What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-02-12 compared with 2025-02-13 · 449 added, 486 removed, 1800 unchanged (34% of the section changed)

30 unchanged sentences

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Interim and Annual Goodwill Impairment Assessments for Certain Reporting Units

As described in Notes 2 and 8 to the consolidated financial statements, the Company’s goodwill balance was $28.7 billion as of December 28, 2024, a significant portion of which related to certain reporting units, Taste Elevation, Ready Meals, and Snacking (TMS), Away from Home & Kraft Heinz Ingredients (AFH), Meat & Cheese (MC), Canada and North America Coffee (CNAC), and Continental Europe (CE).

Interim (Q2) and Annual Goodwill Impairment Assessments for Certain Reporting Units

As described in Notes 2 and 9 to the consolidated financial statements, the Company’s goodwill balance was $22.2 billion as of December 27, 2025, a significant portion of which related to certain reporting units, Elevation;

Hydration, Desserts, & Meals (HDM);

Western Europe (WE);

and Meat, Cheese, Coffee, & Snacks (MCCS).

Management tests reporting units for impairment annually as of the first day of the third quarter, or more frequently if events or circumstances indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

1 unchanged sentence

If the carrying amount of a reporting unit exceeds its estimated fair value, an impairment loss is recorded based on the difference between the fair value and carrying amount, not to exceed the associated carrying amount of goodwill.

Management recognized non-cash goodwill impairment losses of $1.6 billion for the year ended December 28, 2024, a significant portion of which related to the AFH, MC, and CE reporting units.

As a result of the interim impairment test performed in the second quarter of 2025, management recognized non-cash goodwill impairment losses of $6.7 billion all of which related to the Taste Elevation, Ready Meals, and Snacking (TMS);

Meat & Cheese (MC);

Western Europe (WE);

Canada and North America Coffee (CNAC);

and Away from Home & Kraft Heinz Ingredients (AFH) reporting units.

Management utilizes the discounted cash flow method under the income approach to estimate the fair value of reporting units.

Management’s cash flow projections included significant assumptions related to net sales, cost of products sold, selling, general, and administrative costs (SG&A), depreciation and amortization, working capital, capital expenditures, income tax rates, discount rates, long-term growth rates, royalty rates, and other market factors.

The principal considerations for our determination that performing procedures relating to the interim goodwill impairment assessments (for TMS, AFH, and MC) and annual goodwill impairment assessments (for TMS, AFH, MC, CNAC, and CE) is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the reporting units;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to net sales, cost of products sold, SG&A, discount rate, long-term growth rate, and royalty rate, as applicable to the reporting unit;

The principal considerations for our determination that performing procedures relating to the interim goodwill impairment assessments in the second quarter of 2025 (for TMS, AFH, WE, MC, and CNAC) and the annual goodwill impairment assessments (for Elevation, HDM, WE, and MCCS) is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the reporting units;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to net sales, cost of products sold, SG&A, income tax rate, discount rate, long-term growth rate, and royalty rate, as applicable to the reporting unit;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s goodwill impairment assessments, including controls over the valuation of the TMS, AFH, MC, CNAC, and CE reporting units.

These procedures also included, among others (i) testing management’s process for developing the fair value estimate of the reporting units;

1 unchanged sentence

(iii) testing the completeness and accuracy of underlying data used in the method;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to net sales, cost of products sold, SG&A, discount rate, long-term growth rate, and royalty rate, as applicable to the reporting unit.

Evaluating management’s assumptions related to net sales, cost of products sold, SG&A, royalty rates, discount rates, and long-term growth rates involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting units;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to net sales, cost of products sold, SG&A, income tax rate, discount rate, long-term growth rate, and royalty rate, as applicable to the reporting unit.

Evaluating management’s assumptions related to net sales, cost of products sold, SG&A, income tax rates, royalty rates, discount rates, and long-term growth rates involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting units;

(ii) the consistency with external market and industry data;

1 unchanged sentence

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the Company’s discounted cash flow method and (ii) the reasonableness of the discount rate and long-term growth rate assumptions, as applicable to the reporting unit.

Annual Impairment Assessments for Certain Indefinite-Lived Intangible Assets– Individual Brands

As described in Notes 2 and 8 to the consolidated financial statements, the Company’s indefinite-lived intangible assets balance, which consists primarily of individual brands, was $36.5 billion as of December 28, 2024, a portion of which related to certain brands, Kraft , Velveeta , Oscar Mayer , and Lunchables .

Interim (Q2) and Annual Impairment Assessments for Certain Indefinite-Lived Intangible Assets– Individual Brands

As described in Notes 2 and 9 to the consolidated financial statements, the Company’s indefinite-lived intangible assets balance, which consists primarily of individual brands, was $34.2 billion as of December 27, 2025, a portion of which related to certain brands, Kraft, Velveeta, Oscar Mayer, Lunchables, and Capri Sun .

Management tests brands for impairment annually as of the first day of the third quarter, or more frequently if events or circumstances indicate it is more likely than not that the fair value of a brand is less than its carrying amount.

1 unchanged sentence

If the carrying amount of a brand exceeds its estimated fair value, an impairment loss is recorded based on the difference between the fair value and carrying amount.

As a result of its annual impairment test, management recognized non-cash indefinite-lived intangible asset impairment losses of $0.6 billion for the year ended December 28, 2024.

As a result of the interim impairment test performed in the second quarter of 2025, management recognized non-cash indefinite-lived intangible asset impairment losses

of $2.6 billion, a significant portion of which related to the Kraft , Velveeta and Lunchables brands.

As disclosed by management, management utilizes either an excess earnings method or relief from royalty method to estimate the fair value of its brands.

Using the excess earnings method, management’s cash flow projections included significant

assumptions relating to net sales, cost of products sold, SG&A, contributory asset charges, income tax considerations, long-term growth rates, discount rates, and other market factors.

Using the excess earnings method, management’s cash flow projections included significant assumptions relating to net sales, cost of products sold, SG&A, contributory asset charges, income tax considerations, long-term growth rates, discount rates, and other market factors.

Using the relief from royalty method, management’s cash flow projections included significant assumptions related to net sales, royalty rates, income tax considerations, long-term growth rates, discount rates, and other market factors.

The principal considerations for our determination that performing procedures relating to the annual indefinite-lived intangible impairment assessments (for Kraft , Velveeta , Oscar Mayer , and Lunchables ) is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the brands;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to (a) net sales, cost of products sold, SG&A, and long-term growth rates, as applicable to the brand, for the excess earnings method and (b) net sales and royalty rates, as applicable to the brand, for the relief from royalty method;

The principal considerations for our determination that performing procedures relating to the interim goodwill impairment assessments in the second quarter of 2025 (for Kraft, Velveeta, Oscar Mayer , and Lunchables ) and the annual indefinite-lived intangible impairment assessments (for Kraft, Velveeta, Oscar Mayer, Lunchables, and Capri Sun ) is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the brands;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to (a) net sales, cost of products sold, SG&A, discount rates, and long-term growth rates, as applicable to the brand, for the excess earnings method and (b) net sales, discount rates, and royalty rates, as applicable to the brand, for the relief from royalty method;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s indefinite-lived intangible assets impairment assessment, including controls over the valuation of the Kraft , Velveeta , Oscar Mayer , and Lunchables brands.

These procedures included testing the effectiveness of controls relating to management’s indefinite-lived intangible assets impairment assessments, including controls over the valuation of the Kraft, Velveeta, Oscar Mayer, and Lunchables brands on an interim basis and Kraft, Velveeta, Oscar Mayer, Lunchables and Capri Sun brands on an annual basis.

These procedures also included, among others (i) testing management’s process for developing the fair value estimate of the brands;

1 unchanged sentence

(iii) testing the completeness and accuracy of underlying data used in the methods;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to (a) net sales, cost of products sold, SG&A, and long-term growth rates, as applicable to the brand, used for the excess earnings method and (b) net sales and royalty rates, as applicable to the brand, used for the relief from royalty method.

Evaluating management’s assumptions related to net sales, cost of products sold, SG&A, and long-term growth rates for the excess earnings method and net sales and royalty rates for the relief from royalty method involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the brand;

(ii) the consistency with external market and industry data;

and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the Company’s excess earnings and relief from royalty methods and (ii) the reasonableness of the long-term growth rate assumption for the excess earnings method and the reasonableness of the royalty rates assumption for the relief from royalty method.

Valuation of Non-US Deferred Tax Asset Related to the Change in Entity Structure

As described in Note 9 to the consolidated financial statements, the Company enacted changes to its corporate entity structure, which included a transfer of and will result in the movement of certain business operations to a wholly-owned subsidiary in the Netherlands, resulting in a tax benefit of $3 billion recorded as a non-U.S.

deferred tax asset in December 2024.

The deferred tax asset was recognized as a result of the book and tax basis difference on the business transferred, with the tax basis determined by reference to the fair value of the business.

As disclosed by management, management used the discounted cash flow method to estimate the fair value of the business and made significant assumptions related to net sales, discount rate, long-term growth rate, income tax rates, and other market factors.

The recognition of the future tax benefits associated with the transaction are dependent upon the acceptance of the business valuation and tax step-up by the associated taxing authorities.

The principal considerations for our determination that performing procedures relating to the valuation of the non-US deferred tax asset related to the change in entity structure is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the business and related value of the deferred tax asset;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating the recognition of future tax benefits and management’s significant assumptions related to net sales, discount rate, long-term growth rate, and income tax rates;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s assessment of the valuation of the non-US deferred tax asset related to the change in entity structure, including controls over the valuation of the business transferred.

These procedures also included, among others (i) evaluating the positive and negative evidence available to assess management’s assessment of the realizability of the deferred tax asset related to the change in entity structure;

(ii) testing management’s process for developing the fair value estimate of the business, (iii) evaluating the appropriateness of the discounted cash flow method;

(iv) testing the completeness and accuracy of underlying data used in the method;

and (v) evaluating the reasonableness of the significant assumptions used by management related to net sales, discount rate, long term growth rate, and income tax rates.

Evaluating management’s significant assumptions related to net sales, discount rate, and long-term growth rate involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the transferred business;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to (a) net sales, cost of products sold, SG&A, discount rates, and long-term growth rates, as applicable to the brand, used for the excess earnings method and (b) net sales, discount rates, and royalty rates, as applicable to the brand, used for the relief from royalty method.

Evaluating management’s assumptions related to net sales, cost of products sold, SG&A, discount rates, and long-term growth rates for the excess earnings method and net sales, discount rates, and royalty rates for the relief from royalty method involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the brand;

(ii) the consistency with external market and industry data;

and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the Company’s

discounted cash flow method;

(ii) the reasonableness of the discount rate, income tax rates, and long-term growth rate assumptions;

and (iii) the recognition of future tax benefits associated with this transaction.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the Company’s excess earnings and relief from royalty methods and (ii) the reasonableness of the discount rate and long-term growth rate assumptions for the excess earnings method and the reasonableness of the discount rate and royalty rate assumptions for the relief from royalty method.

/s/ PricewaterhouseCoopers LLP

57 unchanged sentences

Prepaid expenses 291 215

Marketable securities 1,060 —

Other current assets 588 583

Assets held for sale 152 —

Total current assets 10,127 7,655

10 unchanged sentences

Other current liabilities 1,455 1,451

Liabilities held for sale 8 —

Total current liabilities 8,778 7,253

11 unchanged sentences

Additional paid-in capital 51,287 52,135

Retained earnings

Retained earnings/(deficit)

( 4,629 ) 2,171

Accumulated other comprehensive income/(losses) ( 2,370 ) ( 2,915 )

16 unchanged sentences

— — ( 1,977 ) — — — ( 1,977 )

Dividends declared-noncontrolling interest ($ 100.30 per share)

— — — — — ( 7 ) ( 7 )

Exercise of stock options, issuance of other stock awards, repurchase of common stock, and other — 203 — — ( 439 ) 9 ( 227 )

5 unchanged sentences

— — ( 1,940 ) — — — ( 1,940 )

Exercise of stock options, issuance of other stock awards, repurchase of common stock, and other — 203 — — ( 439 ) 9 ( 227 )

Dividends declared-noncontrolling interest ($ 98.77 per share on January 31, 2024 and $ 95.03 per share on December 11, 2024)

— — — — — ( 14 ) ( 14 )

Repurchase of common stock

— — — — ( 939 ) — ( 939 )

Exercise of stock options, issuance of other stock awards, and other

— 98 — — 7 4 109

Balance at December 28, 2024

4 unchanged sentences

— ( 952 ) ( 954 ) — — — ( 1,906 )

Dividends declared-noncontrolling interest ($ 98.77 per share on January 31, 2024 and $ 95.03 per share on December 11, 2024)

Dividends declared-noncontrolling interest ($ 92.08 per share)

— — — — — ( 6 ) ( 6 )

22 unchanged sentences

Loss/(gain) on sale of business 42 81 ( 4 )

Loss/(gain) on extinguishment of debt — — ( 38 )

Other items, net ( 3 ) ( 46 ) 207

8 unchanged sentences

Capital expenditures ( 801 ) ( 1,024 ) ( 1,013 )

Payments to acquire business, net of cash acquired — — ( 481 )

Payments to acquire intangible assets

Settlement of net investment hedges 75 31 208

Purchases of marketable securities ( 1,724 ) — —

Proceeds from sale of marketable securities 686 — —

Proceeds from sale of business, net of cash disposed and working capital adjustments 9 8 —

4 unchanged sentences

Proceeds from issuance of long-term debt 1,620 594 657

Debt prepayment and extinguishment benefit/(costs) — — 10

Proceeds from issuance of commercial paper — — 150

2 unchanged sentences

Repurchases of common stock

( 436 ) ( 988 ) ( 455 )

Other financing activities, net 141 ( 65 ) ( 67 )

7 unchanged sentences

Interest $ 903 $ 906 $ 896

Income taxes, net of refunds 967 932 1,260

See accompanying notes to the consolidated financial statements.

13 unchanged sentences

Reportable Segments

In the first quarter of 2024, we divided our International segment into three operating segments — Europe and Pacific Developed Markets (“EPDM” or “International Developed Markets”), West and East Emerging Markets (“WEEM”), and Asia Emerging Markets (“AEM”) — to enable enhanced focus on the different strategies required for each of these regions as part of our long-term strategic plan.

Subsequently, we manage our operating results through four operating segments.

We manage our operating results through four operating segments:

North America, Europe and Pacific Developed Markets (“EPDM” or “International Developed Markets”), West and East Emerging Markets (“WEEM”), and Asia Emerging Markets (“AEM”).

We have two reportable segments defined by geographic region:

15 unchanged sentences

Held for Sale

At December 27, 2025, we classified certain assets and liabilities as held for sale in our consolidated balance sheet, primarily relating to the divestiture of our infant and specialty food business in Italy in our International Developed Markets segment.

At December 28, 2024, assets classified as held for sale were insignificant.

At December 30, 2023, we classified certain assets as held for sale recorded in other current assets in our consolidated balance sheet, primarily relating to land use rights across the globe.

See Note 5, Acquisitions and Divestitures , for additional information.

Cash , Cash Equivalents , and Restricted Cash

5 unchanged sentences

The year-over-year increase was due to the conversion of certain assets related to the U.S.

postretirement medical plan to cash.

postretirement medical plan to cash, partially offset by claim payments for active and retired employees as a result of the conversion.

See Note 12, Postemployment Benefits , for additional information.

24 unchanged sentences

Stock-Based Compensation:

We recognize compensation costs related to equity awards on a straight-line basis over the vesting period of the award, which is generally three to five years , or on a straight-line basis over the requisite service period for each separately vesting portion of the awards.

We recognize compensation costs related to equity awards on a straight-line basis over the vesting period of the award, which is generally three to four years , or on a straight-line basis over the requisite service period for each separately vesting portion of the awards.

These costs are primarily recognized within SG&A.

3 unchanged sentences

Divestiture-Related License Income:

In 2020, we entered into a definitive agreement with a third party, an affiliate of Groupe Lactalis (“Lactalis”) to sell certain assets in our global cheese business, as well as to license the Kraft , Velveeta and Philadelphia trademarks, for a total consideration of approximately $ 3.3 billion.

In 2021, we finalized a transaction with a third party, an affiliate of Groupe Lactalis (“Lactalis”) to sell certain assets in our global cheese business, as well as to license the Kraft , Velveeta and Philadelphia trademarks, for a total consideration of approximately $ 3.3 billion.

Of the $ 3.3 billion total consideration, approximately $ 1.6 billion was attributed to the licensing of the Kraft , Velveeta and Philadelphia trademarks based on the estimated fair value of the licensed portion of each brand.

1 unchanged sentence

The license income related to the transitional license of the Philadelphia brand was recognized over a period of approximately three years .

We recognized license income of approximately $ 54 million in 2024 and 2023, and $ 56 million in 2022, which is recorded as a reduction to SG&A.

Related to this agreement, we have recorded approximately $ 1.4 billion in long-term deferred income and $ 54 million in other current liabilities at December 28, 2024, and $ 1.4 billion in long-term deferred income and $ 55 million in other current liabilities at December 30, 2023 on the consolidated balance sheet.

We recognized license income of approximately $ 52 million in 2025, and $ 54 million in 2024 and 2023, which is recorded as a reduction to SG&A.

Related to this agreement, we have recorded approximately $ 1.3 billion in long-term deferred income and $ 54 million in other current liabilities at December 27, 2025, and $ 1.4 billion in long-term deferred income and $ 54 million in other current liabilities at December 28, 2024 on the consolidated balance sheets.

Postemployment Benefit Plans:

10 unchanged sentences

We also recognize deferred tax assets for temporary differences, operating loss carryforwards, and tax credit carryforwards.

Deferred tax assets are included in other non-current assets on the consolidated balance sheet.

Deferred tax assets are included in other non-current assets on the consolidated balance sheets.

Inherent in determining our annual tax rate are judgments regarding business plans, planning opportunities, and expectations about future outcomes.

16 unchanged sentences

Capitalized software costs are included in property, plant and equipment if we have the contractual right to take possession of the software at any time and it is feasible for us to either run the software on our own hardware or contract with a third party to host the software.

These costs are amortized on a straight-line basis over the estimated useful lives of the software, which do not exceed seven years .

These costs are amortized on a straight-line basis over the estimated useful lives of the software, which do not exceed 10 years.

We review long-lived assets for impairment when conditions exist that indicate the carrying amount of the assets may not be fully recoverable.

11 unchanged sentences

Such conditions could include situations where the arrangement is not expected to provide substantive service potential, a significant change occurs in the manner in which the arrangement is used or expected to be used, including early cancellation or termination of the arrangement, or situations where the arrangement has had, or will have, a significant change made to it.

In instances where we have concluded that an impairment exists, we accelerate the deferred costs on the consolidated balance sheet for immediate expense recognition in SG&A.

In instances where we have concluded that an impairment exists, we accelerate the deferred costs on the consolidated balance sheets for immediate expense recognition in SG&A.

Goodwill and Intangible Assets :

We maintain 12 reporting units, eight of which comprise our goodwill balance.

We maintain 10 reporting units globally, six of which comprise our goodwill balance.

Our indefinite-lived intangible asset balance primarily consists of a number of individual brands.

13 unchanged sentences

We determine whether a contract is or contains a lease at contract inception based on the presence of identified assets and our right to obtain substantially all the economic benefit from and to direct the use of such assets.

When we determine a lease exists, we record a right-of-use (“ROU”) asset and corresponding lease liability on our consolidated balance sheet.

When we determine a lease exists, we record a right-of-use (“ROU”) asset and corresponding lease liability on our consolidated balance sheets.

ROU assets represent our right to use an underlying asset for the lease term.

13 unchanged sentences

Certain leasing arrangements require variable payments that are dependent on usage or output or may vary for other reasons, such as insurance and tax payments.

Variable lease payments that do not depend on an index or rate are excluded from lease payments in the measurement of the ROU asset and lease liability and are recognized as expense in the period in which the payment occurs.

Our lease agreements typically do not include significant restrictions or covenants, and residual value guarantees are generally not included within our leases.

1 unchanged sentence

Financial Instruments:

Derivatives and hedging instruments:

As we source our commodities on global markets and periodically enter into financing or other arrangements abroad, we use a variety of risk management strategies and financial instruments to manage commodity price, foreign currency exchange rate, and interest rate risks.

2 unchanged sentences

As a matter of policy, we do not use highly leveraged derivative instruments, nor do we use financial instruments for speculative purposes.

Derivatives are recorded on our consolidated balance sheets as assets or liabilities at fair value, which fluctuates based on changing market conditions.

Derivatives are recorded on our consolidated balance sheets as assets or liabilities at fair value, which fluctuate based on changing market conditions.

Certain derivatives are designated as cash flow hedges or fair value hedges and qualify for hedge accounting treatment, while others are not designated as hedging instruments and are marked to market through net income/(loss).

6 unchanged sentences

The excluded component on derivatives designated as net investment hedges is recognized in net income/(loss) within interest expense.

The income statement classification of gains and losses related to derivative instruments not designated as hedging instruments is determined based on the underlying intent of the contracts.

statement classification of gains and losses related to derivative instruments not designated as hedging instruments is determined based on the underlying intent of the contracts.

Cash flows related to the settlement of derivative instruments designated as net investment hedges of foreign operations are classified in the consolidated statements of cash flows within investing activities.

All other cash flows related to derivative instruments are classified in the same line item as the cash flows of the related hedged item, which can be within operating, investing, or financing activities.

All other cash flows related to derivative instruments are classified in the same caption as the cash flows of the related hedged item, which can be within operating, investing, or financing activities.

To qualify for hedge accounting, a specified level of hedging effectiveness between the hedging instrument and the item being hedged must be achieved at inception and maintained throughout the hedged period.

33 unchanged sentences

We also occasionally use futures to economically cross hedge a commodity exposure.

Available-for-sale securities:

We invest in certain marketable fixed-income debt securities that are classified as available-for-sale.

Our available-for-sale securities are reported at fair value based on pricing models and quoted market prices adjusted for credit and non-performance risk.

Highly liquid investments with maturities of 90 days or less are included in cash and cash equivalents on our consolidated balance sheets.

Investments with maturities of greater than 90 days but less than 12 months are presented as marketable securities on our consolidated balance sheets.

We did not hold any investments with maturities exceeding 12 months.

Unrealized holding gains/(losses) are deferred into accumulated other comprehensive income/(losses) until the security is settled or sold.

We regularly evaluate our available-for-sale debt securities for expected credit and non-credit related losses.

In making these assessments, we evaluate, among other things, the financial condition and credit quality of the issuer, as well as our ability and intent to hold the investment for a period of time sufficient to allow for any anticipated recovery.

Credit-related losses are recognized through other expense/(income) in the period incurred, and non-credit related losses are deferred into accumulated other comprehensive income/(losses) until the related securities are sold.

See Note 13, Financial Instruments , for additional information.

3 unchanged sentences

Income statement accounts are translated at the average rate of exchange prevailing during the period.

Foreign currency translation adjustments arising from the use of differing exchange rates from period to period are included as a component of accumulated other comprehensive income/(losses) on our consolidated balance sheet.

Gains and losses from foreign currency transactions are included in net income/(loss) for the period.

3 unchanged sentences

dollars) based on the legally available exchange rate at which we expect to settle the underlying transactions.

Exchange gains and losses from the remeasurement of monetary assets and liabilities are reflected in other expense/(income) on our consolidated statement of income, rather than accumulated other comprehensive income/(losses) on our consolidated balance sheet, until such time as the economy is no longer considered highly inflationary.

Exchange gains and losses from the remeasurement of monetary assets and liabilities are reflected in other expense/(income) on our consolidated statements of income, rather than accumulated other comprehensive income/(losses) on our consolidated balance sheets, until such time as the economy is no longer considered highly inflationary.

Certain non-monetary assets and liabilities are recorded at the applicable historical exchange rates.

In 2024, we applied highly inflationary accounting to the results of our subsidiaries in Turkey, Venezuela, Argentina, Egypt, and Nigeria which resulted in nonmonetary currency devaluation losses in other expense/(income) of $ 16 million as of December 28, 2024.

In 2023 and 2022, we applied highly inflationary accounting to the results of our subsidiaries in Turkey, Venezuela, and Argentina which resulted in nonmonetary currency devaluation losses in other expense/(income) of $ 28 million as of December 30, 2023, and $ 17 million as of December 31, 2022.

The net monetary assets of each of our subsidiaries in Turkey, Venezuela, Argentina, Egypt, and Nigeria were insignificant at December 28, 2024.

Our results of operations in Turkey, Venezuela, Argentina, Egypt, and Nigeria reflect those of controlled subsidiaries.

We apply highly inflationary accounting to the results of our subsidiaries in Turkey and Venezuela in all years presented, and Egypt in 2025 and 2024.

As a result of applying highly inflationary accounting to the results of our subsidiaries in these countries, we recognized nonmonetary currency devaluation losses in other expense/(income) of $ 34 million as of December 27, 2025, $ 16 million as of December 28, 2024, and $ 28 million as of December 30, 2023.

The net monetary assets of each of our subsidiaries in Turkey, Venezuela, and Egypt were insignificant at December 27, 2025.

Our results of operations in Turkey, Venezuela, and Egypt reflect those of controlled subsidiaries.

Previously Announced Separation Transaction

On September 2, 2025, we announced a plan to separate the Company into two independent, publicly traded companies through a tax-free spin-off (the “Separation”).

On February 11, 2026, we announced that the Kraft Heinz Board of Directors (the “Board”) has decided to pause work related to the Separation.

If completed, the Separation would result in two companies, whose names would be determined at a later date, one of which would focus on Taste Elevation and shelf-stable meals, and the other of which would focus on certain North American staples.

If work related to the Separation is resumed, the Separation would be subject to the satisfaction of customary conditions, including final approval by the Board, receipt of favorable tax opinions of our U.S.

tax advisors with respect to the tax-free nature of the Separation, and the effectiveness of appropriate filings with the U.S.

Securities and Exchange Commission.

The timing of the Separation and whether it will be completed is uncertain and we cannot assure that the Separation will be completed on the anticipated timeline or at all or that the terms of the Separation will not change.

We incurred $ 60 million of separation costs for the year ended December 27, 2025, primarily related to consulting, advisory and employee-related costs.

These costs were recognized in SG&A on our consolidated statements of income.

New Accounting Standards

Accounting Standards Adopted in the Current Year

Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures:

In November 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2023-07 to improve segment disclosure requirements under Accounting Standards Codification (“ASC”) 280, Segment Reporting, through enhancing disclosures about significant segment expenses.

The guidance requires entities to provide significant segment expenses that are regularly provided to the chief operating decision maker and other segment expenses included in each reported measure of segment profitability.

This ASU also enhances interim segment reporting requirements by aligning interim disclosures with information that must be disclosed annually in accordance with ASC 280.

We adopted this ASU in the fourth quarter of 2024 and added certain disclosures in Note 20, Segment Reporting .

The disclosures were applied retrospectively and impacted all prior periods presented.

There was no other impact to our financial statement disclosures as a result of adopting this ASU.

Accounting Standards Not Yet Adopted

Income Taxes (Topic 740) – Improvements to Income Tax Disclosures:

1 unchanged sentence

The guidance requires entities to provide separate information about a reporting entity’s effective tax rate reconciliation and about income taxes paid.

This ASU will be effective for annual periods beginning after December 15, 2024.

The guidance will be applied on a prospective basis with the option to apply the standard retrospectively.

Early adoption is permitted.

While the standard will require additional disclosures related to the Company’s income taxes, we do not expect this ASU to have an impact on our financial statements.

We adopted this ASU in the fourth quarter of 2025 and added the required disclosures on a prospective basis in Note 10, Income Taxes .

There was no other impact to our financial statement disclosures as a result of adopting this ASU.

Accounting Standards Not Yet Adopted

Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40):

3 unchanged sentences

Early adoption is permitted.

We are still evaluating the impacts this ASU will have on our financial statements and related disclosures.

We are currently evaluating the impact this ASU will have on our financial statements and related disclosures.

Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40):

In September 2025, the FASB issued ASU 2025-06 to provide clarification and improvements to the accounting for internal-use software costs under ASC 350-40, Intangibles – Goodwill and Other – Internal-Use Software .

The guidance includes amendments related to capitalization of implementation costs, subsequent measurement, and related presentation and disclosure requirements.

This ASU will be effective for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years.

Early adoption is permitted.

We are currently evaluating the impact this ASU will have on our financial statements and related disclosures.

Acquisitions and Divestitures

Hemmer Acquisition:

On March 31, 2022 (the “Hemmer Acquisition Date”), we acquired a majority of the outstanding equity interests of Companhia Hemmer Indústria e Comércio (“Hemmer”), a Brazilian food and beverage manufacturing company focused on the condiments and sauces category, from certain third-party shareholders (the “Hemmer Acquisition”).

The Hemmer Acquisition was accounted for under the acquisition method of accounting for business combinations.

Total cash consideration related to the Hemmer Acquisition was approximately 1.3 billion Brazilian reais (approximately $ 279 million at the Hemmer Acquisition Date).

A noncontrolling interest was recognized at fair value, which was determined to be the noncontrolling interest’s proportionate share of the acquiree’s identifiable net assets, as of the Hemmer Acquisition Date.

As of the Hemmer Acquisition Date, we acquired 94 % of the outstanding shares of Hemmer.

In the third quarter of 2022, we completed the redemption of the remaining outstanding shares and own 100 % of the controlling interest in Hemmer.

We entered into foreign exchange derivative contracts to economically hedge the foreign currency exposure related to the cash consideration for the Hemmer Acquisition.

See Note 12, Financial Instruments , for additional information.

We utilized fair values at the Hemmer Acquisition Date to allocate the total consideration exchanged to the net tangible and intangible assets acquired and liabilities assumed.

The purchase price allocation for the Hemmer Acquisition was final as of the first quarter of 2023.

The final purchase price allocation to assets acquired and liabilities assumed in the Hemmer Acquisition was (in millions):

Final Allocation

Trade receivables 13

Inventories 17

Other current assets 2

Property, plant and equipment, net 14

Identifiable intangible assets 122

Other non-current assets 17

Short-term debt ( 9 )

Trade payables ( 11 )

Other current liabilities ( 31 )

Long-term debt ( 11 )

Other non-current liabilities ( 44 )

Net assets acquired 80

Noncontrolling interest ( 16 )

Goodwill on acquisition 215

Total consideration $ 279

The Hemmer Acquisition preliminarily resulted in $ 219 million of non-tax deductible goodwill relating principally to Hemmer’s long-term experience and large presence operating in emerging markets.

This goodwill was assigned to the Latin America (“LATAM”) reporting unit within Emerging Markets.

In 2022, certain insignificant measurement period adjustments were made to the initial allocation, and the final amount of goodwill was adjusted to $ 215 million.

In the fourth quarter of 2022, a portion of the goodwill became tax deductible following the merger of Hemmer into our existing legal entity structure.

As part of our 2024 annual impairment test, we fully impaired the goodwill related to our LATAM reporting unit, and there is no goodwill carrying value remaining as of December 28, 2024.

See Note 8, Goodwill and Intangible Assets , for additional information.

The final purchase price allocation to identifiable intangible assets acquired in the Hemmer Acquisition was:

(in millions of dollars) Weighted Average Life

Definite-lived trademarks $ 101 13

Customer-related assets 21 15

We valued trademarks using the relief from royalty method and customer-related assets using the distributor method.

Some of the more significant assumptions inherent in developing the valuations included the estimated annual net cash flows for each definite-lived intangible asset (including net sales, cost of products sold, selling and marketing costs, and working capital/contributory asset charges), the discount rate that appropriately reflects the risk inherent in each future cash flow stream, the assessment of each asset’s life cycle, and competitive trends, as well as other factors.

We determined the assumptions used in the financial forecasts using historical data, supplemented by current and anticipated market conditions, estimated product category growth rates, management’s plans, and market comparables.

We used carrying values as of the Hemmer Acquisition Date to value certain current and non-current assets and liabilities, as we determined that they represented the fair value of those items at such date.

Just Spices Acquisition:

On January 18, 2022 (the “Just Spices Acquisition Date”), we acquired 85 % of the shares of Just Spices GmbH (“Just Spices”), a German-based company focused on direct-to-consumer sales of premium spice blends, from certain third-party shareholders (the “Just Spices Acquisition”).

The Just Spices Acquisition was accounted for under the acquisition method of accounting for business combinations.

Total cash consideration related to the Just Spices Acquisition was approximately 214 million euros (approximately $ 243 million at the Just Spices Acquisition Date).

Under the terms of certain transaction agreements, Just Spices’ other equity holders each have a put option to require us to purchase the remaining equity interests beginning three years after the Just Spices Acquisition Date.

If the put option is not exercised, we have a call option to acquire the remaining equity interests of Just Spices.

Considering the contractual terms related to the noncontrolling interest, it is classified as redeemable noncontrolling interest on our consolidated balance sheet.

Subsequent to the Just Spices Acquisition, the redeemable noncontrolling interest is measured at the greater of the amount that would be paid if settlement occurred as of the balance sheet date based on the contractually defined redemption value and its carrying amount adjusted for the net income/(loss) attributable to the noncontrolling interest.

In the third quarter of 2023, we completed the redemption of an additional 5 % of the outstanding shares.

In the second quarter of 2024, we completed the redemption of the remaining outstanding shares and wholly own Just Spices as of December 28, 2024.

We utilized fair values at the Just Spices Acquisition Date to allocate the total consideration exchanged to the net tangible and intangible assets acquired and liabilities assumed.

The purchase price allocation for the Just Spices Acquisition was final as of the fourth quarter of 2022.

The final purchase price allocation to assets acquired and liabilities assumed in the Just Spices Acquisition was (in millions):

Final Allocation

Trade receivables 4

Inventories 7

Other current assets 9

Property, plant and equipment, net 1

Identifiable intangible assets 172

Other non-current assets 7

Trade payables ( 10 )

Other current liabilities ( 12 )

Other non-current liabilities ( 54 )

Net assets acquired 126

Redeemable noncontrolling interest ( 39 )

Goodwill on acquisition 156

Total consideration $ 243

The Just Spices Acquisition preliminarily resulted in $ 167 million of non-tax deductible goodwill relating principally to Just Spices’ social media presence.

This goodwill was assigned to the Continental Europe reporting unit within our International Developed Markets segment.

In 2022, certain insignificant measurement period adjustments were made to the initial allocation, and the final amount of goodwill was adjusted to $ 156 million.

See Note 8, Goodwill and Intangible Assets , for additional information.

The final purchase price allocation to identifiable intangible assets acquired in the Just Spices Acquisition was:

(in millions of dollars) Weighted Average Life

Definite-lived trademarks $ 72 10

Customer-related assets 100 15

We valued trademarks using the relief from royalty method and customer-related assets using the distributor method.

We used carrying values as of the Just Spices Acquisition Date to value certain current and non-current assets and liabilities, as we determined that they represented the fair value of those items at such date.

Related to our acquisitions, we incurred insignificant deal costs in 2024, 2023 and 2022.

We recognized these deal costs in SG&A.

Italy Infant Transaction:

On July 9, 2025, we entered into a definitive agreement with a third party, NewPrinces S.p.A., to sell our infant and specialty food business in Italy, within our International Developed Markets segment (the “Italy Infant Transaction”).

The net assets to be transferred in the Italy Infant Transaction include, among other things, our intellectual property rights to the Plasmon and Nipiol brands and one manufacturing facility in Italy (collectively, the “Italy Infant Disposal Group”).

In the third quarter of 2025, we determined that the Italy Infant Disposal Group met the held for sale criteria.

Accordingly, we have presented the assets and liabilities of the Italy Infant Disposal Group as held for sale on the consolidated balance sheet at December 27, 2025.

As of July 9, 2025, the date the Italy Infant Disposal Group was determined to be held for sale, we tested the individual assets included within the Italy Infant Disposal Group for impairment.

We determined that the net assets of the Italy Infant Disposal Group had an aggregate carrying amount above their estimated fair value less cost to sell, and that the goodwill within the Italy Infant Disposal Group was fully impaired.

Accordingly, we recorded a non-cash goodwill impairment loss of $ 40 million, which was recognized in SG&A, for the year ended December 27, 2025.

Further, we recorded an estimated pre-tax loss on sale of business of $ 47 million for the year ended December 27, 2025, which was recognized in other expense/(income) on our consolidated statement of income.

On December 31, 2025, in the first quarter of our fiscal year 2026, we closed the Italy Infant Transaction for total cash consideration of approximately $ 146 million.

Russia Infant Transaction:

2 unchanged sentences

Papua New Guinea Transaction:

On February 5, 2024, we closed and finalized the sale of 100% of the equity interests in our Papua New Guinea subsidiary, Hugo Canning Company Limited, to a third party for total cash consideration of approximately $ 22 million, which is to be paid incrementally over two years following the transaction closing date (the “Papua New Guinea Transaction”).

As a result of the Papua New Guinea Transaction, we recognized a pre-tax loss on sale of business of approximately $ 80 million in other expense/(income) on our condensed consolidated statement of income in the first quarter of 2024, of which approximately $ 41 million relates to the release of accumulated foreign currency losses.

Powdered Cheese Transaction:

In August 2022, we entered into a definitive agreement with a third party, Kerry Group, to sell our business-to-business powdered cheese business (the “Powdered Cheese Transaction”).

The net assets transferred in the Powdered Cheese Transaction include, among other things, the Albany, Minnesota manufacturing facility (collectively, the “Powdered Cheese Disposal Group”).

The Powdered Cheese Transaction closed in the fourth quarter of 2022 for total cash consideration of approximately $ 108 million.

As a result of the Powered Cheese Transaction closing, we recognized a pre-tax gain on sale of business of approximately $ 26 million in other expense/(income) on our consolidated statement of income.

Related to our divestitures, we incurred insignificant deal costs in 2024, 2023, and 2022.

We incurred insignificant deal costs in 2025, 2024, and 2023.

We recognized these deal costs in SG&A.

7 unchanged sentences

Asset-related costs primarily relate to accelerated depreciation and asset impairment charges.

Other restructuring costs primarily relate to start-up costs of new facilities, professional fees, asset relocation costs, costs to exit facilities, and costs associated with restructuring benefit plans.

Other restructuring costs primarily relate to professional fees, asset relocation costs, costs to exit facilities, and costs associated with restructuring benefit plans.

Employee severance and other termination benefit packages are primarily determined based on established benefit arrangements, local statutory requirements, and historical benefit practices.

7 unchanged sentences

We eliminated approximately 600 positions in 2025.

As of December 28, 2024, we expect to eliminate approximately 740 additional positions in 2025 across all zones.

In 2024, restructuring activities resulted in net expenses of $ 20 million and included a net expense of $ 21 million of severance and employee benefit costs, a net benefit of $ 2 million of other exit costs, and a net expense of $ 1 million of asset-related cost.

As of December 27, 2025, we expect to eliminate approximately 60 additional positions in 2026, primarily outside of the United States and Canada.

In 2025, restructuring activities resulted in net expenses of $ 21 million and included a net expense of $ 14 million of other restructuring costs, a net expense of $ 9 million of severance and employee benefit costs, a net benefit of $ 3 million of other exit costs, and a net expense of $ 1 million of asset-related costs.

Restructuring activities resulted in expenses of $ 20 million in 2024 and $ 225 million in 2023.

3 unchanged sentences

Balance at December 28, 2024 $ 29 $ 11 $ 40

$ 23 $ 14 $ 37

Charges/(credits) 9 ( 3 ) 6

Cash payments ( 29 ) ( 6 ) ( 35 )

Non-cash utilization 1 — 1

Balance at December 27, 2025

$ 29 $ 11 $ 40

We expect the majority of the liability for severance and employee benefit costs as of December 28, 2024 to be paid by the second quarter of 2025.

The liability for other exit costs primarily relates to lease obligations.

The cash impact of these obligations will continue for the duration of the lease terms, which expire between 2026 and 2031.

We expect the liability for severance and employee benefit costs as of December 27, 2025 to be paid by the third quarter of 2026.

The liability for other exit costs relates to lease obligations.

The cash impact of these obligations will continue for the duration of the lease term, which expires in 2031.

Total Expenses/(Income):

26 unchanged sentences

Inventories $ 3,167 $ 3,376

At December 27, 2025, inventories excluded amounts classified as held for sale.

See Note 5, Acquisitions and Divestitures , for additional information.

Property, Plant and Equipment

11 unchanged sentences

Goodwill and Intangible Assets

As described in Note 1, Basis of Presentation , in the first quarter of 2024, we divided our International segment into three operating segments — EPDM, WEEM, and AEM.

While this reorganization resulted in a change to our operating segments, it did not impact the existing composition of our reporting units that formerly comprised the goodwill balance of our International segment — Northern Europe, Continental Europe, Latin America (“LATAM”), and Asia — and, therefore, was not indicative of an impairment triggering event.

We have reflected the impact of this segment change in all historical periods presented.

On March 31, 2024, which was the first day of our second quarter of 2024, certain organizational changes occurred that impacted our reporting unit composition within our North America segment (the “Q2 North America reorganization”).

Two of our North America reporting units — Taste, Meals, and Away From Home (“TMA”), and Fresh, Beverages, and Desserts (“FBD”) — were reorganized into the four reporting units:

Taste Elevation, Ready Meals and Snacking (“TMS”), Hydration & Desserts (“HD”), Meat & Cheese (“MC”), and Away from Home & Kraft Heinz Ingredients (“AFH”).

The Canada and North America Coffee (“CNAC”) and Other North America reporting units were not impacted by this reorganization.

Changes in the carrying amount of goodwill, by segment, were (in millions):

1 unchanged sentence

Balance at December 30, 2023

$ 27,248 $ 2,687 $ 524 $ 30,459

Impairment losses ( 959 ) ( 495 ) ( 184 ) ( 1,638 )

1 unchanged sentence

Balance at December 28, 2024

$ 26,232 $ 2,134 $ 307 $ 28,673

Impairment losses ( 5,875 ) ( 859 ) — ( 6,734 )

2 unchanged sentences

$ 20,392 $ 1,470 $ 317 $ 22,179

In 2025, we recorded non-cash goodwill impairment losses of $ 5.9 billion within our North America segment, $ 859 million within our International Developed Markets segment, and no impairment losses were recorded within Emerging Markets.

These impairments were primarily related to an interim impairment test performed in the second quarter of 2025 resulting from the triggering event discussed below, and $ 40 million of impairment losses within our International Developed Markets segment related to goodwill attributable to the Italy Infant Disposal Group, which was determined to be fully impaired.

The remaining impacts to goodwill in 2025 were related to translation adjustments.

Acquisitions and Divestitures , for additional information related to the Italy Infant Transaction and its financial statement impact.

In 2024, we recorded non-cash goodwill impairment losses of $ 959 million within our North America segment, $ 495 million within our International Developed Markets segment, and $ 184 million within Emerging Markets as a result of our 2024 goodwill impairment testing discussed below.

The remaining impact to goodwill in 2024 primarily related to translation adjustments.

In 2023, we recorded non-cash goodwill impairment losses of $ 452 million within our North America segment and $ 58 million within our International Developed Markets segment as a result of our 2023 goodwill impairment testing discussed below.

The remaining impact to goodwill in 2023 primarily related to translation adjustments.

2025 Goodwill Impairment Testing

Q1 2025 Goodwill Impairment Testing

In the first quarter of 2025, certain organizational changes occurred that impacted our reporting unit composition within our International Developed Markets segment (the “Q1 Europe reorganization”).

Two of our International Developed Market reporting units — Northern Europe (“NE”) and Continental Europe (“CE”) — were combined into one reporting unit, Western Europe (“WE”).

None of our other reporting units were impacted by this reorganization.

As a result of this reorganization, the existing assets and liabilities of the impacted reporting units were combined and we performed an interim impairment test (or transition test) on the affected reporting units on both a pre- and post-reorganization basis.

We performed our pre-reorganization and post-reorganization tests as of December 29, 2024, which was our first day of 2025.

As part of our pre-reorganization impairment test of the NE and CE reporting units, and post-reorganization test of the WE reporting unit, we utilized the discounted cash flow method under the income approach to estimate the fair values as of December 29, 2024.

As a result of these tests, we concluded that the fair value of these reporting units exceeded their carrying amounts and no impairment was recorded.

Q2 2025 Goodwill Impairment Testing

During the second quarter of 2025, we concluded that the sustained decline in our share price and market capitalization was a triggering event requiring an interim goodwill impairment assessment for all reporting units.

We performed an interim impairment test (“Q2 Impairment Test”) as of the last day of our second quarter, June 28, 2025, and utilized the discounted cash flow method under the income approach to estimate the fair value of our reporting units.

As a result of our Q2 Impairment Test, we recognized non-cash goodwill impairment losses of $ 6.7 billion in SG&A in the second quarter of 2025, of which $ 3.1 billion related to our Taste Elevation, Ready Meals and Snacking (“TMS”) reporting unit, $ 1.6 billion related to our Meat & Cheese (“MC”) reporting unit, $ 805 million related to our Canada and North America Coffee (“CNAC”) reporting unit, and $ 400 million related to our Away from Home & Kraft Heinz Ingredients (“AFH”) reporting unit within our North America segment, as well as $ 819 million related to our WE reporting unit within our International Developed Markets segment.

The impairments of our TMS, AFH, WE, MC, and CNAC reporting units were primarily due to the market’s perceived risk of our ability to achieve our future cash flow projections, due, in part, to uncertainty in the macroeconomic environment in which we operate.

The impairment of our MC reporting unit was also partially driven by a reduction of future long-term growth assumptions.

Q3 2025 Goodwill Impairment Testing

As of the first day of the third quarter of 2025, certain organizational changes occurred that resulted in a change to the reporting unit composition within our North America segment.

Our six North America reporting units — TMS, Hydration & Desserts (“HD”), MC, AFH, CNAC, and Other North America — were reorganized into five reporting units:

Hydration, Desserts, & Meals (“HDM”);

Meat, Cheese, Coffee, & Snacks (“MCCS”);

and Other North America.

As a result of this reorganization, we reassigned assets and liabilities to the applicable reporting units and allocated goodwill using the relative fair value approach.

We performed an interim impairment test on the affected reporting units on both a pre- and post-reorganization basis.

We performed our pre-reorganization impairment test as of June 29, 2025, which was our first day of the third quarter of 2025.

There were five reporting units affected by the reassignment of assets and liabilities that maintained a goodwill balance as of our pre-reorganization impairment test date.

These reporting units were TMS, HD, MC, AFH, and CNAC.

Our Other North America reporting unit did not have a goodwill balance as of our pre-reorganization impairment test date.

As part of our pre-reorganization impairment test, we utilized the discounted cash flow method under the income approach to estimate the fair values as of June 29, 2025 for the five reporting units noted above.

As a result of our pre-reorganization impairment test, we concluded that the fair value of these reporting units exceeded their carrying amounts and no impairment was recorded.

We performed our post-reorganization impairment test in conjunction with our 2025 annual impairment test and tested the new North America reporting units (Elevation, HDM, MCCS, Canada, and Other North America) along with the reporting units in our International Developed Markets segment and Emerging Markets.

We tested our reporting units for impairment as of the first day of our third quarter, which was June 29, 2025 for our 2025 annual impairment test.

We utilized the discounted cash flow method under the income approach to estimate the fair value of our reporting units.

As a result of our 2025 annual impairment test, we determined that the fair value of each of the reporting units tested was in excess of its carrying amount and no impairments were recorded.

As of December 27, 2025, we maintain 10 reporting units globally, six of which comprise our goodwill balance.

These six reporting units had an aggregate goodwill carrying amount of $ 22.2 billion at December 27, 2025.

Accumulated impairment losses to goodwill were $ 20.2 billion as of December 27, 2025 and $ 13.5 billion at December 28, 2024.

2024 Goodwill Impairment Testing

Two of our North America reporting units — Taste, Meals, and Away From Home (“TMA”), and Fresh, Beverages, and Desserts (“FBD”) — were reorganized into the four reporting units:

TMS, HD, MC, and AFH.

The CNAC and Other North America reporting units were not impacted by this reorganization.

As a result of the Q2 North America reorganization, we reassigned assets and liabilities to the applicable reporting units and allocated goodwill using the relative fair value approach.

We performed an interim impairment test (or “2024 transition test”) on the affected reporting units on both a pre- and post-reorganization basis.

We performed an interim impairment test on the affected reporting units on both a pre- and post-reorganization basis.

As part of our Q2 North America pre-reorganization impairment test of the TMA and FBD reporting units, we utilized the discounted cash flow method under the income approach to estimate the fair values as of March 31, 2024, for these two reporting units and concluded that the fair value of these reporting units exceeded their carrying values and no impairment was recorded.

4 unchanged sentences

The impairment of our MC reporting unit was driven by the disaggregation of the former FBD reporting unit, which previously held all the net assets for the HD and MC reporting units as well as the Snacking category of TMS.

The other three reporting units for which no impairment charge was required were TMS, which had a goodwill carrying amount of approximately $ 15.9 billion;

HD, which had a goodwill carrying amount of approximately $ 4.3 billion;

and AFH, which had a goodwill carrying amount of approximately $ 2.8 billion.

We performed our 2024 annual impairment test as of June 30, 2024, which was the first day of our third quarter of 2024.

We utilized the discounted cash flow method under the income approach to estimate the fair value of our reporting units.

As a result of our 2024 annual impairment test, we recognized non-cash goodwill impairment losses in SG&A of approximately $ 495 million related to our Continental Europe reporting unit within our International Developed Markets segment, $ 184 million related to our LATAM reporting unit within Emerging Markets, and $ 105 million related to our AFH reporting unit within our North America segment.

As a result of our 2024 annual impairment test, we recognized non-cash goodwill impairment losses in SG&A of approximately $ 495 million related to our Continental Europe reporting unit within our International Developed Markets segment, $ 184 million related to our Latin America (“LATAM”) reporting unit within Emerging Markets, and $ 105 million related to our AFH reporting unit within our North America segment.

The impairment of our Continental Europe reporting unit was primarily driven by a reduction of future year profitability assumptions from prior estimates in non-core categories and the Just Spices business, as well as higher intercompany royalty expenses resulting from a change in our product mix.

The impairment of our LATAM reporting unit was primarily driven by a reduction of future year profitability assumptions from prior estimates and negative macroeconomic factors, including weakening of the foreign currency exchange rate of the Brazilian real relative to the U.S.

After these impairments, the goodwill carrying amount was approximately $ 2.7 billion in our AFH reporting unit, approximately $ 485 million in our Continental Europe reporting unit, and there is no goodwill carrying value remaining in our LATAM reporting unit.

As of our 2024 annual impairment test, our reporting units with 20 % or less fair value over carrying amount had an aggregate goodwill carrying amount of $ 24.1 billion and included TMS, AFH, MC, Northern Europe, CNAC, and Continental Europe.

Our HD and Asia reporting units had 20 - 50 % fair value over carrying amount with an aggregate goodwill carrying amount of $ 4.6 billion as of our 2024 annual impairment test date.

As of December 28, 2024, we maintain 12 reporting units, eight of which comprise our goodwill balance.

These eight reporting units had an aggregate goodwill carrying amount of $ 28.7 billion at December 28, 2024.

Accumulated impairment losses to goodwill were $ 13.5 billion as of December 28, 2024 and $ 11.8 billion at December 30, 2023.

2023 Goodwill Impairment Testing

2 unchanged sentences

We utilized the discounted cash flow method under the income approach to estimate the fair value of our reporting units.

As a result of our 2023 annual impairment test, we recognized a non-cash goodwill impairment loss of approximately $ 510 million in SG&A, which included a $ 452 million impairment loss in our Canada and North America Coffee (“CNAC”) reporting unit within our North America segment and a $ 58 million impairment loss in our Continental Europe reporting unit within our International Developed Markets segment.

As a result of our 2023 annual impairment test, we recognized a non-cash goodwill impairment loss of approximately $ 510 million in SG&A, which included a $ 452 million impairment loss in our CNAC reporting unit within our North America segment and a $ 58 million impairment loss in our Continental Europe reporting unit within our International Developed Markets segment.

These impairments were primarily driven by an increase in the discount rate, which was impacted by higher interest rates, a decline in market capitalization, and other market inputs.

2022 Goodwill Impairment Testing

We historically tested our reporting units and brands for impairment annually as of the first day of our second quarter, or more frequently if events or circumstances indicate it is more likely than not that the fair value of a reporting unit or brand is less than its carrying amount.

As discussed in further detail below, we performed an annual test as of March 27, 2022, the first day of our second quarter (the “Q2 2022 Annual Impairment Test”).

Beginning in the third quarter of 2022 and for subsequent annual periods, we voluntarily changed the annual impairment assessment date to the first day of our third quarter and performed an additional annual impairment test as of June 26, 2022 (the “Q3 2022 Annual Impairment Test”).

In the second quarter of 2022, we changed our reporting and reportable segments and combined our United States and Canada zones to form the North America zone.

As a result of these changes, the composition of certain reporting units changed and we performed an interim impairment test (or transition test) on the affected reporting units on both a pre- and post-reorganization basis.

We performed our pre-reorganization impairment test as of March 27, 2022, which was our first day of the second quarter of 2022.

There were six reporting units affected by the reassignment of assets and liabilities that maintained a goodwill balance as of our pre-reorganization impairment test date.

These reporting units were Enhancers, Specialty, and Away From Home (“ESA”);

Kids, Snacks, and Beverages (“KSB”);

Meal Foundations and Coffee (“MFC”);

Canada Retail;

and Canada Foodservice.

One other reporting unit did not have a goodwill balance as of our pre-reorganization impairment test date.

As part of our pre-reorganization impairment test, we utilized the discounted cash flow method under the income approach to estimate the fair values as of March 27, 2022 for the six reporting units noted above.

As a result of our pre-reorganization impairment test, we recognized a non-cash impairment loss of approximately $ 235 million in SG&A in our North America segment in the second quarter of 2022.

This included a $ 221 million impairment loss related to our Canada Retail reporting unit, and a $ 14 million impairment loss related to our Puerto Rico reporting unit.

The impairment of our Canada Retail reporting unit was primarily driven by an increase in the discount rate, which was impacted by higher interest rates and other market inputs, as well as a revised downward outlook for operating margin.

The impairment of our Puerto Rico reporting unit was primarily driven by a revised downward outlook for operating margin.

The remaining reporting units tested as part of our pre-reorganization impairment test each had excess fair value over carrying amount as of March 27, 2022.

We performed our post-reorganization impairment test in conjunction with our Q2 2022 Annual Impairment Test and tested the new North America reporting units (TMA, FBD, CNAC, and Other North America) along with the reporting units in our former International segment.

The new North America reporting units’ goodwill carrying amounts for the post-reorganization and Q2 2022 Annual Impairment Test reflected the pre-reorganization test results, including impairments recorded.

We tested our reporting units for impairment as of the first day of our second quarter, which was March 27, 2022 for our Q2 2022 Annual Impairment Test.

In performing this test, we incorporated information that was known through the date of filing our Quarterly Report on Form 10-Q for the period ended June 25, 2022.

We utilized the discounted cash flow method under the income approach to estimate the fair value of our reporting units.

As a result of our Q2 2022 Annual Impairment Test, we determined that the fair value of each of the reporting units tested was in excess of its carrying amount.

We performed our Q3 2022 Annual Impairment Test as of June 26, 2022, which was the first day of our third quarter of 2022.

In performing this test, we incorporated information that was known through the date of filing of our Quarterly Report on Form 10-Q for the period ended September 24, 2022.

We utilized the discounted cash flow method under the income approach to estimate the fair value of our reporting units.

As a result of our Q3 2022 Annual Impairment Test, we recognized a non-cash impairment loss of approximately $ 220 million in SG&A in our North America segment related to our CNAC reporting unit.

The impairment of our CNAC reporting unit was primarily driven by reduced revenue growth assumptions and negative macroeconomic factors, including increased interest rates and foreign currency exchange rates for the Canadian dollar relative to the U.S.

Additional Goodwill Considerations

Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors.

Estimating the fair value of individual reporting units requires us to make assumptions and estimates regarding our future plans, as well as industry, economic, and regulatory conditions.

These assumptions and estimates include estimated future annual net cash flows (including net sales, cost of products sold, SG&A, depreciation and amortization, working capital, and capital expenditures), income tax rates, discount rates, long-term growth rates, royalty rates, and other market factors.

If current expectations of future growth rates and margins are not met, if market factors outside of our control, such as discount rates, market capitalization, income tax rates, foreign currency exchange rates, or inflation, change, or if management’s expectations or plans otherwise change, including updates to our long-term operating plans, then one or more of our reporting units might become impaired in the future.

Additionally, any decisions to divest certain non-strategic assets has led, and could in the future lead, to goodwill impairments.

Our reporting units that were impaired in 2025, 2024, and 2023 were written down to their respective fair values resulting in zero excess fair value over carrying amount as of the applicable impairment test dates.

Accordingly, our reporting units that had 20 % or less excess fair value over carrying amount as of our 2024 annual impairment test have a heightened risk of future impairments if any assumptions, estimates, or market factors change in the future.

Although the remaining reporting units had more than 20 % excess fair value over carrying amount as of our 2024 annual impairment test, this amount is also susceptible to impairments if any assumptions, estimates, or market factors significantly change in the future.

During the fourth quarter of 2024, certain organizational changes were announced that are expected to impact our future internal reporting and reporting units.

We expect to combine the Northern Europe (“NE”) and Continental Europe (“CE”) reporting units into one reporting unit, Western Europe, in an effort to drive efficiencies in our organizational structure and reporting processes.

We anticipate this change will become effective in the first quarter of 2025 and will require us to reallocate the existing goodwill from the former reporting units, NE and CE, into the new reporting unit, Western Europe.

Following the 2025 annual impairment test, our Elevation, HDM, Western Europe, MCCS, and Canada reporting units had less than 5 % fair value over carrying amount with an aggregate goodwill carrying amount of $ 21.9 billion.

Our Asia reporting unit had less than 20 % fair value over carrying amount with an aggregate goodwill carrying amount of $ 314 million as of the 2025 annual impairment test date.

Accordingly, these reporting units have a heightened risk of future impairments if any assumptions, estimates, or market factors change in the future.

Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors.

Estimating the fair value of individual reporting units requires us to make assumptions and estimates regarding our future plans, as well as industry, economic, and regulatory conditions, and to consider the market multiples of certain peer and guideline companies.

These assumptions and estimates include estimated future annual cash flows (including net sales, cost of products sold, SG&A, depreciation and amortization, working capital, and capital expenditures), income tax rates, discount rates, long-term growth rates, royalty rates, and other market factors.

As part of our 2025 annual impairment test as of June 29, 2025, we used discount rates ranging from 7.3 % to 14.8 % and long-term growth rates ranging from 0.0 % to 4.0 %.

If current expectations of future growth rates and margins are not met, if market factors outside of our control change;

such as discount rates, market capitalization, income tax rates, foreign currency exchange rates, or inflation, or if management’s expectations or plans otherwise change, including updates to our long-term operating plans, then one or more of our reporting units might become impaired in the future.

Additionally, any decisions to divest certain non-strategic assets could lead to future goodwill impairments.

Indefinite-lived intangible assets:

2 unchanged sentences

Impairment losses ( 1,903 )

Transfers to definite-lived intangible assets ( 73 )

Translation adjustments and other ( 143 )

5 unchanged sentences

Our indefinite-lived intangible asset balance primarily consists of a number of individual brands, which had an aggregate carrying amount of $ 34.2 billion at December 27, 2025.

Q2 2025 Indefinite-Lived Intangible Asset Impairment Testing

During the second quarter of 2025, we concluded that the sustained decline in our share price and market capitalization was a triggering event requiring an interim indefinite-lived intangible asset impairment assessment for our brands.

As part of the Q2 Impairment Test, we utilized the multi-period excess earnings and relief from royalty methods under the income approach to estimate the fair value of our indefinite-lived intangible assets.

As a result of our Q2 Impairment Test, we recognized non-cash intangible asset impairment losses of $ 2.6 billion in SG&A in the second quarter of 2025, of which $ 1.9 billion related to Kraft , $ 382 million related to Velveeta , $ 175 million related to Lunchables , $ 100 million related to Maxwell House and $ 42 million related to two other brands in our North America segment, consistent with ownership of the trademarks.

The impairments of these brands were primarily due to the market’s perceived risk of our ability to achieve our future year revenue growth and margin growth assumptions, due, in part, to uncertainty in the macroeconomic environment in which we operate.

After these impairments, the aggregate carrying amount of these brands was $ 13.0 billion.

Q3 2025 Indefinite-Lived Intangible Asset Impairment Testing

We performed our 2025 annual impairment test as of June 29, 2025, which was the first day of our third quarter of 2025.

As part of the annual impairment test, we utilized the multi-period excess earnings and relief from royalty methods under the income approach to estimate the fair value of our indefinite-lived intangible assets.

As a result of our 2025 annual impairment test, we concluded that the fair value of these brands exceeded their carrying amounts and no impairment was recorded.

2024 Indefinite-Lived Intangible Asset Impairment Testing

As a result of our 2024 annual impairment test as of June 30, 2024, we recognized non-cash intangible asset impairment losses of $ 593 million in SG&A in the third quarter of 2024 related to our Lunchables, Claussen, and Wattie’s brands.

2 unchanged sentences

The impairment of the Claussen brand was primarily due to a reduction of future year margin assumptions from prior estimates.

After these impairments, the aggregate carrying amount of these brands was $ 1.2 billion.

During the fourth quarter of 2024, we recognized a non-cash intangible asset impairment loss of $ 1.3 billion in SG&A related to our Oscar Mayer brand.

The impairment was due to additional perceived risk in achieving our long-term cash flow forecasts for the meats business.

Brands with 20 % or less fair value over carrying amount had an aggregate carrying amount after impairment of $ 16.8 billion as of the latest test for each brand, brands with 20 - 50 % fair value over carrying amount had an aggregate carrying amount of $ 2.8 billion as of the latest test for each brand, and brands that had over 50 % fair value over carrying amount had an aggregate carrying amount of $ 16.9 billion as of the latest test for each brand.

2023 Indefinite-Lived Intangible Asset Impairment Testing

4 unchanged sentences

After the fair value assessment of these brands as part of our 2023 annual impairment test, we transferred $ 73 million from indefinite-lived intangible assets to definite-lived trademarks as of July 2, 2023 and recognized six months of amortization expense as of December 30, 2023.

2022 Indefinite-Lived Intangible Asset Impairment Testing

We performed our Q2 2022 Annual Impairment Test as of March 27, 2022, which was the first day of our second quarter in 2022.

As a result of our Q2 2022 Annual Impairment Test, we recognized a non-cash impairment loss of $ 395 million in SG&A in our North America segment in the second quarter of 2022 related to four brands, Maxwell House , Miracle Whip , Jet Puffed , and Classico.

We utilized the relief from royalty method under the income approach to estimate the fair values of the Maxwell House, Jet Puffed , and Classico brands and the excess earnings method under the income approach to estimate the fair value of the Miracle Whip brand.

The impairments of the Maxwell House, Jet Puffed , and Classico brands were primarily due to downward revisions in expected future operating margins as well as an increase in the discount rate, which was impacted by higher interest rates and other market inputs.

The impairment of the Miracle Whip brand was primarily due to an increase in the discount rate as well as downward revisions in expected future operating margins due to changes in expectations for commodity input costs, including soybean oil.

We performed our Q3 2022 Annual Impairment Test as of June 26, 2022, which was our first day of the third quarter of 2022.

As a result of our Q3 2022 Annual Impairment Test we recognized a non-cash impairment loss of $ 67 million in SG&A in the third quarter of 2022 related to two brands, Jet Puffed and Plasmon .

We utilized the relief from royalty method under the income approach to estimate the fair values and recorded non-cash impairment losses of $ 50 million in our North America segment and $ 17 million in our International Developed Markets segment, consistent with ownership of the trademarks.

The impairment of these brands was primarily due to reduced revenue growth assumptions.

Additional Indefinite-Lived Intangible Asset Considerations

Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors.

Estimating the fair value of individual brands requires us to make assumptions and estimates regarding our future plans, as well as industry, economic, and regulatory conditions.

These assumptions and estimates include estimated future annual net cash flows, income tax considerations, discount rates, long-term growth rates, royalty rates, contributory asset charges, and other market factors.

Additionally, any decisions to divest certain non-strategic assets has led, and could in the future lead, to intangible asset impairments.

Our brands that were impaired in 2025, 2024, and 2023 were written down to their respective fair values resulting in zero excess fair value over carrying amount as of the applicable impairment test dates.

Accordingly, these and other individual brands that had 20 % or less excess fair value over carrying amount as of our 2024 annual impairment test have a heightened risk of future impairments if any assumptions, estimates, or market factors change in the future.

Although the remaining brands had more than 20 % excess fair value over carrying amount as of our 2024 annual impairment test, these amounts are also susceptible to impairments if any assumptions, estimates, or market factors significantly change in the future.

As of the 2025 annual impairment test, brands with 20 % or less fair value over carrying amount had an aggregate carrying amount after impairment of $ 15.0 billion, brands with 20 %- 50 % fair value over carrying amount had an aggregate carrying amount of $ 17.0 billion, and brands that had over 50 % fair value over carrying amount had an aggregate carrying amount of $ 2.2 billion.

Our brands that had 20 % or less excess fair value over carrying amount as of our 2025 annual impairment test have a heightened risk of future impairments if any assumptions, estimates, or market factors change in the future.

Although our remaining brands had more than 20 % excess fair value over carrying amount as of our 2025 annual impairment test, these amounts are also susceptible to impairments if any assumptions, estimates, or market factors significantly change in the future.

Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors.

Estimating the fair value of individual brands requires us to make assumptions and estimates regarding our future plans, as well as industry, economic, and regulatory conditions, and to consider the market multiples of certain peer and guideline companies.

These assumptions and estimates include estimated future annual cash flows, income tax considerations, discount rates, long-term growth rates, royalty rates, contributory asset charges, and other market factors.

As part of our 2025 annual impairment test as of June 29, 2025, we used discount rates ranging from 8.5 % to 12.3 %, long-term growth rates ranging from 0.0 % to 4.0 %, and royalty rates ranging from 5.0 % to 20.0 %.

If current expectations of future growth rates, royalty rates, and margins are not met, if market factors outside of our control change;

Additionally, any decisions to divest certain non-strategic assets could lead to future intangible asset impairments.

Definite-lived intangible assets:

2 unchanged sentences

Gross Accumulated

Amortization Net Gross Accumulated

Amortization Net (a)

Gross Accumulated

Amortization Net

3 unchanged sentences

$ 6,084 $ ( 2,720 ) $ 3,364 $ 6,070 $ ( 2,427 ) $ 3,643

(a) At December 27, 2025, definite-lived intangible assets excluded amounts classified as held for sale due to the Italy Infant Transaction.

See Note 5, Acquisitions and Divestitures , for additional information on amounts held for sale.

2025 Changes in Definite-Lived Assets

Amortization expense for definite-lived intangible assets was $ 246 million in 2025, $ 252 million in 2024, and $ 251 million in 2023.

Aside from amortization expense, the change in definite-lived intangible assets from December 28, 2024 to December 27, 2025 primarily related to amounts reclassified to assets held for sale, the impact of foreign currency, and non-cash intangible asset impairment losses of $ 11 million recognized in the second quarter of 2025 related to two definite-lived intangible assets within our International Developed Markets segment.

We estimate that amortization expense related to definite-lived intangible assets will be approximately $ 240 million in 2026 and for the following four years from 2027 through 2030.

2024 Changes in Definite-Lived Assets

In the second quarter of 2024, we entered into an amended license agreement to grant us the exclusive, irrevocable, royalty-free, and perpetual right to use certain TGI Friday trademarks to manufacture, distribute, market, and sell certain TGI Friday licensed products (the “TGI Friday License”).

1 unchanged sentence

We recognized this TGI Friday License as a definite-lived intangible asset to be amortized over its 27-year useful life.

In the third quarter of 2024, we recognized non-cash definite-lived intangible asset impairment losses of $ 128 million in SG&A related to the Just Spices trademark and customer-related assets.

In the third quarter of 2024, we recognized non-cash definite-lived intangible asset impairment losses of $ 128 million in S G &A related to the Just Spices trademark and customer-related assets.

We utilized the relief from royalty method under the income approach for the trademark and the distributor method under the income approach for the customer-related assets to estimate the fair values and recorded non-cash impairment losses in our Continental Europe reporting unit within our International Developed Markets segment, consistent with ownership of the trademarks and customer-related assets.

The impairments of the Just Spices trademark and the customer-related assets were primarily due to a reduction of future year revenue growth and margin assumptions from prior expectations.

Amortization expense for definite-lived intangible assets was $ 252 million in 2024, $ 251 million in 2023, and $ 261 million in 2022.

Aside from amortization expense, the change in definite-lived intangible assets from December 30, 2023 to December 28, 2024 primarily relates to the acquisition of the TGI Friday License, the $ 128 million of non-cash impairment losses related to the Just Spices trademark and customer-related assets within our International Developed Markets segment, and the impacts of foreign currency.

In the third quarter of 2022, we recorded $ 7 million of non-cash intangible asset impairment losses to SG&A related to two trademarks in our former International segment that had net carrying values that were deemed not to be recoverable.

We estimate that amortization expense related to definite-lived intangible assets will be approximately $ 250 million in 2025 and for the following two years and $ 240 million in 2028 and 2029.

Provision for/(Benefit from) Income Taxes:

15 unchanged sentences

Many countries have enacted, or begun the process of enacting, laws based on the two-pillar plan proposals.

As part of our planning for the changes in the international tax environment, as well as to achieve greater operational synergies, we have enacted changes to our corporate entity structure which included a transfer of, and will result in the movement of, certain business operations to a wholly-owned subsidiary in the Netherlands resulting in a tax benefit of $ 3.0 billion recorded as a non-U.S.

As part of our planning for the changes in the international tax environment, as well as to achieve greater operational synergies, we have enacted changes to our corporate entity structure which included a transfer of, and resulted in the movement of, certain business operations to a wholly-owned subsidiary in the Netherlands resulting in a tax benefit of $ 3.0 billion recorded as a non-U.S.

deferred tax asset in December 2024.

1 unchanged sentence

The determination of the estimated fair value of the transferred business is complex and requires the exercise of substantial judgment due to the use of subjective assumptions in the valuation method used by management.

The associated valuation allowance of $ 0.6 billion is related to uncertainty in the Pillar Two legislative interpretation and is based on our latest assessment of the total tax benefit that is more likely than not to be realized.

The associated valuation allowance based on our latest assessment of the total tax benefit that is more likely than not to be realized was $ 0.7 billion as of December 27, 2025 and $ 0.6 billion as of December 28, 2024, and related to uncertainty in the Pillar Two legislative interpretation.

The recognition of our future tax benefits associated with this transaction is dependent upon the acceptance of the business valuation and tax basis step-up by the associated taxing authorities.

We record tax expense/(benefits) related to the exercise of stock options and other equity instruments within our tax provision.

Accordingly, we recognized an insignificant tax expense in our consolidated statements of income in 2024 and 2023, and an insignificant tax benefit in 2022 related to the exercise of stock options and other equity instruments.

Accordingly, we recognized an insignificant tax expense in our consolidated statements of income in 2025, 2024, and 2023 related to the exercise of stock options and other equity instruments.

Effective Tax Rate:

The effective tax rate on income/(loss) before income taxes differed from the U.S.

The effective tax rate on income/(loss) before income taxes for the years ended December 27, 2025 differed from the U.S.

federal statutory tax rate for the following reasons:

December 28, 2024 December 30, 2023 December 31, 2022

December 27, 2025

federal statutory tax rate $ ( 1,143 ) 21.0 %

State and local income taxes, net of federal (national) income tax expense (a)

Effects of cross-border tax laws

Nontaxable or nondeductible items

Goodwill impairment

1,105 ( 20.3 ) %

Foreign tax effects

Goodwill impairment

United Kingdom

Goodwill impairment

134 ( 2.5 ) %

Other foreign jurisdictions

Changes in unrecognized tax benefits

100 ( 1.8 ) %

Effective tax rate

$ 403 ( 7.4 ) %

(a) State taxes in Louisiana made up the majority (greater than 50 %) of the tax effect in this category.

The effective tax rate on income/(loss) before income taxes for the years ended December 28, 2024 and December 30, 2023 differed from the U.S.

federal statutory tax rate for the following reasons:

December 28, 2024 December 30, 2023

federal statutory tax rate 21.0 % 21.0 %

Tax on income of non-U.S.

9 unchanged sentences

Foreign income inclusion

1.9 % 0.5 % 0.5 %

Research and development credits ( 1.1 ) % ( 0.3 ) %

1 unchanged sentence

Equity awards

1.2 % 0.1 % 0.1 %

2.2 % 0.3 % 0.4 %

Effective tax rate ( 220.5 ) % 21.7 %

4 unchanged sentences

Additionally, the calculation of the percentage point impact of goodwill impairment and other items on the effective tax rate shown in the table above are affected by income/(loss) before income taxes.

The percentage point impacts on the effective tax rates fluctuate due to income/(loss) before income taxes, which included goodwill and intangible asset impairment losses in all years presented in the table.

The percentage point impacts on the effective tax rates fluctuate due to income/(loss) before income taxes, which included goodwill impairment losses in all years presented in the table.

Fluctuations in the amount of income generated across locations around the world could impact comparability of reconciling items between periods.

Additionally, small movements in tax rates due to a change in tax law or a change in tax rates that causes us to revalue our deferred tax balances produces volatility in our effective tax rate.

Our 2025 effective tax rate was an expense of 7.4 % on pre-tax loss.

Our effective tax rate was unfavorably impacted by non-deductible goodwill impairments.

Our 2024 effective tax rate was a benefit of 220.5 % on pre-tax income.

3 unchanged sentences

This impact was partly offset by establishing a partial valuation allowance against the Netherlands deferred tax asset and a full valuation allowance against the Brazil net deferred tax assets and non-deductible goodwill impairments.

The 2025 and 2024 year-over-year increase in the effective tax rate was due primarily to higher non-deductible goodwill impairments in the current year and recognizing a non-U.S.

deferred tax asset as a result of the movement of certain business operations to a wholly-owned subsidiary in the Netherlands offset by establishing valuation allowances on certain non-U.S.

deferred tax assets in the prior year.

Our 2023 effective tax rate was an expense of 21.7 % on pre-tax income.

5 unchanged sentences

deferred tax assets in the current year versus the prior year.

Our 2022 effective tax rate was an expense of 20.2 % on pre-tax income.

Our effective tax rate was impacted by the favorable geographic mix of pre-tax income in various non-U.S.

jurisdictions and certain favorable items, primarily the decrease in deferred tax liabilities due to the merger of certain foreign entities, the revaluation of deferred tax balances due to changes in state tax laws, and changes in estimates of certain 2021 U.S.

income and deductions.

This impact was partially offset by the impact of certain unfavorable items, primarily non-deductible goodwill impairments, the impact of the federal tax on GILTI, and the establishment of uncertain tax positions and valuation allowance reserves.

The 2023 and 2022 year-over-year increase in the effective tax rate was due primarily to the decrease in deferred tax liabilities due to the merger of certain foreign entities and the revaluation of deferred tax balances due to changes in state tax laws in the prior year versus the current year.

See Note 9, Goodwill and Intangible Assets , for additional information related to our impairment losses.

11 unchanged sentences

Intangible assets

( 3,171 ) ( 2,959 )

Deferred income

7 unchanged sentences

Net deferred income tax liabilities $ 6,383 $ 7,219

The decrease in net deferred income tax liabilities from December 30, 2023 to December 28, 2024 was primarily driven by recognizing a non-U.S.

deferred tax asset as a result of the movement of certain business operations to a wholly-owned subsidiary in the Netherlands offset by the establishment of a partial valuation allowance of approximately $ 0.6 billion and the establishment of a full valuation allowance on Brazil net deferred tax assets of approximately $ 140 million.

The decrease in net deferred income tax liabilities from December 28, 2024 to December 27, 2025 was primarily driven by a reduction of $ 625 million due to the impairment of intangible assets.

As of December 27, 2025, non-U.S.

11 unchanged sentences

If we had recognized all of these benefits, the impact on our effective tax rate would have been $ 455 million.

It is reasonably possible that our unrecognized tax benefits will decrease by an insignificant amount in the next 12 months primarily due to the progression of state audits in process.

Our unrecognized tax benefits for uncertain tax positions are included in income taxes payable and other non-current liabilities on our consolidated balance sheets.

8 unchanged sentences

Balance at the end of the period $ 480 $ 400 $ 443

Our unrecognized tax benefits increased during 2025 mainly as a result of a net increase for tax positions related to the current and prior years in the U.S.

and certain state and non-U.S.

jurisdictions, which were partially offset by decreases related to audit settlements with certain state and non-U.S.

taxing authorities and statute of limitations expirations.

Our unrecognized tax benefits decreased during 2024 mainly related to audit settlements with state, and non-U.S.

6 unchanged sentences

jurisdictions.

Our unrecognized tax benefits increased during 2022 mainly as a result of a net increase for tax positions related to the current and prior years in the U.S.

and certain state and non-U.S.

jurisdictions, which were partially offset by decreases related to audit settlements with certain state and non-U.S.

taxing authorities and statute of limitations expirations.

We include interest and penalties related to uncertain tax positions in our tax provision.

Our provision for/(benefit from) income taxes included a $ 19 million benefit in 2024, a $ 1 million expense in 2023, and a $ 20 million expense in 2022 related to interest and penalties.

Our provision for income taxes included a $ 26 million expense in 2025, a $ 19 million benefit in 2024, and a $ 1 million expense in 2023 related to interest and penalties.

Accrued interest and penalties were $ 109 million as of December 27, 2025 and $ 83 million as of December 28, 2024.

Cash Paid for Income Taxes:

Income taxes paid in cash were as follows (in millions):

December 27, 2025

We paid income taxes, net of refunds, of $ 721 million in 2025, $ 967 million in 2024, and $ 932 million in 2023.

The following jurisdictions each accounted for more than 5% of total income taxes paid, net of refunds (in millions):

December 27, 2025

United Kingdom

Other Income Tax Matters:

1 unchanged sentence

We are currently under examination for income taxes by the Internal Revenue Service (“IRS”) for the years 2018 through 2022.

In the third quarter of 2023, we received two Notices of Proposed Adjustment (the “NOPAs”) relating to transfer pricing with our foreign subsidiaries.

In 2023, we received two Notices of Proposed Adjustment (the “NOPAs”) relating to transfer pricing with our foreign subsidiaries for the years 2018 and 2019.

The NOPAs propose an increase to our U.S.

1 unchanged sentence

federal income tax expense and liability of approximately $ 200 million for 2018 and approximately $ 210 million for 2019, excluding interest, and assert penalties of approximately $ 85 million for each of 2018 and 2019.

third quarter of 2025, we received a NOPA for the years 2020 through 2022 that could result in additional U.S.

federal income tax expense and liability of approximately $ 200 million for 2020, $ 210 million for 2021, and $ 200 million for 2022, excluding interest and penalties for each year.

In the fourth quarter of 2025, we received a NOPA asserting penalties of approximately $ 85 million for each of the years of 2020, 2021, and 2022.

We strongly disagree with the IRS’s positions, believe that our tax positions are well documented and properly supported, and intend to vigorously contest the positions taken by the IRS and pursue all available administrative and judicial remedies.

Therefore, we have not recorded any reserves related to this issue.

We continue to maintain the same operating model and transfer pricing methodology with our foreign subsidiaries that was in place for the years 2018 and 2019, and the IRS began its audit of 2020, 2021, and 2022 during the first quarter of 2024.

We continue to maintain the same operating model and transfer pricing methodology with our foreign subsidiaries that was in place for the years 2018 through 2022.

We believe our income tax reserves are appropriate for all open tax years and that final adjudication of this matter will not have a material impact on our results of operations and cash flows.

2 unchanged sentences

In the normal course of business, we are subject to examination by taxing authorities throughout the world, including such major jurisdictions as Brazil, Canada, Italy, the Netherlands, the United Kingdom, and the United States.

As of December 28, 2024, we have substantially concluded all national income tax matters through 2021 for the United Kingdom, through 2018 for the Netherlands, through 2017 for Italy and the United States, through 2016 for Canada, and through 2013 for Brazil, with the exception of 2007 and 2008 which are under litigation.

As of December 27, 2025, we have substantially concluded all national income tax matters through 2022 for the United Kingdom, through 2019 for the Netherlands and for Italy, with the exception of 2015 for Italy which is under litigation, through 2017 for the United States and Canada, and through 2011 for Brazil, with the exception of 2007 and 2008 which are under litigation.

We have concluded all U.S.

state income tax matters through 2010.

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

The OBBBA includes changes to U.S.

tax law that was applicable to the Company beginning in 2025.

These changes include provisions allowing accelerated tax deductions for qualified property and research and development expenditures.

The OBBBA did not have a significant impact on our total tax provision as of December 27, 2025, and we do not expect the elective provisions of the law to have a material impact on our future effective tax rate.

Further, certain provisions of the OBBBA impact the timing of cash tax payments, which resulted in a reduction of our cash tax payments in 2025, and is expected to reduce cash tax payments in 2026;

however we do not expect these provisions to have a material impact on our cash flows in future periods.

Cash Held by International Subsidiaries:

3 unchanged sentences

The amount of unrecognized deferred tax liabilities for local country withholding taxes that would be owed, if repatriated, related to our 2018 through 2025 accumulated earnings of certain international subsidiaries is approximately $ 65 million.

Our undistributed historical earnings in foreign subsidiaries through December 31, 2017 are currently not considered to be indefinitely reinvested.

Our deferred tax liability associated with these undistributed historical earnings was insignificant at December 28, 2024 and December 30, 2023, and relates to local withholding taxes that will be owed when this cash is distributed.

Divestitures:

In the second quarter of 2022, we paid cash taxes of approximately $ 620 million related to the sale of certain assets and to the licensing of certain trademarks in our global cheese business to Lactalis .

Our undistributed historic earnings in foreign subsidiaries through December 31, 2017 are currently not considered to be indefinitely reinvested.

Our deferred tax liability associated with these undistributed historical earnings was insignificant at December 27, 2025 and December 28, 2024, and relates to local withholding taxes that would be owed when this cash is distributed.

Employees’ Stock Incentive Plans

46 unchanged sentences

Treasury rate in effect at the grant date, with a remaining term equal to the expected term of the options.

The expected term is the period over which our employees are expected to hold their options.

Due to the lack of historical data, we calculated expected term using the weighted average vesting period and the contractual term of the options.

The expected term is the period over which our employees are expected to hold their options and is derived using historical data.

We estimated volatility using a blended volatility approach of term-matched historical volatility from our daily stock prices and weighted average implied volatility.

5 unchanged sentences

Outstanding at December 28, 2024 6,720,421 $ 46.44

8,022,540 $ 46.87

Granted 936,208 30.71

5 unchanged sentences

3,474,156 47.25 — 3 years

The aggregate intrinsic value of stock options exercised during the period was insignificant in 2024 , $ 11 million in 2023 , and $ 24 million in 2022.

Cash received from options exercised was $ 8 million in 2024, $ 43 million in 2023, and $ 57 million in 2022.

The aggregate intrinsic value of stock options exercised during the period was insignificant in 2025 and 2024 , and $ 11 million in 2023.

Cash received from options exercised was insignificant in 2025 and 2024, and $ 43 million in 2023.

The tax benefit realized from stock options exercised were insignificant in 2025, 2024, and 2023.

2 unchanged sentences

Unvested options at December 28, 2024 1,964,129 $ 7.01

2,287,093 $ 7.04

Granted 936,208 4.90

5 unchanged sentences

RSUs represent a right to receive one share or the value of one share upon the terms and conditions set forth in the applicable plan and award agreement.

All outstanding RSUs are dividend eligible.

We used the stock price on the grant date to estimate the fair value of our RSUs.

Certain of our RSUs are not dividend eligible.

We discounted the fair value of these RSUs based on the dividend yield.

Dividend yield was estimated using the quarterly dividend divided by the three-month average stock price, annualized and continuously compounded.

The grant date fair value of RSUs is amortized to expense over the vesting period.

The weighted average grant date fair value per share of our RSUs granted during the year was $ 30.81 in 2025, $ 35.39 in 2024, and $ 38.24 in 2023.

All RSUs granted in 2024, 2023, and 2022 were dividend eligible.

Our RSU activity and related information was:

1 unchanged sentence

Outstanding at December 28, 2024 6,705,507 $ 37.31

7,722,870 $ 36.80

Granted 2,917,867 30.81

21 unchanged sentences

Outstanding at December 28, 2024 5,389,930 $ 31.77

4,855,432 $ 33.65

Granted 3,188,751 30.48

Forfeited ( 913,405 ) 32.26

Forfeited (a)

( 2,482,016 ) 31.89

Vested ( 636,428 ) 34.47

1 unchanged sentence

5,460,237 30.64

(a) Includes PSUs forfeited due to employee terminations and performance conditions that were not satisfied.

The aggregate fair value of PSUs that vested during the period was $ 20 million in 2025, $ 40 million in 2024, and $ 33 million in 2023.

32 unchanged sentences

( 309 ) — — —

Curtailments — — — —

Special/contractual termination benefits — — 1 —

Other — — 12 —

Benefit obligation at end of year 2,314 2,461 1,107 1,065

6 unchanged sentences

( 309 ) — — —

Other — — — ( 16 )

Fair value of plan assets at end of year 2,760 2,973 1,466 1,368

1 unchanged sentence

(a) Actuarial losses/(gains) were primarily due to a change in the discount rate assumption utilized in measuring plan obligations.

(b) Settlements represent the settlement of our pension benefit obligation of $ 282 million for one of our U.K.

pension plans in 2023.

(b) Settlements represent lump sum payments of $ 309 million in 2025.

The accumulated benefit obligation, which represents benefits earned to the measurement date, was $ 2.3 billion at December 27, 2025 and $ 2.5 billion at December 28, 2024 for the U.S.

pension plan.

pension plans.

The accumulated benefit obligation for the non-U.S.

14 unchanged sentences

Fair value of plan assets — — 15 17

plan was overfunded based on plan assets in excess of accumulated benefit obligations as of December 28, 2024 and December 30, 2023.

plans were overfunded based on plan assets in excess of accumulated benefit obligations as of December 27, 2025 and December 28, 2024.

For certain of our U.S.

4 unchanged sentences

Fair value of plan assets — — 15 31

plan was overfunded based on plan assets in excess of projected benefit obligations as of December 28, 2024 and December 30, 2023.

plans were overfunded based on plan assets in excess of projected benefit obligations as of December 27, 2025 and December 28, 2024.

We used the following weighted average assumptions to determine our projected benefit obligations under the pension plans:

34 unchanged sentences

The investment strategy expects equity investments to yield a higher return over the long term than fixed-income securities, while fixed-income securities are expected to provide certain matching characteristics to the plans’ benefit payment cash flow requirements.

Our investment policy specifies the type of investment vehicles appropriate for the applicable plan, asset allocation guidelines, criteria for the selection of investment managers, procedures to monitor overall investment performance as well as investment manager performance.

Our investment policy specifies the type of investment vehicles appropriate for the applicable plan, asset allocation guidelines, criteria for the selection of investment managers, and procedures to monitor overall investment performance as well as investment manager performance.

It also provides guidelines enabling the applicable plan fiduciaries to fulfill their responsibilities.

8 unchanged sentences

Our pension investment strategy for the U.S.

plan is designed to align our pension assets with our projected benefit obligation to reduce volatility.

plans is designed to align our pension assets with our projected benefit obligation to reduce volatility.

We target an investment of approximately 68 % of our U.S.

plan assets in fixed-income securities, approximately 15 % in alternatives, primarily real assets and diversified credit, and approximately 10 % in return-seeking assets, primarily equity securities.

plans assets in fixed-income securities, approximately 18 % in alternatives, primarily real assets and diversified credit, and approximately 14 % in return-seeking assets, primarily equity securities.

For pension plans outside the United States, our investment strategy is subject to local regulations and the asset/liability profiles of the plans in each individual country.

In aggregate, the long-term asset allocation targets of our non-U.S.

plans are broadly characterized as a mix of approximately 79 % fixed-income securities and certain insurance contracts, approximately 10 % in alternatives, primarily multi-asset credit, and approximately 11 % in return-seeking assets, primarily equity securities.

plans are broadly characterized as a mix of approximately 95 % in cash and cash equivalents, fixed-income securities, and alternatives, primarily multi-asset credit, approximately 3 % in return-seeking assets, primarily equity securities, and approximately 2 % in certain insurance contracts.

Our weighted average pension asset allocations for our U.S.

plans deviate from our target allocations due to a rebalancing of our plan asset portfolio, which was in process as of December 27, 2025.

We expect our pension asset allocations to more closely align to our pension investment target once those activities are completed.

The fair value of pension plan assets at December 27, 2025 was determined using the following fair value measurements (in millions):

39 unchanged sentences

These securities consist of publicly traded U.S.

fixed interest obligations (principally corporate bonds).

fixed interest obligations (principally corporate bonds and tax-exempt municipal bonds).

Such investments are valued through consultation and evaluation with brokers in the institutional market using quoted prices and other observable market data.

22 unchanged sentences

• Short-term investments.

Short-term investments largely consist of a money market fund, the fair value of which is based on the net asset value reported by the manager of the fund and supported by the unit prices of actual purchase and sale transactions.

Short-term investments, including cash and cash equivalents, largely consist of a money market fund, the fair value of which is based on the net asset value reported by the manager of the fund and supported by the unit prices of actual purchase and sale transactions.

The fair value of these investments measured at net asset value is excluded from the fair value hierarchy.

15 unchanged sentences

Employer Contributions:

In 2024, we contributed $ 7 million to our non-U.S.

We contributed $ 5 million in 2025, $ 7 million in 2024, and $ 11 million in 2023 to our non-U.S.

pension plans.

We did no t contribute to our U.S.

pension plan.

pension plans in 2025, 2024, or 2023.

We estimate that 2026 pension contributions will be approximately $ 6 million to our non-U.S.

1 unchanged sentence

We do no t plan to make contributions to our U.S.

pension plan in 2025.

pension plans in 2026.

Estimated future contributions take into consideration current economic conditions, which at this time are expected to have minimal impact on expected contributions for 2026.

Our actual contributions and plans may change due to many factors, including changes in tax, employee benefit, or other laws and regulations, tax deductibility, significant differences between expected and actual pension asset performance or interest rates, or other factors.

In 2023, we settled one of our U.K.

defined benefit pension plans, which resulted in a surplus asset.

During the third quarter of 2024, the surplus asset was distributed to Kraft Heinz as a negative contribution in the amount of $ 29 million net of tax, which is shown as a cash inflow on the Consolidated Statements of Cash Flows.

In 2024, we received the distribution of a surplus asset in the amount of $ 29 million, net of tax, related to the 2023 settlement of one of our U.K.

defined benefit pension plans.

We treated this cash inflow as a negative contribution within operating activities on the consolidated statements of cash flows.

Future Benefit Payments:

1 unchanged sentence

2031-2035 832 408

2030-2034 918 388

Postretirement Plans

7 unchanged sentences

Actuarial losses/(gains) (a)

( 39 ) ( 19 )

Plan amendments — —

Currency 4 ( 7 )

3 unchanged sentences

Employer contributions (b)

( 190 ) ( 139 )

Benefits paid ( 65 ) ( 69 )

2 unchanged sentences

(a) Actuarial losses/(gains) were primarily due to a change in the discount rate assumption utilized in measuring plan obligations.

(b) Refer to the Employer Contributions section within this footnote below for further discussion of the negative employer contributions in 2024.

(b) Refer to the Employer Contributions section within this footnote below for further discussion of the negative employer contributions.

We recognized the net postretirement benefit asset/(liability) on our consolidated balance sheets as follows (in millions):

7 unchanged sentences

Accumulated benefit obligation $ 77 $ 81

Fair value of plan assets — —

We used the following weighted average assumptions to determine our postretirement benefit obligations:

15 unchanged sentences

Amortization of unrecognized losses/(gains) ( 26 ) ( 22 ) ( 17 )

Curtailments — — —

Net postretirement cost/(benefit) $ ( 53 ) $ ( 54 ) $ ( 45 )

20 unchanged sentences

In aggregate, our long-term asset allocation targets are broadly characterized as a mix of approximately 76 % in fixed-income securities and approximately 24 % in return-seeking assets, primarily equity securities.

Our weighted average postretirement asset allocations deviate from our target allocations due to a rebalancing of our plan asset portfolio, which was in process as of December 27, 2025.

We expect our postretirement asset allocations to more closely align to our postretirement investment target once those activities are completed.

The fair value of postretirement benefit plan assets at December 27, 2025 was determined using the following fair value measurements (in millions):

17 unchanged sentences

Equity securities 151 151 — —

Cash and cash equivalents 1 1 — —

Fair value excluding investments measured at net asset value 655 $ 227 $ 428 $ —

32 unchanged sentences

• Short-term investments.

The fair value of these investments measured at net asset value is excluded from the fair value hierarchy.

2 unchanged sentences

Employer Contributions:

In 2024, we contributed $ 11 million to our postretirement benefit plans.

We contributed $ 10 million in 2025 and $ 11 million in 2024 and 2023 to our postretirement benefit plans.

We estimate that 2026 postretirement benefit plan contributions will be approximately $ 11 million.

2 unchanged sentences

During the fourth quarter of 2025, we amended the U.S.

postretirement medical plan to establish a sub-trust to permit the payment of certain benefits for active non-union employees using $ 200 million of the retiree plan surplus, which represents a portion of the retiree plan’s total surplus.

This amount was converted to cash and treated as a negative contribution which is shown as a cash inflow within operating activities on the consolidated statement of cash flows.

As a result of its designation for this purpose, the transferred amount is no longer considered an asset of the retiree plan and is recognized as restricted cash and recorded in other current assets and other non-current assets within the consolidated balance sheets.

In 2024, we amended the U.S.

postretirement medical plan to establish a sub-trust to permit the payment of certain benefits for active union employees using $ 150 million of the retiree plan surplus, which represents a portion of the retiree plan’s total surplus.

This amount was converted to cash and treated as a negative contribution which is shown as a cash inflow in operating activities on the consolidated statement of cash flows.

As a result of its designation for this purpose, the transferred amount is no longer considered an asset of the retiree plan and is recorded in restricted cash under other current assets and other non-current assets within the consolidated balance sheets.

This amount was converted to cash and treated as a negative contribution which is shown as a cash inflow within operating activities on the consolidated statement of cash flows.

Future Benefit Payments:

56 unchanged sentences

Total fair value $ 11 $ 53 $ 69 $ 273 $ 80 $ 326

(a) At December 28, 2024, the fair value of our derivative assets was recorded in other current assets ($ 71 million) and other non-current assets ($ 7 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($ 16 million) and other non-current liabilities ($ 1 million).

(a) At December 27, 2025, the fair value of our derivative assets was recorded in other current assets and the fair value of our derivative liabilities was recorded in other current liabilities ($ 42 million) and other non-current liabilities ($ 1 million).

(b) At December 27, 2025, the fair value of our derivative assets was recorded in other current assets ($ 38 million) and other non-current assets ($ 8 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($ 2 million) and other non-current liabilities ($ 208 million).

23 unchanged sentences

We had posted collateral related to commodity derivative margin requirements of $ 52 million at December 27, 2025 and $ 25 million at December 28, 2024, which were included in prepaid expenses on our consolidated balance sheets.

Level 1 financial assets and liabilities consist of commodity future and options contracts and are valued using quoted prices in active markets for identical assets and liabilities.

Level 2 financial assets and liabilities consist of commodity swaps, foreign exchange forwards, options, and swaps, and cross-currency swaps.

Level 1 derivative financial assets and liabilities consist of commodity future and options contracts and are valued using quoted prices in active markets for identical assets and liabilities.

Level 2 derivative financial assets and liabilities consist of commodity swaps, foreign exchange forwards, options, and swaps, and cross-currency contracts.

Commodity swaps are valued using an income approach based on the observable market commodity index prices less the contract rate multiplied by the notional amount.

2 unchanged sentences

This formula uses present value techniques and reflects the time value and intrinsic value based on observable market rates.

Cross-currency swaps are valued based on observable market spot and swap rates.

We did not have any Level 3 financial assets or liabilities in any period presented.

Our calculation of the fair value of financial instruments takes into consideration the risk of nonperformance, including counterparty credit risk.

Cross-currency contracts are valued based on observable market spot and swap rates.

We did not have any Level 3 derivative financial assets or liabilities in any period presented.

Our calculation of the fair value of derivative financial instruments takes into consideration the risk of nonperformance, including counterparty credit risk.

Net Investment Hedging:

At December 27, 2025, we had the following items designated as net investment hedges:

• Non-derivative foreign currency denominated debt with principal amounts of € 300 million and £ 400 million;

• Cross-currency contracts with notional amounts of C$ 1.4 billion ($ 1.0 billion), € 2.8 billion ($ 3.0 billion), JPY 9.6 billion ($ 68 million), and CNY 2.5 billion ($ 344 million).

The component of the gains and losses on our net investment in these designated foreign operations, driven by changes in foreign exchange rates, are economically offset by fair value movements on the effective portion of our cross-currency contracts and foreign exchange contracts.

• Non-derivative foreign currency denominated debt with principal amounts of € 2.4 billion;

• Cross-currency contracts with notional amounts of € 954 million ($ 1.0 billion), C$ 1.3 billion ($ 900 million), and JPY 9.6 billion ($ 68 million);

• Foreign exchange contracts with notional amounts of CNY 4.0 billion ($ 571 million).

The components of the gains and losses on our net investment in these designated foreign operations, driven by changes in foreign exchange rates, are economically offset by fair value movements on the effective portion of our cross-currency contracts and foreign exchange contracts.

Cash Flow Hedge Coverage:

At December 28, 2024, we had entered into foreign exchange contracts designated as cash flow hedges for periods not exceeding the next 3 years and into cross-currency contracts designated as cash flow hedges for periods not exceeding the next 5 years.

At December 27, 2025, we had entered into foreign exchange contracts designated as cash flow hedges for periods not exceeding the next 2 years.

Fair Value Hedge Coverage:

In 2024, we designated cross-currency contracts as fair value hedges of the foreign currency exposure of foreign currency denominated intercompany loans.

At December 28, 2024, the notional amounts of the cross-currency contracts were £ 683 million ($ 864 million) and MXN 4.8 billion ($ 251 million) and the carrying value of the hedged items was $ 1.1 billion.

The gains/(losses) on the hedged items, driven by changes in foreign exchange rates, are economically offset by fair value movements on the effective portion of our cross-currency contract, which is reported in the same income statement line item in the same period.

At December 27, 2025, we had fair value hedges of the foreign currency exposure of both intercompany and external foreign currency denominated loans:

• Foreign exchange contracts with notional amounts of £ 400 million ($ 540 million) and the carrying value of the hedged item of $ 539 million is included in the long-term debt on the consolidated balance sheets;

• Cross-currency contracts with notional amounts of £ 683 million ($ 864 million) and MXN 4.8 billion ($ 251 million) and the carrying value of intercompany hedged items of $ 1.2 billion.

The gains/(losses) on the hedged items, driven by changes in foreign exchange rates, are economically offset by fair value movements on the effective portion of our cross-currency and foreign exchange contracts, which are reported in the same income statement line item in the same period.

The amounts excluded from the assessment of effectiveness are recognized in earnings over the life of the hedge on a systematic and rational basis in the same line item as the hedged items.

Deferred Hedging Gains and Losses on Fair Value and Cash Flow Hedges:

Based on our valuation at December 28, 2024 and assuming market rates remain constant through contract maturities, we expect transfers to net income/(loss) of the existing losses reported in accumulated other comprehensive income/(losses) on interest rate cash flow hedges and cross-currency fair value hedges during the next 12 months to be insignificant.

Additionally, we expect transfers to net income/(loss) of the existing gains reported in accumulated other comprehensive income/(losses) during the next 12 months on foreign-currency cash flow hedges to be approximately $ 26 million and on cross-currency cash flow hedges to be insignificant.

Based on our valuation at December 27, 2025 and assuming market rates remain constant through contract maturities, we expect transfers to net income/(loss) of the existing losses reported in accumulated other comprehensive income/(losses) on interest rate cash flow hedges, foreign exchange cash flow hedges, foreign exchange fair value hedges, and cross-currency fair value hedges during the next 12 months to be insignificant.

Additionally, we expect transfers to net income/(loss) of the existing gains reported in accumulated other comprehensive income/(losses) during the next 12 months on cross-currency cash flow hedges to be insignificant.

Concentration of Credit Risk:

6 unchanged sentences

Gains and losses are recorded in net income/(loss) as a component of cost of products sold for our commodity contracts and other expense/(income) for our cross currency and foreign exchange contracts.

Acquisition Hedging:

We entered into foreign exchange derivative contracts to economically hedge the foreign currency exposure related to the cash consideration for the Hemmer Acquisition.

These derivative contracts settled in our second quarter of 2022.

The related derivative gains were $ 38 million, and were recorded within other expense/(income).

These gains are classified as other losses/

(gains) related to acquisitions and divestitures.

See Note 4, Acquisitions and Divestitures , for additional information related to the Hemmer Acquisition.

Derivative Impact on the Statements of Comprehensive Income:

19 unchanged sentences

Fair value hedges:

Foreign exchange contracts (excluded component)

( 2 ) — — Other expense/(income)

Cross-currency contracts (excluded component)

2 unchanged sentences

Derivative Impact on the Statements of Income:

The following tables present the pre-tax amounts of derivative gains/(losses) reclassified from accumulated other comprehensive income/(losses) to net income/(loss) and the affected income statement line items (in millions):

The following tables present the pre-tax amounts of derivative gains/(losses) recorded to net income/(loss) and the affected income statement line items (in millions):

December 27, 2025 December 28, 2024

6 unchanged sentences

Cross-currency contracts — ( 12 ) 230 — ( 30 ) ( 111 )

Cross-currency contracts (excluded component) — — — — — 25

Net investment hedges (a) :

1 unchanged sentence

Cross-currency contracts (excluded component) — 38 — — 49 —

Fair Value hedges:

Fair Value hedges (b) :

Foreign exchange contracts

Cross-currency contracts — — ( 60 ) — — ( 1 )

Cross-currency contracts (excluded component) (b)

Hedged items (b)

Cross-currency contracts (excluded component) (a)

Gains/(losses) related to derivatives not designated as hedging instruments:

6 unchanged sentences

(a) Represents the pre-tax amounts of derivative gains/(losses) reclassified from accumulated other comprehensive income/(losses) to net income/(loss).

(b) Represents the pre-tax amounts of the hedged items gains/(losses) in fair value hedges.

(b) Represents the pre-tax amounts of the hedge and hedged items gains/(losses) in fair value hedges.

(c) Represents recognition of realized hedge losses resulting from the discontinuance of cash flow hedges because the forecasted transactions were no longer probable of occurring.

December 30, 2023

Cost of products sold SG&A Interest expense Other expense/ (income)

Cost of products sold Interest expense Other expense/ (income)

Total amounts presented in the consolidated statements of income in which the following effects were recorded $ 17,714 $ 912 $ 27

3 unchanged sentences

Foreign exchange contracts (excluded component) ( 10 ) — —

Interest rate contracts — — ( 1 ) —

Cross-currency contracts — ( 27 ) 63

6 unchanged sentences

Foreign exchange contracts — — ( 12 )

Cross-currency contracts — — 3

Total gains/(losses) recognized in statements of income $ ( 82 ) $ 8 $ 59

1 unchanged sentence

Non-Derivative Impact on Statements of Comprehensive Income:

Related to our non-derivative foreign currency denominated debt instruments designated as net investment hedges, we recognized pre-tax gains of $ 37 million in 2024, pre-tax losses of $ 39 million in 2023, and pre-tax gains of $ 111 million in 2022.

Related to our non-derivative foreign currency denominated debt instruments designated as net investment hedges, we recognized pre-tax losses of $ 157 million in 2025, pre-tax gains of $ 37 million in 2024, and pre-tax losses of $ 39 million in 2023.

These amounts were recognized in other comprehensive income/(loss).

Available-for-sale securities:

We invest in certain marketable fixed-income debt securities that are classified as available-for-sale.

We classify our investments in commercial paper, corporate bonds, and U.S.

treasury and agency securities as Level 2 as these investments are valued through consultation and evaluation with brokers in the institutional market using quoted prices and other observable market data.

We classify our investments in money market funds as Level 1 as the fair values of these investments are based on quoted (unadjusted) prices in active markets for identical assets.

The following table presents our available-for-sale debt securities’ amortized cost basis, fair value and unrealized gains and losses by significant investment category (in millions):

December 27, 2025

Amortized Cost Basis

Gross Unrealized Gains

Gross Unrealized Losses

Estimated Fair Value

Debt securities:

Corporate bonds

$ 456 $ — $ — $ 456

Commercial paper

treasury and agency 72 — — 72

Money market funds

$ 1,281 $ — $ — $ 1,281

(a) Amortized cost basis excludes approximately $ 4 million of accrued interest.

We purchased $ 2.5 billion in corporate bonds, commercial paper, and U.S.

treasury and agency securities and received $ 1.3 billion in proceeds from maturity of corporate bonds, commercial paper, and U.S.

treasury and agency securities for the year ended December 27, 2025.

During the same period, no investments in corporate bonds, commercial paper, or U.S.

treasury and agency securities were sold prior to maturity.

We recognized no direct write-offs or allowances for credit losses in earnings for the year ended December 27, 2025.

Cash flows related to the purchases and sale/maturity of these marketable securities are classified in the consolidated statements of cash flows within investing activities.

The carrying values of our available-for-sale debt securities were included in the following line items in our consolidated balance sheet (in millions):

December 27, 2025

Cash and cash equivalents

Marketable securities

The contractual maturities of these available-for-sale debt securities are all within one-year as of December 27, 2025.

We had no available-for-sale debt securities as of December 28, 2024.

Accumulated Other Comprehensive Income/(Losses)

The components of, and changes in, accumulated other comprehensive income/(losses), net of tax, were as follows (in millions):

Foreign Currency Translation Adjustments Net Postemployment Benefit Plan Adjustments Net Cash Flow Hedge Adjustments Net Fair Value Hedges Total

Foreign Currency Translation Adjustments

Net Postemployment Benefit Plan Adjustments

Net Cash Flow Hedge Adjustments

Net Fair Value Hedges

Balance at December 31, 2022 $ ( 2,845 ) $ ( 30 ) $ 65 $ — $ ( 2,810 )

8 unchanged sentences

Net postemployment benefit losses/(gains) reclassified to net income/(loss) — 115 — — 115

Other activity 22 — ( 22 ) — —

Total other comprehensive income/(loss) 211 45 ( 50 ) — 206

Balance at December 30, 2023

( 2,634 ) 15 15 — ( 2,604 )

Foreign currency translation adjustments ( 486 ) — — — ( 486 )

5 unchanged sentences

Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss) — — 39 — 39

Amounts excluded from the effectiveness assessment of fair value hedges — — — ( 23 ) (23)

Net deferred losses/(gains) on fair value hedges reclassified to net income/(loss) — — — ( 3 ) (3)

Net actuarial gains/(losses) arising during the period — 35 — — 35

1 unchanged sentence

Net postemployment benefit losses/(gains) reclassified to net income/(loss) — ( 14 ) — — ( 14 )

Other activity 22 — ( 22 ) — —

Total other comprehensive income/(loss) ( 365 ) 14 66 ( 26 ) ( 311 )

Balance at December 28, 2024

( 2,999 ) 29 81 ( 26 ) ( 2,915 )

Foreign currency translation adjustments 998 — — — 998

10 unchanged sentences

Net postemployment benefit losses/(gains) reclassified to net income/(loss) — ( 6 ) — — ( 6 )

Other activity 15 — ( 15 ) — —

Total other comprehensive income/(loss) 698 ( 90 ) ( 83 ) 20 545

Balance at December 27, 2025

$ ( 2,301 ) $ ( 61 ) $ ( 2 ) $ ( 6 ) $ ( 2,370 )

The gross amount and related tax benefit/(expense) recorded in, and associated with, each component of other comprehensive income/(loss) were as follows (in millions):

22 unchanged sentences

Losses/(gains) on cash flow hedges:

Foreign exchange contracts (b)

Foreign exchange contracts (a) (b)

( 14 ) ( 7 ) ( 28 ) Cost of products sold

Foreign exchange contracts (b)

— — ( 2 ) SG&A

Foreign exchange contracts (b)

Foreign exchange contracts (a) (b)

— ( 54 ) 20 Other expense/(income)

Cross-currency contracts (b)

Cross-currency contracts (a) (b)

( 230 ) 111 ( 88 ) Other expense/(income)

Cross-currency contracts (b)

Cross-currency contracts (a) (b)

12 30 27 Interest expense

1 unchanged sentence

— 3 — Other expense/(income

Interest rate contracts (d)

— — 1 Interest expense

Losses/(gains) on fair value hedges:

Cross-currency contracts (e)

Cross-currency contracts (a)

( 10 ) ( 4 ) — Other expense/(income

3 unchanged sentences

Losses/(gains) on postemployment benefits:

Amortization of unrecognized losses/(gains) (f)

Amortization of unrecognized losses/(gains) (d)

$ ( 12 ) $ ( 9 ) $ ( 4 )

Amortization of prior service costs/(credits) (f)

Amortization of prior service costs/(credits) (d)

( 7 ) ( 10 ) ( 14 )

Settlement and curtailment losses/(gains) (f)

Settlement and curtailment losses/(gains) (d)

Losses/(gains) on postemployment benefits before income taxes ( 8 ) ( 19 ) 128

1 unchanged sentence

Losses/(gains) on postemployment benefits $ ( 6 ) $ ( 14 ) $ 115

(a) Represents recognition of the excluded component in net income/(loss).

(b) Includes amortization of the excluded component and the effective portion of the related hedges.

(a) Represents recognition of the excluded component in net income/(loss) following a systematic and rational approach.

(b) Includes the effective portion of the related hedges.

(c) Represents recognition of realized hedge losses resulting from the discontinuance of cash flow hedges because the forecasted transactions were no longer probable of occurring.

(d) Represents amortization of realized hedge losses that were deferred into accumulated other comprehensive income/(losses) through the maturity of the related long-term debt instruments.

(e) Represents amortization of the excluded component.

(f) These components are included in the computation of net periodic postemployment benefit costs.

(d) These components are included in the computation of net periodic postemployment benefit costs.

See Note 12, Postemployment Benefits , for additional information.

3 unchanged sentences

Transfers of Financial Assets:

Since 2020, we have had a nonrecourse accounts receivable factoring program whereby certain eligible receivables are sold to third-party financial institutions in exchange for cash.

The program provides us with an additional means for managing liquidity.

Under the terms of the arrangement, we act as the collecting agent on behalf of the financial institutions to collect amounts due from customers for the receivables sold.

We account for the transfer of receivables as a true sale at the point control is transferred through derecognition of the receivable on our consolidated balance sheet.

The accounts receivable factoring program was not utilized in 2024 as there were no receivables sold under the program during 2024, and no amounts were outstanding as of December 28, 2024.

There were no incremental costs of factoring receivables under this arrangement for the year ended December 28, 2024.

Prior to 2025, we had a nonrecourse accounts receivable factoring program whereby certain eligible receivables are sold to third-party financial institutions in exchange for cash.

Under the terms of the arrangement, we acted as the collecting agent on behalf of the financial institutions to collect amounts due from customers for the receivables sold.

We accounted for the transfer of receivables as a true sale at the point control is transferred through derecognition of the receivable on our consolidated balance sheet.

As of December 28, 2024, the Company elected not to renew this accounts receivable factoring program.

There were no outstanding obligations at the time the program was terminated.

The accounts receivable factoring program was not utilized in 2024 as there were no receivables sold under the program during 2024.

Receivables sold under this accounts receivable factoring program were approximately $ 863 million during 2023, with no amounts outstanding as of December 30, 2023.

The incremental costs of factoring receivables under this arrangement were insignificant for the year ended December 30, 2023.

Receivables sold under this accounts receivable factoring program were approximately $ 197 million during 2022, with an insignificant amount outstanding as of December 31, 2022.

The incremental costs of factoring receivables under this arrangement were insignificant for the year ended December 31, 2022.

The proceeds from the sales of receivables are included in cash from operating activities in the consolidated statement of cash flows.

As of December 28, 2024, the Company has elected not to renew the accounts receivable factoring program.

There were no outstanding obligations at the time the program was terminated.

Trade Payables Programs:

6 unchanged sentences

Supplier participation in these agreements is voluntary.

The amounts confirmed outstanding under these programs were $ 745 million at December 28, 2024 and $ 819 million at December 30, 2023.

The confirmed outstanding amounts under these programs were $ 755 million at December 27, 2025 and $ 745 million at December 28, 2024.

The amounts were included in trade payables on our consolidated balance sheets.

9 unchanged sentences

While we cannot predict with certainty the results of Legal Matters in which we are currently involved or may in the future be involved, we do not expect that the ultimate costs to resolve the Legal Matters that are currently pending will have a material adverse effect on our financial condition, results of operations, or cash flows.

Class Actions and Stockholder Derivative Actions:

The Kraft Heinz Company and certain of our current and former officers and directors were defendants in a consolidated securities class action lawsuit pending in the United States District Court for the Northern District of Illinois, Union Asset Management Holding AG, et al.

The Kraft Heinz Company, et al.

The consolidated amended class action complaint, which was filed on August 14, 2020 and also named 3G Capital, Inc.

and several of its subsidiaries and affiliates (the “3G Entities”) as defendants, asserted claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Rule 10b-5 promulgated thereunder, based on allegedly materially false or misleading statements and omissions in public statements, press releases, investor presentations, earnings calls, Company documents, and SEC filings regarding the Company’s business, financial results, and internal controls, and further alleged the 3G Entities engaged in insider trading and misappropriated the Company’s material, non-public information.

In February 2023, the parties to the litigation reached a preliminary class settlement agreement.

Related to that agreement, we recorded a net expense of $ 210 million within SG&A in our consolidated statements of income for the fourth quarter of 2022, representative of the Company’s then-estimated liability after insurance recoveries and contributions from other defendants.

The Company’s then-estimated liability and the insurance recoveries are reflected in current liabilities and current assets on the consolidated balance sheets at December 31, 2022.

In the third quarter of 2023, we paid our remaining liability after insurance recoveries.

On September 12, 2023, the United States District Court for the Northern District of Illinois issued a Judgment Approving Class Action Settlement, wherein it granted final approval of the class settlement and dismissed the lawsuit with prejudice.

Certain of The Kraft Heinz Company’s current and former officers and directors and the 3G Entities were named as defendants in two stockholder derivative actions previously pending in the Delaware Court of Chancery, Datnoff, et al.

Behring, et al.

, which was filed on May 6, 2022, and Felicetti, et al.

Behring, et al.

, which was filed on March 6, 2023.

The complaints alleged state law claims and contended that The Kraft Heinz Company’s Board of Directors wrongfully refused plaintiffs’ demands to pursue legal action against the named defendants.

Specifically, the complaints alleged that certain of the Company’s current and former officers and directors breached their fiduciary duties to the Company by purportedly making materially misleading statements and omissions regarding the Company’s financial performance and the impairment of its goodwill and intangible assets.

The complaints further alleged that the 3G Entities and certain of the Company’s current and former officers and directors breached their fiduciary duties by engaging in insider trading and misappropriating the Company’s material, non-public information, or aided and abetted such alleged breaches of fiduciary duty.

The complaints sought relief against the defendants, principally in the form of damages, disgorgement of all profits obtained from the alleged insider trading, contribution and indemnification, and an award of attorneys’ fees and costs.

The defendants filed a motion to dismiss the complaints, which the Delaware Chancery Court granted in an order dated July 23, 2024, dismissing the complaints with prejudice.

The plaintiffs filed a notice of appeal on August 19, 2024, followed by a notice of voluntary dismissal of the appeal on September 3, 2024.

The Delaware Supreme Court closed the case on September 4, 2024, formally concluding this matter in full.

Certain of The Kraft Heinz Company’s current and former officers and directors and the 3G Entities were also named as defendants in a consolidated stockholder derivative action, In re Kraft Heinz Company Derivative Litigation , which was filed in the Delaware Court of Chancery.

Stockholder Derivative Action:

Certain of The Kraft Heinz Company’s current and former officers and directors and the 3G Entities have been named as defendants in a consolidated stockholder derivative action, In re Kraft Heinz Company Derivative Litigation , which was originally filed in 2019 in the Delaware Court of Chancery.

The consolidated amended complaint, which was filed on April 27, 2020, alleged state law claims, contending that the 3G Entities were controlling stockholders who owed fiduciary duties to the Company, and that they breached those duties by allegedly engaging in insider trading and misappropriating the Company’s material, non-public information.

3 unchanged sentences

The plaintiffs filed a notice of appeal on January 13, 2022, and the Delaware Supreme Court affirmed the trial court’s dismissal with prejudice of the consolidated amended complaint in an order dated August 1, 2022.

One of the plaintiffs in said dismissed derivative litigation subsequently filed a new complaint, Erste Asset Management v.

One of the plaintiffs from the In re Kraft Heinz Company Derivative Litigation subsequently filed a new complaint, Erste Asset Management GmbH v.

, against certain current and former officers and directors of The Kraft Heinz Company on November 28, 2023 in the Delaware Court of Chancery, seeking to reinstate the plaintiff’s previously dismissed claims and recover attorneys’ fees and costs incurred in the dismissed litigation on the basis of alleged newly discovered evidence.

Specifically, the plaintiff alleges the 3G Entities caused the Company to make false and misleading public disclosures regarding the independence of two directors of The Kraft Heinz Company, one of whose independence plaintiff contends formed a basis for the court’s prior dismissal of the consolidated amended complaint.

The defendants filed a motion to dismiss the complaint, which the Delaware Chancery Court granted in an order dated August 8, 2024, dismissing the complaint with prejudice.

The plaintiff filed a notice of appeal on September 5, 2024.

The Delaware Supreme Court issued an opinion and order on June 9, 2025, reversing the trial court’s dismissal of the complaint and remanding the case to the trial court for further proceedings.

Following remand, the trial court entered a stipulation on December 1, 2025, consolidating the previously dismissed In re Kraft Heinz Company Derivative Litigation with the Erste Asset Management GmbH v.

suit under Case No.

2019-0587-LWW.

The stipulation also appointed the General Retirement System of the City of Detroit, the Police & Fire Retirement System of the City of Detroit, and Erste Asset Management GmbH as co-lead plaintiffs and their counsel as co-lead counsel.

On December 2, 2025, the plaintiffs filed a motion for leave to file a verified consolidated second amended complaint.

We intend to vigorously defend against this lawsuit;

8 unchanged sentences

While we cannot predict with certainty the resolution of these discussions, we do not expect that the ultimate costs to resolve this matter will have a material adverse effect on our financial condition, results of operations, or cash flows.

Since September 2021, the Company has been involved in an administrative proceeding with the environmental authority from the State of Goiás (“SEMAD”) regarding alleged pollution in the Capivara stream related to a Company facility in Brazil.

In March 2025, SEMAD issued a first instance administrative decision maintaining the initial infraction notice, and in September 2025, SEMAD issued a second instance administrative decision again maintaining the initial infraction notice.

In a separate action brought against the Company by the local Public Prosecutor in September 2025 relating to the same alleged pollution, the court of first instance imposed a penalty against the Company in November 2025.

Given that there are several available levels of appeal from both SEMAD’s administrative decision and the decision of the court in the Public Prosecutor’ action, we cannot predict with certainty how these matters will resolve;

however, we do not expect that the ultimate costs to resolve either matter will have a material adverse effect on our financial condition, results of operations, or cash flows.

Other Commitments and Contingencies

10 unchanged sentences

Together with Kraft Heinz Foods Company (“KHFC”), our 100% owned operating subsidiary, we have a credit agreement (the “Credit Agreement”), which provides for a five-year senior unsecured revolving credit facility in an aggregate amount of $ 4.0 billion (the “Senior Credit Facility”).

On September 27, 2024, we entered into an agreement to extend the maturity date of our Senior Credit Facility from July 8, 2028 to July 8, 2029.

On July 8, 2025, we entered into an amendment to this agreement to extend the maturity date from July 8, 2029 to July 8, 2030.

Further, the amendment modified certain financial covenants, which changed our required minimum shareholders’ equity balance (excluding accumulated other comprehensive income/(losses) from $ 35 billion to $ 25 billion, and added an allowable add-back to the minimum shareholders’ equity balance of up to $ 2 billion annually, commensurate with goodwill and intangible asset impairments recorded during the period.

The Credit Agreement includes a $ 1.0 billion sublimit for borrowings in Canadian dollars, euro, or British pound sterling, as well as a swingline sub-facility of up to $ 400 million, and a letter of credit sub-facility of up to $ 300 million.

2 unchanged sentences

The Credit Agreement contains customary representations, warranties, and covenants that are typical for these types of facilities and could, upon the occurrence of certain events of default, restrict our ability to access our Senior Credit Facility.

The Credit Agreement requires us to maintain a minimum shareholders’ equity (excluding accumulated other comprehensive income/(losses)) of at least $ 35 billion.

The obligations under the Credit Agreement are guaranteed by KHFC and The Kraft Heinz Company in the case of indebtedness and other liabilities of any subsidiary borrower.

No amounts were drawn on our Senior Credit Facility at December 27, 2025 or December 28, 2024.

No amounts were drawn on our Senior Credit Facility during the years ended December 28, 2024 or December 30, 2023.

No amounts were drawn on our Senior Credit Facility during the years ended December 27, 2025, December 28, 2024 or December 30, 2023.

From time to time, we obtain funding through our commercial paper programs.

We had no commercial paper outstanding at December 28, 2024 or at December 30, 2023.

We had no commercial paper outstanding during the year ended December 28, 2024, and the maximum amount of commercial paper outstanding was $ 150 million during the year ended and December 30, 2023.

We had no commercial paper outstanding at December 27, 2025, December 28, 2024 and December 30, 2023.

We had no commercial paper outstanding during the years ended December 27, 2025 and December 28, 2024, and the maximum amount of commercial paper outstanding was $ 150 million during the year ended December 30, 2023.

Long-Term Debt:

8 unchanged sentences

3.000 %– 7.125 %

$ 17,517 $ 16,535

Euro notes (c)

12 unchanged sentences

Long-term debt, excluding current portion $ 19,311 $ 19,215

(a) Priority of debt indicates the order which debt would be paid if all debt obligations were due on the same day.

(a) Priority of debt indicates the order in which debt would be paid if all debt obligations were due on the same day.

Senior secured debt takes priority over unsecured debt.

1 unchanged sentence

(b) Maturity dates and interest rates presented are for the outstanding long-term debt obligations at December 27, 2025.

Floating interest rates stated are as of December 28, 2024.

9 unchanged sentences

Thereafter 13,568

Open Market Debt Repurchases:

2022 Open Market Debt Repurchases

In 2022, we repurchased approximately $ 755 million of certain of our senior notes under Rule 10b5-1 plans, including $ 268 million in the second quarter of 2022 (the “Q2 2022 Repurchases”), $ 180 million in the third quarter of 2022 (the “Q3 2022 Repurchases”), and $ 307 million in the fourth quarter of 2022 (the “Q4 2022 Repurchases” and, together with the Q2 2022 Repurchases and the Q3 2022 Repurchases, the “2022 Repurchases”).

In connection with the 2022 Repurchases, we recognized a net gain on extinguishment of debt of approximately $ 38 million within interest expense on the consolidated statement of income for the year ended December 31, 2022, which included a net gain of $ 9 million in the second quarter of 2022 related to the Q2 2022 Repurchases, a net gain of $ 3 million in the third quarter of 2022 related to the Q3 2022 Repurchases, and a net gain of $ 26 million in the fourth quarter related to the Q4 2022 Repurchases.

This gain primarily reflects the write-off of unamortized premiums and a net discount associated with the 2022 Repurchases.

Related to the 2022 Repurchases, we recognized a debt prepayment and extinguishment benefit of $ 10 million on the consolidated statement of cash flows for the year ended December 31, 2022, which reflect the $ 38 million net gain on extinguishment of debt adjusted for the non-cash write-off of unamortized premiums of $ 33 million, unamortized debt issuance costs of $ 3 million, and unamortized discounts of $ 2 million.

Debt Issuances:

2025 Debt Issuances

In the first quarter of 2025, KHFC, our 100% owned operating subsidiary, issued 600 million euro aggregate principal amount of 3.250 % senior notes due March 2033, $ 500 million aggregate principal amount of 5.200 % senior notes due March 2032, and $ 500 million aggregate principal amount of 5.400 % senior notes due March 2035 (collectively, the “2025 Notes”).

The 2025 Notes are fully and unconditionally guaranteed by The Kraft Heinz Company as to payment of principal, premium, and interest on a senior unsecured basis.

2024 Debt Issuances

In the first quarter of 2024, KHFC issued 550 million euro aggregate principal amount of 3.500 % senior notes due March 2029 (the “2024 Notes”).

The 2024 Notes are fully and unconditionally guaranteed by The Kraft Heinz Company as to payment of principal, premium, and interest on a senior unsecured basis.

We used the net proceeds from the 2024 Notes for general corporate purposes, including to fund the repayment of our 550 million euro senior notes that matured in May 2024.

2023 Debt Issuances

1 unchanged sentence

The 2023 Notes are fully and unconditionally guaranteed by The Kraft Heinz Company as to payment of principal and interest on a senior unsecured basis.

We used the proceeds from the 2023 Notes for general corporate purposes, including to partially fund the repayment of our 750 million euro senior notes that matured in June 2023.

Debt Issuance Costs:

Debt issuance costs are reflected as a direct deduction of our current portion of long-term debt and long-term debt balances on the consolidated balance sheets.

We incurred an insignificant amount of debt issuance costs in 2024, 2023, and 2022.

Debt issuance costs are reflected as a direct deduction of the current portion of long-term debt and long-term debt balances on our consolidated balance sheets.

We incurred $ 15 million of debt issuance costs in 2025 and insignificant amount of debt issuance costs in 2024, and 2023.

Unamortized debt issuance costs were $ 78 million at December 27, 2025 and $ 75 million at December 28, 2024.

Amortization of debt issuance costs was $ 12 million in 2024 and $ 11 million in 2023 and 2022.

Amortization of debt issuance costs was $ 12 million in 2025, $ 12 million in 2024, and $ 11 million in 2023, and was reflected within interest expense on our consolidated statements of income.

Debt Premium:

Unamortized debt premiums are presented on the consolidated balance sheets as a direct addition to the carrying amount of debt.

Unamortized debt premiums are presented on our consolidated balance sheets as a direct addition to the carrying amount of debt.

Unamortized debt premium, net, was $ 194 million at December 27, 2025 and $ 217 million at December 28, 2024.

Amortization of our debt premium, net, was $ 16 million in 2024 and 2023, and $ 17 million in 2022.

Amortization of our debt premium, net, was $ 15 million in 2025, and $ 16 million in 2024 and 2023, and was reflected within interest expense on our consolidated statements of income.

Debt Repayments:

In May 2025, we repaid 600 million euro aggregate principal amount of senior notes that matured in the period.

In May 2024, we repaid 550 million euro aggregate principal amount of senior notes that matured in the period.

In June 2023, we repaid 750 million euro aggregate principal amount of senior notes that matured in the period.

In March 2022, we repaid $ 6 million aggregate principal amount of senior notes that matured in the period.

In June 2022, we repaid $ 381 million aggregate principal amount of senior notes that matured in the period.

In August 2022, we repaid $ 315 million aggregate principal amount of floating rate senior notes that matured in the period.

Fair Value of Debt:

27 unchanged sentences

We had no losses/(gains) on sale and leaseback transactions in 2025, 2024, and 2023.

Losses/(gains) on sales and leaseback transactions, net, were insignificant for 2022.

Supplemental balance sheet information related to our leases was (in millions, except lease term and discount rate):

31 unchanged sentences

Synthetic Lease Arrangements:

In June 2023, we entered into a non-cancellable synthetic lease for a distribution facility, for which we are the construction agent, that we now anticipate the estimated construction cost to be approximately $ 625 million.

In June 2023, we entered into a non-cancellable synthetic lease for a distribution facility, for which we are the construction agent, for which we now anticipate the estimated construction cost to be approximately $ 625 million.

The lease will commence upon completion of construction of the facility which is now expected to be in the later part of 2027.

2 unchanged sentences

Upon lease commencement, the lease classification, right-of-use asset, and lease liability will be determined and recorded.

The lease arrangement contains a residual value guarantee of approximately 85 % of the total construction cost.

The lease arrangement contains a residual value guarantee of 100 % of the total construction cost.

The construction agreement and lease contain covenants that are consistent with our Senior Credit Facility as disclosed in Note 17, Debt .

6 unchanged sentences

Balance at December 30, 2023

1,249 ( 31 ) 1,218

Exercise of stock options, issuance of other stock awards, repurchase of common stock, and other 5 ( 28 ) ( 23 )

Balance at December 28, 2024

1,254 ( 59 ) 1,195

Exercise of stock options, issuance of other stock awards, repurchase of common stock, and other 3 ( 14 ) ( 11 )

24 unchanged sentences

Segment Reporting

In the first quarter of 2024, our internal reporting and reportable segments changed.

We divided our International segment into three operating segments — EPDM, WEEM, and AEM — to enable enhanced focus on the different strategies required for each of these regions as part of our long-term strategic plan.

Subsequently, we manage our operating results through four operating segments.

We manage our operating results through four operating segments:

North America, Europe and Pacific Developed Markets (“EPDM” or “International Developed Markets”), West and East Emerging Markets (“WEEM”), and Asia Emerging Markets (“AEM”).

We have two reportable segments defined by geographic region:

1 unchanged sentence

Our remaining operating segments, consisting of WEEM and AEM, are combined and disclosed as Emerging Markets.

We have reflected this segment change in all historical periods presented.

As part of the segment reorganization, management reallocated certain corporate expenses previously reported within our International segment to general corporate expenses.

This reflects management’s approach to centrally manage these expenses.

We have reflected this reallocation in all historical periods presented.

Our chief operating decision maker (“CODM”), Carlos Abrams-Rivera, Chief Executive Officer, evaluates segment performance based on several factors, including net sales and Segment Adjusted Operating Income.

In the first quarter of 2024, following changes to our segments, our CODM reevaluated and changed the primary measure utilized to evaluate segment profitability from Segment Adjusted EBITDA to Segment Adjusted Operating Income.

We have reflected this change from Segment Adjusted EBITDA to Segment Adjusted Operating Income in all historical periods presented.

Segment Adjusted Operating Income is defined as operating income/(loss) excluding, when they occur, the impacts of restructuring activities, deal costs, unrealized gains/(losses) on commodity hedges (the unrealized gains and losses are recorded in general corporate expenses until realized;

Our chief operating decision maker (“CODM”) is our Chief Executive Officer.

Our CODM evaluates segment performance based on several factors, including net sales and Segment Adjusted Operating Income.

Segment Adjusted Operating Income is defined as operating income/(loss) excluding, when they occur, the impacts of restructuring activities, deal costs, separation costs, unrealized gains/(losses) on commodity hedges (the unrealized gains and losses are recorded in general corporate expenses until realized;

once realized, the gains and losses are recorded in the applicable segment’s operating results), impairment losses, and certain non-ordinary course legal and regulatory matters.

3 unchanged sentences

Therefore, we do not disclose assets by segment.

Carlos Abrams-Rivera served as our Chief Executive Officer during our fiscal year 2025.

Subsequent to our fiscal year ended December 27, 2025, the Company appointed Steve Cahillane as Chief Executive Officer effective January 1, 2026.

Emerging Markets represents the aggregation of our WEEM and AEM operating segments.

23 unchanged sentences

Impairment losses ( 9,306 )

Separation costs

Operating income/(loss) $ ( 4,669 )

2 unchanged sentences

Income/(loss) before income taxes $ ( 5,445 )

(a) Adjusted Cost of Products Sold is defined as cost of products sold excluding, when they occur, the impacts of restructuring activities, deal costs, unrealized gains/(losses) on commodity hedges (the unrealized gains and losses are recorded in general corporate expenses until realized;

(a) Adjusted Cost of Products Sold is defined as cost of products sold excluding, when they occur, the impacts of restructuring activities, deal costs, separation costs, unrealized gains/(losses) on commodity hedges (the unrealized gains and losses are recorded in general corporate expenses until realized;

once realized, the gains and losses are recorded in the applicable segment’s operating results), impairment losses, and certain non-ordinary course legal and regulatory matters.

12 unchanged sentences

Impairment losses ( 3,669 )

Certain non-ordinary course legal and regulatory matters ( 2 )

Operating income/(loss) $ 1,683

2 unchanged sentences

Income/(loss) before income taxes $ 856

once realized, the gains and losses are recorded in the applicable segment’s operating results), impairment losses, and certain non-ordinary course legal and regulatory matters.

10 unchanged sentences

Restructuring activities ( 60 )

Deal costs ( 9 )

Unrealized gains/(losses) on commodity hedges ( 1 )

5 unchanged sentences

Income/(loss) before income taxes $ 3,633

once realized, the gains and losses are recorded in the applicable segment’s operating results), impairment losses, and certain non-ordinary course legal and regulatory matters.

7 unchanged sentences

Emerging Markets

General corporate expenses 72 86 96

General corporate

Total depreciation and amortization expense $ 968 $ 948 $ 961

6 unchanged sentences

Emerging Markets

General corporate expenses 112 68 77

General corporate

Total capital expenditures $ 801 $ 1,024 $ 1,013

In the first quarter of 2024, we changed the way we manage our product portfolio to align with our future growth strategy.

As of December 28, 2024, we manage our product portfolio through eight consumer-driven product platforms:

We manage our product portfolio through eight consumer-driven product platforms:

Taste Elevation, Easy Ready Meals, Substantial Snacking, Desserts, Hydration, Cheese, Coffee, and Meats.

8 unchanged sentences

Coffee includes mainstream coffee, coffee pods, and premium coffee.

Meats includes cold cuts, bacon, and hot dogs.

Meats include cold cuts, bacon, and hot dogs.

Each platform is assigned a role within our business to help inform our resource allocation and investment decisions, which are made at the operating segment level.

1 unchanged sentence

Accelerate, Protect, and Balance.

Our Accelerate role contains platforms that are expected to have long-term high growth potential, generate higher gross margins, and are in markets in which we have higher market share.

Our Accelerate role contains platforms that are expected to have high growth potential, generate higher gross margins, and are in markets in which we have higher market share.

Our Protect role contains platforms that are expected to have moderate growth potential, tend to generate higher gross margins, and are in markets in which we have higher market share.

16 unchanged sentences

Total net sales $ 24,942 $ 25,846 $ 26,640

The net sales by platform for the years ended December 28, 2024 and December 30, 2023 presented in the table above has been corrected to conform to our previously disclosed platform definitions.

The update had no impact on net sales or on the consolidated financial statements and we do not believe they are material to the consolidated financial statements.

Concentration of Risk:

30 unchanged sentences

Loss/(gain) on sale of business

81 ( 4 ) ( 25 )

Interest income ( 122 ) ( 69 ) ( 40 )

8 unchanged sentences

See Note 13, Financial Instruments , for information related to our derivative impacts.

Other expense/(income) was income of $ 171 million in 2025 compared to $ 85 million in 2024.

This change was primarily driven by a $ 212 million net gain on derivative activities in 2025 compared to a $ 45 million net loss on derivative activities in 2024, a $ 53 million increase in interest income in 2025 compared to 2024, a $ 42 million loss on the sale of business in 2025 compared to a $ 81 million loss on the sale of business in 2024, and $ 4 million of income in other miscellaneous income in 2025 compared to $ 19 million of expense in other miscellaneous expense in 2024.

These impacts were partially offset by a $ 234 million net foreign exchange loss in 2025 compared to a $ 21 million net foreign exchange gain in 2024 and a $ 28 million decrease in net pension and postretirement non-service benefits in 2025 compared to 2024.

Other expense/(income) was $ 85 million of income in 2024 compared to $ 27 million of expense in 2023.

1 unchanged sentence

These impacts were partially offset by a $ 45 million net loss on derivative activities in 2024 compared to a $ 59 million net gain on derivative activities in 2023, a $ 81 million net loss on the sale of businesses in 2024 compared to a $ 4 million net gain on the sale of business in 2023, and a $ 19 million expense in other miscellaneous expenses in 2024 compared to a $ 4 million expense in other miscellaneous expenses in 2023.

Other expense/(income) was $ 27 million of expense in 2023 compared to $ 253 million of income in 2022.

This change was primarily driven by a $ 67 million net pension and postretirement non-service costs in 2023 compared to a $ 135 million net pension and postretirement non-service benefit in 2022, a $ 73 million net foreign exchange loss in 2023 compared to a $ 106 million net foreign exchange gain in 2022, and a $ 21 million decrease in gain on sale of businesses.

These impacts were partially offset by a $ 59 million net gain on derivative activities in 2023 compared to a $ 50 million net loss on derivative activities in 2022, and a $ 13 million increase in interest income as compared to the prior year period.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

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-K

Item 8. Financial Statements and Supplementary Data