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

Our business operations are subject to the cyclical and volatile nature of the supply-demand balance in the chemical industry. Our future operating results are expected to continue to be affected by this cyclicality and volatility. The chemical industry historically has experienced alternating periods of capacity shortages, causing prices and profit margins to increase, followed by periods of excess capacity, resulting in oversupply, declining capacity utilization rates and declining prices and profit margins. While we are exiting the refining business in the first quarter of 2025, we expect to experience similar volatility in that industry until closure of our Houston refinery.

New capacity additions around the world mayhave leadled to periods of oversupply and lower profitability. The timing and extent of any changes to currently prevailing market conditions are uncertain and supply and demand may be unbalanced at any time. As a consequence, we are unable to accurately predict the extent or duration of future industry cycles or their effect on our business, financial condition or results of operations.

For some of our raw materials and utilities there are a limited number of suppliers, and in some cases, the supplies are specific to the particular geographic region in which a facility is located. It is also common in the chemical industry for a facility to have a sole, dedicated source for its utilities, such as steam, electricity and gas. Having a sole or limited number of suppliers may limit our negotiating power, particularly in the case of rising raw material costs. Any new supply agreements we enter into may not have terms as favorable as those contained in our current supply agreements. The reliance on single or limited suppliers heightens our vulnerability to supply chain interruptions, and the closure of such a supplier could cause us to be unable to profitably operate our assets. For example, our ability to operate our site in Brindisi, Italy, may be negatively impacted by the potential shutdown of its propylene supplier.

Our business is capital intensive and we rely on cash generated from operations and external financing to fund our growthgrowth, dividends, and ongoing capital needs. Limitations on access to external financing could adversely affect our operating results.

We require significant capital to operate our current business and fund our dividends, share repurchases, and growth strategy. Moreover, interest payments, dividends, capital requirements of our joint ventures, the expansion of our current business or other business opportunities may require significant amounts of capital. If we need external financing, our access to credit markets and pricing of our capital is dependent upon maintaining sufficientour credit ratings from credit rating agencies and the state of the capital markets generally. There can be no assurances that we would be able to incur indebtedness on terms we deem acceptable, and it is possible that the cost of any financings could increase significantly, thereby increasing our expenses and decreasing our net income. If we are unable to generate sufficient cash flow or raise adequate external financing, including as a result of significant disruptions in the global credit markets, we could be forced to restrict our operationsoperations, lower or suspend our dividends or reduce share repurchases, and not pursue growth opportunities, which could adversely affect our operating results.results and shareholder returns.

We may use our $3,750 million revolving credit facility, which backs our commercial paper program, to meet our cash needs, to the extent available. As of December 31, 2024,2025, we had no borrowings or letters of credit outstanding under the facility and no borrowings outstanding under our commercial paper program, leaving an unused and available credit capacity of $3,750 million. We may also meet our cash needs by selling receivables under our $900 million U.S. Receivables Facility. As of December 31, 2024,2025, we had no borrowing or letters of credit outstanding and availability of $900 million under this facility. In the event of a default under our credit facilities or any of our senior notes, we could be required to immediately repay all outstanding borrowings and make cash deposits as collateral for all obligations the facility supports, which we may not be able to do. Any default under any of our credit arrangements could cause a default under many of our other credit agreements and debt instruments. Without waivers from lenders party to those agreements, any such default could have a material adverse effect on our ability to continue to operate.

Failure to appropriately manage occupational safety, process safety, product safety, human health, product liability and environmental risks inherent in the chemical and refining businessesbusiness and associated with our products, product life cycles and production processes could result in unexpected incidents including releases, fires, or explosions resulting in personal injury, loss of life, environmental damage, loss of revenue, legal liability, and/or operational disruption. Public perception of the risks associated with our products and production processes could impact product acceptance and influence the regulatory environment in which we operate. While we have management systems, procedures and controls to manage these risks, issues could be created by events outside of our control, including natural disasters, severe weather events and acts of sabotage.

We own and operate large-scale facilities. Our operating results are dependent on the continued operation of our various production facilities and the ability to complete construction and maintenance projects on schedule. Interruptions at our facilities may materially reduce the productivity and profitability of a particular manufacturing facility, or our business as a whole, during and after the period of such operational difficulties. In recent years, we have had to temporarily shut down plants on the U.S. Gulf Coast as a result of various hurricanes and cold weather events strikingimpacting Texas and Louisiana.

Our operations are subject to hazards inherent in chemical manufacturing and refining and the related storage and transportation of raw materials, products and wastes. These potential hazards include:

Delays or cost increases related to capital spending programs involving engineering, procurement and construction of facilities could materially adversely affect our ability to achieve forecasted internal rates of return and operating results, or impair our ability to meet our sustainability or other targets or goals. For example, higher costs arising from delaying construction of our PO/TBA plant in Houston increased our costs and impacted our projected rate of return on the project. We are currently constructing our first commercial-scale chemical recycling facility using our MoReTec technology, located at our site in Wesseling, Germany. Building a commercial-scale facility utilizing a new technology can face technical and other challenges resulting in increased costs. In 2025, we announced the deferral of construction on our Flex-2 project in Channelview to preserve capital during the market downturn and also postponed the final investment decision on certain projects, such as MoReTec-2, which could result in increased costs. Delays in making required changes or upgrades to our facilities could subject us to fines or penalties as well as affect our ability to contract with our customers and supply certain products we produce. Such delays or cost increases may arise as a result of unpredictable factors, many of which are beyond our control, including:

A portion of our operations are conducted through joint ventures or equity investments, where control may be exercised by or shared with unaffiliated third parties. We cannot control the actions or ownership of these partners, including any nonperformance, default or bankruptcy of the joint venture or its partners. The joint ventures that we do not controloperate may also lack financial reporting systems to provide adequate and timely information for our reporting purposes. In addition, a joint venture may lack adequate cybersecurity protections or other controls that could impact its ability to reliably conduct operations.

Our joint venture partners may have different interests or goals than we do and may take actions contrary to our requests, policies or objectives. Differences in views among the joint venture participantspartners also may result in delayed decisions or in failures to agree on major matters, potentially adversely affecting the business and operations of the joint ventures and in turn our business and operations. We may develop a dispute with any of our partners over decisions affecting the venture that may result in litigation, arbitration or some other form of dispute resolution. If a joint venture participant acts contrary to our interest, or is unsuccessful in conducting its business, it could harm our brand, business, results of operations and financial condition.

Sustained unfavorable market conditions may also result in asset impairments. For example, in 2024,the challengingthird quarter of 2025, a prolonged downturn in, and outlook for, the European petrochemical and global automotive industries, combined with the sustained decline in our market conditions in Europecapitalization, resulted in a $837 million non-cash impairment charges of property,$1,182 plantmillion, presented in both Goodwill impairments and equipmentOther inimpairments ouron O&P-EAIthe segment.Consolidated Statements of Income (Loss).

Any decision to permanently close facilities or exit a business may result in impairment and other charges to earnings. For example, in AprilMarch 2022,2025, we announced the Financepermanent Committeeclosure of the BoardPO/SM ofproduction Directorsunit ofat the CompanyMaasvlakte approvedsite in the Netherlands, a planjoint toventure exitbetween theus refiningand business,Covestro, resulting in the recognition of $179 million, $334$126 million and $187 million of expense in 2024,shutdown 2023costs andduring 2022,the respectively.year ended December 31, 2025.

We continually evaluate the performance and strategic fit of all of our businesses and evaluate whether our businesses would benefit from acquisitions to enhance growth or dispositions that would align our footprint with our overall business strategy. These transactions pose risks and challenges that could negatively impact our business and financial statements. In 2024,2025, we launchedagreed ato strategicsell reviewcertain European olefins and polyolefins assets and the associated business. The sites to be sold are located in Berre l’Etang (France), Münchsmünster (Germany), Carrington (United Kingdom), and Tarragona (Spain), and closing is expected in the second quarter of certain assets in Europe to align our asset base with our strategy.2026.

Dispositions of assets or businesses involve risks, including difficulties in the separation of operations, services, products and personnel, the diversion of management's attention from other business concerns, the disruption of our business, the potential loss of key employees and the retention of uncertain environmental or other contingent liabilities related to the divested business. There can be no assurance that announced dispositions - including our European divestiture - will be successfully completed on the expected timeline or at all, and transactions that are delayed or abandoned may cause additional disruption to the business. In addition, theydispositions may result in significant asset impairment charges, including those related to goodwill and other intangible assets, which could have a material adverse effect on our financial condition and results of operations. In the event we are unable to successfully divest a business or product line, we may be forced to wind down such business or product line, which could materially and adversely affect our results of operations and financial condition.

We cannot assure you that we will be successful in managing these or any other significant risks that we encounter in acquiringdivesting or divestingacquiring a business or product line, and any transaction we undertake could materially and adversely affect our business, financial condition, results of operations and cash flows, and may also result in a diversion of management attention, operational difficulties and losses.

Our results of operations can be materially affected by adverse conditions in the financial markets and depressed economic conditions generally. Economic downturns in the businesses and geographic areas in which we sell our products could substantially reduce demand for our products and result in decreased sales volumes and increased credit risk. Recessionary environments adversely affect our business because demand for our products is reduced, particularly from our customers in industrial markets generally and the automotive and housing industries specifically and may result in higher costs of capital. A significant portion of our revenues and earnings are derived from our business in Europe. In addition, most of our European transactions and assets, including cash and receivables, are denominated in euros.

We operate internationally and are subject to exchange rate fluctuations, exchange controls, tariffs, political risks and other risks relating to international operations.

Our operating results could be negatively affected by the laws, rules and regulations, as well as political environments, in the jurisdictions in which we operate. There could be reduced demand for our products, decreases in the prices at which we can sell our products and disruptions of production or other operations. Trade protection measures such as tariffs, quotas, duties, tariffs, safeguard measures or anti-dumping duties imposed in the countries in which we operate could negatively impact our business. Additionally, there may be substantial capital and other costs to comply with regulations and/or increased security costs or insurance premiums, any of which could reduce our operating results.

We are subject to extensive national, regional, state and local environmental laws, regulations, directives, rules and ordinances concerning pollution, protection of the environment, hazardous materials, health and safety, the security of our facilities, and the safety of our products. WeDespite recent government actions to delay or decrease regulatory obligations in certain jurisdictions, we generally expect that these requirements are likely tomay become more stringent over time.the longer term. Changes to such laws could result in restrictions on our operations, denial of permits, loss of business opportunities, increased operating costs or additional capital expenditures. We could incur significant costs or operational restrictions due to violations of or liabilities under such laws and regulations in the form of fines, penalties, and injunctive relief. Any substantial liability under such laws could have a material adverse effect on our financial condition, results of operations and cash flows. Additionally, we are required to have permits for our businesses and are subject to licensing regulations. These permits and licenses are subject to renewal, modification and in some circumstances, revocation. Further, the permits and licenses are often difficult, time consuming and costly to obtain and could contain conditions that limit our operations.

There has been a broad range of proposed or promulgated international, national and state laws focusing on greenhouse gas (“GHG”) emission reduction and global climate change. These proposed or promulgated laws apply or could apply in countries where we have interests or may have interests in the future. Laws and regulations in this field continue to evolve and, while they are likely to be increasingly widespread and stringent, at this stage it is not possible to accurately estimate either a timetable for implementation or our future compliance costs relating to implementation. Under the 2015 Paris Agreement, parties to the United Nations Framework Convention on Climate Change agreed to undertake ambitious efforts to reduce GHG emissions and strengthen adaptation to the effects of climate change.

Jurisdictions in which we operate, including, in particular, the European Union (“EU”), have prepared national legislation and protection plans to implement their emission reduction commitments under the 2015 Paris Agreement. Our operations in Europe participate in the EU Emissions Trading System (“ETS”) and we meet our obligations through a combination of free and purchased emission allowances. We anticipate that climate regulation in the EU will result in an accelerated reduction of our free allowances, and higher market prices for purchased allowances. TheseIn addition, it remains uncertain whether the EU will implement a carbon border adjustment mechanism for organic chemicals and otherpolymers, futureand, regulationsif couldso, resulthow insuch increaseda costs,mechanism additionalwould capitalaffect expenditures,the orcompetitiveness restrictionsof onour operations.products and our exposure to higher carbon costs.

Although the U.S. announced its intent to withdraw from theinternational Parisclimate Agreementagreements and has taken steps to roll back climate regulations in January 2025,regulations, several state governments have promulgated regulations directed at GHG emissions reductions from certain types of facilities, and additional regulations could be forthcoming,promulgated in the future, that could result in increased operating costs for compliance, required acquisition or trading of emission allowances, or other costs. For example, the states of Vermont and New York have enacted ‘climate superfund’ laws that attempt to impose strict liability on companies that have extracted or refined hydrocarbons that led to emissions of GHG over certain thresholds. Additionally, demand for the products we produce may be reduced.

Assessments under TSCA, REACH or similar programs or regulations in other state or national jurisdictions may result in heightened concerns about the chemicals we use or produce and may result in additional requirements or bans being placed on the production, handling, labeling or use of those chemicals. Such concerns and additional requirements could also increase the cost incurred by our customers to use our chemical products and otherwise limit the use of these products, which could lead to a decrease in demand for these products. Such a decrease in demand could have an adverse impact on our business and results of operations. International regulators, investors, consumers and other stakeholders are focused on environmental, social, and governance (“ESG”)environmental considerations. ESG disclosureDisclosure obligations have required and may continue to require us to implement new practices and reporting processes and have created and will continue to create additional compliance risk. If we are unable to meet our circularity, greenhouse gas reduction, diversity, equity and inclusion,reduction or othergender diversity goals, or if we are perceived by regulators, customers, stockholders or employees to have not responded appropriately to the growing concern for these issues, our reputation, and therefore our ability to sell our products, could be negatively impacted. If, as a result of their assessment of our ESG performance, certain investors are unsatisfied with our actions or progress, they may reconsider their investment in our shares or debt securities. Alternatively, as “anti-ESG” sentiment exists among some individuals and government institutions, we may also face scrutiny, reputational risk, lawsuits or market access restrictions from these parties regarding our ESGsustainability initiatives. Providers of debt and equity financing may also consider our sustainability performance and external ESG ratings, which we have limited ability to influence, which could impact our cost of capital and adversely affect our business.

Potential physical impacts of climate change include increased frequency and severity of hurricanes and floods as well as freezing conditions, tornadoes, and global sea level rise. Although we have preparedness plans in place designed to minimize impacts and enhance safety, should an event occur, it could have the potential to disrupt our supply chain and operations. A number of our facilities are located on the U.S. Gulf Coast, which has been impacted by hurricanes that have required us to temporarily shut down operations at those sites. Our sites rely on rivers and other waterways for transportation that may experience restrictions in times of drought or other unseasonal weather variation. In addition, scarcity of water and drought conditions due to climate change could reduce the availability of fresh water needed to produce our products which could increase our costs of operations.

There is aconcern growing concernglobally with the accumulation of plastic, plastic additives, and microplastics in the environment, particularly in waterways and oceans. Additionally, plastics areface facing increasedsome public backlash and scrutiny, as well as governmental investigations and enforcement, and private litigation. Policy measures to address these concerns are being discussed or implemented by governments at allvarious levels. For example, over the past two years the United Nations Environment Program has been overseeing the development of a new international legally binding instrument on plastic pollution. While these internationalthe negotiations haveended beenin challenging,2025 without reaching an agreement, they demonstrated significant progressinterest hasglobally beenin madeaddressing withthese a goal of finalizing this treaty by the end of 2025.issues. The European Union has been undertaking a series of actions under its Circular Economy Action Plan, including adoption of the Single Use Plastics Directive in 2019, which introduced policy measures for single use plastics including bans, product design requirements, extended producer responsibility obligations, and labeling requirements, and adoption of the Packaging and Packaging Waste Regulation to replace the Packaging and Packaging Waste Directive. In addition, a host of single-use plastic bans, taxes and Extended Producer Responsibility (“EPR”) bills have been passed by countries around the world and states and municipalities throughout the U.S. Consumer deselection, increased regulation of, or prohibition on, the manufacturing or use of plastic or plastic products could limit the use of these products or increase the costs incurred by our customers to use such products, and could lead to a decrease in demand, particularly for fossil-based PE, PP, and other products we make. Such a decrease in demand could adversely affect our business, operating results, and financial condition.

We have set GHG emissions reduction targetsgoals for 2030 and aim to achieve net zero scope 1 and 2 GHG emissions by 2050. In 2026, we updated these goals. Our ability to achieve these updated goals depends on many factors, including the development and availability of technology, our ability to secure permits and emissions credits, project execution risk, the availability of infrastructure, the availability of suppliers, the availability of supportive governmental policiespolicies, industry standards and markets, to evolving regulatory requirements, competitor actions, and customer and consumer preferences. We may also not timely adapt to changes or methods in carbon pricing that could increase our costs and reduce our competitiveness. The cost associated with our GHG emissions reduction goals could be significant. We also participate, along with other companies, institutes, universities, trade associations and other organizations, in various initiatives, campaigns, and other projects that express various ambitions, aspirations and goals related to climate change, emissions and energy transition. Our individual ambitions, future performance or policies may differ from the ambitions of those organizations or the individual ambitions of other participants in these various initiatives, campaigns, and other projects, and we may unilaterally change our own ambitions, aspirations and goals. Failure to achieve our emissions targets could result in reputational harm, enforcement or litigation, changing investor sentiment regarding investment in LyondellBasell or a negative impact on access to and cost of capital.

InWe Septemberhave 2020, we announcedset a 2030 circularity goal offor producing and marketing at least two million metric tons of recycled and renewable-based polymers annually by 2030. Many of our customers also have goals to increase the recycled and renewable content in their own products and packaging. Our ability to achieve thisour goal depends on many factors, including the availability of collection and sortation infrastructure, evolving regulations on chemical recycling and recycled content, customer demand, our ability to grow our CLCS business, established in 2022, make investmentsinvestments, indevelop and deploy new technologies, expand the global footprint of our recycling facilities and joint ventures, secure access to feedstock, and manufacture recycled and low carbon products at commercial scale. In 2024, we began construction on our first industrial-scale chemical recycling plant at our site in Wesseling, Germany, which utilizes our proprietary MoReTec technology, and we may encounter difficulties in the construction or operation of the facility, or the implementation of MoReTec technology at that scale, which could negatively impact our ability to achieve our goals and damage our reputation with customers and other stakeholders.

For example, inIn 2024, we and eight other industry defendants were named as one defendant in two separatea proposed class action casesin Kansas related to industry-wide claims about plastics recyclability. The claimscauses madeof inaction litigation filed in Kansas are related to allegedinclude public nuisance from plastic waste in the environment, and litigation filed in Missouri seeks damages under antitrust, unfair competitioncompetition, consumer protection, and consumerunjust protectionenrichment. laws. Although the Kansas case was subsequently dismissed, the Missouri case is still pending, and itIt is possible that this case and similar cases in the future could result in significant fines or damages, or injunctive action that could adversely affect our ability to conduct our business or negatively impact our financial condition or results of operations.

The discussion summarizing the significant factors affecting the results of operations and financial condition for the year ended December 31, 20222023 and for the year ended December 31, 20232024 compared to 20222023, except as impacted by the change for discontinued operations discussed above, has been excluded from this Form 10-K and can be found in Part II, “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 20232024, which was filed with the Securities and Exchange Commission on February 22,27, 20242025, of which Item 7 is incorporated herein by reference.

We remain committed to our balanced and disciplined capital allocation strategy. During 2024,2025, we generated $3,819$2.3 millionbillion in cash from operating activities,activities. We invested $1,839$1.9 millionbillion in capital expenditures and returned $1,915$2.0 millionbillion to shareholders through dividend payments and share repurchases.

Revenues—Revenues decreased by $805$3,241 million, or 2%,10%, in 2025 compared to 2024. Lower average sales prices for many of our products resulted in an 8% decrease in revenues, while lower sales volumes driven by lower demand led to a 4% decrease. These declines were partially offset by favorable foreign exchange impacts, which led to a 2% increase in revenues. Revenues were relatively flat in 2024 compared to 2023. Lower average sales prices driven by lower demand resulted in a 2% decrease in revenues.

Cost of Sales—Cost of sales remained relatively unchanged, in 2024 compared to 2023. Fluctuations in our cost of sales are generally driven by changes in feedstock and energy costs. OnAfter angiving annualconsideration basis,to the reclassification of the refinery business to discontinued operations, feedstock and energy related costs generally represent approximately 75% to 80%70% of total annual cost of sales.sales over the last three years. Other variable costs account for approximately 10% ofto cost15%, of sales andwhile fixed operating costs, consisting primarily of expenses associatedrelated withto employee compensation, depreciation and amortization, and maintenance, account for the remainder.

Impairments—During 2024, we recognized non-cash impairment charges of $949 million, primarily consisting of impairments of property, plant and equipment of $892 million in our O&P-EAI and APS segments. During 2023, we recognized non-cash impairment charges of $518$507 million, primarily consisting of a $252 million goodwill impairment charge of $252 million in our APS segment and ana $192 million impairment charge of $192 million related to our European PO jointJoint ventureVenture, recognized in our I&D segment. See Notes 7, 8 and 20 to the Consolidated Financial Statements for additional information regarding impairment charges.

SG&A Expenses—Selling, general and administrative (“SG&A”) expenses decreased by $32 million, or 2%, in 2025 compared to 2024, with approximately 70% of the decrease attributable to lower professional fees and the remainder primarily driven by reduced spending on strategic projects. In 2024, SG&A expenses increased by $106$103 million, or 7%, in 2024 compared to 2023, primarily attributabledue to an increase inhigher employee-related expenses.

Operating Income (Loss)—Operating income decreased by $1,236$2,338 million, or 40%,122%, in 20242025 compared to 2023.2024. In 2024,2025, Operatingoperating income decreased for our O&P-EAI,P-Americas, Refining, andAPS, I&D segments by $848 million, $434 million and $311 million, respectively. Operating income for our APS, O&P-Americas and Technology segments increaseddecreased by $213$1,364 million, $140$695 million, $523 million and $4$201 million, respectively, in 2024 compared to 2023.2024. These decreases were partially offset by an increase of $324 million in our O&P EAI segment. Results for each of our business segments are discussed further in the Segment Analysis section below.

Gain (Loss) on Sale of Business—In the second quarter of 2024, we completed the sale of our Ethylene Oxide & Derivatives (“EO&D”) business and associated production facilities located in Bayport, Texas and recognized a pre-tax gain of $284 million. See Note 209 to the Consolidated Financial Statements for additional information.

Loss from Equity Investments—LossesResults from equity investments increased $197by $205 million, or 985%,94%, in 20242025 compared to 2023. Approximately 82% of the change was driven by our O&P-EAI segment,2024, primarily due to the recognitionabsence of a deferred tax valuation allowance charge byand ourequity losses related to a Chinese joint venture. The remaining change was primarily driven by lower polypropylene margins at our Mexican joint venture in our O&P-AmericasP-EAI segment.segment that were recognized in 2024.

Income Taxes—Our effective income tax rates of 15.0%(9.8)% in 2025 and 15.2% in 2024 and 19.1% in 2023 resulted in tax provisionsexpense of $240$70 million and $501$259 million, respectively. The lower effective tax rate for 20242025 was primarily attributable to changes in earnings in countries with varying statutory tax rates, largely attributable to fourththird quarter non-cash impairments decreasing the effective tax rate by 5.5%66.2 percentage points in comparison to 2023.2024. ThereThis decrease was apartially furtheroffset decreaseby increases in the effective tax rate of 1.7% related to fluctuations in foreign exchange gains and losses, partiallycoupled offsetwith bythe anestablishment increaseof invaluation allowances against deferred tax assets, which increased the effective tax rate ofby 2.6%24.4 relatedpercentage topoints reducedand exempt23.2 incomepercentage inpoints, 2024. For additional information, see Note 16 to the Consolidated Financial Statements.respectively.

Comprehensive Income (Loss)—Comprehensive income (loss) decreased by $706$1,827 million in 20242025 compared to 2023,2024, primarily due to a decrease in net income.income (loss). The activities from the remaining components of Comprehensive income (loss) are discussed below.

Financial derivatives designated as cash flow hedges, primarily our commodity swaps, led to ana increasedecrease in Comprehensive income (loss) of $195$137 million in 20242025 compared to 2023,2024, reflecting commodity pricing volatility. Defined benefit pension and other postretirement benefit plans led to an increase in Comprehensive income of $95 million in 2024 compared to 2023, primarily due to actuarial gains resulting from higher-than-expected asset returns offset by a decrease in discount rates. Foreign currency translations decreasedincreased Comprehensive income (loss) by $242$368 million in 20242025 compared to 2023,2024, primarily due to the strengtheningweakening of the U.S. dollar relative to the euro in 2024,2025, partially offset by the effective portion of our net investment hedges. See Notes 13,15, 1416 and 1820 to the Consolidated Financial Statements for further discussions.

We use earningsnet fromincome continuing operations(loss) before interest, income taxes, and depreciation and amortization (“EBITDA”) as our measure of profitability for segment reporting purposes. This measure of segment operating results is used by our chief operating decision maker to assess the performance of, and allocate resources to, our operating segments. Intersegment eliminations and items that are not directly related or allocated to business operations, such as foreign exchange gains or losses and components of pension and other post-retirement benefits other than service costs, are included in “Other.” See the table below for a reconciliation of EBITDA to its nearest generally accepted accounting principles (“GAAP”) measure.

The following table presents the reconciliation of Net Incomeincome (loss) to EBITDA for each of the periods presented:

Our continuing operations are managed through sixfive reportable segments: O&P-Americas, O&P-EAI, I&D, APS, RefiningAPS and Technology. Revenues and other information for the periods presented are reflected in the tables below for our reportable segments:

Overview—EBITDA increaseddecreased in 20242025 relative to 20232024 primarily due to improved olefins margins, partially offset by lower polymer margins.

In calculating the impact of margin and volume on EBITDA, consistent with industry practice, managementwe offsetsoffset revenues and volumes related to ethylene co-products against the cost to produce ethylene. Volume and price impacts of ethylene co-products are reported in margin.

•natural gas liquids (“NGLs”),liquids, principally ethane and propane, the prices of which are generally affected by natural gas prices; and

We have flexibility to vary the raw material mix and process conditions in our U.S. olefins plants in order to maximize profitability as market prices fluctuate for both feedstocks and products. Although prices of crude-based liquids and natural gas liquids are generally related to crude oil and natural gas prices, during specific periods the relationships among these materials and benchmarks may vary significantly. Ethane made up approximately 75% andto 70%80% of the raw materials used in our North American crackers in 20242025 and 2023, respectively.2024.

Revenues—Revenues increaseddecreased by $253$1,732 million, or 2%,15%, in 20242025 compared to 2023.2024. HigherLower average sales prices across most of our productsproducts, driven by a lower oil price environment and ample product supply, resulted in a 5%9% increasedecrease in revenue. Lower co-product volumesvolumes, driven by planned and unplanned outagesoutages, resulted in a 3%6% decrease in revenue.

EBITDA—EBITDA increaseddecreased by $142$1,301 million, or 6%,53%, in 20242025 compared to 2023.2024. HigherLower olefins results led to a 19%36% increasedecrease in EBITDAEBITDA, primarily driven by higherlower margins resulting from highera ethylenedecrease pricesin dueco-product to industry cracker downtime and lower feedstock and energy cost.contribution. Lower polymerpolyethylene results led to a 5%16% decrease in EBITDAEBITDA, primarily due to lowermargin marginscompression reflecting higher monomer cost. During 2024 and 2023, we recognized a LIFO inventory charge of $22 million and benefit of $73 million, respectively, which resulted in a 4% decrease in EBITDA. EBITDA decreased 2% dueattributed to lowerunfavorable incomemacroeconomic from equity investments reflecting lower polypropylene margins at our joint venture in Mexico.conditions.

In calculating the impact of margin and volume on EBITDA, consistent with industry practice, managementwe offsetsoffset revenues and volumes related to ethylene co-products against the cost to produce ethylene. Volume and price impacts of ethylene co-products are reported in margin.

Revenues—Revenues increaseddecreased by $388$640 million, or 4%,6%, in 20242025 compared to 2023.2024. HigherLower average sales pricesprices, andprimarily as a result of a decrease in the price of naphtha, drove an 8% decrease in revenues. Lower volumes each resulted in a 2% increasedecrease in revenuerevenue, primarilyequally due to higherlower demand.demand and unplanned downtime. Favorable foreign exchange impacts resulted in a 4% increase in revenue.

Overview—EBITDA decreased in 20242025 compared to 2023, primarily2024 driven by lower oxyfuels and related products marginsresults, asshutdown costs related to our European PO Joint Venture recognized in 2025, and the absence of a resultgain on sale of lowerour crudeEO&D oilbusiness andrecognized gasolinein pricingthe combinedsecond withquarter lowerof blend premiums.2024.

The following table sets forth selected financial information for the I&D segment including LossIncome (loss) from equity investments, which is a component of EBITDA.

Revenues—Revenues decreased by $662$1,355 million, or 6%,13%, in 20242025 compared to 20232024. driven by lowerLower average sales prices forresulted in a 10% decrease in revenue driven primarily by oxyfuels and related products as a result of lower gasolinecrude crackpricing. spreadsA decline in sales volumes due to the second quarter of 2024 sale of our EO&D business and blendassociated premiums.production facilities resulted in a 4% decrease in revenue. Favorable foreign exchange impacts resulted in a 1% increase in revenue.

The following table sets forth selected financial information for the APS segment including Loss from equity investments, which is a component of EBITDA.segment.

Revenues—Revenues decreased in 20242025 by $64$162 million, or 2%,4%, compared to 20232024. asLower sales volumes resulted in a result4% ofdecrease lowerin revenue stemming from weaker automotive demand. Lower average sales prices.prices resulted in a 2% decrease in revenue. Favorable foreign exchange impacts resulted in a revenue increase of 2%.

During the first quartersix months of 20262026, we usedgenerated $269$483 million of cash from operating activities. We invested $269$539 million in capital projects and returned $224$448 million to shareholders through dividend payments.

Revenues—Revenues decreasedincreased by $480$1,980 million, or 6%,28%, in the firstsecond quarter of 2026 compared to the first quarter of 2025.2026. LowerThis increase was primarily driven by higher average sales prices foracross many ofproducts, ourwhich productsreflected resultedindustry-wide supply constraints stemming from the conflict in the Middle East and contributed to higher revenues by 33%. This increase was partially offset by a 10%5% decrease in revenues.revenues Lowerresulting from lower sales volumes,volumes drivenfollowing bythe reduceddivestiture demand,of ledcertain toEuropean aassets 2%and decreasethe associated businesses in revenues.the Favorablesecond foreignquarter exchangeof impacts led to a 6% increase in revenues.2026.

Cost of Sales—Cost of sales decreasedincreased by $260$643 million, or 4%,10%, in the firstsecond quarter of 2026 compared to the fourthfirst quarter of 2025,2026, anddue byto $632higher million,feedstock orcosts. 9%,For the first six months of 2026 compared to the first quartersix months of 2025.2025, TheseCosts decreasesof weresales decreased by $364 million, or 3%, driven by lower feedstock costs. Further,The year-over-year decrease also reflects $117 million of shutdown costs recognized in the first quarter of 2025, we recognized $117 million in shutdown costs2025 related to the permanent closure of our European PO Joint Venture.

Selling, General and Administrative (“SG&A”) Expenses—SG&A expenses increaseddecreased by $38$24 million, or 10%,6%, in the firstsecond quarter of 2026 compared to the fourthfirst quarter of 2025,2026, primarily drivendue to lower fees related to professional services, and decreased by an$38 increasemillion, or 5%, in the first six months of 2026 compared to the first six months of 2025, attributable to reduced employee-related expenses.expenses as a result of our cash improvement plan.

Operating Income (Loss)—Operating income increased by $327$1,304 million, or 372%,546%, in the firstsecond quarter of 2026 compared to the fourthfirst quarter of 2025.2026. Operating income in our O&P-Americas, O&P-EAI, APSI&D, Technology and I&DAPS segments increased by $174$861 million, $143$226 million, $43$150 million, $56 million and $26$19 million, respectively. These increases were partially offset by a decrease in our Technology segment of $62 million.

Operating income increased by $125$1,383 million, or 110%,347%, in the first quartersix months of 2026 compared to the first quartersix months of 2025. Operating income in our O&P-Americas, I&D, O&P-AmericasP-EAI, APS and APSTechnology segments increased by $127$918 million, $57$244 million, $153 million, $68 million and $21$6 million, respectively. These increases were partially offset by decreases in our O&P-EAI and Technology segments of $45 million $35 million, respectively.

Other Income, Net—Other income decreasedincreased by $55$46 million, or 85%,million in the firstsecond quarter of 2026 compared to the fourthfirst quarter of 2025,2026, largelydriven due toby a $67$52 million gain on the sale of excess European emissions credits recognized in the fourthsecond quarter of 2026. Other income increased by $16 million in the first six months of 2026 compared to the first six months of 2025, due to the gain on sale of excess European emission credits recognized in the second quarter of 2026, partially offset by the absence of a $36 million gain on the sale of precious metals recognized in the second quarter of 2025.

Income Taxes—Our effective income tax rate for the firstsecond quarter of 2026 was (1.5)%29.2% compared to 61.0%(1.5)% for the first quarter of 2025.2026. The lowerhigher effective income tax rate for the firstsecond quarter of 2026 wasis primarily due to foreignthe exchangeimpact lossesof coupledthe withdivestiture aof select European assets and the associated businesses, which is largely nondeductible for tax and recognized discretely in the second quarter of 2026, that increased the effective income tax rate by 14.2 percentage points. A tax benefit associated with a tax refund claim thatrecognized decreasedin the effectivefirst taxquarter rateof by2026 28.6coupled percentage points and 11.4 percentage points, respectively. In addition,with changes in earnings in countries with varying statutory tax rates decreasedincreased the effective income tax rate in the second quarter of 2026 by 17.510.5 percentage points.points and 2.4 percentage points, respectively.

Income (lossLoss) from Discontinued Operations, Net of Tax—Income (loss) from discontinued operations decreased $168$141 million in the first quartersix ofmonths ended June 30, 2026 compared to the first quartersix ofmonths ended June 30, 2025 primarily due to the recognition of a last-in, first-out (“LIFO”) benefit of $196 million, net of tax, for the liquidation of low cost inventory in the first quarter of 2025.

We use net income (loss) before interest, income taxes, and depreciation and amortization (“EBITDA”) as our measure of profitability for segment reporting purposes. This measure of segment operating results is used by our chief operating decision maker to assess the performance of, and allocate resources to, our operating segments. Intersegment eliminations and items that are not directly related or allocated to business operations, such as foreign exchange gains or losses and components of pension and other postretirement benefits other than service costs are included in “Other”. See the table below for a reconciliation of EBITDA to its nearest generally accepted accounting principles (“GAAP”) measure.

The following table presents the reconciliation of Net income (loss) to EBITDA for each of the periods presented:

Overview—EBITDA increased in the firstsecond quarter of 2026 compared to the fourth quarter of 2025 and first quarter of 20252026 largelyand duein the first six months of 2026 compared to the first six months of 2025, driven by higher olefin and polyethylene margins.

Ethylene Raw Materials—We have flexibility to vary the raw material mix and process conditions in our U.S. olefins plants to maximize profitability as market prices fluctuate for both feedstocks and products. Although prices of crude-based liquids and natural gas liquids are generally related to crude oil and natural gas prices, during specific periods the relationships among these materials and benchmarks may vary significantly. In the second and first quarterquarters of 2026,2026 and the first andsix fourth quartersmonths of 2026 and 2025, approximately 75%70% to 80% of the raw materials used in our North American crackers was ethane.

Revenue—Revenues for our O&P-Americas segment increased by $100$1,084 million, or 4%45% in the firstsecond quarter of 2026 compared to the fourth quarter of 2025 and decreased by $44 million, or 2%, in the first three months of 2026 compared to the first quarter of 2026 and increased by $1,100 million, or 23%, in the first six months of 2026 compared to the first six months of 2025.

FirstSecond quarter of 2026 versus first quarter of 20252026—LowerHigher average sales prices drivenfrom by ample marketindustry supply constraints as the conflict in the Middle East extended into the second quarter, resulted in a 5%44% decreaseincrease in revenue. Higher volumes driven by thean absence of planned and unplanned outages resultedincrease in polymers demand led to a 3%1% increase in revenue.

Overview—EBITDA decreased in the firstsecond quarter of 2026 compared to the first quarter of 2026 and in the first six months of 2026 compared to the first six months of 2025, as a result of lowera polymerloss volumeson and lower equity income. In addition, results for the current period reflect impairment charges and transaction‑related costs associated with the saledivestiture of certain European olefins and polyolefins assets and the related business.businesses, slightly offset by improved margins.

Ethylene Raw Materials—In Europe, naphtha is the primary raw material for our ethylene production and represented approximately 65%70% to 85% of the raw materials used in the second and first quarterquarters of 2026,2026 and in the first andsix fourth quartersmonths of 2026 and 2025.

The following table sets forth selected financial information for the O&P-EAI segment including LossIncome (loss) from equity investments, which is a component of EBITDA:

Revenue—Revenues increased by $165$454 million, or 7%,18%, in the first quarter of 2026 compared to the fourth quarter of 2025 and decreased by $99 million, or 4%, in the firstsecond quarter of 2026 compared to the first quarter of 2026 and increased by $152 million, or 3%, in the first six months of 2026 compared to the first six months of 2025.

FirstSecond quarter of 2026 versus fourthfirst quarter of 20252026—Higher volumes resulted in a revenue increase of 3% driven by stronger demand after year end destocking. Higher average sales prices due to constrained supply from the conflict in the Middle East drove a 3%38% increase in revenue. FavorableLower volumes resulted in a revenue decrease of 19% driven by the divestiture of certain European assets. Unfavorable foreign exchange impacts resulted in a 1% increasedecrease in revenue.

First quartersix months of 2026 versus first quartersix months of 2025—Lower demand led to a decrease inHigher average sales prices andas a result of constrained market supply drove an 11% increase in revenue. Lower volumes reducingresulted revenuesin bya 13%decrease andof 2%,14% respectively.due to the divestiture of certain European assets. Favorable foreign exchange impacts resulted in ana 11%6% increase in revenues.

Overview—EBITDA increased in the firstsecond quarter of 2026 compared to the first quarter of 20252026 and in the first six months of 2026 compared to the first six months of 2025, as a result of improved margins for propylene oxide and derivatives, partially offset by a decrease in intermediate chemicals volumes.margins. Additionally, the first quartersix months of 2025 included $117 million of shutdown costs related to our European PO Joint Venture.

Revenue—Revenues decreasedincreased by $93$687 million, or 4%,33%, in the first quarter of 2026 compared to the fourth quarter of 2025 and by $238 million, or 10%, in the firstsecond quarter of 2026 compared to the first quarter of 2026 and by $234 million, or 5%, in the first six months of 2026 compared to the first six months of 2025.

FirstSecond quarter of 2026 versus fourthfirst quarter of 20252026—Sales volumes decreased due to lower demand and unplanned outages resulting in a 7% decrease in revenue. Higher average sales prices resulted indrove a 3%33% increase in revenue primarily due to high octane values in the U.S. Gulf Coast and Europe driven by tight supply.

First quartersix months of 2026 versus first quartersix months of 2025—A decline in sales volumes due to unplanned outages resulted in a 7% decrease in revenues. LowerHigher average sales prices resulted in a 7%14% decreaseincrease in revenue driven primarily by oxyfuels and related products as a result of lowerhigher crude, gasoline crack spreads, and blend premiums. A decline in sales volumes due to unplanned outages resulted in a 11% decrease in revenue. Favorable foreign exchange impacts resulted in a 4%2% increase in revenue.

EBITDA—EBITDA increased by $29$153 million, or 15%,68%, in the first quarter of 2026 compared to the fourth quarter of 2025 and by $130 million, or 138%, in the firstsecond quarter of 2026 compared to the first quarter of 2026 and by $221 million, or 58%, in the first six months of 2026 compared to the first six months of 2025.