KHC 10-K & 10-Q changes, risk factors and insider trading

We may need to reduce our prices, or be restricted or delayed in our ability to increase prices, in response to competitive, customer, consumer, regulatory, or macroeconomic pressures, including pressures related to private label products that are generally sold at lower prices. These pressures have restricted, and may in the future continue to restrict, our ability to increase prices and maintain those price increases in response to commodity and other cost increases, including those related to inflationary pressures. Additionally, the pricing actions we take have, in some instances, negatively impacted, and could continue to negatively impact, our market share and require us to reduce, or further reduce, the prices of certain of our products. Furthermore, our competitors may attempt to gain market share by offering products at prices at or below those typically offered by our company, which may require us to increase spending on advertising and promotions and/or reduce prices. Failure to effectively assess, timely change, and properly set pricing, promotions, or trade incentives may negatively impact our ability to achieve our objectives.

Consumer preferences for food and beverage products change continually and rapidly. Our success depends on our ability to predict, identify, and interpret the tastes and dietary habits of consumers. We must continue to offer products that appeal to consumers, including with respect to their health and wellness preferences and changing consumption patterns, such as those potentially associated with weight-loss drugs. If we do not offer products that appeal to consumers, our sales and market share will decrease, which could materially and adversely affect our product sales, financial condition, and operating results. Further, changing consumer preferences relating to the healthiness or desirability of ingredients, components, or substances present or allegedly present in our products or packaging could negatively impact our product sales, financial condition, and operating results if we are unsuccessful in our efforts to satisfy consumer preferences.

Prolonged negative perceptions concerning the health, environmental, or social implications of certain food and beverage products, ingredients, additives, preservatives or packaging materials could influence consumer preferences and acceptance of our products and marketing programs. Our ability to refine the ingredient and nutrition profiles of and packaging for our products as well as to maintain focus on ethical sourcing and supply chain management opportunities to address evolving consumer preferences are important to our growth. We strive to respond to consumer preferences and social expectations, but we may not be successful in our efforts. Continued negative perceptions and failure to satisfy consumer preferences could materially and adversely affect our product sales, financial condition, and operating results.

We seek to maintain, extend, and expand our brand image through marketing investments, including advertising and consumer promotions, and product innovation. Negative perceptions of food and beverage marketing could adversely affect our brand image or lead to stricter regulations and scrutiny of our marketing practices. In 2025, we announced our commitment to remove Food, Drug & Cosmetic (“FD&C”) colors from our U.S. portfolio by the end of 2027. If we fail to achieve, or are perceived to have failed or been delayed in achieving, or improperly report on our progress toward achieving this goal, it could negatively affect our reputation or brand image. Moreover, adverse publicity about legal or regulatory action against us, our quality and safety, our environmental or social impacts, our other environmental, social, human capital,capital orand governance practices or positions, our products becoming unavailable to consumers, or our suppliers (including as a result of human rights issues) and, in some cases, our competitors, could damage our reputation and brand image, undermine our customers’ or consumers’ confidence, and reduce demand for our products, even if the regulatory or legal action is unfounded or not material to our operations. Furthermore, existing or increased legal or regulatory restrictions on our advertising, consumer promotions, and marketing, or our response to those restrictions, could limit our efforts to maintain, extend, and expand our brands.

In addition, our success in maintaining, extending, and expanding our brand image depends on our ability to adapt to a rapidly changing media environment. We increasingly rely on social media and online dissemination of advertising campaigns. The growing use of social and digital media increases the speed and extent that information, including misinformation, and opinions can be shared. Negative posts or comments about us, our brands or our products, or our suppliers and, in some cases, our competitors, on social or digital media, whether or not valid, could seriously damage our brands and reputation. In addition, we might fail to appropriately target our marketing efforts, anticipate consumer preferences, or invest sufficiently in maintaining, extending,maintaining and expanding our brand image. Placement of our advertisements in social and digital media may also result in damage to our brands if the media itself experiences negative publicity. If we do not maintain, extend,maintain and expand our reputation or brand image, then our product sales, financial condition, and operating results could be materially and adversely affected.

In nearly all of our product categories, we compete with branded products as well as private label products, which are typically sold at lower prices. Our products must provide higher value or quality to consumers than alternatives, particularly during periods of economic uncertainty or weakness or inflation.uncertainty. Consumers may not buy our products if relative differences in value or quality between our products and private label products change in favor of competitors’ products or if consumers perceive such a change. If consumers prefer private label products, then we could lose market share or sales volume, or our product mix could shift to lower margin offerings. A change in consumer preferences could also cause us to increase capital, marketing, and other expenditures, which could materially and adversely affect our product sales, financial condition, and operating results.

ClimateChanges changein environmental conditions and legalresponsive legislation or regulatory responsesregulation may have a long-term adverse impact on our business and results of operations.

The gradual increase in global average temperatures is projected to contribute to significant changes in weather patterns in the regions where we and our suppliers operate, including an increase in the frequency and severity of natural disasters, and changes in agricultural productivity. Increased natural disasters and decreased agricultural productivity in certainsuch regions of the world as a result of changing weather patterns may limit the availability or increase the cost of the natural resources and commodities,commodities includingused dairyin products,the meatproduction products,of tomatoour products,products. sugarChanging or severe weather and other sweeteners, soybean and vegetable oils, coffee beans, wheat and processed grains, eggs, and other fruits and vegetables to manufacture our products, and could further decrease food security for communities around the world. Climate change, and its environmental impacts,conditions could also affect our ability, and our suppliers’ ability, to procure necessary commodities at costs and in quantities we currently experience and may require us to increase costs or make additional unplanned capital expenditures. Further, an increase in the frequency and severity of natural disasters could result in disruptions for us, our customers, suppliers, vendors, co-manufacturers, and distributors and impact our employees’ abilities to commute or work from home effectively. These disruptions could make it more difficult and costly for us to deliver our products, obtain raw materials or other supplies through our supply chain, maintain or resume operations, or perform other critical corporate functions, could reduce customer demand for our products, and could increase the cost of insurance.

Additionally, there is ana increasedheightened focus by foreign, federal, state, and local regulatory and legislative bodies regarding environmental policies relating to a changing environment, including as a result of climate change, such as regulating greenhouse gas emissions (including carbon pricing or a carbon tax), energy policies, and disclosure obligations, and sustainability.obligations. Increased energy or compliance costs and expenses due toto, the impacts of climate change, as well asand additional legal or regulatory requirements regardingregarding, changing environmental conditions and climate change designed to reduce or mitigate the effects of carbon dioxide and other greenhouse gas emissions on the environment could be costly and may cause disruptions in, or an increase in the costs associated with, the running of our manufacturing and processing facilities and our business, as well as increase distribution and supply chain costs. Moreover, compliance with any such legal or regulatory requirements may require us to make significant changes to our business operations and long-term operating plans, which will likely incur substantial time, attention, and costs. Even if we make changes to align ourselves with such legal or regulatory requirements, we may still be subject to significant penalties if such laws and regulations are interpreted and applied in a manner inconsistent with our practices. The effects of climatea changechanging environment and responsive legal or regulatory initiatives to address climate change could have a long-term adverse impact on our business and results of operations.

Finally, we might failface toincreasing effectively address increased attentionscrutiny from the media, stockholders, activists, customers, enforcement authorities and other stakeholders who have conflicting views on climate change and relatedother environmental sustainabilitysustainability-related matters. SuchOur failure,published oractivities, theprogress, perceptionobjectives, thatand wepriorities haveon failedthese totopics act responsibly with respect to such matters or to effectively respond to new or additional regulatory requirements regarding climate change, whether ormay not valid,satisfy all of our stakeholders and could result in adverse publicity or legal liability and negatively affect consumer preferences for our products, investor confidence in our stock, and our business and reputation. Concurrently, there also exists “anti-ESG” sentiments among certain stakeholders, andAdditionally, we may facebecome negativethe publicity,target lawsuits,of andlitigation, investigations, or other adverseproceedings impactsinitiated by government authorities or private actors alleging that our activities or positions related to oursustainability-related businessmatters fromare theseanti-competitive, stakeholdersdiscriminatory inor responseotherwise to our sustainability initiatives.unlawful. From time to time we establish and publicly announce environmental, social, and governancesustainability-related goals, commitments, and aspirations, including to reduce our impact on the environment. Our ability to achieve any stated goal, target,goal 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 pace of changes in technology, the availability of requisite financing, and the availability of suppliers that can meet our sustainability and other standards. Furthermore, standards for tracking and reportingreporting, suchas matterswell continue to evolve. Our selection of voluntary disclosure frameworks and standards, and the interpretation or application of those frameworks and standards, may change from time to time or differ from those of others. Methodologies for reporting 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 ofas our operations, and other changes in circumstances. Our processes and controls for reporting sustainability and other matters across our operationsorganization andcontinue supplyto chainevolve. are evolving along with multiple disparate standards for identifying, measuring, and reporting sustainability metrics, including sustainability-relatedSustainability-related disclosures that may be required by the SEC, European Union,Union and other foreign, federal, state, and local regulatory and legislative bodies (including, but not limited to, the European Union’s Corporate Sustainability Reporting Directive and Corporate Sustainability Due Diligence Directive and the state of California’s new climate change disclosure requirements), and such standards may change over time, 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. If we fail to achieve, or are perceived to have failed or been delayed in achieving, or improperly report on our progress toward achieving these goals and commitments, it could negatively affect consumer preference for our products or investor confidence in our stock, as well as expose us to government enforcement actions and private litigation.

From time to time, we have evaluated and may continue to evaluate acquisition candidates, divestiture opportunities, alliances, joint ventures, or investments that may strategically fit our business objectives, and, as a result of some of these evaluations, we have acquired businesses or assets that we deem to be a strategic fit. We have also divested and may consider divesting businesses that do not meet our strategic objectives or growth or profitability targets.objectives. These activities may present financial,financial managerial, and operational risks including, but not limited to, diversion of management’s attention from existing core businesses; difficulties in integrating, or inability to successfully integrate, acquired businesses, including integrating or separating personnel and financial and other systems; inability to effectively and immediately implement control environment processes across a diverse employee population; adverse effects on existing or acquired customer and supplier business relationships; and potential disputes with buyers, sellers, or partners. ActivitiesFurther, such activities in suchcertain areas are regulated by numerous antitrust and competition laws in the United States, Canada, the European Union, the United Kingdom, and elsewhere. We have in the past and may in the future be required to obtain approval of these transactions by competition authorities or to satisfy other legal requirements, and we may be unable to obtain such approvals or satisfy such requirements, each of which may result in additional costs, time delays, or our inability to complete such transactions, which could materially and adversely affect our financial condition and operating results.

To the extent we undertake acquisitions, alliances, joint ventures, investments, or other developments in new geographies or categories,investments we may face additionaldifficulties integrating, or be unable to integrate, the new business operations within our current sourcing, distribution, information technology systems, and control environment. Additionally, we may face risks related to suchthe developments.integration Forof example,personnel. Further, for these activities which occur in foreign jurisdiction, we may be subject to additional risks related to foreign operations areas discussed below under the risk factor titled “Our international operations subject us to additional risks and costs and may cause our profitability to decline.”

To the extent we undertakepursue divestitures,divestiture opportunities, we may face additional risks related to such activities. For example, risks related to our ability to find appropriate buyers, obtain applicable regulatory and governmental approvals, execute transactions on favorable terms, separate divested business operations with minimal impact to our remaining operations, and effectively manage any transitional service arrangements. Further, our divestiture activities have in the past required, and may in the future require, us to recognize impairment charges. Any of these factors could materially and adversely affect our financial condition and operating results.

We plan to continue to conduct strategic initiatives in various markets. Consumer demands, behaviors, tastes, and purchasing trends may differ in these markets and, as a result, our sales strategies may not be successful and our product sales may not meet expectations, or the margins on those sales may be less than currently anticipated. We may also face difficulties integrating new business operations with our current sourcing, distribution, information technology systems, and other operations. Additionally, we may not successfully complete any planned strategic initiatives, including achieving any previously announced productivity efficiencies and financial targets, any new business may not be profitable or meet our expectations, or any divestiture may not be completed without disruption. Any of these challenges could hinder our success in new markets or new distribution channels, whichand could adversely affect our results of operations and financial condition.

We may be unable to realize the anticipated benefits from prior or future streamlining actionsinitiatives to reduce fixed costs, simplify or improve processes, or improve our competitiveness.

We have evaluated and implemented a number of initiatives,strategic includinginitiatives developmentwith the intention of an operations center and strategic long-term collaboration with suppliers, that we believe are important to position our business for future success and growth. We have evaluated and continue to evaluate changes to our organizational structure and operations to enableenabling us to reduce costs, simplify or improve processes,productivity, and improve our competitiveness. Our future success may depend upon our ability to realize the benefits of these or other cost-saving initiatives. In addition, certain of our initiatives may lead to increased costs in other aspects of our business such as increased conversion, outsourcing, or distribution costs. We must accurately predict anticipated costs and be efficient in executing any plans to achieve costthese savings and operate efficiently in the highly competitive food and beverage industry, particularly in an environment of increased competition.initiatives. To capitalize on our efforts, we must carefully evaluate investments in our business and execute in those areas with the most potential return on investment.investment, and operate efficiently in the highly competitive food and beverage industry, particularly in an environment of increased competition. If we are unable to realize the anticipated benefits from any cost-savingthese efforts, we could be cost disadvantaged in the marketplace, and our competitiveness, production, profitability, financial condition, and operating results could be adversely affected.

As of DecemberJanuary 28,16, 2024,2026, Berkshire Hathaway Inc. (“Berkshire Hathaway”) owns approximately 27.2%27.5% of our common stock. Two members of our Board are officers and/or directors of Berkshire Hathaway or its affiliates. As a result, Berkshire Hathaway has the potential to exercise influence over management and Board decisions, including those affecting our capital structure, such as the issuance of additional capital stock, the incurrence of additional indebtedness, the implementation of stock repurchase programs, and the declaration and amount of dividends. Berkshire Hathaway also has influence over any action requiring the approval of the holders of our common stock, including adopting any amendments to our charter, electing directors, and approving mergers or sales of substantially all of our capital stock or assets. In addition, Berkshire Hathaway is in the business of making investments in companies and may from time to time acquire and hold interests in businesses that compete directly or indirectly with us. Berkshire Hathaway may also pursue acquisition opportunities that may be complementary to our business, and, as a result, those opportunities may not be available to us.

•requiring a substantial portion of cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, thereby reducing our ability to use our cash flow to fund our operations, payments of dividends, capital expenditures, stock repurchases, and future business opportunities;

As of December 28,27, 2024,2025, we maintain 1210 reporting units,units eightglobally, six of which comprise our goodwill balance. Our indefinite-lived intangible asset balance primarily consists of a number of individual brands. As of December 27, 2025, we had goodwill and intangible assets with a total carrying amount of $59.7 billion. In 2025, we recorded non-cash goodwill impairment losses of $9.3 billion related to these assets. We test our reporting units and brands for impairment annually as of the first day of our third quarter, or more frequently if events or circumstances indicate it is more likely than not that the fair value of a reporting unit or brand is less than its carrying amount. Such events and circumstances could include a sustained decrease in our market capitalization, increased competition or unexpected loss of market share, increased input costs beyond projections, disposals of significant brands or components of our business, unexpected business disruptions (for example due to a natural disaster, pandemic, or loss of a customer, supplier, or other significant business relationship), unexpected significant declines in operating results, significant adverse changes in the markets in which we operate, changes in income tax rates, changes in interest rates, or changes in management strategy. We test reporting units for impairment by comparing the estimated fair value of each reporting unit with its carrying amount. We test brands for impairment by comparing the estimated fair value of each brand with its carrying amount. If the carrying amount of a reporting unit or brand exceeds its estimated fair value, we record an impairment loss based on the difference between fair value and carrying amount, in the case of reporting units, not to exceed the associated carrying amount of goodwill.

Reporting units and brands that have 20% or less excess fair value over carrying amount as of the 20242025 annual impairment test performed as of June 30,29, 20242025 had an aggregate carrying value of $37.2 billion as of the date of 2025 annual impairment test. These reporting units and brands have a heightened risk of future impairments if any assumptions, estimates, or market factors change in the future. Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors. Estimating the fair value of individual reporting units and brands requires us to make assumptions and estimates regarding our future plans, as well as industry, economic, and regulatory conditions.conditions, and to consider the market multiples of certain peer and guideline companies. These assumptions and estimates include estimated future annual net cash flows (including net sales, cost of products sold, SG&A, depreciation and amortization, working capital, and capital expenditures), income tax rates, discount rates, long-term growth rates, royalty rates, contributory asset charges, and other market factors. If current expectations of future growth rates and margins are not met, if market factors outside of our control,control change; such as discount rates, market capitalization, income tax rates, foreign currency exchange rates, or inflation, change, or if management’s expectations or plans otherwise change, including updates to our long-term operating plans, then one or more of our reporting units or brands might become impaired in the future, which could negatively affect our operating results or net worth. Furthermore, changes in reporting units, including as a result of integrating a new acquisition into an existing reporting unit that has a fair value below carrying amount of goodwill, have led, and could in the future lead, to an impairment of goodwill. Additionally, any decisions to divest certain non-strategic assets has led, and could inlead theto future lead, to goodwill or intangible asset impairments. See Note 9, Goodwill and Intangible Assets in Item 8, Financial Statements and Supplementary Data and Critical Accounting Estimates in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, for additional information on our goodwill and intangible assets.

We derive a substantial portion of our net sales from international markets. We hold assets, incur liabilities, earn revenue, and pay expenses in a variety of currencies other than the U.S. dollar, primarily the Canadian dollar, euro, British pound sterling, Australian dollar, Brazilian real, Chinese renminbi, Russian ruble, Indonesian rupiah, and New Zealand dollar, and Russian ruble.dollar. Since our consolidated financial statements are reported in U.S. dollars, fluctuations in foreign currency exchange rates from period to period, which have been more volatile recently, will have an impact on our reported results. We have implemented foreign currency hedges intended to reduce our exposure to changes in foreign currency exchange rates. However, these hedging strategies may not be successful, and any of our unhedged foreign exchange exposures will continue to be subject to market fluctuations. In addition, in certain circumstances, we may incur costs in one currency related to services or products for which we are paid in a different currency. As a result, factors associated with our international operations, including changes in foreign currency exchange rates, could significantly affect our results of operations and financial condition.

We purchase and use large quantities of commodities, including dairy products, meat products, tomato products, sugar and other sweeteners, coffee, tomato products, soybean and vegetable oils, coffeeeggs, beans,other fruits and vegetables, and wheat and processed grains, eggs, and other fruits and vegetablesgrains to manufacture our products. In addition, we purchase and use significant quantities of plastics, resin, cardboard, resin,glass, glass,paper and metal to package our products, and we use other inputs, such as electricity, natural gas, and water, to operate our facilities. We are also exposed to changes in oil prices, including diesel fuel, which influence both our packaging and transportation costs. Prices for commodities, energy, and other supplies are volatile and can fluctuate due to conditions that are difficult to predict, particularly due to inflationary pressures, due in part to changes in governmental regulation, including the recent tariff and trade policy actions taken by the United States and foreign governments. Further, we have experienced, and may continue to experience, input cost volatility due global competition for resources, inflationary pressure, foreign currency fluctuations, geopolitical conditions or conflicts, cybersecurity incidents, severe weather, natural disasters, global climate change, water risk, pandemics, crop failures, crop shortages due to plant disease or insect and other pest infestation, consumer, industrial, or investment demand, and changes in governmentalconsumer regulation and trade, tariffs,demand, alternative energy,energy initiatives, including increased demand for biofuels, and agricultural programs. Additionally, we may be unable to maintain favorable arrangements with respect to the costs of procuring raw materials, packaging, services, and transporting products, which could result in increased expenses and negatively affect our operations. Furthermore, the cost of raw materials and finished products may fluctuate due to changes in cross-currency transaction rates. Rising commodity, energy, and other input costs could materially and adversely affect our cost of operations, including the manufacture, transportation, and distribution of our products, which could materially and adversely affect our financial condition and operating results.

In 2024,2025, we experienced moderateincreased inflationinflationary pressures in our supply chain costs compared to the prior year period, whichdue wein expect to continue through 2025. While inflationary pressures within procurement, manufacturing, and logistics costs had a negative impact on our results of operations, we experienced increased stability of these costs as comparedpart to the priortariff yearand period.trade policy actions taken by the United States and foreign governments during the year. We expect these inflationary trends to moderate through 2026, although there continues to be significant uncertainty. Although we take measures to mitigate the impact of this inflation through pricing actions and efficiency initiatives, if these measures are not effective our financial condition, operating results, and cash flows could be materially adversely affected. Even if such measures are effective, we expect that there could be a difference between the timing of when these beneficial actions impact our results of operations and when the cost inflation is incurred. Additionally, the pricing actions we take have, in some instances, negatively impacted and could continue to negatively impact our market share.

As a large, global food and beverage company, we operate in a highly regulated environment with constantly evolving legal and regulatory frameworks. Various laws and regulations govern our practices including, but not limited to, those related to advertising and marketing, product claims and labeling, food production and nutritional requirements, environmental matters (including climate change), packaging and waste management (including packaging containing PFAS), intellectual property, consumer protection and product liability, commercial disputes, trade and export controls, anti-trust, data privacy, labor and employment, workplace health and safety, forced labor, such as the UFLPA, and tax. As a consequence, we face a heightened risk of legal claims and regulatory enforcement actions in the ordinary course of business. In addition, the imposition of new laws, changes in laws or regulatory requirements or changing interpretations thereof, and differing or competing regulations and standards across the markets where our products are made, manufactured, distributed, and sold have in the past and could continue to result in higher compliance costs, capital expenditures, and higher production costs, adversely impacting our product sales, financial condition, and results of operations. In addition, claims about the health impacts of consumption of our products, or ingredients, additives, preservatives, components, or substances present or allegedly present in those products or packaging, including in connection with the development, manufacture, and marketing of our products, have resulted in, and could in the future result in, us being subject to regulations, fines, lawsuits,lawsuits (including but not limited to pending litigation alleging that certain of our products are “ultra-processed” and consuming them causes adverse health impacts, allegations with which we strongly disagree), or taxes, or may cause us to change the way in which we operate which could adversely impact our profitability, financial condition, or operating results.

Our borrowing costs can be affected by short and long-term credit ratings assigned by rating organizations. A decrease in these credit ratings could limit our access to capital markets and increase our borrowing costs, which could materially and adversely affect our financial condition and operating results. As of the date of this filing, our long-term debt is rated BBB by S&P Global Ratings and Fitch Ratings and Baa2 by Moody’s Investor Services, Inc., with a stable outlook from allS&P threeGlobal Ratings, BBB with a rating watch negative outlook from Fitch Ratings, and Baa2 with ratings agencies.under review for downgrade from Moody’s Investor Services, Inc.

Kraft Heinz and Berkshire Hathaway are party to a registration rights agreement requiring us to register for resale under the Securities Act all registrable shares held by Berkshire Hathaway, which represents all shares of our common stock held by Berkshire Hathaway as of the date of the closing of the 2015 Merger. As of DecemberJanuary 28,16, 2024,2026, registrable shares represented approximately 27.2%27.5% of all outstanding shares of our common stock. Although the registrable shares are subject to certain holdback and suspension periods, the registrable shares are not subject to a “lock-up” or similar restriction under the registration rights agreement. Accordingly, offers and sales of a large number of registrable shares may be made pursuant to an effective registration statement under the Securities Act in accordance with the terms of the registration rights agreement. SalesPursuant to the registration rights agreement, on January 20, 2026, we filed a prospectus supplement with the SEC to register for resale up to 325,442,152 shares of our common stock held by Berkshire Hathaway. The filing of the prospectus supplement was made solely to register these shares for resale, does not itself constitute a sale of any shares, and does not necessarily mean that Berkshire Hathaway will sell any or all of the registered shares. If any of these registered shares are sold, we will not receive any proceeds from those sales. Because the registered shares represent a significant portion of the outstanding shares of our common stock, any future sales by Berkshire Hathaway tocould other persons would likely result in anmaterially increase in the number of shares being traded in the public market and may materially increase the volatility ofof, and cause a decrease in, the price of our common stock. In addition, the filing of the prospectus supplement and the perception of future sales by Berkshire Hathaway have already contributed to increased volatility of our common stock and could continue to affect the volatility of our common stock in the future.

In November 2023, the Board authorized the Company to repurchase up to $3.0 billion, exclusive of fees, of our outstanding common stock through December 26, 2026. As of December 28,27, 2024,2025, we had remaining authorization under the share repurchase program of approximately $1.9$1.5 billion. Our repurchase program does not obligate us to repurchase any specific dollar amount or to acquire any specific number of shares. The timing and amount of any repurchases, if any, will depend on factors such as our historical and expected business performance and cash and liquidity positions, the price of our stock, economic and market conditions, and corporate and regulatory requirements. Our share repurchase program could affect the price of our stock and increase volatility and may be suspended or terminated at any time. We cannot guarantee that we will repurchase shares or conduct future share repurchase programs, or that any such programs, even if fully implemented, will result in long-term increases to stockholder value. Any failure to fully implement our repurchase program may negatively impact our reputation, investor confidence, and the price of the Company’s common stock.

Escalation of geopolitical tensions related to military conflict, including increased trade barriers or restrictions on global trade, could result in, among other things, supply chain disruptions, changes in consumer demand, increased cyberattacks, and impacts on foreign exchange rates and financial markets, any of which may adversely affect our business, financial condition, and results of operations. Although we do not have operations in Ukraine, and our business in Russia generated approximately 1% of our consolidated net sales for the year ended December 28,27, 2024,2025, the military conflict between Russia and Ukraine has caused, and could continue to cause, negative impacts on our business and the global economy. Governments in the United States, Canada, United Kingdom, and European Union have each imposed export controls and economic sanctions on certain industry sectors and parties in Russia. Further, the Russian government has placed restrictions on the transfer of funds to and from Russian entities, making it more difficult to operate in Russia.Russia and to repatriate cash to other jurisdictions from our Russian business, which had a cash and cash equivalents balance equal to approximately $140 million as of December 27, 2025. Failure to comply with applicable sanctions and measures could subject us to regulatory penalties, temporary or permanent loss of assets, or our ability to conduct business operations in Russia. While less than 1% of consolidated total assets are located in Russia as of December 28,27, 2024,2025, our Russian assets may be partially or fully impaired in future periods, or our business operations terminated, based on actions taken by Russia, other parties, or us. The effects of current geopolitical conflicts as well as potential future geopolitical tensions, could heighten many of our known risks described in this Item 1A, Risk Factors.

Our performance has been in the past and may continue in the future to be impacted by economic and political conditions in the United States and in other nations where we do business. Economic and financial uncertainties in our international markets, changes to major international trade arrangements, and the imposition of increased or new tariffs by the U.S. federal governmentgovernment, oras well as retaliatory tariffs by certain foreign governments have negatively impacted, and could continue to negatively impact our operations and sales. Other factors impacting our operations in the United States and in international locations where we do business include changes in laws, export and import restrictions, foreign currency exchange rates, foreign currency devaluation, cash repatriation restrictions, recessionary conditions, governmental subsidies provided to our consumers such as the Supplemental Nutrition Assistance Program (“SNAP”) in the U.S., foreign ownership restrictions, nationalization, the impact of hyperinflationary environments, a potential U.S. federal government shutdown, terrorist acts, political unrest, and military conflict. Such factors in either domestic or foreign jurisdictions, and our responses to them, could materially and adversely affect our product sales, financial condition, and operating results.

We manufacture and market food and beverage products around the world through our eight consumer-driven product platforms: Taste Elevation, Easy Ready Meals, Hydration, Meats, Cheeses, Substantial Snacking, Desserts, Hydration, Cheese, Coffee, Meats, and other grocery products.

InWe the first quarter of 2024, we dividedmanage our Internationaloperating segmentresults intothrough threefour operating segments: —North America, Europe and Pacific Developed Markets (“EPDM” or “International Developed Markets”), West and East Emerging Markets (“WEEM”), and Asia Emerging Markets (“AEM”) — to enable enhanced focus on the different strategies required for each of these regions as part of our long-term strategic plan. Subsequently, we manage our operating results through four operating segments.. We have two reportable segments defined by geographic region: North America and International Developed Markets. Our remaining operating segments, consisting of WEEM and AEM, are combined and disclosed as Emerging Markets.

Business Trends and Items Affecting Comparability of Financial Results

Our results of operations reflect goodwill impairment losses of $6.7 billion and intangible asset impairment losses of $2.6 billion in 2025 compared to goodwill impairment losses of $1.6 billion and intangible asset impairment losses of $2.0 billion in 2024. We recognized goodwill impairment losses of $510 million and intangible asset impairment losses of $152 million in 2023. We recognized goodwill impairment losses of $444 million, intangible asset impairment losses of $469 million, and net property, and plant, and equipment asset impairment losses of $86 million in 2022. See Note 8,9, Goodwill and Intangible Assets, in Item 8, Financial Statements and Supplementary Data, for additional information on our goodwill and intangible asset impairment losses.

In 2025, we entered into a definitive agreement to sell our infant and specialty food business in Italy, within our International Developed Markets segment. On December 31, 2025, which is in the first quarter of our fiscal year 2026, we closed the sale for total cash consideration of approximately $146 million. In 2024, we closed the sale of our infant nutrition business in Russia (the “Russia Infant Transaction”) and the sale of 100% of the equity interests in our Papua New Guinea subsidiary (the “Papua New Guinea Transaction”), both within Emerging Markets. In 2022, we completed the Hemmer Acquisition within Emerging Markets, and the Just Spices Acquisition within our International Developed Markets segment. See Note 4,5, Acquisitions and Divestitures, in Item 8, Financial Statements and Supplementary Data, for additional information on our acquisition and divestiture activities.

Net sales decreased 3.0%3.5% to $24.9 billion in 2025 compared to $25.8 billion in 2024 compared to $26.6 billion in 2023,2024, including the unfavorable impacts of foreign currency (0.7 pp) and acquisitions and divestitures (0.20.1 pp). Organic Net Sales decreased 2.1%3.4% to $25.9$24.9 billion in 20242025 compared to $26.5$25.8 billion in 2023,2024, primarily due to the unfavorable volume/mix (3.54.1 pp), which more than offset higher pricing (1.40.7 pp). Pricing was higher in Northeach America and Emerging Markets, and flat in International Developed Markets.segment. Volume/mix in North America and International Developed Markets was unfavorable, while volume/mix in Emerging Markets was favorable.

Operating income/(loss) decreased 63.2%377.4% to a loss of $4.7 billion in 2025 compared to income of $1.7 billion in 20242024, compared to $4.6 billion in 2023,primarily due to non-cash impairment losses that were $3.0$5.6 billion higher in the current year period. TheIn remaining changeaddition to the impact of these non-cash impairment losses, operating income/(loss) wasdecreased an increase of $118$715 million primarilydue drivento byinflationary higherpressures pricing,in lower variable compensation expense,commodity and lowermanufacturing procurementcosts andthat logistics costs, due, in part, to the beneficial impact fromoutpaced our efficiency initiatives.initiatives, unfavorable volume/mix, separation costs incurred in the current year, unfavorable changes in unrealized losses/(gains) on commodity hedges, increased advertising expenses and increased research and development costs. These favorableunfavorable impacts to operating income/(loss) were partially offset by unfavorablehigher volume/mix, increased manufacturing expenses due to increased labor costs,pricing and increased selling,decreased general andcorporate administrative expenses (“SG&A”) due, in part, to investments in technology.expenses.

Net income/(loss) increaseddecreased 20.2%313.0% to $2.8a loss of $5.8 billion in 20232025 compared to $2.4income of $2.7 billion in 2022.2024. This increasedecrease was drivendue byto the unfavorable changes in operating income/(loss) factors discussed aboveabove, higher income tax expense and lowerhigher interest expense, which more thanpartially offset unfavorableby favorable changes in other expense/(income) and higher tax expense..

•Our effective tax rate was 21.7%an expense of 7.4% on pre-tax loss in 20232025 compared to 20.2%a benefit of 220.5% on pre-tax income in 2022.2024. The year-over-year increase in the effective tax rate was due primarily to higher non-deductible goodwill impairments in the decreasecurrent inyear and recognizing a non-U.S. deferred tax liabilitiesasset dueas toa result of the mergermovement of certain foreignbusiness entitiesoperations andto a wholly-owned subsidiary in the revaluationNetherlands ofoffset by establishing valuation allowances on certain non-U.S. deferred tax balances due to changes in state tax lawsassets in the prior year versus the current year.

Adjusted Operating Income increaseddecreased 6.2%11.5% to $5.3$4.7 billion in 20232025 compared to $5.0$5.4 billion in 2022,2024, primarily due to higherinflationary pricingpressures in commodity and themanufacturing beneficialcosts impactthat fromoutpaced our efficiency initiatives, which more than offset higher commodity costs, including the impact of realized gains and losses on commodity hedges; higher supply chain costs, reflecting inflationary pressure in manufacturing, procurement, and logistics; unfavorable volume/mix;mix, increased SG&A, primarily advertising expenses;expenses, theincreased decreaseresearch fromand lappingdevelopment a 53rd week of shipments in the prior period (2.2 pp);costs, and the unfavorable impact of foreign currency (1.20.1 pp). These unfavorable impacts more than offset higher pricing and decreased general corporate expenses.

Diluted EPS decreased 2.2%318.1% to $(4.93) in 2025 compared to $2.26 in 2024 compared to $2.31 in 2023,2024, primarily drivendue byto the net income/(loss) factors discussed aboveabove, andwhich more than offset the favorable impact of our common stock repurchases.

Adjusted EPS increaseddecreased 7.2%15.0% to $2.98$2.60 in 20232025 compared to $2.78$3.06 in 2022,2024 primarily drivendue byto higherlower Adjusted Operating IncomeIncome, higher taxes on adjusted earnings, and lowerhigher interest expense, which more than offset the decreasefavorable from lapping a 53rd weekimpact of shipmentsour incommon thestock priorrepurchases period,and unfavorablefavorable changes in other expense/(income), and higher taxes on adjusted earnings..

Management evaluates segment performance based on several factors, including net sales, Organic Net Sales, and Segment Adjusted Operating Income. In the first quarter of 2024, certain measures utilized by management to evaluate segment performance changed, including a change from Segment Adjusted EBITDA to Segment Adjusted Operating Income in order to drive a stronger connection to our long-term strategic plan. Segment Adjusted Operating Income is defined as operating income/(loss) excluding, when they occur, the impacts of restructuring activities, deal costs, unrealized gains/(losses) on commodity hedges (the unrealized gains and losses are recorded in general corporate expenses until realized; once realized, the gains and losses are recorded in the applicable segment’s operating results), impairment losses, separation costs, and certain non-ordinary course legal and regulatory matters. Segment Adjusted Operating Income for Emerging Markets, which represents the aggregation of our WEEM and AEM operating segments, is defined and presented consistently with the Segment Adjusted Operating Income of our reportable segments — North America and International Developed Markets. Segment Adjusted Operating Income is a financial measure that can assist management and investors in comparing our performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our underlying operations. Management also uses Segment Adjusted Operating Income to allocate resources. We have reflected this change from Segment Adjusted EBITDA to Segment Adjusted Operating Income in all historical periods presented.

Under highly inflationary accounting, the financial statements of a subsidiary are remeasured into our reporting currency (U.S. dollars) based on the legally available exchange rate at which we expect to settle the underlying transactions. Exchange gains and losses from the remeasurement of monetary assets and liabilities are reflected in other expense/(income) on our consolidated statement of income, as nonmonetary currency devaluation, rather than accumulated other comprehensive income/(losses) on our consolidated balance sheet, until such time as the economy is no longer considered highly inflationary. See Note 2, Significant Accounting Policies, in Item 8, Financial Statements and Supplementary Data, for additional information. We apply highly inflationary accounting to the results of our subsidiaries in Venezuela, Argentina, Turkey, Egypt,Venezuela, and Nigeria,Egypt, which are all in Emerging Markets.

Net sales decreased 2.9%4.9% to $18.6 billion in 2025 compared to $19.5 billion in 2024 compared to $20.1 billion in 2023,2024, including the unfavorable impacts of foreign currency (0.10.2 pp). Organic Net Sales decreased 2.8%4.7% to $19.6$18.6 billion in 20242025 compared to $20.1$19.5 billion in 2023,2024, primarily due to unfavorable volume/mix (4.25.0 pp), which more than offset higher pricing (1.40.3 pp). Higher pricing was primarily driven by increases to mitigate higher input costs. Unfavorable volume/mix was primarily due to shiftsdeclines in consumercold behaviorcuts, duecoffee, certain condiments, bacon, frozen snacks, and desserts. Higher pricing was taken in certain categories to economicmitigate uncertainty,higher ainput declinecosts, primarily in Lunchables, and a temporary plant closure.coffee.

Net sales decreasedincreased 2.4%0.1% to $3.5 billion in 20242025 compared to $3.6$3.5 billion in 2023,2024, including the favorable impacts of foreign currency (0.42.0 pp). Organic Net Sales decreased 2.8%1.9% to $3.5 billion in 20242025 compared to $3.6$3.5 billion in 2023,2024, primarily due to unfavorable volume/mix (2.8 pp), whilewhich more than offset higher pricing remained(0.9 flat.pp). Unfavorable volume/mix was primarily due to acontinued temporaryindustry pauseslowdowns of meals in shipmentsthe asUnited a result of a contract negotiation with certain customers in our Continental Europe region,Kingdom and lowerpricing saleselasticity in New Zealand due to an inventory reduction by a regional customer.Zealand.

Segment Adjusted Operating Income increased 3.0%1.0% to $0.5$543 billionmillion in 20242025 compared to $0.5$537 billionmillion in 2023,2024, primarily driven by lowerhigher procurement and logistics costs due, in part, to the beneficial impact from our efficiency initiatives, lapping the prior year business disruption caused by Cyclone Gabrielle in Australia and New Zealand, lower variable compensation expense, andpricing, the favorable impact of foreign currency (1.83.2 pp)., decreased advertising expenses, and lower amortization expense. These favorable impacts to Segment Adjusted Operating Income weremore partiallythan offset unfavorable volume/mix and increased inflationary pressures in manufacturing expenses.and procurement costs that outpaced our efficiency initiatives.

Net sales decreasedincreased 4.3%1.8% to $2.8 billion in 20242025 compared to $2.9$2.8 billion in 2023,2024, including the unfavorable impacts of foreign currency (6.22.4 pp) and acquisitions and divestitures (2.10.4 pp). Organic Net Sales increased 4.0%4.6% to $2.9$2.8 billion in 20242025 compared to $2.7 billion in 2023,2024, primarily driven by higher pricing (3.54.0 pp) and favorable volume/mix (0.50.6 pp). Higher pricing was taken primarily in ourcertain Easterncountries Europewithin and Middle East and Africa (“MEA”) regionsWEEM to address higherinflationary input costs,pressures, which more than offset lower pricing in Brazil as a result of maintaining price gaps to competition.Indonesia. Favorable volume/mix withinwas ourprimarily Easterndriven Europeby Taste Elevation, particularly in Brazil and MEAChina, which more than offset unfavorable volume/mix in Brazil and China.Indonesia.

Segment Adjusted Operating Income increased 17.6%6.2% to $376$341 million in 20232025 compared to $319$321 million in 2022,2024, primarily drivendue byto higher pricingpricing, reduced manufacturing costs, primarily as a result of our efficiency initiatives, and favorable volume/mix,mix. partiallyThese favorable impacts to Segment Adjusted Operating Income more than offset by higher supplyprocurement chainand costs,logistics costs reflecting inflationary pressure in LATAM and Eastern Europe regions;WEEM, increased SG&Aadvertising due,expenses, unfavorable changes in part,allowances tofor investmentstrade receivables in advertising and research and development;Indonesia, the unfavorable impact of foreign currency (14.14.5 pp);, increasedand higher depreciation expense; and the decrease from lapping a 53rd week of shipments in the prior period (2.7 pp).expense.

We believe that cash generated from our operating activities, as well as our access to other potential sources of liquidity including our available-for-sale debt securities, commercial paper programs, and our senior unsecured revolving credit facility (the “Senior Credit Facility”) will provide sufficient liquidity to meet our working capital needs, repayments of long-term debt, future contractual obligations, payment of our anticipated quarterly dividends, planned capital expenditures, restructuring expenditures, and contributions to our postemployment benefit plans for the next 12 months. An additional potential source of liquidity is access to capital markets. We intend to use our cash on hand and commercial paper programs for daily funding requirements.

In the first quarter of 2024, we consummated the Russia Infant Transaction for total cash consideration of approximately $25 million, and the Papua New Guinea Transaction for total cash consideration of approximately $22 million, which is to be paid incrementally over two years following the transaction closing date.million.

During the threesix months ended MarchJune 28,27, 2026, we experienced inflationary pressures in our supply chain costs at rates lower than those we experienced in the prior year period. However, we expect inflationary pressures to increase throughout 2026 due, in part, to the Iran Conflict, although there continues to be significant uncertainty. We continue to take measures to mitigate the impact of this inflation through efficiency initiatives, pricing actions, alternative sourcing, and hedging strategies. However, there has been, and we expect that there could continue to be, a difference between the timing of when these beneficial, mitigative actions impact our results of operations and when the cost inflation is incurred. Additionally, the pricing actions we have taken have, in some instances, negatively impacted, and could continue to negatively impact, our market share.

Throughout 2025, we experienced increased inflationary pressures in our supply chain costs due to the tariff and trade policy actions taken by the United States. On February 20, 2026, the U.S. Supreme Court invalidated those tariffs imposed by the Trump Administration under the International Emergency Economic Power Act ("“IEEPA"”). In response to the Supreme Court's decision, the Trump Administration announced a new 10% global tariff under a different statutory authority,authority; however, there remains uncertainty regarding the duration, scope, and likelihood of further legal challenges of the newly initiated tariffs.

Further, on March 4, 2026, the Court of International Trade ordered the Trump Administration to begin refunding all tariffs imposed under IEEPA. Kraft Heinz is not the Importer of Record for the majority of the raw materials we source from outside of the U.S. As a result, any recovery is dependent on the actions of our suppliers and the contractually negotiated outcomes with these suppliers. Therefore, the timing and the amount of recovery, if any,recovery are uncertain at this time.

On February 28, 2026, the United States and Israel launched a joint military operation against Iran targeting the country's leadership, nuclear facilities, missile sites, and security forces. In response, Iran launched retaliatory strikes against Israel, Saudi Arabia, United Arab Emirates, and other countries in the Persian Gulf region. As of MarchJune 28,27, 2026, less than 1% of consolidated total assets were located in the impacted countries, and less than 1% of consolidated net sales were generated by our businesses in the region. While the Iran conflict did not have a material impact on our results of operations through the firstsecond quarter of 2026, the ongoing geopolitical tensions involving Iran have increased, and could continue to increase, the risk of supply-chain disruption and inflationary pressures, particularly related to procurement and logistics costs. As the situation is rapidly changing, we will continue to evaluate the potential impact that this conflict has on our business.

On July 4, 2025, the One Big Beautiful Bill Act ("“OBBBA"”) was signed into law in the United States. The OBBBA includes a broad range of changes to U.S. tax law, which did not have a material impact on our total tax provision as of MarchJune 28,27, 2026, and we do not expect the elective provisions of the law to have a material impact on our effective tax rate in future periods. Further, certain provision of the OBBBA impact the timing of cash tax payments, which resulted in a reduction of our cash tax payments in 2025, and is expected to reduce cash tax payments in 2026;2026, howeverHowever, we do not expect these provisions to have a material impact on our cash flows in future periods.

The OBBBA also enacted modifications to the Supplemental Nutrition Assistance Program (“SNAP”). As of the firstsecond quarter of 2026, the modifications have resulted in a reduction of the number of SNAP participants and the average benefits received by the eligible participants, which has, and may continue to have, a negative impact on consumers’ demand for our products. While we have taken measures to attempt to mitigate these negative impacts, these modifications to the SNAP program may continue to have a negative impact on our results of operations, cash flows, and market share.

On September 2, 2025, we announced a plan to separate the Company into two independent, publicly traded companies through a tax-free spin-off (the “Separation”). On February 11, 2026, we announced that the Kraft Heinz Board of Directors (the “Board”) has decided to pause work related to the Separation. If work related to the Separation is resumed, the Separation would be subject to the satisfaction of customary conditions, including final approval by the Board, receipt of favorable tax opinions of our U.S. tax advisors with respect to the tax-free nature of the Separation, and the effectiveness of appropriate filings with the U.S. Securities and Exchange Commission. The timing of the Separation and whether it will be completed is uncertain and we cannot assure that the Separation will be completed on the anticipated timeline or at all or that the terms of the Separation will not change. We incurred $56$10 million of separation costs for the three months ended MarchJune 28,27, 2026, primarily related to employee-related and technology costs. We incurred $66 million of separation costs for the six months ended June 27, 2026, primarily related to consulting, advisoryadvisory, employee-related, and employee-relatedtechnology costs. These costs were recognized in SG&A on our consolidated statements of income.

Net sales increaseddecreased 0.8%1.4% to $6.0$6.3 billion for the three months ended MarchJune 28,27, 2026 compared to $6.0$6.4 billion for the three months ended MarchJune 29,28, 2025, including the favorable impact of foreign currency (1.90.5 pp) and unfavorable impact of acquisitions and divestitures (0.70.6 pp). Organic Net Sales decreased 0.4%1.3% to $5.9$6.2 billion for the three months ended MarchJune 28,27, 2026 compared to $5.9$6.3 billion for the three months ended MarchJune 29,28, 2025, primarily due to the unfavorable volume/mix (1.22.6 pp), which more than offset higher pricing (0.81.3 pp). Pricing was higher in each segment. Volume/mix in North America and International Developed Markets was unfavorableunfavorable, while volume/mix in eachEmerging segment.Markets was favorable.

Operating income/(loss) decreased 4.3%19.4% to incomea loss of $1.1$6.4 billion for the three months ended MarchJune 28,27, 2026 compared to incomea loss of $1.2$8.0 billion for the three months ended MarchJune 29,28, 2025, primarily due to non-cash impairment losses that were $1.9 billion lower in the current year period. In addition to the impact of these non-cash impairment losses, operating income/(loss) decreased by $371 million driven by unfavorable changes in unrealized losses/(gains) on commodity hedges, increased advertising expenses, unfavorable volume/mix, inflationary pressures in manufacturing and logistics costs that outpaced our efficiency initiatives, separationand costshigher incurredvariable in the current year period,compensation and increasedrelated restructuringtax costs.expense. These unfavorable impacts to operating income/(loss) were partially offset by favorablehigher changespricing and efficiency initiatives in unrealized losses/(gains) on commodity hedges, higher pricing, and certain nonrecurring procurement costthat recoveries.outpaced inflationary pressures.

Net income/(loss) increaseddecreased 11.9%30.2% to incomea loss of $799$5.5 millionbillion for the three months ended MarchJune 28,27, 2026 compared to incomea loss of $714$7.8 millionbillion for the three months ended MarchJune 29,28, 2025. This increasedecrease was primarilydue driven by lower income tax expense and favorable changes in other expense/(income), partially offset byto the unfavorablefavorable changes in operating income/(loss) factors discussed aboveabove, lower income tax expense, and higherlower interest expense.expense, partially offset by unfavorable changes in other expense/(income).

•Our effective tax rate for the three months ended MarchJune 28,27, 2026 was ana expensebenefit of 20.9%14.4% on pre-tax income,loss, comparedwhich toincluded anthe expensenet unfavorable effective tax rate impact of 29.9%goodwill and intangible asset impairment losses of 9.0%. Our effective tax rate for the three months ended MarchJune 29,28, 2025.2025 was a benefit of 4.2% on pre-tax loss. The year-over-year change in the effective tax rate for the three-month period was primarily driven by certain favorable discrete income tax items, including the tax benefit on the Italy Infant Transaction, the revaluation of deferred tax balances due to changesthe impact of non-deductible goodwill impairments and a more favorable geographic mix of pre-tax income in U.S. state tax rates, and the reversal of uncertain tax position reserves in certain U.S. states andvarious non-U.S. jurisdictions.

•OtherInterest expense/(income) was $101$31 million of income for the three months ended MarchJune 28,27, 2026 compared to $51$240 million of incomeexpense for the three months ended MarchJune 29,28, 2025. This change was primarily driven by a $41$265 million favorablegain changeon extinguishment of debt in netconnection pension and postretirement non-service benefits related towith the settlementTender of our U.S. Retiree Life Insurance Plan in the first quarter of 2026 and a $19 million increase in interest income.Offer.

Adjusted Operating Income decreased 11.8%18.4% to $1.1$1.0 billion for the three months ended MarchJune 28,27, 2026 compared to $1.2$1.3 billion for the three months ended MarchJune 29,28, 2025, primarily due to increased advertising expenses, unfavorable volume/mix, inflationary pressures in manufacturing and logistics costs that outpaced our efficiency initiatives, and unfavorablehigher volume/mix.variable compensation and related tax expenses. These unfavorable impacts more than offset higher pricing,pricing certainand nonrecurringefficiency initiatives in procurement costthat recoveries,outpaced andinflationary the favorable impact of foreign currency (0.7 pp).pressures.

Diluted EPS increased 13.6%30.3% to $0.67$(4.60) for the three months ended MarchJune 28,27, 2026 compared to $0.59$(6.60) for the three months ended MarchJune 29,28, 2025, primarily due to the net income/(loss) factors discussed above.

Adjusted EPS decreased 6.5%18.8% to $0.58$0.56 for the three months ended MarchJune 28,27, 2026 compared to $0.62$0.69 for the three months ended MarchJune 29,28, 2025. This decrease was primarily due to lower Adjusted Operating Income, which more than offset lower taxes on adjusted earnings.

Management evaluates segment performance based on several factors, including net sales, Organic Net Sales, and Segment Adjusted Operating Income. Segment Adjusted Operating Income is defined as operating income/(loss) excluding, when they occur, the impacts of restructuring activities, deal costs, unrealized gains/(losses) on commodity hedges (the unrealized gains and losses are recorded in general corporate expenses until realized; once realized, the gains and losses are recorded in the applicable segment’s operating results), impairment losses, separation costs, and certain non-ordinary course legal and regulatory matters. Segment Adjusted Operating Income for Emerging Markets, which represents the aggregation of our WEEM and AEM operating segments, is defined and presented consistently with the Segment Adjusted Operating Income of our reportable segments —segments, North America and International Developed Markets. Segment Adjusted Operating Income is a financial measure that can assist management and investors in comparing our performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our underlying operations. Management also uses Segment Adjusted Operating Income to allocate resources.

Drivers of the changes in net sales and Organic Net Sales for the three and six months ended MarchJune 28,27, 2026 compared to the three and six months ended MarchJune 29,28, 2025 were:

Net sales decreased 0.7%2.7% to $4.5$4.6 billion for the three months ended MarchJune 28,27, 2026 compared to $4.5$4.8 billion for the three months ended MarchJune 29,28, 2025. Organic Net Sales decreased 1.1%2.7% to $4.4$4.6 billion for the three months ended MarchJune 28,27, 2026 compared to $4.5$4.8 billion for the three months ended MarchJune 29,28, 2025, primarily due to unfavorable volume/mix (1.53.8 pp), which more than offset higher pricing (0.41.1 pp). Unfavorable volume/mix was primarily due to declines in coffee,meats, cold cuts, powdered beverages,spreads, and frozen snacks, which more than offset the favorable impact to certain categories as a result of the shift in Easter timing. Higher pricing was taken in certain categories to mitigate higher input costs, primarily in coffee.cheese.

Segment Adjusted Operating Income decreased 11.6%15.8% to $1.0 billion for the three months ended MarchJune 28,27, 2026 compared to $1.1$1.2 billion for the three months ended MarchJune 29,28, 2025, primarily due to unfavorable volume/mix, increased advertising expenses, inflationary pressures in manufacturing and logistics costs that outpaced our efficiency initiatives, increasedand advertisinghigher expenses,variable compensation and unfavorablerelated volume/mix.tax expenses. These unfavorable impacts to Segment Adjusted Operating Income more than offset certainhigher nonrecurringpricing and efficiency initiatives in procurement costthat recoveries,outpaced higherinflationary pricing, and the favorable impact of foreign currency (0.3 pp).pressures.

Net sales increaseddecreased 3.2%3.5% to $843$865 million for the three months ended MarchJune 28,27, 2026 compared to $817$897 million for the three months ended MarchJune 29,28, 2025, including the favorable impacts of foreign currency (7.92.1 pp) and unfavorable impact of acquisitions and divestitures (4.64.9 pp). Organic Net Sales decreased 0.1%0.7% to $779$846 million for the three months ended MarchJune 28,27, 2026 compared to $780$852 million for the three months ended MarchJune 29,28, 2025, primarily due to unfavorable volume/mix (0.31.4 pp), which more than offset higher pricing (0.20.7 pp). Unfavorable volume/mix was primarily driven by Australia and Western Europe regions, due to a temporary pause in shipments duepart to negotiations with certain customers within our Western Europe and Australia regions,customers, which more than offset favorable volume/mix in France, Benelux and the United Kingdom.

Segment Adjusted Operating Income increaseddecreased 4.9%9.1% to $133$124 million for the three months ended MarchJune 28,27, 2026 compared to $127$136 million for the three months ended MarchJune 29,28, 2025, primarily driven by theincreased favorableSG&A, impactincluding ofadvertising foreign currency (7.0 pp)expenses and decreasedvariable procurementcompensation costs,and whichrelated moretax thanexpenses, offsetand theinflationary decreasepressures in manufacturing and logistics costs that outpaced our efficiency initiatives. These unfavorable impacts to Segment Adjusted Operating Income resultingmore fromthan theoffset Italyefficiency Infantinitiatives Transactionin andprocurement increasedthat advertisingoutpaced expenses.inflationary pressures.

Net sales increased 7.6%10.4% to $746$771 million for the three months ended MarchJune 28,27, 2026 compared to $694$698 million for the three months ended MarchJune 29,28, 2025, including the favorable impacts of foreign currency (3.81.9 pp). Organic Net Sales increased 3.8%8.5% to $702$735 million for the three months ended MarchJune 28,27, 2026 compared to $676$678 million for the three months ended MarchJune 29,28, 2025, primarily driven by higher pricing (4.44.5 pp), whichand more than offset unfavorablefavorable volume/mix (0.64.0 pp). Higher pricingPricing was taken primarilyhigher in certain countries within WEEM to address inflationary pressures. UnfavorableFavorable volume/mix was primarily driven by Brazil, Venezuela, and China, which more than offset unfavorable volume/mix in Indonesia.

Segment Adjusted Operating Income decreasedincreased 4.0%6.7% to $95$107 million for the three months ended MarchJune 28,27, 2026 compared to $99$100 million for the three months ended MarchJune 29,28, 2025, primarily due to inflationaryhigher pressurespricing, inindirect procurementtax recoveries within Brazil, and manufacturingfavorable costs that outpaced our efficiency initiatives, increased SG&A due, in part, to increased headcount in our sales and marketing teams, and increased advertising expenses.volume/mix. These unfavorablefavorable impacts to Segment Adjusted Operating Income more than offset increased inflationary pressures in procurement, manufacturing, and logistics costs that outpaced our efficiency initiatives, advertising expenses, and higher pricing.variable compensation and related tax expenses.

Cash Flow Activity for the ThreeSix Months Ended MarchJune 28,27, 2026 Compared to the ThreeSix Months Ended MarchJune 29,28, 2025:

Net cash provided by operating activities was $1.0$2.1 billion for the threesix months ended MarchJune 28,27, 2026 compared to $720$1.9 millionbillion for the threesix months ended MarchJune 29,28, 2025. This increase was primarily driven by favorable changes in working capital, primarily within accounts payable, due, in part, to inventory optimization efforts and improved supplier payment terms,terms aspartially welloffset asby favorable changesincreases in collateral receipts related to our commodity derivative margin requirements.inventory. These impacts were partially offset by lower Adjusted Operating Income.

Net cash provided by investing activities was $185$551 million for the threesix months ended MarchJune 28,27, 2026 compared to net cash used for investing activities of $878$1.3 millionbillion for the threesix months ended MarchJune 29,28, 2025. This change was primarily driven by higher purchases of marketable securities in the prior year period, proceeds received on the sale of marketable securities in 2026, and proceeds received in connection with the close of the Italy Infant Transaction. We expect 2026 capital expenditures to be approximately $900$850 million compared to the 2025 capital expenditures of $801 million. Our 2026 capital expenditures are expected to be primarily driven by maintenance projects, investments in technology, and capital investments focused on generating growth, and investments in technology.growth.

Net cash used for financing activities was $512$2.9 millionbillion for the threesix months ended MarchJune 28,27, 2026 compared to net cash providedused byfor financing activities of $900$423 million for the threesix months ended MarchJune 29,28, 2025. This change was primarily driven by higher debt repayments in the current year period, and lower debt proceeds received from the issuance of the 2026 Notes in the current year period compared to 2025 Notes in the prior year period,period. This change was partially offset by decreased repurchases of common stock compared to the prior year period. See Note 14, Commitments, Contingencies, and Debt, in Item 1, Financial Statements for additional information on our debt repayments.

Of the $3.3$2.4 billion cash and cash equivalents on our condensed consolidated balance sheet at MarchJune 28,27, 2026, $935$1.1 millionbillion was held by international subsidiaries.

In order to manage our cash flow and related liquidity, we work with our suppliers to optimize our terms and conditions, which include the extension of payment terms. We maintain agreements with third-party administrators that allow participating suppliers to track payment obligations from us, and, at the sole discretion of the supplier, sell one or more of those payment obligations to participating financial institutions. Our obligations to our suppliers, including amounts due and scheduled payment terms, are not impacted. Our current payment terms with our suppliers, which we deem to be commercially reasonable, generally range from 0 to 250 days. All amounts due to participating suppliers are paid to the third party on the original invoice due dates, regardless of whether a particular invoice was sold. The amounts confirmed outstanding under these programs were $756$868 million at MarchJune 28,27, 2026 and $755 million at December 27, 2025. The amounts were included in accounts payable on our consolidated balance sheets. See Note 13, Financing Arrangements, in Item 1, Financial Statements, for additional information on our trade payables programs.

From time to time, we obtain funding through our commercial paper programs. We had no commercial paper outstanding at MarchJune 28,27, 2026, at December 27, 2025, or during the threesix months ended MarchJune 28,27, 2026 or MarchJune 29,28, 2025.

No amounts were drawn on our Senior Credit Facility at MarchJune 28,27, 2026 or December 27, 2025, or during the threesix months ended MarchJune 28,27, 2026 or MarchJune 29,28, 2025.

Our credit agreement contains customary representations, warranties, and covenants that are typical for these types of facilities and could, upon the occurrence of certain events of default, restrict our ability to access our Senior Credit Facility. We were in compliance with all financial covenants as of MarchJune 28,27, 2026.

Our long-term debt, including the current portion, was $21.1$19.0 billion at MarchJune 28,27, 2026 and $21.2 billion at December 27, 2025. This decrease was primarily duerelated to the repayment of our $1.9 billion senior notes due June 2026, the purchase of approximately $1.4 billion aggregate principal amount of the 2046 Notes that was validly tendered in May 2026, and changes in foreign currency exchange rates on our foreign-denominated debt.debt which was partially offset by the issuance of the 2026 Notes. We used available-for-sale securities to repay the senior notes that matured in June 2026 and used the net proceeds from the 2026 Notes to fund the Tender Offer.

In the firstsecond quarter of 2025,2026, KHFC, our 100% owned operating subsidiary, issued 600500 million euro aggregate principal amount of 3.250%3.500% senior notes due MarchMay 2033,2031, $500and 500 million euro aggregate principal amount of 5.200%3.950% senior notes due March 2032, and $500 million aggregate principal amount of 5.400% senior notes due March 2035 (collectively, the “2025 Notes”). We used a portion of the net proceeds from the 2025 Notes to fund the 600 million euro senior notes that matured in May 2025 and for general corporate purposes, including our investment in certain marketable fixed-income debt securities that are classified as available-for-sale.2034.

Our long-term debt contains customary representations, covenants, and events of default. We were in compliance with all financial covenants as of MarchJune 28,27, 2026.

We paid dividends on our common stock of $474$949 million for the threesix months ended MarchJune 28,27, 2026. Additionally, in the second quarter of 2026, our Board of Directors declared a cash dividend of $0.40 per share of common stock, which is payable on JuneSeptember 26,25, 2026 to stockholders of record on JuneSeptember 5,4, 2026.

On November 27, 2023, we announced that the Board of Directors approved a share repurchase program authorizing the Company to purchase up to $3.0 billion, exclusive of fees, of the Company’s common stock through December 26, 2026. We are not obligated to repurchase any specific number of shares and the program may be modified, suspended, or discontinued at any time. Under the program, shares may be repurchased in open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), privately negotiated transactions, transactions structured through investment banking institutions, or other means. We purchased no shares during the three and six months ended MarchJune 28,27, 2026 and had approximately $1.5 billion remaining authorization under the share repurchase program as of MarchJune 28,27, 2026. The share repurchase program is in addition to our share repurchases to offset the dilutive effect of equity-based compensation.