What changed in this filing

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Item 1. Financial Statements

2025-11-06 compared with 2025-08-06 · 113 added, 110 removed, 531 unchanged (30% of the section changed)

2 unchanged sentences

Condensed Consolidated Statements of Operations

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(Dollars in millions, shares in thousands, except per share amounts) 2025 2024 2025 2024

9 unchanged sentences

Interest expense, net ( 35 ) ( 33 ) ( 103 ) ( 69 )

Income (loss) before income taxes 43 53 ( 50 ) 7

Income before income taxes 88 42 38 49

Income tax expense ( 28 ) ( 7 ) ( 45 ) ( 11 )

10 unchanged sentences

GXO Logistics, Inc.

Condensed Consolidated Statements of Comprehensive Income (Loss)

Three Months Ended June 30, Six Months Ended June 30,

Condensed Consolidated Statements of Comprehensive Income

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

5 unchanged sentences

Other comprehensive income (loss), net of tax ( 57 ) 163 140 138

Comprehensive income (loss), net of tax 156 25 130 ( 22 )

Comprehensive income attributable to NCI 5 1 7 1

Comprehensive income (loss) attributable to GXO $ 151 $ 24 $ 123 $ ( 23 )

Comprehensive income, net of tax 3 198 133 176

Comprehensive income (loss) attributable to NCI ( 2 ) 3 5 4

Comprehensive income attributable to GXO $ 5 $ 195 $ 128 $ 172

See accompanying Notes to Condensed Consolidated Financial Statements.

1 unchanged sentence

Condensed Consolidated Balance Sheets

June 30, December 31,

September 30, December 31,

(Dollars in millions, shares in thousands, except per share amounts) 2025 2024

42 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Six Months Ended June 30,

Nine Months Ended September 30,

(In millions) 2025 2024

16 unchanged sentences

Acquisition of businesses, net of cash acquired — ( 863 )

Cross-currency swap agreements settlement ( 1 ) ( 5 )

Net cash used in investing activities ( 169 ) ( 1,107 )

6 unchanged sentences

Taxes paid related to net share settlement of equity awards ( 8 ) ( 8 )

Net changes in bank overdraft positions 64 3

Other ( 2 ) —

6 unchanged sentences

Cash and cash equivalents $ 339 $ 548

Restricted Cash (included in Other current assets) 3 —

Restricted Cash (included in Other long-term assets) 2 21

10 unchanged sentences

dollars in millions) Shares Amount Treasury Stock

Balance as of March 31, 2025 116,955 $ 1 $ ( 111 ) $ 2,635 $ 590 $ ( 245 ) $ 2,870 $ 34 $ 2,904

Balance as of June 30, 2025 114,452 $ 1 $ ( 202 ) $ 2,645 $ 616 $ ( 120 ) $ 2,940 $ 35 $ 2,975

Net income — — — — 59 — 59 1 60

Other comprehensive income — — — — — 125 125 3 128

Other comprehensive loss — — — — — ( 54 ) ( 54 ) ( 3 ) ( 57 )

Stock-based compensation — — — 11 — — 11 — 11

3 unchanged sentences

Dividends to NCI — — — — — — — — —

Balance as of June 30, 2025 114,452 $ 1 $ ( 202 ) $ 2,645 $ 616 $ ( 120 ) $ 2,940 $ 35 $ 2,975

Balance as of September 30, 2025 114,486 $ 1 $ ( 202 ) $ 2,655 $ 675 $ ( 174 ) $ 2,955 $ 33 $ 2,988

Common Stock APIC Retained

11 unchanged sentences

Dividends to NCI — — — — — — — ( 4 ) ( 4 )

Balance as of June 30, 2025 114,452 $ 1 $ ( 202 ) $ 2,645 $ 616 $ ( 120 ) $ 2,940 $ 35 $ 2,975

Balance as of September 30, 2025 114,486 $ 1 $ ( 202 ) $ 2,655 $ 675 $ ( 174 ) $ 2,955 $ 33 $ 2,988

See accompanying Notes to Condensed Consolidated Financial Statements.

6 unchanged sentences

dollars in millions) Shares Amount

Balance as of March 31, 2024 119,368 $ 1 $ 2,602 $ 515 $ ( 249 ) $ 2,869 $ 34 $ 2,903

Balance as of June 30, 2024 119,437 $ 1 $ 2,610 $ 553 $ ( 263 ) $ 2,901 $ 32 $ 2,933

Net income — — — 33 — 33 2 35

Other comprehensive loss — — — — ( 14 ) ( 14 ) — ( 14 )

Other comprehensive income — — — — 162 162 1 163

Stock-based compensation — — 11 — — 11 — 11

1 unchanged sentence

Tax withholding on vesting of stock compensation awards ( 26 ) — ( 1 ) — — ( 1 ) — ( 1 )

Dividends to NCI — — — — — — ( 3 ) ( 3 )

Balance as of June 30, 2024 119,437 $ 1 $ 2,610 $ 553 $ ( 263 ) $ 2,901 $ 32 $ 2,933

Balance as of September 30, 2024 119,472 $ 1 $ 2,620 $ 586 $ ( 101 ) $ 3,106 $ 35 $ 3,141

Common Stock APIC Retained

5 unchanged sentences

Net income — — — 34 — 34 4 38

Other comprehensive loss — — — — ( 24 ) ( 24 ) ( 1 ) ( 25 )

Other comprehensive income — — — — 138 138 — 138

Stock-based compensation — — 30 — — 30 — 30

2 unchanged sentences

Dividends to NCI — — — — — — ( 3 ) ( 3 )

Balance as of June 30, 2024 119,437 $ 1 $ 2,610 $ 553 $ ( 263 ) $ 2,901 $ 32 $ 2,933

Balance as of September 30, 2024 119,472 $ 1 $ 2,620 $ 586 $ ( 101 ) $ 3,106 $ 35 $ 3,141

See accompanying Notes to Condensed Consolidated Financial Statements.

16 unchanged sentences

The amendments are effective prospectively for annual periods beginning after December 15, 2024, and early adoption and retrospective application are permitted.

The Company is currently evaluating the impact of the disclosure requirements about income taxes paid and the rate reconciliation in its Consolidated Financial Statements.

The Company does not expect this standard to have a material impact on its results of operations, financial position or cash flows, other than additional disclosure requirements.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

2 unchanged sentences

This standard is effective for annual reporting periods beginning after December 15, 2026, with early adoption permitted.

The Company is currently evaluating the impact of the disclosure requirements about specific expense categories in its Consolidated Financial Statements.

The Company does not expect this standard to have a material impact on its results of operations, financial position or cash flows, and is currently evaluating the impact of adopting this standard on its disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles- Goodwill and Other- Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software.

The amendments in this Update remove all references to prescriptive and sequential software development stages (referred to as “project stages”) throughout Subtopic 350-40.

Therefore, an entity is required to start capitalizing software costs when certain capitalization criteria are met.

The ASU also supersede guidance on website development costs.

The amendments are effective for all entities for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods.

Early adoption is permitted as of the beginning of an annual reporting period.

The Company is currently evaluating the impact of this standard on its results of operations, financial position or cash flows, and the impact of adopting this standard on its disclosures.

Revenue Recognition

Revenue disaggregated by geographical area was as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

9 unchanged sentences

Revenue disaggregated by industry was as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

8 unchanged sentences

The contract asset and contract liability balances from contracts with customers were as follows:

June 30, December 31,

September 30, December 31,

(In millions) 2025 2024

8 unchanged sentences

Revenue recognized included the following:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

4 unchanged sentences

i) Americas and Asia-Pacific, ii) United Kingdom and Ireland, and iii) Continental Europe.

The Company’s reporting unit results are regularly provided to the chief operating decision maker (“CODM”).

The CODM is our Chief Executive Officer, who assesses the Company’s performance and allocates resources.

The CODM evaluates the Company’s performance and allocates resources primarily based on adjusted earnings before interest, taxes, depreciation and amortization, adjusted for transaction and integration costs, restructuring costs, litigation expense, and unrealized gain/loss on foreign currency contracts and other adjustments (“Adjusted EBITDA”).

The Company’s operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”).

The CODM is our Chief Executive Officer (“CEO”), who assesses the Company’s performance and allocates resources.

In the third quarter of 2025, the Company appointed Patrick Kelleher as its new CEO.

The CODM evaluates the Company’s performance and allocates resources primarily based on adjusted earnings before interest, taxes, depreciation and amortization, adjusted for transaction and integration costs, restructuring costs and other, regulatory matters and litigation expenses, and unrealized gain/loss on foreign currency contracts (“Adjusted EBITDA”).

The CODM uses Adjusted EBITDA to communicate performance targets to the segment managers, allocate resources to the segments, and to monitor segment performance.

3 unchanged sentences

The Company’s segment results were as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

3 unchanged sentences

266 252 769 740

Other (income) expense (2)(4)

Other (income) expense, net (2)(4)

2 ( 2 ) ( 1 ) ( 5 )

7 unchanged sentences

Unrealized (gain) loss on foreign currency contracts (4)

8 ( 1 ) 18 ( 4 )

Interest expense, net 35 33 103 69

Income (loss) before income taxes 43 53 ( 50 ) 7

Income before income taxes 88 42 38 49

Income tax expense ( 28 ) ( 7 ) ( 45 ) ( 11 )

1 unchanged sentence

(1) Excludes unallocated corporate expenses.

(2) Other (income) expense, excluding unrealized (gain) loss on foreign currency contracts.

(2) Other (income) expense, net excluding unrealized (gain) loss on foreign currency contracts.

(3) Corporate expenses include unallocated costs related to corporate functions such as salaries and benefits, rent, and professional fees which are recorded in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.

3 unchanged sentences

The following amounts were recorded in the Condensed Consolidated Balance Sheets related to leases:

June 30, December 31,

September 30, December 31,

(In millions) 2025 2024

10 unchanged sentences

The components of lease expense recorded in the Condensed Consolidated Statements of Operations were as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

12 unchanged sentences

Supplemental cash flow information was as follows:

Six Months Ended June 30,

Nine Months Ended September 30,

(In millions) 2025 2024

2 unchanged sentences

Finance leases, including $ 36 from an acquisition in 2024

Wincanton Acquisition

On April 29, 2024, the Company completed the acquisition of Wincanton plc (now Wincanton Limited) for a total consideration of £ 762 million ($ 958 million as of the acquisition date) (the “Wincanton Acquisition”).

1 unchanged sentence

On June 19, 2025, the CMA approved the Wincanton Acquisition, subject to the divestment of certain grocery contracts in the U.K.

In connection with the Wincanton Acquisition, the Company incurred transaction costs of $ 14 million and $ 11 million for the three months ended June 30, 2025 and 2024, respectively, and $ 35 million and $ 26 million for the six months ended June 30, 2025 and 2024, respectively, which were included in Transaction and integration costs in the Condensed Consolidated Statements of Operations.

In connection with the Wincanton Acquisition, the Company incurred transaction costs of $ 12 million and $ 19 million for the three months ended September 30, 2025 and 2024, respectively, and $ 47 million and $ 45 million for the nine months ended September 30, 2025 and 2024, respectively, which were included in Transaction and integration costs in the Condensed Consolidated Statements of Operations.

The final fair value of assets acquired and liabilities assumed at the acquisition date was:

32 unchanged sentences

The Company does not expect the goodwill recognized in connection with the Wincanton Acquisition to be deductible for income tax purposes.

The following table presents the changes in Goodwill for the six months ended June 30, 2025:

The following table presents the changes in Goodwill for the nine months ended September 30, 2025:

(In millions)

2 unchanged sentences

Impact of foreign exchange translation (2)

Balance as of June 30, 2025

Balance as of September 30, 2025

(1) Represents $ 4 million reduction in goodwill for the purchase price allocation of the Wincanton Acquisition.

(2) Changes to goodwill amounts resulting from foreign currency translation after the acquisition date are presented as the impact of foreign exchange translation.

As of June 30, 2025 and December 31, 2024, there were no accumulated goodwill impairment losses.

As of September 30, 2025 and December 31, 2024, there were no accumulated goodwill impairment losses.

Debt and Financing Arrangements

The following table summarizes the carrying value of the Company’s debt:

June 30, December 31,

September 30, December 31,

(In millions, except percentages) Rate (1)

14 unchanged sentences

Total Long-term debt $ 2,176 $ 2,521

(1) Interest rate as of June 30, 2025.

(2) Net of unamortized discount and debt issuance costs of $ 1 million as of December 31, 2024.

(3) Net of unamortized discount and debt issuance costs of $ 6 million and $ 7 million as of June 30, 2025 and December 31, 2024, respectively.

(4) Net of unamortized discount and debt issuance costs of $ 3 million as of June 30, 2025 and December 31, 2024.

(5) Net of unamortized discount and debt issuance costs of $ 9 million and $ 10 million as of June 30, 2025 and December 31, 2024, respectively.

(1) Interest rate as of September 30, 2025.

(2) Net of unamortized discount and debt issuance costs of zero and $ 1 million as of September 30, 2025 and December 31, 2024, respectively.

(3) Net of unamortized discount and debt issuance costs of $ 6 million and $ 7 million as of September 30, 2025 and December 31, 2024, respectively.

(4) Net of unamortized discount and debt issuance costs of $ 2 million and $ 3 million as of September 30, 2025 and December 31, 2024, respectively.

(5) Net of unamortized discount and debt issuance costs of $ 9 million and $ 10 million as of September 30, 2025 and December 31, 2024, respectively.

(6) On May 16, 2025, the Company repaid the remaining $ 50 million of the Three-Year Term Loan due 2025.

(7) Net of unamortized debt issuance costs of $ 1 million as of June 30, 2025 and December 31, 2024.

(7) Net of unamortized debt issuance costs of $ 1 million as of September 30, 2025 and December 31, 2024.

(8) As of September 30, 2025, current debt includes $ 400 million of Unsecured notes due July 2026.

Revolving Credit Facilities

1 unchanged sentence

The aggregate commitment of all lenders under the Revolving Credit Agreement is equal to $ 800 million, of which $ 100 million is available for the issuance of letters of credit.

As of June 30, 2025, and December 31, 2024, no amounts were outstanding under the Revolving Credit Agreement and letters of credit were $ 1 million under the Revolving Credit Agreement.

In connection with the Wincanton Acquisition, the Company assumed a revolving credit facility agreement (the “Wincanton Revolving Credit Agreement”) under which it may borrow up to £ 175 million ($ 240 million as of

June 30, 2025) in aggregate at any time, expiring in March 2027.

Loans under the Wincanton Revolving Credit Agreement bear interest at daily simple Sterling Overnight Index Average rate plus a margin.

As of June 30, 2025, and December 31, 2024, the Company had £ 26 million ($ 36 million) and £ 15 million ($ 19 million) of borrowings outstanding under the Wincanton Revolving Credit Agreement, respectively.

As of September 30, 2025, and December 31, 2024, no amounts were outstanding, and letters of credit were $ 1 million for both periods under the Revolving Credit Agreement.

Loans under the Wincanton Revolving

Credit Agreement bear interest at daily simple Sterling Overnight Index Average rate plus a margin.

As of September 30, 2025, and December 31, 2024, the Company had £ 48 million ($ 65 million) and £ 15 million ($ 19 million) of borrowings outstanding under the Wincanton Revolving Credit Agreement, respectively.

Covenants and Compliance

1 unchanged sentence

In addition, the facilities require the Company to maintain a consolidated leverage ratio below a specified maximum.

As of June 30, 2025, the Company complied with the covenants contained in its debt and financing arrangements.

Bank Overdraft

As of June 30, 2025, and December 31, 2024, the Company had $ 64 million and zero bank overdrafts, which were reported within Other current liabilities in the Condensed Consolidated Balance Sheets.

As of September 30, 2025, the Company complied with the covenants contained in its debt and financing arrangements.

Factoring Programs

1 unchanged sentence

Information related to the trade receivables sold was as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

1 unchanged sentence

Cash consideration 674 533 2,059 1,182

Net cash provided by operating cash flows

Net cash provided by (used in) operating cash flows

( 27 ) 140 51 158

Fair Value Measurements and Financial Instruments

8 unchanged sentences

The Company bases its fair value estimates on market assumptions and available information.

The carrying values of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and current maturities of long-term debt approximated their fair values as of June 30, 2025 and December 31, 2024, due to their short-term nature.

The carrying values of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and current maturities of long-term debt approximated their fair values as of September 30, 2025 and December 31, 2024, due to their short-term nature.

The fair value of debt was as follows:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(In millions) Level Fair

12 unchanged sentences

The notional amount and fair value of derivative instruments were as follows:

June 30, 2025 December 31, 2024 Balance Sheet Location

September 30, 2025 December 31, 2024 Balance Sheet Location

(In millions) Notional

1 unchanged sentence

Derivatives designated as net investment hedges (1) :

Cross-currency swap agreements (1)

$ — $ — $ 270 $ 12 Other current assets

Cross-currency swap agreements $ — $ — $ 270 $ 12 Other current assets

Cross-currency swap agreements — — 1,177 48 Other long-term assets

Cross-currency swap agreements (2)(3)

372 45 98 7 Other current liabilities

Cross-currency swap agreements (3)

1,652 174 325 2 Other long-term liabilities

Cross-currency swap agreements 624 55 98 7 Other current liabilities

Cross-currency swap agreements 1,400 145 325 2 Other long-term liabilities

Derivatives designated as cash flow hedge:

2 unchanged sentences

Derivatives not designated as hedges (2) :

Foreign currency option contracts (4)

$ 263 $ — $ 300 $ 13 Other current assets

Foreign currency option contracts $ 261 $ 2 $ 300 $ 13 Other current assets

Foreign currency option contracts 37 1 — — Other long-term assets

Foreign currency option contracts 246 6 26 — Other current liabilities

Foreign currency forward contracts 253 2 — — Other current assets

Foreign currency option contracts 39 1 — — Other long-term liabilities

Foreign currency forward contracts 329 1 125 1 Other current liabilities

(1) In February 2025, the Company terminated a cross-currency swap with a notional amount of $ 100 million scheduled to mature in November 2025.

(2) In February 2025, the Company amended one cross-currency swap with a notional amount of $ 98 million to $ 102 million scheduled to mature in December 2025.

(3) In February 2025, the Company entered into three cross-currency swap agreements with an aggregate notional amount of $ 250 million, of which $ 100 million is scheduled to mature in November 2025 and $ 150 million is scheduled to mature in November 2030.

(4) As of June 30, 2025, five foreign currency option contracts not designated as hedges had an aggregate notional amount of $ 27 million and fair value of zero .

As of June 30, 2025 and December 31, 2024, the derivatives were classified as Level 2 within the fair value hierarchy.

(1) During the nine months ended September 30, 2025, the Company terminated a cross-currency swap with a notional amount of $ 100 million scheduled to mature in November 2025, amended one cross-currency swap with a notional amount of $ 98 million to $ 102 million scheduled to mature in December 2025, entered into three cross-currency swap agreements with an aggregate notional amount of $ 250 million, of which $ 100 million is scheduled to mature in November 2025 and $ 150 million are scheduled to mature in November 2030, and amended one cross-currency swap with a notional amount of $ 70 million, extending its maturity from September 2025 to November 2030.

(2) As of September 30, 2025, four foreign currency option contracts not designated as hedges had an aggregate notional amount of $ 25 million and fair value of zero .

As of September 30, 2025 and December 31, 2024, the derivatives were classified as Level 2 within the fair value hierarchy.

The derivatives are valued using inputs other than quoted prices such as foreign exchange rates and yield curves.

The effect of hedges on AOCIL and in the Condensed Consolidated Statements of Operations was as follows:

Three Months Ended June 30, 2025 Six Months Ended June 30, 2025

Three Months Ended September 30, 2025 Nine Months Ended September 30, 2025

(In millions) Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivative Gain (Loss) Reclassified from AOCIL into Net Income (1)

6 unchanged sentences

Interest rate swaps $ — $ — $ — $ ( 2 ) $ — $ —

(1) Amounts reclassified to Net income are reported within Interest expense, net in the Condensed Consolidated Statements of Operations.

Three Months Ended June 30, 2024 Six Months Ended June 30, 2024

(1) Amounts reclassified to Net income are reported in Interest expense, net in the Condensed Consolidated Statements of Operations.

Three Months Ended September 30, 2024 Nine Months Ended September 30, 2024

(In millions) Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivative Gain (Loss) Reclassified from AOCIL into Net Income (1)

6 unchanged sentences

Interest rate swaps $ ( 5 ) $ — $ — $ ( 4 ) $ — $ —

(1) Amounts reclassified to Net income are reported within Interest expense, net in the Condensed Consolidated Statements of Operations.

(1) Amounts reclassified to Net income are reported in Interest expense, net in the Condensed Consolidated Statements of Operations.

Derivatives Not Designated as Hedges

Gains and losses recognized in Other income (expense), net in the Condensed Consolidated Statements of Operations for foreign currency options and forward contracts were as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

2 unchanged sentences

The computations of basic and diluted earnings per share were as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(Dollars in millions, shares in thousands, except per share amounts)

18 unchanged sentences

The repurchase of shares of the Company’s common stock is recorded as treasury stock within equity and is accounted for under the cost method inclusive of share repurchase costs and excise tax on share repurchases in excess of issuances.

For the three and six months ended June 30, 2025, the Company repurchased approximately 2.6 million and 5.4 million shares of its common stock for an aggregate purchase price of $ 91 million and $ 202 million including share repurchase costs and excise tax, respectively.

There were no repurchases of the Company’s common stock during the three months ended September 30, 2025.

For the nine months ended September 30, 2025, the Company repurchased approximately 5.4 million shares of its common stock for an aggregate purchase price of $ 202 million including share repurchase costs and excise tax, respectively.

As of September 30, 2025, the remaining authorization under the Repurchase Plan was $ 300 million.

Accumulated Other Comprehensive Income - Loss

5 unchanged sentences

attributable to

As of March 31, 2025 $ ( 64 ) $ ( 26 ) $ 3 $ ( 159 ) $ 1 $ ( 245 )

As of June 30, 2025 $ 223 $ ( 177 ) $ 3 $ ( 167 ) $ ( 2 ) $ ( 120 )

Other comprehensive income (loss) before reclassifications ( 72 ) 18 — 3 3 ( 48 )

2 unchanged sentences

Other comprehensive income (loss), net of tax ( 73 ) 14 ( 1 ) 3 3 ( 54 )

As of June 30, 2025 $ 223 $ ( 177 ) $ 3 $ ( 167 ) $ ( 2 ) $ ( 120 )

As of September 30, 2025 $ 150 $ ( 163 ) $ 2 $ ( 164 ) $ 1 $ ( 174 )

Foreign Currency Adjustment

8 unchanged sentences

Other comprehensive income (loss), net of tax 345 ( 194 ) ( 2 ) ( 9 ) ( 1 ) 139

As of June 30, 2025 $ 223 $ ( 177 ) $ 3 $ ( 167 ) $ ( 2 ) $ ( 120 )

As of September 30, 2025 $ 150 $ ( 163 ) $ 2 $ ( 164 ) $ 1 $ ( 174 )

Foreign Currency Adjustment

3 unchanged sentences

attributable to

As of March 31, 2024 $ ( 124 ) $ ( 20 ) $ 6 $ ( 111 ) $ — $ ( 249 )

As of June 30, 2024 $ ( 145 ) $ ( 13 ) $ 6 $ ( 111 ) $ — $ ( 263 )

Other comprehensive income (loss) before reclassifications 227 ( 71 ) ( 5 ) ( 7 ) ( 1 ) 143

2 unchanged sentences

Other comprehensive income (loss), net of tax 227 ( 54 ) ( 4 ) ( 6 ) ( 1 ) 162

As of June 30, 2024 $ ( 145 ) $ ( 13 ) $ 6 $ ( 111 ) $ — $ ( 263 )

As of September 30, 2024 $ 82 $ ( 67 ) $ 2 $ ( 117 ) $ ( 1 ) $ ( 101 )

Foreign Currency Adjustment

8 unchanged sentences

Other comprehensive income (loss), net of tax 165 ( 20 ) ( 3 ) ( 4 ) — 138

As of June 30, 2024 $ ( 145 ) $ ( 13 ) $ 6 $ ( 111 ) $ — $ ( 263 )

As of September 30, 2024 $ 82 $ ( 67 ) $ 2 $ ( 117 ) $ ( 1 ) $ ( 101 )

Employee Benefit Plans

9 unchanged sentences

Retirement Plans were as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

1 unchanged sentence

Expected return on plan assets 29 29 83 65

Amortization of prior service cost — 1 — 1

Amortization of net loss ( 1 ) ( 1 ) ( 4 ) ( 3 )

6 unchanged sentences

Defined contribution plan costs were as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2025 2024 2025 2024

3 unchanged sentences

Restructuring Costs and Other

Restructuring costs and other were primarily related to severance in connection with actions taken to optimize certain administrative functions.

The following table summarizes changes in the restructuring liability, which is included in Other current liabilities in the Condensed Consolidated Balance Sheets:

Restructuring costs and other were primarily related to severance paid to the Company’s executive team, as well as actions taken to optimize certain administrative functions.

The following table summarizes changes in the restructuring liability, which is included in Accrued expenses and Other long-term liabilities in the Condensed Consolidated Balance Sheets.

(In millions)

3 unchanged sentences

Other reductions, net ( 3 )

Balance as of June 30, 2025

As of June 30, 2025, $ 12 million of the restructuring liability is expected to be paid within the next 12 months.

Income tax expense for the three months ended June 30, 2025 and 2024, was $ 15 million and $ 14 million, respectively, and the Company’s effective tax rate for the three months ended June 30, 2025 and 2024, was 34.6 %, and 25.4 %, respectively.

The increase in the Company’s effective tax rate was primarily driven by a decrease in pre-tax income.

Income tax expense for the six months ended June 30, 2025 and 2024, was $ 17 million and $ 4 million, respectively, and the Company’s effective tax rate for the six months ended June 30, 2025 and 2024, was an expense on a pre-tax loss of ( 35.3 )% and an expense on pre-tax income of 52.3 %, respectively.

The change in the Company’s effective tax rate was primarily driven by a decrease in pre-tax income, offset by non-deductible regulatory matter and transaction costs.

On July 4, 2025, the One Big Beautiful Bill Act (P.L.

119-21) was signed into law.

The legislation has multiple effective dates, with certain provisions effective in 2025 and others effective through 2027.

The Company is currently assessing its impact on its Consolidated Financial Statements.

Balance as of September 30, 2025

As of September 30, 2025, $ 15 million of the restructuring liability is expected to be paid in the next 12 months.

Income tax expense for the three months ended September 30, 2025 and 2024, was $ 28 million and $ 7 million, respectively, and the Company’s effective tax rate for the three months ended September 30, 2025 and 2024, was 31.2 %, and 16.5 %, respectively.

The change in the Company’s effective tax rate was primarily driven by a jurisdictional shift in pre-tax income.

Income tax expense for the nine months ended September 30, 2025 and 2024, was $ 45 million and $ 11 million, respectively, and the Company’s effective tax rate for the nine months ended September 30, 2025 and 2024, was 118.1 % and 21.9 %, respectively.

The change in the Company’s effective tax rate was primarily driven by a non-deductible regulatory matter in 2025.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law.

The legislation includes reinstatement of favorable tax treatment for certain business provisions including 100% bonus depreciation for qualified property placed in service after January 19, 2025, immediate expensing of domestic research and experimental costs, and revisions to the business interest expense limitations.

The Company is evaluating the full effects of the legislation on its financial statements.

The Company anticipates potential cash tax savings with an immaterial impact on its effective tax rate.

In 2021, the Organization for Economic Co-operation and Development (“OECD”) issued administrative guidance for the Pillar Two Global Anti-Base Erosion rules (“Pillar Two”), which generally imposes a 15% global minimum tax on multinational companies.

The Company has incorporated the estimated annual effect of Pillar Two into its income tax provision for the three and six months ended June 30, 2025, and the Company expects to incur additional income tax related to Pillar Two during fiscal 2025.

For the three and the six months ended June 30, 2024, Pillar Two did not have a material impact on the Company’s income tax expense.

Pillar Two did not have a material impact on the Company’s fiscal 2024 income tax expense.

The Company continues to monitor Pillar Two developments, including the impact of the statement issued by the G7 on June 28, 2025 regarding the interplay between the U.S.

The Company has incorporated the estimated annual effect of Pillar Two into its income tax provision for the three and nine months ended September 30, 2025, and the Company expects to incur additional income tax related to Pillar Two during fiscal 2025.

For the three and the nine months ended September 30, 2024, Pillar Two did not have a material impact on the Company’s income tax expense.

The Company continues to monitor Pillar Two developments, including the impact of the statement issued by the Group of Seven (“G7”) on June 28, 2025 regarding the interplay between the U.S.

international tax system and Pillar Two as it relates to U.S.-headquartered companies.

4 unchanged sentences

The Company reviews and adjusts accruals for loss contingencies quarterly and as additional information becomes available.

If a loss is not both probable and

reasonably estimable, or if an exposure to a loss exists in excess of the amount accrued, the Company assesses whether there is at least a reasonable possibility that a loss, or additional loss, may have been incurred.

If a loss is not both probable and reasonably estimable, or if an exposure to a loss exists in excess of the amount accrued, the Company assesses whether there is at least a reasonable possibility that a loss, or additional loss, may have been incurred.

If there is a reasonable possibility that a loss, or additional loss, may have been incurred, the Company discloses the estimate of the possible loss or range of loss if it is material and an estimate can be made, or discloses that such an estimate cannot be made.

10 unchanged sentences

In the second quarter of 2025, the Company agreed and made final payments of € 59 million ($ 68 million) to the Italian authorities and released any remaining restrictions on this cash account.

And for the three and six months ended June 30, 2025, the Company released $ 1 million and recorded $ 65 million, respectively, of expenses, including legal fees, related to this matter, which was recorded within the Regulatory matter and litigation expense line in the Condensed Consolidated Statements of Operations.

For the three and nine months ended September 30, 2025, the Company recorded zero and $ 65 million, respectively, of expenses, including legal fees, related to this matter, which was recorded within the Regulatory matter and litigation expense line in the Condensed Consolidated Statements of Operations.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements