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

•The North American housing market may remain depressed or decline further, and any such continuation or decline in the homebuilding industry may adversely affect our operating results.

•We may pursue acquisitions, dispositions, joint ventures or other transactions that may impact our results of operations and financial condition. We may have difficulties integrating the operations of recently acquired businesses, such as Westlake Epoxy,ACI, and future acquired businesses.

•The Credit Agreement and the indenture governing certain of our senior notes impose significant operating and financial restrictions, which may prevent us from capitalizing on business opportunities and taking somecertain actions.

Our historical operating results reflect the cyclical and volatile nature of the petrochemical industry. The industry is mature and capital intensive. Margins in this industry are sensitive to supply and demand balances both domestically and internationally, which historically have been cyclical. The cycles are generally characterized by periods of tight supply, leading to high operating rates and margins, followed by periods of oversupply primarily resulting from excess new capacity additions, leading to reduced operating rates and lower margins. Moreover, profitability in the petrochemical industry is affected by the worldwide level of demand along with vigorous price competition which may intensify due to, among other things, new industry capacity. In general, weak economic conditions reduce demand and put pressure on margins. It is not possible to predict accurately the supply and demand balances, market conditions and other factors that will affect industry operating margins in the future.

New capacity additions, principally of ethylene, polyethylene, chlorine, caustic soda and PVC in North America, Asia and the Middle East and in the epoxy value chain in Asia, a number of which have been recently completed, mayhave leadled to periods of over-supply and lower profitability. Additionally, new entrants to the market, including when customers backward integrate into products we supply, can further exacerbate supply and demand imbalances. As a result, our Performance and Essential Materials ("PEM") segment operating margins may be negatively impacted.

We sell most of our commodity products in highly competitive markets. Competition in commodity markets is based primarily on price and to a lesser extent on performance, product quality, product deliverability and customer service. As a result, we generally are not able to protect our market position for most of these products by product differentiation and may not be able to pass on cost increases to our customers. Accordingly, increases in raw material and other costscosts, including increased environmental regulation, may not necessarily correlate with changes in prices for these products, either in the direction of the price change or in magnitude. Specifically, timing differences in pricing between raw material prices, which may change daily, and contract product prices, which in many cases are negotiated monthly or less often, sometimes with an additional lag in effective dates for increases, have had and may continue to have a negative effect on profitability. Significant volatility in raw material costs tends to place pressure on product margins as sales price increases could lag behind raw material cost increases. Conversely, when raw material costs decrease, customers could seek relief in the form of lower sales prices. We may reduce production at or idle a facility for an extended period of time or exit a business because of high raw material prices, an oversupply of a particular product and/or a lack of demand for that particular product, which makes production uneconomical. Factors such as increases in raw material costs or lower demand may cause us to further reduce operating rates, idle facilities or exit uncompetitive businesses. Changes in competitors' production or shifts in their marketing focus have in the past significantly affected both the prices at which we sell our commodity products and the volumes that we sell, and are likely to continue to do so in the future.

We operate internationally and are subject to the risks of doing business on a global basis. These risks include, but are not limited to, fluctuations in currency exchange rates, currency devaluations, inflationary pressures and possibility of recession, restrictions on the transfer of funds, changes in law and regulatory requirements, involvement in judicial proceedings in unfavorable jurisdictions, economic instabilityinstability, geopolitical conflicts, including the ongoing conflicts in the Middle East and between Russia and Ukraine, supply chain disruptions, political unrest and epidemics. Our operating results could be negatively affected by any of these risks.

Additionally, trade regulations, policies and disputes can and may continue to increase trade barriers, tariffs, duties or other taxes, limit our ability to sell certain products to certain customers and otherwise impact our global supply and distribution chains. In particular, our commodity PVC resins manufactured in the United States, which traditionally were exported in meaningful volumes, have recently been subject to anti-dumping investigations or duties by the relevant authorities in the European Union, United Kingdom and India,Brazil, resulting in recommendations or impositions of provisional or final duties on U.S. exports to each of these regions. As of December 2024,2025, the European Union had imposed a tariff margin of 58.0%, the United Kingdom had imposed a duty of 56.01% and IndiaBrazil had recommendedimposed a provisional duty in the amount of $164 per metric ton.43.7%. Such duties have had and may continue to have adverse effects on demand for and sales of our PVC-based products in such regions. Additionally, the higher cost for PVC resins resulting from such trade barriers may cause potential consumers to permanently switch to substitute products, further reducing demand for our PVC resins. Any increase in trade barriers would likelycould negatively impact our ability to export our products outside of the United States and increased tariffs, duties or other taxes would increase the costs of our products and reduce demand for our products outside of the United States.

Changes in U.S. foreign trade policies, including changes proposed by the newcurrent presidential administration, could also lead to the imposition of additional trade barriers and tariffs or other taxes on us in foreign jurisdictions. We cannot predict what changes to trade policy will be made by the current or a future presidential administration or Congress, including whether existing tariff policies will be maintained or modified or whether the entry into new bilateral or multilateral trade agreements will occur, nor can we predict the effects that any such changes would have on our business. Changes in U.S. trade policy may also result in additional responses from U.S. trading partners, including adopting retaliatory trade policies making it more difficult or costly for us to ship, transport or export our products or import feedstocks from countries where we currently purchase feedstocks or sell products. Any such changes in U.S. trade policy or in laws and policies governing foreign trade, or the perception that they could occur, and any resulting negative sentiments towards the United States as a result, could materially and adversely affect our business, growth prospects, financial condition, results of operations and liquidity.

Our operations depend on the continued supply of raw materials and reliable energy. The availability of natural gas and electricity can be affected by numerous events such as weather (e.g., hurricanes and periods of considerable heat or cold), pipeline and other logistics interruptions, electrical grid outages, cybersecurity incidents, intermittent electricity generation, hostilities and sanctions arising from geopolitical tensions, human error, and supply and demand imbalances for raw materials and electricity. Significant variations in the costs and availability of raw materials and energy may negatively affect our results of operations. These costs have risen significantly in the past due primarily to oil and natural gas cost increases. We purchase significant amounts of ethane feedstock, natural gas, ethylene and salt to produce several basic chemicals. We also purchase significant amounts of electricity to supply the energy required in our production processes. The cost of these raw materials and energy, in the aggregate, represents a substantial portion of our operating expenses. The prices of raw materials and energy generally follow price trends of, and vary with market conditions for, crude oil and natural gas, which are highly volatile and cyclical, as well as the ability of domestic producers to export natural gas liquids, ethane and ethylene. Changes to regulatory policies applicable to the German energy sector for industrial users have contributed to higher prices for industrial users of energy in the past and may continue to do so in the future. Our results of operations have been and could in the future be significantly affected by increases in these costs.

Price increases increase our working capital needs and, accordingly, can adversely affect our liquidity and cash flows. In addition, because we utilize the first-in, first-out ("FIFO") method of inventory accounting, during periods of falling raw material prices and declining sales prices, our results of operations for a particular reporting period could be negatively impacted as the lower sales prices would be reflected in operating income more quickly than the corresponding drop in feedstock costs. We use derivative instruments (including commodity swaps and options) from time to time in an attempt to reduce price volatility risk on some feedstock commodities. In the future, we may decide not to hedge any of our raw material costs or any hedges we enter into may not have successful results. Also, our hedging activities involve credit risk associated with our hedging counterparties, and a deterioration in the financial markets could adversely affect our hedging counterparties and their abilities to fulfill their obligations to us.

Lower prices of crude oil, such as those experienced from the third quarter of 2014 through 2020, led to a reduction in the cost advantage for natural gas liquids-based ethylene crackers in North America, such as ours, as compared to naphtha-based ethylene crackers. As a result, our margins and cash flows were negatively impacted. Lower crude oil and natural gas prices could lead to a reduction in hydraulic fracturing in the United States, which could reduce the availability of feedstock and increase prices of feedstock for our operations. Lower crude oil and natural gas prices could result from, among other things, increased exports from producers in Venezuela, Russia or the Middle East following resolution of conflicts or political instability in such regions. Higher natural gas prices could also adversely affect our ability to export products that we produce in the United States. In addition to the impact that this has on our exports from the United States, reduced competitiveness of U.S. producers also has in the past increased the availability of chemicals in North America, as U.S. production that would otherwise have been sold overseas was instead offered for sale domestically, resulting in excess supply and lower prices in North America. We could also face the threat of imported products from countries that have a cost advantage. Furthermore, additional export storage facilities for natural gas liquids, ethane and ethylene may lead to higher exports of such products from the United States orand greater restrictions on hydraulic fracturing could restrict the availability of our raw materials in the United States, thereby increasing our costs.

•general economic and business conditions, including in North America, Europe and Asia, including inflation, persistent high interest rates and possible recession;

•pandemics, such as the COVID-19 pandemic,pandemics and other public health threats and efforts to contain their transmission;

•governmental regulation, including in the United States (including changes due to the new presidential administration),States, Europe and Asia;

•perceptions of our products by potential buyers of our products,customers, as well as the public generally, and related changes in behavior, including with respect to recycling;

•severe weather and natural disasters and the long-term impacts of climate change, including rising sea levels and changes in weather patterns, such as drought and flooding; and

•credit worthinesscreditworthiness of customersour customers, vendors and vendors.business partners.

The North American housing market may remain depressed or decline further, and any such continuation or decline in the homebuilding industry may adversely affect our operating results.

A number of our HIP products are highly dependent on durable goods markets, such as housing and construction, which are themselves particularly cyclical. Weakness in the North American residential housing market and economic weakness in North America, Europe, Asia and the Middle East could have an adverse effect on demand and margins for such products. We cannot predict whether and to what extent the housing market in theNorth United StatesAmerica will grow, particularly if interest rates for mortgage loans remain elevated or continue to rise. New home construction, home renovations and repair and remodel activity are historical demand drivers for many products in our Housing and Infrastructure Products business. Although the U.S. housing market remained strong throughout the COVID-19 pandemic,The demand for home construction, renovations and remodeling began softening at the end of the second quarter of 2022 and has continued to decline throughout 20242025 primarily due to inflationary pricing, high interest rates for mortgage loans, elevated construction costs and the impacts of tariffs on lumber and other raw materials imported into the United States. Other factors that might impact the homebuilding industry include uncertainty in domestic and international financial, credit and consumer lending markets amid slow economic growth or recessionary conditions in various regions or industries around the world, including as a result of the conflicts in the Middle East and between Russia and Ukraine, higher interest rates, tight lending standards and practices for mortgage loans that limit consumers' ability to qualify for mortgage financing to purchase a home, higher home prices, reliance on inadequately capitalized builders and sub-contractors, population declines, unfavorable changes in consumer demographics or preferences, adverse weather conditions, shortages of skilled labor or qualified tradesmen ortradesmen, slower rates of population growth orand U.S. Federal Reserve policy changes. These factors could cause consumers to delay or decline to pursue home ownership, make consumers more price conscious, make consumers more reluctant to invest in their existing homes or cause them to delay investments, including repair and remodel projects, or make it more difficult for consumers to conduct major home renovations.renovations, which could have an adverse effect on our financial condition, results of operations or cash flows, including, but not limited to, the amount of revenues or profits we generate in our Housing and Infrastructure Products segment.

The industries in which we operate are highly competitive. Historically, there have been a number of mergers, acquisitions, spin-offs and joint ventures in the industryindustries in which the PEM businessand operates.HIP businesses operate. This restructuring and consolidation activity has resulted in fewer but more competitive PEM and HIP producers, many of which are larger than we are and have greater financial resources than we do. Among our PEM competitors are some of the world's largest chemical companies and chemical industry joint ventures. Competition within the petrochemical industry and in the manufacturing of housing and infrastructure products is affected by a variety of factors, including:

We are a vertically integrated global manufacturer and marketer of performance and essential materials andboth housing and infrastructure products.products and performance and essential materials. We operate in two principal operating segments, Performance and Essential Materials and Housing and Infrastructure Products.Products The(HIP) and Performance and Essential Materials segment includes Westlake North American Vinyls, Westlake North American Chlor-alkali & Derivatives, Westlake European & Asian Chlorovinyls, Westlake Olefins, Westlake Polyethylene and Westlake Epoxy.(PEM). The Housing and Infrastructure ProductsHIP segment includes Westlake Royal Building Products, Westlake Pipe & Fittings,Fittings and Westlake Global CompoundsCompounds. The PEM segment includes Westlake North American Chlorovinyls, Westlake European & Asian Chlorovinyls, Westlake Olefins and Polyethylene and Westlake Dimex.Epoxy. We are highly integrated along our materials chain with significant downstream integration from ethylene and chlor-alkali (chlorine and caustic soda) into vinyls, polyethylene,polyethylene epoxy(PE) and styrene monomer.epoxy. We also have substantial downstream integration from polyvinyl chloride ("PVC") into our HIP segment for our residential building products, PVC pipespipe and fittingsfittings, and PVC compounds in our Housing and Infrastructure Products segment.compounds.

In April 2024, the U.S. Epoxy Resin Producers Ad Hoc Coalition (the "Coalition"), of which we are a member, filed petitions with the U.S. Department of Commerce and the U.S. International Trade Commission requesting the initiation of antidumping investigations regarding imports of certain epoxy resins from China, India, South Korea, Taiwan, and Thailand and countervailing duty investigations regarding imports of the same products from China, India, South Korea, and Taiwan. In SeptemberMay 2024,2025, the U.S. Department of Commerce published its preliminary countervailing duty determination and imposed provisional duties. In November 2024, the U.S. Department of Commerce published its preliminary antidumping determination of dumping margins. The U.S. Department of Commerce is continuing its antidumping and countervailing duty investigations,orders on imports of epoxy resins from South Korea and Taiwan and an antidumping order on imports of epoxy resins from Thailand. In June 2024, the U.S.Coalition Internationalconfidentially Tradelodged an antidumping complaint with the European Commission isrequesting conductingthe itsinitiation finalof phasean injuryantidumping investigation.investigation concerning imports of epoxy resins into the European Union market originating in China, South Korea, Taiwan and Thailand. The investigationsEuropean areCommission expectedimposed todefinitive concludeduties in Maylate 2025.July 2025 on imports of epoxy resins from China, Taiwan, and Thailand.

Our Housing and Infrastructure ProductsHIP segment is primarily comprised of residential building products, PVC pipespipe and fittingsfittings, and compound products made from PVC compoundand products.other polymers. Our sales are affected by the level of new home constructionsconstruction and home repair and remodeling activity, particularly in North America, as well as the decisions of distributors and dealers on the levels of inventory they carry, their views on product demand, their financial condition and the manner in which they choose to manage inventory risk. A significant portion of our performance in this segment is driven by the activities in the residential construction and repair and remodeling markets in North America, which began to decline at the end of the second quarter of 2022 primarily due to the negative effect that rising mortgage rates in the United States had on buyer sentiment. Since the beginning of 2024, with the stabilization of interest ratesrates, recent interest rate cuts and the possibility of further interest rate cuts by the U.S. Federal Reserve in the near term,Reserve, we have seenexpect improvement in the demand for housing products.products in North America. Performance of our housing and infrastructure productsHIP businesses over time are generally reflective of thereflects trends of building permits and housing starts in the New Residential Construction Survey by the U.S. Census Bureau and the Repair and Remodeling Index (RRI) provided by the National Association of Home Builders (the "NAHB") among others. Although we ultimately expect that the Infrastructure Investment and Jobs Act of 2021 and the preceding historically low level of residential housing construction that has resulted in an undersupply of existing housing may have a favorable long-termfavorably impact on our HousingHIP andsegment Infrastructurein Productsthe segment,long-term, the current inflationary environment impacting consumer spending and priorities and decade-high level of mortgage interest rates impacting consumer affordability are expected to have an unfavorable impact on the demand for housing construction in the near term and, as a result, our products produced by this segment. The following table presents annual historical housing starts per the U.S. Census Bureau and the 2026 and 2027 outlook per the NAHB:

The body of accounting principles generally accepted in the United States is commonly referred to as "GAAP." For this purpose, a non-GAAP financial measure is generally defined by the Securities and Exchange Commission ("SEC") as one that purports to measure historical or future financial performance, financial position or cash flows that (1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of income,operations, balance sheet or statement of cash flows (or equivalent statements) of the registrant; or (2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. In this report, we disclose non-GAAP financial measures, primarily earnings before interest, taxes, depreciation and amortization ("EBITDA") and Free Cash Flow. We define EBITDA as net income (loss) before interest expense, income taxes, depreciation and amortization. We define Free Cash Flow as net cash provided by operating activities less additions to property, plant and equipment. The non-GAAP financial measures described in this Form 10-K are not substitutes for the GAAP measures of earnings and cash flows.

EBITDA and Free Cash Flow are not substitutes for the GAAP measures of net income,income (loss), income (loss) from operations and net cash provided by operating activities and are not necessarily measures of our ability to fund our cash needs. In addition, companies calculate EBITDA and Free Cash Flow differently and, therefore, EBITDA and Free Cash Flow as presented for us may not be comparable to EBITDA and Free Cash Flow reported by other companies. EBITDA has material limitations as a performance measure because it excludes interest expense, depreciation and amortization and income taxes. Free Cash Flow has material limitations as a performance measure because it only considers net cash provided by operating activities, and not net income (loss) or income (loss) from operations. For instance, it applies the entire cost of capital expenditure in the period in which the property or equipment is acquired, rather than spreading it over several periods as is the case with net income (loss) and income from operations.

Reconciliations of EBITDA to net income,income (loss), income (loss) from operations and net cash provided by operating activities, and Free Cash Flow to net cash provided by operating activities, are included in the "Results of Operations" section below.

The table below and descriptions that follow represent the consolidated results of operations of the Company for the years ended December 31, 2024, 20232025 and 2022.2024.

(1)See above for discussions on non-GAAP financial measures. See "Reconciliation of EBITDA to Net Income,Income (Loss), Income (Loss) from Operations and Net Cash Provided by Operating Activities" below.

Reconciliation of EBITDA to Net Income,Income (Loss), Income (Loss) from Operations and Net Cash Provided by Operating Activities

The following table presents the reconciliation of EBITDA to net income,income (loss), income (loss) from operations and net cash provided by operating activities, the most directly comparable GAAP financial measures, for each of the periods indicated.

Gross Profit. Gross profit margin percentage was 16% in 2024 as compared to 18% in 2023. The declinedecrease in gross margin percentage for the year ended December 31, 20242025 as compared to the year ended December 31, 20232024 was primarily due to lower sales volumes and prices for most of our products across both segments,segments whichand washigher partially offset by lower natural gasenergy and feedstock costs.costs The 2023 gross profit margin was impacted byfor the litigationyear chargeended ofDecember $15031, million,2025 as discussedcompared above.to the year ended December 31, 2024.

Non-Binding LetterAcquisition of Intent of a PVC and VCM Production Site in Wilhelmshaven, Germany

On AprilMay 27,29, 2026,2026 the Company provided notice of redemption with respect toredeemed all $496 million aggregate principal amount of its outstanding 3.60% 2026 Senior Notes at a redemption price equal to 100% of the principal amount of the notes being redeemed, plus accrued and unpaid interest tothrough the redemption date, which is May 29, 2026. As of March 31, 2026, $496 million aggregate principal amount of the 3.60% 2026 Senior Notes were outstanding.date.

On April 2, 2026, the Company entered into a credit agreement for an unsecured revolving credit facility in an aggregate principal amount of up to $1.5 billion. The new revolving credit facility replaces the Company's previous $1.5 billion revolving credit facility, which was terminated on April 2, 2026. See Liquidity and Capital Resources—Debt—Credit Agreement,Agreement belowbelow, and Note 8 "Long-Term Debt" to the unaudited consolidated financial statements appearing elsewhere in this Form 10-Q, for more information.

In February 2026, a military conflict primarily involving the United States, Israel and Iran commenced in the Middle East. As a result, the global energy, petrochemical and transportation markets have experienced significant volatility and supply constraints with naphtha based petrochemical producers of petrochemicals in particular facing significantly higher production costs and feedstock supply limitations. Although we do not have operations in the Middle East and the substantial majority of our energy and feedstock requirements are sourced from North America and do not use naphtha-based supply, the ongoing geopoliticaldisruptions conflictto inglobal theshipping regionand elevated logistical costs continue to create inflationary pressures across our broader supply-chain. These disruptions may contribute to continued disruptions in energy and shipping routescontinue for an undeterminable period of time, leading to higher costs for feedstocks,feedstocks and energy and logistics services and heightened inflationary pressures.services. We are continuingactively toassessing assessthese theconditions and their potential impact of the conflict on our global operations. Please also see our Outlook section below for discussion of potential impacts on our HIP and PEM segments.

Our HIP segment is primarily comprised of residential building products, PVC pipe and fittings, and compound products made from PVC and other polymers. Our sales are affected by the level of new home construction and home repair and remodeling activity, particularly in North America, water infrastructure spending for our pipe and fittings business, as well as the decisions of distributors and dealers on the levels of inventory they carry, their views on product demand, their financial condition and the manner in which they choose to manage inventory risk, and customer decision on product selection based on price, aesthetics, and performance among other characteristics..characteristics. Performance of our HIP businesses generally reflects the trends of building permits and housing starts in the New Residential Construction Survey by the U.S. Census Bureau and the Repair and Remodeling Index (RRI) provided by the National Association of Home Builders (the "NAHB") among others. We also expect that the preceding historically low level of residential housing construction that has resulted in an undersupply of existing housing may benefit our HIP segment in the medium to long-term. Furthermore, the ongoing geopolitical volatility in the Middle East has impacted the global supply of crude oil and increased crude oil prices, increasing our distribution and certain raw material costs. A delay in our ability to realize price increases may negatively impact our HIP margins in the near future. Additionally, while recent U.S. Federal Reserve actions to cut interest rates have supported an improved outlook for North American housing demand, a prolonged Middle East conflict and other uncertainties may create sustained inflationary pressures which may impede further interest rate reductions, or cause interest rates to rise, adversely affecting demand for our products and our margins.

Our PEM segment manufactures products such as ethylene, PE, chlor-alkali, chlorinated derivative products, ethylene dichloride, VCM and PVC, many of which are used in our integrated vinyls production chain. The chlor-alkali and petrochemical industries exhibit cyclical commodity characteristics, and margins are influenced by changes in the balance between global supply and demand and the resulting operating rates, the level of general economic activity, turnaround activities and the price of raw materials. We have continued to experience lower prices, increased supply and weaker demand for most of our PEM products globally since 2022. However, the current geopolitical volatility in the Middle East hasdue to the conflict that commenced in February 2026 created feedstock shortages and higher production costs for naphtha-based manufacturers in Asia, driving up global prices for performance and essential materials products. Our North American operations have been less affected by the conflict and hold a competitive advantage due to lower natural gas and power costs, creating opportunities to increase price and supply to domestic and global markets. However, we remain cautious of headwinds impacting our operations in Europe and Asia, including slower economic growth in China, margin compression, and trade disruptions from tariffs. Significant uncertainties remain regarding the duration of the war in Ukraine, the resolution of the Middle East conflict, the subsequent recovery period, return of supply-chain stability in the Middle East and potential broader demand destruction due to inflationary pressures.

The body of accounting principles generally accepted in the United States is commonly referred to as "GAAP." For this purpose, a non-GAAP financial measure is generally defined by the Securities and Exchange Commission ("SEC") as one that purports to measure historical or future financial performance, financial position or cash flows that (1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows (or equivalent statements) of the registrant; or (2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. In this report, we disclose non-GAAP financial measures, primarily earnings before interest, taxes, depreciation and amortization ("EBITDA") and Free Cash Flow. We define EBITDA as net income (loss) before interest expense, income taxes, depreciation and amortization. We define Free Cash Flow as net cash usedprovided forby operating activities less additions to property, plant and equipment. The non-GAAP financial measures described in this Form 10-Q are not substitutes for the GAAP measures of earnings and cash flows.

EBITDA and Free Cash Flow are not substitutes for the GAAP measures of net loss,income (loss), income (loss) from operations and net cash usedprovided forby operating activities and are not necessarily measures of our ability to fund our cash needs. In addition, companies calculate EBITDA and Free Cash Flow differently and, therefore, EBITDA and Free Cash Flow as presented for us may not be comparable to EBITDA and Free Cash Flow reported by other companies. EBITDA has material limitations as a performance measure because it excludes interest expense, depreciation and amortization and income taxes. Free Cash Flow has material limitations as a performance measure because it only considers net cash usedprovided forby operating activities, and not net income (loss) or income (loss) from operations. For instance, it applies to the entire cost of capital expenditure in the period in which the property or equipment is acquired, rather than spreading it over several periods as is the case with net loss and loss from operations.

Reconciliations of EBITDA to net loss,income (loss), income (loss) from operations and net cash usedprovided forby operating activities, and Free Cash Flow to net cash usedprovided forby operating activities are included in the "Results of Operations" section below.

The table below and descriptions that follow represent the consolidated results of operations of the Company for the three and six months ended MarchJune 31,30, 2026 and 2025.

_____________ (1)See above for discussions on non-GAAP financial measures. See "Reconciliation of EBITDA to Net Loss,Income (Loss), Income (Loss) from Operations and Net Cash UsedProvided forby Operating Activities" below.

(2)See above for discussions on non-GAAP financial measures. See "Reconciliation of Free Cash Flow to Net Cash UsedProvided forby Operating Activities" below.

Reconciliation of EBITDA to Net Loss,Income (Loss), Income (Loss) from Operations and Net Cash Used forProvided by Operating Activities

The following table presents the reconciliation of EBITDA to net loss,income (loss), income (loss) from operations and net cash usedprovided forby operating activities, the most directly comparable GAAP financial measures, for each of the periods indicated.

Reconciliation of Free Cash Flow to Net Cash UsedProvided forby Operating Activities

The following table presents the reconciliation of Free Cash Flow to net cash usedprovided forby operating activities, the most directly comparable GAAP financial measure, for each of the periods indicated.

For the second quarter ended MarchJune 31,30, 2026, net lossincome attributable to Westlake Corporation was $169$260 million, or $1.31$2.01 per diluted share, on net sales of $2,652$3,271 million. This represents an increase in net lossincome attributable to Westlake Corporation of $129$402 million, or $1.00$3.12 per diluted share, compared to the second quarter ended MarchJune 31,30, 20252025, net loss attributable to Westlake Corporation of $40$142 million, or $0.31$1.11 per diluted share, on net sales of $2,846$2,953 million. LossIncome from operations was $172$364 million for the quarter ended MarchJune 31,30, 2026, as compared to loss from operations of $32$109 million for the quarter ended MarchJune 31,30, 2025, an increase of $140$473 million. The increase in net lossincome and lossincome from operations was primarily due to lowerhigher sales prices for polyethylene and PVC resin, higher sales volumes for PVC resin, caustic soda, chlorine and building products, lower sales prices for PVC resin, polyethylene and pipe and fittings, caustic soda and higherepoxy resin, and lower fuel costsand inethane feedstock costs. Additionally, the quarter ended March 31, 2026 as compared to March 31, 2025. The increase in net lossincome and lossincome from operations inincluded contribution from the quarterglobal endedcompounding Marchsolutions 31,businesses 2026of the ACI/Perplastic Group (collectively, "ACI"), which was alsoacquired duein toJanuary the recognition of a litigation charge of $67 million related to the settlement of certain PVC pipe antitrust litigation.2026. These decreasespositive contributions were partially offset by higher polyethylene andlower pipe and fittings sales volumesprices andin lowerthe ethanesecond feedstockquarter costs.ended June 30, 2026, as compared to the second quarter ended June 30, 2025. The net lossincome attributable to Westlake Corporation was also negatively affected by higher interest expense in the second quarter ended MarchJune 31,30, 2026, which resulted from a higher average debt balance as compared to the second quarter ended MarchJune 31,30, 2025. The net income and income from operations of the comparable second quarter ended June 30, 2025 were negatively impacted by the recognition of charges of $115 million, related to the closure of the Pernis, Netherlands facility and the closure of operations of the PVC resin unit at the Suzhou Huasu Plastics plant in China.

FirstSecond Quarter 2026 and Six Months Ended June 30, 2026 Compared with FirstSecond Quarter 2025 and Six Months Ended June 30, 2025 (Amounts in tables are in millions of dollars)

Gross Profit. The decreaseincrease in gross profit margin in the firstsecond quarter of 20262026, as compared to the firstsecond quarter of 2025 was primarily due to lowerhigher sales prices for polyethylene and PVC resin, and higher sales volumes for pipe and pricesfittings, forcaustic manysoda, ofand ourepoxy majorresin, productsACI acrossrelated bothcompounds segments,sales highervolumes, and lower fuel costs and theethane recognitionfeedstock of a litigation charge of $67 million related to the settlement of certain PVC pipe antitrust litigation in the first quarter of 2026, as compared to the first quarter of 2025.costs. These decreasespositive contributions were partially offset by lower ethanepipe feedstockand costs.fittings sales prices.

Selling, General and Administrative Expenses. The increase in selling, general and administrative expenses in the firstsecond quarter of 2026 as compared towith the firstsecond quarter of 2025 wasand in the six months ended June 30, 2026 compared with the six months ended June 30, 2025, were primarily due to higher employee compensation, legal and other consulting costsand technology-related expenses. The higher selling, general and higheradministrative technology-relatedexpenses expenses,were also partially offsetdue byto lower chargesACI related to allowance for credit losses.expenses.

Restructuring, Transaction and Integration-related Costs. Restructuring, transaction and integration-related costs in the firstsecond quarter of 2026 primarily consisted of facility closure costs, which are recognized over time,time. relatedThe to the closures of certain North American chlorovinyls facilities, the styrene facility, and the Pernis, Netherlands facility. Restructuring,restructuring, transaction and integration-related costs in the firstsecond quarter of 2025 primarily consistedcomprised of facility$108 million related to the closure costs associated withof the PernisPernis, facility.Netherlands facility and $7 million related to the closure of the PVC resin unit at the Suzhou Huasu Plastics plant located in China.

Interest Expense. Interest expense in the firstsecond quarter of 2026 was higheras compared to the firstsecond quarter of 20252025, and in the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, was higher due to a higher average debt balance as a result of the issuance of $600 million aggregate principal amount of 5.550% senior notes due 2035 and $600 million aggregate principal amount of 6.375% senior notes due 2055 in November 2025. The impact of these debt increases was partially offset by the repurchase of $254 million aggregate principal amount of the outstanding 3.60% 2026 Senior Notes pursuant to a tender offer in November 2025 and the redemption of $496 million aggregate principal amount of the remaining outstanding 3.60% 2026 Senior Notes in May 2026.

Other Income, Net. Other income, net in the firstsecond quarter of 2026 was consistent with the firstsecond quarter of 2025 and in the six months ended June 30, 2026 was consistent with the six months ended June 30, 2025. Other income, net, for all the periods presented primarily comprised of interest income.

Income Taxes. The effective tax raterates were higher in the firstsecond quarter of 2026 wascompared higherto the second quarter of 2025 and in the six months ended June 30, 2026 compared to the firstsix quartermonths ofended 2025June 30, 2025, primarily due to a higher valuation allowance recorded against Westlake Epoxy Netherlands's net operating loss in the firstsecond quarter of 2025.2025 and in the six months ended June 30, 2025 and higher state taxes in the second quarter of 2026 and in the six months ended June 30, 2026.

Net Sales.sales for the HIP segment increased by $89 million in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. Total sales volumes for the HIP segment increased by 7% in the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, due to higher pipe and fittings and ACI compounds sales volumes, partially offset by lower building products sales volumes. Average sales prices for the HIP segment decreased by 2%3% in the firstsix quartermonths ofended June 30, 2026 as compared to the firstsix quartermonths ofended June 30, 2025, primarily due to lower sales prices for pipe and fittings. Total sales volumes for the HIP segment increased by 2% in the first quarter of 2026 as compared to the first quarter of 2025, due to higher pipe and fittings and compounds sales volumes, partially offset by lower building products sales volumes. Lower sales of housing products in the firstsix quartermonths ofended June 30, 2026 waswere primarily due to lower sales volumes for our roofing building products. Higher sales of infrastructure products in the firstsecond quarter of 2026 waswere largely attributable to compounds sold by ACI, which was acquired in the first quarter of 2026.ACI.

Income from Operations. The decrease in income from operations for the HIP segment in the firstsecond quarter of 2026, as compared to the firstsecond quarter of 2025, was primarily due to lower sales prices for pipe and fittingsfittings, and lower sales volumes for building products. The HIP segment performancewhich was also negatively impacted by the recognition of a litigation charge of $67 million related to PVC pipe antitrust litigation settlement for certain plaintiffs in the first quarter of 2026. These decreases were partially offset by higher pipe and fittings and ACI related compounds sales volumes.

Net Sales.sales for the PEM segment increased by $226 million in the second quarter of 2026, compared to the second quarter of 2025. Average sales prices for the PEM segment increased by 14% in the second quarter of 2026, as compared to the second quarter of 2025, due to higher sales prices for polyethylene and PVC resin. Sales volume for the PEM segment decreased by 8%2% in the firstsecond quarter of 20262026, as compared to the firstsecond quarter of 2025, due to lower PVC resin, caustic soda, chlorineresin and styrene sales volumes.volumes, Averagepartially offset by higher caustic soda and epoxy sales pricesvolumes. for the PEM segment decreased by 3% in the first quarter of 2026 as compared to the first quarter of 2025, primarily due to lowerLower PVC resin and polyethylenestyrene sales prices.volumes were due to certain North American plant closures in December 2025 as part of our footprint optimization actions. The lowerhigher Performance Materials sales were primarily due to lowerhigher polyethylene and PVC resin sales pricesprices, andpartially offset by the closure of certain North American vinyl plants in December 2025. The lowerhigher Essential Materials sales were primarily due to lowerhigher caustic soda andsales, chlorinepartially salesoffset andby the closure of the styrene plant in December 2025.

Loss from Operations. The higherincrease lossof $503 million in income from operations for the PEM segment by $48 million was due to lower sales volumes for PVC resin, caustic soda and chlorine, lower sales prices for PVC resin and polyethylene, and higher fuel costs in the firstsecond quarter of 2026 as compared to the firstsecond quarter of 2025. These decreases were partially offset by margin benefits resulting from certain plant closures in 2025 aswas partdue ofto ourhigher footprintsales optimizationprices actionsfor polyethylene and PVC resin and higher sales volumes for caustic soda and epoxy resin, and lower fuel costs and ethane feedstock costs in the firstsecond quarter of 2026 as compared to the firstsecond quarter of 2025.

CASH FLOW DISCUSSION FOR THE THREESIX MONTHS ENDED MARCHJUNE 31,30, 2026 AND 2025

The $17$166 million unfavorablefavorable change in net cash flows from operating activities in the first threesix months of 2026, as compared to the first threesix months of 2025, was mainly due to lowerhigher pricesincome, andas demanddiscussed forunder mostResults of ourOperations productsabove, and unfavorable changes in working capital, offset by a favorable change attributable to the significant cash outflow in connection with the Petro 1 ethylene facility turnaround in the first threesix months of 2025.2025, partially offset by unfavorable changes in working capital. The unfavorable changechanges in working capital in the first threesix months of 2026 waswere substantially driven by the lowerhigher accounts receivables and payable balances primarily associated with plantthe closuresincreased inoperating 2025, partially offset by lower inventory levelsactivities during the threesix months ended MarchJune 31,30, 2026 as compared to the threesix months ended MarchJune 31,30, 2025, and higher accrued and other liabilities as a result of the accrual of $67 million relating to the settlement of certain PVC pipe antitrust litigation, as discussed under Recent Developments above, in the three months ended March 31, 2026.2025.

Net cash used for investing activities in the first threesix months of 2026, as compared to the first threesix months of 2025, decreased by $163$135 million,million. whichThe decrease was primarily due to lower purchases of available-for-sale securities in the first six months of 2026 as compared to our initial investments in available-for-sale securities of $183$192 million in the first threesix months of 2025. Additionally, our capital expenditures were lower by $39$99 million, from $248$515 million in the first threesix months of 2025 to $209$416 million in the first threesix months of 2026. These decreases in cash outflows were partially offset by the payment of $62$171 million, net of cash acquired of $18 million, in connection tofor the acquisitionACI and Wilhelmshaven plant acquisitions in the six months of ACIJune in January30, 2026.

Net cash used for financing activities during the first threesix months of 2026 as compared to first threesix months of 2025 decreasedincreased by $33$507 million, which was primarily due to the repurchaseredemption of common$496 stockmillion foraggregate treasuryprincipal amount of outstanding 3.60% 2026 Senior Notes in May 2026. Other financing activities in the 2025 comparative period. The financing activities during the first threesix months of 2026 included the payment of $68$137 million of cash dividendsdividends, and $10$23 million of cash distributions to noncontrolling interests.interests The financing activities in the first three months of 2025 includedand the repurchase of $30 million of our outstanding common stock for treasury,treasury. $68The financing activities in the first six months of 2025 included $136 million payment of cash dividendsdividends, and $10$23 million of cash distributions to noncontrolling interests.interests and the repurchase of $30 million of our outstanding common stock for treasury.

In November 2014, our Board of Directors authorized a $250 million stock repurchase program (the "2014 Program"). In November 2015, our Board of Directors approved the expansion of the 2014 Program by an additional $150 million. In August 2018, our Board of Directors approved the further expansion of the existing 2014 Program by an additional $150 million. In August 2022, our Board of Directors approved the further expansion of the existing 2014 Program by an additional $500 million. There were repurchases of 1,400355,721 common stock under the 2014 Program during the three months ended MarchJune 31,30, 2026.2026, for an aggregate purchase price of $30 million under the 2014 Program. As of MarchJune 31,30, 2026, we had repurchased 9,929,68310,285,404 shares of our common stock for an aggregate purchase price of approximately $697$727 million under the 2014 Program. Purchases under the 2014 Program may be made either through the open market or in privately negotiated transactions. Decisions regarding the amount and the timing of purchases under the 2014 Program will be influenced by our cash on hand, our cash flows from operations, general market conditions and other factors. The 2014 Program may be discontinued by our Board of Directors at any time.

On October 4, 2018, Westlake Chemical Partners LP ("Westlake Partners") and Westlake Chemical Partners GP LLC, the general partner of Westlake Partners, entered into an Equity Distribution Agreement with UBS Securities LLC, Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., RBC Capital Markets, LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC to offer and sell Westlake Partners common units, from time to time, up to an aggregate offering amount of $50 million. This Equity Distribution Agreement was amended on February 28, 2020 to reference a new shelf registration and subsequent renewals thereof for utilization under this agreement. No common units have been issued under this program as of MarchJune 31,30, 2026.

As of MarchJune 31,30, 2026, our cash and cash equivalents totaled $2,271$1,643 million.

As of MarchJune 31,30, 2026, our available-for-sale securities totaled $205$209 million. See Note 3 "Financial Instruments" to the unaudited consolidated financial statements appearing elsewhere in this Form 10-Q for a discussion of our available-for-sale securities.

In addition to our cash and cash equivalents,equivalents and available-for-sales securities, our credit agreement is available to provide liquidity as needed, as described under "Debt" below.

As of MarchJune 31,30, 2026, the carrying value of our indebtedness totaled $5,570$5,067 million. See Note 8 "Long-Term Debt" to the unaudited consolidated financial statements appearing elsewhere in this Form 10-Q for more information on our long-term indebtedness, credit agreements and defined terms used in this section.

On AprilMay 27,29, 2026, the Company provided notice of redemption with respect toredeemed all $496 million aggregate principal amount of its outstanding 3.60% 2026 Senior Notes at a redemption price equal to 100% of the principal amount of the notes being redeemed, plus accrued and unpaid interest tothrough the redemption date, which is May 9, 2026.date.

The holders of the 3.60% 2026 Senior Notes, the 1.625% 2029 Senior Notes, the 3.375% 2030 Senior Notes, the 3.50% 2032 tax-exempt GO Zone Refunding Senior Notes, the 5.550% 2035 Senior Notes, the 2.875% 2041 Senior Notes, the 5.00% 2046 Senior Notes, the 4.375% 2047 Senior Notes, the 3.125% 2051 Senior Notes, the 6.375% 2055 Senior Notes and the 3.375% 2061 Senior Notes may require us to repurchase the notes at a price equal to 101% of their principal amount, plus accrued and unpaid interest to, but not including, the date of repurchase, upon the occurrence of both a "change of control" and, within 60 days of such change of control, a "below investment grade rating event" (as such terms are defined in the respective indentures governing these notes).