Mondelez International, Inc.: Form 10-K for the period ended Dec 31, 2025

General

Mondelēz International’s purpose is to empower people to snack right. We sell our products in over 150 countries around the world. We are one of the world’s largest snack companies with global net revenues of $38.5 billion and net earnings of $2.5 billion in 2025. Our core business is making and selling chocolate, biscuits and baked snacks. We also have additional businesses in adjacent, locally relevant categories including gum & candy, cheese & grocery and powdered beverages. Our portfolio includes iconic global and local brands such as Oreo, Ritz, LU, Clif Bar and Tate’s Bake Shop biscuits and baked snacks, as well as Cadbury Dairy Milk, Milka and Toblerone chocolate.

We strive to create a positive impact on the world and communities in which we operate while driving business performance. Our goal is to lead the future of snacking around the world by offering the right snack, for the right moment, made the right way. We aim to deliver a broad range of delicious, high-quality snacks that nourish life’s moments, made with sustainable ingredients and packaging.

Strategy

We aim to be the global leader in snacking by focusing on growth, execution, culture and sustainability. We are optimizing our portfolio of leading brands and have refined our strategy to accelerate growth, prioritizing our fast-growing core categories of chocolate, biscuits and baked snacks. Our strategic plan builds on our strong foundations, including leadership in attractive categories, an attractive global footprint, a strong core of iconic global and local brands, marketing, sales, distribution and cost excellence capabilities and top talent with a growth mindset.

Our plan to drive long-term growth includes four strategic priorities:

• Accelerate consumer-centric growth. Our consumers are the reason we want to be the best snacking company in the world, and we put them at the heart of everything we do. With our consumers in mind, we are focused on accelerating and increasing our focus on chocolate, biscuits and baked snacks by investing in both our global and local brands. We are working to deliver multi-category growth in key geographies, expand our presence in high growth channels and increase our presence in under-represented segments and price tiers. As demands on consumers’ time increase and consumer eating habits evolve, we aim to meet consumers' snacking needs. We plan to test, learn and scale new product offerings quickly to meet diverse and evolving global and local snacking demand.
• Drive operational excellence. Our operational excellence and continuous improvement plans include a special focus on the consumer-facing areas of our business and optimizing our sales, marketing and customer service efforts. To drive productivity gains and cost improvements across our business, we also plan to continue leveraging our global shared services platform, driving greater efficiencies in our supply chain informed by a consumer-centric approach and applying strong cost discipline across our operations. We expect the improvements and efficiencies we drive will fuel our growth and continue to expand profit dollars. We are also focused on boosting digital commerce and on our digital transformation program that will help us to meet consumer demand and generate incremental sales opportunities.
• Build a winning growth culture. To support the acceleration of our growth, we are becoming more agile, digital and local-consumer focused. We are committed to investing in a diverse and talented workforce that helps our business move forward with greater speed and agility along with future-forward growth capabilities. We empower our local teams to innovate and deliver consumers’ snacking needs while continuing to leverage our global scale to efficiently support our growth strategy. We have given our local teams more autonomy to drive commercial and innovation plans as they are closer to the needs and desires of consumers. We will continue to leverage the efficiency and scale of our regional operating units while empowering our local and commercial operations to respond faster to changing consumer preferences and capitalize on growth opportunities. We believe our efforts to continue advancing a winning growth culture will help drive profitable top-line growth.
• Scale sustainable snacking. We continue to focus significant efforts to drive progress against our core initiatives for more sustainable and mindful snacking. We have a clear strategic approach to focus on the areas where we believe we can drive the most impact with a sustainable snacking strategy, with environmental, social and governance (“ESG”) goals and initiatives that include significant involvement and oversight by our leadership and Board of Directors. This includes ongoing efforts to sustainably source key ingredients, reduce our end-to-end environmental impact and enhance our processes and packaging to reduce waste and promote recycling. Please refer to our Sustainability and Mindful Snacking section below for additional information.

We run our business with a long-term perspective and we believe the successful delivery of our strategic plan will drive consistent top- and bottom-line growth and enable us to create long-term value for our shareholders.

Global Operations

We sell our products in over 150 countries and have operations in approximately 80 countries, including 145 principal manufacturing and processing facilities across 49 countries. The portion of our net revenues generated outside the United States was 75.8% in 2025, 74.0% in 2024 and 73.4% in 2023. For more information on our U.S. and non-U.S. operations, refer to Note 18, Segment Reporting; on our manufacturing and other facilities, refer to Item 2, Properties; and on risks related to our operations outside the United States, refer to Item 1A, Risk Factors.

We also monitor our revenue growth across emerging markets and developed markets:

• Our emerging markets include our Latin America region in its entirety; the Asia, Middle East and Africa (“AMEA”) region, excluding Australia, New Zealand and Japan; and the following countries from the Europe region: Russia, Ukraine, Türkiye, Kazakhstan, Georgia, Poland, Czech Republic, Slovak Republic, Hungary, Bulgaria, Romania, the Baltics and the East Adriatic countries.
• Our developed markets include the entire North America region, the Europe region excluding the countries included in the emerging markets definition, and Australia, New Zealand and Japan from the AMEA region.

Reportable Segments

Our operations and management structure are organized into four operating segments:

• Latin America
• AMEA
• Europe
• North America

We manage our operations by region to leverage regional operating scale, manage different and changing business environments more effectively and pursue growth opportunities as they arise across our key markets. Our regional management teams have responsibility for the business, product categories and financial results in the regions.

Please refer to Note 18, Segment Reporting and Management’s Discussion and Analysis of Financial Condition and Results of Operations for additional information.

Product Categories

Our brands span five product categories:

• Biscuits & Baked Snacks (including cookies, crackers, salted snacks, snack bars and cakes & pastries)
• Chocolate
• Gum & candy
• Beverages
• Cheese & grocery

Seasonality

Demand for our products is generally balanced throughout the year, with increases in the fourth quarter primarily because of holidays and other seasonal events. Depending on the timing of Easter, the holiday sales may shift between and affect net revenue in the first and second quarter.

Customers

We generally sell our products to supermarket chains, wholesalers, supercenters, club stores, mass merchandisers, distributors, convenience stores, gasoline stations, drug stores, value stores and other retail food outlets. We also sell products directly to businesses and consumers through various pure play e-retail platforms, retailer digital platforms, our direct-to-consumer websites and social media platforms. No single customer accounted for 10% or more of our net revenues from continuing operations in 2025. For a discussion of long-term demographics, consumer trends and demand, refer to Business Trends within Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Distribution and Marketing

Our product distribution network encompasses direct store delivery, company-owned and satellite warehouses, distribution centers, third party distributors and other facilities. Additionally, we leverage the services of independent sales offices and agents in various international locations. Through our global digital commerce organization and capabilities, we pursue online growth with partners in key markets around the world, including both pure e-tailers and omni-channel retailers. We continue to invest in advertising and consumer promotions, talent and digital capabilities. Our digital commerce channel strategies play a critical role in our ambition to be the global leader in snacking.

Our marketing initiatives are categorized in three principal sets of activities: (i) consumer marketing and advertising including digital and social media, on-air, print, outdoor and other product promotions; (ii) consumer sales incentives such as coupons and rebates; and (iii) trade promotions to support price features, displays and other merchandising of our products by our customers.

Research, Development and Innovation

Our innovation and new product development objectives include growth through new products, superior consumer satisfaction, reduced production costs and continuous improvement in food safety and quality. We have established a robust framework for innovation to drive a technology pipeline supporting the creation of new product bundles across short-, medium- and long-term horizons. These bundles enhance our portfolio to address evolving consumer preferences, market trends and nutritional needs, as well as reduce our environmental impact. We work to test and learn new ideas and implement successful ones into other areas of our business. To drive growth, creativity, greater effectiveness, improved efficiency and accelerated project delivery, we are focusing our technical research and development resources at technical centers around the globe. In 2025, we further enhanced these capabilities through the expansion of our R&D Innovation and Consumer Research Centers as well as collaborative programs that support early-stage ideation and experimentation to challenge traditional product development.

Mindful snacking and sustainability are a significant focus of our current research and development initiatives. We work to introduce new varieties of our core products, including new taste or nutrition profiles that cater to evolving consumer preferences, such as the launch of co-branded chocolate innovations combining Biscoff with Cadbury Dairy Milk, Milka and other key brands in Europe as well as zero sugar Bournvita in India. Additionally, we continue to expand our portfolio of cakes and pastries in new markets and with updated formats including Oreo cakester line extensions and Milka and Lacta croissants in Europe and Brazil, respectively.

Our dedicated innovation and venture hub, SnackFutures, is specifically tailored to leverage emerging consumer trends and growth opportunities in mindful snacking. The core objectives of this group are aligned with three key strategic areas: invent new brands and businesses, invest in early-stage entrepreneurs and amplify SnackFutures’ influence through the CoLab start-up engagement and mentoring programs built to equip start-ups with essential tools, technologies and expertise that can help them learn, grow and succeed.

Competition

We operate in highly competitive markets that are comprised of global, regional and local competitors, including new start-up brands and businesses. Some competitors have different profit objectives and investment time horizons than we do and therefore may approach pricing and promotional decisions differently. We compete based on product quality, brand recognition and loyalty, service, product innovation, taste, convenience, nutritional value, the ability to identify and satisfy consumer preferences, effectiveness of our digital and other sales and marketing strategies, routes to market and distribution networks, promotional activities and price. Our advantaged global footprint, operating scale and portfolio of brands have all significantly contributed to building our market-leading positions across most of the product categories in which we sell. To grow and maintain our market positions, we focus on meeting consumer needs and preferences through a local-first commercial focus with a broad array of product formats, pack sizes and price points, new digital and other sales and marketing initiatives, product innovation and high standards of product quality. We also continue to optimize our manufacturing and supply chain networks and invest in our brands through ongoing research and development, advertising, marketing and consumer promotions.

Raw Materials and Packaging

We purchase and use large quantities of commodities, including cocoa, dairy, wheat, edible oils, sugar and other sweeteners, flavoring agents and nuts. In addition, we purchase and use significant quantities of packaging materials to package our products and natural gas, fuels and electricity for our factories and warehouses. We monitor worldwide supply, commodity cost and currency trends so we can sustainably and cost-effectively secure ingredients, packaging and fuel required for production.

A number of external factors such as the current macroeconomic environment, including global inflation and the effects of geopolitical uncertainty, climate, weather and other conditions affecting plant health and crop yield, commodity, transportation and labor market conditions, exchange rate volatility and the effects of global and local regulations, including trade policies, governmental agricultural or other programs affect the cost and availability of raw materials and agricultural materials used in our products. We address higher commodity costs and currency impacts primarily through hedging, higher pricing and manufacturing and overhead cost control. We use hedging techniques to limit the impact of fluctuations in the cost of our principal raw materials; however, we may not be able to fully hedge against commodity cost changes, such as dairy, where there is a limited ability to hedge, and our hedging strategies may not protect us from increases in specific raw material costs.

For additional information, refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations and Commodity Trends.

Human Capital

We believe the strength of our workforce is one of the significant contributors to our success as a purpose-led, global company. Our employees contribute to our success and help us drive strong financial performance. Attracting, developing and retaining global talent with the right skills to drive our business is central to our purpose, mission and long-term growth strategy.

Workforce Profile: At December 31, 2025, we had approximately 91,000 employees. At December 31, 2025, our workforce was composed of approximately 12,000 U.S. employees and approximately 79,000 employees outside the United States, with employees represented by labor unions or workers’ councils representing approximately 22% of our U.S. employees and approximately 56% of our employees outside the United States.

Workplace Safety and Wellness: We seek to promote a strong culture of safety and prioritize keeping our employees, contractors and visitors safe. To accomplish this, we employ comprehensive health, safety and environment management policies and standards throughout the organization. In addition, we strive to continuously improve our work processes, tools and metrics to mitigate and prevent workplace injuries and enhance safety.

We remain committed to providing a modern and flexible approach to how and where we work. Our hybrid work model allows our office-based employees to engage with colleagues, customers and suppliers in-person on a regular basis while also leveraging innovative technology to optimize collaboration across geographically dispersed teams.

Talent Management and Development: Maintaining a robust pipeline of talent is crucial to our ongoing success and to our succession planning efforts across the organization. Our leadership and people teams are responsible for attracting and retaining top talent by facilitating an environment where employees feel supported and encouraged in their professional and personal development.

Specifically, we review strategic positions regularly and identify potential internal candidates to fill those roles, evaluating job skill sets to identify competency gaps and creating developmental plans to facilitate employee professional growth. We believe in supporting a healthy balance between development and advancement of internal talent and infusion of new talent and capabilities to enhance our teams.

We invest in our employees through training and development programs, on the job experiences, coaching, as well as tuition reimbursement, for a majority of our employees in the United States to promote continued professional growth. We provide access to technical and leadership development programs to enable colleagues to grow skills and capabilities to become more successful. We also have dedicated talent programs that support and accelerate leadership development and strengthen our succession plans. We have expanded and increased global participation in our Talent Marketplace, a development solution that helps connect employees to short-term ‘gig’ opportunities. Additionally, coaching, mentoring and team-based development solutions are provided to colleagues to support leadership, team effectiveness and performance.

Culture and Employee Engagement: We believe that a diverse workforce with a range of experiences and perspectives is a significant driver of sustainable innovation and growth. We continue to focus on creating an inclusive culture for employees, providing employees with opportunities through our development programs and policies. We believe a culture where employees feel heard and managers take action is key to building a highly-engaged workforce that can deliver sustainable business growth. We conduct confidential engagement surveys of our global workforce annually that are administered and analyzed by an independent third party. Aggregate survey results include external benchmark comparisons and are reviewed by executive officers and the Board of Directors. Based on the results, we create action plans at global, regional, functional and managerial levels. By acting on results both at an aggregate enterprise level and a department/business/work group level, we have been able to enhance our culture and improve our overall engagement.

Total Rewards: As part of our total rewards philosophy, we aim to offer competitive compensation and benefits to attract and retain top talent. Our compensation programs are designed to reinforce our growth agenda and talent strategy as well as drive a strong connection between the contributions of our employees and their pay. We believe the structure of our compensation packages provides the appropriate incentives to attract, retain and motivate our employees. Further, to foster a strong sense of ownership and align the interests of employees with shareholders, we grant stock-based incentives to many senior-level employees.

We also continue to evolve our programs to meet our employees’ health and wellness needs. We provide access to medical and welfare benefits and offer programs to employees that support work-life balance, including paid parental leave. Additionally, we offer physical and mental health resources, including employee assistance programs, to our global employees.

We are committed to equal pay for equal work, regardless of personal characteristics. To deliver on that commitment, we benchmark and set pay ranges based on market data and consider various factors such as an employee’s role and experience, job location and performance. We also regularly review our compensation practices to promote fair and equitable pay.

With the support of an independent third-party consultant in this field, we conduct global pay equity reviews for salaried employees based on gender and, in the United States, race (as permitted by local country law). Our last global analysis in 2025 encompassed 78 countries and approximately 36,000 employees. From this analysis, our pay gap between male and female employees was less than 1% when performing substantially similar work at Mondelēz. In the United States, we also review pay for salaried employees in the same pay grade by race/ethnicity (Asian, Black and Hispanic). The 2025 independent analysis found no systemic issues and no negative pay gap between non-white and white employees when performing substantially similar work at Mondelēz.

Sustainability and Mindful Snacking

Snacking Made Right is the lens through which we determine our ESG priorities to deliver on our mission of leading the future of snacking by offering the right snack, for the right moment, made the right way. We have a defined strategic approach to making snacking right, so we can drive innovative, more sustainable business growth.

We focus on key areas where we believe we can deliver greater long-term growth while having a positive impact. Our strategy and goals in these key focus areas are part of supporting our growth around the world and underpinned by our focus on promoting a culture of safety, quality and inclusivity. Our goals include more sustainable sourcing of key ingredients, reducing our environmental footprint, promoting the rights of people across our value chain, and evolving our portfolio to offer a broader range of high-quality snacks addressing consumer needs while encouraging consumers to snack mindfully.

The Governance, Membership and Sustainability Committee of our Board of Directors oversees our ESG policies and programs related to corporate citizenship, social responsibility, and public policy issues significant to us such as sustainability and environmental responsibility; food labeling, marketing and packaging; philanthropic and political activities and contributions; and Board of Directors’ ESG education and capabilities. The People and Compensation Committee of our Board of Directors oversees our human capital priorities, as well as workplace safety and employee wellness, pay equity, talent sourcing strategies, talent management and development programs and KPIs for incentive plans. The Audit Committee of our Board of Directors oversees our safety priorities, goals and performance, as well as our ESG-related disclosures in SEC filings, including controls and assurance. Our ESG goals are part of our risk and strategic planning processes and are also embedded across our organization and within our annual incentive compensation program for our leadership. Business leadership teams and our Board of Directors regularly review progress toward these programs and priorities.

We discuss our ESG goals and programs in detail in our annual Snacking Made Right report available on our website. We also publish an ESG disclosure data sheet and are aligned with the Sustainability Accounting Standards Board and Task Force on Climate-related Financial Disclosures reporting frameworks. We also provide our annual CDP Climate Change, Water Security and Forests disclosure.

Intellectual Property

Our intellectual property rights (including trademarks, patents, copyrights, registered designs, proprietary trade secrets, recipes, technology and know-how) are material to our business.

We own numerous trademarks and patents in many countries around the world. Depending on the country, trademarks remain valid for as long as they are in use or their registration status is maintained. Trademark registrations generally are renewable for fixed terms. We also have patents for a number of current and potential products. Our patents cover inventions ranging from packaging techniques to processes relating to specific products and to the products themselves. Our issued patents extend for varying periods according to the date of patent application filing or grant and the legal term of patents in the various countries where patent protection is obtained. The actual protection afforded by a patent, which can vary from country to country, depends upon the type of patent, the scope of its coverage as determined by the patent office or courts in the country, and the availability of legal remedies in the country. While our patent portfolio is material to our business, the loss of one patent or a group of related patents would not have a material adverse effect on our business.

From time to time, we grant third parties licenses to use one or more of our trademarks, patents and/or proprietary trade secrets in connection with the manufacture, sale or distribution of third-party products. Similarly, we sell some products under brands, patents and/or proprietary trade secrets we license from third parties. In our agreement with Kraft Foods Group, Inc. (which is now part of The Kraft Heinz Company), we each granted the other party various licenses to use certain of our and their respective intellectual property rights in named jurisdictions following the spin-off of our North American grocery business in 2012.

Regulation

Our food products and ingredients are subject to local, national and multinational laws and regulations related to labeling; claims; packaging; production, sale and distribution; quality and safety; marketing and advertising; and related areas. In addition, various jurisdictions regulate our operations by licensing and inspecting our manufacturing plants and facilities, enforcing standards for select food products, grading food products, and regulating trade practices related to the sale and pricing of our food products. Many of the food commodities we use in our operations are subject to government agricultural policy and intervention. These policies have substantial effects on prices and supplies and are subject to periodic governmental and administrative review.

Examples of laws and regulations that affect our business include, without limitation, workplace safety regulations; selective food taxes; data privacy and cybersecurity; ingredient, product, processing or other food-related restrictions, labeling requirements such as front-of-pack labeling based on nutrient profiles or environmental claims; sales, media, or marketing restrictions such as those on promotions or advertising products with certain nutrient profiles on certain channels or platforms or during certain hours of the day; sanctions; export controls on sales or sourcing of raw materials; cross-border trade concessions or border barriers; corporate tax policies of the United States and other countries; and packaging taxes. In addition, many Member States in the European Union have implemented extended producer responsibility (“EPR”) policies as part of national packaging waste policies that make manufacturers responsible for the cost of recycling food and beverage packaging after consumers use it. These range from mandatory regulations to voluntary agreements between government and industry to voluntary industry initiatives. In addition, the European Union has adopted its Packaging and Packaging Waste Directive. EPR policies are being implemented or contemplated in other jurisdictions around the world, including India, Vietnam and certain states in the United States. Single-use plastic bans or plastic taxes are being implemented or considered in Europe as well as countries in Southeast Asia.

Throughout the countries in which we do business, we are subject to local, national and multinational environmental laws and regulations relating to the protection of the environment. We have programs across our business units designed to meet applicable environmental compliance requirements. In the United States, the laws and regulations include the Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act and the Comprehensive Environmental Response, Compensation, and Liability Act. We are also subject to legislation designed to reduce emissions from greenhouse gases, and many countries are considering introducing carbon taxes that could increase our production costs or those of our suppliers.

Differences in government measures and/or uneven enforcement of similar measures across jurisdictions could impact our operations.

We continue to monitor developments in laws and regulations. Also refer to Item 1A, Risk Factors for additional information.

Information about our Executive Officers

The following are our executive officers as of February 4, 2026:

Mr. Van de Put became Chief Executive Officer and a director in November 2017 and became Chairman of the Board of Directors in April 2018. He formerly served as President and Chief Executive Officer of McCain Foods Limited, a multinational frozen food provider, from July 2011 to November 2017 and as its Chief Operating Officer from May 2010 to July 2011. Mr. Van de Put served as President and Chief Executive Officer, Global Over-the-Counter, Consumer Health Division of Novartis AG, a global healthcare company, from 2009 to 2010. Prior to that, he worked for 24 years in a variety of leadership positions for several global food and beverage providers, including Danone SA, The Coca-Cola Company and Mars, Incorporated.

Mr. Zaramella became Executive Vice President, Chief Operating Officer and Chief Financial Officer in February 2026. He previously served as Executive Vice President and Chief Financial Officer from August 2018 to February 2026 and as Senior Vice President Corporate Finance, CFO Commercial and Treasurer from June 2016 to July 2018. He also served as Interim Lead Finance North America from April to November 2017. Prior to that, he served as Senior Vice President and Corporate Controller from December 2014 to August 2016 and Senior Vice President, Finance of Mondelēz Europe from October 2011 to November 2014. Mr. Zaramella joined Mondelēz International in 1996.

Mr. Iyer became Executive Vice President and President, Asia Pacific, Middle East and Africa in June 2023. He previously served as President India from August 2016 to June 2023. Prior to that, Mr. Iyer held various leadership positions of increasing responsibility at PepsiCo, Wrigley India Pvt Ltd and Bharti AXA General Insurance Company, India. Mr. Iyer joined Mondelēz International in 2016.

Mr. Kuhn became Executive Vice President and President, Mondelēz Europe in April 2025. He previously served as President, Hygiene at Reckitt Benckiser Group Plc, a global consumer products company, from May 2021 until December 2024, and as Chief Transformation Officer from January 2020 until April 2021. Prior to joining Reckitt, Mr. Volker spent 26 years at Procter & Gamble, a global consumer products company, holding positions of increasing responsibility in finance, marketing, business development and general management.

Ms. Lilak became Executive Vice President and Chief People Officer in January 2024. She formerly served as the Chief People Officer of Bumble Inc., a social networking company, from November 2021 to January 2023. Previously, Ms. Lilak was Senior Vice President, Chief Human Resources Officer at Dunkin’ Brands Group Inc., a multinational coffee and doughnut company, from July 2019 to November 2021. Prior to Dunkin’ Brands, Ms. Lilak spent 23 years with General Mills Inc., a global consumer foods manufacturer and marketer, in roles of increasing responsibility. She served as Vice President, Human Resources for the North America Retail Segment from January 2016 to July 2019.

Mr. Lozano became Executive Vice President and President, Latin America in April 2022. Prior to joining Mondelēz International, Mr. Lozano spent more than 21 years at Danone SA, a global food and beverage company, in a variety of roles with increasing responsibility. Most recently, he served as CEO at Danone North America from January 2014 to July 2016 and from September 2017 to December 2020.

Mr. Renaud became Executive Vice President and Chief Marketing & Sales Officer in February 2022 and served as Executive Vice President and Chief Marketing Officer from January 2018 until February 2022. Prior to joining Mondelēz International, Mr. Renaud spend more than 28 years at Danone SA, a global food and beverage company, in a variety of roles with increasing responsibility. Most recently, he served as President, Fresh Dairy Europe, from January 2015 to July 2017 after working as Vice President Danone Waters Asia Pacific, from October 2014 to December 2014.

Ms. Stein became Executive Vice President, Corporate & Legal Affairs, General Counsel and Corporate Secretary in September 2023 and was Executive Vice President, Corporate & Legal Affairs and General Counsel from January 2021 until September 2023. Before joining Mondelēz International, Ms. Stein spent 16 years at The Clorox Company, a multinational manufacturer and marketer of consumer and professional products, most recently as Executive Vice President – General Counsel and Corporate Affairs from February 2016 to December 2020. She also served as Executive Vice President – General Counsel from February 2015 to February 2016 and as Senior Vice President – General Counsel from January 2005 to February 2015.

Mr. Valle became Executive Vice President and President, North America in March 2022 and was Executive Vice President and President, Latin America from February 2020 to February 2022. Before joining Mondelēz International, Mr. Valle served as Chief Executive Officer of Axia Plus, LLC, a management consulting firm, from February 2018 to January 2020. Prior to that he spent more than 20 years at Danone SA, a global food and beverage company, in a variety of leadership positions, most recently as Executive Vice President, Dairy Division Worldwide, from January 2015 to January 2018, and Vice President Dairy Division Europe, from January 2014 until December 2014.

Ethics and Governance

We have adopted the Mondelēz International Code of Conduct, which qualifies as a code of ethics under Item 406 of Regulation S-K. The code applies to all of our employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, and persons performing similar functions. Our code of ethics is available free of charge on our web site at www.mondelezinternational.com/Investors/Corporate-Governance (http://www.mondelezinternational.com/Investors/Corporate-Governance) and will be provided free of charge to any shareholder submitting a written request to: Corporate Secretary, Mondelēz International, Inc., 905 West Fulton Market, Suite 200, Chicago, IL 60607. We will disclose any waiver we grant to an executive officer or director under our code of ethics, or certain amendments to the code of ethics, on our web site at www.mondelezinternational.com/Investors/Corporate-Governance (http://www.mondelezinternational.com/Investors/Corporate-Governance).

In addition, we have adopted Corporate Governance Guidelines, charters for each of the Board’s four standing committees and the Code of Business Conduct and Ethics for Non-Employee Directors. All of these materials are available on our web site at www.mondelezinternational.com/Investors/Corporate-Governance (http://www.mondelezinternational.com/Investors/Corporate-Governance) and will be provided free of charge to any shareholder submitting a written request to: Corporate Secretary, Mondelēz International, Inc., 905 West Fulton Market, Suite 200, Chicago, IL 60607.

Available Information

Our Internet address is www.mondelezinternational.com (http://www.mondelezinternational.com). Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the the Exchange Act, are available free of charge as soon as possible after we electronically file them with, or furnish them to, the U.S. Securities and Exchange Commission (the “SEC”). Our filings with the SEC can be accessed by visiting www.sec.gov (http://www.sec.gov) or our website: ir.mondelezinternational.com/sec-filings. The information on our web site is not, and shall not be deemed to be, a part of this Annual Report on Form 10-K or incorporated into any other filings we make with the SEC.

You should carefully read the following discussion of significant factors, events and uncertainties when evaluating our business and the forward-looking information contained in this Annual Report on Form 10-K. The events and consequences discussed in these risk factors could materially and adversely affect our business, operating results, liquidity and financial condition. While we believe we have identified and discussed below the key risk factors affecting our business, these risk factors do not identify all the risks we face, and there may be additional risks and uncertainties that we do not presently know or that we do not currently believe to be significant that may have a material adverse effect on our business, performance or financial condition in the future. Some of the factors, events and contingencies discussed below may have occurred in the past, but the disclosures below are not representations as to whether or not the factors, events or contingencies have occurred in the past and instead reflect our beliefs and opinions as to the factors, events or contingencies that could materially and adversely affect us in the future.

In addition to the effects of ongoing macroeconomic volatility and uncertainty, including current and potential trade and tariff actions affecting the countries where we operate and resulting impacts on our business and operations discussed in Item 7 of this Form 10-K and in the risk factors below, additional or unforeseen effects from these actions may give rise to or amplify many of these risks discussed below.

Strategic and Operational Risks

Commodity and other input prices are volatile and may increase or decrease significantly or availability of commodities may become constrained.

We purchase and use large quantities of commodities, including cocoa, dairy, wheat, edible oils, sugar and other sweeteners, flavoring agents and nuts. In addition, we purchase and use significant quantities of product packaging materials, natural gas, fuel and electricity for our factories and warehouses, and we also incur expenses in connection with labor and the transportation and delivery of our products. Costs of raw materials, energy and other supplies and services are volatile and fluctuate due to conditions that are difficult to predict. These conditions include global competition for resources; tariffs or other trade barriers; currency fluctuations; geopolitical conditions or conflicts (including the ongoing war in Ukraine and international sanctions imposed on Russia for its invasion of Ukraine, conflicts in the Middle East, rising tensions between China and Taiwan and recent geopolitical developments in Venezuela); inflationary pressures related to domestic and global economic conditions or supply chain issues; transportation and labor disruptions; government intervention to introduce living income premiums or similar requirements; changes in environmental or trade policy and regulations, alternative energy and agricultural programs; severe weather; agricultural productivity; animal and crop disease or pests; water risk; health pandemics; forest fires and other natural disasters; acts of terrorism; geopolitical regional conflicts; cybersecurity incidents; supplier capacity; and consumer or industrial demand. During 2025, price volatility and higher aggregate costs were driven by a confluence of factors: soaring commodity prices (especially for cocoa beans), disrupted international supply chains, labor market challenges and increased transportation and labor costs. For additional information, refer to Item 7, Commodity Trends.

Many of these conditions are or could be exacerbated or worsened by climate change. Increased government intervention and consumer or activist responses caused by increased focus on climate change, deforestation, water, plastic waste, animal welfare and human rights concerns and other risks associated with the global food system could adversely affect our or our suppliers’ reputation and business and our ability to procure the materials we need to operate our business. Some commodities are grown by smallholder farmers who might not be able to invest to increase productivity or adapt to changing conditions.

Our efforts to monitor our exposure to commodity prices and hedge against price increases cannot fully protect us from changes in input costs, including due to factors like changing import duties and tariffs, market illiquidity, specific local regulations and downstream costs. Thus, our hedging strategies have not always protected and will not in the future always protect us from increases in specific raw material costs. Continued volatility in the prices of commodities and other supplies we purchase or changes in the types of commodities we purchase as we continue to evolve our product and packaging portfolio could increase or decrease the costs of our products, and our profitability could suffer as a result. Moreover, increases in the price of our products, including increases to cover inflation and higher input, packaging and transportation costs, may result in lower sales volumes or customer delistings, while decreases in input costs could require us to lower our prices and thereby affect our revenues, profits or margins. Likewise, constraints in the supply or availability of key commodities and necessary services like transportation may limit our ability to grow our net revenues and earnings. If our mitigation activities are not effective, if we are unable to price to cover increased costs (including if we are delayed in our ability to raise prices or unable to raise the prices of our products enough to keep up with the rate of inflation), if we must reduce our prices, if increased prices affect demand for our products (including if consumers forego purchasing certain of our products or switch to “private label” or lower-priced product offerings), if we change the recipes of some of our product offerings, or if we are limited by supply or distribution constraints, our financial condition, results of operations, cash flows, reputation and stock price can be materially adversely affected.

We are subject to risks from operating globally, including potential cost impacts of any tariffs that may be enacted by governments as well as other trade and regulatory uncertainty.

We are a global company and generated 75.8% of our 2025 net revenues, 74.0% of our 2024 net revenues and 73.4% of our 2023 net revenues outside the United States. We market our products in over 150 countries and have operations in approximately 80 countries. Therefore, we are subject to risks inherent in global operations. Those risks include:

• the imposition of increased or new tariffs, sanctions, export controls, quotas, trade barriers, labor reforms, price floors or similar restrictions on our sales or key commodities like cocoa, potential changes in U.S. trade programs and trade relations with other countries, restrictions on cross-border data transfers, or regulations, taxes or policies that affect our operations, sales or profitability. Also refer to “We are subject to risks from changes to the trade policies and tariff and import/export regulations by the U.S. and/or other foreign governments”;
• changing macroeconomic conditions in our markets, including as a result of inflation (and related monetary policy actions by governments in response to inflation), volatile commodity prices, the ongoing longer-term impact of changes in international trade policies and increases in the cost of raw and packaging materials, labor, energy and transportation;
• compliance with U.S. laws affecting operations outside of the United States, including anti-bribery laws such as the Foreign Corrupt Practices Act (“FCPA”);
• compliance with antitrust and competition laws, trade laws, data privacy laws, anti-bribery laws, human rights laws, new regulations intended to address increasing global concerns around forced labor, and a variety of other local, national and multinational regulations and laws in multiple regimes;
• currency devaluations or fluctuations in currency values, including in developed and emerging markets. This includes events like applying highly inflationary accounting as we did for our Argentinean subsidiaries beginning in the third quarter of 2018, Türkiye beginning in the second quarter of 2022 and both Egypt and Nigeria beginning in the fourth quarter of 2024;
• changes in capital controls, including currency exchange controls, government currency policies or other limits on our ability to import raw materials or finished products into various countries or repatriate cash from outside the United States;
• increased sovereign risk, such as defaults by or deterioration in the economies and credit ratings of governments, particularly in emerging markets;
• changes or inconsistencies in local regulations and laws, the uncertainty of enforcement of remedies in non-U.S. jurisdictions, and foreign ownership restrictions and the potential for nationalization or expropriation of property or other resources;
• varying abilities to enforce intellectual property and contractual rights;
• discriminatory or conflicting fiscal policies;
• greater risk of uncollectible accounts and longer collection cycles; and
• design, implementation and use of effective control environment processes across our diverse operations and employee base.

In addition, increased political and economic changes or volatility, geopolitical regional conflicts, terrorist activity, political unrest, civil strife, acts of war, government shutdowns, product boycotts, travel or immigration restrictions, tariffs and other trade restrictions, public health risks or pandemics, energy policy or restrictions, public corruption, expropriation and other economic or political uncertainties, including inaccuracies in our assumptions about these factors, could interrupt and negatively affect our business operations or customer demand. High unemployment or the slowdown in economic growth in some markets could constrain consumer spending. Declining consumer purchasing power could result in loss of market share and adversely impact our profitability. The nature and degree of the various risks we face can also differ significantly among our regions and businesses.

We are subject to risks from changes to the trade policies and tariff and import/export regulations by the U.S. and/or other foreign governments.

Changes in the import and export policies, including trade restrictions, new or increased tariffs or quotas, embargoes, sanctions and countersanctions, safeguards or customs restrictions by the U.S. and/or other foreign governments, could require us to change the way we conduct business and adversely affect our financial condition, results of operations, reputation and our relationships with customers, suppliers and employees in the short or long term. Likewise, changes in laws and policies governing foreign trade, manufacturing, development and investment in the territories or countries where we currently sell our products or conduct our business could adversely affect our business.

As of January 2026, the U.S. maintains higher tariffs on imported goods (finished products and inputs) from many trading partners as compared to prior years. Some of these tariffs have increased our costs for finished products, as well as some ingredients and packaging used to produce and distribute our products. In some cases, U.S. tariff policy has also resulted in retaliatory measures on U.S. goods entering foreign markets. The extent and duration of the tariffs and the resulting impact on general economic conditions and on our business are uncertain and depend on various factors, such as negotiations between the U.S. and affected countries, the responses of other countries or regions, exemptions or exclusions that may be granted, availability and cost of alternative sources of supply, and demand for our products in affected markets. Further, actions we take to adapt to new tariffs or trade restrictions may cause us to modify our operations or forgo business opportunities. For additional information, refer to Business Trends – Trade and Regulatory Uncertainty under Management's Discussion and Analysis of Financial Condition and Results of Operations.

The war in Ukraine has impacted and could continue to impact our business operations, financial performance and results of operations.

The war in Ukraine has impacted and could continue to impact our business operations, financial performance and results of operations (as discussed below in Recent Developments and Significant Items Affecting Comparability – War in Ukraine under Management’s Discussion and Analysis of Financial Condition and Results of Operations). The scope and duration of the war in Ukraine is uncertain and rapidly changing, and we are unable to predict the full extent to which the war in Ukraine will impact our business operations, financial performance, results of operations and stock price in the future. We have discontinued new capital investments and suspended our advertising spending in Russia. As the business and geopolitical environment continues to change, our operations and activity in Russia, which accounted for 3.7% of 2025 consolidated net revenues, and/or Ukraine, which accounted for 0.4% of 2025 consolidated net revenues, may decline or be further scaled back. International sanctions, export controls and other measures, including restrictions on the transfer of funds to and from Russia, that have been imposed on Russian entities, make it more difficult to operate in Russia, and failure to comply with applicable sanctions and measures could subject us to regulatory penalties and reputational risk. The war could also result in the temporary or permanent loss of assets due to expropriation or further curtailment of our ability to conduct business operations in Russia, and our Russian assets may become partially or fully impaired, or our operations may be deconsolidated in future periods, or our business operations terminated. In addition, our operations may be subject to increased disruptions to our information systems, including through network failures, malicious or disruptive software or cyberattacks by hackers, criminal groups or nation-state organizations. There is a possibility of loss of life and physical damage and destruction of property. We may not be able to operate in certain areas due to damage and safety concerns. We might also face questions or negative scrutiny from stakeholders about our operations in Russia despite our role as a food company and our public statements about Ukraine and Russia.

The war in Ukraine has continued to result in worldwide geopolitical and macroeconomic uncertainty. The war continues to disrupt commodity markets, including for wheat, energy and energy-related commodities, and continues to contribute to supply chain disruption and inflation. Other ongoing consequences of the war have included increased volatility of input prices, including for packaging materials, energy, commodities, other raw materials, labor and transportation; adverse changes in international trade policies and relations; increased exposure to foreign currency fluctuations, including volatility of the Russian ruble; constraints, volatility or disruptions in the credit and capital markets; increased costs to ensure compliance with global and local laws and regulations; difficulty protecting and enforcing our intellectual property rights; and heightened risk to employee safety including health and safety risks related to securing and maintaining facilities. We expect continued volatility with respect to commodity and other input prices, and our hedging activities might not sufficiently offset this volatility.

These and other impacts of the war in Ukraine could have the effect of heightening many of the other risks described in the risk factors presented in this filing, including those relating to our reputation, brands, product sales, sanctions, trade relations in countries in which we operate, input price inflation and volatility, results of operations and financial condition. We might not be able to predict or respond to all impacts on a timely basis to prevent near- or long-term adverse impacts to our results.

We operate in a highly competitive industry where we face risks related to the execution of our strategy as well as our ability or willingness to respond, timely or otherwise, to channel shifts, pricing and other competitive pressures.

The food and snacking industry is highly competitive. Our principal competitors are food, snack and beverage companies that operate globally, regionally and locally, and, in many markets, include retailers with their own branded and private label products. Failure to effectively respond to actions, innovations or other challenges from our competitors could adversely affect our business.

Competitor and customer pressures require that we timely and effectively respond to changes in relevant markets, including changes to distribution channels and technological developments. These pressures could affect our prices, including our ability to price in response to commodity and other cost increases. Our ability to succeed depends on our ability to adapt to changing market conditions, which includes identifying and responding to new or developing trends, technological advancements (including advancements such as artificial intelligence, machine learning and augmented reality) which are increasingly important for understanding evolving consumer preferences. Our ability to adjust distribution methods and pricing, including adapting to fluctuating inflation, new or increased tariffs, taxes and/or trade barriers, economic conditions and recessions, as well as implementing effective trade incentives is also critical to advancing our priorities. Failure in these areas could negatively impact availability of or demand for our products, our operating results, achievement of our strategic and financial goals and our ability to capitalize on new revenue or value-producing opportunities.

The rapid growth of some channels, such as discounters and digital commerce, may impact our current operations or strategies more quickly than we planned for, create consumer price deflation, alter the buying behavior of consumers or disrupt our retail customer relationships. We may need to increase or reallocate spending on existing and new distribution channels and technologies, marketing, advertising and new product innovation to maintain or increase revenues, market share and brand significance. These expenditures may not be successful, including those related to our digital commerce and other technology-focused efforts, and might not result in trade and consumer acceptance of our efforts, which could materially and adversely affect our product sales, financial condition, results of operations and cash flows. We will be disadvantaged if we are not able to effectively leverage developing online channels such as direct-to-consumer and electronic business-to-business commerce. New distribution channels, as well as growing opportunities to utilize external manufacturers, lower the barriers to entry and allow smaller competitors to gain market share more effectively. Additionally, if we adjust pricing but cannot maintain or increase sales volumes, or our labor or other costs increase but we cannot increase prices to offset those changes, our financial condition and results of operations will suffer.

Further, our ability to compete may be limited by an inability to secure new retailers or maintain or add shelf and/or retail space for our products. There can be no assurance that retailers will provide sufficient, or any, shelf space, nor that online retailers will provide online access to, or adequate product visibility on, their platform. Unattractive placement or pricing may put our products at a disadvantage compared to those of our competitors. Even if we obtain shelf space or preferable shelf placement, our new and existing products may fail to achieve the sales or pricing expectations set by our retailers, potentially causing these retailers to remove our products from their shelves.

Promoting and protecting our reputation and brand image is essential to our business success.

Our success depends on our ability to maintain and enhance our brands, expand within and to new geographies and new distribution platforms such as digital commerce, and evolve our portfolio with new product offerings that meet consumer needs and expectations. We seek to strengthen our brands through investments in our product quality, product renovation, innovation and marketing investments, including consumer-relevant advertising, digital communication and consumer promotions. Actual or perceived failure to effectively address the continuing global focus on well-being, including changing consumer acceptance of certain ingredients, industrial manufacturing and processing, nutritional expectations of our products, the sustainability of our ingredients, our supply chain (including human rights, deforestation, and animal welfare issues) and our packaging (including plastic packaging and its ability to be recycled and other environmental impacts) could adversely affect our brands. Increased negative attention from the media, academics and online influencers, governments, shareholders and other stakeholders in these areas as well as on the role of food marketing, our response to political and social issues or catastrophic events, and other environmental, social, human capital or governance practices could adversely affect our brand image. Undue caution or our failure to react timely in addressing these challenges and trends could weaken our competitive position. Such pressures could also lead to stricter regulations, industry self-regulation that is unevenly adopted among companies, increased transparency in public disclosures, and increased focus on food and snacking, including marketing and labeling practices. Increasing and disparate legal or regulatory restrictions on our labeling, advertising and consumer promotions, or our response to those restrictions, could limit our efforts to maintain, extend and expand our brands. This includes regulations such as front-of-pack labeling and selective food taxes in multiple jurisdictions as well as age-based or location-based restrictions on sales of products with certain nutritional profiles. Moreover, adverse publicity, regulatory developments or legal action against us, our employees, licensees, or other actors in our supply chain related to product quality and safety, where and how we manufacture our products, environmental concerns including climate change and waste management, human and workplace rights across our supply chain, alleged health implications of certain food products or processing methods, labor relations, or antitrust, anti-bribery and anti-corruption compliance could damage our reputation and brand health. Such actions could undermine our customers’ and shareholders’ confidence and reduce demand for our products, even if the regulatory or legal action is unfounded or these matters are immaterial to our operations. Our product sponsorship relationships, including those with celebrity spokespersons, influencers or group affiliations, could also subject us to negative publicity.

In addition, our success in maintaining and enhancing our brand image depends on our ability to anticipate change and adapt to a rapidly changing marketing and media environment, including our increasing reliance on established and emerging social media and online platforms, digital and mobile dissemination of marketing and advertising campaigns, targeted marketing and the increasing accessibility and speed of dissemination of information. A variety of legal and regulatory restrictions as well as our own policies and participation in industry self-regulation initiatives limit how and to whom we market our products. These restrictions may limit our brand renovation, innovation, marketing and promotion plans, particularly as social media and the communications environment continue to evolve. The social media platforms we use to market our products may change their marketing rules or algorithms or may fall out of favor with certain consumer groups, and we may fail to effectively adapt our marketing strategies or may decide to no longer utilize certain platforms for marketing. We might also fail to sufficiently evolve our digital marketing efforts to effectively utilize consumer data. Negative posts or comments about Mondelēz International, our brands or our employees on social media or web sites (whether factual or not) or security breaches related to the use of our social media accounts and failure to respond effectively to these posts, comments or activities could damage our reputation and brand image across the various regions in which we operate. Placement of our advertisements in social media may also result in damage to our brands if the media itself experiences negative publicity. Our brands may also be associated with or appear alongside harmful content including outputs from generative artificial intelligence models. In addition, we might fail to invest sufficiently in maintaining, extending and expanding our brands, our marketing efforts might not achieve desired results and we might be required to recognize impairment charges on our brands or related intangible assets or goodwill. Third parties may sell counterfeit or imitation versions of our products that are inferior or pose safety risks. When consumers confuse these counterfeit products for our products or have a bad experience with the counterfeit brand, they might refrain from purchasing our brands in the future, which could harm our brand image and sales. Third parties might also improperly use our brands as part of phishing or other scams, which could negatively affect our brand image.

We must correctly predict, identify, interpret and meet changes in consumer preferences and demand and offer new and improved products that meet those changes.

Consumer preferences for food and snacking products change continually. Our success depends on our ability to predict, identify, interpret and meet the tastes, dietary habits, packaging, sales channel and other preferences of consumers around the world and to offer products that appeal to these preferences in the places and ways consumers want to shop. There may be further shifts in the relative size of shopping channels in addition to the increasing role of digital tools (including artificial intelligence and machine learning) and commerce for consumers. Our success relies upon managing this complexity to promote and bring our products to consumers effectively. Weak economic conditions, recessions, inflation, new or increased food regulation, taxes, tariffs and/or trade barriers, equity market volatility or other factors, such as global or local pandemics, geopolitical tensions, public boycotts, uncertainty regarding the availability of certain governmental subsidies available to our consumers (such as the Supplemental Nutrition Assistance Program in the U.S.), severe or unusual weather events, and our response to political and social issues or catastrophic events, may affect consumer preferences and demand in ways that are hard to predict. Failure to offer, effectively promote and deliver products that appeal to consumers or to correctly judge consumer demand for our products will impact our ability to meet our growth targets, and our sales and market share could decrease and our profitability could suffer.

We must distinguish between short-term fads and trends and long-term changes in consumer preferences. Our sales can be adversely affected when we do not accurately predict which shifts in consumer preferences or category trends will be long term or we fail to introduce new and evolved products to satisfy changing preferences. In addition, because of our varied and geographically diverse consumer base, we must be responsive to local consumer preferences, including with respect to when and how consumers snack and their desire for premium or value offerings. We must also provide an array of product formats, pack sizes and price points that satisfy the broad spectrum of consumer preferences and use marketing and advertising effectively to reach consumers at the right time with the right message. Increasing and disparate statutory or regulatory restrictions on our ingredients, labeling, advertising and consumer promotions, or our response to those restrictions, could limit our efforts to offer and deliver products that appeal to consumers. Likewise, new or increased tariffs, taxes and/or trade barriers and our response to these tariffs and/or trade barriers could limit our ability to offer and deliver our products on a cost-effective basis. Demand for our products could decrease and our profitability could suffer if we fail to expand and promote our product offerings successfully across product categories, rapidly develop products in faster growing and more profitable categories or reach consumers in efficient and effective ways leveraging data and analytics (including artificial intelligence and machine learning).

Negative perceptions concerning the health, environmental and social implications of certain food products, ingredients, additives, preservatives, packaging materials, sourcing or production methods and other company practices could influence consumer preferences and acceptance of some of our products and marketing programs. For example, consumers have increasingly focused on well-being, including by reducing their consumption of sodium, processed foods and foods with added sugar, using weight-loss drugs and examining the source and authenticity of ingredients in the foods they consume. Statements by public officials relating to alleged risks associated with particular processing methods, ingredients or additives used in our products, or contaminants allegedly present in the larger food or water supply, may affect consumer preferences and/or demand for some of our products. Regulators in some jurisdictions have also imposed, or may impose, taxes or other restrictions on the manufacture, distribution or sale of food and beverage products based on their nutritional profile or inclusion of particular ingredients, which may reduce overall demand for our products. Continuing to focus on and expand our well-being offerings while evolving the ingredient and nutrition profiles of existing products is important to our growth, as is maintaining focus on ethical sourcing and supply chain management opportunities to address evolving consumer preferences. In addition, consumer preferences differ by region, and we must monitor and adjust our use of ingredients and other activities to respond to these regional preferences. We might be unsuccessful in our efforts to effectively respond to changing consumer preferences and social expectations.

Our operations in certain emerging markets expose us to political, economic and regulatory risks.

Our growth strategy depends in part on our ability to expand our operations in emerging markets, including among others Brazil, China, India, Mexico, Argentina, Eastern Europe, the Middle East, Africa and Southeast Asia. However, some emerging markets have greater political, economic and currency volatility and greater vulnerability to infrastructure and labor disruptions than more established markets. In many countries, particularly those with emerging economies, engaging in business practices prohibited by laws and regulations with extraterritorial reach, such as the FCPA and the U.K. Bribery Act, or local anti-bribery laws may be more common. These laws generally prohibit companies and their employees, contractors or agents from making improper payments to government officials, including in connection with obtaining permits or engaging in other actions necessary to do business. Failure to comply with these laws could subject us to civil and criminal penalties that could materially and adversely affect our reputation, financial condition, results of operations and stock price.

In addition, competition in emerging markets is increasing as our competitors grow their global operations and low-cost local manufacturers improve and expand their production capacities. Our success in emerging markets is critical to achieving our growth strategy. Failure to successfully increase our business in emerging markets and manage associated political, economic and regulatory risks could adversely affect our product sales, financial condition, results of operations, cash flows and stock price.

Our use of information technology and third-party service providers exposes us to cybersecurity risks and other business disruptions.

We use information technology and third-party service providers to support our global business processes and activities. Global shared service centers managed by third parties provide a number of services important to conducting our business, including accounting, internal control, human resources and computing functions.

Continuity of business applications and services has been, and may in the future be, disrupted by events such as viruses or malware; other cybersecurity attacks; issues with or errors in systems’ maintenance or security; power outages; hardware or software failures; denial of service attacks; telecommunication failures; natural disasters; terrorist attacks; and other catastrophic occurrences. Our use of technologies such as cloud-based services and applications continues to evolve, presenting new and additional risks in managing access to our data, relying on third parties to manage and safeguard data, ensuring access to our systems and availability of third-party systems.

Our use of third-party technology and business service providers may expose us to cybersecurity and privacy breaches. These can include: (1) compromises of security systems, which could involve circumvention, denial-of-service attacks, or other cyberattacks such as hacking, phishing attacks, computer viruses, ransomware, malware or cyber extortion and (2) internal threats such as employee or insider errors, malfeasance, deepfake or social engineering schemes, physical breaches or other actions or attempts to exploit vulnerabilities. These threats could result in the misuse or compromise of confidential information and Personally Identifiable Information belonging to us or our employees, customers, consumers, partners, suppliers, or government and regulatory authorities. Additionally, continued geopolitical turmoil has heightened the risk of cyberattacks. Our information security program includes capabilities designed to detect, evaluate and mitigate cyber risks against our systems or arising from third-party service providers; however, we may not be able to fully prevent or mitigate cyber threats, particularly to externally-hosted technology and business services that are beyond our control. Additionally, new initiatives, such as those related to digital commerce and direct sales, that increase the amount of confidential and personal information that we process and maintain, increase our potential exposure to a cybersecurity incident. Furthermore, the rapid evolution and increased adoption of artificial intelligence may intensify our cybersecurity risks and create new vectors of exposure. If our controls, disaster recovery and business continuity plans or those of our third-party providers do not effectively respond to or resolve the issues related to any such disruptions in a timely manner, our product sales, financial condition, results of operations and stock price may be materially and adversely affected, and we might experience delays in reporting our financial results, loss of intellectual property and damage to our reputation or brands.

We continue to invest and augment our cybersecurity program and posture with enhanced identity and access management solutions, multi-factor authentication, risk-based access for remote connectivity, privileged access management, network security, backup and disaster recovery, training and awareness, in addition to advanced threat protection emanating from sophisticated, persistent and state-sponsored threat actors, further reducing our attack surface and likelihood of credential thefts and compromise. Further, we have 24/7 security operations, enhancing the monitoring and detection of threats in our environment, including the manufacturing environment and operational technologies, as well as adjusting information security controls based on our threat intelligence information. However, security measures cannot provide absolute security or guarantee that we will be successful in preventing or responding to every breach or disruption on a timely basis. Further, we may not always be able to detect cyberattacks immediately, and once detected, their impact and severity may remain unclear until we have completed a full forensic investigation, which may take a significant amount of time. Taken together, these factors may prevent us from promptly providing complete, accurate and timely information about a cybersecurity incident to our customers, stakeholders, regulators and the public. Consistent with the increasing volume of cyberattacks globally, we are experiencing new and more frequent attempts by third parties to gain access to our systems, such as through increased email phishing of our workforce. Due to the constantly evolving and complex nature of cyber threat actors, we cannot predict the form and impact of any future incident, and the cost and operational expense of implementing, maintaining and enhancing protective measures to guard against increasingly complex and sophisticated cyber threats could increase significantly. As cyberattacks increase in frequency and magnitude around the world, we may be unable to obtain cybersecurity insurance in the amounts and on terms we view as appropriate and favorable for our operations.

We transfer data across local, regional, and national borders to conduct our operations, and we are subject to a variety of continuously evolving and developing laws and regulations in numerous jurisdictions regarding privacy, data protection and data security, including those related to the collection, storage, handling, use, disclosure, transfer and security of personal data. Privacy and data protection laws may be interpreted and applied differently from jurisdiction to jurisdiction and may create inconsistent or conflicting requirements. Our efforts to comply with multijurisdictional privacy and data protection laws and the uncertainty of new laws and regulations will likely increase the complexity of our processes and may impose significant costs and challenges that are likely to increase over time, and we could incur substantial penalties or be subject to litigation related to violations of existing or future data privacy laws and regulations.

We are subject to risks from unanticipated business disruptions.

We manufacture and source products and materials on a global scale. We utilize an interdependent supply chain – a complex network of suppliers and material needs, owned and leased manufacturing locations, external manufacturing partners, distribution networks, shared service delivery centers and information systems that support our ability to provide our products to our customers consistently. Factors that are hard to predict or are beyond our control, like weather, natural disasters, water and energy availability, supply and commodity shortages, animal or crop diseases, port congestions or delays, transport capacity constraints, terrorism, political unrest or armed hostilities, cybersecurity incidents, labor shortages, demonstrations and protests, strikes or work stoppages, new or increased tariffs and/or trade barriers, operational and/or financial instability of our key suppliers and other vendors or service providers, government shutdowns or health pandemics, including any potential impact of climate change on these factors, could damage or disrupt our operations or those of our suppliers, their suppliers, our external manufacturing partners, distributors or other business partners. Failure to effectively prepare for and respond to disruptions in our operations, for example, by not finding alternative suppliers or replacing capacity at key or sole manufacturing or distribution locations or by not quickly repairing damage to our information, production or supply systems, can cause delays in delivering or the inability to deliver products to our customers, and the quality and safety of our products might be negatively affected. Moreover, disputes with significant customers or suppliers, including disputes regarding pricing or performance, could adversely affect our sales, financial condition, and results of operations. The occurrence of a material or extended disruption may cause us to lose our customers’ or business partners’ confidence or suffer damage to our reputation, and long-term consumer demand for our products could decline. We use insurance to transfer our financial risk related to these exposures, but some of the risks we face are difficult or impossible to insure and the timing of insurance recoveries may not match the timing of the financial loss we incur. We are subject to risk related to operational safety, including risk of fire, explosion or accidental contamination. We could also fail to achieve our strategic objectives due to capability or technology deficiencies related to our ongoing reconfiguration of our supply chain to drive efficiencies and fuel growth. Further, our ability to supply multiple markets with a streamlined manufacturing footprint may be negatively impacted by portfolio complexity, significant changes in trade policies, changes in volume produced and changes to regulatory restrictions or labor-related or other constraints on our ability to adjust production capacity in the markets in which we operate. These events could materially and adversely affect our product sales, financial condition, results of operations, cash flows and stock price.

We may not successfully identify, complete or manage strategic transactions.

We regularly evaluate a variety of potential strategic transactions globally, including acquisitions, divestitures, joint ventures, equity method investments and other strategic alliances that could further our strategic business objectives, and acquisitions and joint ventures are an important part of our strategy to increase our exposure to fast-growing snacking segments, fill geographic white spaces and expand into adjacent categories. Such transactions and investments present significant challenges and risks. We may not successfully identify potential strategic transactions to pursue, may not have counterparties willing to transact with us, or we may not successfully identify or manage the risks presented by these strategic transactions, or complete such transactions. Our success depends, in part, upon our ability to identify suitable transactions; negotiate favorable contractual terms; comply with applicable regulations and receive necessary consents, clearances and approvals (including regulatory and antitrust clearances and approvals that may face increased scrutiny); integrate or separate businesses; manage or achieve performance of sustainability goals and initiatives; realize the full extent of the benefits, cost savings or synergies presented by strategic transactions; offset loss of revenue associated with divested brands or businesses; effectively implement control environment processes; minimize adverse effects on existing business relationships with suppliers and customers; achieve accurate estimates of fair value; minimize potential loss of customers or key employees; and minimize indemnities and potential disputes with buyers, sellers and strategic partners. In addition, execution or oversight of strategic transactions may result in the diversion of management attention from our existing business and may present financial, managerial and operational risks.

With respect to acquisitions and joint ventures in particular, we are also exposed to potential risks based on our ability to conform standards, controls, policies and procedures, and business cultures; consolidate and streamline operations and infrastructures; identify and eliminate, as appropriate, redundant and underperforming operations and assets; manage inefficiencies associated with the integration of operations; and coordinate timely and ongoing compliance with applicable laws, including antitrust and competition, environmental, food safety, anti-bribery and corruption and import/export laws. Equity investments and other strategic alliances pose additional risks, as we could share ownership in both public and private companies and in some cases management responsibilities with one or more other parties whose objectives for the alliance may diverge from ours over time, who may not have the same priorities, strategies or resources as we do, or whose interpretation of applicable policies may differ from our own. Transactions or ventures into which we enter might not meet our financial and non-financial control and compliance expectations or yield the anticipated benefits. Depending on the nature of the business ventures, including whether they operate globally, these ventures could also be subject to many of the same risks we are, including political, economic, regulatory and compliance risks, currency exchange rate fluctuations, and volatility of commodity and other input prices.

Furthermore, we may not be able to complete, on terms favorable to us, desired or proposed divestitures of businesses that do not meet our strategic objectives or our growth or profitability targets. Our divestiture activities, or related activities such as reorganizations, restructuring programs and transformation initiatives, may require us to provide or receive transitional support and/or ongoing commercial relationships, recognize impairment charges or take action to reduce costs that remain after we complete a divestiture. Gains or losses on the sales of, or lost operating income from, those businesses may also affect our profitability. Any of these risks could materially and adversely affect our business, product sales, financial condition, results of operations, cash flows and stock price.

Macroeconomic and Industry Risks

Our business is subject to an increasing focus on sustainability matters.

We have announced, and may from time to time announce, certain initiatives, including goals, targets and other objectives, related to sustainability matters. Our efforts to research, establish, accomplish, and accurately report on these goals, targets and other objectives do not guarantee we will ultimately achieve or maintain them and expose us to numerous operational, reputational, financial, legal and other risks. Our ability to achieve any stated goal, target or objective is subject to numerous factors and conditions, many of which are outside of our control. Examples of such factors include evolving regulatory requirements affecting sustainability standards or disclosures or imposing different requirements, the reliance on other value chain actors to implement the required changes, the pace of changes in technology and the availability of suppliers that can meet our sustainability and other standards. In addition, statements about our sustainability goals, targets and other objectives, and progress against those goals, targets and other objectives, may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve and assumptions that are subject to change in the future. Our selection, interpretation and application of voluntary disclosure frameworks and standards may change from time to time or differ from those of others. Reporting methods for this data may be updated and previously reported data may be adjusted to reflect improvement in availability and quality of third-party data, changing assumptions, changes in the nature and scope of our operations, and other changes in circumstances, which could result in significant revisions to our current goals, reported progress in achieving such goals, or ability to achieve such goals in the future. Further, developing and collecting, measuring and reporting sustainability-related information and metrics can be costly, difficult and time consuming and is subject to evolving reporting standards, including recent legislation in California related to reporting greenhouse gas emissions and climate-related financial risk, the SEC’s climate-related reporting requirements (which are currently suspended, pending the outcome of ongoing legal challenges), and similar proposals by other international regulatory bodies such as in the European Union, especially to the extent these standards are not harmonized or consistent.

Our business may face increased scrutiny from the investment community, customers, consumers, employees, activists, media, regulators and other stakeholders related to our sustainability initiatives, including the goals, targets and objectives that we announce, and our methodologies and timelines for pursuing them. We may be unable to satisfy all stakeholders, as they and regulators have also expressed or pursued opposing views, legislation and investment expectations with respect to sustainability initiatives, including through the enactment or pursuit of legislation or policies or challenging such initiatives. If our sustainability practices do not meet evolving investor or other stakeholder expectations and standards or if we are unable to satisfy all stakeholders, our reputation, our ability to attract or retain employees, our sales and our attractiveness as an investment, business partner or as an acquiror could be negatively impacted. Similarly, our failure or perceived failure to pursue or fulfill our goals, targets and objectives, to comply with ethical, environmental or other standards, regulations or expectations, or to satisfy various reporting standards with respect to these matters, within the timelines we announce, or at all, could have the same negative impacts, as well as expose us to government enforcement actions, fines and private litigation. Even if we achieve our goals, targets and objectives, we may not realize all of the benefits that we expected at the time they were established.

Changes in weather patterns around the globe, including as a result of climate change, expose us to physical and transition risks.

Physical risks include the increasing frequency of extreme weather events and natural disasters and effects on water availability and quality and biodiversity loss. These impacts increase risks to the global food production and distribution system and to the safety and resilience of the communities where we live, work and source our ingredients, and could further decrease food security for communities around the world. Decreased agricultural productivity caused by such physical risks has limited and in the future may continue to limit the availability of the commodities we purchase and use and increase the costs of such products. These include cocoa, which is a critical raw material for our chocolate and biscuits & baked snacks portfolios that is particularly sensitive to changes in climate and has recently had a global decrease in availability and increase in price, as well as other raw materials such as dairy, wheat, vegetable oils, sugar and nuts. Weather events such as floods, severe storms or water shortages, including those partially caused or exacerbated by climate change might disrupt our business operations or those of our suppliers, their suppliers, our external manufacturing partners, distributors or other business partners and could increase our insurance and other operating costs.

Transition risks include increased focus by federal, state and local regulatory and legislative bodies globally regarding environmental policies relating to climate change, regulating greenhouse gas emissions (including carbon pricing or a carbon tax), energy policies, disclosure obligations and sustainability (including single use plastics). New legal and regulatory requirements have increased and could continue to increase our operating costs for things like energy or packaging through taxes or regulations, including payments under extended producer responsibility policies, taxes on specific packaging material types and targets to increase the use of reuse/refill delivery models. Regulations intended to reduce carbon emissions, including any actual or proposed carbon taxes, could also substantially increase our product supply chain and distribution costs. Changes we make to align ourselves with such legal or regulatory requirements may be insufficient to avoid significant penalties or potential litigation if such laws and regulations are interpreted and applied in a manner inconsistent with our practices. Similarly, we may incur substantial costs if such legal or regulatory requirements are subsequently reversed or modified. Concern about climate change might cause consumer preferences to switch away from products or ingredients considered to have high climate change impact and towards products that are more sustainably grown and made. We expect to incur additional costs as we evolve our portfolio and engage in due diligence, verification and reporting in connection with our sustainability initiatives. We might not effectively address increased attention from the media, shareholders, activists and other stakeholders on climate change and related environmental sustainability matters, including deforestation, land use, water use and packaging, including plastic. Those stakeholders might also have requests or proposals that are not aligned with the focus of our efforts on climate change and sustainability matters. Climate change-related impacts could also reduce demand for our products. If costs for raw materials increase or availability decreases, we raise prices for our products and our competitors respond differently to those cost or availability pressures, demand for our products and our market share could suffer. We have also experienced decreased demand for chocolate during periods when temperatures are warmer.

In 2021, we announced our goal of net zero greenhouse gas emissions by 2050. Achieving this goal will require significant transformation of our business, capital investment and the development of technology that might not currently exist. We might incur significant additional expenses or be required to recognize impairment charges in connection with our efforts, and we might be unable to achieve, or be perceived to fail to achieve, our goal.

Our retail customers are consolidating, and we must offer an effective value proposition in order to compete against retailer and other economy brands.

Retail customers, such as supermarkets, discounters, digital commerce merchants, warehouse clubs and food distributors in the European Union, the United States and other major markets, continue to consolidate, form buying alliances or be acquired by new entrants in the food retail market, resulting in fewer, larger customers. Large retail customers and customer alliances can delist our products or reduce the shelf space allotted to our products and demand lower pricing, increased promotional programs or longer payment terms. Retail customers might also adopt these tactics in their dealings with us in response to the significant growth in online retailing for consumer products, which is outpacing the growth of traditional retail channels. The growth of alternative online retail channels, such as direct-to-consumer and electronic business-to-business, may adversely affect our relationships with our large retail and wholesale customers.

In addition, larger retail customers have the scale to develop supply chains that permit them to operate with reduced inventories or to develop and market their own retailer and other economy brands that compete with some of our products. Our products must provide higher quality or value to our consumers than the less expensive alternatives, particularly during periods of economic uncertainty, recessions or significant inflation. Consumers may not buy our products if they perceive little difference between the quality or value of our products and those of retailer or other economy brands. If consumers prefer or otherwise choose to purchase the retailer or other economy brands, we can lose market share or sales volumes, or we may need to shift our product mix to lower margin offerings.

Retail consolidation also increases the risk that adverse changes in our customers’ business operations or financial performance will have a corresponding material adverse effect on us. For example, if our customers cannot access sufficient funds or financing, then they may delay, decrease or cancel purchases of our products, or delay or fail to pay us for previous purchases.

We are subject to changes in our relationships with significant customers, suppliers and distributors.

During 2025, no single customer accounted for more than 10% of our net revenues. However, there can be no assurance that our customers will continue to purchase our products in the same mix or quantities or on the same terms as in the past, particularly as increasingly powerful retailers continue to demand lower pricing and develop their own brands. The loss of or disruptions related to a significant customer could result in a material reduction in sales or change in the mix of products we sell to the customer. This could materially and adversely affect our product sales, financial condition, results of operations, cash flows and stock price.

Disputes with significant customers, suppliers or distributors, including disputes related to pricing or performance and any resultant refusal to provide shelf and/or retail spaces for our products, could adversely affect our ability to supply or deliver products or operate our business and could materially and adversely affect our product sales, financial condition and results of operations. The financial condition of our significant customers and business partners are affected by events that are largely beyond our control. New regulations can also affect our commercial practices and our relationship with customers, suppliers or distributors.

We may be unable to hire or retain and develop key personnel or a highly skilled global workforce or effectively manage changes in our workforce and respond to shifts in labor availability.

We must attract, hire, retain and develop effective leaders and a highly skilled global workforce. We compete to hire new personnel with a variety of capabilities in the many countries in which we manufacture and market our products and then to develop and retain their skills and competencies. We have experienced and could continue to experience unplanned or increased turnover of employees with key capabilities, and we could fail to develop adequate succession plans for leadership positions or hire and retain a workforce with the skills and in the locations we need to operate and grow our business. We could also fail to attract and develop personnel with key emerging capabilities that we need to continue to respond to changing consumer and customer needs and grow our business, including skills in the areas of advanced technology, artificial intelligence, machine learning, digital commerce, data analytics and supply chain expertise. Occurrence of any of these conditions could deplete our institutional knowledge base and erode our competitiveness.

We are experiencing an increasingly tight and competitive labor market and could face unforeseen challenges in the availability of labor. A sustained labor shortage or increased turnover rates within our employee base as a result of general macroeconomic factors (including high inflation and hyperinflation in certain markets), have led and in the future could continue to lead to increased costs, such as increased overtime to meet demand and increased wages to attract and retain employees. We have also been negatively affected and could continue to be negatively affected by labor shortages or constraints experienced by our partners, including our external manufacturing partners, freight providers, other strategic suppliers and distributors. Failure to maintain a highly skilled workforce and leadership team, compensate our employees competitively and fairly, maintain a safe and inclusive environment or promote the well-being of our employees could affect our reputation and also result in lower performance and an inability to retain valuable employees.

We must address changes in, and that affect, our workforce and satisfy the legal requirements associated with how we manage and compensate our employees. This includes our management of employees represented by labor unions or workers’ councils, who represent approximately 56% of our 79,000 employees outside the United States and approximately 22% of our 12,000 U.S. employees. Strikes, work stoppages or other forms of labor unrest by our employees or those of our suppliers, distributors or other business partners, or situations like the renegotiation of collective bargaining agreements, have in the past and may in the future cause disruptions to our supply chain, manufacturing or distribution processes. Changes in immigration laws and policies or restrictions could make it more difficult to recruit or relocate skilled employees. We could also fail to effectively respond to evolving perceptions and goals of those in our workforce or whom we might seek to hire with respect to flexible working or other matters.

Legal and Regulatory Risks

We face risks related to complying with changes in and inconsistencies among laws and regulations in many countries in which we operate.

Our activities around the world are highly regulated and subject to government oversight. Various laws and regulations govern food production, sourcing, packaging and waste management (including packaging containing PFAS), storage, distribution, sales, advertising, labeling and marketing, as well as intellectual property, competition, antitrust, trade and export controls, labor (including human rights), tax, social and environmental matters, privacy, data protection, machine learning and artificial intelligence, and health and safety practices. Government authorities regularly change laws and regulations, their interpretations of existing laws and regulations, and their enforcement priorities. Our failure to comply with existing laws and regulations (including allegations thereof), or to make changes necessary to comply with new or revised laws and regulations (including interpretations thereof) or evolving interpretations and application of existing laws and regulations, and differing or competing laws and regulations across the markets where our products are made, manufactured, distributed and sold, could materially and adversely affect our product sales, financial condition, results of operations and cash flows, including as a result of higher compliance costs, higher capital expenditures and higher production costs. For instance, our financial condition, results of operations and cash flows could be negatively affected by the regulatory and economic impact of changes in the corporate tax policies of the United States and other countries; tariff policies and trade relations among the United States and other countries, including China, Mexico, Canada and the European Union; and recent regulatory initiatives within the European Union, including the EU Deforestation Regulation and the Corporate Sustainability Due Diligence Directive. Furthermore, as the legal and regulatory environment for artificial intelligence and other emerging technologies continues to evolve, our compliance obligations may significantly increase our costs or limit the extent to which we are able to use these technologies. Evolving expectations on sustainability disclosures and reporting will also result in new regulatory actions. In addition, findings in studies or claims made in the media (whether or not scientifically valid) concerning the health implications of consumption of certain ingredients or substances present in certain of our products or packaging materials have resulted in and could continue to result in our being subject to new taxes and regulations or lawsuits that can adversely affect our business.

We may decide or be required to recall products or be subjected to product liability claims or litigation.

We could decide, or laws or regulations could require us, to recall products due to suspected or confirmed deliberate or unintentional product contamination, including contamination of ingredients we use in our products that third parties supply, spoilage or other adulteration, the introduction of foreign objects, food-borne illnesses, product mislabeling or product tampering. These risks could be heightened in light of increased pressure on our suppliers from supply chain challenges. Our facilities and products, and those of our suppliers, may also be subject to inspection by national, federal, state and local authorities, potentially revealing product quality or safety issues. In addition, if another company recalls or experiences negative publicity related to a product in a category in which we compete, consumers might reduce their overall consumption of products in this category. Any of these events could materially and adversely affect our reputation, brands, product sales, financial condition, results of operations, cash flows and stock price.

We may also suffer losses when our products or operations or those of our suppliers violate applicable laws or regulations, or when our or our suppliers’ products cause injury, illness or death. In addition, our marketing could face claims of false or deceptive advertising or other criticism. A significant product liability or related claim or other legal judgment against us, a regulatory enforcement action, a widespread product recall or comments relating to the safety of our products could materially and adversely affect our reputation and profitability. Moreover, even if a product liability, consumer fraud or other claim, litigation or investigation has no merit, is not pursued or is unsuccessful, the negative publicity surrounding assertions against our products, processes or conduct could materially and adversely affect our reputation, brands, product sales, product inventory, financial condition, results of operations, cash flows and stock price, and we could incur significant expense responding to such a claim, litigation or investigation. For example, a purported personal injury lawsuit filed in December 2024 against a number of food companies, including us (Bryce Martinez vs. Kraft Heinz Co. Inc. et al.), alleged that certain food products we and other companies make are addictive and cause health problems. While we believe that our position is well-supported and we intend to vigorously defend ourselves, we cannot predict the outcome or the impact of such litigation or similar lawsuits on our business or reputation. In addition, while we currently maintain insurance coverage that, subject to its terms and conditions, is intended to address costs associated with certain aspects of product recalls, this insurance coverage may not, depending on the specific facts and circumstances surrounding an incident, cover all losses or all types of claims that arise from an incident, or the damage to our reputation or brands that may result from an incident.

We face risks related to legal or tax claims, litigation, investigations or other regulatory enforcement actions.

We operate around the world in environments with constantly evolving legal, tax and regulatory frameworks, and we are subject to risk of litigation, legal or tax claims, investigations, or other regulatory enforcement actions. Actions by our employees, contractors, agents or others in violation of our policies and procedures could lead to deficiencies in our internal or other controls or violations, unintentional or otherwise, of laws and regulations. We could also be subject to litigation, legal claims, investigations or regulatory actions in connection with the continued evolution of our sustainability-related initiatives. In addition, we may be impacted by litigation trends, including class action, individual or multi-jurisdiction lawsuits, or investigations or enforcement actions involving consumers, employees, shareholders or other stakeholders. For example, as a global snacking company, we are subject to increased regulatory scrutiny and face legal challenges in a variety of jurisdictions concerning the alleged health implications of certain food products and our methods in marketing those products. When litigation, legal or tax claims, investigations or regulatory enforcement actions arise out of our failure or alleged failure to comply with applicable laws, regulations or controls, we could be subject to civil and criminal penalties, and voluntary and involuntary document requests, that could materially and adversely affect our reputation, product sales, financial condition, results of operations, cash flows and stock price. Even if a claim, lawsuit, investigation, enforcement action or other action is unsuccessful, without merit or not pursued to completion, the reputational impact or cost of responding to such a claim, including expenses and management time, could adversely affect us.

We face risks related to adequately protecting our valuable intellectual property rights.

We consider our intellectual property rights (including trademarks, patents, copyrights, registered designs, proprietary trade secrets, recipes, technology and know-how) to be a material part of our business. We attempt to protect our intellectual property rights in various ways by asserting rights under applicable intellectual property laws in various countries, using licensing agreements, third-party nondisclosure, assignment and other agreements and monitoring for and enforcing against third-party misuses and infringement of our intellectual property, including in traditional retail and digital environments. We cannot be certain that the legal steps we are taking are sufficient to protect our intellectual property rights or that, notwithstanding legal protection, others do not or will not infringe or misappropriate our intellectual property rights. Our failure to obtain or adequately protect our intellectual property rights (including in response to developments in artificial intelligence technologies), or any change in law or other changes that serve to lessen or remove the current legal protections of our intellectual property, may diminish our competitiveness and could materially harm our business, financial condition and stock price.

We may be unaware of potential third-party claims of intellectual property infringement relating to our technology, brands or products. Furthermore, the use of artificial intelligence and machine learning in our operations may elevate the risk of third-party infringement claims, especially those related to our alleged unauthorized use of third-party tools, technology or content. Any litigation regarding intellectual property could be costly and time-consuming and could divert management’s and other key personnel’s attention from our business operations. Third-party claims of intellectual property infringement might require us to pay monetary damages or enter into costly license agreements. We also may be subject to injunctions against development and sale of certain of our products, which could include removal of existing products from sale.

Financial Risks

We face risks related to tax matters, including changes in tax laws and rates, disagreements with taxing authorities and imposition of new taxes.

As a global company, we are subject to taxation in the United States and various other countries and jurisdictions. As a result, our effective tax rate is determined based on the income and applicable tax rates in the various jurisdictions in which we operate. Our future effective tax rates could be affected by changes in the composition of earnings in countries with differing tax rates or other factors, and adverse changes in the underlying profitability or financial outlook of our operations could lead to changes in the realizability of our deferred tax assets, resulting in a change to our effective tax rate.

Changes in tax laws in the U.S. or in other countries where we have significant operations, including rate changes or corporate tax provisions that could disallow or tax perceived base erosion or profit shifting payments or subject us to new types of tax, could materially affect our effective tax rate and our deferred tax assets and liabilities. On July 4th, 2025, the United States enacted the One Big Beautiful Bill Act (“OBBBA”). The legislation implemented many new U.S. domestic and international tax provisions. Although the U.S. Treasury provided some clarifying guidance during 2025, it is expected they will continue to issue additional guidance in 2026. In addition, many U.S. states have not yet updated their laws to take into account the new federal legislation. It is possible that OBBBA, or interpretations under it, could change and could have an adverse effect on us, and such effect could be material.

In addition, aspects of any new or proposed changes to U.S. tax laws may lead foreign jurisdictions to respond by enacting additional tax legislation that is unfavorable to us. As of December 31, 2025, numerous countries have now enacted the Organization for Economic Cooperation and Development’s model rules for a global minimum tax, with the earliest effective date being for taxable years beginning after December 31, 2023. However, on January 5, 2026, the OECD Inclusive Framework members approved changes to the model rules, including the introduction of a “side by side” rule which would exempt U.S.-parented companies from certain aspects of the global minimum tax regime. The updated model rules will need to be incorporated into local tax legislation to be effective. Important details of these minimum tax regimes are still being considered, which could increase tax uncertainty in the short term. Based on the guidance available thus far, we do not expect this legislation to have a material impact on our consolidated financial statements, but we will continue to evaluate it as additional guidance and clarification becomes available.

We are also subject to tax audits by governmental authorities. Although we believe our tax estimates are reasonable, if a taxing authority disagrees with the positions we have taken, we could face additional tax liabilities, including interest and penalties.

We are subject to currency exchange rate fluctuations.

As of December 31, 2025, we sold our products in over 150 countries and had operations in approximately 80 countries. Consequently, a significant portion of our business is exposed to currency exchange rate fluctuations. Our financial position and operating results are sensitive to movements in currency exchange rates, which have recently been more volatile, because a large portion of our assets, liabilities, revenue and expenses must be translated into U.S. dollars for reporting purposes or converted into U.S. dollars to service obligations such as our U.S. dollar-denominated indebtedness and to pay dividends to our shareholders. In addition, movements in currency exchange rates affect transaction costs because we source product ingredients from various countries. Our efforts to mitigate our exposure to exchange rate fluctuations, primarily on cross-currency transactions, may not be successful. We factor exchange rate impacts into our local pricing decisions, but there may be lags in implementing pricing changes due to competitive pressures or customer or regulatory constraints. We also hedge a number of risks including exposures to foreign exchange rate movements and volatility of interest rates that could impact our future borrowing costs. Hedging of these risks could potentially subject us to counter-party credit risk. In addition, local economies, monetary policies and currency hedging availability affect our ability to hedge against currency-related economic losses. We might not be able to successfully mitigate our exposure to currency risks due to factors such as continued global and local market volatility, actions by foreign governments, trade disputes, economic sanctions, political uncertainty, inflation, interest rates and limited hedging opportunities.

Weak financial performance, downgrades in our credit ratings, illiquid global capital markets and volatile global economic conditions could limit our access to short-term financing, reduce our liquidity and/or increase our borrowing costs.

We regularly access the commercial paper markets in the United States and Europe for ongoing funding requirements. A downgrade in our credit ratings by a credit rating agency could increase our borrowing costs and adversely affect our ability to issue commercial paper. Disruptions in the global commercial paper market or other effects of volatile economic conditions on the global credit markets also could reduce the amount of commercial paper that we could issue and raise our borrowing costs for both short- and long-term debt offerings. Additionally, we use cash management programs, such as factoring and supply chain finance arrangements, in our business when circumstances are favorable to manage liquidity. If these programs or underlying customer or supplier terms do not continue and we are unable to secure alternative programs, our cash and working capital may be negatively affected and we may have to utilize our various financing arrangements or increase our long-term borrowings for short- and long-term liquidity requirements.

Volatility in the global capital markets, interest rates, inflation rates, our participation in multiemployer pension plans and other factors could increase our costs relating to our employees’ pensions.

We sponsor defined benefit pension plans for a number of our employees throughout the world and also contribute to other employees’ pensions under defined benefit plans that we do not sponsor. At the end of 2025, the projected benefit obligation of the defined benefit pension plans we sponsor was $7.1 billion and plan assets were $7.8 billion.

For defined benefit pension plans that we maintain, the difference between plan obligations and assets, or the funded status of the plans, significantly affects the net periodic benefit costs of our pension plans and the ongoing funding requirements of those plans. Our largest funded defined benefit pension plans are funded with trust assets invested in a globally diversified portfolio of investments, including equities and corporate and government debt. Among other factors, changes in interest rates, inflation rates, mortality rates, early retirement rates, investment returns, funding requirements in the jurisdictions in which the plans operate and the market value of plan assets affect the level of plan funding, cause volatility in the net periodic pension cost and impact our future funding requirements. Legislative and other governmental regulatory actions may also increase funding requirements for our pension plan benefit obligations. Volatility in the global capital markets may increase the risk that we will be required to make additional cash contributions to these company-sponsored pension plans and recognize further increases in our net periodic pension cost.

We also participate in multiemployer pension plans for certain U.S. union-represented employees. As a participating employer under multiemployer pension plans, we may owe more than the contributions we are required to make under the applicable collective bargaining agreements. For example, if we partially or completely withdraw from a multiemployer pension plan, we may be required to pay a partial or complete withdrawal liability. This kind of withdrawal liability will generally increase if there is also a mass withdrawal of other participating employers or if the plan terminates. Refer to Note 10, Benefit Plans, to the consolidated financial statements for more information on our multiemployer pension plans.

We are committed to our goal to protect sensitive business-related and personal information, as well as our information systems. Due to the size and scope of our global operations, we are subject to numerous and evolving cybersecurity risks that could adversely and materially affect our business, financial condition and results of operations.

Our Management Leadership Team, with oversight from the Board of Directors, has implemented a comprehensive cybersecurity program, including incident response process, aligned with the National Institute of Standards and Technology (NIST) Cybersecurity Framework and NIST Computer Security Incident Handling Guide (NIST SP 800-61) to assess, identify, address and manage risks from cybersecurity risks that may result in material adverse effects on the confidentiality, integrity and availability of our business and information systems.

Governance

Our Board of Directors and Management Leadership Team review cybersecurity risks as part of their oversight and execution of the Company’s business operations and strategy. We have established oversight mechanisms intended to provide effective cybersecurity governance, risk management, and timely incident response.

Board of Directors Oversight

Our Board, in coordination with the Audit Committee, oversees the Company’s enterprise risk management process, including the management of risks arising from cybersecurity threats. Our Board has delegated the primary responsibility to oversee cybersecurity matters to the Audit Committee. Both the Board and the Audit Committee periodically review the measures we have implemented to identify and mitigate data protection and cybersecurity risks.

As part of such reviews, our Board and Audit Committee receive periodic reports and presentations from members of the team responsible for overseeing cybersecurity risk management, including our Chief Information Security Officer (CISO), which may address a wide range of topics including recent developments, evolving standards, vulnerability assessments, third-party and independent reviews, technological trends and information security considerations arising with respect to our peers and third parties. Members of our Management Leadership Team also report to the Board more frequently than annually on data protection and current internal and external developments in cybersecurity, as part of the Board’s enterprise risk management review, and the Board receives reports of Audit Committee discussions regarding its oversight of cybersecurity risk. We have protocols by which certain cybersecurity incidents that meet established reporting thresholds are escalated internally and, where appropriate, reported to the Audit Committee or the Board in a timely manner.

Management Role in Cybersecurity Risk Management

At the management level, our CISO has extensive cybersecurity knowledge and skills gained from over 20 years of work experience at Mondelēz and other major consumer goods and financial services companies. Our CISO currently reports to our Chief Information and Digital Officer and has operational responsibility for our information security programs, protections, and efforts, along with leading the team responsible for implementing, monitoring, and maintaining cybersecurity and data security strategy, policy, standards, architecture, and practices across our business. Our CISO is supported by a team of information system security and risk professionals, including regional information security officers responsible for overseeing cybersecurity strategy and operations in each business unit. Our CISO receives reports on cybersecurity threats on an ongoing basis and regularly reviews risk management measures implemented by the Company to identify and mitigate data security and cybersecurity risks. Our CISO updates the Management Leadership Team on these matters and works closely with Corporate and Legal Affairs to oversee compliance with legal, regulatory, and contractual security requirements.

Cybersecurity Steering Committee

Our Cybersecurity Steering Committee currently includes our CEO, CFO, CISO, General Counsel and Chief Ethics & Compliance Officer and has broad oversight of our cybersecurity risk management processes, in coordination with the rest of the Management Leadership Team and the Board. The Cybersecurity Steering Committee has been established to meet and to discuss our cybersecurity risk management measures designed to identify and mitigate data protection and cybersecurity risks, along with procedures and practices related to incident response, including escalation and notification.

Risk Management and Strategy

Cybersecurity risk management is overseen both as a critical component of our overall risk management program and as a standalone program. We have implemented a risk-based, cross-functional approach to identifying, preventing and mitigating cybersecurity threats and incidents, while also implementing controls and procedures that provide for the prompt escalation of certain cybersecurity incidents so that decisions regarding the public disclosure and reporting of such incidents can be made by management in a timely manner.

Our cybersecurity program is designed to leverage people, processes, and technology to identify and respond to cybersecurity threats in a timely manner. Our vendor cybersecurity risk management program supports the planning, automation, and management of cybersecurity risk with enrolled suppliers and other third parties, focusing on risk-based assessments. Our employees undergo annual security awareness training to enhance their understanding of cybersecurity threats and their ability to identify and escalate potential cybersecurity events. We also employ systems and processes designed to oversee, identify, and reduce the potential impact of a security incident at a third-party vendor, service provider or customer or otherwise implicating the third-party technology and systems we use.

We assess, identify, and manage risks from cybersecurity threats through various mechanisms, which may include tabletop exercises to test our preparedness and incident response process, business unit assessments, control gap analyses, threat modeling, penetration tests, vulnerability scanning, internal audits, and external audits of our cybersecurity program. We also leverage assessors, consultants, auditors and third-party service providers to inform our understanding of the cybersecurity threat landscape and enable risk-based measures to defend against evolving threats. Additionally, we maintain cybersecurity insurance to mitigate costs that may be associated with a cybersecurity incident.

Incident Response

We have a Cybersecurity Incident Response Plan (“CSIRP”) to provide the organizational and operational structure, processes, and procedures for investigating, containing, documenting and mitigating cybersecurity incidents, including keeping senior management and other key stakeholders informed and involved as appropriate.

Our Cybersecurity Incident Response Team manages and executes technical response activities in coordination with our Security Operations Center, subject matter experts and others to respond to a cybersecurity incident. The objectives of the CSIRP include to:

• Establish the Company’s cybersecurity incident response process and provide actionable guidelines to provide a timely, consistent, and repeatable response process;
• Develop governance and roles, as well as escalation paths;
• Describe the requirements and expectations for cybersecurity incident response;
• Set forth the roles and responsibilities for cybersecurity incident response personnel;
• Establish cybersecurity incident classification, escalation, and prioritization parameters;
• Confirm the documentation process for cybersecurity incidents affecting the Company and the Company’s responses are appropriately documented;
• Establish protocols for materiality determinations for cybersecurity incidents under the SEC’s cybersecurity rules;
• Establish the process for assessing when public disclosure and external communications may be required; and
• Mitigate or minimize the effects of a cybersecurity incident on the Company, its personnel, customers, consumers, or others and limit financial, operational, legal, and reputational impact.

Material Cybersecurity Risks, Threats & Incidents

We also rely on information technology and third-party vendors to support our operations, including our secure processing of personal, confidential, sensitive, proprietary and other types of information. Despite ongoing efforts to continuously improve our and our vendors’ ability to protect against cyber incidents, we may not be able to protect all information systems, and such incidents may lead to reputational harm, revenue and client loss, legal actions, statutory penalties, among other consequences. We have not experienced a known material information security breach of our systems nor incurred material breach-related expenses over the last three years; however, there can be no guarantee that we will not be the subject of future cybersecurity threats or incidents. Additional information on cybersecurity risks we face can be found in Item 1A, Risk Factors, which should be read in conjunction with the foregoing information.

On December 31, 2025, we had approximately 145 manufacturing and processing facilities in 49 countries and 101 principal distribution centers and warehouses worldwide that we owned or leased. In addition to our owned or leased properties, we also utilize a highly distributed network of warehouses and distribution centers that are owned or leased by third party logistics partners, contract manufacturers, co-packers or other strategic partners. We believe we have or will add sufficient capacity to meet our planned operating needs. It is our practice to maintain all of our plants and other facilities in good condition.

(1) Excludes our deconsolidated Venezuela operations. Refer to Note 1, Summary of Significant Accounting Policies, for more information.

Information regarding legal proceedings is available in Note 11, Commitments and Contingencies, to the consolidated financial statements in this report.

The following discussion and analysis contains forward-looking statements. It should be read in conjunction with the other sections of this Annual Report on Form 10-K, including the consolidated financial statements and related notes contained in Forward-Looking Statements and Item 1A, Risk Factors.

For a discussion of the fiscal year ended December 31, 2024 compared to the fiscal year ended December 31, 2023, please refer to Part II, Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Overview of Business and Strategy

Our core business is making and selling chocolate, biscuits and baked snacks, with additional businesses in adjacent, locally relevant categories including gum & candy, cheese & grocery and powdered beverages around the world.

We aim to be the global leader in snacking. Our strategy is to drive long-term growth by focusing on four strategic priorities: accelerating consumer-centric growth, driving operational excellence, creating a winning growth culture and scaling sustainable snacking. We believe the successful implementation of our strategic priorities and leveraging of our attractive global footprint, strong core of iconic global and local brands, marketing, sales, distribution and cost excellence capabilities, and top talent with a growth mindset, will drive consistent top- and bottom-line growth, enabling us to continue to create long-term value for our shareholders.

For more detailed information on our business and strategy, refer to Item 1, Business.

Recent Developments and Significant Items

Macroeconomic environment

We continue to observe significant market and geopolitical uncertainty, fluctuating consumer demand, inflationary pressures, supply constraints, trade and regulatory uncertainty and exchange rate volatility. As a result, we experienced significantly higher operating costs, including higher overall raw material, labor and energy costs that have continued to rise. In particular, while we expect cocoa costs to be lower in 2026 compared to the current year, we expect to continue to face elevated cocoa costs as compared to historical levels in the near- and medium-term. Refer to Commodity Trends for additional information.

Our overall outlook for future snacks revenue growth remains strong; however, we anticipate ongoing volatility. While we have responded to elevated raw material costs with pricing increases for certain of our products, the elasticity impacts from those pricing increases has adversely impacted consumer demand, particularly in the United States and Europe. We will continue to proactively manage our business in response to the evolving global economic environment, related uncertainty and business risks while also prioritizing and supporting our employees and customers. We continue to take steps to mitigate impacts to our supply chain, operations, technology and assets.

Trade and Regulatory Uncertainty

In many markets, including the United States, a portion of our products, including significant inputs, are imported from other jurisdictions. As of January 2026, the U.S. maintains higher tariffs on imported goods (finished products and inputs) from many trading partners as compared to prior years. Some of these tariffs have increased our costs for finished products, as well as some ingredients and packaging used to produce and distribute our products. In some cases, U.S. tariff policy has also resulted in retaliatory measures on U.S. goods entering foreign markets. For most products and materials imported to the United States from Mexico and Canada, we comply with the terms of the U.S.-Mexico-Canada Agreement and are therefore not subject to tariffs on most products and materials imported from those jurisdictions. However, the current trade environment continues to evolve rapidly and there can be no assurance that such products and materials will continue to be exempt. The implementation of additional protectionist trade measures, and any further retaliatory actions taken in response, could result in increased costs and pricing pressures, disrupt consumer spending patterns, and impact market stability and consumer confidence, any or all of which could adversely affect our operating results.

Additionally, we provide more information on risks related to trade and regulatory uncertainty in our Business Trends section and under Item 1A, Risk Factors.

War in Ukraine

In February 2022, following the Russian military invasion of Ukraine, we stopped production and closed our facilities in Ukraine; since then we have taken steps to protect the safety of our employees and to restore operations at our two manufacturing facilities, which were significantly damaged in March 2022. Refer to Items Affecting Comparability of Financial Results for additional information.

We have suspended new capital investments and our advertising spending in Russia, but as a food company with more than 2,500 employees in the country, we have not ceased operations because we believe that we play a role in the continuity of the food supply. We continue to evaluate the situation in Ukraine and Russia and our ability to control our operating activities and businesses on an ongoing basis and comply with applicable international sanctions. We continue to consolidate both our Ukrainian and Russian subsidiaries. During 2025, Ukraine generated 0.4% and Russia generated 3.7% of our consolidated net revenue. The profitability of and the assets held by our Russian business continue to remain above historic levels. We cannot predict if the recent strength in our Russian business will continue in the future.

Our operations in Russia are subject to risks, including the temporary or permanent loss of assets due to expropriation or further curtailment of our ability to conduct business operations in Russia. In the event this were to occur, this could lead to the partial or full impairment of our Russian assets or deconsolidation of the operations in Russia in future periods, or the termination of and loss of revenue from our business operations, based on actions taken by Russia, other parties or us. For additional information, refer to Item 1A, Risk Factors, including the risk entitled “The war in Ukraine has impacted and could continue to impact our business operations, financial performance and results of operations.”

Developments in the Middle East

In October 2023, conflict developed in the Middle East between Hamas and Israel, and has expanded to other parts of the region. Throughout 2024 and 2025, we experienced limited adverse sales impacts related to this conflict in certain AMEA markets, but this did not have a material impact on our business, results of operations or financial condition. We continue to evaluate the impacts of these developments, including ongoing geopolitical discussions, on our business and we cannot predict if it will have a significant impact in the future.

Extreme Price Growth in Argentina and Other Currency-Related Items

During December 2023, the Argentinean peso significantly devalued. The peso's devaluation and potential resulting distortion on our non-GAAP Organic Net Revenue, Organic Net Revenue growth and other constant currency growth rate measures resulted in our decision to exclude the impact of pricing increases in excess of 26% year-over-year ("extreme pricing") in Argentina, from these measures beginning in the first quarter of 2024. The benchmark of 26% represents the minimum annual inflation rate for each year over a 3-year period which would result in a cumulative inflation rate in excess of 100%, the level at which an economy is considered hyperinflationary under U.S. GAAP. Throughout the following MD&A discussion, we exclude the impact of extreme pricing in Argentina from the net pricing impact of Organic Net Revenue and Organic Net Revenue growth and its related impact on our other non-GAAP financial constant currency growth measures. Additionally within this MD&A discussion, "currency-related items" reflect the impacts of extreme pricing and year-over-year currency translation rate changes. Refer to Non-GAAP financial measures for additional information.

Currency-related items impacted our non-GAAP financial measures for the year ended December 31, 2025 as follows:

• Organic Net Revenue: In total, favorable currency-related items of $241 million (0.7 pp) were driven by favorable currency translation rate changes of $192 million (0.6 pp) and extreme pricing of $49 million (0.1 pp). In Emerging Markets, unfavorable currency-related items of $134 million (0.9 pp) were driven by unfavorable currency translation rate changes of $183 million (1.3 pp), partially offset by extreme pricing of $49 million (0.4 pp). In Developed Markets, favorable currency-related items of $375 million (1.7 pp) were driven by favorable currency translation rate changes.
• Adjusted Operating Income: Favorable currency-related items of $94 million were driven by favorable currency translation rate changes of $86 million and extreme pricing of $8 million.
• Adjusted EPS: In 2025, favorable currency-related items of $0.06 were driven by favorable currency translation rate changes of $0.05 and extreme pricing of $0.01.

ERP System Implementation

In July 2024, our Board of Directors approved funding of $1.2 billion for a multi-year systems transformation program to upgrade our global ERP and supply chain systems (the “ERP System Implementation”). ERP System Implementation spending comprises both capital expenditures and operating expenses, of which a majority is expected to relate to operating expenses. The operating expenses associated with the ERP System Implementation represent incremental transformational costs above the normal ongoing level of spending on information technology to support operations. The ERP System Implementation program will be implemented by region in several phases with spending continuing over the next three years, with expected completion by year-end 2028. Refer to Non-GAAP financial measures for additional information.

Acquisitions and Divestitures

During 2024, we completed the acquisition of Evirth (Shanghai) Industrial Co., Ltd. (“Evirth”), a leading manufacturer of cakes and pastries in China. Refer to Note 2, Acquisitions and Divestitures for additional details.

Equity Method Investment Transactions

JDE Peet’s Transactions (Euronext Amsterdam: “JDEP”)

On August 24, 2025, Keurig Dr Pepper Inc. (Nasdaq: "KDP") and JDEP entered into a definitive agreement under which KDP would acquire JDEP. As a result of that definitive agreement, we became entitled to a cash payment of €145 million ($169 million) from JAB Holding Company (“JAB”) that we received in 2025.

In the first quarter of 2024, we recorded an impairment charge of €612 million ($665 million) related to our JDEP investment. In the fourth quarter of 2024, we sold our remaining 85.9 million shares in JDEP to JAB. We received €2.2 billion ($2.3 billion) of proceeds and recorded a gain on equity method investment transactions of €313 million ($332 million).

In 2023, we sold approximately 9.9 million of our shares, which reduced our ownership interest by 2.0 percentage points, from 19.7% to 17.7%. We received cash proceeds of €255 million ($279 million) and recorded a loss of €21 million ($23 million).

Keurig Dr Pepper Transactions

During the first quarter of 2023, our ownership in KDP fell to below 5% of the outstanding shares, resulting in a change in the accounting for our KDP investment, from equity method investment accounting to accounting for equity interests with readily determinable fair values as we no longer retained significant influence. Prior to the change in accounting for our KDP investment, we sold 30 million shares of that investment. Subsequently in 2023, we sold the remainder of our shares of KDP and exited our investment in the company. In total during 2023, we sold approximately 76 million shares and received proceeds of $2.4 billion.

For additional information, refer to Note 7, Investments and Note 9, Financial Instruments.

Mondelēz Global and Canada Retirement Plan Settlements

Mondelēz Global LLC Retirement Plan Settlement

During 2024, we entered into agreements with two third-party insurance companies to purchase buy-in annuity contracts to cover the liabilities associated with the Mondelēz Global LLC Retirement Plan (“MDLZ Global Plan”), the pension plan for U.S. salaried employees. The agreements provided us with the option to elect a buy-out conversion, at which time full responsibility of the MDLZ Global Plan obligations would transfer to the insurance companies. On June 12, 2025 we elected the buy-out conversion and recognized a non-cash pre-tax settlement loss of $282 million as a component of our net periodic pension cost in the second quarter of 2025.

Mondelez Canada Inc. - Trusteed Hourly Retirement Plan and Retirement Plan Settlement

During the third quarter of 2025, we entered into an agreement with a third-party insurance company to buy-out the retiree participants' obligations of the Mondelez Canada Inc. Trusteed Hourly Retirement Plan and Mondelez Canada Inc. Retirement Plan. On September 11, 2025, the obligations were transferred to the insurance company and we recognized a non-cash pre-tax settlement loss of $54 million as a component of our net periodic pension cost in the third quarter of 2025.

For additional information, refer to Note 10, Benefit Plans.

Taxes

We continue to monitor existing and potential future tax reform around the world. Numerous countries have enacted the Organization of Economic Cooperation and Development’s (OECD) model rules for a global minimum tax, effective in 2024. The existing legislation does not have a material impact on our consolidated financial statements. On January 5, 2026, the OECD Inclusive Framework members approved changes to the model rules, including the introduction of a “side by side” rule which would exempt U.S.-parented companies from certain aspects of the global minimum tax regime. The updated model rules will need to be incorporated into local tax legislation to be effective. We do not expect the new rules to have a material impact on our consolidated financial statements.

On July 4, 2025, the OBBBA was signed into U.S. law. While we continue to monitor supplemental guidance released by the government, there was no material impact to our financial statements for the year ended December 31, 2025.

Business Trends

We monitor a number of developments and trends that could impact our revenue and profitability objectives:

Demand

We monitor consumer spending and our market share within the food and beverage categories in which we sell our products. Core snacks categories continued to expand due to the continued growth of snacking as a consumer behavior around the world. As part of our strategic plan, we seek to drive category growth by leveraging our local and consumer-focused commercial approach, making investments in our brand and snacks portfolio, building strong routes to market in both emerging and developed markets and improving our availability across multiple channels. We believe these actions will continue to help drive demand in our categories and strengthen our positions across markets.

Long-Term Demographics and Consumer Trends

Snack food consumption is highly correlated to GDP growth, urbanization of populations and rising discretionary income levels associated with a growing middle class, particularly in emerging markets. We believe that snacks continue to be a source of comfort as well as excitement and variety for consumers. Social media increasingly helps consumers find food trends, inspiration and connection across their feeds. Consumers are also interested in buying snacks conveniently, whether through same-day delivery platforms, shipped sources or different retail settings. Many consumers also continue to prioritize sustainability in their purchase decisions, valuing sustainably sourced ingredients, low carbon footprint preparation and lower waste packaging. We seek to continue to offer snacks that meet consumer needs and preferences and align with our strategic priorities.

Pricing

Our net revenue growth and profitability may be affected as we adjust prices to address new conditions, such as increasing input and operating costs due to supply, transportation and labor constraints, the impact of tariffs and higher cost trends. We adjust our product prices based on a number of variables including market factors, transportation, logistics and changes in our product input costs, and we have increased prices to mitigate costs given significant cost inflation.

Operating Costs

Our operating costs include raw materials, labor, selling, general and administrative expenses, taxes, currency impacts and financing costs. We manage these costs through cost saving and productivity initiatives, sourcing and hedging programs, pricing actions, refinancing and other planning actions. We experienced significantly higher operating costs, including higher overall raw material (particularly cocoa) that have continued to rise. Refer to Commodity Trends for additional information.

Trade and Regulatory Uncertainty

In many markets, including the United States, a portion of our products, including significant inputs, are imported from other jurisdictions. As of January 2026, the U.S. maintains higher tariffs on imported goods (finished products and inputs) from many trading partners. Some of these tariffs have increased our costs for finished products, as well as some ingredients and packaging used to produce and distribute our products. In some cases, U.S. tariff policy has also resulted in retaliatory measures on U.S. goods entering foreign markets. For additional information, refer to Item 1A, Risk Factors, including the risk entitled “We are subject to risks from changes to the trade policies and tariff and import/export regulations by the U.S. and/or other foreign governments.”

Non-GAAP Financial Measures

We use non-GAAP financial measures internally to make operating and strategic decisions, including the preparation of our annual operating plan, evaluation of business performance and as a factor in determining incentive compensation. We believe that non-GAAP financial measures, when used in connection with results reported in accordance with U.S. GAAP, provide additional information to facilitate comparisons of our historical operating results and to enable a more comprehensive understanding of trends in our underlying operating results. We also believe that presenting these measures allows investors to view our performance using the same measures that management and our Board of Directors use in evaluating our business performance and trends. However, non-GAAP financial measures should be considered in addition to, and not as substitutes for, financial information prepared in accordance with U.S. GAAP. In addition, our non-GAAP financial measures may not be the same as or comparable to similar non-GAAP measures presented by other companies. A limitation of these non-GAAP financial measures is they exclude items that have an impact on our U.S. GAAP reported results. The best way this limitation can be addressed is by evaluating our non-GAAP financial measures in combination with our U.S. GAAP reported results. We have provided the reconciliations between the GAAP and non-GAAP financial measures along with a discussion of our underlying GAAP results throughout our Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Form 10-K.

We also evaluate the operating performance of the company and its international subsidiaries on a constant currency basis. Our non-GAAP measures presented on a constant currency basis exclude the effects of currency translation rate changes and, beginning in the first quarter of 2024, extreme pricing increases in Argentina. For additional information, refer to Extreme Price Growth in Argentina and Other Currency-Related Items. We determine constant currency operating results by dividing or multiplying, as appropriate, the current-period local currency operating results by the currency exchange rates used to translate the financial statements in the comparable prior-year period to determine what the current-period U.S. dollar operating results would have been if the currency exchange rate had not changed from the comparable prior-year period.

Our primary non-GAAP financial measures and corresponding metrics, listed below, reflect how we evaluate our current and prior year operating results. As new events or circumstances arise, these definitions could change. When our definitions change, we provide the updated definitions and present the related non-GAAP historical results on a comparable basis. When items no longer impact our current or future presentation of non-GAAP operating results, we remove these items from our non-GAAP definitions. For descriptions of the items excluded from our non-GAAP financial measures, refer to Items Affecting Comparability of Financial Results.

• “Organic Net Revenue” is defined as net revenues (the most comparable U.S. GAAP financial measure) excluding, when they occur, the impacts of acquisitions, divestitures, short-term distributor agreements related to the sale of a business, and currency-related items. We believe that Organic net revenue reflects the underlying growth from the ongoing activities of our business and provides improved comparability of results. Organic Net Revenue growth is presented on a consolidated basis, for each of our segments and for our emerging markets and developed markets, and these underlying measures are also reconciled to the most comparable U.S. GAAP financial measures above.
• Our emerging markets include our Latin America region in its entirety; the AMEA region, excluding Australia, New Zealand and Japan; and the following countries from the Europe region: Russia, Ukraine, Türkiye, Kazakhstan, Georgia, Poland, Czech Republic, Slovak Republic, Hungary, Bulgaria, Romania, the Baltics and the East Adriatic countries.
• Our developed markets include the entire North America region, the Europe region excluding the countries included in the emerging markets definition, and Australia, New Zealand and Japan from the AMEA region.
• “Adjusted Operating Income” is defined as operating income (the most comparable U.S. GAAP financial measure) excluding, when they occur, the impacts of: restructuring charges; gains or losses (including non-cash impairment charges) on goodwill and intangible assets; divestiture-related items; acquisition-related items; operating results from short-term distributor agreements related to the sale of a business; remeasurement of net monetary position of highly inflationary countries; mark-to-market impacts from commodity and foreign currency derivative contracts economically hedging forecasted transactions; resolution of tax matters; incremental costs due to the war in Ukraine; the European Commission legal matter; pension participation changes; and operating costs from the ERP System Implementation program.

We also present Adjusted Operating Income margin, which is subject to the same adjustments as Adjusted Operating Income. We also evaluate growth in our Adjusted Operating Income on a constant currency basis. We believe these measures provide improved comparability of underlying operating results.

• “Adjusted EPS” is defined as diluted EPS attributable to Mondelēz International (the most comparable U.S. GAAP financial measure) from continuing operations excluding, when they occur, the impacts of the items listed in the Adjusted Operating Income definition as well as gains or losses on debt extinguishment and related expenses; gains or losses on marketable securities transactions; initial impacts from enacted tax law changes; and gains or losses on equity method investment transactions. We also evaluate growth in our Adjusted EPS on a constant currency basis. We believe Adjusted EPS provides improved comparability of underlying operating results.

Items Affecting Comparability of Financial Results

The below table and subsequent commentary present income or (expense) items that affected the comparability of our results of operations and provides details of each item. Please refer to the notes to the consolidated financial statements indicated below for additional information. These items are excluded from our non-GAAP earnings measures to better facilitate comparisons of our underlying operating performance across periods. Refer also to the Consolidated Results of Operations – Net Earnings and Earnings per Share Attributable to Mondelēz International table for the after-tax per share impacts of these items and to the Non-GAAP Financial Measures section for definitions of our non-GAAP financial measures.

(in millions, except percentages)

(1) Includes impacts recorded in operating income and interest expense and other, net in the consolidated statements of earnings.

Restructuring charges – Includes restructuring charges incurred under the Simplify to Grow Program as well as other subsequent restructuring actions starting in the fourth quarter of 2025. The Simplify to Grow program comprised charges such as severance, asset write-downs and other costs of implementing that program, partially offset by gains on sales of assets disposed of in connection with the program. We completed the Simplify to Grow Program in the fourth quarter of 2024. Following the completion of the program, any adjustments to the liabilities for previously recorded charges continue to be reflected within this item. Beginning in the fourth quarter of 2025, we started implementing new restructuring actions to reduce our cost structure and streamline our operations. The charges associated with these actions primarily relate to severance and other implementation costs.

Intangible asset impairment charges – Reflects non-cash impairments of certain of our brands in connection with our indefinite-life intangible asset impairment testing.

Mark-to-market impacts from derivatives – We exclude unrealized gains and losses (mark-to-market impacts) from commodity and foreign currency derivative contracts economically hedging forecasted transactions from our non-GAAP earnings measures. The mark-to-market impacts of those derivatives are excluded until the related gains or losses are realized. Since we purchase commodity and foreign currency derivative contracts to mitigate price volatility primarily for inventory requirements in future periods, we make this adjustment to remove the volatility of these future inventory purchases on current operating results to facilitate comparisons of our underlying operating performance across periods.

Acquisition-related items – Includes acquisition-related costs, acquisition integration costs, contingent consideration adjustments, inventory step-ups and gains from acquisitions. Acquisition-related costs include third-party advisor, investment banking and legal fees. Acquisition integration costs include costs related to the integration of operations from acquisitions. Contingent consideration adjustments include any changes made to contingent compensation liabilities for earn-outs related to acquisitions that do not relate to recurring employee compensation expense. Refer to Note 9, Financial Instruments - Fair Value of Contingent Consideration for additional information. Other acquisition-related items include incremental costs from inventory step-ups associated with acquired companies related to the fair market valuation of the acquired inventory and acquisition gains from the remeasurement of an existing noncontrolling investment to fair value when the company acquires a controlling interest in the investee.

Divestiture-related items – Includes operating results from divestitures, divestiture-related costs and gains/(losses) on divestitures. Divestitures may include sales of businesses, exits of major product lines upon completion of a sale or licensing agreement or sales of equity method investments. Divestiture-related costs include costs incurred in relation to the preparation and completion of divestiture transactions (including one-time costs such as severance related to the elimination of stranded costs) as well as costs incurred associated with publicly announced processes to sell businesses. For 2024, operating results from divestitures (which are not reflected in the table above) also include the operating results from the company’s JDE Peet’s equity method investment earnings which was sold in the fourth quarter of 2024.

Operating results from short-term distributor agreements – Reflects the operating results from short-term distributor agreements that have been executed in conjunction with the sale of a business. Our agreement with the buyer of the developed market gum business to distribute gum products in certain European markets ended in the first quarter of 2024.

Incremental costs due to war in Ukraine – In February 2022, Russia began a military invasion of Ukraine and we temporarily stopped our production and closed our manufacturing facilities in Trostyanets and Vyshhorod due to damage incurred during the conflict. In the second quarter of 2024, we fully resumed production at both facilities after completing targeted repairs. Incremental costs incurred by the company related to the ongoing war in Ukraine relate to asset write-downs, net of recoveries as well as other costs, including committed compensation.

European Commission legal matter – In November 2019, the European Commission informed us that it initiated an investigation into our alleged infringement of European Union competition law through certain practices allegedly restricting cross-border trade within the European Economic Area. We reached a negotiated resolution to this matter in the second quarter of 2024. We adjusted our accrual accordingly and fulfilled our payment obligation in August 2024. Due to the unique nature of this matter, we believe it to be infrequent and unusual and therefore exclude it from our non-GAAP earnings measures to better facilitate comparisons of our underlying operating performance across periods.

ERP System Implementation costs – In July 2024, our Board of Directors approved funding of $1.2 billion for a multi-year systems transformation program to upgrade our global ERP and supply chain systems, which is comprised of both capital expenditures and operating expenses, of which a majority is expected to be operating expenses. The ERP System Implementation program will be implemented by region in several phases with spending continuing over the next three years, with expected completion by year-end 2028. The operating expenses associated with the ERP System Implementation represent incremental transformational costs above the normal ongoing level of spending on information technology to support operations. These expenses include third-party consulting fees, direct labor costs associated with the program, accelerated depreciation of our existing SAP financial systems and various other expenses, all associated with the implementation of our information technology upgrades.

Remeasurement of net monetary position of highly inflationary countries – Our operations in Argentina, Türkiye, Egypt and Nigeria are currently accounted for as highly inflationary. We exclude remeasurement gains and losses of the monetary assets and liabilities of our subsidiaries in highly inflationary economies and the realized gains and losses from derivatives that mitigate the foreign currency volatility related to the remeasurement of the respective monetary assets or liabilities from our non-GAAP earnings measures to facilitate comparisons of our underlying operating performance across periods.

Pension participation changes – Consists of the charges incurred, primarily gains or losses from pension curtailments and settlements, including settlement losses from the full or partial buy-out of our pension plans, as well as costs incurred when employee groups are withdrawn from multiemployer pension plans. We exclude these charges from our non-GAAP results because those amounts do not reflect our ongoing pension obligations.

Resolution of tax matters – Consists of the reversals and settlements of unusual and significant indirect tax matters. Due to the unique nature of these resolutions, we believe it to be infrequent and therefore exclude it from our non-GAAP earnings measures to better facilitate comparisons of our underlying operating performance across periods.

Initial impacts from enacted tax law changes – Initial impacts from enacted tax law changes include items such as the remeasurement of deferred tax balances and transition taxes from tax reforms. We exclude initial impacts from enacted tax law changes from our non-GAAP financial measures as they do not reflect our ongoing tax obligations under the enacted tax law.

Gains and losses on marketable securities – We exclude gains and losses associated with the sale of our marketable securities. These marketable securities gains or losses are not indicative of underlying operations and are excluded to better facilitate comparisons of our underlying operating performance across periods.

Gains and losses on equity method investment transactions – We exclude gains and losses from partial or full sales of equity method investments, as well as impairments or other non-routine transactions related to those investments. In addition, we also exclude from our non-GAAP financial measures any gains or losses realized on economic hedges of sales proceeds from our equity method investment transactions.

Discussion and Analysis of Historical Results

Summary of Results

Net Revenues – Net revenues were approximately $38.5 billion in 2025 and $36.4 billion in 2024, an increase of 5.8% in 2025. Net revenues increased in 2025, driven by higher net pricing, incremental net revenue from our November 1, 2024 acquisition of Evirth and favorable currency-related items, as several currencies we operate in strengthened relative to the U.S. dollar compared to exchange rates in the prior year, partially offset by unfavorable volume/mix and lapping prior-year net revenue from a short-term distributor agreement related to the sale of our developed market gum business.

Organic Net Revenue – Organic Net Revenue, a non-GAAP financial measure, increased 4.3% to $37.9 billion in 2025 due to higher net pricing, partially offset by unfavorable volume/mix. Organic Net Revenue is reported on a constant currency basis and excludes revenue from acquisitions and divestitures. Refer to Non-GAAP Financial Measures for the definition of Organic Net Revenue and Consolidated Results of Operations for our reconciliation with net revenues.

Diluted EPS – Diluted EPS attributable to Mondelēz International decreased 44.7% to $1.89 in 2025. Diluted EPS decreased in 2025 driven by an unfavorable year-over-year change in mark-to-market impacts from commodity and foreign currency derivatives, a decrease in Adjusted EPS, settlement losses related to pension plan buy-outs, an unfavorable year-over-year change in acquisition-related items, lapping prior-year divestiture-related items and higher costs incurred for the ERP System Implementation program. These unfavorable items were partially offset by lapping a prior-year equity method investment impairment, a current year gain on an equity method investment transaction, lapping prior-year costs for the completed Simplify to Grow Program, lower intangible asset impairment charges and a favorable impact from the resolution of an indirect tax matter.

Adjusted EPS – Adjusted EPS, a non-GAAP financial measure, decreased 12.8% to $2.92 in 2025. On a constant currency basis, Adjusted EPS decreased 14.6% to $2.86 in 2025. Refer to Non-GAAP Financial Measures for the definition of Adjusted EPS and Consolidated Results of Operations for our reconciliation with diluted EPS. Adjusted EPS decreased in 2025, driven by operating declines, higher interest and other expense, higher income taxes and lower benefit plan non-service income, partially offset by fewer shares outstanding, favorable currency-related items and the impact from an acquisition.

Consolidated Results of Operations

The following discussion compares our consolidated results of operations for 2025 with 2024.

(in millions, except per share data)

Net Revenues – Net revenues increased $2,096 million (5.8%) to $38,537 million in 2025, and Organic Net Revenue increased $1,571 million (4.3%) to $37,946 million (1). Emerging markets net revenues increased 8.5% and emerging markets Organic Net Revenue increased 7.2% (1). Developed markets net revenues increased 4.0% and developed markets Organic Net Revenue increased 2.5% (1). The underlying changes in net revenues and Organic Net Revenue are detailed below:

(1) Please refer to the Non-GAAP Financial Measures section for additional information.

The net revenue increase of 5.8% was driven by our underlying Organic Net Revenue growth of 4.3%, the impact of an acquisition and favorable currency-related items, partially offset by lapping prior-year net revenue from a short-term distributor agreement related to the sale of our developed market gum business. Organic Net Revenue growth was driven by higher net pricing, partially offset by unfavorable volume/mix. Higher net pricing was due to the benefit of carryover pricing from 2024 as well as the effects of input cost-driven pricing actions taken during 2025. Higher net pricing was reflected in all regions. Unfavorable volume/mix was experienced across all regions, driven by volume declines reflecting pricing elasticity impacts in Europe, Latin America and AMEA, as well as soft biscuits & baked snacks consumption in North America. The November 1, 2024 acquisition of Evirth added incremental net revenues of $316 million (constant currency basis) through the one-year anniversary of the acquisition. Refer to Note 2, Acquisitions and Divestitures, for additional information. Currency-related items increased net revenues by $241 million, driven by favorable currency translation rate changes and the impact of extreme pricing in Argentina. Refer to Recent Developments and Significant Items Affecting Comparability for additional information. Favorable currency translation rate changes were due to the strength of several currencies relative to the U.S. dollar, including the euro, Russian ruble, British pound sterling, Polish zloty and Swedish krona, partially offset by the strength of the U.S. dollar relative to several currencies, primarily the Argentinean peso, Brazilian real, Mexican peso, Indian rupee, Turkish lira, Australian dollar, Egyptian pound and Canadian dollar. The lapping of the prior-year short-term distributor agreement related to the sale of our developed market gum business, which ended in the first quarter of 2024, resulted in a year-over-year incremental reduction in net revenue of $25 million.

Operating Income – Operating income decreased $2,797 million (44.1%) to $3,548 million in 2025, Adjusted Operating Income (1) decreased $822 million (13.9%) to $5,074 million and Adjusted Operating Income on a constant currency basis decreased $916 million (15.5%) to $4,980 million due to the following:

(in millions)

(1) Refer to the Non-GAAP Financial Measures section for additional information.

During 2025, we realized higher net pricing, which was more than offset by increased input costs and unfavorable volume/mix. Higher net pricing, which included the carryover impact of pricing actions taken in 2024 as well as the effects of input cost-driven pricing actions taken during 2025, was reflected across all regions. The increase in input costs was driven by higher raw material costs, partially offset by lower manufacturing costs driven by productivity. Higher raw material costs were primarily due to higher cocoa, dairy, packaging, edible oils, nuts and other ingredient costs, as well as unfavorable year-over-year currency exchange transaction costs on imported materials, partially offset by lower sugar, grains and energy costs. Overall, unfavorable volume/mix was experienced across all regions, reflecting pricing elasticity impacts as well as biscuit & baked snacks category softness in North America.

Total selling, general and administrative expenses decreased $266 million from 2024, which was net of several unfavorable factors noted in the table above, including in part, an unfavorable year-over-year change in acquisition-related items, higher costs incurred for the ERP System Implementation program, incremental overhead expenses from the acquisition of Evirth and unfavorable currency-related impacts to expenses, which were partially offset by benefits from lapping prior-year implementation costs for the completed Simplify to Grow Program, a favorable resolution of an indirect tax matter and a favorable year-over-year change in divestiture-related items. Excluding these net unfavorable factors, selling, general and administrative expenses decreased $620 million from 2024. The decrease was driven primarily by lower advertising and consumer promotion costs and lower overhead costs.

Currency-related items, due to favorable currency translation rate changes and the impact of extreme pricing in Argentina increased operating income by $94 million. Favorable currency translation rate changes were primarily due to the strength of several currencies relative to the U.S. dollar, including the euro, Russian ruble and British pound sterling, partially offset by the strength of the U.S. dollar relative to several currencies, including the Swiss franc, Mexican peso, Brazilian real, Australian dollar and Indian rupee.

Operating income margin decreased from 17.4% in 2024 to 9.2% in 2025. The decrease in operating income margin was driven primarily by an unfavorable year-over-year change in mark-to-market impacts from commodity and foreign currency derivatives, lower Adjusted Operating Income margin, an unfavorable year-over-year change in acquisition-related items and higher costs incurred for the ERP System Implementation program, partially offset by lower restructuring charges and lower intangible asset impairment charges. Adjusted Operating Income margin decreased from 16.2% in 2024 to 13.2% in 2025. The decrease was driven primarily by higher raw material costs and unfavorable product mix, partially offset by higher net pricing, lower advertising and consumer promotion costs, lower manufacturing costs driven by productivity and lower overhead costs.

Income Taxes - Our 2025 effective tax rate was 25.9%, as compared to 23.5% in 2024. The increase was due to the net unfavorable impacts of our jurisdictional mix of pretax income, foreign provisions under U.S. tax laws and a net increase to valuation allowances. This was partially offset by favorable tax benefits related to audit settlements, final 2024 tax return filings and the tax treatment of certain foreign pension assets.

Net Earnings and Earnings per Share Attributable to Mondelēz International – Net earnings attributable to Mondelēz International of $2,451 million decreased by $2,160 million (46.8%) in 2025. Diluted EPS attributable to Mondelēz International was $1.89 in 2025, down $1.53 (44.7%) from 2024. Adjusted EPS was $2.92 in 2025, down $0.43 (12.8%) from 2024 (1). Adjusted EPS on a constant currency basis was $2.86 in 2025, down $0.49 (14.6%) from 2024.

(1) Refer to the Non-GAAP Financial Measures section for additional information. The tax expense/(benefit) of each of the pre-tax items excluded from our GAAP results was computed based on the facts and tax assumptions associated with each item, and such impacts have also been excluded from Adjusted EPS.

• 2025 taxes for the: Intangible asset impairment charges were $(5) million, mark-to-market losses from derivatives were $(261) million, acquisition-related items were $22 million, ERP System Implementation costs were $(39) million, remeasurement of net monetary position were zero, pension participation changes were $(87) million, resolution of tax matters were $10 million, initial impacts from enacted tax law changes were $13 million, gain on marketable securities were $(21) million and gain on equity method investment transactions were zero.
• 2024 taxes for the: Restructuring charges were $(36) million, intangible asset impairment charges were $(40) million, mark-to-market gains from derivatives were $107 million, acquisition-related items were $88 million, divestiture-related items were $1 million, ERP System implementation costs were $(19) million, remeasurement of net monetary position were zero, pension participation changes were $(3) million, initial impacts from enacted tax law changes were $24 million and loss on equity method investment transactions were $4 million.

Results of Operations by Operating Segment

Our operations and management structure are organized into four operating segments which are also our reportable segments:

• Latin America
• AMEA
• Europe
• North America

We manage our operations by region to leverage regional operating scale, manage different and changing business environments more effectively and pursue growth opportunities as they arise across our key markets. Our regional management teams have responsibility for the business, product categories and financial results in the regions. Refer to Note 18, Segment Reporting, for additional information on our segments and Items Affecting Comparability of Financial Results earlier in this section for items affecting our segment operating results.

Our segment net revenues and operating earnings were:

(in millions)

46

Latin America

(in millions)

Net revenues decreased $27 million (0.5%), due to unfavorable impact of currency-related items (5.1 pp) and unfavorable volume/mix (3.2 pp), partially offset by higher net pricing (7.8 pp). Currency-related items were unfavorable due to currency translation rate changes, partially offset by the impact of extreme pricing in Argentina. Unfavorable currency translation impacts were primarily due to the strength of the U.S. dollar relative to most currencies in the region, including the Argentinean peso, Brazilian real and Mexican peso. Unfavorable volume/mix reflected volume declines due to pricing elasticity impacts across most markets, primarily in Argentina and Brazil. Overall, unfavorable volume/mix was driven by declines in refreshment beverages, biscuits & baked snacks, candy and cheese & grocery, partially offset by gains in chocolate and gum. Higher net pricing, net of extreme pricing in Argentina, was driven by input cost-driven pricing actions, primarily in Brazil, Argentina and Mexico, and was reflected across all categories.

Segment operating income increased $37 million (7.0%), primarily due to higher pricing, lower manufacturing costs driven by productivity, lower advertising and consumer promotion costs, lower restructuring charges, favorable resolution of an indirect tax matter, lower acquisition-related items and lower losses on remeasurement of net monetary position in highly inflationary countries. These favorable items were partially offset by higher raw materials, unfavorable volume/mix, higher costs incurred for the ERP System Implementation program and higher other selling, general and administrative expenses.

AMEA

(in millions)

Net revenues increased $636 million (8.7%), due to higher net pricing (7.8 pp) and the impact of an acquisition (4.3 pp), partially offset by unfavorable volume/mix (2.1 pp) and unfavorable currency translation rate changes (1.3 pp). Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories. The November 1, 2024 acquisition of Evirth added incremental net revenues of $316 million (constant currency basis) through the one-year anniversary of the acquisition. Unfavorable volume/mix reflected pricing elasticity impacts, driven by declines in chocolate and refreshment beverages, partially offset by gains in cheese & grocery, candy, biscuits & baked snacks and gum. Unfavorable currency translation impacts were due to the strength of the U.S. dollar relative to most currencies in the region, including the Indian rupee, Australian dollar, Egyptian pound and Vietnamese dong, partially offset by the strength of a few currencies relative to the U.S. dollar, including the Malaysian ringgit and South African rand.

Segment operating income decreased $207 million (17.4%), primarily due to higher raw material costs, unfavorable volume/mix, higher acquisition-related items, unfavorable currency translation rate changes, higher intangible asset impairment costs and higher losses on remeasurement of net monetary position in highly inflationary countries. These unfavorable items were partially offset by higher net pricing, lower manufacturing costs driven by productivity, lower advertising and consumer promotion costs, the impact from our Evirth acquisition, lower other selling, general and administrative expenses, lower fixed asset impairments, lower restructuring charges and lower costs incurred for the ERP System Implementation program.

Europe

(in millions)

Net revenues increased $1,718 million (12.9%), due to higher net pricing (13.9 pp) and favorable currency translation rate changes (4.5 pp), partially offset by unfavorable volume/mix (5.3 pp), and lapping the prior-year net revenue from a short-term distributor agreement (0.2 pp). Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories. Favorable currency translation rate changes reflected the strength of most currencies across the region relative to the U.S. dollar, primarily the euro, Russian ruble, British pound sterling, Polish zloty and Swedish krona, partially offset by the strength of the U.S. dollar relative to a few currencies, primarily the Turkish lira,. Unfavorable volume/mix reflected volume declines due to pricing elasticity impacts. Overall, unfavorable volume/mix was driven by declines in chocolate, candy and gum, partially offset by gains in biscuits & baked snacks, cheese & grocery and refreshment beverages. The lapping of the prior-year short-term distributor agreement related to the sale of our developed market gum business, which ended in the first quarter of 2024, resulted in a year-over-year incremental reduction in net revenue of $25 million.

Segment operating income decreased $248 million (12.0%), primarily due to higher raw material costs, unfavorable volume/mix, higher other selling, general and administrative expenses and higher losses from remeasurement of net monetary position in highly inflationary countries. These unfavorable items were partially offset by higher net pricing, lower advertising and consumer promotion costs, lower intangible asset impairment charges, favorable currency translation rate changes, lower manufacturing costs driven by productivity, lower restructuring charges, lower acquisition-related items, a benefit in divestiture-related items and lower fixed asset impairment charges.

North America

(in millions)

Net revenues decreased $231 million (2.1%), due to unfavorable volume/mix (2.7 pp) and unfavorable currency translation rate changes (0.2 pp), partially offset by higher pricing (0.8 pp). Unfavorable volume/mix was driven by declines in biscuits & baked snacks and candy, primarily due to soft consumption in the U.S., partially offset by a gain in chocolate. Unfavorable currency translation rate changes were due to the strength of the U.S. dollar relative to the Canadian dollar. Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories.

Segment operating income decreased $588 million (23.6%), primarily due to higher raw material costs, unfavorable volume/mix, unfavorable acquisition-related items reflecting a lower year-over-year benefit from contingent consideration adjustments related to Clif Bar, net of lower acquisition integration costs, and higher costs incurred for the ERP System Implementation program. These unfavorable items were partially offset by lower advertising and consumer promotion costs, lower manufacturing costs due to productivity, higher net pricing, lower other selling, general and administrative expenses, lower restructuring charges and lower fixed asset impairment charges.

Liquidity and Capital Resources

We believe that cash from operations, our revolving credit facilities, short-term borrowings and long-term debt financing will continue to provide sufficient liquidity for our working capital needs, planned capital expenditures and future payments of our contractual, tax and benefit plan obligations and payments for acquisitions, share repurchases and quarterly dividends. We expect to continue to utilize our commercial paper program and international credit lines as needed. We continually evaluate long-term debt issuances to meet our short- and longer-term funding requirements. We also use intercompany loans with our international subsidiaries to improve financial flexibility. Overall, we do not expect negative effects to our funding sources that would have a material effect on our liquidity, and we continue to monitor our global operations including the impact of developments in Ukraine and the Middle East. To date, we have been successful in generating cash and raising financing as needed. However, if a serious economic or credit market crisis ensues or other adverse developments arise, it could have a material adverse effect on our liquidity, results of operations and financial condition.

Our most significant ongoing short-term cash requirements relate primarily to funding operations (including expenditures for raw materials, labor, manufacturing and distribution, trade and promotions, advertising and marketing, tax liabilities, benefit plan obligations and lease expenses) as well as periodic expenditures for acquisitions, shareholder returns (such as dividend payments and share repurchases), property, plant and equipment and any significant one-time non-operating items.

Long-term cash requirements primarily relate to funding long-term debt repayments (refer to Note 8, Debt and Borrowing Arrangements), deferred taxes (refer to Note 16, Income Taxes), long-term benefit plan obligations (refer to Note 10, Benefit Plans) and commodity-related purchase commitments and derivative contracts (refer to Note 9, Financial Instruments).

We generally fund short- and long-term cash requirements with cash from operating activities as well as cash proceeds from short- and long-term debt financing (refer to Debt below). We generally do not use equity to fund our ongoing obligations.

Cash Flow

We believe our ability to generate substantial cash from operating activities and readily access capital markets and secure financing at competitive rates are key strengths and give us significant flexibility to meet our short and long-term financial commitments. Our cash flow activity over the last three years is noted below:

(in millions)

Net Cash Provided by Operating Activities

The reduction in net cash provided by operating activities in 2025 was primarily due to a lower cash-basis net earnings combined with slightly unfavorable year-over-year working capital movements.

Net Cash Provided by/(Used In) Investing Activities

The reduction in net cash provided by/(used in) investing activities was largely driven by lapping prior year proceeds from the JDEP share sale combined with net payments for derivative settlements in the current year as compared to net proceeds from derivative settlements in the prior year. This was partially offset by net proceeds in investments in the current year as compared to net contributions in the prior year, lapping prior year cash consideration paid for the Evirth acquisition and lower capital expenditures as compared to the prior year. Refer to Note 2, Acquisitions and Divestitures and Note 7, Investments for more information.

Capital expenditures were $1,279 million in 2025, $1,387 million in 2024 and $1,112 million in 2023. We continue to make capital expenditures primarily to modernize manufacturing facilities and support new product and productivity initiatives. We expect 2026 capital expenditures to be up to $1.5 billion, including capital expenditures in connection with our ERP System Implementation program and for funding our strategic priorities. We expect to continue to fund these expenditures with cash from operations.

Net Cash Used in Financing Activities

The reduction in net cash used in financing activities was primarily due to higher debt proceeds combined with lower debt repayments, partially offset by an increase in dividends paid to shareholders in 2025 and higher share repurchases compared to prior year.

Dividends

We paid dividends of $2,487 million in 2025, $2,349 million in 2024 and $2,160 million in 2023. On July 29, 2025, the Audit Committee, with authorization delegated from our Board of Directors, declared a quarterly cash dividend of $0.50 per share of Class A Common Stock, an increase of 6 percent, which would be $2.00 per common share on an annualized basis. The declaration of dividends is subject to the discretion of our Board of Directors and depends on various factors, including our net earnings, financial condition, cash requirements, future prospects and other factors that our Board of Directors deems relevant to its analysis and decision making.

For U.S. income tax purposes only, the Company has determined that 100% of the distributions paid to its shareholders in 2025 are characterized as a qualified dividend paid from U.S. earnings and profits. Refer to Note 12, Capital Stock, to the consolidated financial statements and Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities – Issuer Purchases of Equity Securities, for information on our share repurchase program.

Guarantees

As discussed in Note 11, Commitments and Contingencies, we enter into third-party guarantees primarily to cover the long-term obligations of our vendors. As part of these transactions, we guarantee that third parties will make contractual payments or achieve performance measures. As of December 31, 2025 and December 31, 2024, we had no material third-party guarantees recorded on our consolidated balance sheets. Guarantees do not have, and we do not expect them to have, a material effect on our liquidity.

Debt

The nature and amount of our long-term and short-term debt and the proportionate amount of each varies as a result of current and expected business requirements, market conditions and other factors. As such, we may issue commercial paper or secure other forms of financing throughout the year to meet short-term working capital or other financing needs.

At our December 2025 meeting, the Board of Directors approved a new $4 billion long-term financing authorization that replaced the prior long-term financing authorization of $4 billion. As of December 31, 2025, $4.0 billion of the long-term financing authorization remained available.

Our total debt was $21.2 billion at December 31, 2025 and $17.7 billion at December 31, 2024. Our debt-to-capitalization ratio was 0.45 at December 31, 2025 and 0.40 at December 31, 2024. The weighted-average term of our outstanding long-term debt was 7.3 years at December 31, 2025 and 7.7 years at December 31, 2024. Our average daily commercial paper borrowings were $2.4 billion in 2025, $1.1 billion in 2024 and $2.1 billion in 2023.

One of our subsidiaries, Mondelez International Holdings Netherlands B.V. (“MIHN”), has outstanding debt. Refer to Note 8, Debt and Borrowing Arrangements. The operations held by MIHN generated approximately 75.1% (or $28.9 billion) of the $38.5 billion of consolidated net revenue during fiscal year 2025 and represented approximately 96.5% (or $25.0 billion) of the $25.9 billion of net assets as of December 31, 2025.

Refer to Note 8, Debt and Borrowing Arrangements, for more information on our debt and debt covenants.

Commodity Trends

We regularly monitor worldwide supply, commodity cost and currency trends so we can cost-effectively secure ingredients, packaging and fuel required for production. During 2025, the primary drivers of the increase in our aggregate commodity costs were higher cocoa, dairy, packaging, edible oils, nuts and other ingredient costs, as well as unfavorable year-over-year currency exchange transaction costs on imported materials, partially offset by lower sugar, grains and energy costs. While the costs of our principal raw materials fluctuate, generally we believe there will continue to be an adequate supply of the raw materials we use and that they will broadly remain available.

A number of external factors such as the current macroeconomic environment, including global inflation, effects of geopolitical uncertainty, climate, weather and other conditions affecting plant health and crop yield, commodity, transportation and labor market conditions, exchange rate volatility and the effects of global and local regulations, including trade policies, governmental agricultural or other programs affect the availability and cost of raw materials and agricultural materials used in our products. In particular, the supply of cocoa is exposed to many of these factors, including climate change, weather and other events affecting plant health and crop yield, local regulations in cocoa-producing countries, and global regulations such as the EU Deforestation Regulation (which requires companies to ensure that the products they place on the EU market or export from it are not associated with deforestation). These factors impact the supply of cocoa, and could potentially limit our ability to produce our products or significantly impact profitability.

During 2025, price volatility and the higher aggregate cost environment increased due to international supply chain and labor market disruptions and generally higher commodity, transportation and labor costs. We expect these conditions to continue to impact our aggregate commodity costs. In particular, while we expect cocoa costs to be lower in 2026 compared to the current year, we expect to continue to face elevated cocoa costs as compared to historical levels in the near- and medium-term due to these factors. It is possible that we may not be able to increase prices sufficiently to fully cover the incremental costs of cocoa prices in this environment and/or our hedging strategies may not protect us from increases in cocoa costs, which could result in a significant adverse impact on our profitability.

We address higher commodity costs and currency impacts primarily through hedging, higher pricing and manufacturing and overhead cost control. We use hedging techniques to limit the impact of fluctuations in the cost of our principal raw materials; however, we may not be able to fully hedge against commodity cost changes, such as dairy, where there is a limited ability to hedge, and our hedging strategies may not protect us from increases in specific raw material costs. Our commodity procurement practices are intended to mitigate price volatility and provide visibility to future costs, but also may potentially limit our ability to benefit from possible future price decreases. Additionally, our costs for major raw materials will not necessarily reflect market price fluctuations because of our forward purchasing and hedging practices. Due to competitive or market conditions, planned trade or promotional incentives, fluctuations in currency exchange rates or other factors, our pricing actions may also lag commodity cost changes temporarily.

Critical Accounting Estimates

We prepare our consolidated financial statements in conformity with U.S. GAAP. The preparation of these financial statements requires the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the periods presented. Actual results could differ from those estimates and assumptions. Note 1, Summary of Significant Accounting Policies, to the consolidated financial statements includes a summary of the significant accounting policies we used to prepare our consolidated financial statements. We have discussed the selection and disclosure of our critical accounting policies and estimates with our Audit Committee. The following is a review of our most significant assumptions and estimates.

Goodwill and Indefinite-Life Intangible Assets

We test goodwill and indefinite-life intangible assets for impairment on an annual basis on July 1 or whenever events or changes in circumstances indicate that the fair value of the reporting unit or indefinite-life intangible asset is more likely than not below its carrying value. Goodwill is tested for impairment at the reporting unit level, and we monitor our reporting structure on an ongoing basis to identify changes that could potentially impact the composition of our reporting units.

We have the option to assess goodwill for impairment by initially performing a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If we determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying value, then the quantitative goodwill impairment test is not required to be performed. If we determine that it is more likely than not that the fair value of a reporting unit is less than its carrying value, or if we elect not to perform an initial qualitative assessment, we perform a quantitative goodwill impairment test by comparing the estimated fair value of the reporting unit to its carrying value. When quantitative testing is performed, we estimate reporting unit fair values using a discounted cash flow method that incorporates earnings forecasts, market-based discount rates and terminal growth rates. If the carrying value of the reporting unit exceeds its estimated fair value, an impairment charge is recorded for the amount by which its carrying value, including goodwill, exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit.

In 2025, 2024 and 2023, there were no goodwill impairments, as each of our reporting units had sufficient fair value in excess of carrying value. While all reporting units passed our annual impairment testing, if planned business performance expectations are not met or valuation inputs outside of our control, such as discount rates, change significantly, then the estimated fair values of a reporting unit or reporting units might decline and lead to a goodwill impairment in the future.

We have the option to assess our indefinite-life intangible assets (primarily brand intangible assets) by initially performing qualitative assessments to determine whether it is more likely than not that the fair values of the indefinite-life intangible assets are less than their carrying values. If we determine that it is more likely than not that an indefinite-life intangible asset is impaired, or if we elect not to perform an initial qualitative assessment, we perform a quantitative impairment test by comparing the estimated fair value of the indefinite-life intangible asset to its carrying value. For indefinite-life intangible assets for which quantitative impairment testing is performed, we use several accepted valuation methods, including relief from royalty, excess earnings and excess margin, that utilize estimates of future sales, earnings growth rates, royalty rates and discount rates to estimate fair value. If the carrying value of the asset exceeds its fair value, we consider the asset impaired and reduce its carrying value to the estimated fair value.

We recognized intangible asset impairment charges of $33 million in 2025, $153 million in 2024 and $26 million in 2023 to reduce the carrying amounts of certain brands to their estimated fair values. Those charges are reported within asset impairment and exit costs in the consolidated statements of earnings. The 2025 impairments related to two biscuit brands in the Europe segment, one biscuit brand in the AMEA segment and one candy brand in the Latin America segment. The 2024 impairments related to two biscuit brands in the Europe segment, one biscuit brand in the AMEA segment and one candy and one biscuit brand in the Latin America segment. The 2023 impairments related to a chocolate brand in the North America segment and a biscuit brand in the Europe segment.

Including the four brands for which we recognized impairments in 2025, we identified five brand intangibles, as part of our annual test, for which fair value exceeded book value by less than 10%. The aggregate carrying value of those five brands was $1.5 billion as of December 31, 2025. We are closely monitoring the performance of those brands and if there are adverse changes to the related sales and earnings forecasts in the future, whether caused by business-specific or broader macroeconomic factors, one or more of those indefinite-life intangible assets could become impaired.

Refer to Note 6, Goodwill and Intangible Assets, for additional information.

Business Combinations

The assets acquired and liabilities assumed upon the acquisition or consolidation of a business are recorded at fair value (or other measurement attribute required by U.S. GAAP), with the residual of the purchase price recognized as goodwill. We engage third-party valuation specialists to assist management in determining the fair values of certain assets acquired and liabilities assumed. During the measurement period, which may be up to one year from the acquisition date, we may record adjustments to assets acquired and liabilities assumed with the corresponding offset to goodwill. The results of operations of an acquired business are included in our operating results from the date of acquisition.

In determining fair values of assets acquired and liabilities assumed in business combinations, we use several accepted valuation methods, including relief from royalty, excess earnings and excess margin, depending on the asset or liability being valued. Such valuations require management to make significant judgments, estimates and assumptions, especially with respect to intangible assets. Management makes estimates of fair value based upon the best information available at the date of acquisition. These estimates are based upon historical experience and information obtained from the management of the acquired company and are inherently uncertain. Critical estimates in valuing certain of the intangible assets include, but are not limited to: future sales, earnings growth rates, royalty rates, discount rates and economic lives of customer relationships, trade names and fixed assets. Unanticipated events and circumstances may occur, which may affect the accuracy or validity of such assumptions or estimates.

Further, certain of our acquisitions may include earn-out provisions or other forms of contingent consideration. As of the acquisition date, we record contingent consideration arrangements at their estimated fair values. Contingent consideration arrangements are subsequently remeasured to fair value each reporting period, with changes in fair value recognized in earnings. The estimated fair values of our contingent consideration liabilities are primarily determined using Monte Carlo simulations. Significant assumptions used in assessing the fair values of the liabilities include financial projections for net revenue, gross profit and EBITDA, as well as discount and volatility rates. Changes to those estimates and assumptions may occur due to various reasons, including the operating performance of the acquired business and/or changes in other valuation inputs.

Legal costs, due diligence costs, business valuation costs and all other business acquisition costs are expensed as incurred.

Trade and Marketing Programs

We promote our products with trade and sales incentives as well as marketing and advertising programs. These programs include, but are not limited to, new product introduction fees, discounts, coupons, rebates and volume-based incentives as well as cooperative advertising, in-store displays and consumer marketing promotions. Trade and sales incentives are recorded as a reduction to revenues based on estimates of the amounts due to customers and consumers at the end of a period. We base these estimates principally on historical utilization and redemption rates. Estimates that affect revenue, such as trade incentives and product returns, are monitored and adjusted each period until the incentives or product returns are realized. Advertising, consumer promotion and market research costs are recorded within selling, general and administrative expenses. For interim reporting purposes, those expenses are charged to operations as a percentage of volume, based on estimated sales volume and estimated program spending. We do not defer costs on our year-end consolidated balance sheets and all marketing and advertising costs are recorded as an expense in the year incurred.

Employee Benefit Plans

We sponsor various employee benefit plans worldwide, primarily including pension plans and postretirement healthcare benefit plans. We estimate the pension and postretirement healthcare benefit obligations for those plans utilizing assumptions and estimates for discount rates; expected returns on plan assets; expected compensation increases; employee-related factors such as turnover, retirement age and mortality; and health care cost trends. We review our actuarial assumptions on an annual basis and make modifications to the assumptions based on current rates and trends when appropriate. Our assumptions also reflect our historical experiences and management’s best judgment regarding future expectations. These and other assumptions affect the annual expense and obligations recognized for the underlying plans.

We amortize the effect of changes in the assumptions over future periods to reflect the cost or benefit of plan changes, such as increasing or decreasing benefits for prior employee service (prior service cost). These changes are deferred and included in expense on a straight-line basis over the average remaining service period of the employees expected to receive benefits.

Since pension and postretirement liabilities are measured on a discounted basis, the discount rate significantly affects our plan obligations and net periodic (benefit)/cost. For plans that have assets held in trust, the expected return on plan assets assumption also significantly affects our periodic (benefit)/cost. The assumptions for discount rates and expected return on plan assets and our process for setting these assumptions are described in Note 10, Benefit Plans, along with additional information on our employee benefit plans.

As a sensitivity measure, a fifty-basis point change in our discount rates or the expected rate of return on plan assets would have the following effects, increase/(decrease), on our annual benefit plan costs:

(in millions)

Income Taxes

As a global company, we calculate and provide for income taxes in each tax jurisdiction in which we operate. Our provision for income taxes includes amounts payable or refundable for the current year, the effect of deferred taxes and impacts from uncertain tax positions. Our provision for income taxes is significantly affected by shifts in the geographic mix of our pre-tax earnings across tax jurisdictions, changes in tax laws and regulations, tax planning opportunities available in each tax jurisdiction and the ultimate outcome of various tax audits.

We recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial statement and tax bases of our assets and liabilities, operating loss carryforwards and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which those differences are expected to reverse.

The realization of certain deferred tax assets is dependent on generating sufficient taxable income in the appropriate jurisdiction prior to the expiration of the carryforward periods. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. When assessing the need for a valuation allowance, we consider any carryback potential, future reversals of existing taxable temporary differences (including liabilities for unrecognized tax benefits), future taxable income and tax planning strategies.

We believe our tax positions comply with applicable tax laws and that we have properly accounted for uncertain tax positions. We recognize tax benefits in our financial statements from uncertain tax positions only if it is more likely than not that the tax position will be sustained by the taxing authorities based on the technical merits of the position. The amount we recognize is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon resolution. We evaluate uncertain tax positions on an ongoing basis and adjust the amount recognized in light of changing facts and circumstances, such as the progress of a tax audit or expiration of a statute of limitations. We believe the estimates and assumptions used to support our evaluation of uncertain tax positions are reasonable. However, final determination of historical tax liabilities, whether by settlement with tax authorities, judicial or administrative ruling or due to expiration of statutes of limitations, could be materially different from estimates reflected on our consolidated balance sheets and historical income tax provisions. The outcome of these final determinations could have a material effect on our provision for income taxes, net earnings or cash flows in the period in which the determination is made.

We monitor for changes in tax laws and reflect the impacts of tax law changes in the period of enactment. When there is refinement to tax law changes in subsequent periods, we account for the new guidance in the period when it becomes known.

Refer to Note 16, Income Taxes, for additional information on our effective tax rate, current and deferred taxes, valuation allowances and unrecognized tax benefits.

Contingencies

Refer to Note 11, Commitments and Contingencies, to the consolidated financial statements.

New Accounting Guidance

Refer to Note 1, Summary of Significant Accounting Policies, to the consolidated financial statements for a discussion of new accounting standards that have been adopted, as well as new accounting standards that have been issued but not yet adopted.

As we operate globally, we are primarily exposed to currency exchange rate, commodity price and interest rate market risks. We monitor and manage these exposures as part of our overall risk management program. Our risk management program focuses on the unpredictability of financial markets and seeks to reduce the potentially adverse effects that the volatility of these markets may have on our operating results.

We principally utilize derivative instruments to reduce significant, unanticipated earnings fluctuations that may arise from volatility in currency exchange rates, commodity prices and interest rates. For additional information on our derivative activity and the types of derivative instruments we use to hedge our currency exchange, commodity price and interest rate exposures, refer to Note 9, Financial Instruments.

Many of our non-U.S. subsidiaries operate in functional currencies other than the U.S. dollar. Fluctuations in currency exchange rates create volatility in our reported results as we translate the balance sheets, operating results and cash flows of these subsidiaries into the U.S. dollar for consolidated reporting purposes. The translation of non-U.S. dollar denominated balance sheets and statements of earnings of our subsidiaries into the U.S. dollar for consolidated reporting generally results in a cumulative translation adjustment to other comprehensive income within equity. A stronger U.S. dollar relative to other functional currencies adversely affects our consolidated earnings and net assets while a weaker U.S. dollar benefits our consolidated earnings and net assets. While we hedge significant forecasted currency exchange transactions as well as certain net assets of non-U.S. operations and other currency impacts, we cannot fully predict or eliminate volatility arising from changes in currency exchange rates on our consolidated financial results. Refer to Consolidated Results of Operations and Results of Operations by Operating Segment under Discussion and Analysis of Historical Results for currency exchange effects on our financial results. Throughout our discussion and analysis of results, we isolate currency impacts and supplementally provide net revenues, operating income and diluted earnings per share on a constant currency basis. For additional information on the impact of currency policies, recent currency devaluations and highly inflationary accounting on our financial condition and results of operations, also refer to Note 1, Summary of Significant Accounting Policies – Currency Translation and Highly Inflationary Accounting.

We also continually monitor the market for commodities that we use in our products. Input costs may fluctuate widely due to international demand, weather conditions, government policy and regulation and the macroeconomic environment. Refer to Recent Developments and Significant Items Affecting Comparability and Business Trends above for updates on recent supply chain, labor and other disruptions that are increasing operating costs and impacting our results. To manage input cost volatility and inflation, we enter into forward purchase agreements and other derivative financial instruments. We also pursue productivity and cost saving measures and take pricing actions when necessary to mitigate the impact of higher input costs on earnings.

We regularly evaluate our variable and fixed-rate debt as well as current and expected interest rates in the markets in which we raise capital. Our primary exposures include movements in U.S. Treasury rates, corporate credit spreads, commercial paper rates as well as limited debt tied to Secured Overnight Financing Rates (“SOFR”). We periodically use interest rate swaps and forward interest rate contracts to achieve a desired proportion of variable versus fixed-rate debt based on current and projected market conditions. For more information on our debt activity, refer to Note 8, Debt and Borrowing Arrangements.

Refer to Note 9, Financial Instruments, for more information on our derivative activity.

Value at Risk

We use a value at risk (“VAR”) computation to estimate: 1) the potential one-day loss in the fair value of our interest rate-sensitive financial instruments; and 2) the potential one-day loss in pre-tax earnings of our currency and commodity price-sensitive derivative financial instruments. The VAR analysis is computed as of each quarter end for our currency exchange, fixed income and commodity risk portfolios using historical market movements. The instruments included in the VAR computations are currency exchange forwards, swaps and options for currency exchange risk, debt and swaps for interest rate risk, and commodity futures and options for commodity risk. Excluded from the computations are anticipated transactions, foreign currency denominated trade payables and receivables, and net investments in non-U.S. subsidiaries, which the above-mentioned instruments are intended to hedge.

The VAR model assumes normal market conditions, a 95% confidence interval and a one-day holding period. A parametric delta-gamma approximation technique was used to determine the expected return distribution in interest rates, currencies and commodity prices for the purpose of calculating the fixed income, currency exchange and commodity VAR, respectively. The parameters used for estimating the expected return distributions were determined by observing interest rate, currency exchange and commodity price movements over the prior quarter for the calculation of VAR amounts at December 31, 2025 and 2024, and over each of the four prior quarters for the calculation of average VAR amounts during each year. The values of currency and commodity options do not change on a one-to-one basis with the underlying currency or commodity and were valued accordingly in the VAR computation.

As of December 31, 2025 and December 31, 2024, the estimated potential one-day loss in fair value of our interest rate-sensitive instruments, primarily debt, and the estimated potential one-day loss in pre-tax earnings from our currency and commodity instruments, as calculated in the VAR model, were:

(in millions)

This VAR computation is a risk analysis tool designed to statistically estimate the maximum expected daily loss, under the specified confidence interval and assuming normal market conditions, from adverse movements in interest rates, currency exchange rates and commodity prices. The computation does not represent actual losses in fair value or earnings we will incur, nor does it consider the effect of favorable changes in market rates. We cannot predict actual future movements in market rates and do not present these VAR results to be indicative of future movements in market rates or to be representative of any actual impact that future changes in market rates may have on our future financial results.