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

Global Profitability Improvement Initiatives—The Company’s ability to achieve expected benefits from cost management, efficiency improvements, and profitability initiatives, such as its Fit to Win program,initiative, including expected impacts from production curtailments, reductions in force and furnace closures, could have a material adverse effect on operations and financial condition.

Beginning in 2024, the Company commenced a strategic review of its global profitability and manufacturing footprint, known as its Fit to Win initiative. This programinitiative is focused on the reduction of redundant production capacity and the optimization of its network, as well as streamlining other costs, such as selling, general and administrative expenses. ThisIn connection with the Fit to Win initiative, in the second quarter of 2025, the Company decided to halt further MAGMA development and operations. With the halt of the MAGMA program, the Company’s Fit to Win initiative is now intended to be the primary program to drive higher output at lower operating costs. The Fit to Win initiative is currently expected to last at least through 2025.2026.

Global Economic and Legal Environment—The global credit, financialfinancial, political, economic and economiclegal environment could have a material adverse effect on operations and financial condition.

The global credit, financialfinancial, political, economic and economiclegal environment can be negatively impacted by numerous events or occurrences, including political events, trade policies and disputes, acts of terrorism, hostilities or wars, natural disasters and public health issues, such as a pandemic. For example, the current conflicts between Russia and Ukraine and Hamas and Israel, as well as any further escalation or expansion of these conflicts, and any related economic sanctions or other impacts could adversely impact the global credit, financialfinancial, economic and economiclegal environment, which could have a material adverse effect on the Company’s operations, including the following:

●Unfavorable macroeconomic conditions, such as a recession or continued slowed economic growth,growth and uncertainty surrounding international trade policies and regulations, changes in U.S. immigration policies, as well as disputes and protectionist measures, could negatively affect consumer demand for the Company’s products;

●Cost inflationinflation, including as a result of imposition of or increase in tariffs, could negatively impact the Company’s costs for energy, labor, materials and services, and impact the Company’s profitability if increased costs are not fully passed on to customers through increased prices of the Company’s products;

●Volatile market performance could affect the fair value of the Company’s pension assets and liabilities, potentially requiring the Company to make significant additional contributions to its pension plans to maintain prescribed funding levelslevels, and may lead to adverse changes in the availability, terms and cost of capital;

●The deterioration of any of the lending parties under the Company’s revolving credit facility or the creditworthiness of the counterparties to the Company’s derivative transactions could result in such parties’ failure to satisfy their obligations under their arrangements with the Company; and

●A significant weakening of the Company’s financial position or results of operations could result in noncompliance with the covenants under the Company’s indebtedness.indebtedness; and

For example, the current conflict between Russia and Ukraine has caused a significant increase in the price of natural gas and increased price volatility. Natural gas forms the primary energy source for the Company’s European operations, and a significant amount of natural gas in Europe is ultimately sourced from Russia. The Company’s European operations typically purchase natural gas under mid- to long-term supply arrangements with terms that range from one to three years andand, through these agreementsagreements, typically agree on a portion of the price with the relevant supplier in advance of the period in which the natural gas will be delivered, which shields the Company from the full impact of increased natural gas prices, while such agreements remain in effect. However, if new agreements are entered into during periods when prices have increased, this would lead to cost inflation and could impact the Company’s profitability if the Company is not able to pass on these increased costs to customers.

However, the current conflict between Russia and Ukraine and the resulting sanctions, potential sanctions, government-mandated curtailments or government-imposed allocations, tariffs or other adverse repercussions on energy supplies could cause the Company’s energy suppliers to be unable or unwilling to deliver natural gas at agreed prices and quantities. If this occurs, the Company may need to procure natural gas at then-current market prices, subject to market availability, which could cause the Company to experience a significant increase in operating costs or result in the temporary or permanent cessation of delivery of natural gas to several of the Company’s manufacturing plants in Europe. Alternatively, for certain plants that have energy switching capabilities, the Company may decide to switch to a different energy source, which could also result in a significant increase in operating costs. In addition, depending on the duration and ultimate outcome of the conflict between Russia and Ukraine, future long-term supply arrangements for natural gas may not be available at reasonable prices or at all. The occurrence of any of the foregoing could have a material adverse effect on the Company’s consolidated assets or results of operations.

Competition—The Company faces intense competition from other glass container producers,producers as well as fromand makers of alternative forms of packaging.packaging, as well as consolidation among competitors. Competitive pressures could adversely affect the Company’s financial health.

Changes in consumer preferences for the food and beverages they consume, changes in customer inventory management practices and down-tradingchanges to products packaged in other substrates (especially during inflationary periods) have reduced and may continue to reduce demand for the Company’s products. Because many of the Company’s products are used to package consumer goods, the Company’s sales and profitability have been, and could continue to be, negatively impacted by changes in consumer purchasing preferences for those products, as well as changes in customer inventory management practices. Examples of such changes include, but are not limited to, lower sales of major domestic beer brands, shifts from beer to wine or spirits that results in the use of fewer glass containerscontainers, lower alcohol consumption and customer destocking to adjust inventory management practices. In periods of lower demand or when customers are destocking, the Company’s sales and production levels have decreased. For example, duringsince 2023 and 2024,2023, the Company has experienced elevated inventory destocking across the value chain, especially related to wine, spirits and beer customers, and soft consumer consumption activity, which negatively impacted the Company’s glass container shipments. The occurrence of any of the foregoing could have a material adverse effect on the Company’s business, financial condition, results of operations and cash flows.

NewImprovements to Glass Melting TechnologiesTechnology—The Company’s inability to develop or applyimprove new glass melting technology, includingtechnology in a cost-effective manner that achieves economic profitability within a reasonable timeframe in addition to successfully achieving key production and commercialintroduce milestones,productivity, process and network optimization actions may affect its ability to transition to lower-carbon processes and competitiveness.

IfThe Company’s success depends partially on its ability to improve its glass melting technology and introduce productivity processes and network optimization actions that lead to the emission of less carbon. As the result of the Company’s decision to halt further MAGMA development and operations in the second quarter of 2025, the Company’s future spending on research, development and engineering activities is expected to significantly decline. However, if the Company is unable to continue to improve thisits glass melting technology through research and development or licensing of new technology, or implement such technology in a mannercost-effective that achieves economic profitability within a reasonable timeframe in addition to successfully achieving key production and commercial milestones,manner, the Company may not be able to remain competitive with other packaging manufacturers. As a result, its business, financial condition, results of operations or ability to transition to lower carbon operations could be adversely affected.

Joint Ventures—Failure by joint venture partners to observe their obligations or commit additional capital could have a material adverse effect on operations.

In addition, an increase in labor costs, strikes or other work stoppages, disruptions at the Company’s facilities or other labor disruptions could adversely affect its operations and increase expenses. A number of factors may adversely affect the labor force available to the Company, including unemployment subsidies, the need for enhanced health and safety protocolsprotocols, changes in immigration policies and government regulations in the jurisdictions in which it operates. Increased competition for qualified labor could result in higher compensation costs for the Company, and a continuation of labor shortages, a lack of qualified labor or increased turnover could result in a significant disruption of its operations and/or higher ongoing labor costs. Any of these occurrences could have a material adverse effect on the Company’s consolidated operations.

Goodwill at December 31, 20242025 totaled $1.32$1.49 billion, representing approximately 15%16% of total assets. The Company evaluates goodwill annually (or more frequently if impairment indicators arise) for impairment using the required business valuation methods. These methods include the use of a weighted average cost of capital to calculate the present value of the expected future cash flows of the Company’s reporting units. Future changes in the cost of capital, expected cash flows, or other factors may cause the Company’s goodwill to be impaired, resulting in a non-cash charge against results of operations to write-down goodwill for the amount of the impairment. If a significant write down is required, the charge would have a material adverse effect on the Company’s reported results of operations and net worth. For example, the Company recorded a non-cash impairment charge of $445 million in the fourth quarter of 2023, which was equal to the remaining goodwill balance on North America’s reporting unit. If the Company’s projected future cash flows were lower, or if the assumed weighted average cost of capital were higher, the testing performed in the fourth quarter of 20242025 may have indicated an impairment of the goodwill related to the Company’s two other reporting units. There can be no assurance that anticipated financial results will be achieved, and the goodwill balances remain susceptible to future impairment charges. Any impairment charges that the Company may take in the future could be material to its consolidated results of operations and financial condition.

The Company has a significant amount of debt. As of both December 31, 20242025 and December 31, 2023,2024, the Company had approximately $5.0 billion and $4.9 billion of total debt outstanding, respectively.outstanding.

In addition, existing free trade laws and regulations provide certain beneficial duties and tariffs for qualifying imports and exports, subject to compliance with the applicable classification and other requirements. Changes in laws or policies governing the terms of foreign trade, and in particular increased trade restrictions, tariffs or taxes on imports from countries where the Company manufactures products, such as Mexico and Canada, could have a material adverse effect on its business and financial results. TheIn 2025, the U.S. hasaccelerated recentlya signaledshift its intention to changein U.S. trade policy, including potentially renegotiating or terminating existing trade agreements and leveraging tariffs. In February 2025, the U.S. imposed new and/or additional tariffs on imports from ChinaCanada, China, Mexico and the European Union. Some of these countries subsequently announced retaliatory tariffs. However, during 2025, the amount of the import tariffs and subsequentlythe paused implementationnumber of products subject to tariffs have changed numerous times based on importsaction fromby Canadathe U.S. government, and Mexico.certain Theseof these tariffs have been subsequently suspended or modified. In addition, the United States-Mexico-Canada Agreement (“USMCA”) is subject to renewal in 2026. There can be no assurance that any newly negotiated terms in the USMCA will not adversely affect the Company’s business and the business of its customers. Changes in tariff and trade policies, including new or additional tariffs, as well as a government’s adoption of “buy national” policies or retaliation by another government against such tariffs or policies have introduced, and may havecontinue introducedto introduce, significant uncertainty into the market and may affect the prices of and demand for the Company’s products, which could have a negative impact on the Company’s results of operations.

Many international legislative and regulatory bodies have enacted legislation and begun investigations of the tax practices of multinational companies, and, in the European Union, the tax policies of certain EU member states. One of these efforts has been led by the Organization for Economic Co-operation and Development (“OECD”), an international association of more than 35 countries including the United States. Focus areas include a Minimum Tax Directive including a global minimum tax of 15%, and base erosion and profit shifting, including situations where payments are made between affiliates from a jurisdiction with high tax rates to a jurisdiction with lower tax rates. On December 15, 2022, EU member states unanimously adopted the OECD Minimum Tax Directive (the “Directive”). The Directive required member states to incorporate similar provisions into their respective domestic laws, with the rules to initially become effective for fiscal years starting on or after December 31, 2023. Other countries outside the EU have taken similar actions. The application of the Directive in national legislation by OECD member states could have a material adverse impact on the net income and cash flow of the Company. MemberIn statesJune 2025, the OECD Group of Seven countries issued a statement that it had reached a shared understanding with the United States Department of Treasury that U.S.-parented companies would be exempt from the Pillar Two undertaxed profits rule and the income inclusion rule. On January 5, 2026, the Organization for Economic Co-operation and Development (OECD) announced a political and technical agreement by the Inclusive Framework on a comprehensive package for a "side-by-side arrangement" (the Package). The Package, in the form of Administrative Guidance, includes a new Simplified Effective Tax Rate (ETR) Safe Harbour, a one-year extension of the OECDTransitional areCountry-by-Country continuingReporting discussions(CbCR) Safe Harbour, a new Substance-based Tax Incentive Safe Harbour and two Safe Harbours related to fundamentala changesSide-by-Side System. This Administrative Guidance will be incorporated into the Commentary to the taxingGlobal rightsAnti-Base Erosion (GloBE) Model Rules. The Package will be applicable as of governments2026 for Substance-based Tax Incentive and allocationSide-by-Side Safe Harbours and 2027 for other updates. New regulation impact will be determined by implementation of profitslegislation among taxin jurisdictions in which companies do business. Since 2013,where the EuropeanCompany Commission (EC) has been investigating tax rulings granted by tax authorities in a number of EU member states with respect to specific multinational corporations to determine whether such rulings comply with EU rules on state aid, as well as more recent investigations of the tax regimes of certain EU member states. If the EC determines that a tax ruling or tax regime violates the state aid restrictions, the tax authorities of the affected EU member state may be required to collect back taxes for the period of time covered by the ruling. Due to the large scale of the Company’s U.S. and international business activities, many of these proposed changes to the taxation of the Company’s activities, if enacted, could increase the Company’s worldwide effective tax rate and harm results of operations.operates.

In Europe, the European Union Emissions Trading Scheme (“EUETS”) is a regulatory regime that facilitates emissions reductions in the EU. The Company’s manufacturing facilities that operate in EU countries that are subject to the EUETS must surrender an amount of emissions allowances equal to the volume of their CO2 emissions. The Company’s manufacturing facilities currently receive a certain amount of allowances for free from national regulators, and, if the actual level of emissions for any facility exceeds its allocated allowance, additional allowances can be bought to cover deficits. Conversely, if the actual level of emissions for any facility is less than its allocation, the excess allowances can be sold. The Company annually purchases additional allowances under the EUETS. Should the regulators significantly restrict the number of emissions allowances allocated for free to the Company’s plants, or significantly restrict the total number of emissions allowances available in the market, or if the price of such allowances increases significantly, these events could have a significant long-term impact on the Company’s operations that are affected by such regulations and could have a material adverse effect on the Company’s financial condition, results of operations and cash flows. It is currently proposed that allocation of allowances will be phased out after 2026.

In the Americas, the U.S., Mexico, and Canada have engaged in significant legislative, regulatory, and enforcement activities relating to GHG emissions for years at the federal, state and provincial levels of government. In the U.S., the EPA regulates emissions of GHG air pollutants under the Clean Air Act, which grants the EPA authority to establish limits for certain air pollutants and to require compliance, levy penalties and bring civil judicial action against violators. The EPA’s GHG regulations continue to evolve, as the structure and scope of the regulations are often the subject of litigation and federal legislative activity. The EPA has also proposed to rescind the 2009 GHG endangerment finding, which serves as the foundation for the agency’s regulation of GHG emissions; however, the ultimate outcome of this proposal is uncertain and may result in additional actions by other policymakers. For example, the State of New York recently adopted regulations requiring GHG emissions reporting from certain companies. New GHG regulations in any national or sub-national jurisdiction where the Company operates could have a significant long-term material impact on the Company’s operations that are affected by such regulations. Several jurisdictions, including the states of California and Washington in the U.S., Mexico, the Canadian federal government, and the province of Quebec,Quebec and Brazil among others, have adopted legislation aimed at reducing GHG emissions, either by explicitly price-based (e.g., carbon tax) or cap-and-trade programs. Additionally, smaller municipalities in the U.S. have engaged in legislative and regulatory activity to price carbon and other emissions. New GHG regulations or significant fluctuations in the values within a carbon-trading or carbon-tax framework in any country, state/province, or municipality where the Company operates could have a significant long-term impact on the Company’s operations that are affected by such regulations and could have a material adverse effect on the Company’s financial condition, results of operations and cash flows. Other regulations may also have a material impact. For example, various policymakers, including the SEC, European Union, and the State of California, have adopted or are considering adopting rules that would require companies to engage in certain climate- or other ESG-related disclosures or actions. Such requirements are not uniform and may not be evenly interpreted or applied. This, along with efforts by some policymakers to constrain companies’ efforts on ESG matters, may increase the complexity and cost of compliance, as well as any associated risks. The expectations of various stakeholders, including customers and employees, regarding such matters likewise continues to evolve. For more information, see the risk factor titled “ESG Scrutiny—Increased environmental, social and governance (ESG) scrutiny and changing expectations from stakeholders may impose additional costs or additional risks.”

FromIn addition, from time to time, the Company engages in certain voluntary targets, disclosures, or other initiatives (such as disclosures) regarding ESG-related matters to improve the ESG profile of the Company or respond to stakeholder expectations; however, such initiatives often impose additional costs, and there is no guarantee that they may be completed either in the manner or timing initially intended or, in either case, have the desired effect. For example, many of these initiatives rely on methodologies, standards, or data that are complex, still evolving, and subject to varying interpretations. The Company’s approach to ESG matters also evolves over time, and there can be no guarantee that ourits approach will align with the expectations or preferences of any particular stakeholder. The Company’s operations, projects and growth opportunities require it to have strong relationships with various key stakeholders, including its share owners, employees, suppliers, customers, local communities and others. However, stakeholder expectations are not uniform and at times conflict. For example, the Company may not choose to engage in or pursue certain ratings, certifications, disclosure frameworks, or other initiatives, whether due to cost or other reasons, and the selection of certain initiatives over others may harm the Company’s reputation with stakeholders that prefer unselected standards or may otherwise adversely impact its business and results of operations. Both advocates and opponents of various ESG matters are increasingly engaging in activism, including litigation, to promote their perspective. Addressing stakeholder expectations involves inherent costs, and any failure or perceived failure to pursue or fulfill the Company’s ESG-related initiatives, navigate stakeholder expectations, or to satisfy various reporting standards could adversely impact its reputation, business activities or competitive advantage. Such ESG matters may also impact the Company’s suppliers and customers, which may compound or cause new impacts on its business, results of operations, or financial condition.

Net sales in 20242025 decreased $574$105 million, or 8%,approximately 2%, compared to the prior year, primarily due to the impact from lower sales volumes,volumes and lower average selling pricesprices, andpartially theoffset impactby from unfavorablefavorable foreign currency translation.

EarningsLoss before income taxes werechanged $29by $87 million lower in 20242025 compared to 2023.earnings before income taxes in 2024. This decreasechange was primarily due to lower segment operating profit, higher restructuring, asset impairment and other charges and slightly higher legacyinterest environmental charges,expense, partially offset by thehigher non-recurrencesegment ofoperating a $445 million goodwill impairment charge that occurred in 2023, lower interest expenseprofit and lower retained corporate and other costs.

Segment operating profit forof reportable segments in 20242025 was $445$98 million lowerhigher compared to the prior year, primarily due to lower shipments,operating costs, partially offset by lower net prices (net of cost inflation) and higherlower operatingsales costs.volumes. The higher operatingOperating costs were primarilyfavorably dueimpacted by benefits from the Company’s Fit to lowerWin productioninitiatives volumesand drivenseveral favorable discrete items, partially offset by temporary curtailments of production volumes, primarily in Europe, to balance withsupply lowerand demand and reduce inventory levels, lower earnings from joint ventures, startup costs for a newly constructed plantlevels and theother non-recurrence of an energy subsidy received in the prior year, partially offset by effective operating and cost management.items.

Net interest expense in 20242025 decreasedincreased $7$6 million compared to 2023,2024, primarily due to lower note repurchase premiums,higher write-offs of deferred finance fees and related charges,charges partiallyfor offsetrefinancing by higher interest rates.activity.

In 2024,2025, the Company recorded net loss attributable to the Company of $129 million, or $0.84 per share, compared to a net loss attributable to the Company of $106 million, or $0.69 per share, compared to a net loss attributable to the Company of $103 million, or $0.67 per share, in 2023.2024. As discussed below, net loss attributable to the Company in 20242025 and 20232024 included items that management considers not representative of ongoing operations and other adjustments. These items increased net loss attributable to the Company by $233$378 million, or $1.50$2.44 per share, in 20242025 and increased net loss attributable to the Company by $594$233 million, or $3.76$1.50 per share, in 2023.2024.

The Company’s net sales in 20242025 were $6,531$6,426 million compared with $7,105$6,531 million in 2023,2024, a decrease of $574$105 million, or 8%.approximately 2%. Average selling prices declined approximately 2%,declined, which decreased net sales by $160$14 million in 2024.2025. Glass container shipments, in tons, declinedwere down approximately 4%3% in 2024,2025 (down approximately 2.5% excluding the impact of divestitures), which decreased net sales by approximately $348$172 million compared to the prior year. ThisThe declineCompany resultedbelieves fromthat softseveral consumerfactors consumptionalso andcontributed destockingto acrosslower thevolumes valuein chain,2025, especiallyincluding challenging market conditions, a major project startup in Europe, inventory corrections in the spiritsMexico category,and asNorth America beer category related to changes in U.S. trade and immigration policies and the Company’s customers,deliberate distributorsdecisions to exit unprofitable business and retailersshift adjustedtoward theirlighter-weight inventoryand managementsmaller practicesformat bottles. Finally, the Company’s shipments to lowerhigher levels.value Also,categories, elevatedsuch competitiveas pressurespremium duespirits, food, non-alcoholic beverages and ready-to-drink, outperformed shipments to sparemainstream capacity,beer particularlyand inwine Europe,categories. impacted net sales in 2024. UnfavorableFavorable foreign currency exchange rates decreasedincreased net sales by $70$112 million in 20242025 compared to the prior year. Other sales were approximately $31 million lower in 2025 than in the prior year, driven by lower machine part sales.

Americas: Net sales in the Americas in 20242025 were $3,584$3,641 million compared to $3,865$3,584 million in 2023,2024, aan decreaseincrease of $281$57 million, or 7%.2%. Slightly higherHigher selling prices in the region increased net sales by $19$136 million in 2024,2025, driven by the pass through of higher cost inflation. Glass container shipments in the region were down2% approximately 3.5%lower in 2024 compared to the prior year,2025, which decreased net sales by approximately $229$57 million.million, Thedue declineto subdued consumer demand, inventory corrections in salesthe primarilyMexico resultedand fromNorth destockingAmerica activity,beer especiallycategory related to spiritschanges in U.S. trade and beerimmigration customers,policies and softthe consumerCompany’s consumption.deliberate decisions to exit unprofitable business as part of its network optimization efforts. The unfavorable effects of foreign currency exchange rate changes decreased net sales by $71$22 million in 20242025 compared to the prior year,2024, as the Brazilian Real and Mexican Peso weakened compared to the U.S. dollar.

Europe: Net sales in Europe in 20242025 were $2,820$2,689 million compared to $3,117$2,820 million in 2023,2024, a decrease of $297$131 million, or 10%.5%. Lower average selling prices in Europe decreased net sales by $179$150 million in 2024.2025. Glass container shipments declineddecreased by approximately 4%3% in 2024, primarily due to destocking activity, especially related to wine2025, and beer customers, elevated competitive pressures due to spare capacity and soft consumer consumption. Lower shipments in 2024this decreased net sales by approximately $119$115 million compared to the prior year.million. The slightlyCompany favorablebelieves that net sales in 2025 were adversely impacted by challenging market conditions and a major project startup. Favorable effects of foreign currency exchange rate changes increased net sales by $1$134 million in 20242025 compared to the prior year.year, as the Euro strengthened compared to the U.S. dollar.

Earnings before(Loss) Before Income Taxes and Segment Operating Profit

EarningsLoss before income taxes werewas $49 million in 2025 compared to earnings before income taxes of $38 million in 2024 compared to $67 million in 2023,2024, a decreasechange of $29$87 million. This decreasechange was primarily due to lower segment operating profit, higher restructuring, asset impairment and other charges and slightly higher legacyinterest environmental charges,expense, partially offset by thehigher non-recurrencesegment ofoperating a $445 million goodwill impairment charge that occurred in 2023, lower interest expenseprofit and lower retained corporate and other costs.

Segment operating profit of reportable segments in 20242025 was $748$846 million, compared to $1,193$748 million in 2023,2024, aan decreaseincrease of $445$98 million, or 37%.13%. This decreaseincrease was primarily due to lower shipments,operating costs, partially offset by lower net prices (net of cost inflation) and higherlower operatingsales costs.volumes. The higher operatingOperating costs were primarilyfavorably dueimpacted by approximately $240 million of benefits from the Company’s Fit to lowerWin productioninitiative volumes(exceeding drivenmanagement’s expectations) and several favorable discrete items that approximated $27 million, including several insurance settlements and an adjustment to its accrued liabilities for carbon emissions, partially offset by approximately $75 million related to temporary curtailments of production volumes, primarily in Europe, to balance withsupply lowerand demand and reduce inventory levels, lower earnings from joint ventures, startup costs for a newly constructed plantlevels and theother non-recurrenceitems. ofFavorable anforeign energycurrency subsidyexchange receivedrates increased segment operating profit by $14 million in 2025 compared to the prior year, partially offset by effective operating and cost management.year.

In order to better match production to customer demand, management has implemented temporary production curtailments in2025, the region.Company Thisfinalized initiativeits hasplans resulted in higher operating costs in 2024 due to unabsorbed fixed costs. Temporary production curtailments may continue during 2025 depending on customer demand levels. If implemented, temporary production curtailments would result in continued elevated operating costs in the segment. In addition, in 2024, the Americas announcedfor the permanent closure of fiveseveral plants and furnaces and the elimination of a reduction in the number of selling, general and administrative positions in the Americas in connection with its Fit to Win initiative. The Company will continue to monitor business trends and consider whether any additional indefinitetemporary downtime or permanent capacity closures in the Americas will be necessary in thefuture futureperiods to align its business with demand trends. Any indefinite or permanent capacity closures could result in material restructuring and impairment charges, as well as cash expenditures, in future periods.

In order to better match production to customer demand, management has implemented temporary production curtailments in the region. This initiative has resulted in higher operating costs in 2024 due to unabsorbed fixed costs. Temporary production curtailments may continue during 2025 depending on customer demand levels. If implemented, temporary production curtailments would result in continued elevated operating costs in the segment. Also, in the fourth quarter of 2024,2025, the Company announcedfinalized its plans for the permanent closure of threeseveral furnaces, a machine lineplants and afurnaces reduction inand the elimination of a number of selling, general and administrative positions in Europe in connection with its Fit to Win initiative. AdditionalThe indefiniteCompany will continue to monitor business trends and consider whether any additional temporary downtime or permanent capacity closures in Europe will likely be necessary in 2025future periods to align its business with demand trends. These closures are dependent on the relevant discussions with certain European Workers’ Councils during 2025. Any indefinite or permanent capacity closures could result in material restructuring and impairment charges, as well as cash expenditures, in future periods.

Net interest expense in 20242025 was $335$341 million compared to $342$335 million in 2023.2024, Thean decreaseincrease of $6 million or approximately 2%. This increase was primarily due to $37 million in lower note repurchase premiums,higher write-offs of deferred finance fees and related charges,charges partiallyfor offsetrefinancing by higher interest rates.activity.

The Company’s effective tax rate from operations for 20242025 was 332%-110% compared to 227%332% for 2023.2024. The effective tax rate for 20242025 differed from 20232024 due to a net unfavorable tax rate on restructuring chargescharges, partially offset by benefits from adjustments to tax attributes due to an agreement with Taxing Authorities in Europe, benefits from a European investment tax incentive and a change in the mix of geographic earnings. The annual effective tax rate for 2024 differs from the statutory U.S. Federal tax rate of 21%, primarily due to the geographic mix of pretax earnings and losses and their impacts on the overall rate.

For 2024,2025, the Company recorded a net loss attributable to the Company of $129 million, or $0.84 per share, compared to a net loss attributable to the Company of $106 million, or $0.69 per share, comparedfor to a net loss attributable to the Company of $103 million, or $0.67 per share, in 2023.2024. Net loss attributable to the Company in 20242025 and 20232024 included items that management considers not representative of ongoing operations and other adjustments as set forth in the following table (dollars in millions).

Given the global nature of its operations, the Company is subject to fluctuations in foreign currency exchange rates. As described above, the Company’s reported revenues and segment operating profit in 20242025 were lower or flathigher due to foreign currency effects compared to 2023.2024.

Retained corporate costs and other for 20242025 were $134$107 million compared to $224$134 million in 2023.2024. These costs decreased in 2024,2025, primarily due to lowerapproximately spending$60 million of benefits from the Company’s Fit to Win initiative (exceeding management’s expectations) and an approximate $8 million one-time benefit from the settlement of a previously reserved royalty receivable in the fourth quarter of 2025, partially offset by higher management incentive expense.expense and other costs.

The Company has initiated a strategic review of the remaining businesses in the former Asia Pacific region. This review is aimed at exploring options to maximize share owner value, focused on aligning the Company’s business with demand trends and improving the Company’s operating efficiency, cost structure and working capital management. The review ishas ongoing and may resultresulted in divestitures, corporate transactions or similar actions,actions. This review is ongoing and could cause the Company to incur additional restructuring, impairment, disposal or other related charges in future periods.

For the year ended December 31, 2024,2025, the Company recorded restructuringrestructuring, asset impairment and other charges of approximately $206$443 million (which included $117 million related to its decision to halt the MAGMA program) to Other expense, net ($204 million) and Equity earnings ($2 million) in the Consolidated Results of Operations, primarily related to the Fit to Win program.initiative. These charges consisted of employee costs, such as severance and benefit-related costs, write-down of assets and other exit costs in the Americas segment ($79$112 million), Europe segment ($115$245 million) and Retained corporate costs and other ($14$88 million). AdditionalIn addition, these charges also reflect approximately $2 million of other credits. As of December 31, 2025, the Company has incurred cumulative charges of approximately $646 million related to the Fit to Win initiative. Approximately $50 million of additional restructuring charges are expected in future quarters2026 when management completes their assessment to reduce redundant production capacity.capacity and streamline costs. The Company expects that the majority of the remaining cash expenditures related to the accrued employee and other exit costs will be paid out over the next several years. These charges also reflect approximately $2 million of other credits.

For the year ended December 31, 2023,2024, the Company implemented several discrete restructuring initiatives and recorded restructuring and other charges of $100approximately million.$206 million to Other expense, net ($204 million) and Equity earnings ($2 million) in the Consolidated Results of Operations, primarily related to the Fit to Win initiative. These charges consisted of employee costs, such as severance and benefit-related costs, write-down of assets and other exit costs in the Americas segment ($89$79 million), Europe segment ($6$115 million) and Retained Corporatecorporate costs and other ($2$14 million). These restructuring charges were discrete actions and are expected to approximate the total cumulative costs for those actions, as no significant additional costs are expected to be incurred. These charges were recorded to Other income (expense), net on the Consolidated Results of Operations. The Company expects that the majority of the remaining cash expenditures related to the accrued employee costs will be paid out over the next several years. These charges also reflect approximately $3$2 million of other charges.credits.

On AugustSeptember 30, 2022,2025, certain of the Company’s subsidiaries entered into an AmendmentAmended No.and 1 to itsRestated Credit Agreement and Syndicated Facility Agreement (the “Credit Agreement Amendment”), which amendsrefinanced in full the Originalprevious Agreementcredit (as amended by the Credit Agreement Amendment, the “Credit Agreement”).agreement. The Credit Agreement Amendment provides for up to $500$2.7 millionbillion of additional borrowings inpursuant the form of term loans. The proceeds of suchto term loans were used, together with cash, to retire the $600 million delayed drawA, term loan.loans B and a revolving credit facility. The term loans A mature, and the revolving credit facilitiesfacility terminate,terminates, in MarchSeptember 2027.2030, Theand the term loans borrowedB mature in September 2032; provided, however, that if any of the senior notes issued by certain subsidiaries of the Company are outstanding on the date that is 91 days prior to the maturity date for such senior notes (any such date, a “Springing Maturity Date”), then the term loans A, the revolving credit facility and the term loans B will mature and terminate, as applicable, on such Springing Maturity Date. Borrowings under the Credit Agreement Amendment are secured by certain collateral of the Company and certain of its subsidiaries. In addition, the Credit Agreement Amendment makes modifications to certain loan documents, in order to give the Company increased flexibility to incur secured debt in the future.

At December 31, 2024,2025, the Credit Agreement includes a $300$1.25 millionbillion multicurrency revolving credit facility, athe $950U.S. dollar equivalent of $800 million multicurrency revolving credit facility and $1.45 billion in term loan A facilities ($1.34$799 billionmillion outstanding balance at December 31, 2024,2025, net of debt issuance costs) and $650 million in term loan B facilities ($643 million outstanding balance at September 30, 2025, net of debt issuance costs). At December 31, 2024,2025, the CompanyCompany’s subsidiaries that are party to the Credit Agreement had unused credit of $1.24 billion available under the revolving credit facilities as part of the Credit Agreement. The weighted average interest rate on borrowings outstanding under the Credit Agreement at December 31, 20242025 was 6.32%.5.66%.

The Credit Agreement also contains one financial maintenance covenant, a Secured Leverage RatioRatio, (as defined infor the Creditbenefit Agreementof lenders under the term loans A and the revolving credit facility (and, following an acceleration of the term loans A and the revolving credit facility, for the benefit of the lenders under the term loans B), that requires the Company and certain of its subsidiaries, collectively, not to exceed a ratio of 2.50x calculated by dividing consolidated Net Indebtedness that is then secured by Liens on property or assets of the Company and certain of its subsidiaries by Consolidated EBITDA, as each such capitalized term is defined and as described in the Credit Agreement. The Secured Leverage Ratio could restrict the ability of the Company and certain of its subsidiaries to undertake additional financing or acquisitions to the extent that such financing or acquisitions would cause the Secured Leverage Ratio to exceed the specified maximum.

Failure to comply with these covenants and restrictions could result in an event of default under the Credit Agreement. In such an event, the Companyapplicable couldborrowers under the Credit Agreement would not be able to request additional borrowings under the revolving facilities,credit facility, and all amounts outstanding under the Credit Agreement, together with accrued interest, could then be declared immediately due and payable. Upon the occurrence and for the duration of a payment event of default, an additional default interest rate equal to 2.0% per annum will apply to all overdue obligations under the Credit Agreement. If an event of default occurs under the Credit Agreement and the lenders cause all of the outstanding debt obligations under the Credit Agreement to become due and payable, this wouldcould result in a default under thea indenturesnumber governingof the Company’sother outstanding debt securities and could lead to an acceleration of obligations related to these debt securities. As of December 31, 2024,2025, the Company was in compliance with all covenants and restrictions in the Credit Agreement. In addition, the Company believes that it will remain in compliance for the term of the Credit Agreement and that its ability to borrow additional funds under the Credit Agreement will not be adversely affected by the covenants and restrictions.

The Total Leverage Ratio (as defined in the Credit Agreement) determines pricing under the Credit Agreement.Agreement for the Term Loans A and the revolving credit facility. The interest rate on borrowings under the Credit Agreement is, at the Company’soption option,of the applicable borrower, the Base Rate, Term SOFR or, for non-U.S.non-US dollarDollar borrowings only, the Eurocurrency Rate (each such capitalized term as defined in the Credit Agreement), plus an applicable margin. The applicable marginmargin, is linked tofor the TotalTerm LeverageLoans Ratio.A Theand marginsthe rangerevolving credit facility, ranges from 1.00% to 2.25%1.75% for Term SOFR loans and Eurocurrency Rate loans and from 0.00% to 1.25%0.75% for Base Rate loans. The applicable margin, for the Term Loans B, is 3.00% for Term SOFR loans. In addition, a commitment fee is payable on the unused revolving credit facility commitments ranging from 0.20% to 0.35% per annumannum, linkeddepending toon the Total Leverage Ratio.

Operating activities: Cash provided by operating activities was $489$600 million for 2024,2025, compared to $818$489 million of cash provided by operating activities for 2023.2024. TheDespite decreasea higher net loss in 2025, the increase in cash provided by operating activities in 20242025 was primarily due to lower business performance, the non-recurrence of the $445 million goodwill impairmenthigher non-cash charge that occurred in 2023charges and higherlower restructuringworking payments,capital levels, partially offset by ahigher lowercash usepaid offor workingrestructuring capital than in 2023.payments.

Working capital wasprovided $20 million of cash in 2025, compared to a use of cash of $125 million in 2024,2024. comparedExcluding tothe a useimpact of exchange rates, the higher cash of $148 million in 2023. The use of cashprovided from working capital in 20242025 was driven by lower accounts payable as spending levels declined compared to 2023receivables and lowerinventory income tax payables.levels. The Company’s use of its accounts receivable factoring programs resulted in a decreasedecreases in net cash provided by operating activities of approximately $7$4 million and an increase in cash provided by operating activities of approximately $7 million forin 20242025 and 2023,2024, respectively. See Note 20 to the Consolidated Financial Statements for additional information. Excluding the impact of accounts receivable factoring, the Company’s days sales outstanding as of December 31, 20242025 were comparable to December 31, 2023.2024.

Cash payments for restructuring activities increased to $128 million in 2025 from $41 million in 2024 from $26 million in 2023 due to higher payments associated with the initial phase of the Company’s Fit to Win program,initiative, which will continue into at least 2025.2026. The Company estimates that payments for restructuring activities will be approximately $150 million in 2026 and are expected to taper thereafter.

Investing activities: Cash utilized in investing activities was $620$368 million for 2024,2025, compared to $683$620 million of cash utilized in investing activities for 2023.2024. Capital spending for property, plant and equipment was $432 million in 2025, compared to $617 million in 2024, comparedreflecting tolower $688spending millionas the Company was constructing a new plant in 2023.Bowling Green, Kentucky and several other expansion projects in 2024 that did not reoccur in 2025. The Company estimates that its full year 20252026 capital expenditures will be approximately $400 million to $450 million.

The Company received approximately $29$56 million of net cash proceeds for the sale of miscellaneous businesses and other assets in 20242025 compared to $11$29 million received in 2023.2024. The Company contributedreceived $3$8 million to its joint ventures in 2024 compared to $10 million contributed in 2023. The Companyand paid $29 million and received $4 million related to hedgehedging activity in 20242025 and 2023,2024, respectively.

Financing activities: Cash utilized in financing activities was $8$250 million for 20242025 compared to $27$8 million of cash utilized by financing activities in 2023.2024. Financing activities in 2025 included additions to long-term debt of $2,526 million, which included the refinancing of the Company’s credit agreement. Financing activities in 2025 also included the repayment of long-term debt of $2,643 million. Financing activities in 2024 included additions to long-term debt of $1,102 million, which included the issuance of €500 million aggregate principal amount of 5.250% senior notes due 2029 and $300 million aggregate principal amount of 7.375% senior notes due 2032. Financing activities in 2024 also included the repayment of long-term debt of $1,043 million, which included the repurchase of €323.4 million aggregate principal amount of the Company’s 2.875% Senior Notes 2025 pursuant to a tender offer and the redemption of $300 million aggregate principal amount of the Company’s 6.375% Senior Notes due 2025. Financing activities in 2023 included additions to long-term debt of $1,332 million, which included the issuance of €600 million aggregate principal amount of 6.250% senior notes due 2028 and $690 million aggregate principal amount of 7.250% senior notes due 2031. Financing activities in 2023 also included the repayment of long-term debt of $1,298 million, which included the repurchase and redemption of $250 million aggregate principal amount of the Company’s 5.875% Senior Notes due 2023, the repurchase of €666.7 million aggregate principal amount of the Company’s 3.125% Senior Notes due 2024, and the repurchase of $282.8 million aggregate principal amount of the Company’s 5.375% Senior Notes due 2025. As a result of financing activities, the Company paid finance fees and premiums of $13$18 million and $22$13 million for 20242025 and 2023,2024, respectively. BorrowingsRepayments under short-term loans were $17 million and $47$30 million in 20242025 andcompared 2023,to respectively.$17 million of borrowings in 2024. The Company paid approximately $40$23 million related to hedging activity in 2023.2025.

In May 2024, the Company’s Board of Directors authorized a $100 million anti-dilutive share repurchase program for the Company’s common stock that the Company intends to use to offset stock-based compensation provided to the Company’s directors, officers, and employees. This repurchase program superseded and replaced a prior $150 million repurchase program authorized by the Board of Directors in February 2021. In each of 20242025 and 2023,2024, the Company repurchased $40 million of shares of the Company’s common stock under these share repurchase programs. The Company intends to repurchase at least $40 million of shares of the Company’s common stock in 2025.2026.

Goodwill at December 31, 20242025 totaled approximately $1.32$1.49 billion, representing approximately 15%16% of total assets. As of December 31, 2024,2025, the Company has three reporting units and includes $800$897 million of recorded goodwill to the Company’s Europe reporting unit, $521$590 million of recorded goodwill to the Company’s Latin America reporting unit and $0 of recorded goodwill to the Company’s North America reporting unit (subsequent to the 2023 impairment). During the fourth quarter of 2024,2025, the Company completed its annual impairment testing and determined that no impairment existed. TheAs BEVsof October 1, 2025, the BEV of the Company’s Europe andreporting unit exceeded its carrying value by approximately 21%, while the BEV of the Company’s Latin America reporting unitsunit substantially exceeded theirits carrying values as of October 1, 2024.value. However, there can be no assurance that anticipated financial results will be achieved, and the goodwill balances remain susceptible to future impairment charges. Future changes in the Company’s cost of capital or expected cash flows may cause the Company’s goodwill to become impaired, resulting in a non-cash charge against the Company’s results of operations. Any impairment charges that the Company may take in the future could be material to its consolidated results of operations and financial condition.

Except as set forth below, there have been no material changes in risk factors at MarchJune 31,30, 2026 from those described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

For example, the current conflict between Russia and Ukraine has caused a significant increase in the price of natural gas and increased price volatility. Natural gas forms the primary energy source for the Company’s European operations, and a significant amount of natural gas in Europe is ultimately sourced from Russia. The Company’s European operations typically purchase natural gas under mid- to long-term supply arrangements with terms that range from one to three years and, through these agreements, typically agree on a portion of the price with the relevant supplier in advance of the period in which the natural gas will be delivered, which shields the Company from the full impact of increased natural gas prices, while such agreements remain in effect. However, if new agreements are entered into during periods when prices have increased, this would lead to cost inflation and could impact the Company’s profitability if the Company is not able to pass on these increased costs to customers. Moreover, higher global energy costs in Europe are expected in future periods driven by the conflicts in the Middle East.

The Company relies on third parties to provide equipment and materials needed for its capital expenditure projects. The global supply chain for the Company’s capital expenditure projects has been, and may continue to be impacted by disruptions, such as political events, international trade disputes or other geopolitical tensions, acts of terrorism, hostilities or wars (such as the continued conflicts in the Middle East and between Russia and Ukraine), natural disasters, public health issues, such as a pandemic, industrial accidents, inflation, and other business interruptions. Global supply chain disruptions may continue to adversely impact the Company’s ability to procure materials and equipment in a timely and cost-effective manner, which may negatively impact the Company’s operating costs and timelines for capital expenditure projects.projects and limit the Company’s sales opportunities.

Financial information for the three and six months ended MarchJune 31,30, 2026 and 2025 regarding the Company’s reportable segments is as follows (dollars in millions):

Executive Overview — Quarters ended MarchJune 31,30, 2026 and 2025

Net sales in the firstsecond quarter of 2026 decreased $27$38 million, or approximately 2%, compared to the same period in the prior year, primarily due to the impact from lower sales volumes and lower average selling prices,volumes, partially offset by slightly higher average selling prices and favorable foreign currency translation.

Loss before income taxes changed by $71$834 million in the firstsecond quarter of 2026 compared to earnings before income taxes in the same quarter in 2025. This change was primarily due to a goodwill impairment and lower segment operating profit in Europe.

Segment operating profit of reportable segments in the firstsecond quarter of 2026 was $67$54 million lower compared to the same period in the prior year, primarily due to lower net prices (net of cost inflation) and lower sales volumes, partially offset by slightly lower operating costs and the favorable impact of foreign currency translation. Operating costs were favorably impacted by benefits from the Company’s Fit to Win initiatives,initiative, partially offset by temporaryfurnace production curtailmentsevents and several externaloperational disruptions infollowing the Americas, temporary expenses associated withrecent plant closuresrestructuring in Europeactions and theother nonrecurrence of an insurance settlement in the first quarter of 2025.costs.

Net interest expense in the firstsecond quarter of 2026 decreasedincreased $2$1 million compared to the firstsecond quarter of 2025.

In the firstsecond quarter of 2026, the Company recorded net loss attributable to the Company of $73$972 million, or $0.48$6.33 per share, compared to a net loss attributable to the Company of $16$5 million, or $0.10$0.03 per share, in the firstsecond quarter of 2025. As discussed below, net loss attributable to the Company in 2026 and 2025 included items that management considers not representative of ongoing operations and other adjustments. These items increased net loss attributable to the Company by $81$986 million, or $0.53$6.42 per share, in the firstsecond quarter of 2026 and increased net loss attributable to the Company by $79$86 million, or $0.50$0.56 per share, in the firstsecond quarter of 2025.

Results of Operations — FirstSecond Quarter of 2026 Compared with FirstSecond Quarter of 2025

The Company’s net sales in the firstsecond quarter of 2026 were $1,540$1,668 million compared with $1,567$1,706 million in the firstsecond quarter of 2025, a decrease of $27$38 million, or approximately 2%. Average selling prices declined, which decreased net sales by $13 million in the first quarter of 2026. Glass container shipments, in tons, were down approximately 9%5% in the firstsecond quarter of 2026 (down approximately 8%4.5% excluding the impact of a divestiture), which decreased net sales by approximately $131$84 million compared to the same period in the prior year. Average selling prices slightly increased, which increased net sales by $4 million in the second quarter of 2026. The Company believes that several factors contributed to lower volumes in the firstsecond quarter of 2026, including softer demanddemand, inchallenging prior year comparisons, and constrained sales opportunities resulting from several furnace events and operational disruptions following recent plant restructuring actions. Demand trends improved sequentially through the second quarter with June 2026 sales volumes being flat with June 2025. Food and non-alcoholic beverage glass container sales continue to perform better than beer, wine and spirits categories, tougher comparisons as the first quarter of 2025 likely benefitted from higher demand ahead of new U.S. tariffs and competitive pressures, primarily in Europe.sales. Favorable foreign currency exchange rates increased net sales by $130$49 million in the firstsecond quarter of 2026 compared to the same period in the prior year. Other sales were approximately $13$7 million lower in the firstsecond quarter of 2026 than in the same quarter in the prior year, driven by the divestiture of a plant in the fourth quarter of 2025 in the former Asia Pacific region.

Americas: Net sales in the Americas in the firstsecond quarter of 2026 were $871$949 million compared to $873$943 million in the firstsecond quarter of 2025, aan decreaseincrease of $2$6 million, or less than 1%. Higher selling prices in the region increased net sales by $23$36 million in the firstsecond quarter of 2026. Glass container shipments were approximately 9%7% lower in the firstsecond quarter of 2026, which decreased net sales by approximately $82$74 million, due to challenging prior year comparisonscomparisons, softer demand, exiting some unprofitable business and soft demand in the beer and wine categories and ongoing customer inventory adjustments in spirits. Sales trends were more stable in the food and non-alcoholic beverage categories. Sales volumes in the first quarterimpact of 2026a throughoutfurnace theevent, segmentwhich wereconstrained downsales in North America and Mexico and up in South America compared to the first quarter of 2025.opportunities. The favorable effects of foreign currency exchange rate changes increased net sales by $57$44 million in the firstsecond quarter of 2026 compared to the same period in 2025, as the Brazilian Real, Colombian Peso and Mexican Peso strengthened compared to the U.S. dollar.

Europe: Net sales in Europe in the firstsecond quarter of 2026 were $655$704 million compared to $667$741 million in the firstsecond quarter of 2025, a decrease of $12$37 million, or approximately 2%.5%. Lower average selling prices in Europe decreased net sales by $36$32 million in the firstsecond quarter of 2026. Glass container shipments decreased by approximately 7%2% in the firstsecond quarter of 2026, which decreased net sales by approximately $49$10 million. The Company believes that lower net sales in the firstsecond quarter of 2026 were adversely impacted by competitive price pressure in select markets and tougher comparisons, as the first quarter of 2025 likely benefitted from higher demand ahead of new U.S. tariffs. Lower shipments were most pronounceddue to wineoperational customersdisruptions acrossfollowing Southernrecent Europe.plant restructuring actions, which limited sales opportunities. Favorable effects of foreign currency exchange rate changes increased net sales by $73$5 million in the firstsecond quarter of 2026 compared to the same period in the prior year, as the Euro slightly strengthened compared to the U.S. dollar.

Loss before income taxes was $53$827 million in the firstsecond quarter of 2026 compared to earnings before income taxes of $18$7 million in the firstsecond quarter of 2025, a change of $71$834 million. This change was primarily due to a goodwill impairment and lower segment operating profit in Europe.

Segment operating profit of reportable segments in the firstsecond quarter of 2026 was $142$171 million, compared to $209$225 million in the firstsecond quarter of 2025, a decrease of $67$54 million, or 32%.24%. This decrease was primarily due to lower net prices (net of cost inflation) and lower sales volumes. Operating costs were slightly lower and favorably impacted by approximately $38$53 million of benefits from the Company’s Fit to Win initiative (consistent with management’s expectations), partially offset by approximately $30$34 million related to temporary production curtailments, severalfurnace externalevents and operational disruptions infollowing the Americas, temporary expenses associated withrecent plant closuresrestructuring in Europeactions and other higher costs and the nonrecurrence of a $7 million insurance settlement in the first quarter of 2025.costs. Favorable foreign currency exchange rates increased segment operating profit by $13$9 million in the firstsecond quarter of 2026 compared to the same quarter in the prior year.

Americas: Segment operating profit in the Americas was $142$165 million in the firstsecond quarter of 2026, compared to $141$135 million in the firstsecond quarter of 2025, an increase of $1$30 million, or lessapproximately than 1%. The impact of lower shipments discussed above, partially offset by an improved mix, decreased segment operating profit by $8 million in the first quarter of 2026 compared to the same quarter in 2025.22%. Higher selling prices exceeded higher cost inflation and resulted in a $11$21 million increase to segment operating profit in the firstsecond quarter of 2026. The impact of lower shipments discussed above decreased segment operating profit by $17 million in the second quarter of 2026 compared to the same quarter in 2025. The effects of foreign currency exchange rates increased segment operating profit by $7$10 million in the firstsecond quarter of 2026.

Europe: Segment operating profit in Europe was $0$6 million in the firstsecond quarter of 2026 compared to $68$90 million in the firstsecond quarter of 2025, a decrease of $68$84 million.million, or approximately 93%. Lower net selling prices (net of cost inflation) decreased segment operating profit by $76$85 million in the firstsecond quarter of 2026 compared to the same quarter in 2025 due to elevated competitive pressures and a step-up in energy costs following the expiration of favorable energy contracts at the end of 2025 and elevatedhigher competitivecosts pressures.stemming from the Middle East conflicts. The impact of lower shipments discussed above decreased segment operating profit by approximately $8$1 million.

Partially offsetting this was the benefit of $10$3 million of lower operating costs in the firstsecond quarter of 2026 compared to the same quarter in 2025, driven by approximately $20$34 million of benefits from the Fit to Win initiatives.initiative. These benefits were partially offset by approximately $10$31 million related to temporaryhigher expensesoperating costs associated with recent plant closuresrestructuring inactions, Europetwo furnace events and other higher costs. The effects of foreign currency exchange rates increaseddecreased segment operating profit by $6$1 million in the firstsecond quarter of 2026.

Net interest expense in the firstsecond quarter of 2026 was $79$86 million compared to $81$85 million in the firstsecond quarter of 2025.

The Company’s effective tax rate from operations for the firstsecond quarter of 2026 was (34%17%) compared to 167%86% for the firstsecond quarter of 2025. The effective tax rate for the firstsecond quarter of 2026 differed from the firstsecond quarter of 2025 due to pretaxnon-deductible earningsgoodwill changingimpairment fromcharges, pretaxthe incomeadditional $96 million change in 2025European tovaluation aallowance pretaxon lossdeferred intax 2026assets and a change in the mix of geographic earnings.earnings in the second quarter of 2026.

For the first quartersix months of 2026, the Company recorded a net loss attributable to the Company of $73$1,046 million, or $0.48$6.83 per share, compared to a net loss attributable to the Company of $16$20 million, or $0.10$0.13 per share, in the first quartersix months of 2025. Net loss attributable to the Company in the first quarterhalf of 2026 and 2025 included items that management considers not representative of ongoing operations and other adjustments as set forth in the following table (dollars in millions).

Retained corporate costs and other for the firstsecond quarter of 2026 were $32$24 million compared to $30$25 million in the second quarter of 2025 and were $56 million in the first quartersix months of 2026 compared to $53 million for the same period in 2025. These costs increasedwere impacted in the second quarter and first quartersix months of 2026, primarily due to lower management incentive expenses, higher expenses related to transformation activities andactivities, lower recharges to the regions due to decreasing costs, partially offset by approximately $12 million and $24 million of benefits from the Company’s Fit to Win initiative in the second quarter of 2026 and the first six months of 2026, respectively (consistent with management’s expectations).

For the three and six months ended MarchJune 31,30, 2026, the Company recorded restructuring, asset impairment and other charges of approximately $38$17 million and $55 million, respectively, to Other expense, net in the Condensed Consolidated Results of Operations, all of which related to the Fit to Win program. TheseFor the three months ended June 30, 2026, these charges consisted of employee costs, such as severance and benefit-related costs, write-down of assets and other exit costs in the Americas segment ($3$4 million), and in the Europe segment ($13 million). For the six months ended June 30, 2026, these charges consisted of employee costs, such as severance and benefit-related costs, write-down of assets and other exit costs in the Americas segment ($7 million), Europe segment ($31$44 million) and Retained corporate costs and other ($4 million). As of March 31, 2026, the Company has incurred cumulative charges of approximately $684 million related to the Fit to Win program. Additional restructuring charges are expected in future quarters when management completes its assessment to reduce redundant production capacity and streamline costs. The Company expects that the majority of the remaining cash expenditures related to the accrued employee and other exit costs will be paid out over the next several years.

For the three and six months ended MarchJune 31,30, 2025, the Company recorded restructuring, asset impairment and other charges of approximately $82$108 million (which included $104 million related to its decision to halt the MAGMA program) and $191 million, respectively, to Other expense, net in the Condensed Consolidated Results of Operations, all of which all related to the Fit to Win program. TheseFor the three months ended June 30, 2025, these charges consisted of employee costs, such as severance and benefit-related costs, write-down of assets and other exit costs in the Americas segment ($6$45 million), Europe segment ($52$3 million) and Retained corporate costs and other ($24$60 million). For the six months ended June 30, 2025, these charges consisted of employee costs, such as severance and benefit-related costs, write-down of assets and other exit costs in the Americas segment ($52 million), Europe segment ($55 million) and Retained corporate costs and other ($84 million).

In the second quarter of 2026, the Company recorded pre-tax gains of approximately $2 million on the sale of land from a previously closed plant in the Americas. In the first quartersix months of 2026, the Company recorded pre-tax losses of approximately $46$44 million, primarily related to the sale of its share of a joint venture in the former Asia Pacific region.

In the first quartersix months of 2025, the Company recorded pre-tax gains of approximately $6 million on the sale of land and buildings of a previously closed plant in the Americas.

From December 31, 1956 through June 1967, the Company, via a wholly-owned subsidiary, owned and operated a paper mill located on the shore of the Cuyahoga River in Ohio, which is now part of the Cuyahoga Valley National Park that is managed by the National Park Service (“NPS”).  The Company and the United States had been engaged in litigation regarding the site in the U.S. District Court for the Northern District of Ohio (Akron), with the United States claiming that the Company should pay $50 million as a remedy for certain soils at the site as well as its past and anticipated future costs. In the first quarter of 2025, the Company and the NPS reached a tentative settlement, and the Company recorded a charge of approximately $4 million to Other expense, net in the Condensed Consolidated Results of Operations to augment its previous accrual balance related to this matter. In the third quarter of 2025, the consent order between the parties was approved by the U.S. District CourtCourt, and the Company paid $16.5 million to resolve this matter.