# 3M Co: Form 10-Q for the period ended Sep 30, 2024

- Company: [3M Co](/companies/mmm.md) (CIK 66740)
- Form: 10-Q
- Filed: 2024-10-22
- Accepted by EDGAR: Oct 22, 2024, 11:48 ET
- Period: 2024-09-30
- Accession: 0000066740-24-000101
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/66740/000006674024000101/mmm-20240930.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/66740/000006674024000101/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2024-09-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2024-07-01 to 2024-09-30 | $6.29bn | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Revenue | 9 months, 2024-01-01 to 2024-09-30 | $18.57bn | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Cost of revenue | 3 months, 2024-07-01 to 2024-09-30 | $3.65bn | us-gaap:CostOfRevenue |
| Cost of revenue | 9 months, 2024-01-01 to 2024-09-30 | $10.70bn | us-gaap:CostOfRevenue |
| Selling, general and administrative | 3 months, 2024-07-01 to 2024-09-30 | $1.06bn | us-gaap:SellingGeneralAndAdministrativeExpense |
| Selling, general and administrative | 9 months, 2024-01-01 to 2024-09-30 | $3.32bn | us-gaap:SellingGeneralAndAdministrativeExpense |
| Operating income | 3 months, 2024-07-01 to 2024-09-30 | $1.32bn | us-gaap:OperatingIncomeLoss |
| Operating income | 9 months, 2024-01-01 to 2024-09-30 | $3.74bn | us-gaap:OperatingIncomeLoss |
| Interest expense | 3 months, 2024-07-01 to 2024-09-30 | $276.0m | us-gaap:InterestExpenseNonoperating |
| Interest expense | 9 months, 2024-01-01 to 2024-09-30 | $939.0m | us-gaap:InterestExpenseNonoperating |
| Income tax | 3 months, 2024-07-01 to 2024-09-30 | $348.0m | us-gaap:IncomeTaxExpenseBenefit |
| Income tax | 9 months, 2024-01-01 to 2024-09-30 | $771.0m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2024-07-01 to 2024-09-30 | $1.37bn | us-gaap:NetIncomeLoss |
| Net income | 9 months, 2024-01-01 to 2024-09-30 | $3.44bn | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2024-07-01 to 2024-09-30 | $2.48 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 9 months, 2024-01-01 to 2024-09-30 | $6.21 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2024-07-01 to 2024-09-30 | $2.49 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 9 months, 2024-01-01 to 2024-09-30 | $6.23 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2024-07-01 to 2024-09-30 | 552,700,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 9 months, 2024-01-01 to 2024-09-30 | 554,500,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 9 months, 2024-01-01 to 2024-09-30 | $1.0m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 9 months, 2024-01-01 to 2024-09-30 | $890.0m | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Dividends paid | 9 months, 2024-01-01 to 2024-09-30 | $1.60bn | us-gaap:PaymentsOfDividendsCommonStock |
| Share repurchases | 9 months, 2024-01-01 to 2024-09-30 | $1.10bn | us-gaap:PaymentsForRepurchaseOfCommonStock |
| Current assets | at 2024-09-30 | $16.30bn | us-gaap:AssetsCurrent |
| Total assets | at 2024-09-30 | $40.88bn | us-gaap:Assets |
| Current liabilities | at 2024-09-30 | $11.39bn | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2024-09-30 | $36.18bn | us-gaap:Liabilities |
| Long-term debt | at 2024-09-30 | $11.32bn | us-gaap:LongTermDebtNoncurrent |
| Current portion of debt | at 2024-09-30 | $1.87bn | us-gaap:DebtCurrent |
| Shareholders' equity | at 2024-09-30 | $4.64bn | us-gaap:StockholdersEquity |
| Shares outstanding | at 2024-09-30 | 544,558,607 shares | dei:EntityCommonStockSharesOutstanding |

## Management's discussion and analysis

As filed, 76,792 characters.

Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) is designed to provide a reader of 3M’s financial statements with a narrative from the perspective of management. 3M’s MD&A is presented in the following sections:

- Overview
- Results of Operations
- Performance by Business Segment
- Financial Condition and Liquidity
- Cautionary Note Concerning Factors That May Affect Future Results

The term "N/M" used herein references "not meaningful" for certain percent changes.

Forward-looking statements in Part I, Item 2 may involve risks and uncertainties that could cause results to differ materially from those projected (refer to the section entitled *Cautionary Note Concerning Factors That May Affect Future Results* in Part I, Item 2 and the risk factors provided in Part II, Item 1A for discussion of these risks and uncertainties).

### Overview

3M is a diversified global manufacturer, technology innovator and marketer of a wide variety of products and services. Certain changes are reflective in this document for all applicable periods presented. These include:

- As discussed in Note 2, on April 1, 2024, 3M completed the previously announced separation of its Health Care business (the Separation) through a pro rata distribution of 80.1% of the outstanding shares of Solventum Corporation (Solventum) to 3M stockholders. As a result of the Separation, Solventum became an independent public company and 3M no longer consolidates Solventum into 3M’s financial results. In connection with the Separation, the historical net income of Solventum and applicable assets and liabilities included in the Separation are reported in 3M's consolidated financial statements as discontinued operations.
- 3M made certain changes to the composition of segment information reviewed by 3M's chief operating decision maker (CODM) effective in the second quarter of 2024 largely as a result of the separation of Solventum and changes within its business segments effective in the first quarter of 2024 as further described in Note 19. To the extent these changes impacted 3M's disclosed disaggregated revenue information, data in Note 3 has also been updated.

3M manages its continuing operations in three operating business segments: Safety and Industrial; Transportation and Electronics; and Consumer. From a geographic perspective, any references to EMEA refer to Europe, Middle East and Africa on a combined basis. References are made to organic sales change (which include both organic volume impacts and selling price impacts), which is defined as the change in net sales, absent the separate impacts on sales from foreign currency translation and acquisitions, net of divestitures. Acquisition and divestiture sales change impacts, if any, are measured separately for the first twelve months post-transaction and, beginning April 2024, include the impact of commercial agreements associated with the separation of Solventum. 3M believes this information is useful to investors and management in understanding ongoing operations and in analysis of ongoing operating trends.

3M is impacted by certain special items such as costs for significant litigation and the sales and income associated with manufactured PFAS products. See *Certain amounts adjusted for special items - (non-GAAP measures)* section below for additional discussion of these and other special items, including references therein to where further information is provided.

Additional information regarding certain items impacting pre-2024 periods that may also be relevant in 2024 can be found in the Overview section of Part II, Item 7 as well as in further sections of 3M’s 2023 Annual Report on Form 10-K.

***Earnings (loss) from continuing operations per share attributable to 3M common shareholders – diluted:*** The following table provides the increases (decreases) in diluted earnings (loss) from continuing operations per share.

| Earnings (loss) from continuing operations per diluted share | Three months ended September 30, 2024 | Nine months ended September 30, 2024 |
| --- | ---: | ---: |
| Same period last year | $(4.56) | $(16.32) |
| Net costs for significant litigation | 6.13 | 20.64 |
| Divestiture costs | 0.01 | 0.02 |
| Gain on business divestitures | (0.05) | (0.05) |
| Russia exit charges (benefits) | — | (0.04) |
| Manufactured PFAS products | 0.15 | 0.08 |
| Total special items | 6.24 | 20.65 |
| Same period last year, excluding special items | $1.68 | $4.33 |
| Increase/(decrease) due to: |  |  |
| Total organic growth/productivity and other | 0.13 | 0.92 |
| Restructuring and related charges | 0.02 | 0.14 |
| Foreign exchange impacts | (0.03) | (0.13) |
| Acquisitions | 0.02 | 0.05 |
| Other expense (income), net | 0.04 | 0.23 |
| Income tax rate | 0.11 | 0.08 |
| Shares of common stock outstanding | 0.01 | — |
| Current period, excluding special items | 1.98 | 5.62 |
| Net costs for significant litigation | (0.51) | (1.39) |
| Divestiture costs | — | (0.24) |
| Manufactured PFAS products | (0.04) | (0.04) |
| Pension risk transfer cost | — | (1.09) |
| Solventum ownership benefit from change in value | 1.05 | 3.06 |
| Total special items | 0.50 | 0.30 |
| Current period | $2.48 | $5.92 |

The Company refers to various "adjusted" amounts or measures on an “adjusted" basis. These exclude special items. These non-GAAP measures are further described and reconciled to the most directly comparable GAAP financial measures in the *Certain amounts adjusted for special items - (non-GAAP measures)* section below.

A discussion related to the components of year-on-year changes in earnings (loss) from continuing operations per diluted share follows:

#### Total organic growth/productivity and other:

- For the third quarter of 2024, the following components impacted operating margins and earnings (loss) from continuing operations per diluted share year-on-year:
- Benefits from organic growth, continued productivity and restructuring resulted in a net year-on-year increase of $0.12 per share
- Income from transition service agreements with Solventum (refer to Note 2 for additional discussion) resulted in a net year-on-year increase of $0.01 per share
- For the first nine months of 2024, the following components impacted operating margins and earnings (loss) from continuing operations per diluted share year-on-year:
- Benefits from organic growth, productivity, strong spending discipline and restructuring resulted in a net year-on-year increase of $0.79 per share
- Nonrecurring items including gain on property sales resulted in a net year-on-year increase of $0.08 per share.
- Income from transition services agreements with Solventum (refer to Note 2 for additional discussion) resulted in a net year-on-year increase of $0.05 per share

#### Restructuring and related charges:

- 3M recorded restructuring pre-tax charges of $40 million and $178 million in the third quarter and first nine months of 2024, respectively, compared to $58 million and $310 million in the same periods last year, respectively, (refer to Note 6 for additional discussion). In addition, 3M recorded certain related pre-tax adjustments, accelerated depreciation and other charges of $8 million and $34 million in the third quarter and first nine months of 2024, respectively.

#### Foreign exchange impacts:

- Foreign currency impacts (net of hedging) decreased operating income from continuing operations by approximately $18 million (or a decrease of pre-tax income from continuing operations by approximately $25 million) year-on-year for the third quarter of 2024 and decreased operating income from continuing operations by approximately $91 million (or a decrease of pre-tax income from continuing operations by approximately $107 million) year-on-year for the first nine months of 2024. These estimates include: (a) the effects of year-on-year changes in exchange rates on translating current period functional currency profits into U.S. dollars and on current period non-functional currency denominated purchases or transfers of goods between 3M operations, and (b) year-on-year changes in transaction gains and losses, including derivative instruments designed to reduce foreign currency exchange rate risks.

#### Acquisitions/divestitures:

- Impacts relate to:
- Divestiture impacts include the effect of new commercial agreements associated with the April 2024 separation of Solventum.
- Reconsolidation of Aearo entities - in the third quarter of 2022, 3M deconsolidated the Aearo Entities and, in the second quarter of 2023, reconsolidated those entities (discussed in Note 17). For each of the 12-months post-deconsolidation and post-reconsolidation, impacts are each reflected separately as divestiture and acquisition, respectively.

#### Other expense (income), net:

- Interest expense (net of interest income) included in other expense (income), net as presented above decreased for the third quarter and first nine months of 2024 compared to the same period year-on-year.
- Lower income related to non-service cost components of pension and postretirement expense increased expense year-on-year for the third quarter and first nine months of 2024.

#### Income tax rate:

- Certain items above reflect specific income tax rates associated therewith. Overall, the effective tax rate for the third quarter of 2024 was 20.3 percent on a pre-tax income, compared to 23.5 percent on pre-tax loss in the prior year. The effective tax rate for the first nine months of 2024 was 19.0 percent, compared to 24.3 percent in the prior year. The primary factors that impacted the comparison of these rates year-over-year were the third quarter 2023 charge related to the settlement agreement to resolve CAE litigation (see Note 17), second quarter 2023 charge related to the settlement agreement with public water systems in the United States regarding PFAS (see Note 17), and the tax rate associated with the 2024 benefit related to the change in value of the retained ownership interest in Solventum.
- On an adjusted basis (as discussed below), the effective tax rate for the third quarter and first nine months of 2024 was 20.5% and 20.1%, respectively, a decrease of 4.3 percentage points and a decrease of 1.1 percentage points, respectively, compared to the same period year-on-year.

#### Shares of common stock outstanding:

- Shares outstanding impacted earnings (loss) from continuing operations per share year-on-year.

***Certain amounts adjusted for special items - (non-GAAP measures):*** In addition to reporting financial results in accordance with U.S. GAAP, 3M also provides certain non-GAAP measures. These measures are not in accordance with, nor are they a substitute for GAAP measures, and may not be comparable to similarly titled measures used by other companies.

Certain measures adjust for the impacts of special items. Special items for the periods presented include the items described in the section entitled “Description of special items”. Because 3M provides certain information with respect to business segments, it is noteworthy that special items impacting operating income (loss) are reflected in Corporate and Unallocated, except as described with respect to net costs for significant litigation and manufactured PFAS products items in the “Description of special items” section. The reconciliations below, therefore, also include impacted segments as applicable.

This document contains measures for which 3M provides the reported GAAP measure and a non-GAAP measure adjusted for special items. The document also contains additional measures which are not defined under U.S. GAAP. These measures and reasons 3M believes they are useful to investors (and, as applicable, used by 3M) include:

| GAAP amounts for which a measure adjusted for special items is also provided: | Reasons 3M believes the measure is useful |
| --- | --- |
| •Net sales (and sales change) | Considered, in addition to segment operating performance, in evaluating and managing operations; useful in understanding underlying business performance, provides additional transparency to special items |
| •Operating income (loss), segment operating income (loss) and operating income (loss) margin |  |
| •Income (loss) from continuing operations before taxes |  |
| •Provision for income taxes and effective tax rate |  |
| •Net income (loss) from continuing operations |  |
| •Earnings (loss) per share from continuing operations |  |

Special items for the periods presented include:

#### Net costs for significant litigation:

- These relate to 3M's respirator mask/asbestos (which include Aearo and non-Aearo items), PFAS-related other environmental, and Combat Arms Earplugs matters (as discussed in Note 17). Net costs include the impacts of changes in accrued liabilities (including interest imputation on applicable settlement obligations), external legal fees, and insurance recoveries, along with the associated tax impacts. Associated tax impacts of significant litigation include impacts on Foreign Derived Intangible Income (FDII), Global Intangible Low Taxed Income (GILTI), foreign tax credits and tax costs of repatriation. 3M does not consider the elements of the net costs associated with these matters to be normal, operating expenses related to the Company’s ongoing operations, revenue generating activities, business strategy, industry, and regulatory environment. Net costs related to respirator mask/asbestos are reflected as special items in the Safety and Industrial business segment while those impacting operating income (loss) associated with PFAS-related other environmental and Combat Arms Earplugs matters are reflected as corporate special items in Corporate and Unallocated. In addition, during the voluntary chapter 11 bankruptcy period (which began in July 2022 and ended in June 2023—see Note 17), costs associated with the Aearo portion of respirator mask/asbestos matters were reflected in corporate special items in Corporate and Unallocated. Prior to the bankruptcy, costs associated with Combat Arms Earplugs matters were reflected as part of special items in the Safety and Industrial business segment.

#### Divestiture costs:

- These include certain limited costs that were not eligible to be included within discontinued operations related to separating and divesting substantially an entire business segment of 3M following public announcement of its intended divestiture. As a result of completion of the April 2024 separation of Solventum, this includes the tax cost of update to 3M’s previous indefinite reinvestment plans on past unrepatriated earnings through the period of the Separation’s close and to tax positions retained by 3M.

#### Manufactured PFAS products:

- These amounts relate to sales and estimates of income (loss) regarding manufactured PFAS products that 3M plans to exit by the end of 2025 included within the Transportation and Electronics business segment. Along with other costs in arriving at this associated income, these amounts include estimates of costs of sales of $210 million and $348 million for the three months ended September 30, 2024 and 2023, respectively, and $626 million and $857 million for the nine months ended September 30, 2024 and 2023, respectively. Estimated income does not contemplate impacts on non-operating items such as net interest income/expense and the non-service cost components portion of defined benefit plan net periodic benefit costs.

#### Russia exit charges/benefits:

- In the second quarter of 2023, 3M recorded a gain on final disposal of net assets in Russia. Previously, in the third quarter of 2022, 3M recorded a charge primarily related to impairment of these assets in connection with management's committed exit and disposal plan.

#### Pension risk transfer charge:

- In the second quarter of 2024, 3M recorded a non-cash pension settlement charge reflected in other expense (income), net as a result of transferring a portion of its U.S. pension payment obligations and related plan assets to an insurance company (as discussed in Note 13).

#### Solventum ownership - change in value:

- This amount relates to the change in value of 3M's retained ownership interest in Solventum common stock reflected in other expense (income), net.

*(Dollars in millions, except per share amounts)*

| Safety and Industrial | Three months ended September 30, 2023 Net sales | Operating income (loss) | Operating income (loss) margin | Income (loss) from continuing operations before taxes | Provision (benefit) for income taxes | Effective tax rate | Net income (loss) from continuing operations attributable to 3M | Earnings (loss) from continuing operations per diluted share |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| GAAP amounts |  | $666 | 24.2% |  |  |  |  |  |
| Adjustments for special items: |  |  |  |  |  |  |  |  |
| Net costs for significant litigation |  | 42 |  |  |  |  |  |  |
| Total special items |  | 42 |  |  |  |  |  |  |
| Adjusted amounts (non-GAAP measures) |  | $708 | 25.7% |  |  |  |  |  |
| **Transportation and Electronics** |  |  |  |  |  |  |  |  |
| GAAP amounts | $2,171 | $389 | 17.9% |  |  |  |  |  |
| Adjustments for special items: |  |  |  |  |  |  |  |  |
| Manufactured PFAS products | (292) | 105 |  |  |  |  |  |  |
| Total special items | (292) | 105 |  |  |  |  |  |  |
| Adjusted amounts (non-GAAP measures) | $1,879 | $494 | 26.3% |  |  |  |  |  |
| **Total Company** |  |  |  |  |  |  |  |  |
| GAAP amounts | $6,270 | $(3,096) | (49.4)% | $(3,302) | $(777) | 23.5% | $(2,527) | $(4.56) |
| Adjustments for special items: |  |  |  |  |  |  |  |  |
| Net costs for significant litigation3 | — | 4,312 |  | 4,469 | 1,068 |  | 3,401 | 6.13 |
| Manufactured PFAS products | (292) | 105 |  | 105 | 25 |  | 80 | 0.15 |
| Gain on business divestitures | — | (36) |  | (36) | (11) |  | (25) | (0.05) |
| Divestiture costs | — | 7 |  | 7 | 2 |  | 5 | 0.01 |
| Total special items | (292) | 4,388 |  | 4,545 | 1,084 |  | 3,461 | 6.24 |
| Adjusted amounts (non-GAAP measures) | $5,978 | $1,292 | 21.6% | $1,243 | $307 | 24.8% | $934 | $1.68 |

3For the per share amount, this includes adjusting-out the impact of this item causing weighted average shares outstanding to be the same for both basic and diluted loss per share in periods of resulting net losses.

*(Dollars in millions, except per share amounts)*

| Safety and Industrial | Three months ended September 30, 2024 Net sales | Sales change | Operating income (loss) | Operating income (loss) margin | Income (loss) from continuing operations before taxes | Provision (benefit) for income taxes | Effective tax rate | Net income (loss) from continuing operations attributable to 3M | Earnings (loss) from continuing operations per diluted share | Earnings (loss) from continuing operations per diluted share percent change |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| GAAP amounts |  |  | **$650** | **23.5%** |  |  |  |  |  |  |
| Adjustments for special items: |  |  |  |  |  |  |  |  |  |  |
| Net costs for significant litigation |  |  | **22** |  |  |  |  |  |  |  |
| Total special items |  |  | **22** |  |  |  |  |  |  |  |
| Adjusted amounts (non-GAAP measures) |  |  | **$672** | **24.3%** |  |  |  |  |  |  |
| **Transportation and Electronics** |  |  |  |  |  |  |  |  |  |  |
| GAAP amounts | **$2,139** | **(1.5)%** | **$436** | **20.4%** |  |  |  |  |  |  |
| Adjustments for special items: |  |  |  |  |  |  |  |  |  |  |
| Manufactured PFAS products | **(226)** |  | **34** |  |  |  |  |  |  |  |
| Total special items | **(226)** |  | **34** |  |  |  |  |  |  |  |
| Adjusted amounts (non-GAAP measures) | **$1,913** | **1.8%** | **$470** | **24.5%** |  |  |  |  |  |  |
| **Total Company** |  |  |  |  |  |  |  |  |  |  |
| GAAP amounts | **$6,294** | **0.4%** | **$1,316** | **20.9%** | **$1,721** | **$348** | **20.3%** | **$1,372** | **$2.48** | **154%** |
| Adjustments for special items: |  |  |  |  |  |  |  |  |  |  |
| Net costs for significant litigation | **—** |  | **47** |  | **204** | **(75)** |  | **279** | **0.51** |  |
| Manufactured PFAS products | **(226)** |  | **34** |  | **34** | **9** |  | **25** | **0.04** |  |
| Solventum ownership - change in value | **—** |  | **—** |  | **(581)** | **—** |  | **(581)** | **(1.05)** |  |
| Total special items | **(226)** |  | **81** |  | **(343)** | **(66)** |  | **(277)** | **(0.50)** |  |
| Adjusted amounts (non-GAAP measures) | **$6,068** | **1.5%** | **$1,397** | **23.0%** | **$1,378** | **$282** | **20.5%** | **$1,095** | **$1.98** | **18%** |

52

| Sales Change | Three months ended September 30, 2024 Organic sales | Acquisitions | Divestitures | Translation | Total sales change |
| --- | ---: | ---: | ---: | ---: | ---: |
| Total Company | (0.1)% | —% | 0.8% | (0.3)% | 0.4% |
| Remove manufactured PFAS products special item impact | 1.1 | — | 0.1 | (0.1) | 1.1 |
| Adjusted total Company (non-GAAP measures) | 1.0% | —% | 0.9% | (0.4)% | 1.5% |
| Transportation and Electronics | (1.2)% | —% | —% | (0.3)% | (1.5)% |
| Remove manufactured PFAS products special item impact | 3.2 | — | — | 0.1 | 3.3 |
| Adjusted Transportation and Electronics (non-GAAP measures) | 2.0% | —% | —% | (0.2)% | 1.8% |

*(Dollars in millions, except per share amounts)*

| Safety and Industrial | Nine months ended September 30, 2023 Net sales | Operating income (loss) | Operating income (loss) margin | Income (loss) from continuing operations before taxes | Provision (benefit) for income taxes | Effective tax rate | Net income (loss) from continuing operations attributable to 3M | Earnings (loss) from continuing operations per diluted share |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| GAAP amounts |  | $1,801 | 21.7% |  |  |  |  |  |
| Adjustments for special items: |  |  |  |  |  |  |  |  |
| Net costs for significant litigation |  | 83 |  |  |  |  |  |  |
| Total special items |  | 83 |  |  |  |  |  |  |
| Adjusted amounts (non-GAAP measures) |  | $1,884 | 22.7% |  |  |  |  |  |
| **Transportation and Electronics** |  |  |  |  |  |  |  |  |
| GAAP amounts | $6,412 | $1,093 | 17.0% |  |  |  |  |  |
| Adjustments for special items: |  |  |  |  |  |  |  |  |
| Manufactured PFAS products | (969) | 54 |  |  |  |  |  |  |
| Total special items | (969) | 54 |  |  |  |  |  |  |
| Adjusted amounts (non-GAAP measures) | $5,443 | $1,147 | 21.1% |  |  |  |  |  |
| **Total Company** |  |  |  |  |  |  |  |  |
| GAAP amounts | $18,608 | $(11,588) | (62.3)% | $(11,922) | $(2,893) | 24.3% | $(9,036) | $(16.32) |
| Adjustments for special items: |  |  |  |  |  |  |  |  |
| Net costs for significant litigation3 | — | 14,792 |  | 14,961 | 3,532 |  | 11,429 | 20.64 |
| Manufactured PFAS products | (969) | 54 |  | 54 | 12 |  | 42 | 0.08 |
| Gain on business divestitures | — | (36) |  | (36) | (11) |  | (25) | (0.05) |
| Russia exit charges (benefits) | — | (18) |  | (18) | 3 |  | (21) | (0.04) |
| Divestiture costs | — | 11 |  | 11 | 2 |  | 9 | 0.02 |
| Total special items | (969) | 14,803 |  | 14,972 | 3,538 |  | 11,434 | 20.65 |
| Adjusted amounts (non-GAAP measures) | $17,639 | $3,215 | 18.2% | $3,050 | $645 | 21.2% | $2,398 | $4.33 |

*(Dollars in millions, except per share amounts)*

| Safety and Industrial | Nine months ended September 30, 2024 Net sales | Sales change | Operating income (loss) | Operating income (loss) margin | Income (loss) from continuing operations before taxes | Provision (benefit) for income taxes | Effective tax rate | Net income (loss) from continuing operations attributable to 3M | Earnings (loss) from continuing operations per diluted share | Earnings (loss) from continuing operations per diluted share percent change |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| GAAP amounts |  |  | **$1,919** | **23.2%** |  |  |  |  |  |  |
| Adjustments for special items: |  |  |  |  |  |  |  |  |  |  |
| Net costs for significant litigation |  |  | **40** |  |  |  |  |  |  |  |
| Total special items |  |  | **40** |  |  |  |  |  |  |  |
| Adjusted amounts (non-GAAP measures) |  |  | **$1,959** | **23.7%** |  |  |  |  |  |  |
| **Transportation and Electronics** |  |  |  |  |  |  |  |  |  |  |
| GAAP amounts | **$6,386** | **(0.4)%** | **$1,345** | **21.1%** |  |  |  |  |  |  |
| Adjustments for special items: |  |  |  |  |  |  |  |  |  |  |
| Manufactured PFAS products | **(743)** |  | **30** |  |  |  |  |  |  |  |
| Total special items | **(743)** |  | **30** |  |  |  |  |  |  |  |
| Adjusted amounts (non-GAAP measures) | **$5,643** | **3.7%** | **$1,375** | **24.4%** |  |  |  |  |  |  |
| **Total Company** |  |  |  |  |  |  |  |  |  |  |
| GAAP amounts | **$18,565** | **(0.2)%** | **$3,737** | **20.1%** | **$4,060** | **$771** | **19.0%** | **$3,281** | **$5.92** | **136%** |
| Adjustments for special items: |  |  |  |  |  |  |  |  |  |  |
| Net costs for significant litigation | **—** |  | **136** |  | **699** | **(69)** |  | **768** | **1.39** |  |
| Manufactured PFAS products | **(743)** |  | **30** |  | **30** | **7** |  | **23** | **0.04** |  |
| Divestiture costs | **—** |  | **20** |  | **20** | **(111)** |  | **131** | **0.24** |  |
| Solventum ownership - change in value | **—** |  | **—** |  | **(1,694)** | **—** |  | **(1,694)** | **(3.06)** |  |
| Pension risk transfer charge | **—** |  | **—** |  | **795** | **188** |  | **607** | **1.09** |  |
| Total special items | **(743)** |  | **186** |  | **(150)** | **15** |  | **(165)** | **(0.30)** |  |
| Adjusted amounts (non-GAAP measures) | **$17,822** | **1.0%** | **$3,923** | **22.0%** | **$3,910** | **$786** | **20.1%** | **$3,116** | **$5.62** | **30%** |

53

| Sales Change | Nine months ended September 30, 2024 Organic sales | Acquisitions | Divestitures | Translation | Total sales change |
| --- | ---: | ---: | ---: | ---: | ---: |
| Total Company | (0.2)% | 0.3% | 0.5% | (0.8)% | (0.2)% |
| Remove manufactured PFAS products special item impact | 1.2 | — | 0.1 | (0.1) | 1.2 |
| Adjusted total Company (non-GAAP measures) | 1.0% | 0.3% | 0.6% | (0.9)% | 1.0% |
| Transportation and Electronics | —% | 0.8% | —% | (1.2)% | (0.4)% |
| Remove manufactured PFAS products special item impact | 3.9 | 0.1 | — | 0.1 | 4.1 |
| Adjusted Transportation and Electronics (non-GAAP measures) | 3.9% | 0.9% | —% | (1.1)% | 3.7% |

***Sales and operating income (loss) by business segment:*** The following tables contain sales and operating income (loss) results by business segment for the three and nine months ended September 30, 2024 and 2023. Refer to the section entitled *Performance by Business Segment* later in MD&A for additional discussion concerning 2024 versus 2023 results, including Corporate and Unallocated and Other. Corporate and Unallocated and Other are not reportable business segments as they do not meet the segment reporting criteria. Refer to Note 19 for additional information on business segments.

*(Dollars in millions)*

|  | Three months ended September 30, 2024 Net Sales Operating Income (Loss) | 2023 Net Sales Operating Income (Loss) | % change Net Sales Operating Income (Loss) |
| --- | ---: | ---: | ---: |
| Safety and Industrial | **$2,767** **$650** | $2,751 $666 | **0.5%** **(2.4)%** |
| Transportation and Electronics | **2,139** **436** | 2,171 389 | **(1.5)** **11.8** |
| Consumer | **1,299** **263** | 1,315 269 | **(1.2)** **(2.5)** |
| Corporate and Unallocated | **81** **(39)** | 26 (4,426) |  |
| Other | **8** **6** | 7 6 |  |
| Total Company | **$6,294** **$1,316** | $6,270 $(3,096) | **0.4%** **N/M** |
|  | **Nine months ended September 30,** |  |  |
|  | **2024** | **2023** | **% change** |
| **(Dollars in millions)** | **Net Sales** **Operating Income (Loss)** | **Net Sales** **Operating Income (Loss)** | **Net Sales** **Operating Income (Loss)** |
| Safety and Industrial | **$8,258** **$1,919** | $8,295 $1,801 | **(0.5)%** **6.5%** |
| Transportation and Electronics | **6,386** **1,345** | 6,412 1,093 | **(0.4)** **23.0** |
| Consumer | **3,702** **698** | 3,800 683 | **(2.6)** **2.2** |
| Corporate and Unallocated | **193** **(203)** | 71 (15,190) |  |
| Other | **26** **(22)** | 30 25 |  |
| Total Company | **$18,565** **$3,737** | $18,608 $(11,588) | **(0.2)%** **N/M** |

| Worldwide Sales Change By Business Segment | Three months ended September 30, 2024 Organic sales | Acquisitions | Divestitures | Translation | Total sales change |
| --- | ---: | ---: | ---: | ---: | ---: |
| Safety and Industrial | 0.9% | —% | —% | (0.4)% | 0.5% |
| Transportation and Electronics | (1.2) | — | — | (0.3) | (1.5) |
| Consumer | (0.7) | — | — | (0.5) | (1.2) |
|  | **Nine months ended September 30, 2024** |  |  |  |  |
| **Worldwide Sales Change By Business Segment** | **Organic sales** | **Acquisitions** | **Divestitures** | **Translation** | **Total sales change** |
| Safety and Industrial | 0.2% | —% | —% | (0.7)% | (0.5)% |
| Transportation and Electronics | — | 0.8 | — | (1.2) | (0.4) |
| Consumer | (2.0) | — | — | (0.6) | (2.6) |

Refer to the *Certain amounts adjusted for special items - (non-GAAP measures)* section for additional details on the impact of special items on sales (and sales change) and operating income (loss) by business segment.

***Sales by geographic area:*** Percent change information compares the three and nine months ended September 30, 2024 with the same prior year period, unless otherwise indicated. Additional discussion of business segment results is provided in the *Performance by Business Segment* section.

|  | Three months ended September 30, 2024 Americas | Asia Pacific | Europe, Middle East & Africa | Worldwide |
| --- | ---: | ---: | ---: | ---: |
| Net sales (millions) | $3,484 | $1,783 | $1,027 | $6,294 |
| % of worldwide sales | 55.4% | 28.3% | 16.3% | 100.0% |
| Components of net sales change: |  |  |  |  |
| Organic sales | 0.3 | 1.7 | (4.2) | (0.1) |
| Divestitures | 1.2 | 0.1 | 0.5 | 0.8 |
| Translation | (0.8) | (0.4) | 1.3 | (0.3) |
| Total sales change | 0.7% | 1.4% | (2.4)% | 0.4% |
|  | **Nine months ended September 30, 2024** |  |  |  |
|  | **Americas** | **Asia Pacific** | **Europe, Middle East & Africa** | **Worldwide** |
| Net sales (millions) | $10,114 | $5,272 | $3,179 | $18,565 |
| % of worldwide sales | 54.5% | 28.4% | 17.1% | 100.0% |
| Components of net sales change: |  |  |  |  |
| Organic sales | (0.3) | 1.3 | (2.5) | (0.2) |
| Acquisitions | 0.5 | 0.1 | — | 0.3 |
| Divestitures | 0.9 | — | 0.1 | 0.5 |
| Translation | (0.2) | (2.8) | 0.8 | (0.8) |
| Total sales change | 0.9% | (1.4)% | (1.6)% | (0.2)% |

Additional information beyond what is included in the preceding tables are as follows:

- For the third quarter of 2024, in the Americas geographic area, U.S. total sales increased 1 percent which included flat organic sales. In the Asia Pacific geographic area, China total sales increased 8 percent which included increased organic sales of 7 percent.
- For the first nine months of 2024, in the Americas geographic area, U.S. total sales increased 1 percent which included flat organic sales. In the Asia Pacific geographic area, China total sales increased 8 percent which included increased organic sales of 9 percent.

***Financial condition:*** Refer to the section entitled *Financial Condition and Liquidity* later in MD&A for a discussion of items impacting cash flows.

In November 2018, 3M’s Board of Directors replaced the Company’s February 2016 repurchase program with a new repurchase program. This new program authorizes the repurchase of up to $10 billion of 3M’s outstanding common stock, with no pre-established end date. In the first nine months of 2024, the Company purchased $1,096 million of its own stock, compared to $31 million of stock purchases in the first nine months of 2023. As of September 30, 2024, approximately $3.1 billion remained available under the authorization. In February 2024, 3M’s Board of Directors declared a first-quarter 2024 dividend of $1.51 per share. In May 2024, 3M's Board of Directors declared a second-quarter 2024 dividend of $0.70 per share resetting 3M's dividend post-Solventum spin. In August 2024, 3M's Board of Directors declared a third-quarter 2024 dividend of $0.70 per share.

### Results of Operations

***Net Sales:*** Refer to the preceding *Overview* section and the *Performance by Business Segment* section later in MD&A for additional discussion of sales change.

### Operating Expenses:

| (Percent of net sales) | Three months ended September 30, 2024 | 2023 | Change | Nine months ended September 30, 2024 | 2023 | Change |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| Cost of sales | **57.9%** | 59.3% | **(1.4)%** | **57.7%** | 60.1% | **(2.4)%** |
| Selling, general and administrative expenses (SG&A) | **16.9** | 86.4 | **(69.5)** | **17.9** | 97.8 | **(79.9)** |
| Research, development and related expenses (R&D) | **4.3** | 4.3 | **—** | **4.3** | 4.6 | **(0.3)** |
| Gain on business divestitures | **—** | (0.6) | **0.6** | **—** | (0.2) | **0.2** |
| Operating income (loss) margin | **20.9%** | (49.4)% | **70.3%** | **20.1%** | (62.3)% | **82.4%** |

***Cost of Sales:*** Cost of sales, measured as a percent of sales, decreased in the third quarter and first nine months of 2024 when compared to the same period last year. Decreases were primarily due to ongoing manufacturing productivity initiatives and lower raw materials and energy costs, along with lower year-on-year restructuring charges. See also *Certain Expenses Impacting Multiple Line Items within Results of Operations* subsection further below.

***Selling, General and Administrative Expenses:*** SG&A, measured as a percent of sales, decreased in the third quarter and first nine months of 2024 when compared to the same period last year. Decreases were primarily impacted by a $10.3 billion pre-tax charge related to the PWS settlement and the $4.2 billion pre-tax charge related to the CAE settlement in the second and third quarters of 2023 respectively (both discussed in Note 17). SG&A in 2024 was also impacted by lower year-on-year restructuring charges. See also *Certain Expenses Impacting Multiple Line Items within Results of Operations* subsection further below.

***Research, Development and Related Expenses:*** R&D, measured as a percent of sales, was consistent in the third quarter and decreased in the first nine months of 2024 when compared to the same period last year. 3M continues to invest in a range of R&D activities from application development, product and manufacturing support, product development and technology development aimed at disruptive innovations. See also *Certain Expenses Impacting Multiple Line Items within Results of Operations* subsection further below.

***Gain on Business Divestitures:*** In 2023, 3M recorded a pre-tax gain of $36 million related to the sale of assets associated with its dental local anesthetic business net of a previous contingent indemnification obligation from a 2020 divestiture.

***Other Expense (Income), Net:*** See Note 7 for a detailed breakout of this line item.

Interest expense (net of interest income) decreased in the third quarter compared to the same period last year due to the pay down of debt maturities and additional interest income from increased cash balances. Interest expense (net of interest income) increased in the first nine months of 2024 compared to the same period last year primarily driven by the addition of imputed interest associated with the obligations resulting from the PWS Settlement and the CAE Settlement in the second and third quarters of 2023 respectively (discussed in Note 17) partially offset by additional interest income.

The non-service pension and postretirement net benefit decreased approximately $33 million in the third quarter of 2024 and decreased approximately $869 million in the first nine months of 2024 compared to the same period last year, largely due to the $795 million second quarter 2024 pension settlement charge as a result of transferring a portion of U.S. pension payment obligations and related plan assets to an insurance company (see Note 13).

See also *Certain Expenses Impacting Multiple Line Items within Results of Operations* subsection further below.

Solventum ownership - change in value resulted in a year-on-year benefit of $0.6 billion and $1.7 billion for the third quarter and first nine months of 2024, respectively, following Solventum's separation from 3M in April 2024 (discussed in Note 2).

### Provision (benefit) for Income Taxes:

| (Percent of pre-tax income/loss) | Three months ended September 30, 2024 | 2023 | Nine months ended September 30, 2024 | 2023 |
| --- | ---: | ---: | ---: | ---: |
| Effective tax rate | **20.3%** | 23.5% | **19.0%** | 24.3% |

Factors that impacted the tax rates between years are further discussed in the *Overview* section above and in Note 9.

### Income from Unconsolidated Subsidiaries, Net of Taxes:

| (Millions) | Three months ended September 30, 2024 | 2023 | Nine months ended September 30, 2024 | 2023 |
| --- | ---: | ---: | ---: | ---: |
| Income (loss) from unconsolidated subsidiaries, net of taxes | **$3** | $2 | **$7** | $7 |

Income (loss) from unconsolidated subsidiaries, net of taxes, is attributable to the Company’s accounting under the equity method for ownership interests in certain entities.

### Net Income (Loss) Attributable to Noncontrolling Interest:

| (Millions) | Three months ended September 30, 2024 | 2023 | Nine months ended September 30, 2024 | 2023 |
| --- | ---: | ---: | ---: | ---: |
| Net income (loss) attributable to noncontrolling interest | **$4** | $4 | **$15** | $14 |

Net income (loss) attributable to noncontrolling interest represents the elimination of the income or loss attributable to non-3M ownership interests in 3M consolidated entities. The primary noncontrolling interest relates to 3M India Limited, of which 3M’s effective ownership is 75 percent.

### Certain Expenses Impacting Multiple Line Items within Results of Operations:

Stock compensation expense is discussed in Note 18 and impacts cost of sales, SG&A, and R&D. As note therein, higher stock-based compensation expense is recognized in the quarter in which 3M’s annual stock option and restricted stock unit grant is made because of accounting rules for grants to employees that are retiree-eligible. Typically, the annual grant is made in the first quarter. However, due to the spin-off of Solventum (see Note 2), the 2024 annual grant was made in May, after the April 1, 2024 separation.

Defined benefit pension and postretirement service cost expense for continuing operations (which impacts cost of sales, SG&A, and R&D) for the first nine months of 2024 was $148 million compared to $167 million in same period last year (as discussed in Note 13). The non-service cost component of pension and postretirement service cost impacts the other expense (income), net line item. For total year 2024, considering the remeasurements of U.S. pension and postretirement pension plans and second quarter 2024 $795 million pension settlement charge associated the pension risk transfer special item (all discussed in Note 13), 3M estimates full year 2024 continuing operations defined benefit pension and postretirement service cost expense to total approximately $195 million while continuing operations non-service pension and postretirement net benefit cost is anticipated to be a charge of approximately $825 million, for a total estimated continuing operations consolidated defined benefit pre-tax pension and postretirement expense of approximately $1,025 million. These amounts reflect a decrease of $27 million and an increase of $933 million in the service and non-service cost components, respectively.

For total year 2023 on a comparable continuing operations basis, the Company recognized defined benefit pension and postretirement service cost expense of $222 million and a benefit of $108 million related to all non-service pension and postretirement net benefit costs (after settlements, curtailments, special termination benefits and other) for a total continuing operations defined benefit pension and postretirement expense of $114 million.

For 2025, 3M preliminarily expects a year-on-year non-service pension and postretirement expense tailwind of approximately $720 million, primarily as a result of the second quarter 2024 pension risk transfer charge special item (see Note 13 and section entitled “Description of special items”). Adjusting for this 2024 special item, 3M expects a year-on-year headwind of approximately $70 million primarily due to amortization of prior service costs and impacts from previously deferred asset losses. These estimates are based on assumptions from 3M's most recent remeasurements of applicable plans carrying over to the year-end 2024 measurement.

The Company continues to make investments in the implementation of new business systems and solutions, including enterprise resource planning, with these investments impacting cost of sales, SG&A, and R&D.

***Significant Accounting Policies:*** Information regarding new accounting standards is included in Note 1 to the Consolidated Financial Statements.

### Performance by Business Segment

Item 1, Business Segments within 3M's 2023 Annual Report on Form 10-K, provides an overview of 3M’s business segments. In addition, disclosures relating to 3M’s business segments are provided in Note 19. As discussed in Note 19, 3M made changes to the composition of segment information reviewed by 3M's chief operating decision maker (CODM) effective in the second quarter of 2024 largely as a result of the separation of Solventum and changes within its business segments effective in the first quarter of 2024. Information provided herein reflects the impact of these changes for all applicable periods presented. 3M manages its continuing operations in three business segments. The reportable segments are Safety and Industrial; Transportation and Electronics; and Consumer.

Refer to 3M's 2023 Annual Report on Form 10-K, Item 1, Business, for discussion of 3M products that are included in each business segment.

### Safety and Industrial Business:

|  | Three months ended September 30, 2024 | 2023 | Nine months ended September 30, 2024 | 2023 |
| --- | ---: | ---: | ---: | ---: |
| Sales (millions) | **$2,767** | $2,751 | **$8,258** | $8,295 |
| Sales change analysis: |  |  |  |  |
| Organic sales | **0.9%** |  | **0.2%** |  |
| Translation | **(0.4)** |  | **(0.7)** |  |
| Total sales change | **0.5%** |  | **(0.5)%** |  |
| Business segment operating income (millions) | **$650** | $666 | **$1,919** | $1,801 |
| Percent change | **(2.4)%** |  | **6.5%** |  |
| Percent of sales | **23.5%** | 24.2 % | **23.2%** | 21.7 % |
| Adjusted business segment operating income (millions) (non-GAAP measure) | **$672** | $708 | **$1,959** | $1,884 |
| Percent change | **(5.1)%** |  | **4.0%** |  |
| Percent of sales | **24.3%** | 25.7 % | **23.7%** | 22.7 % |

The preceding table also displays business segment operating income (loss) information adjusted for special items. For Safety and Industrial these adjustments include net costs related to respirator mask/asbestos (Aearo-related and non-Aearo related). During the voluntary Aearo chapter 11 bankruptcy period (which began in July 2022 and ended in June 2023 —see Note 17), net costs related to Aearo-respirator mask/asbestos matters were reflected as corporate special items in Corporate and Unallocated while those associated with non-Aearo respirator mask/asbestos matters continued to be reflected as special items in the Safety and Industrial business segment. Prior to the bankruptcy, costs associated with Combat Arms Earplugs matters were reflected in the Safety and Industrial business segment (rather than reflected in Corporate and Unallocated—see Note 19 for additional information). Refer to the *Certain amounts adjusted for special items - (non-GAAP measures)* section for additional details.

#### Third quarter 2024 results:

Sales in Safety and Industrial were up 0.5 percent in U.S. dollars.

On an organic sales basis:

- Sales increased in roofing granules, industrial adhesives and tapes and electrical markets, were flat in industrial specialties and automotive aftermarket, and decreased in abrasives and personal safety.
- Growth primarily came from industrial adhesives and tapes driven by strength in bonding solutions for electronic devices and from growth in roofing granules and electrical markets.

Business segment operating income margins decreased year-on-year driven by cost inefficiencies due to the spin of Solventum, partially offset by benefits from organic growth and productivity. Adjusting for special item costs for significant litigation (non-GAAP measure), business segment operating income margins decreased year-on-year as displayed above.

#### First nine months 2024 results:

Sales in Safety and Industrial were down 0.5 percent in U.S. dollars.

On an organic sales basis:

- Sales increased in roofing granules and industrial adhesives and tapes, were flat in personal safety and electrical markets, and decreased in industrial specialties, abrasives and automotive aftermarket.
- Industrial end market demand remained mixed as end user and channel remain cautious. Growth primarily came from industrial adhesives and tapes driven by strength in bonding solutions for electronic devices and roofing granules driven by replacement demand for residential roofs.

Business segment operating income margins increased year-on-year primarily driven by benefits from productivity actions and strong spending discipline, partially offset by cost inefficiencies due to the spin of Solventum. Adjusting for special item costs for significant litigation (non-GAAP measure), business segment operating income margins increased year-on-year as displayed above.

### Transportation and Electronics Business:

|  | Three months ended September 30, 2024 | 2023 | Nine months ended September 30, 2024 | 2023 |
| --- | ---: | ---: | ---: | ---: |
| Sales (millions) | **$2,139** | $2,171 | **$6,386** | $6,412 |
| Sales change analysis: |  |  |  |  |
| Organic sales | **(1.2)%** |  | **—%** |  |
| Acquisitions | **—** |  | **0.8** |  |
| Translation | **(0.3)** |  | **(1.2)** |  |
| Total sales change | **(1.5)%** |  | **(0.4)%** |  |
| Business segment operating income (millions) | **$436** | $389 | **$1,345** | $1,093 |
| Percent change | **11.8%** |  | **23.0%** |  |
| Percent of sales | **20.4%** | 17.9% | **21.1%** | 17.0% |
| Adjusted sales (millions) (non-GAAP measure) | **$1,913** | $1,879 | **$5,643** | $5,443 |
| Sales change analysis: |  |  |  |  |
| Organic sales | **2.0%** |  | **3.9%** |  |
| Acquisitions | **—** |  | **0.9** |  |
| Translation | **(0.2)** |  | **(1.1)** |  |
| Total sales change | **1.8%** |  | **3.7%** |  |
| Adjusted business segment operating income (millions) (non-GAAP measure) | **$470** | $494 | **$1,375** | $1,147 |
| Percent change | **(5.2)%** |  | **19.8%** |  |
| Percent of sales | **24.5%** | 26.3% | **24.4%** | 21.1% |

The preceding table also displays business segment sales (and sales change) and operating income (loss) information adjusted for special items. For Transportation and Electronics these adjustments include the sales and estimates of income regarding PFAS manufactured products that 3M plans to exit by the end of 2025. Refer to the *Certain amounts adjusted for special items - (non-GAAP measures)* section for additional details.

#### Third quarter 2024 results:

Sales in Transportation and Electronics were down 1.5 percent in U.S. dollars. Adjusting for special item PFAS manufactured products (non-GAAP measure), sales were up 1.8 percent in U.S. dollars.

On an organic sales basis:

- Sales increased in electronics and commercial branding and transportation, and decreased in advanced materials and automotive and aerospace.
- Growth was held back by headwinds related to PFAS manufactured products.
- Growth primarily came from electronics as consumer electronics OEM customers ramped production volumes ahead of the upcoming holiday season. Automotive and aerospace was negatively impacted by decline in automotive OEM build rates partially offset by growth in aerospace driven by bonding and acoustic solutions.

Acquisitions:

- Impacts related to reconsolidation of Aearo entities are included in Transportation and Electronics.
- In the third quarter of 2022, 3M deconsolidated the Aearo Entities and, in the second quarter of 2023, reconsolidated those entities (discussed in Note 17). For each of the 12-months post-deconsolidation and post-reconsolidation, impacts are each reflected separately as divestiture and acquisition, respectively.

Business segment operating income margins increased year-on-year driven by benefits from organic growth and productivity, partially offset by cost inefficiencies due to the spin of Solventum. Adjusting for special item PFAS manufactured products (non-GAAP measure), business segment operating income margins decreased year-on-year as displayed above.

#### First nine months 2024 results:

Sales in Transportation and Electronics were down 0.4 percent in U.S. dollars. Adjusting for special item PFAS manufactured products (non-GAAP measure), sales were up 3.7 percent in U.S. dollars.

On an organic sales basis:

- Sales increased in electronics, were flat in commercial branding and transportation, and decreased in advanced materials, and in automotive and aerospace.
- Growth from strength in electronics due to additional spec-in wins and strength in semiconductor was offset by headwinds related to PFAS manufactured products.

Acquisitions/divestitures:

- Divestiture and acquisition impacts relate to lost/gained Transportation and Electronics sales year-on-year from the Aearo Entities. In the third quarter of 2022, 3M deconsolidated the Aearo Entities and, in the second quarter of 2023, reconsolidated those entities (discussed in Note 17). For each of the 12-months post-deconsolidation and post-reconsolidation, impacts are each reflected separately as divestiture and acquisition, respectively.

Business segment operating income margins increased year-on-year driven by benefits from strong leverage on organic growth, productivity actions, and strong spending discipline, partially offset by cost inefficiencies due to the spin of Solventum. Adjusting for special item PFAS manufactured products (non-GAAP measure), business segment operating income margins increased year-on-year as displayed above.

### Consumer Business:

|  | Three months ended September 30, 2024 | 2023 | Nine months ended September 30, 2024 | 2023 |
| --- | ---: | ---: | ---: | ---: |
| Sales (millions) | **$1,299** | $1,315 | **$3,702** | $3,800 |
| Sales change analysis: |  |  |  |  |
| Organic sales | **(0.7)%** |  | **(2.0)%** |  |
| Translation | **(0.5)** |  | **(0.6)** |  |
| Total sales change | **(1.2)%** |  | **(2.6)%** |  |
| Business segment operating income (millions) | **$263** | $269 | **$698** | $683 |
| Percent change | **(2.5)%** |  | **2.2%** |  |
| Percent of sales | **20.2%** | 20.5% | **18.9%** | 18.0% |

#### Third quarter 2024 results:

Sales in Consumer were down 1.2 percent in U.S. dollars.

On an organic sales basis:

- Sales increased in home improvement, and decreased in home and auto care, packaging and expression and consumer safety and well-being.
- Growth was led by home improvement driven by Command’s new product introductions for the back-to-school and holiday seasons. The remaining divisions within the Consumer business declined due to portfolio prioritization actions as well as retail customers continuing to be price sensitive and value focused.
- Growth was negatively impacted by continued softness in consumer discretionary spending for hard goods along with product portfolio and geographic prioritization.

Business segment operating income margins decreased year-on-year driven by organic growth declines and headwinds from cost inefficiencies due to the spin of Solventum.

#### First nine months 2024 results:

Sales in Consumer were down 2.6 percent in U.S. dollars.

On an organic sales basis:

- Sales increased in home improvement, and decreased in home and auto care, packaging and expression and consumer safety and well-being.
- Growth was negatively impacted by continued softness in consumer discretionary spending along with product portfolio and geographic prioritization.

Business segment operating income margins increased year-on-year from benefits from productivity actions, portfolio initiatives, and strong spending discipline, partially offset by decline in organic growth and cost inefficiencies due to the spin of Solventum.

***Corporate and Unallocated and Other:*** Outside of 3M's reportable operating segments, 3M has Corporate and Unallocated and Other which are not reportable business segments as they do not meet the segment reporting criteria. Because Corporate and Unallocated and Other include a variety of miscellaneous items, they are subject to fluctuation on a quarterly and annual basis. Corporate and Unallocated and Other are presented separately in the preceding business segments table and in Note 19.

- Corporate and Unallocated operating income (loss) includes “corporate special items” and “other corporate expense-net”.
- Corporate special items include net costs for significant litigation impacting operating income (loss) associated with PFAS-related other environmental and Combat Arms Earplugs matters. In addition, during the voluntary chapter 11 bankruptcy period (which began in July 2022 and ended in June 2023—see Note 17), costs associated with the Aearo portion of respirator mask/asbestos matters were also included in corporate special items. Prior to the bankruptcy, costs associated with Combat Arms Earplugs matters were not included in the Corporate net costs for significant litigation special item, instead being reflected in the Safety and Industrial business segment. Corporate special items for the periods presented also include divestiture costs and Russia exit costs/ benefits. Divestiture costs include costs that were not eligible to be part of discontinued operations related to separating and divesting substantially an entire business segment of 3M following public announcement of its intended divestiture.
- Refer to the *Certain amounts adjusted for special items - (non-GAAP measures)* section for additional details on the impact of special items for additional information on the components of corporate special items. Corporate special item net costs decreased year-over-year in the third quarter and first nine months of 2024 primarily due to lower net costs for significant litigation associated with Corporate and Unallocated.
- Other corporate expense-net includes certain enterprise and governance activities resulting in unallocated corporate costs and other activity and net costs that 3M may choose not to allocate directly to its business segments. Other corporate expense-net also includes costs previously allocated to Solventum prior to the Separation that were not eligible to be part of discontinued operations, commercial activity with Solventum post-Separation, and certain operations of the former Health Care business segment retained by 3M.
- Other corporate operating expenses, net, decreased year-over-year in the third quarter and first nine months of 2024 primarily due to the extent of non-discontinued operations-eligible former Solventum-allocated costs included in Corporate and Unallocated prior to Solventum's April 2024 Separation.
- Other:
- This category principally reflects activity associated with:
- Operations of businesses of the former Health Care segment divested prior to the Separation and therefore not reflected as discontinued operations within 3M's financial statements, along with limited-duration supply agreements with those previous divestitures.
- Transition arrangement agreements (e.g. fees charged by 3M, net of underlying costs) related to divested businesses, including those related to the Separation, as well as other applicable divestitures.
- Operating income categorized as "Other" were similar year-over-year in the third quarter of 2024 and decreased year-over-year in the first nine months of 2024 primarily due to the extent of transition arrangement income from divested businesses.

***Operating Business Segments:*** Information related to 3M’s business segments is presented in the tables that follow with additional context in the corresponding narrative below the tables.

### Financial Condition and Liquidity

The strength and stability of 3M’s business model and strong free cash flow capability, together with proven capital markets access, provide financial flexibility to deploy capital in accordance with the Company's stated priorities and meet needs associated with contractual commitments and other obligations. Investing in 3M’s business to drive organic growth and deliver strong returns on invested capital remains the first priority for capital deployment. This includes research and development, capital expenditures, and commercialization capability. The Company also continues to actively manage its portfolio through acquisitions and divestitures to maximize value for shareholders. 3M expects to continue returning cash to shareholders through dividends and share repurchases. To fund cash needs in the United States, the Company relies on ongoing cash flow from U.S. operations, access to capital markets and repatriation of the earnings of its foreign affiliates that are not considered to be permanently reinvested. For those international earnings considered to be reinvested indefinitely, the Company currently has no plans or intentions to repatriate these funds for U.S. operations. See Note 9 for further information on earnings considered to be reinvested indefinitely.

3M maintains a strong liquidity profile. The Company’s primary short-term liquidity needs are met through cash on hand and U.S. commercial paper issuances. 3M believes it will have continuous access to the commercial paper market. 3M’s commercial paper program permits the Company to have a maximum of $5 billion outstanding with a maximum maturity of 397 days from date of issuance. The Company had no commercial paper outstanding at September 30, 2024, compared to $1.8 billion commercial paper outstanding as of December 31, 2023.

***Total debt:*** The strength of 3M’s credit profile and significant ongoing cash flows provide 3M proven access to capital markets. Additionally, the Company’s debt maturity profile is staggered to help ensure refinancing needs in any given year are reasonable in proportion to the total portfolio. As of the date of this report, 3M has a credit rating of A3, stable outlook from Moody's Investors Service, a credit rating of BBB+, negative outlook from S&P Global Ratings, and a credit rating of A-, stable outlook from Fitch.

The Company’s total debt associated with continuing operations at September 30, 2024 decreased when compared to December 31, 2023 as a result of $2.9 billion in debt maturities, consisting of $1.1 billion of medium-term notes and $1.8 billion repayment of commercial paper borrowings. Amounts borrowed by Solventum during the first quarter of 2024 were a liability associated with discontinued operations and, as transferred obligations, became the sole responsibility of Solventum after the April 1, 2024 Separation, as discussed in Note 12. For discussion of repayments of and proceeds from debt refer to the following *Cash Flows from Financing Activities* section.

Effective February 8, 2023, the Company renewed its “well-known seasoned issuer” (WKSI) shelf registration statement, which registers an indeterminate amount of debt or equity securities for future issuance and sale. This replaced 3M’s previous WKSI shelf registration dated February 10, 2020. The Company has issued debt securities under a WKSI shelf in August 2019 and March 2020. 3M also has a medium-term notes program (Series F) program, originally established in 2016, up to an aggregate principal amount of $18 billion. As of September 30, 2024, the total amount of debt issued under the (Series F) program is approximately $17.6 billion (utilizing the foreign exchange rates applicable at the time of issuance for the euro denominated debt). The Company has not issued any debt under the (Series F) program since February 2019 and does not intend to issue any additional debt under this program in the future.

Information with respect to long-term debt issuances and maturities for the periods presented is included in Note 12.

In May 2023, 3M entered into a $4.25 billion five-year revolving credit facility expiring in 2028; the facility was amended in July and September 2023. The revolving credit agreement includes a provision under which 3M may request an increase of up to $1.0 billion (at lender’s discretion), bringing the total facility up to $5.25 billion. The agreement replaced the amended and restated $3.0 billion, five-year revolving credit agreement and the $1.25 billion 364-day credit facility that would have expired in November 2024 and November 2023, respectively. The credit facility was undrawn at September 30, 2024. Under the $4.25 billion credit facility, the Company is required to maintain its EBITDA to Interest Ratio as of the end of each fiscal quarter at not less than 3.0 to 1. This is calculated (based on amounts defined in the amended agreement) as the ratio of consolidated total EBITDA for the four consecutive quarters then ended to total interest expense on all funded debt for the same period. At September 30, 2024, 3M was in compliance with this requirement. Debt covenants do not restrict the payment of dividends.

The Company also had $343 million in stand-alone letters of credit and bank guarantees issued and outstanding at September 30, 2024. These instruments are utilized in connection with normal business activities.

***Cash, cash equivalents and marketable securities:*** At September 30, 2024, 3M had $7.3 billion of cash, cash equivalents and marketable securities, of which approximately $5.3 billion was held by the Company’s foreign subsidiaries and approximately $2.0 billion was held in the United States. These balances are invested in bank instruments and other high quality securities. At December 31, 2023, 3M had $5.8 billion of cash, cash equivalents and marketable securities, of which approximately $3.1 billion was held by the Company’s foreign subsidiaries and $2.7 billion was held by the United States. The increase from December 31, 2023 was driven by $8.4 billion in proceeds from debt (primarily related to Solventum's issuance of debt prior to the Separation as discussed in Note 12) partially offset by approximately $4.5 billion in payments associated with PFAS-related other environmental liabilities and the CAE legal settlement (both discussed in Note 17 - note also the "Material Cash Requirements from Known Contractual and Other Obligations" section further below) and debt maturities.

***Net Debt (non-GAAP measure):*** Net debt is not defined under U.S. GAAP and may not be computed the same as similarly titled measures used by other companies. The Company defines net debt as total debt less the total of cash, cash equivalents and current and long-term marketable securities all on a continuing operations basis. 3M believes net debt is meaningful to investors as 3M considers net debt and its components to be important indicators of liquidity and financial position. The table below provides net debt as of September 30, 2024 and December 31, 2023.

| (Millions) | September 30, 2024 | December 31, 2023 | Change |
| --- | ---: | ---: | ---: |
| Total debt | **$13,189** | $16,035 | **$(2,846)** |
| Less: Cash, cash equivalents and marketable securities | **7,315** | 5,805 | **1,510** |
| Net debt (non-GAAP measure) | **$5,874** | $10,230 | **$(4,356)** |

Refer to the preceding *Total Debt* and *Cash, Cash Equivalents and Marketable Securities* sections for additional details.

***Balance Sheet:*** 3M’s strong balance sheet and liquidity provide the Company with significant flexibility to fund its numerous opportunities going forward. The Company will continue to invest in its operations to drive growth, including continual review of acquisition opportunities.

The Company uses working capital measures that place emphasis and focus on certain working capital assets, such as accounts receivable and inventory activity.

#### Working capital (non-GAAP measure):

| (Millions) | September 30, 2024 | December 31, 2023 | Change |
| --- | ---: | ---: | ---: |
| Current assets | **$16,299** | $16,379 | **$(80)** |
| Less: Current liabilities | **11,391** | 15,297 | **(3,906)** |
| Working capital (non-GAAP measure) | **$4,908** | $1,082 | **$3,826** |

Various assets and liabilities, including cash and short-term debt, can fluctuate significantly from month to month depending on short-term liquidity needs. Working capital is not defined under U.S. generally accepted accounting principles and may not be computed the same as similarly titled measures used by other companies. The Company defines working capital as current assets minus current liabilities. 3M believes working capital is meaningful to investors as a measure of operational efficiency and short-term financial health.

Working capital increased $3.8 billion compared with December 31, 2023 primarily driven by lower balances of current liabilities principally of discontinued operations, short-term borrowings and current portions of long-term debt, and current liabilities relating to the PWS settlement (discussed in Note 17).

***Cash Flows:*** Discussions of cash flows from operating, investing and financing activities are provided in the sections that follow. The Consolidated Statements of Cash Flows include the results of continuing and discontinued operations and, therefore, also include cash and cash equivalents associated with Solventum through its April 2024 separation from 3M that were presented in current assets of discontinued operations in the 3M Consolidated Balance Sheet.

#### Cash Flows from Operating Activities:

Cash flows from operating activities can fluctuate significantly from period to period, as working capital movements, tax timing differences and other items such as litigation payments can significantly impact cash flows.

In the first nine months of 2024, cash flows provided by operating activities decreased $4.7 billion compared to the same period last year, primarily driven by approximately $4.5 billion in payments associated with PFAS-related other environmental liabilities and the CAE legal settlement (both discussed in Note 17). The 2023 pre-tax charges of $10.3 billion related to the PWS Settlement and of $4.2 billion related to the CAE settlement largely impacted the net income component within the Consolidated Statements of Cash Flows, with offsets in the other-net and deferred tax elements.

#### Cash Flows from Investing Activities:

Investments in property, plant and equipment (PP&E) enable growth across many diverse markets, helping to meet product demand and increasing manufacturing efficiency. 3M invested $890 million on PP&E in the first nine months of 2024.

3M invests in renewal and maintenance programs, which pertain to cost reduction, cycle time, maintaining and renewing current capacity, eliminating pollution, and compliance. Costs related to maintenance, ordinary repairs, and certain other items are expensed. 3M also invests in growth, which adds to capacity, driven by new products, both through expansion of current facilities and new facilities. Finally, 3M also invests in other initiatives, such as information technology (IT), laboratory facilities, and a continued focus on investments in sustainability.

Purchases of marketable securities and investments and proceeds from maturities and sale of marketable securities and investments are primarily attributable to certificates of deposit/time deposits, commercial paper, and other securities, which are classified as available-for-sale. Refer to Note 11 for more details about 3M’s diversified marketable securities portfolio. Purchases of investments include additional survivor benefit insurance, plus investments in equity securities.

#### Cash Flows from Financing Activities:

Debt cash flow activity includes proceeds from Solventum's issuance of $8.4 billion in aggregate principal amount of debt in the first quarter of 2024 partially offset by $2.9 billion in debt maturities, consisting of $1.1 billion of medium-term notes and $1.8 billion repayment of commercial paper borrowings. Gross commercial paper issuances and repayments, in addition to repayments of the fixed-rate notes are largely reflected in “Proceeds from debt (maturities greater than 90 days)” and "Repayment of debt (maturities greater than 90 days)". The Company had no commercial paper outstanding at September 30, 2024, compared to $1.8 billion commercial paper outstanding as of December 31, 2023. 3M’s primary short-term liquidity needs are met through cash on hand and U.S. commercial paper issuances. Refer to Note 12 for more detail regarding debt.

Repurchases of common stock are made to support the Company’s stock-based employee compensation plans and for other corporate purposes. In the first nine months of 2024, the Company purchased $1,096 million of its own stock. For more information, refer to the table titled “Issuer Purchases of Equity Securities” in Part II, Item 2. The Company does not utilize derivative instruments linked to the Company’s stock.

3M has paid dividends since 1916. In February 2024, 3M’s Board of Directors declared a first-quarter 2024 dividend of $1.51 per share. In May 2024, 3M's Board of Directors declared a second-quarter 2024 dividend of $0.70 per share resetting 3M's dividend post-Solventum spin. In August 2024, 3M's Board of Directors declared a third-quarter 2024 dividend of $0.70 per share.

Cash flows from financing activity in 2024 also include $0.6 billion of net cash transferred to Solventum associated with the close of the Separation (discussed in Note 2).

Other cash flows from financing activities may include various other items, such as cash paid associated with certain derivative instruments, distributions to or sales of noncontrolling interests, changes in overdraft balances, and principal payments for finance leases.

***Material Cash Requirements from Known Contractual and Other Obligations:*** See the Financial Condition and Liquidity - Material Cash Requirements from Known Contractual and Other Obligations section of Item 7 of 3M's 2023 Annual Report on Form 10-K.

### Cautionary Note Concerning Factors That May Affect Future Results

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part I, Item 2, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Company may also make forward-looking statements in other reports filed with the United States Securities and Exchange Commission ("SEC"), in materials delivered to shareholders and in press releases. In addition, the Company’s representatives may from time to time make oral forward-looking statements.

Forward-looking statements relate to future events and typically address the Company’s expected future business and financial performance. Words such as “plan,” “expect,” “aim,” “believe,” “project,” “target,” “anticipate,” “intend,” “estimate,” “will,” “should,” “could,” "would," “forecast” and other words and terms of similar meaning, typically identify such forward-looking statements. In particular, these include, among others, statements relating to:

- worldwide economic, political, regulatory, international trade, geopolitical, capital markets and other external conditions and other factors beyond the Company's control, including inflation, recession, military conflicts, and natural and other disasters or climate change affecting the operations of the Company or its customers and suppliers,
- foreign currency exchange rates and fluctuations in those rates,
- liabilities and the outcome of contingencies related to certain fluorochemicals known as "PFAS," including liabilities related to claims, lawsuits, and government regulatory proceedings concerning various PFAS-related products and chemistries, as well as risks related to the Company's plans to exit PFAS manufacturing and discontinue use of PFAS across its product portfolio,
- risks related to the class-action settlement (“PWS Settlement”) to resolve claims by public water suppliers in the United States regarding PFAS,
- legal proceedings, including significant developments that could occur in the legal and regulatory proceedings described in the Company's reports on Form 10-K, 10-Q, and 8-K,
- competitive conditions and customer preferences,
- the timing and market acceptance of new product and service offerings,
- the availability and cost of purchased components, compounds, raw materials and energy due to shortages, increased demand and wages, supply chain interruptions, or natural or other disasters,
- unanticipated problems or delays with the phased implementation of a global enterprise resource planning (ERP) system, or security breaches and other disruptions to the Company's information or operational technology infrastructure,
- the impact of acquisitions, strategic alliances, divestitures, and other strategic events resulting from portfolio management actions and other evolving business strategies,
- operational execution, including the extent to which the Company can realize the benefits of planned productivity improvements, as well as the impact of organizational restructuring activities,
- financial market risks that may affect the Company's funding obligations under defined benefit pension and postretirement plans,
- the Company’s credit ratings and its cost of capital,
- tax-related external conditions, including changes in tax rates, laws, or regulations,
- matters relating to the spin-off of the Company's Health Care business, including the risk that the expected benefits will not be realized; the risk that the costs or dis-synergies will exceed the anticipated amounts; potential business disruption; the diversion of management time; the impact of the transaction on the Company's ability to retain talent; potential impacts on the Company's relationships with its customers, suppliers, employees, regulators and other counterparties; the ability to realize the desired tax treatment; the risk that any consents or approvals required will not be obtained; risks under the agreements and obligations entered into in connection with the spin-off, and
- matters relating to Combat Arms Earplugs (“CAE”), including those related to the August 2023 settlement that is intended to resolve, to the fullest extent possible, all litigation and alleged claims involving the CAE sold or manufactured by the Company's subsidiary Aearo Technologies and certain of its affiliates (“Aearo Entities”) and/or 3M (“CAE Settlement”).

The Company assumes no obligation to update or revise any forward-looking statements. Changes in such assumptions or factors could produce significantly different results.

Forward-looking statements are based on certain assumptions and expectations of future events and trends that are subject to risks and uncertainties. Actual future results and trends may differ materially from historical results or those reflected in any such forward-looking statements depending on a variety of factors. Important information as to these factors can be found in this document, including, among others, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the headings of “Overview,” “Financial Condition and Liquidity” and annually in “Critical Accounting Estimates.” Discussion of these factors is incorporated by reference from Part II, Item 1A, “Risk Factors,” of this document, and should be considered an integral part of Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” For additional information concerning factors that may cause actual results to vary materially from those stated in the forward-looking statements, see our reports on Form 10-K, 10-Q and 8-K filed with the SEC from time to time.

## Market risk

As filed, 655 characters.

In the context of Item 3, 3M is exposed to market risk due to the risk of loss arising from adverse changes in foreign currency exchange rates, interest rates and commodity prices. Changes in those factors could impact the Company’s results of operations and financial condition. For a discussion of sensitivity analysis related to these types of market risks, refer to Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk, in 3M's 2023 Annual Report on Form 10-K. There have been no material changes in information that would have been provided in the context of Item 3 from the end of the preceding year until September 30, 2024.

## Controls and procedures

As filed, 2,526 characters.

a. The Company carried out an evaluation, under the supervision and with the participation of its management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s “disclosure controls and procedures” (as defined in the Exchange Act Rule 13a-15(e)) as of the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective.

b. There was no change in the Company’s internal control over financial reporting that occurred during the Company’s most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

The Company continues to implement new business systems and solutions, including an enterprise resource planning system (ERP), which are expected to improve the efficiency of certain financial and related business processes. These implementations are expected to occur on an on-going basis as opportunities and needs are identified and addressed. The implementations, in certain cases, may affect the processes that constitute the Company’s internal control over financial reporting and will require testing for effectiveness.

The Company completed implementation with respect to various processes/sub-processes in certain subsidiaries/locations, including aspects relative to the United States, and will continue the implementations over the next several years. As with any new information technology application the Company implements, these applications, along with the internal control over financial reporting included in these processes, were appropriately considered within the testing for effectiveness with respect to the implementation in these instances. The Company concluded, as part of its evaluation described in the above paragraphs, that the implementation in these circumstances has not materially affected its internal control over financial reporting.

In connection with the Separation, there were several processes, policies, operations, technologies and information systems that were transferred or separated. Through the quarter ended September 30, 2024, the Company continued to take steps to ensure that adequate controls were designed and maintained throughout this transition period.

### 3M COMPANY

### FORM 10-Q

### For the Quarterly Period Ended September 30, 2024

## Risk factors

As filed, 43,774 characters.

Provided below is a cautionary discussion of what we believe to be the most important risk factors applicable to the Company. Discussion of these factors is incorporated by reference into and considered an integral part of Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

### Risks Related to the Global Economy and External Conditions

*\* The Company’s results are impacted by the effects of, and changes in, worldwide economic, political, regulatory, international trade, geopolitical, and other external conditions.*

During the third quarter of 2024, the Company derived approximately 55 percent of its revenues from outside the United States. Accordingly, the Company’s operations and the execution of its business strategies and plans are subject to global competition and economic and geopolitical risks that are beyond its control, such as, among other things, disruptions in financial markets, economic downturns, military conflicts, terrorism, public health emergencies, political changes and trends such as protectionism, economic nationalism resulting in government actions impacting international trade agreements or imposing trade restrictions such as tariffs and retaliatory counter measures, and government deficit reduction and other austerity measures in locations or industries in which the Company operates. Further escalation of specific trade tensions, including those between the U.S. and China, or more broadly in global trade conflict, could adversely impact the Company's business and operations around the world. The Company's business is also impacted by social, political, and labor conditions in locations in which the Company or its suppliers or customers operate; adverse changes in the availability and cost of capital; monetary policy; interest rates; inflation; recession; commodity prices; currency volatility or exchange control; ability to expatriate earnings; and other laws and regulations in the jurisdictions in which the Company or its suppliers or customers operate. For example, changes in local economic condition or outlooks, such as lower economic growth rates in China, Europe, or other key markets, impact the demand or profitability of the Company's products.

The global economy has been impacted by military conflicts, including the conflict between Russia and Ukraine. The U.S. and other governments have imposed export controls on certain products and financial and economic sanctions on certain industry sectors and parties in Russia. 3M suspended operations of its subsidiaries in Russia in March 2022 and completed a sale of the related assets in June 2023. These geopolitical tensions could result in, among other things, cyberattacks, supply chain disruptions, higher energy and other commodity costs, lower consumer demand, and changes to foreign exchange rates and financial markets, any of which may adversely affect the Company's business and supply chain.

Climate change and severe weather events, including related environmental and social regulations, as well as natural disasters, may negatively impact the Company or its customers and suppliers, in terms of availability and cost of natural resources, sources and supply of energy, product demand and manufacturing, compliance costs, and the health and well-being of individuals and communities in which we or our suppliers or customers operate.

*\* Foreign currency exchange rates and fluctuations in those rates may affect the Company’s ability to realize projected growth rates in its sales and earnings.*

The Company’s financial statements are denominated in U.S. dollars and, as noted above, the Company derives a significant percentage of its revenues from outside the United States. As a result, the Company’s results of operations and its ability to realize projected growth rates in sales and earnings could be adversely affected if the U.S. dollar strengthens significantly against foreign currencies, and the Company's results of operations may experience volatility related to changes in exchange rates. For a discussion of the impact of foreign currency exchange rates on the Company, see Part I, Item 2, "Management's Discussion and Analysis of Financial Condition and Results of Operations."

### Risks Related to Legal and Regulatory Proceedings

*\* The Company faces liabilities related to certain fluorochemicals, which could adversely impact our results.*

As previously reported, governments in the United States and internationally have increasingly been regulating a broad group of perfluoroalkyl and polyfluoroalkyl substances produced by the Company, collectively known as “PFAS,” including some presently or historically produced by the Company.

The PFAS group of substances contains several categories and classes of durable chemicals and materials with properties that include oil, water, temperature, chemical, and fire resistance, as well as electrical insulating properties. The strength of the carbon-fluorine bond also means that these compounds do not easily degrade. These characteristics have made PFAS substances critical to the manufacture of a wide range of products, including electronic devices such as cell phones, tablets, and semi-conductors. They are also used to help prevent contamination of medical products like surgical gowns and drapes. Commercial aircraft and low-emissions vehicles also rely on PFAS technology. 3M is just one of a number of companies that manufacture PFAS compounds.

As science and technology evolve and advance, and in response to evolving knowledge and the understanding that certain PFAS compounds had the potential to build up over time, 3M announced in 2000 that it would voluntarily phase out production of two PFAS substances, perfluorooctanoate (PFOA) and perfluorooctane sulfonate (PFOS) globally as a precautionary measure. Most of the phase out activities in the United States were completed by the end of 2002. The phase out included materials used to produce certain repellents and surfactant products, and products including Aqueous Film Forming Foam (AFFF) and certain coatings for food packaging, for example. Following the phase out of PFOA and PFOS production, the Company has continued to review, control, or eliminate the presence of certain PFAS in purchased materials, as intended substances in products, or as byproducts of some of 3M’s current manufacturing processes, products, and waste streams.

3M announced in December 2022 it will take two actions with respect to PFAS (2022 PFAS Announcement): exiting all PFAS manufacturing by the end of 2025, and working to discontinue the use of PFAS across its product portfolio by the end of 2025. 3M continues to make progress toward these goals, as discussed further below. The Company recognized a $0.8 billion pre-tax charge in the fourth quarter of 2022 associated with the 2022 PFAS Announcement related to asset impairments, and will incur additional expenses in connection with the 2022 PFAS Announcement. In addition, the 2022 PFAS Announcement involves risks, including: the actual timing, costs, and financial impact of such exit; the Company’s ability to complete such exit on the anticipated timing or at all; potential governmental or regulatory actions relating to PFAS or the Company’s exit plans; the Company’s ability to identify and manufacture, or procure from third parties if possible, acceptable substitutes for PFAS-containing materials in 3M's supply chain; the possibility that such non-PFAS options are not available or that such substitutes may not achieve the anticipated or desired commercial, financial or operational results; potential litigation relating to the Company’s exit plans or to any products that include third-party manufactured materials containing PFAS that are incorporated into the products the Company sells; and the possibility that the planned exit will involve greater costs than anticipated, may not be feasible, may not be feasible on the timeframe initially predicted, or may otherwise have negative impacts on the Company’s relationships with its customers and other parties.

As stated above, 3M is progressing toward the exit of all PFAS manufacturing by the end of 2025. 3M is also working to discontinue the use of PFAS across its product portfolio by the end of 2025 and has made progress in eliminating the use of PFAS across its product portfolio in a variety of applications. With respect to PFAS-containing products not manufactured by 3M in the Company's supply chains, the Company continues to evaluate the availability and feasibility of third-party products that do not contain PFAS. Depending on the availability and feasibility of such third-party products not containing PFAS, the Company continues to evaluate circumstances in which the use of PFAS-containing products manufactured by third parties and used in certain applications in 3M’s product portfolios, such as lithium ion batteries, printed circuit boards and certain seals and gaskets, all widely used in commerce across a variety of industries, and in some cases required by regulatory or industry standards, may or are expected to, depending on applications, continue beyond 2025. In other cases, regulatory approval, customer re-certification or re-qualification of substitutes or replacements to eliminate the use of PFAS manufactured by third parties may not be completed, or, depending on circumstances, are not expected to be completed, by the end of 2025. With respect to PFAS-containing products manufactured by third parties, the Company intends to continue to evaluate beyond the end of 2025 the adoption of third-party products that do not contain PFAS to the extent such products are available and such adoption is feasible.

3M has noticed several global regulatory trends related to PFAS, including decreasing emission standards and limits set for the presence of certain PFAS in various media, and the inclusion in regulatory activity of a broadening group of PFAS. Developments in these and other global regulatory trends may require additional actions by 3M, including investigation, remediation and compliance actions, and may result in additional litigation and enforcement action-related costs.

Under certain environmental laws, including the United States Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”) and similar state laws, the Company may be jointly and severally liable, sometimes with other potentially responsible parties, for the costs of investigation and remediation of environmental contamination at current or former facilities and at off-site locations where substances designated as “hazardous substances” have been released or disposed of. The Company has identified numerous locations, many of which are in the United States, at which it may have some liability for remediation of contamination under applicable environmental laws. As a result of the CERCLA designation of PFOA and PFOS as hazardous substances in 2024, and to the extent EPA finalizes additional proposals related to PFAS, 3M may be required to undertake additional investigative or remediation activities, including where 3M conducts operations or where 3M has disposed of waste. 3M may also face additional litigation from other entities that have liability under these laws for claims seeking contribution for clean-up costs other entities might have.

The Company has been voluntarily cooperating with various local, state, federal (primarily the U.S. Environmental Protection Agency (EPA)), and international agencies in their reviews of the environmental and health effects of certain PFAS produced by the Company. 3M currently is defending lawsuits concerning various PFAS-related products and chemistries, and is subject to unasserted and asserted claims and governmental regulatory proceedings and inquiries related to the production and use of PFAS in a variety of jurisdictions, as discussed in Note 17, “Commitments and Contingencies,” within the Notes to Consolidated Financial Statements. 3M has seen increased public and private lawsuits being filed on behalf of states, counties, cities, and utilities alleging, among other things, harm to the general public and damages to natural resources, some of which are pending in the AFFF multi-district litigation and some of which are pending in other jurisdictions. Various factors or developments in these and other disclosed actions could result in future charges that could have a material adverse effect on 3M. For example, the Company recorded a pre-tax charge of $897 million, inclusive of legal fees and other related obligations, in the first quarter of 2018 with respect to the settlement of a matter brought by the State of Minnesota involving the presence of PFAS in the groundwater, surface water, fish or other aquatic life, and sediments in the state. In addition, as described in greater detail in Note 17, “Commitments and Contingencies,” within the Notes to Consolidated Financial Statements, in June 2023, the Company entered into a class-action settlement (“PWS Settlement”) to resolve a wide range of drinking water claims by public water suppliers in the United States regarding PFAS. The court approved that settlement in March 2024. 3M will pay $10.5 billion to $12.5 billion in total to resolve the claims released by the PWS Settlement, with payments to be made from 2024 through 2036, in exchange for a release of certain claims, as described further in Note 17. Unexpected events related to the PWS Settlement, including the potential impact of the PWS Settlement on other PFAS-related matters could have a material adverse effect on the Company’s results of operations, cash flows or its consolidated financial position. In addition, as previously disclosed, in connection with the separation of Solventum, the Company agreed to retain liabilities related to PFAS for certain products sold by Solventum for a limited period of time following the separation.

Governmental inquiries, lawsuits, or laws and regulations involving PFAS could lead to our incurring liability for damages or other costs, civil or criminal proceedings, the imposition of fines and penalties, or other remedies, including orders to conduct remediation, as well as restrictions on or added costs for our business operations going forward, including in the form of restrictions on discharges at our manufacturing facilities, requiring the installation of control technologies, suspension or shutdown of facility operations, switching costs in seeking alternative sources of supply, potential customer damage claims due to supply disruptions or otherwise, restoration of and/or compensation for damages to natural resources, and for personal injury and property damages, and reporting requirements or bans on PFAS and PFAS-containing products manufactured by the Company. Any of the foregoing could have a material adverse effect on the Company’s results of operations, cash flows or its consolidated financial position.

*\* The Company is subject to risks related to international, federal, state, and local treaties, laws, and regulations, as well as compliance risks related to legal or regulatory requirements, contract requirements, policies and practices, or other matters that require or encourage the Company or its suppliers, vendors, or channel partners to conduct business in a certain way. The outcome of legal and regulatory proceedings related to compliance with these treaties, laws, regulations, and requirements could have a material adverse effect on the Company's reputation, ability to execute its strategy and its results of operations.*

The Company operates globally, including in some jurisdictions that pose potentially elevated risks of fraud or corruption or increased risk of internal control issues, and is subject to risks related to international, federal, state, and local treaties, laws, and regulations, including those involving product liability; securities and corporate laws; antitrust and competition laws; intellectual property; environmental, health, and safety; tax; the U.S. Foreign Corrupt Practices Act (FCPA) and other anti-bribery and anti-corruption laws; international import and export requirements and trade sanctions compliance; laws and regulations that apply to industries served by the Company, including the False Claims Act, anti-kickback laws, and the Sunshine Act; and other matters. The Company is also subject to compliance risks related to legal or regulatory requirements, contract requirements, policies and practices, or other matters that require or encourage the Company and its suppliers, vendors, or channel parties, to conduct business in a certain way. Legal compliance risks also include third-party risks where the Company’s suppliers, vendors, or channel partners, or trade associations to which the Company belongs, have business practices that are inconsistent with 3M’s Supplier Responsibility Code, 3M performance requirements, or with legal requirements.

The Company or its third-party vendors may develop or incorporate artificial intelligence technology in certain business processes, services or products. The development and use of artificial intelligence may present risks to the Company’s business. Also, the rapidly evolving legal and regulatory environment relating to artificial intelligence, in the United States and internationally, could impact the Company’s implementation of artificial intelligence technology, and increase compliance costs and the risk of non-compliance. While the Company will seek to develop and use artificial intelligence responsibly, and will attempt to identify and mitigate ethical, privacy, legal or other issues presented by its use, there can be no assurance that the Company will be fully successful in doing so, and may be subject to data breaches, allegations of unauthorized access to, or use of, third party data, information, or intellectual property rights, or other risks, which may lead to financial losses, legal liability, regulatory scrutiny and reputational damage.

The failure to comply with the FCPA and other anti-bribery and anti-corruption laws and regulations could result in significant civil fines and penalties or criminal sanctions against the Company, which could have a material adverse effect on our business, reputation, operating results and financial condition. These laws and regulations prohibit corrupt payments by the Company's employees, suppliers, vendors, channel partners or agents. The Company is also required to maintain accurate books and records and adequate internal controls under the FCPA's accounting provisions. From time to time, the Company receives reports internally and externally, via various reporting channels deployed by its Ethics and Compliance function or otherwise (such as shareholder communications), about business and other activities that raise compliance or other legal or litigation issues. The Company has in the past, and in the future could be, required to investigate such reports and cooperate with U.S. and foreign regulatory authorities in such investigations, audit, monitor compliance or alter its practices as part of such investigations, and the Company has in the past and may in the future be required to pay fines or penalties related to its practices. While the Company maintains and implements U.S. and international compliance programs, including policies and procedures, training, and internal controls designed to reduce the risk of noncompliance, the Company's employees, suppliers, vendors, channel partners or agents may violate such policies and procedures and engage in practices that contravene relevant laws and regulations.

The Company's results of operations could be adversely impacted if the costs to comply with these evolving treaties, laws, regulations, and requirements are greater than projected by the Company. In addition, the outcome of legal and regulatory proceedings related to compliance with these treaties, laws, regulations, and requirements are difficult to reliably predict, may differ from the Company’s expectations, and have resulted and may in the future result in, one or more of the following: criminal or civil sanctions, including fines; limitations on the extent to which the Company can conduct business; employee and business partner terminations due to policy violations; and private rights of action that result in litigation exposure, including expenses and costs incurred in connection with settlement or court proceedings, for the Company. In addition, detecting, investigating and resolving actual or alleged violations of these acts is expensive and could consume significant time and attention of our senior management. Although the Company maintains general liability insurance to mitigate monetary exposure, the amount of liability that may result from certain of these risks may not always be covered by, or could exceed, the applicable insurance coverage. Various factors or developments can lead the Company to change current estimates of liabilities and related insurance receivables where applicable, or make such estimates for matters previously not susceptible of reasonable estimates, such as a significant judicial ruling or judgment, a significant settlement, significant regulatory developments or changes in applicable law. A future adverse ruling, settlement, or unfavorable development could result in future charges that could have a material adverse effect on the Company’s results of operations or cash flows or its consolidated financial position. In addition, negative publicity related to the matters noted above or other matters involving the Company may negatively impact the Company’s reputation. The Company also relies on patent and other intellectual property protection, and challenges to the Company’s intellectual property rights, or claims that the Company’s activities interfere with the intellectual property rights of a third party, could cause the Company to incur significant expenses to assert or defend against such claims, could result in reduced revenue, and could damage the Company’s reputation, any of which could have an adverse effect on the Company. For a more detailed discussion of the legal proceedings involving the Company and the associated accounting estimates, see the discussion in Note 17, “Commitments and Contingencies,” within the Notes to Consolidated Financial Statements.

### Risks Related to Our Products and Customer Preferences

*\* The Company’s results are affected by competitive conditions and customer preferences.*

Demand for the Company’s products, which impacts revenue and profit margins, is affected by, among other things, (i) the development and timing of the introduction of competitive products; (ii) the Company’s pricing strategies; (iii) changes in customer order patterns, such as changes in the levels of inventory maintained by customers, vendors, or channel partners; (iv) changes in customers’ preferences for our products, including preferences for products that do not contain PFAS, the success of products offered by our competitors, and changes in customer designs for their products that can affect the demand for some of the Company’s products; and (v) changes in the business environment related to disruptive technologies, such as artificial intelligence and machine learning technologies, block-chain, expanded analytics, and other enhanced learnings from increasing volume of available data.

*\* The Company’s growth objectives are largely dependent on the timing and market acceptance of its new product offerings, including its ability to continually renew its pipeline of new products and to bring those products to market.*

This ability is subject to difficulties or delays in product development, such as the inability to identify viable new products, obtain adequate intellectual property protection, or gain market acceptance of new products. There are no guarantees that new products will prove to be commercially successful.

*\* The Company’s future results are subject to vulnerability with respect to materials and fluctuations in the costs and availability of purchased components, compounds, raw materials, energy, and labor due to shortages, increased demand and wages, logistics, supply chain interruptions, manufacturing site disruptions, regulatory developments, natural disasters, and other disruptive factors.*

The Company depends on various components, compounds, raw materials, and energy (including oil and natural gas and their derivatives) supplied by others for the manufacturing of its products. Supplier relationships have been and could be interrupted in the future due to supplier material shortage, climate impacts and severe weather events, natural and other disasters, and other disruptive events such as military conflicts, or be terminated. In addition, some of our suppliers are limited- or sole-source suppliers, and our ability to meet our obligations to customers depends on the performance, product quality, and stability of such suppliers and the Company's ability to source adequate alternatives in a cost-effective manner. Any sustained interruption in the Company’s receipt of adequate supplies, supply chain disruptions impacting the distribution of products, or disruption to key manufacturing sites’ operations due to natural and other disasters or events, such as government actions relating to discharge or emission permits or other legal or regulatory requirements, could have a material adverse effect on the Company and its ability to fulfill supply obligations to its customers. The Company could incur contractual penalties, experience a deterioration in customer relationships, or suffer harm to its reputation if the Company is unable to fulfill its obligations to customers, any of which could have a material adverse effect on the Company. In addition, there can be no assurance that the Company's processes to minimize volatility in component and material pricing will be successful or that future price fluctuations or shortages will not have a material adverse effect on the Company.

### Risks Related to Our Business

*\* The Company employs information including operational technology systems to support its business and to collect, store, and/or use proprietary and confidential information, including ongoing phased implementation of an enterprise resource planning (ERP) system as part of its business transformation on a worldwide basis over the next several years. Network disruptions, security and data breaches, cyberattacks, and other cybersecurity incidents involving the Company’s information technology systems, networks and infrastructure could disrupt or interfere with the Company’s operations; result in the compromise and misappropriation of proprietary and confidential information belonging to the Company or its customers, suppliers, and employees; and expose the Company to numerous expenses, liabilities, and other negative consequences, any or all of which could adversely impact the Company’s business, reputation, and results of operations.*

In the ordinary course of business, the Company relies on centralized and local information technology networks and systems, some of which are provided, hosted, or managed by vendors and other third parties, to process, transmit, and store electronic information, and to manage or support a variety of businesses. Additionally, the Company collects and stores certain data, including proprietary business information, and has access to confidential or personal information in certain of our businesses that is subject to artificial intelligence, privacy and cybersecurity laws, regulations, and customer-imposed controls. Third parties and threat actors, including organized criminals, nation-state entities, and/or nation-state supported actors, regularly attempt to gain unauthorized access to the Company’s information and operational technology networks and infrastructure, data, and other information, and many such attempts are becoming increasingly sophisticated. Despite our cybersecurity and business continuity counter measures (including employee and third-party training, monitoring of networks and systems, patching, maintenance, and backup of systems and data), the Company’s information and operational technology systems, networks and infrastructure have experienced and are expected to experience cyberattacks of various degrees of sophistication, and are susceptible to insider threat, compromise, damage, disruption, or shutdown, including as a result of the exploitation of known or unknown hardware or software vulnerabilities, or zero day attacks, in our systems or the systems of our vendors and third-party service providers, the introduction of computer viruses, malware or ransomware, service or cloud provider disruptions or security breaches, phishing attempts, employee error or malfeasance, power outages, telecommunication or utility failures, systems failures, natural disasters, or other catastrophic events. The Company’s increased adoption of remote working, initially driven by the COVID-19 health pandemic, also introduces additional threats and risk of disruptions to our information technology systems, networks and infrastructure. Despite our cybersecurity counter measures, it is possible for security vulnerabilities or a cyberattack to remain undetected for an extended time, up to and including several months, and the prioritization of decisions with respect to security measures and remediation of known vulnerabilities that we and the vendors and other third parties upon which we rely make may prove inadequate to protect against these attacks. While we and third parties we utilize have experienced, and expect to continue to experience, cybersecurity incidents that could lead to other disruptions of the Company’s and the third parties' information and operational technology systems and infrastructure, we do not believe that any such cybersecurity incidents to date have had a material impact on the Company. Any cybersecurity incident or information or operational technology network disruption could result in numerous negative consequences, including the risk of legal claims or proceedings, investigations or enforcement actions by U.S., state, or foreign regulators; liabilities or penalties under applicable laws and regulations, including privacy laws and regulations in the U.S. and other jurisdictions; interference with the Company’s operations; the incurrence of remediation costs; loss of intellectual property protection; the loss of customer, supplier, or employee relationships; and damage to the Company’s reputation, any of which could adversely affect the Company’s business. Although the Company maintains insurance coverage for various cybersecurity and business continuity risks, there can be no guarantee that all costs, damages, expenses or losses incurred will be fully insured.

*\* Acquisitions, strategic alliances, divestitures, and other strategic events resulting from portfolio management actions and other evolving business strategies could affect future results.*

The Company monitors its business portfolio and organizational structure and has made and may continue to make acquisitions, strategic alliances, divestitures, and changes to its organizational structure. With respect to acquisitions and strategic alliances, future results will be affected by, as applicable, the Company’s ability to integrate acquired businesses quickly and obtain the anticipated synergies and the Company's ability to operationalize and derive anticipated benefits from alliances. Divestitures may include continued involvement in the divested businesses, such as through transitional or longer-term supply or distribution arrangements, following the transaction, and may result in unexpected liabilities through indemnification or other risk-shifting mechanisms in the applicable divestiture agreement. For example, in connection with the separation of Solventum, the Company and Solventum entered into various agreements that provide for the performance of certain services or provision of goods by each company for the benefit of the other and that may result in unexpected liabilities related to indemnification obligations or non-performance by Solventum. A summary of the material terms of these agreements can be found in the section entitled “Certain Relationships and Related Party Transactions—Agreements with 3M” in Solventum’s Information Statement, dated March 13, 2024, which was included as Exhibit 99.1 to Solventum’s Current Report on 8-K filed with the SEC on March 13, 2024. Any of the foregoing could adversely affect the Company’s future results.

*\* The Company’s future results may be affected by its operational execution, including through organizational restructurings and scenarios where the Company generates fewer productivity improvements than planned.*

The Company’s financial results depend on the successful execution of its business operating plans. The Company utilizes various tools, such as continuous improvement, to improve productivity and reduce expenses and engages in ongoing global business transformation, including restructurings from time to time, to streamline its operations, improve operational efficiency, productivity, and the speed and efficiency with which it serves customers. Workforce restructuring activities impact business groups, functions, and geographies, and the structural reorganization is expected to reduce the size of the corporate center, simplify supply chain, streamline 3M's geographic footprint, reduce layers of management, further align business go-to-market models to customers, and reduce manufacturing roles to align with production volumes, with the goal of improving the Company's longer-term outlook in overall performance. There can be no assurance that we will realize the benefits of such activities, or that such activities will not result in unexpected or negative consequences, such as a reduced ability to generate sales; a relationship impact with employees; or a reduced ability to provide the experience that our customers, suppliers, vendors, and channel partners expect from us. In addition, the ability to adapt to business model and other changes, including responding to evolving customer needs and service expectations, are important, and, if not done successfully, could negatively impact the Company’s ability to win new business and enhance revenue and 3M’s brand. Operational challenges, including those related to customer service, pace of change and productivity improvements, could have a material adverse effect on the Company’s business, financial condition, and results of operations.

### Risks Related to Financial and Capital Markets and Tax Matters

*\* The Company's defined benefit pension and postretirement plans are subject to financial market risks that could adversely impact our results.*

The performance of financial markets and discount rates impact the Company's funding obligations under its defined benefit plans. Significant changes in market interest rates, decreases in the fair value of plan assets and investment losses on plan assets, and legislative or regulatory changes relating to defined benefit plan funding may increase the Company's funding obligations and adversely impact its results of operations and cash flows.

*\* Change in the Company’s credit ratings or increases in benchmark interest rates could increase cost of funding.*

The Company’s credit ratings are important to 3M’s cost of capital. The major rating agencies routinely evaluate the Company’s credit profile and assign debt ratings to 3M. This evaluation is based on a number of factors, which include financial strength, business and financial risk, as well as transparency with rating agencies and timeliness of financial reporting. The Company’s credit ratings have served to lower 3M’s borrowing costs and facilitate access to a variety of lenders. As of the date of this report, 3M has a credit rating of A3, stable outlook from Moody's Investors Service, a credit rating of BBB+, negative outlook from S&P Global Ratings, and a credit rating of A-, stable outlook from Fitch. The addition of further leverage to the Company’s capital structure could impact 3M’s credit ratings in the future. Failure to maintain strong investment grade ratings and further downgrades by the ratings agencies, would adversely affect the Company’s cost of funding and could adversely affect liquidity and access to capital markets. In addition, interest expense could increase due to a rise in interest rates.

*\* Changes in tax rates, laws, or regulations could adversely impact our financial results.*

The Company’s business is subject to tax-related external conditions, such as tax rates, tax laws and regulations, changing political environments in the U.S. and foreign jurisdictions that impact tax examination, and assessment and enforcement approaches. In addition, changes in tax laws including further regulatory developments arising from U.S. or international tax reform legislation could result in a tax expense or benefit recorded to the Company’s Consolidated Statement of Earnings. In connection with the Base Erosion and Profit Shifting (BEPS) Integrated Framework provided by Organization for Economic Cooperation and Development (OECD), determination of multi-jurisdictional taxation rights and the rate of tax applicable to certain types of income may be subject to potential change. Due to the evolving nature of global tax laws and regulations and compliance approaches, it is currently not possible to assess the ultimate impact of these actions on our financial statements, but these actions could have an adverse impact on the Company's financial results.

### Risks Related to the Company’s Aearo Entities and Combat Arms Earplug Settlement

*\* The Company is subject to risks related to the Company's Aearo Entities and CAE Settlement.*

As previously disclosed, and as discussed further in Note 17, “Commitments and Contingencies,” within the Notes to Consolidated Financial Statements, Aearo Technologies sold Dual-Ended Combat Arms – Version 2 earplugs starting in about 1999. 3M acquired Aearo Technologies in 2008 and sold these earplugs from 2008 through 2015, when the product was discontinued. 3M and Aearo Technologies believe the Combat Arms Earplugs were effective and safe when used properly, but nevertheless faced significant litigation relating to the earplugs. In August 2023, the Company and the Aearo Entities entered into a settlement arrangement (as amended, the “CAE Settlement”) which is structured to promote participation by claimants and is intended to resolve, to the fullest extent possible, all litigation and alleged claims involving the CAE sold or manufactured by the Aearo Entities and/or 3M. Pursuant to the CAE Settlement, 3M will contribute a total amount of $6.0 billion between 2023 and 2029. Payments to claimants are subject to certain conditions, including providing 3M with a full release of any and all claims involving the CAE. In March 2024, as of the final registration date for the CAE Settlement, more than 99% of claimants are participating in the settlement. The CAE Settlement is subject to risk and uncertainties, including, but not limited to, whether the anticipated full participation by plaintiffs in the CAE Settlement will be achieved, whether there will be a significant number of future claims by plaintiffs that decline to participate in the CAE Settlement, whether the CAE Settlement is appealed or challenged, the filing and outcome of additional litigation, if any, relating to the products that are the subject of the CAE Settlement, or changes in laws or regulations related to the CAE products or the CAE Settlement.

### Risks Related to the Spin-off of Solventum, the Company’s Former Health Care Business

*\* The Company is subject to risks related to the separation of Solventum, the Company's former Health Care business, into an independent public company.*

On April 1, 2024, the Company completed the planned spin-off of its health care business, which is known as Solventum Corporation, as an independent company. There can be no assurance that the anticipated benefits of the transaction will be realized, or that the costs or dis-synergies of the transaction (including costs of related restructuring transactions) will not exceed the anticipated amounts, in each case in the amounts or within the timeframes that were anticipated. The separation may also impose challenges on the Company and its business, including potential business disruption; the diversion of management time on matters relating to the transaction; the impact on the Company’s ability to retain talent; potential impacts on the Company’s relationships with its customers, employees, regulators, and other counterparties; and the risk that any consents or approvals required will not be obtained or will be obtained subject to material modifications to the terms of the underlying arrangement.

In connection with the separation, the Company and Solventum entered into various agreements that provide for the performance of certain services or provision of goods by each company for the benefit of the other, including a separation and distribution agreement, a transition services agreement, a tax matters agreement, an employee matters agreement, a transition distribution services agreement, a transition contract manufacturing agreement, a stockholder’s and registration rights agreement, an intellectual property cross license agreement, a master supply agreement, and a reverse master supply agreement. Performance under these agreement or other related conditions outside of the Company’s control could materially affect our operations and future financial results.

Following the separation, the Company is a smaller, less diversified company than it was prior to the separation, which could make the Company more vulnerable to factors impacting its performance, such as changing market conditions and market volatility. In addition, the Company may be unable to find suitable alternatives for goods and services that Solventum temporarily provides to the Company pursuant to the agreements noted above, or such alternative goods and services may be more expensive than provided by Solventum to the Company.

The Company retained an equity interest in Solventum in connection with the spin-off. The Company cannot predict the trading price of shares of Solventum’s common stock and the market value of the Solventum shares is subject to market volatility and other factors outside of the Company’s control. The Company intends to divest its ownership interest in Solventum within five years from the spin-off, but there can be no assurance regarding the timing of, or timeframe over which, such divestiture or divestitures may occur, or the amount of proceeds received by the Company in connection with any such divestitures.

In addition, while it is intended that the transaction be tax-free to the Company’s stockholders for U.S. federal income tax purposes, there is no assurance that the transactions will qualify for this treatment. If the spin-off is ultimately determined to be taxable, the Company, Solventum, or the Company’s stockholders could incur income tax liabilities that could be significant. Any of these factors could have a material adverse effect on our business, financial condition, results of operations, cash flows, and the price of our common stock.

Filed Oct 22, 2024.
Source: SEC EDGAR, the filing index for accession 0000066740-24-000101. Last ingested by Listed: Nov 2, 2026, 17:18 ET. No prices; not investment advice.