 0 0 785 0 816 0 
Loss on curtailment0 0 249 0 0 0 249 0 
Net periodic benefit cost/(credit)$256 $194 $91 $(270)$1,938 $1,065 $2,285 $989 
 U.S. Plans Non-U.S. Plans  
 Defined Benefit Retiree Healthcare Defined Benefit Total
 2020 2019 2020 2019 2020 2019 2020 2019
Service cost$—
 $—
 $2
 $2
 $769
 $731
 $771
 $733
Interest cost267
 399
 37
 53
 315
 338
 619
 790
Expected return on plan assets(433) (451) —
 —
 (174) (175) (607) (626)
Amortization of net loss295
 245
 10
 11
 236
 191
 541
 447
Amortization of prior service (credit)/cost—
 —
 (196) (327) 2
 3
 (194) (324)
Loss on settlement4,022
 —
 —
 —
 —
 —
 4,022
 —
Net periodic benefit cost/(credit)$4,151
 $193
 $(147) $(261) $1,148
 $1,088
 $5,152
 $1,020
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The components of net periodic benefit cost/(credit) associated with our defined benefit and retiree healthcare plans for the nine months ended September 30, 2020 and 2019 were as follows:
 U.S. PlansNon-U.S. Plans 
 Defined BenefitRetiree HealthcareDefined BenefitTotal
 20202019202020192020201920202019
Service cost$0 $0 $7 $6 $2,485 $2,078 $2,492 $2,084 
Interest cost679 1,192 110 154 1,005 1,008 1,794 2,354 
Expected return on plan assets(1,018)(1,344)0 0 (523)(526)(1,541)(1,870)
Amortization of net loss906 732 18 29 852 574 1,776 1,335 
Amortization of prior service (credit)/cost0 0 (589)(981)7 8 (582)(973)
Loss on settlement4,363 0 0 0 2,344 0 6,707 0 
Loss on curtailment0 0 249 0 0 0 249 0 
Net periodic benefit cost/(credit)$4,930 $580 $(205)$(792)$6,170 $3,142 $10,895 $2,930 
Components of net periodic benefit cost/(credit) other than service cost are presented in other, net.net in the condensed consolidated statements of operations. Refer to Note 6, "Other, Net."
11. Debt
Our long-term debt, and finance lease, and other financing obligations as of March 31,September 30, 2020 and December 31, 2019 consisted of the following:
  Maturity Date March 31, 2020 December 31, 2019
Term Loan September 20, 2026 $459,568
 $460,725
4.875% Senior Notes October 15, 2023 500,000
 500,000
5.625% Senior Notes November 1, 2024 400,000
 400,000
5.0% Senior Notes October 1, 2025 700,000
 700,000
6.25% Senior Notes February 15, 2026 750,000
 750,000
4.375% Senior Notes February 15, 2030 450,000
 450,000
Less: discount   (11,220) (11,758)
Less: deferred financing costs   (23,359) (24,452)
Less: current portion   (4,630) (4,630)
Long-term debt, net   $3,220,359
 $3,219,885
       
       
Finance lease and other financing obligations   $30,745
 $31,098
Less: current portion   (2,465) (2,288)
Finance lease and other financing obligations, less current portion   $28,280
 $28,810

Maturity DateSeptember 30, 2020December 31, 2019
Term LoanSeptember 20, 2026$457,254 $460,725 
4.875% Senior NotesOctober 15, 2023500,000 500,000 
5.625% Senior NotesNovember 1, 2024400,000 400,000 
5.0% Senior NotesOctober 1, 2025700,000 700,000 
6.25% Senior NotesFebruary 15, 2026750,000 750,000 
4.375% Senior NotesFebruary 15, 2030450,000 450,000 
3.75% Senior NotesFebruary 15, 2031750,000 0 
Less: discount(10,143)(11,758)
Less: deferred financing costs(29,404)(24,452)
Less: current portion(4,631)(4,630)
Long-term debt, net$3,963,076 $3,219,885 
Finance lease and other financing obligations$30,778 $31,098 
Less: current portion(2,418)(2,288)
Finance lease and other financing obligations, less current portion$28,360 $28,810 
As of March 31,Revolving Credit Facility
On April 1, 2020, there was $416.1in order to enhance our financial flexibility given the general uncertainty associated with COVID-19, we withdrew $400.0 million available underfrom our $420.0 million revolving credit facility (the "Revolving Credit Facility"),. On August 17, 2020, we repaid these borrowings using a portion of the proceeds from issuance of the 3.75% Senior Notes, as detailed below.
As of September 30, 2020, we had $416.1 million available under the Revolving Credit Facility, net of $3.9 million of obligations related to outstanding letters of credit issued thereunder. Outstanding letters of credit are issued primarily for the benefit of certain operating activities. As of March 31,September 30, 2020, 0 amounts had been drawn against these outstanding letters of credit.
In order
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3.75% Senior Notes
On August 17, 2020, our indirect, wholly-owned subsidiary, Sensata Technologies, Inc. ("STI"), completed the issuance and sale of $750.0 million aggregate principal amount of 3.75% senior notes due 2031 (the "3.75% Senior Notes"). A portion of the proceeds of the issuance of the 3.75% Senior Notes was used to enhance our financial flexibility in light of COVID-19, we executed arepay approximately $400.0 million drawdown onof outstanding borrowings under the Revolving Credit Facility as well as to pay fees and expenses in connection with the offering of the 3.75% Senior Notes and related transactions. The 3.75% Senior Notes were issued under an indenture dated as of August 17, 2020 among STI, as issuer, The Bank of New York Mellon, as trustee, and our guarantor subsidiaries named therein (the "3.75% Senior Notes Indenture").
The 3.75% Senior Notes Indenture contains covenants that limit the ability of our indirect, wholly-owned subsidiary, Sensata Technologies B.V. ("STBV") and its subsidiaries (including STI) to, among other things: incur liens; engage in sale and leaseback transactions; with respect to any subsidiary of STBV (other than STI), incur indebtedness without such subsidiary’s guaranteeing the 3.75% Senior Notes; or consolidate, merge with, or sell, assign, convey, transfer, lease, or otherwise dispose of all or substantially all of their properties or assets to, another person. These covenants are subject to important exceptions and qualifications set forth in the 3.75% Senior Notes Indenture.
The 3.75% Senior Notes bear interest at 3.75% per year and mature on April 1, 2020.February 15, 2031. Interest is payable semi-annually on February 15 and August 15 of each year, commencing on February 15, 2021. The 3.75% Senior Notes are guaranteed by STBV and all of the subsidiaries of STBV (other than STI) that guarantee the obligations of (1) STI under its senior secured credit facilities and 4.375% Senior Notes due 2030, (2) STBV under the 4.875% Senior Notes due 2023, 5.625% Senior Notes due 2024, and 5.0% Senior Notes due 2025, and (3) Sensata Technologies UK Financing Co. plc under the 6.25% Senior Notes due 2026.
At any time, and from time to time, prior to February 15, 2026, STI may redeem the 3.75% Senior Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the 3.75% Senior Notes being redeemed, plus a “make whole” premium, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. At any time on or after February 15, 2026, STI may redeem the 3.75% Senior Notes, in whole or in part, at the following prices (expressed as a percentage of principal amount), plus accrued and unpaid interest, if any, up to but excluding the redemption date.
Period beginning February 15,Price
2026101.875 %
2027100.938 %
2028 and thereafter100.000 %
In addition, at any time prior to August 15, 2023, STI may redeem up to 40% of the principal amount of the outstanding 3.75% Senior Notes (including additional 3.75% Senior Notes, if any) with the net cash proceeds of certain equity offerings at a redemption price (expressed as a percentage of principal amount) of 103.75%, plus accrued and unpaid interest, if any, up to but excluding the redemption date, provided that at least 60% of the aggregate principal amount of the 3.75% Senior Notes (including additional 3.75% Senior Notes, if any) remains outstanding immediately after each such redemption.
Upon the occurrence of certain changes in control, each holder of the 3.75% Senior Notes will have the right to require STI to repurchase the 3.75% Senior Notes at 101% of their principal amount plus accrued and unpaid interest, if any, up to but excluding the date of repurchase.
Upon changes in certain tax laws or treaties, or any change in the official application, administration, or interpretation thereof, STI may, at its option, redeem the 3.75% Senior Notes, in whole but not in part, at a redemption price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, up to but excluding the redemption date, and all Additional Amounts (as defined in the 3.75% Senior Notes Indenture), if any, then due and which will become due on the date of redemption.
Accounting for Debt Financing Transactions
We account for our debt financing transactions as disclosed in Note 2, "Significant Accounting Policies" of the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019.
In connection with of the issuance of the 3.75% Senior Notes, we recognized $8.4 million of deferred financing costs, which are presented as a reduction of long-term debt on our condensed consolidated balance sheets.
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Accrued Interest
Accrued interest associated with our outstanding debt is included as a component of accrued expenses and other current liabilities in the condensed consolidated balance sheets. As of March 31,September 30, 2020 and December 31, 2019, accrued interest totaled $47.1$50.4 million and $42.8 million, respectively.


12. Commitments and Contingencies
We arewere a defendant in a lawsuit, Wasica Finance Gmbh et al v. Schrader International Inc. et al, Case No. 13-1353-CPS, U.S.D.C., Delaware, in which the claimant allegesalleged infringement of their patent (US 5,602,524) in connection with certain of our tire pressure monitoring system products. The patent in question has expired, and as a result, the claimant seekssought damages for past alleged infringement with interest and costs. The asserted patent iswas the U.S. counterpart of a German patent that had been previously asserted against Schrader. Schrader succeeded in proving that German patent to be invalid. On February 14, 2020, the federal jury trial related to this lawsuit concluded, and thea jury found Schrader International Inc.us liable for damages in the amount of $31.2 million. As a result, we recorded a loss of $29.2 million in the three months ended March 31, 2020 through cost of revenue. We continue to deny any wrongdoing, have filed post-trial motions,On July 6, 2020, the court awarded an additional $12.1 million for plaintiffs and intend to appealagainst us for prejudgment interest-related damages, and as a result, in the jury's decision, including any final circuit court order against us. As of March 31,three months ended June 30, 2020, we have recorded an accruala loss of $31.2$12.1 million relatedthrough restructuring and other charges, net, to reflect the court's order. The parties executed and closed a Litigation Settlement & License Agreement on September 18, 2020 to settle the matter for $31.6 million. As a result of this mattersettlement, in the three months ended September 30, 2020, we recognized a gain of $11.7 million, presented in restructuring and other long-term liabilities, basedcharges, net. The lawsuit was formally dismissed by the District Court (D. Del) on timingSeptember 22, 2020, and the U.S. Court of expected payment if our appeal is unsuccessful.Appeals for the Federal Circuit on September 24, 2020.
13. Shareholders' Equity
Treasury Shares
From time to time, our Board of Directors has authorized various share repurchase programs. The authorized amount of our various share repurchase programs, which may be modified or terminated by our Board of Directors at any time. We currently have an authorized $500.0 million share repurchase program under which approximately $302.3 million remained available as of March 31,September 30, 2020. On April 2, 2020, we announced a temporary suspension of this share repurchase program, which will continue to enhance our financial flexibility in light of the uncertainties surrounding COVID-19.remain on hold until market conditions show greater improvement and stability.
Accumulated Other Comprehensive Loss
The components of accumulated other comprehensive loss for the threenine months ended March 31,September 30, 2020 were as follows:
Cash Flow HedgesDefined Benefit and Retiree Healthcare PlansAccumulated Other Comprehensive Loss
Balance at December 31, 2019$16,546 $(37,030)$(20,484)
Other comprehensive loss before reclassifications, net of tax(17,815)0 (17,815)
Reclassifications from accumulated other comprehensive loss, net of tax(8,883)6,029 (2,854)
Other comprehensive (loss)/income(26,698)6,029 (20,669)
Balance at September 30, 2020$(10,152)$(31,001)$(41,153)
  Cash Flow Hedges Defined Benefit and Retiree Healthcare Plans Accumulated Other Comprehensive Loss
Balance at December 31, 2019 $16,546
 $(37,030) $(20,484)
Other comprehensive loss before reclassifications, net of tax (13,041) —
 (13,041)
Reclassifications from accumulated other comprehensive loss, net of tax (6,293) 3,342
 (2,951)
Other comprehensive (loss)/income (19,334) 3,342
 (15,992)
Balance at March 31, 2020 $(2,788) $(33,688) $(36,476)
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The details of the amounts reclassified from accumulated other comprehensive loss for the three and nine months ended March 31,September 30, 2020 and 2019 arewere as follows:
 For the three months ended March 31,  For the three months ended September 30,For the nine months ended September 30,Affected Line in Condensed Consolidated Statements of Operations
Component 2020 2019 Component2020201920202019Affected Line in Condensed Consolidated Statements of Operations
Derivative instruments designated and qualifying as cash flow hedges:     Derivative instruments designated and qualifying as cash flow hedges:
Foreign currency forward contracts $(6,623) $(3,219) 
Net revenue (1)
Foreign currency forward contracts$(625)$(7,615)$(13,640)$(17,327)
Net revenue (1)
Foreign currency forward contracts (1,768) (128) 
Cost of revenue (1)
Foreign currency forward contracts3,371 (968)1,796 (2,037)
Cost of revenue (1)
Total, before taxes (8,391) (3,347) Income before taxesTotal, before taxes2,746 (8,583)(11,844)(19,364)Income before taxes
Income tax effect 2,098
 686
 (Benefit from)/provision for income taxesIncome tax effect(687)1,760 2,961 3,970 Provision for income taxes
Total, net of taxes $(6,293) $(2,661) Net incomeTotal, net of taxes$2,059 $(6,823)$(8,883)$(15,394)Net income
     
Defined benefit and retiree healthcare plans $4,369
 $123
 
Other, net (2)
Defined benefit and retiree healthcare plans$1,438 $115 $8,150 $362 
Other, net (2)
Income tax effect (1,027) (40) (Benefit from)/provision for income taxesIncome tax effect(423)(32)(2,121)(113)Provision for income taxes
Total, net of taxes $3,342
 $83
 Net incomeTotal, net of taxes$1,015 $83 $6,029 $249 Net income
__________________________
(1)
(1)    Refer to Note 15, "Derivative Instruments and Hedging Activities," for additional information on amounts to be reclassified from accumulated other comprehensive loss in future periods.
Refer to Note 15, "Derivative Instruments and Hedging Activities" for additional information on amounts to be reclassified from accumulated other comprehensive loss in future periods.
(2)
Refer to Note 10, "Pension and Other Post-Retirement Benefits" for additional information on net periodic benefit cost/(credit).


(2)    Refer to Note 10, "Pension and Other Post-Retirement Benefits," for additional information on net periodic benefit cost/(credit).
14. Fair Value Measures
Measured on a Recurring Basis
The fair values of our assets and liabilities measured at fair value on a recurring basis as of March 31,September 30, 2020 and December 31, 2019 are shown in the below table. All fair value measures presented are categorized in Level 2 of the fair value hierarchy.
 September 30, 2020December 31, 2019
Assets
Foreign currency forward contracts$5,601 $23,561 
Commodity forward contracts7,266 3,623 
Total$12,867 $27,184 
Liabilities
Foreign currency forward contracts$16,919 $1,959 
Commodity forward contracts870 462 
Total$17,789 $2,421 
 March 31, 2020 December 31, 2019
Assets   
Foreign currency forward contracts$20,095
 $23,561
Commodity forward contracts2,079
 3,623
Total$22,174
 $27,184
    
Liabilities   
Foreign currency forward contracts$24,052
 $1,959
Commodity forward contracts4,993
 462
Total$29,045
 $2,421

Refer to Note 15, "Derivative Instruments and Hedging Activities," for additional information related to our forward contracts.
Measured on a Nonrecurring Basis
We evaluated our goodwill and other indefinite-lived intangible assets for impairment as of October 1, 2019 and determined that they were not impaired. As of March 31, 2020, we haveWe assessed the current and expected market impact of COVID-19, including the resulting impact on our forecasts, as of June 30, 2020, and have determined that our intangible assets (including goodwill) were not impaired asimpaired. During the three months September 30, 2020, no events or changes in circumstances occurred that would have triggered the need for an additional impairment review of March 31, 2020.these assets.
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Financial Instruments Not Recorded at Fair Value
The following table presents the carrying values and fair values of financial instruments not recorded at fair value in the condensed consolidated balance sheets as of March 31,September 30, 2020 and December 31, 2019. All fair value measures presented are categorized in Level 2 of the fair value hierarchy.
March 31, 2020 December 31, 2019 September 30, 2020December 31, 2019
Carrying Value (1)
 Fair Value 
Carrying Value (1)
 Fair Value
Carrying Value (1)
Fair Value
Carrying Value (1)
Fair Value
Liabilities       Liabilities
Term Loan$459,568
 $436,590
 $460,725
 $464,181
Term Loan$457,254 $452,681 $460,725 $464,181 
4.875% Senior Notes$500,000
 $480,000
 $500,000
 $532,500
4.875% Senior Notes$500,000 $525,000 $500,000 $532,500 
5.625% Senior Notes$400,000
 $384,000
 $400,000
 $444,000
5.625% Senior Notes$400,000 $429,000 $400,000 $444,000 
5.0% Senior Notes$700,000
 $665,000
 $700,000
 $759,500
5.0% Senior Notes$700,000 $749,000 $700,000 $759,500 
6.25% Senior Notes$750,000
 $727,500
 $750,000
 $808,125
6.25% Senior Notes$750,000 $776,250 $750,000 $808,125 
4.375% Senior Notes$450,000
 $396,000
 $450,000
 $457,875
4.375% Senior Notes$450,000 $469,125 $450,000 $457,875 
3.75% Senior Notes3.75% Senior Notes$750,000 $744,375 $0 $0 

(1)    Excluding any related debt discounts and deferred financing costs.
Cash and cash equivalents are carried at cost, which approximates fair value because of their short-term nature.
In addition to the above, we hold certain equity investments that do not have readily determinable fair values for which we use the measurement alternative prescribed in FASB ASC Topic 321, Investments - Equity Securities. Securities. Such investments are measured at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investmentinvestments of the same issuer. There were no impairments or changes resulting from observable transactions for any of these investments and no adjustments have beenwere made to their carrying values.
Refer to the table below for a detail of the carrying values of theseequity investments each ofusing the measurement alternative, which are presented as a component of other assets in other assets.the condensed consolidated balance sheets.
 March 31, 2020 December 31, 2019
Quanergy Systems, Inc$50,000
 $50,000
Lithium Balance—
 3,700
Total$50,000
 $53,700

September 30, 2020December 31, 2019
Quanergy Systems, Inc.$50,000 $50,000 
Other15,000 3,700 
Total$65,000 $53,700 


15. Derivative Instruments and Hedging Activities
Hedges of Foreign Currency Risk
For the three and nine months ended March 31,September 30, 2020 and 2019, amounts excluded from the assessment of effectiveness of our foreign currency forward contracts that are designated as cash flow hedges were not material. As of March 31,September 30, 2020, we estimateestimated that $3.5$10.5 million of net gainslosses will be reclassified from accumulated other comprehensive loss to earnings during the twelve-month period ending March 31,September 30, 2021.
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As of March 31,September 30, 2020, we had the following outstanding foreign currency forward contracts:
Notional
(in millions)		Effective Date(s)Maturity Date(s)Index (Exchange Rates)Weighted-Average Strike Rate
Hedge
Designation (1)
Notional
(in millions)
305.8 EUR		Effective Date(s)Various from November 2018 to September 2020Maturity Date(s)Various from October 2020 to September 2022Index (Exchange Rates)Weighted-Average Strike Rate
Hedge
Designation (1)
30.0 EURMarch 27, 2020April 30, 2020Euro ("EUR") to USD1.10 USDNot designated
325.7 EURVarious from May 2018 to March 2020Various from April 2020 to February 2022EUR to USD1.16 USDCash flow hedge
437.0509.0 CNYMarch 26,September 25, 2020AprilOctober 30, 2020USD to Chinese Renminbi ("CNY")7.126.87 CNYNot designated
804.6330.6 CNYVarious from December 2019 to January 2020Various from AprilOctober to December 2020USD to CNY6.997.01 CNYCash flow hedge
498.0700.0 JPYMarch 27,September 28, 2020AprilOctober 30, 2020USD to Japanese Yen ("JPY")107.94105.43 JPYNot designated
22,742.4
18,310.5 KRWVarious from MayNovember 2018 to MarchSeptember 2020Various from AprilOctober 2020 to FebruarySeptember 2022USD to Korean Won ("KRW")1,151.921,172.15 KRWCash flow hedge
16.0
10.0 MYRMarch 26,September 25, 2020AprilOctober 30, 2020USD to Malaysian Ringgit ("MYR")4.314.16 MYRNot designated
202.0
193.0 MXNMarch 27,September 28, 2020AprilOctober 30, 2020USD to Mexican Peso ("MXN")23.5322.34 MXNNot designated
2,961.02,991.8 MXNVarious from MayNovember 2018 to MarchSeptember 2020Various from AprilOctober 2020 to FebruarySeptember 2022USD to MXN21.3622.38 MXNCash flow hedge
2.07.0 GBPMarch 27,September 28, 2020AprilOctober 30, 2020British Pound Sterling ("GBP") to USD1.231.29 USDNot Designated
53.747.8 GBPVarious from MayNovember 2018 to MarchSeptember 2020Various from AprilOctober 2020 to FebruarySeptember 2022GBP to USD1.291.28 USDCash flow hedge

_________________________
(1)
(1)    Derivative financial instruments not designated as hedges are used to manage our exposure to currency exchange rate risk. They are intended to preserve economic value, and they are not used for trading or speculative purposes.
Derivative financial instruments not designated as hedges are used to manage our exposure to currency exchange rate risk. They are intended to preserve economic value, and they are not used for trading or speculative purposes.
Hedges of Commodity Risk
As of March 31,September 30, 2020, we had the following outstanding commodity forward contracts, none of which were designated for hedge accounting treatment in accordance with FASB ASC Topic 815, Derivatives and Hedging:
CommodityNotionalRemaining Contracted PeriodsWeighted-Average Strike Price Per Unit
Silver850,249672,759 troy oz.AprilOctober 2020 - FebruaryAugust 2022$16.6518.39
Gold7,7336,562 troy oz.AprilOctober 2020 - FebruaryAugust 2022$1,457.411,623.38
Nickel221,697157,338 poundsAprilOctober 2020 - FebruaryAugust 2022$6.166.26
Aluminum3,103,0952,027,231 poundsAprilOctober 2020 - FebruaryAugust 2022$0.870.85
Copper2,290,8671,666,157 poundsAprilOctober 2020 - FebruaryAugust 2022$2.692.66
Platinum7,8216,660 troy oz.AprilOctober 2020 - FebruaryAugust 2022$896.59893.48
Palladium942752 troy oz.AprilOctober 2020 - FebruaryAugust 2022$1,620.301,799.61
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Financial Instrument Presentation
The following table presents the fair values of our derivative financial instruments and their classification in the condensed consolidated balance sheets as of March 31,September 30, 2020 and December 31, 2019:
 Asset Derivatives Liability Derivatives
 Balance Sheet Location March 31, 2020 December 31, 2019 Balance Sheet Location March 31, 2020 December 31, 2019
Derivatives designated as hedging instruments      
Foreign currency forward contractsPrepaid expenses and other current assets $17,224
 $20,957
 Accrued expenses and other current liabilities $17,139
 $1,055
Foreign currency forward contractsOther assets 2,840
 2,530
 Other long-term liabilities 6,504
 428
Total  $20,064
 $23,487
   $23,643
 $1,483
            
Derivatives not designated as hedging instruments        
Commodity forward contractsPrepaid expenses and other current assets $1,635
 $3,069
 Accrued expenses and other current liabilities $3,603
 $394
Commodity forward contractsOther assets 444
 554
 Other long-term liabilities 1,390
 68
Foreign currency forward contractsPrepaid expenses and other current assets 31
 74
 Accrued expenses and other current liabilities 409
 476
Total  $2,110
 $3,697
   $5,402
 $938

 Asset DerivativesLiability Derivatives
 Balance Sheet LocationSeptember 30, 2020December 31, 2019Balance Sheet LocationSeptember 30, 2020December 31, 2019
Derivatives designated as hedging instruments
Foreign currency forward contractsPrepaid expenses and other current assets$3,420 $20,957 Accrued expenses and other current liabilities$13,309 $1,055 
Foreign currency forward contractsOther assets2,171 2,530 Other long-term liabilities3,567 428 
Total$5,591 $23,487 $16,876 $1,483 
Derivatives not designated as hedging instruments
Commodity forward contractsPrepaid expenses and other current assets$5,876 $3,069 Accrued expenses and other current liabilities$451 $394 
Commodity forward contractsOther assets1,390 554 Other long-term liabilities419 68 
Foreign currency forward contractsPrepaid expenses and other current assets10 74 Accrued expenses and other current liabilities43 476 
Total$7,276 $3,697 $913 $938 
These fair value measurements arewere all categorized within Level 2 of the fair value hierarchy.
The following tables present the effect of our derivative financial instruments on the condensed consolidated statements of operations and the condensed consolidated statements of comprehensive (loss)/income for the three months ended March 31,September 30, 2020 and 2019:
Derivatives designated as
hedging instruments		Amount of Deferred (Loss)/Gain Recognized in Other Comprehensive (Loss)/IncomeLocation of Net Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Net IncomeAmount of Net Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Net Income
2020201920202019
Foreign currency forward contracts$(12,666)$19,797 Net revenue$625 $7,615 
Foreign currency forward contracts$7,021 $(2,514)Cost of revenue$(3,371)$968 
Derivatives designated as
hedging instruments		 Amount of Deferred Gain/(Loss) Recognized in Other Comprehensive (Loss)/Income Location of Net Gain Reclassified from Accumulated Other Comprehensive Loss into Net Income Amount of Net Gain Reclassified from Accumulated Other Comprehensive Loss into Net Income
2020 2019 2020 2019
Derivatives not designated as
hedging instruments		Derivatives not designated as
hedging instruments		Amount of Gain/(Loss) Recognized in Net IncomeLocation of Gain/(Loss) Recognized in Net Income
20202019
Commodity forward contractsCommodity forward contracts$6,138 $1,786 Other, net
Foreign currency forward contracts $12,544
 $9,118
 Net revenue $6,623
 $3,219
Foreign currency forward contracts$(1,060)$1,289 Other, net
Foreign currency forward contracts $(29,630) $6,078
 Cost of revenue $1,768
 $128
The following tables present the effect of our derivative financial instruments on the condensed consolidated statements of operations and the condensed consolidated statements of comprehensive income for the nine months ended September 30, 2020 and 2019:
Derivatives designated as
hedging instruments		Amount of Deferred (Loss)/Gain Recognized in Other Comprehensive (Loss)/IncomeLocation of Net Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Net IncomeAmount of Net Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Net Income
2020201920202019
Foreign currency forward contracts$(6,076)$30,124 Net revenue$13,640 $17,327 
Foreign currency forward contracts$(17,342)$3,946 Cost of revenue$(1,796)$2,037 
Derivatives not designated as
hedging instruments		Amount of Gain/(Loss) Recognized in Net IncomeLocation of Gain/(Loss) Recognized in Net Income
20202019
Commodity forward contracts$5,990 $2,807 Other, net
Foreign currency forward contracts$(4,424)$2,806 Other, net
Derivatives not designated as
hedging instruments		 Amount of (Loss)/Gain Recognized in Net Income Location of (Loss)/Gain Recognized in Net Income
 2020 2019 
Commodity forward contracts $(5,575) $1,123
 Other, net
Foreign currency forward contracts $(3,781) $478
 Other, net
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Credit Risk Related Contingent Features
We have agreements with certain of our derivative counterparties that contain a provision whereby if we default on our indebtedness and repayment of the indebtedness has been accelerated by the lender, then we could also be declared in default on our derivative obligations.
As of March 31,September 30, 2020, the termination value of outstanding derivatives in a liability position, excluding any adjustment for non-performance risk, was $29.3$17.9 million. As of March 31,September 30, 2020, we had 0t posted any cash collateral related to these agreements. If we breach any of the default provisions on any of our indebtedness as described above, we could be required to settle our obligations under the derivative agreements at their termination values.
16. Acquisitions
On September 13, 2019, we completed 1 acquisition for approximately $30 million, net of cash acquired.


17. Segment Reporting
In the three months ended June 30, 2020, we altered the way we measure segment operating income in order to align with a change to the performance measures provided to and used by our chief operating decision maker for purposes of assessing performance and deciding how to allocate resources to each segment. Whereas research and development ("R&D") and selling, general and administrative ("SG&A") expenses related to our megatrend initiatives were historically allocated to our operating segments, beginning in the second quarter these amounts are presented within corporate and other. Prior period information has been recast to reflect this revised presentation.
We operate in, and report financial information for, the following 2 reportable segments, Performance Sensing and Sensing Solutions, each of which is also an operating segment. Our operating segments are businesses that we manage as components of an enterprise, for which separate financial information is evaluated regularly by our chief operating decision maker in deciding how to allocate resources and assess performance.
An operating segment’s performance is primarily evaluated based on segment operating income, which excludes amortization of intangible assets, restructuring and other charges, net, certain costs associated with our strategic megatrend initiatives, and certain corporate costs/costs or credits not associated with the operations of the segment, including share-based compensation expense and a portion of depreciation expense associated with assets recorded in connection with acquisitions. Corporate and other costs excluded from an operating segment’s performance are separately stated below and also include costs that are related to functional areas, such as finance, information technology, legal, and human resources. We believe that segment operating income, as defined above, is an appropriate measure for evaluating the operating performance of our segments. However, this measure should be considered in addition to, and not as a substitute for, or superior to, operating income or other measures of financial performance prepared in accordance with U.S. GAAP. The accounting policies of each of our reporting segments are materially consistent with those in the summary of significant accounting policies as described in Note 2, "Significant Accounting Policies" of the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019.
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The following table presents net revenue and segment operating income for the reported segments and other operating results not allocated to the reported segments for the three and nine months ended March 31,September 30, 2020 and 2019:2019 (recast to reflect realignment of performance measures as discussed above):
 For the three months endedFor the nine months ended
 September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Net revenue:
Performance Sensing$580,936 $628,593 $1,534,832 $1,913,137 
Sensing Solutions207,377 221,122 604,255 690,803 
Total net revenue$788,313 $849,715 $2,139,087 $2,603,940 
Segment operating income (as defined above):
Performance Sensing$151,626 $170,240 $347,428 $498,982 
Sensing Solutions58,229 71,570 170,545 224,826 
Total segment operating income209,855 241,810 517,973 723,808 
Corporate and other(60,967)(53,352)(203,803)(151,522)
Amortization of intangible assets(32,562)(35,905)(98,397)(108,079)
Restructuring and other charges, net10,519 (6,421)(32,197)(28,040)
Operating income126,845 146,132 183,576 436,167 
Interest expense, net(44,129)(39,556)(124,340)(118,417)
Other, net9,194 (7,560)(1,511)(7,925)
Income before taxes$91,910 $99,016 $57,725 $309,825 
 For the three months ended
 March 31, 2020 March 31, 2019
Net revenue:   
Performance Sensing$568,689
 $640,028
Sensing Solutions205,580
 230,471
Total net revenue$774,269
 $870,499
Segment operating income (as defined above):   
Performance Sensing$129,062
 $150,509
Sensing Solutions55,949
 74,969
Total segment operating income185,011
 225,478
Corporate and other(88,822) (41,430)
Amortization of intangible assets(33,092) (36,143)
Restructuring and other charges, net(4,498) (5,309)
Operating income58,599
 142,596
Interest expense, net(39,403) (39,253)
Other, net(12,281) 3,189
Income before taxes$6,915
 $106,532
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18. Subsequent Events
On April 2, 2020, we announced a series of actions taken in response to COVID-19. These actions are designed to protect the health and safety of our employees, enable us to continue to serve critical customer needs, and further enhance our financial flexibility. Actions taken to enhance our financial flexibility included a temporary suspension of our share repurchase program and a $400.0 million drawdown on the Revolving Credit Facility on April 1, 2020, leaving us with cash on hand of approximately $1.2 billion on that date.



Cautionary Statements Concerning Forward-Looking Statements
This Quarterly Report on Form 10-Q, including any documents incorporated by reference herein, includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to analyses and other information that are based on forecasts of future results and estimates of amounts not yet determinable. These forward-looking statements also relate to our future prospects, developments, and business strategies and may be identified by terminology such as "may," "will," "could," "should," "expect," "anticipate," "believe," "estimate," "predict," "project," "forecast," "continue," "intend," "plan," and similar terms or phrases, or the negative of such terminology, including references to assumptions. However, these terms are not the exclusive means of identifying such statements.
Forward-looking statements contained herein, or in other statements made by us, are made based on management’s expectations and beliefs concerning future events impacting us. These statements are subject to uncertainties and other important factors relating to our operations and business environment, all of which are difficult to predict, and many of which are beyond our control, that could cause our actual results to differ materially from those matters expressed or implied by forward-looking statements. Although we believe that our plans, intentions, and expectations reflected in, or suggested by, such forward-looking statements are reasonable, we can give no assurances that any of the events anticipated by these forward-looking statements will occur or, if any of them do, what impact they will have on our results of operations and financial condition.
We believe that the following important factors, among others (including those set forth here and described in Item 1A, "Risk Factors," in our Annual Report on Form 10-K for the year ended December 31, 2019), could affect our future performance and the liquidity and value of our securities and cause our actual results to differ materially from those expressed or implied by forward-looking statements made by us or on our behalf:
•Future risks and existing uncertainties associated with the COVID-19 pandemic, which continues to have a significant adverse impact on our business and operations including: (i) full or partial shutdowns of our facilities as mandated by government decrees, (ii) limited ability to adjust certain costs due to government actions, (iii) significant travel restrictions and “work-from-home” orders limiting the availability of our workforce, (iv) supplier constraints and supply-chain interruptions, (v) logistics challenges and limitations, (vi) reduced demand from certain customers, (vi) uncertainties associated with a protracted economic slowdown that could negatively affect the financial condition of our customers and suppliers, and (vii) uncertainties and volatility in the global capital markets;
•business disruptions due to natural disasters or other disasters outside our control, such as the global coronavirus (COVID-19)COVID-19 pandemic.
•instability and changes in the global markets, including regulatory, political, economic, governmental, and military matters, such as the recent exit of the United Kingdom (the "U.K.") from the European Union (the "EU");
•adverse conditions or competition in the industries upon which we are dependent, including the automotive industry;
•competitive pressure from customers that could require us to reduce prices or result in reduced demand;
•losses and costs as a result of intellectual property, product liability, warranty, and recall claims;
•market acceptance of new product introductions and product innovations;
•supplier interruption or non-performance, limiting our access to manufactured components or raw materials;
•risks related to the acquisition or disposition of businesses, or the restructuring of our business;
•labor disruptions or increased labor costs;
•inability to realize all of the revenue or achieve anticipated gross margins from products subject to existing purchase orders for which we are currently engaged in development;
•security breaches, cyber theft of our intellectual property, and other disruptions to our information technology infrastructure, or improper disclosure of confidential, personal, or proprietary data;
•foreign currency risks, changes in socio-economicsocioeconomic conditions, or changes to monetary and fiscal policies;
•our level of indebtedness, or our inability to meet debt service obligations or comply with the covenants contained in the credit agreement and senior notes indentures;
•changes to current policies, such as trade tariffs, by the U.S. government;
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•risks related to the potential for goodwill impairment;
•the impact of challenges by taxing authorities of our historical and future tax positions or our allocation of taxable income among our subsidiaries, unfavorable developments in taxation sentiments in countries where we do business, and challenges to the sovereign taxation regimes of EU member states by the European Commission and the Organization for Economic Co-operation and Development;
•changes to, or inability to comply with, various regulations, including tax laws, import/export regulations, anti-bribery laws, environmental, health, and safety laws, and other governmental regulations; and
•risks related to our domicile in the U.K.


In addition, the extent to which the COVID-19 pandemic will continue to impact our business and financial results going forward will be dependent on future developments, such as the length and severity of the crisis, the potential resurgence of the crisis, future government actions in response to the crisis and the overall impact of the COVID-19 pandemic on the global economy and capital markets, among many other factors, all of which remain highly uncertain and unpredictable.
All forward-looking statements attributable to us or persons acting on our behalf speak only as of the date of this Quarterly Report on Form 10-Q and are expressly qualified in their entirety by the cautionary statements contained in this Quarterly Report on Form 10-Q. We undertake no obligation to update or revise forward-looking statements that may be made to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. We urge readers to review carefully the risk factors described in our Annual Report on Form 10-K for the year ended December 31, 2019 and in the other documents that we file with the U.S. Securities and Exchange Commission. You can read these documents at www.sec.gov or on our website at www.sensata.com.

Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019, filed with the U.S. Securities and Exchange Commission on February 11, 2020, and the unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q.
Overview
The COVID-19 pandemic has caused widespread disruptions to our Company, employees, customers, suppliers, and communities. Duringcommunities since the first quarter these disruptions were primarily limitedof 2020. We recognized the global impact of COVID-19 early, and took a wide range of actions across our organization, designed to benefit the health and safety of employees, while also enabling us to respond to customer needs and enhance our financial flexibility during the pandemic. We are continuing to work with local, state, and federal governmental health agencies in many countries, implementing measures to help protect employees and minimize the spread of COVID-19 in our communities.
In the third quarter of 2020, the global economic rebound from government-instituted lockdowns and quarantines has been dramatic. We continue to deliver strong market "outgrowth," defined as the amount by which revenue performance of our business is favorable to the performance of the markets that the business serves. For the first nine months of 2020, we delivered 840 basis points of outgrowth in our HVOR business and 610 basis points of outgrowth in our automotive business. We continue to monitor all of our end markets and customers to ensure that our resources are balanced against forecasts and prioritized against critical growth opportunities.
During the third quarter of 2020, we closed over $95 million in new business wins, bringing the year-to-date total to $320 million, including $140 million in Electrification wins, ahead of the pace of new business wins in the prior year. We define new business wins as incremental revenue to our manufacturing operationscurrent base of business that is expected to be recognized on average in China, most of which were closed for approximately three weeks during the quarter due to government mandates. Asfifth year after entry into the virus spread toagreement, when the rest of the world in March, most ofprogram reaches its normal volume. We have demonstrated progress against our other operations outside of China also were impacted. As of March 31, 2020, we were still experiencing significant disruptions,megatrend initiatives, and at a minimum, we expect those disruptionsintend to continue throughoutthese efforts to expand our markets and provide strong growth and differentiation for the future. We continue to believe investments in these megatrends, including technology collaborations and partnerships with third parties to expand our technological capabilities, will further our end market diversification, increase our long-term growth rate and provide important competitive advantages as these trends transform our world. In addition, we believe that the overall market environment may provide meaningful opportunities to further strengthen our portfolio through strategically important, value-creating acquisitions.
We have taken multiple steps to enhance our financial flexibility. In the second quarter of 2020, we commenced the Q2 2020 Global Restructure Program. No additional charges related to this program were recognized in the third quarter of 2020.
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However, we continue to realize savings, primarily from actions related to the Q2 2020 Global Restructure Program, but also from ongoing cost reduction activities and spend controls. Such savings represented approximately $7 million in the third quarter of 2020. These disruptions include, depending onWe expect to realize at least that amount in the specific location, full or partial shutdownsfourth quarter. In the third quarter of 2020, we took advantage of historically low interest rates to raise $750.0 million through the issuance and sale of the 3.75% Senior Notes, extending the maturity of our facilities as mandated by government decrees, limited abilitydebt profile and lowering our cost of capital. Given improving market conditions and strengthening financial markets, we repaid approximately $400.0 million of outstanding borrowings under the Revolving Credit Facility that we had drawn in April.
Megatrends
Despite the impact of COVID-19, we continue to adjust certain costs dueinvest in our megatrend growth initiatives, seeing no evidence that customers are meaningfully slowing their investments in these areas. Our three initiatives of focus are (1) Smart & Connected, (2) Electric Vehicles and Smart Grid Electrification, and (3) Industrial Internet of Things (IIoT)/Digitization of Factories & Warehouses.
Smart & Connected
Our objective with the Smart & Connected initiative, which provides a large market opportunity across heavy vehicle management and medium and light vehicles, is to government actions, significant travel restrictionsbecome the leader in insight and “work-from-home” orders limitingprognostics to fleet operators and owners. In the availabilitythird quarter of 2020, we signed our first Smart & Connected commercial fleet management agreement with a leading North American fleet manager, under which we will install and operate our Smart & Connected suite of hardware and data services on a full subscription basis, beginning in the fourth quarter of 2020.
Electrification
Our objective with the Electric Vehicles and Smart Grid Electrification (Electrification) initiative, which provides a large market opportunity across high voltage components and advanced grid technologies, is to become the leading and foundational player in mission critical high voltage components and subsystems with high value solutions in advanced smart grid technologies. During the third quarter of 2020, we closed $32 million in Electrification new business wins; bringing the year-to-date total to $140 million, spanning across all geographies and many of the largest automotive original equipment manufacturers ("OEMs").
While the automotive space will be a large beneficiary of the Electrification megatrend, the effects will impact all of our workforce, supplier constraintsend markets, including heavy vehicles, charging infrastructure, and smart grid applications, in total representing an expected $6.5 billion addressable market for Sensata by 2030. We are expanding our capabilities here, including through third party collaboration, and expect continued material supply-chain interruptions, logistics challenges and limitations, and reduced demand from certain customers.expansion of Electrification within our industrial business.
The COVID-19 outbreak did have a negative impact on our first quarter 2020 results, and we expect it to have a negative impact on our second quarter 2020 results. The extentIndustrial Internet of Things
As part of the impact onbroader Smart & Connected megatrend, our second quarter 2020 resultsobjective in the Industrial Internet of Things (IIoT)/Digitization of Factories & Warehouses initiative is to become a leader in factory smart sensing and beyondedge intelligence with solutions in machine health and materials tracking. The digitization of factories and warehouses represent fast-growing opportunities that we believe will be dependent on future developments such as the lengthdrive new business wins and severity of the crisis, the potential resurgence of the crisis, future government actions in responsemarket outgrowth for our Industrial business unit. Bringing our sensing solutions to the crisisenhance material handling and the overall impact of the COVID-19 pandemic on the global economyelectrification charging infrastructure represent fast growing opportunities that we believe will drive industrial business content and capital markets, among many other factors, all of which remain highly uncertain and unpredictable.market outgrowth.
Given these uncertainties and negative impact of the COVID-19 pandemic, weFinancial Flexibility
We have taken multiple steps to manage and reduce operating costs and further enhance our financial flexibility,flexibility. In the second quarter, we implemented various cost reduction activities, including the Board’s formation of a Health & Economic Response Committee to oversee the impact of the COVID-19 pandemic. These steps also include the following actions to reduce compensation expensetemporary salary reductions and furloughs, resulting in savings in the second quarter 2020: (1)of approximately $21.8 million, including the impact of government subsidies. These salary reductions and furloughs did not continue in the third quarter. However, we have continued working to align our long-term operating costs with future expected demand levels, maintaining lower levels of discretionary spending and keeping production in certain facilities at a 50% reductionlevel necessary to the cash retainers paid to non-employee directors; (2) a reduction to the Chief Executive officer salary to $1.00; (3) a 25% reduction to the salaries of all senior leaders of the Company; and (4) temporary furloughs or equivalent cost saving methods for the remaining workforce. We also are taking steps to reduce capital and discretionary expenditures and to ramp down certain production facilitiesbe in line with end market demand. We expect these actions to generate approximately $15 million to $20 millionIn addition, we reduced our capital expenditures forecast for the year and are carefully managing our working capital. Also in cost savings during the second quarter, we commenced the Q2 2020 Global Restructure Program, discussed in more detail below.
We believe that we are in a strong financial position today, having generated $293.3 million of operating cash flow in the nine months ended September 30, 2020.
Further, Additionally, in the third quarter of 2020, we took advantage of historically low interest rates in issuing $750.0 million aggregate principal amount of 3.75% Senior Notes. Given improving market conditions and strengthening financial markets, we decided to provide maximum financial flexibility dueuse a portion of the proceeds to COVID-19, we drew downrepay approximately $400.0 million onof outstanding borrowings under the Revolving Credit FacilityFacility. In taking these actions, we extended the maturity of our debt profile and lowered our cost of capital.
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Q2 2020 Global Restructure Program
On June 30, 2020, in response to the potential long-term impact of COVID-19 on April 1,our business, we commenced the Q2 2020 resultingGlobal Restructure Program, which consists of actions such as voluntary and involuntary reductions-in-force and certain site closures in order to align our cost structure to the demand levels that we anticipate in the coming quarters. This program is expected to impact approximately 980 positions. The majority of the actions under the Q2 2020 Global Restructure Program are expected to be completed on or before June 30, 2021.
Over the life of the Q2 2020 Global Restructure Program, we expect to incur restructuring charges of between $35.0 million and $38.0 million related to reductions-in-force and between $8.0 million and $10.0 million related to site closures. We expect to settle these charges with cash on hand ashand.
In the nine months ended September 30, 2020, we accrued $24.1 million of severance charges related to this program (all in the second quarter). As of September 30, 2020, our severance liability related to the Q2 2020 Global Restructure Program was $12.9 million. Refer to Note 5, "Restructuring and Other Charges, Net," of our condensed consolidated financial statements, included elsewhere in this Quarterly Report on Form 10-Q, for additional information on this restructuring program.
We continue to realize savings in the third quarter related to the Q2 2020 Global Restructure Program, but also from ongoing cost reduction activities and spend controls. Such savings represented approximately $7 million in the third quarter of 2020. We expect to realize at least that dateamount in the fourth quarter. We expect that the actions taken in the Q2 2020 Global Restructure Program will result in annualized savings of personnel- and facilities-related costs of approximately $1.2 billion. In addition, effective April 1, 2020, we have temporarily suspended our share repurchase program.
Given the foregoing and unprecedented market uncertainty, the Company is currently unable to quantify the expected impact of the COVID-19 pandemic on its future operations, financial condition, liquidity and results of operations. The Company plans to continue taking actions to help mitigate, as best we can, the impact of the COVID-19 pandemic on the health and well-being of our employees, the communities in which we operate and our business partners, as well as the impact on our operations and business as a whole. However, there can be no assurance that the COVID-19 pandemic will not have a material adverse impact on our financial condition, liquidity, and results of operations.

$49 million by 2021.
Results of Operations
The table below presents our historical results of operations, in millions of dollars and as a percentage of net revenue, for the three and nine months ended March 31,September 30, 2020 compared to the three and nine months ended March 31,September 30, 2019. We have derived the results of operations from the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. Amounts and percentages in the table below have been calculated based on unrounded numbers. Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.
For the three months ended For the three months endedFor the nine months ended
March 31, 2020 March 31, 2019 September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Amount Margin* Amount Margin*AmountMargin*AmountMargin*AmountMargin*AmountMargin*
Net revenue:       Net revenue:
Performance Sensing$568.7
 73.4 % $640.0
 73.5 %Performance Sensing$580.9 73.7 %$628.6 74.0 %$1,534.8 71.8 %$1,913.1 73.5 %
Sensing Solutions205.6
 26.6
 230.5
 26.5
Sensing Solutions207.4 26.3 221.1 26.0 604.3 28.2 690.8 26.5 
Net revenue774.3
 100.0
 870.5
 100.0
Net revenue788.3 100.0 849.7 100.0 2,139.1 100.0 2,603.9 100.0 
Operating costs and expenses715.7
 92.4
 727.9
 83.6
Operating costs and expenses661.5 83.9 703.6 82.8 1,955.5 91.4 2,167.8 83.2 
Operating income58.6
 7.6
 142.6
 16.4
Operating income126.8 16.1 146.1 17.2 183.6 8.6 436.2 16.8 
Interest expense, net(39.4) (5.1) (39.3) (4.5)Interest expense, net(44.1)(5.6)(39.6)(4.7)(124.3)(5.8)(118.4)(4.5)
Other, net(12.3) (1.6) 3.2
 0.4
Other, net9.2 1.2 (7.6)(0.9)(1.5)(0.1)(7.9)(0.3)
Income before taxes6.9
 0.9
 106.5
 12.2
Income before taxes91.9 11.7 99.0 11.7 57.7 2.7 309.8 11.9 
(Benefit from)/provision for income taxes(1.5) (0.2) 21.5
 2.5
Provision for income taxesProvision for income taxes15.2 1.9 28.3 3.3 15.1 0.7 80.6 3.1 
Net income$8.4
 1.1 % $85.1
 9.8 %Net income$76.7 9.7 %$70.7 8.3 %$42.6 2.0 %$229.2 8.8 %
__________________________
*     Represents the amount presented divided by total net revenue.
Net Revenue - Overall
For the three and nine months ended September 30, 2020, net revenue declined compared to the prior year largely due to end-market contraction caused by COVID-19.
The following table presents a reconciliation of organic revenue decline, a non-GAAP financial measure, to reported net revenue decline, a financial measure determined in accordance with U.S. GAAP, for the three and nine months ended March 31,September 30, 2020 compared to the three and nine months ended March 31,September 30, 2019. Refer to the section entitled Non-GAAP Financial Measures below for further information on our use of organic revenue growth or decline.
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Three-Month DeclineThree months ended September 30, 2020Nine months ended September 30, 2020
Performance Sensing Sensing Solutions TotalPerformance SensingSensing SolutionsTotalPerformance SensingSensing SolutionsTotal
Reported net revenue decline(11.1)% (10.8)% (11.1)%Reported net revenue decline(7.6)%(6.2)%(7.2)%(19.8)%(12.5)%(17.9)%
Percent impact of:     Percent impact of:
Foreign currency remeasurement (1)
(0.7) (0.4) (0.7)
Foreign currency remeasurement (1)
0.3 %0.2 %0.3 %(0.5)%(0.3)%(0.5)%
Organic revenue decline(10.4)% (10.4)% (10.4)%Organic revenue decline(7.9)%(6.4)%(7.5)%(19.3)%(12.2)%(17.4)%
__________________________
(1)
Represents the percentage change in net revenue between the comparative periods attributed to differences in exchange rates used to remeasure foreign currency denominated revenue transactions into USD, which is the functional currency of the Company and each of its subsidiaries. The percentage amounts presented above related primarily to the USD to CNY and the EUR to USD exchange rates.
(1)    Represents the percentage change in net revenue between the comparative periods attributed to differences in exchange rates used to remeasure foreign currency denominated revenue transactions into USD, which is the functional currency of the Company and each of its subsidiaries. The percentage amounts presented above related primarily to the USD to CNY and the EUR to USD exchange rates.
Net Revenue - Performance Sensing
For the three months ended March 31,September 30, 2020, Performance Sensing net revenue declined 11.1%7.6%, or 10.4%7.9% on an organic basis, driven primarily by impacts from COVID-19. OEM customers ramped production within their facilities through the quarter in an effort to replace production lost during the prior quarter shut-downs. For the nine months ended September 30, 2020, Performance Sensing net revenue declined 19.8%, or 19.3% on an organic basis.
Automotive
For the three months ended September 30, 2020, automotive net revenue declined 11.0%7.6% compared to the prior year. Excluding growth of 0.3% attributed to foreign currency exchange rate differences between the two periods, automotive net revenue in the three months ended September 30, 2020 declined 7.9% on an organic basis. During the first half of the year we attributed a portion of automotive revenue growth to supply chain inventory building. During the third quarter, we saw global channel inventory at our customers contract. The combination of this inventory contraction along with lower end market production created a total market decline of 10.8% in the third quarter, representing outgrowth in our automotive business of 290 basis points. This outgrowth continues to be led by emissions, electrification, and safety-related launches.
For the nine months ended September 30, 2020, versusautomotive net revenue declined 20.5% compared to the corresponding prior-year period.prior year. Excluding a 0.6% decline of 0.5% attributed to foreign exchange rate differences between the two periods, automotive net revenue in the nine months ended September 30, 2020 declined 10.4%20.0% on an organic basis. basis, representing outgrowth of 610 basis points.
HVOR
For the three months ended September 30, 2020, HVOR net revenue declined 11.5%7.5% compared to the corresponding period in the three months ended March 31, 2020 versus the corresponding prior-year period.prior year. Excluding a 0.8% declinegrowth of 0.3% attributed to foreign exchange rate differences between the two periods, HVOR net revenue in the three months ended September 30, 2020 declined 10.7%7.8% on an organic basis.

While our automotive business experiencedbasis, representing outgrowth of 860 basis points compared to a 10.4% organic revenue decline, our end-market productionmarket that was down 19.5% in the first quarter of 2020 versus the corresponding prior-year period.  The difference between the performance of our automotive16.4%.
Our China on-road truck business and thatcontinued to post better than expected growth, as a result of the end-markets we serve is due primarily to two factors. First, we were able to alleviate the impact of end-market declines by delivering market outgrowth, driven by increased content in all regions, but particularly in China where we experienced strong content growth, following theongoing adoption of NS6 emissions regulations. Additionally,While our China business grew in the third quarter, we noted growthexperienced substantial declines in both Europe and the Americas, as the result of automotive OEMs, particularly in China, stocking inventory to ensure adequate supplyproduction levels in anticipationthese geographies declined year over year.
For the nine months ended September 30, 2020, HVOR net revenue declined 17.4% compared to the prior year. Excluding a decline of reopening plants and ramping up production. We expect automotive end-markets0.5% attributed to be worseforeign exchange rate differences between the two periods, HVOR net revenue in the second quarternine months ended September 30, 2020, declined 16.9% on an organic basis, representing outgrowth of 2020 as OEM plant shutdowns and production declines continue. Our primary independent third-party source for information on automotive production in future periods is predicting840 basis points compared to a 47% decline in automotive production for the second quarter of 2020 and a 22% decline in automotive production for the full year 2020.
While our HVOR business generated a 10.7% organic revenue decline, end-market productionmarket that was down 20.0% in the first quarter of 2020 versus the corresponding prior-year period.  The difference between the performance of our HVOR business and the performance of the end-markets it serves is the result of market outgrowth, due primarily to increased content.  Similar to our automotive business, a significant portion of this content came from China following the adoption of NS6 emissions regulations. We evaluate key economic indicators to gauge the health of our HVOR customers and the markets they serve, including freight load factors, truck inventory to sales ratios, building permits, industrial production, crop futures, and farm machinery. Based on some of these indicators, we expect HVOR end-markets to remain down throughout the second quarter of 2020.25.3%.
Net Revenue - Sensing Solutions
For the three months ended March 31,September 30, 2020, Sensing Solutions net revenue declined 10.8%decreased 6.2%, or 10.4%6.4% on an organic basis, primarily driven by the impacts of COVID-19. For the nine months ended September 30, 2020, Sensing Solutions net revenue decreased 12.5%, or 12.2% on an organic basis.
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Industrial and Other
For the three months ended September 30, 2020, industrial and other net revenue declined 12.8% in2.0% compared to the first quarterprior year. Excluding growth of 2020 versus the corresponding prior-year period.  Excluding a 0.5% decline0.2% attributed to foreign exchange rate differences between the two periods, industrial and other net revenue declined 12.3%in the three months ended September 30, 2020 decreased 2.2% on an organic basis. This decrease was driven by continued weak global industrial end markets, partially offset by growth in factory automation and medical equipment, which includes sensors to ventilator manufacturers.
For the nine months ended September 30, 2020, industrial and other net revenue decreased 10.3% compared to the prior year. Excluding a decline of 0.4% attributed to foreign exchange rate differences between the two periods, industrial and other net revenue in the nine months ended September 30, 2020 decreased 9.9% on an organic basis.
Aerospace
For the three months ended September 30, 2020, aerospace net revenue declined 2.0%,24.4% compared to the prior year on a reported and organic basis, which was negatively impacted by reduced OEM production and lower air traffic, partially offset by new product launches, primarily in the first quarter ofdefense market.
For the nine months ended September 30, 2020, versusaerospace net revenue decreased 22.2% compared to the corresponding prior-year period. 
Our industrial and other business observed a 15.0% decline in the global end-markets it serves. These market declines were primarily attributed to China, where the COVID-19 pandemic resulted in government mandated shutdowns. The key economic indicators we routinely evaluate for our industrial end-markets, such as regional PMI data, GDP, and housing starts, help develop a forward-looking view of future demand levels.  These currently indicate further deterioration in demand in the second quarter of 2020 and, as a result, we believe our industrial and other business will be adversely impacted.
While our Aerospace business generated a 2.0% organic revenue decline, end-market production was down 6.3% in the first quarter of 2020 versus the corresponding prior year period. For our aerospace business, this market outgrowth, which we define as the difference between the performance of our aerospace businesson a reported and the performance of the end-markets it serves, was primarily attributed to increased content. Expectations for future OEM commercial and defense production build rates and passenger miles flown are good indicators of future demand for our aerospace products and aftermarket services. We expect demand to be down in the second quarter of 2020 due to continued lower OEM production levels driven by COVID-19 and the worldwide travel restrictions which will continue to be in place in the second quarter of 2020.

organic basis.
Operating costs and expenses
Operating costs and expenses for the three and nine months ended March 31,September 30, 2020 and 2019 are presented, in millions of dollars and as a percentage of net revenue, in the following table. Amounts and percentages in the table below have been calculated based on unrounded numbers. Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.
For the three months ended For the three months endedFor the nine months ended
March 31, 2020 March 31, 2019 September 30, 2020September 30, 2019September 30, 2020September 30, 2019
Amount Margin* Amount Margin*AmountMargin*AmountMargin*AmountMargin*AmountMargin*
Operating costs and expenses:       Operating costs and expenses:
Cost of revenue$566.4
 73.2% $580.8
 66.7%Cost of revenue$530.3 67.3 %$554.9 65.3 %$1,509.1 70.5 %$1,711.0 65.7 %
Research and development34.5
 4.4
 35.1
 4.0
Research and development33.4 4.2 38.2 4.5 98.1 4.6 110.0 4.2 
Selling, general and administrative77.2
 10.0
 70.5
 8.1
Selling, general and administrative75.7 9.6 68.2 8.0 217.7 10.2 210.7 8.1 
Amortization of intangible assets33.1
 4.3
 36.1
 4.2
Amortization of intangible assets32.6 4.1 35.9 4.2 98.4 4.6 108.1 4.2 
Restructuring and other charges, net4.5
 0.6
 5.3
 0.6
Restructuring and other charges, net(10.5)(1.3)6.4 0.8 32.2 1.5 28.0 1.1 
Total operating costs and expenses$715.7
 92.4% $727.9
 83.6%Total operating costs and expenses$661.5 83.9 %$703.6 82.8 %$1,955.5 91.4 %$2,167.8 83.2 %
__________________________
*     Represents the amount presented divided by total net revenue.
Cost of revenue
For the three months ended March 31,September 30, 2020, cost of revenue as a percentage of net revenue increased from the prior period. The largest driverperiod primarily as a result of this increase was(1) productivity headwinds and (2) higher compensation to retain and incentivize critical employee talent, partially offset by (1) the impact of ongoing savings resulting from cost reduction activities taken in fiscal years 2019 and 2020 and (2) the favorable effect of changes in foreign currency exchange rates.
For the nine months ended September 30, 2020, cost of revenue as a percentage of net revenue increased from the prior period primarily as a result of (1) productivity headwinds from our manufacturing facilities running at lower than normal capacity and (2) a $29.2 million loss recognized in cost of revenue related to a judgment against us in an intellectual property litigation with Wasica Finance Gmbh. in the first quarter of 2020 (settled in the third quarter 2020), partially offset by (1) savings from temporary cost reductions in the second quarter (including salary reductions and furloughs), (2) the impact of ongoing savings resulting from cost reduction activities taken in fiscal years 2019 and 2020, and (3) the favorable effect of changes in foreign currency exchange rates. Refer to Note 12, "Commitments and Contingencies," of our condensed consolidated financial statements, included elsewhere in this Quarterly Report on Form 10-Q, for additional information regarding the litigation with Wasica.
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We continueexpect that the actions taken in the Q2 2020 Global Restructure Program will result in improvements of our cost of revenue as a percentage of revenue in future quarters. Refer to deny any wrongdoingQ2 2020 Global Restructure Program section earlier in this Management's Discussion and will appealAnalysis of Financial Condition and Results of Operations ("MD&A") for a more detailed discussion of this program.
Research and development ("R&D") expense
For each of the decision.three and nine months ended September 30, 2020, R&D expense decreased from the comparable periods of the prior year primarily as a result of (1) the impact of ongoing savings resulting from cost reduction activities taken in fiscal years 2019 and 2020 and (2) the favorable effect of changes in foreign currency exchange rates, somewhat offset by increased investments in our megatrend initiatives. R&D expense for the nine months ended September 30, 2020 was also reduced as a result of savings from temporary salary and furlough actions taken in the second quarter of 2020. Refer to Megatrends section earlier in this MD&A for detailed discussion of certain of our megatrends initiatives.
Selling, general and administrative ("SG&A") expense
For the three months ended September 30, 2020, SG&A expense increased from the prior year primarily as a result of (1) higher compensation to retain and incentivize critical employee talent and (2) increased costs related to enhancements and improvements to our global operating processes to increase productivity, partially offset by the impact of ongoing savings resulting from cost reduction activities taken in fiscal years 2019 and 2020.
For the nine months ended September 30, 2020, SG&A expense increased from the prior period primarily as a result of (1) increased costs related to enhancements and improvements to our global operating processes to increase productivity, (2) higher compensation to retain and incentivize critical employee talent, and (3) incremental SG&A related to acquired businesses, partially offset by (1) savings resulting from temporary salary reductions and furloughs in the second quarter of 2020 and (2) the impact of ongoing savings resulting from cost reduction activities taken in fiscal years 2019 and 2020, and (3) the favorable effect of changes in foreign currency exchange rates.
Amortization of intangible assets
For the three and nine months ended September 30, 2020, amortization expense decreased from the corresponding prior periods primarily due to the effect of the economic benefit method.
Restructuring and other charges, net
Refer to Note 5, "Restructuring and Other Charges, Net," of our condensed consolidated financial statements, included elsewhere in this Quarterly Report on Form 10-Q, for more detailed information on these charges.
Restructuring and other charges, net for the three months ended September 30, 2020 amounted to a net gain of $10.5 million, compared to a net charge of $6.4 million in the comparable period of the prior year. The net gain resulted primarily from the release of $11.7 million excess accrual related to the third quarter settlement of a patent infringement case brought against Schrader by Wasica. Refer to Note 12, "Commitments and Contingencies," of our condensed consolidated financial statements, included elsewhere in this Quarterly Report on Form 10-Q, for additional information. Other drivers of the increase included productivity headwinds and volume declines primarily resulting from the impacts of COVID-19, partially offset by the positive impact of changes in foreign currency exchange rates.
In response to the impacts we are seeing to our business due to COVID-19, we will continue to align our costs to the demand we are experiencing by ramping down certain production facilities in line with end market demand. This will be a challenge in the second quarter of 2020, as we address COVID-19 and corresponding government actions, which are creating operating restrictions, supply disruptions and increased freight costs, which will negatively impact our future cost of revenue margin. We are also taking steps to reduce discretionary spend and to reduce or delay capital expenditures for the near future.
Research and development ("R&D") expense
For the three months ended March 31, 2020, R&D expense decreased from the prior period, primarily as a result of the positive impact of changes in foreign currency exchange rates.
Selling, general and administrative ("SG&A") expense
For the three months ended March 31, 2020, SG&A expense increased from the prior period, primarily due to higher compensation to retain and incentivize critical employee talent and increased costs related to optimization of our global operating processes to increase productivity.
Amortization of intangible assets
For the three months ended March 31, 2020, amortization expense decreased from the prior period due to the effect of the economic benefit method.

Restructuring and other charges, net
Restructuring and other charges, net for the three months ended March 31,September 30, 2019 primarily related to $6.5 million of termination benefits provided under a one-time benefit arrangement in connection with the shutdown and relocation of an operating site in Germany.
Restructuring and other charges, net for the nine months ended September 30, 2020 and 2019 consistedincreased $4.2 million from the comparable period of the following (amountsprior year. Restructuring and other charges, net for the nine months ended September 30, 2020 primarily related to second quarter charges incurred under the Q2 2020 Global Restructure Program. Refer to Q2 2020 Global Restructure Program section earlier in this MD&A, and Note 5, "Restructuring and Other Charges, Net," of our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q, for detailed discussion of this program. Restructuring and other charges, net for the nine months ended September 30, 2019 included benefits provided under a voluntary retirement incentive program in the table below have been calculated based on unrounded numbers; accordingly, certain amounts may not appear to recalculate dueU.S. and termination benefits provided under a one-time benefit arrangement related to the effectshutdown and relocation of rounding):an operating site in Germany.
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 For the three months ended
(In millions)March 31, 2020 March 31, 2019
Severance costs, net (1)
$3.9
 $2.9
Other (2)
0.6
 2.5
Restructuring and other charges, net$4.5
 $5.3
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__________________________
(1)
Severance costs, net for the three months ended March 31, 2020, were primarily related to termination benefits arising from the shutdown and relocation of an operating site in Northern Ireland. Severance costs for the three months ended March 31, 2019 were primarily related to limited workforce reductions of manufacturing, engineering, and administrative positions.
(2)
Other charges in the three months ended March 31, 2020 and 2019 were primarily related to deferred compensation incurred in connection with the acquisition of GIGAVAC, LLC.
Operating income
OperatingIn the three months ended September 30, 2020, operating income decreased $84.0$19.3 million, or 58.9%13.2%, to $58.6$126.8 million (7.6%(16.1% of net revenue) compared to $146.1 million (17.2% of net revenue) in the three months ended March 31,September 30, 2019. The decrease was primarily due to (1) productivity headwinds from our manufacturing facilities operating at lower capacity, (2) lower revenue largely due to end-market contraction caused by COVID-19, (3) higher compensation costs to retain and incentivize critical employee talent, and (4) increased costs to optimize global operating processes, partially offset by (1) the release of $11.7 million excess liability upon our third quarter settlement with Wasica, (2) cost savings, primarily related to actions taken under the Q2 2020 Global Restructure Program, (3) the non-recurrence of certain restructuring charges from $142.6the third quarter of 2019, (4) lower R&D expense (net of higher megatrend spend), (5) lower amortization expense due to the impacts of the economic benefit method, and (6) the favorable effect of changes in foreign currency exchange rates.
In the nine months ended September 30, 2020, operating income decreased $252.6 million (16.4%or 57.9%, to $183.6 million (8.6% of net revenue) compared to $436.2 million (16.8% of net revenue) in the threenine months ended March 31,September 30, 2019. The declineThis decrease was primarily due to (1) lower revenues, (2) productivity headwinds from our manufacturing facilities running at lower than normal capacity, particularly in the second quarter, (3) the settlement of the patent infringement litigation brought against Schrader by Wasica, (4) the $24.1 million charge recognized in the second quarter of 2020 related to the Q2 2020 Global Restructure Program, (5) higher compensation costs to retain and incentivize critical employee talent, and (6) increased costs to optimize global operating processes. These impacts were partially offset by (1) savings of approximately $21.8 million realized in the second quarter of 2020 resulting from temporary salary reductions, furloughs, and government subsidies, (2) the non-recurrence of restructuring charges from 2019, including $12.7 million of charges related to benefits provided under a voluntary retirement incentive program, (3) lower intangible amortization expense due to the impacts of the economic benefit method, (4) the favorable effect of changes in foreign currency exchange rates, (5) cost savings, primarily related to actions taken under the Q2 2020 Global Restructure Program, and (6) lower R&D expense (net of higher megatrend spend).
We expect that the actions taken in the Q2 2020 Global Restructure Program will result in savings that will be favorable to operating income was duein future quarters. Refer to Q2 2020 Global Restructure Program section earlier in this MD&A for detailed discussion of this program.
Other, net
Other, net primarily to the impact of the global economic downturn caused by COVID-19includes currency remeasurement gains and losses on net monetary assets, gains and losses on foreign currency and commodity forward contracts not designated as well as the $29.2 million loss recognized in cost of revenuehedging instruments, losses related to a judgment against us in an intellectual property litigation with Wasica Finance Gmbh (referdebt refinancing, and the portion of our net periodic benefit cost excluding service cost. Refer to Note 12, "Commitments6, "Other, Net," of our condensed consolidated financial statements, included elsewhere in this Quarterly Report on Form 10-Q, for more detailed information on amounts included in other, net. Refer to Note 15, "Derivative Instruments and Contingencies,Hedging Activities," of our condensed consolidated financial statements, included elsewhere in this Quarterly Report on Form 10-Q, for additional information).information on amounts related to derivative instruments.
Other, net
Other, net forIn the three months ended March 31,September 30, 2020, and 2019 consistedother represented a net gain of the following (amounts$9.2 million, a favorable change of $16.8 million compared to a net loss of $7.6 million in the table below have been calculated basedthree months ended September 30, 2019. This change was driven primarily by (1) the favorable impact of changes in foreign currencies, (2) the non-recurrence of a $4.4 million loss on unrounded numbers; accordingly, certain amounts maydebt financing from the third quarter of 2019, and (3) fair value adjustments related to our commodity forward contracts, which are not appeardesignated as hedges.
In the nine months ended September 30, 2020, other represented a net loss of $1.5 million, a favorable change of $6.4 million compared to recalculatea net loss of $7.9 million in the nine months ended September 30, 2019. This change was driven primarily by (1) the favorable impact of changes in foreign currencies, (2) the non-recurrence of a $4.4 million loss on debt financing from the third quarter of 2019, and (3) fair value adjustments related to our commodity forward contracts, which are not designated as hedges. These favorable changes were partially offset by higher net periodic benefit costs, excluding service cost, due mainly to the effect of rounding):increased pension settlement losses associated with restructuring actions.
 For the three months ended
(In millions)March 31, 2020 March 31, 2019
Currency remeasurement loss on net monetary assets (1)
$1.6
 $1.9
(Loss)/gain on foreign currency forward contracts (2)
(3.8) 0.5
(Loss)/gain on commodity forward contracts(5.6) 1.1
Net periodic benefit cost, excluding service cost(4.4) (0.3)
Other(0.1) —
Other, net$(12.3) $3.2
__________________________
(1)
Relates to the remeasurement of non-USD denominated monetary assets and liabilities into USD.
(2)
Relates to changes in the fair value of derivative financial instruments not designated as hedges. Refer to Note 15, "Derivative Instruments and Hedging Activities" of our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for a more detailed discussion.
(Benefit from)/provisionProvision for income taxes
TheFor the three and nine months ended September 30, 2020, the decrease in total tax from the prior periodperiods was predominantly related to the overall decrease in income before tax as impacted by the mix of profits in the various jurisdictions in which we operate.
In response to the global financial and health crisis caused by COVID-19, the U.S. federal government enacted the CARES Act on March 27, 2020. Federal limitations on interest deductions were reduced in connection with this legislation, and we recorded a deferred tax benefit of $7.5 million in the threenine months ended March 31,September 30, 2020, as we were able to utilize additional interest expense that was previously subject to a valuation allowance.

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The (benefit from)/provision for income taxes consists of:
•current tax expense, which relates primarily to our profitable operations in non-U.S. tax jurisdictions and withholding taxes related to management fees, royalties, and the repatriation of foreign earnings; and
•deferred tax expense (or benefit), which represents adjustments in book-to-tax basis differences primarily related to (1) the step-up in fair value of fixed and intangible assets acquired in connection with business combination transactions, (2) changes in net operating loss carryforwards, (3) changes in tax rates, and (4) changes in our assessment of the realizability of our deferred tax assets.
Non-GAAP Financial Measures
This Quarterly Report on Form 10-Q includes references to organic revenue growth (or decline), which is a non-GAAP financial measure. Organic revenue growth (or decline) is defined as the reported percentage change in net revenue, calculated in accordance with U.S. GAAP, excluding the period-over-period impact of foreign exchange rate differences as well as the net impact of material acquisitions and divestitures for the 12-month period following the respective transaction date(s). Refer to the Net revenue section above for a reconciliation of organic revenue decline to reported revenue decline.
We believe that organic revenue growth (or decline) provides investors with helpful information with respect to our operating performance, and we use organic revenue growth (or decline) to evaluate our ongoing operations as well as for internal planning and forecasting purposes. We believe that organic revenue growth (or decline) provides useful information in evaluating the results of our business because it excludes items that we believe are not indicative of ongoing performance or that we believe impact comparability with the prior-year period.
Organic revenue growth (or decline) should be considered as supplemental in nature and is not intended to be considered in isolation or as a substitute for reported percentage change in net revenue calculated in accordance with U.S. GAAP. In addition, our measure of organic revenue growth (or decline) may not be the same as, or comparable to, similar non-GAAP financial measures presented by other companies.
Liquidity and Capital Resources
As of March 31,September 30, 2020 and December 31, 2019, we held cash and cash equivalents in the following regions (amounts have been calculated based on unrounded numbers; accordingly, certain amounts may not appear to recalculate due to the effect of rounding):
(In millions)March 31, 2020 December 31, 2019(In millions)September 30, 2020December 31, 2019
United Kingdom$14.4
 $8.8
United Kingdom$19.9 $8.8 
United States6.6
 7.0
United States13.1 7.0 
The Netherlands546.3
 522.9
The Netherlands1,312.9 522.9 
China121.1
 119.3
China140.6 119.3 
Other114.6
 116.1
Other123.7 116.1 
Total$803.0
 $774.1
Total$1,610.2 $774.1 
The amount of cash and cash equivalents held in these geographic regions fluctuates throughout the year due to a variety of factors, such as our use of intercompany loans and dividends and the timing of cash receipts and disbursements in the normal course of business. Our earnings are not considered to be permanently reinvested in certain jurisdictions in which they were earned. We recognize a deferred tax liability on these unremitted earnings to the extent the remittance of such earnings cannot be recovered in a tax-free manner.

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Cash Flows:
The table below summarizes our primary sources and uses of cash for the threenine months ended March 31,September 30, 2020 and 2019. We have derived the summarized statements of cash flows from the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. Amounts in the table below have been calculated based on unrounded numbers. Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.
For the three months ended For the nine months ended
(In millions)March 31, 2020 March 31, 2019(In millions)September 30, 2020September 30, 2019
Net cash provided by/(used in):   Net cash provided by/(used in):
Operating activities:   Operating activities:
Net income adjusted for non-cash items$120.1
 $167.5
Net income adjusted for non-cash items$248.7 $490.6 
Changes in operating assets and liabilities, net(21.5) (54.8)Changes in operating assets and liabilities, net44.6 (57.1)
Operating activities98.5
 112.7
Operating activities293.3 433.5 
Investing activities(32.8) (42.4)Investing activities(158.5)(160.5)
Financing activities(36.9) (150.6)Financing activities701.2 (281.5)
Net change$28.9
 $(80.3)Net change$836.1 $(8.4)
Operating activities. Net cash provided by operating activities declined from the nine months ended September 30, 2019 primarily due to lower net income, higher inventory balances, higher payments to third parties and suppliers, and timing of income tax payments,operating profitability, partially offset by timingimproved management of customer payments.working capital. Savings related to our cost-reduction activities in the second quarter were approximately $21.8 million, resulting from temporary salary reductions and furloughs. These savings are included in operating profitability.
Investing activities. Net cash used in investing activities declined fromin the first quarter ofnine months ended September 30, 2019 was primarily due toimpacted by a reduction in capital expenditures as a result of COVID-19.COVID-19, partially offset by an increase in cash used for acquisitions and cash paid for investment in equity securities. In fiscal year 2020, we anticipate capital expenditures of approximately $120.0$110.0 million to $130.0$120.0 million, a decline from previously forecasted capital expenditures, which we expect to be funded from net cash provided by operating activities.on hand.
Financing activities. Net cash used inprovided by financing activities declinedfor the nine months ended September 30, 2020 included $400.0 million of cash proceeds from the first quarterdrawdown on the Revolving Credit Facility on April 1, 2020 and $750.0 million of cash proceeds from the issuance and sale of of the 3.75% Senior Notes on August 17, 2020. A portion of the proceeds from the issuance and sale of of the 3.75% Senior Notes was used to repay our borrowings on the Revolving Credit Facility. Additionally, payments to repurchase ordinary shares decreased from $265.8 million for the nine months ended September 30, 2019 primarilyto $35.2 million for the nine months ended September 30, 2020 due to a reduction in share repurchases. On April 2, 2020 we announced athe temporary suspension of our share repurchase program, announced on April 2, 2020. The share repurchase program will continue to further enhance our financial flexibility in light of COVID-19.remain on hold until market conditions show greater improvement and stability.
Indebtedness and Liquidity:
As of March 31,September 30, 2020, we had $3,290.3$4,038.0 million in gross indebtedness, which included finance lease and other financing obligations and excluded debt discounts and deferred financing costs. We will evaluate early redemption of the 6.25% senior notes due 2026, after they first become eligible for optional redemption at a fixed redemption price in February 2021. This evaluation will depend on market and financial conditions at the time. Refer to Note 11, "Debt," of our condensed consolidated financial statements, included elsewhere in this Quarterly Report on Form 10-Q, for additional information on the components of our debt.debt, including the issue and sale of $750.0 million of the 3.75% Senior Notes on August 17, 2020.
Capital Resources
The credit agreement governing our secured credit facility (as amended, the "Credit Agreement") provides for senior secured credit facilities (the "Senior Secured Credit Facilities") consisting of a term loan facility (the "Term Loan"), the Revolving Credit Facility, and incremental availability (the "Accordion") under which additional secured credit facilities could be issued under certain circumstances.
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Our sources of liquidity include cash on hand, cash flows from operations, and available capacity under the Revolving Credit Facility. In order to enhance our financial flexibility given the general uncertainty associated with COVID-19, we withdrew $400.0 million from the Revolving Credit Facility on April 1, 2020. On August 17, 2020, we used a portion of the proceeds from the issuance and sale of $750.0 million of the 3.75% Senior Notes to repay the balance outstanding on the Revolving Credit Facility. As of September 30, 2020, we had $416.1 million available under the Revolving Credit Facility, net of $3.9 million of obligations related to outstanding letters of credit issued thereunder. Outstanding letters of credit are issued primarily for the benefit of certain operating activities. As of September 30, 2020, no amounts had been drawn against these outstanding letters of credit.
Availability under the Accordion varies each period based on our attainment of certain financial metrics as set forth in the terms of the Credit Agreement and the indentures under which our senior notes were issued (the "Senior Notes Indentures"). As of March 31,September 30, 2020, availability under the Accordion was approximately $0.9$0.6 billion.
We believe, based on our current level of operations and taking into consideration the restrictions and covenants included in the Credit Agreement and Senior Notes Indentures, that thesethe sources of liquidity described above will be sufficient to fund our operations, capital expenditures, ordinary share repurchases (if and when resumed), and debt service for at least the next twelve months. However, we cannot make assurances that our business will generate sufficient cash flows from operations or that future borrowings will be available to us in an amount sufficient to enable us to pay our indebtedness or to fund our other liquidity needs. Further, our highly-leveraged nature may limit our ability to procure additional financing in the future.
As On April 2, 2020, we announced a resulttemporary suspension of COVID-19, although we believe our financial positionshare repurchase program, which will continue to be strong, we decided to further enhance our financial flexibility by executing a $400 million drawdownremain on the Revolving Credit Facility on April 1, 2020, leaving us with cash on hand of approximately $1.2 billion on that date.

hold until market conditions show greater improvement and stability.
The Credit Agreement provides that, if our senior secured net leverage ratio exceeds a specified level, we are required to use a portion of our excess cash flow, as defined in the Credit Agreement, generated by operating, investing, or financing activities to prepay some or all of the outstanding borrowings under the Senior Secured Credit Facilities. The Credit Agreement also requires mandatory prepayments of the outstanding borrowings under the Senior Secured Credit Facilities upon certain asset dispositions and casualty events, in each case subject to certain reinvestment rights, and upon the incurrence of certain indebtedness (excluding any permitted indebtedness). These provisions were not triggered during the threenine months ended March 31,September 30, 2020.
The Credit Agreement and the Senior Notes Indentures contain restrictions and covenants that limit the ability of our wholly-owned subsidiary, Sensata Technologies B.V. ("STBV"),STBV, and certain of its subsidiaries to, among other things, incur subsequent indebtedness, sell assets, pay dividends, and make other restricted payments. For a full discussion of these restrictions and covenants, refer to Part II, Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Capital Resources," included in our Annual Report on Form 10-K for the year ended December 31, 2019.
These restrictions and covenants, which are subject to important exceptions and qualifications set forth in the Credit Agreement and Senior Notes Indentures, were taken into consideration when we established our share repurchase programs, and will be evaluated periodically with respect to future potential funding of those programs. As of March 31,September 30, 2020, we believe we were in compliance with all covenants and default provisions under our credit arrangements.
Our ability to raise additional financing, and our borrowing costs, may be impacted by short- and long-term debt ratings assigned by independent rating agencies, which are based, in significant part, on our performance as measured by certain credit metrics such as interest coverage and leverage ratios. As of April 24,October 23, 2020, Moody’s Investors Service’s corporate credit rating for STBV was Ba2 with a stable outlook and Standard & Poor’s corporate credit rating for STBV was BB+ with a negative outlook. The Standard & Poor's outlook represents a decline from our prior quartertheir outlook of "stable.""stable" as of December 31, 2019. The change in outlook reflects the uncertainties in the markets caused by COVID-19. Any future downgrades to STBV's credit ratings may increase our future borrowing costs, but will not reduce availability under the Credit Agreement.
From time to time, our Board of Directors has authorized various share repurchase programs. The authorized amount of our various share repurchase programs, which may be modified or terminated by our Board of Directors at any time. We currently have an authorized $500.0 million share repurchase program under which approximately $302.3 million remained available as of March 31,September 30, 2020. During the threenine months ended March 31,September 30, 2020, we repurchased approximately 0.9 million ordinary shares under our share repurchase program for a total purchase price of approximately $35.2 million, which are now held as treasury shares. On April 2, 2020, we announced a temporary suspension of ourthis share repurchase program, which will continue to enhance our financial flexibility in light of the uncertainties surrounding COVID-19.remain on hold until market conditions show greater improvement and stability.
Recently Issued Accounting Pronouncements
There are no recently issued accounting standards that have been adopted in the current period or will be adopted in future periods that have had or are expected to have a material impact on our consolidated financial position or results of operations.
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Critical Accounting Policies and Estimates
For a discussion of the critical accounting policies that require the use of significant judgments and estimates by management, refer to Part II, Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates" included in our Annual Report on Form 10-K for the year ended December 31, 2019.
Item 3.Quantitative and Qualitative Disclosures About Market Risk.
Item 3.Quantitative and Qualitative Disclosures About Market Risk.
No significant changes to our market risk have occurred since December 31, 2019. For a discussion of market risks affecting us, refer to Part II, Item 7A—"Quantitative and Qualitative Disclosures About Market Risk" included in our Annual Report on Form 10-K for the year ended December 31, 2019.

Item 4.Controls and Procedures.
Item 4.Controls and Procedures.
The required certifications of our Chief Executive Officer and Chief Financial Officer are included as exhibits to this Quarterly Report on Form 10-Q. The disclosures set forth in this Item 4 contain information concerning the evaluation of our disclosure controls and procedures and changes in internal control over financial reporting referred to in these certifications. These certifications should be read in conjunction with this Item 4 for a more complete understanding of the matters covered by the certifications.
Evaluation of Disclosure Controls and Procedures
With the participation of our Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures as of March 31,September 30, 2020. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the U.S. Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of March 31,September 30, 2020, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.
Changes in Internal Control over Financial Reporting
No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the three months ended March 31,September 30, 2020 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Controls
There are inherent limitations to the effectiveness of any system of internal control over financial reporting. Accordingly, even an effective system of internal control over financial reporting can only provide reasonable assurance with respect to financial statement preparation and presentation in accordance with U.S. generally accepted accounting principles. Our internal controls over financial reporting are subject to various inherent limitations, including cost limitations, judgments used in decision making, assumptions about the likelihood of future events, the soundness of our systems, the possibility of human error, and the risk of fraud. Moreover, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may be inadequate because of changes in conditions and the risk that the degree of compliance with policies or procedures may deteriorate over time.

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PART II—OTHER INFORMATION
Item 1.Legal Proceedings.
Item 1.Legal Proceedings.
We are regularly involved in a number of claims and litigation matters in the ordinary course of business. Most of our litigation matters are third-party claims related to patent infringement allegations or forof property damage allegedly caused by our products, but some involve allegations of personal injury or wrongful death. A portion of our litigation matters relate to alleged patent infringement issues. From time to time, we are also involved in disagreements with vendors and customers. Information on certain legal proceedings in which we are involved is included in Note 12, "Commitments and Contingencies" of our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. Although it is not feasible to predict the outcome of these matters, based upon our experience and current information known to us, we do not expect the outcome of these matters, either individually or in the aggregate, to have a material adverse effect on our results of operations, financial position, or cash flows.
Item 1A.Risk Factors.
Item 1A.Risk Factors.
Information regarding risk factors appears in Part I, Item 1A—"Risk Factors," in our Annual Report on Form 10-K for the year ended December 31, 2019. The information presented below updates and should be read in connection with the risk factors and information previously disclosed therein.
We are subject to various risks related to public health crises, including the global coronavirus (COVID-19) pandemic, which could have material and adverse impacts on our business, financial condition, liquidity and results of operations.
Any outbreaks of contagious diseases and other adverse public health developments in countries where we operate could have a material and adverse impact on our business, financial condition, liquidity and results of operations. For example, the COVID-19 pandemic has caused widespread disruptions to our Company in the first quarternine months of 2020. During the first quarter of 2020, these disruptions were primarily limited to our manufacturing operations in China, portions of which were closed during the end of January and first half of February due to government mandates. As the virus spread to the rest of the world beginning in March, most of our other operations outside of China also were impacted. These impacts have been materially impacted.continued to varying degrees throughout the second and third quarters, as regions have had varying levels of success mitigating the impacts of the virus, resulting in varying degrees of reopening. As of March 31,September 30, 2020, we were still experiencing significant disruptions, and at a minimum we expect those disruptions to continue throughout the second quarter of 2020. These disruptionswhich include, depending on the specific location, full or partial shutdowns of our facilities as mandated by government decree, government actions limiting our ability to adjust certain costs, significant travel restrictions, “work-from-home” orders, limited availability of our workforce, supplier constraints, supply-chain interruptions, logistics challenges and limitations, and reduced demand from certain customers.
In addition, in these challenging and dynamic circumstances, we are working to protect our employees, maintain business continuity and sustain our operations, including ensuring the safety and protection of our people who work in our plants and distribution centers across the world, many of whom support the manufacturing and delivery of products deemed part of the critical infrastructure or essential businesses by the applicable local or country governments. The extent to which the COVID-19 pandemic will continue to impact our business and financial results going forward will be dependent on future developments such as the length and severity of the crisis, the potential resurgence of the crisis, future government actions in response to the crisis and the overall impact of the COVID-19 pandemic on the global economy and capital markets, among many other factors, all of which remain highly uncertain and unpredictable.
In addition, the COVID-19 pandemic increases the likelihood and potential severity of other risks previously discussed in Part I, Item 1A. 1A—"Risk Factors," in our Annual Report on Form 10-K for our fiscalthe year ended December 31, 2019. These include, but are not limited to, the following:
•A protracted economic downturn could negatively affect the financial condition of the industries and customers we serve, which may result in an increase in bankruptcies or insolvencies, a delay in payments, and decreased sales.
•A scarcity of resources or other hardships caused by the COVID-19 pandemic may result in increased nationalism, protectionism and political tensions which may cause governments and/or other entities to take actions that may have a significant negative impact on the ability of the Company, its suppliers and its customers to conduct business.
•The impact of the COVID-19 pandemic may cause us to restructure our business or divest some of our businesses or product lines in the future, which may have a material adverse effect on our results of operations, financial condition, and cash flows.
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•To mitigate the spread of COVID-19, we have transitioned a significant subset of our employee population to a remote work environment, which may exacerbate various cybersecurity risks to our business, including an increased demand for information technology resources, an increased risk of phishing and other cybersecurity attacks, and an increased risk of unauthorized dissemination of sensitive personal information or proprietary or confidential information.
•The COVID-19 pandemic has disrupted the supply of raw materials, and we may experience increased difficulties in obtaining a consistent supply of materials at stable pricing levels.

•If the financial performance of our businesses were to decline significantly as a result of the COVID-19 pandemic, we could incur a material non-cash charge to our income statement for the impairment of goodwill and other intangible assets.
•The continued global spread of COVID-19 has led to disruption and volatility in the global capital markets, which may increase the cost of, and adversely impacted access to, capital. In addition, as a public limited company incorporated under the laws of England and Wales, we may have even less flexibility with respect to certain aspects of capital management.
•If the financial performance of our businesses were to decline significantly for an extended period of time as a result of the COVID-19 pandemic, we may face challenges to comply with the covenants contained in our credit arrangements.
As of the date of this Quarterly Report on Form10-Q,Form 10-Q, given the speed with which the COVID-19 pandemic is evolving and the uncertainty of its duration and impact, we are not able to predict the impact of the COVID-19 pandemic on our business, financial condition, liquidity and financial results, and there can be no assurance that the COVID-19 pandemic will not have a material and adverse effect on our financial results during any quarter or year in which we are affected.
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.
Issuer Purchases of Equity Securities
Period 
Total 
Number
of Shares
Purchased (in shares)
 
Weighted-Average 
Price
Paid per Share
 Total Number of
Shares Purchased as Part of Publicly
Announced Plan or Programs		 
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan or Programs
(in millions) (2)
January 1 through January 31, 2020 —
 $—
 —
 $337.5
February 1 through February 29, 2020 90,159
(1)$44.49
 89,831
 $333.5
March 1 through March 31, 2020 808,701
 $38.56
 808,701
 $302.3
Quarter total 898,860
 $39.15
 898,532
 $302.3
PeriodTotal 
Number
of Shares
Purchased (in shares)		Weighted-Average 
Price
Paid per Share		Total Number of
Shares Purchased as Part of Publicly
Announced Plan or Programs		Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan or Programs
(in millions)
July 1 through July 31, 2020— $— — $302.3 
August 1 through August 31, 2020— $— — $302.3 
September 1 through September 30, 2020498 
(1)
$42.15 — $302.3 
Quarter total498 $42.15 — $302.3 
__________________________
(1)     The number of ordinary shares presented were withheld upon the vesting of restricted securities to cover payment of employee withholding tax. These withholdings took place outside of a publicly announced repurchase plan.
(1)
Upon the vesting of restricted securities, we collect and pay withholding tax for employees by withholding shares to cover such tax. The number of shares presented includes 328 shares withheld in this manner with an aggregate value of $15 thousand, based on the closing price of our ordinary shares on the date of withholding. These withholdings took place outside of a publicly announced repurchase plan.
(2)
Other than shares withheld to cover required tax withholding upon the vesting of restricted securities, all purchases during the three months ended March 31, 2020 were conducted pursuant to a $500.0 million share repurchase program authorized by our Board of Directors and publicly announced on July 30, 2019. This share repurchase program does not have an established expiration date. On April 2, 2020, we announced a temporary suspension of our share repurchase program to enhance our financial flexibility in light of the uncertainties surrounding COVID-19.
Item 3.Defaults Upon Senior Securities.
Item 3.Defaults Upon Senior Securities.
None.

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Item 5.Other Information.
As previously reported in our Current Report on Form 8-K filed with the Securities and Exchange Commission on January 23, 2020 (the “Prior Report”), on March 1, 2020, Jeffrey Cote assumed the role
Table of our Chief Executive Officer upon the effective retirement of Martha Sullivan from that role.Contents
As reported in the Prior Report, in connection with Mr. Cote becoming our Chief Executive Officer, his annual base salary was increased to $930,000 and his annual incentive opportunity was set at 120% of his annual base salary. Effective as of March 1, 2020, Mr. Cote entered into a Third Amended and Restated Employment Agreement (the “Cote Employment Agreement”) with our subsidiary Sensata Technologies, Inc. (“STI”) to give effect to these adjustments. In addition, the Cote Employment Agreement provides for an increase to the severance payable to Mr. Cote from an amount equal to one year of his annual base salary to an amount equal to two years of his annual base salary in the event that his employment is terminated by us without “cause” or by him for “good reason” (as those terms are defined in the Cote Employment Agreement).
As also reported in the Prior Report, effective as of March 1, 2020, Ms. Sullivan assumed the role of Executive Advisor, and her annual base salary was adjusted to $472,500. On March 1, 2020, STI and Ms. Sullivan entered into a Third Amended and Restated Employment Agreement (the “Sullivan Employment Agreement”) to give effect to this change and the other changes described in the Prior Report. In addition, we and Ms. Sullivan entered into an Amendment to Martha Sullivan Award Agreements dated February 29, 2020 (the “Sullivan Award Amendment”), to provide for the previously announced amendment to Ms. Sullivan’s stock option awards granted from 2013 through 2018 to allow for their continued exercisability until 60 days after her service as a director on our Board ends.
The foregoing description of the Cote Employment Agreement, the Sullivan Employment Agreement, and the Sullivan Award Amendment is a summary and is qualified in its entirety by reference to the full text of the Cote Employment Agreement, the Sullivan Employment Agreement, and the Sullivan Award Amendment, which are attached to this Quarterly Report on Form 10-Q as Exhibits 10.1, 10.2 and 10.3, respectively, and are incorporated herein by reference.

Item 6.Exhibits.
Item 6.Exhibit No.Exhibits.
Description
4.1Description4.1 of the Registrant's Current Report on Form 8-K filed on August 20, 2020).
10.1
10.2
10.210.3
10.3
Amendment to Martha Sullivan Award Agreements withfor Restricted Stock Units under the Sensata Technologies Holding plc dated February 29, 2020. *†
10.4
First Amended and Restated Employment2010 Equity Incentive Plan. *†
10.4
10.5
Holding plc First Amended and Restated Employment2010 Equity Incentive Plan. *†
10.5
10.6
Holding plc First Amended and Restated Employment Agreement between Hans Lidforss and Sensata Technologies Inc., dated March 5, 2020.2010 Equity Incentive Plan. *†
10.731.1
31.1
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2
32.1
101.INSInline 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.SCHInline XBRL Taxonomy Extension Schema Document. *
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document. *
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document. *
101.LABInline XBRL Taxonomy Extension Label Linkbase Document. *
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document. *
104Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
___________________________
*    Filed herewith
†    Indicates management contract or compensatory plan, contract, or arrangement


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Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Date: April 29,October 27, 2020

SENSATA TECHNOLOGIES HOLDING PLC
/s/ Jeffrey Cote
(Jeffrey Cote)
President and Chief Executive Officer and President
(Principal Executive Officer)
/s/ Paul Vasington
(Paul Vasington)
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)


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