What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2023-11-01 compared with 2023-07-27 · 239 added, 206 removed, 634 unchanged (41% of the section changed)

11 unchanged sentences

Our overall outlook for future snacks revenue growth remains strong;

however, we anticipate ongoing volatility in response to supply chain issues, including labor and transportation constraints.

We will continue to proactively manage our business in response to the evolving global economic environment and related uncertainty and business risks while also prioritizing and supporting our employees and customers.

however, we anticipate ongoing volatility.

We will continue to proactively manage our business in response to the evolving global economic environment, related uncertainty and business risks while also prioritizing and supporting our employees and customers.

We continue to take steps to mitigate impacts to our supply chain, operations, technology and assets.

6 unchanged sentences

We continue to evaluate the situation in Ukraine and Russia and our ability to control our operating activities and businesses on an ongoing basis and comply with applicable international sanctions, and we continue to consolidate both our Ukrainian and Russian subsidiaries.

During the second quarter of 2022, Ukraine generated 0.2% and Russia generated 3.7% of consolidated net revenue and during the second quarter of 2023, Ukraine generated 0.3% and Russia generated 2.8% of consolidated net revenue.

Our Russian net revenues declined in the second quarter of 2023 due to the suspension of advertising as well as currency weakness that more than offset increased pricing.

Despite the decrease in revenues, the profitability of our Russian business has increased significantly and contributed to the growth of our consolidated performance.

We continue to reduce our activities in Russia and expect further volume declines as we work to have the business operate on a stand-alone basis, with a self-sufficient supply chain before the end of the year.

During the third quarter of 2023, Ukraine generated 0.4% and Russia generated 2.7% of consolidated net revenue and during the third quarter of 2022, Ukraine generated 0.3% and Russia generated 4.6% of consolidated net revenue.

Our Russian net revenues declined in the third quarter of 2023 due to the suspension of advertising as well as currency weakness.

Despite the decrease in revenues, the profitability of our Russian business increased and contributed to the growth of our consolidated performance.

We continue to reduce our activities in Russia and expect volume declines as we work to have the business operate on a stand-alone basis, with a self-sufficient supply chain before the end of the year.

We cannot predict if the recent strength in our Russian business will continue in the future.

8 unchanged sentences

("Chipita"), a high-growth leader in the Central and Eastern European croissant and baked snacks category

Additionally in 2022, we announced our intention to divest our developed market gum and global Halls candy businesses and in the fourth quarter of 2022, we announced an agreement to sell the developed market gum business with an anticipated closing in the fourth quarter of 2023, subject to relevant antitrust approvals and closing conditions.

On October 1, 2023, we completed the sale of our developed market gum business to Perfetti Van Melle Group, excluding the Portugal business which we retained pending regulatory approval.

We completed the sale of the Portugal business to Perfetti Van Melle Group on October 23, 2023.

Refer to Note 2, Acquisitions and Divestitures , for additional details.

1 unchanged sentence

Keurig Dr Pepper Transactions

On March 2, 2023, we sold approximately 30 million shares of KDP, which reduced our ownership interest by 2.1% to 3.2%.

On March 2, 2023, we sold approximately 30 million shares of KDP, which reduced our ownership interest by 2.1 percentage points to 3.2%.

We recorded a pre-tax gain on equity method transactions of $493 million (or $366 million after-tax) during the first quarter of 2023.

4 unchanged sentences

JDE Peet’s Transactions

On April 3, 2023, we sold approximately 7.7 million shares of JDEP, which reduced our ownership interest by 1.6%, to 18.1%.

We received cash proceeds of €198 million ($217 million) and recorded a loss of €18 million ($19 million) on this sale during the three months ended June 30, 2023.

On March 30, 2023, we issued options to sell shares of JDEP in tranches equivalent to approximately 7.7 million shares.

These options are exercisable at maturity during the third quarter of 2023 with a potential impact to our ownership if the options are exercised.

On April 3, 2023, we sold approximately 7.7 million shares of JDEP, which reduced our ownership interest by 1.6 percentage points, to 18.1%.

We received cash proceeds of €198 million ($217 million) and recorded a loss of €18 million ($19 million) on this sale during the three months ended September 30, 2023.

On March 30, 2023, we issued options to sell shares of JDEP in tranches equivalent to approximately 7.7 million shares, exercisable at maturity during the third quarter of 2023.

During the three months ended September 30, 2023, options were exercised on 2.2 million shares, which reduced our ownership by 0.4 percentage point, from 18.1% to 17.7% of the total outstanding shares.

We received cash proceeds of €57 million ($62 million) and recorded a loss of €3 million ($4 million) for these sales during the three months ended September 30, 2023.

For additional information, refer to Note 6, Investments and Note 9, Financial Instruments.

2 unchanged sentences

Restrictions on in-store placement of some of those products went into effect in October 2022.

Although we are unable to estimate precisely the impact of the restrictions, they did not have a significant impact on our consolidated financial statements in the three and six months ended June 30, 2023.

Although we are unable to estimate precisely the impact of the restrictions, they did not have a significant impact on our consolidated financial statements in the three and nine months ended September 30, 2023.

We continue to monitor existing and potential future tax reform around the world.

On August 16, 2022, the U.S.

enacted the Inflation Reduction Act of 2022, which, among other things, implements a 15% minimum tax on book income of certain large corporations, a 1% excise tax on net stock repurchases and several tax incentives to promote clean energy.

Based on the guidance available thus far, while we meet the criteria of a large corporation we do not believe this legislation will have a material impact on our consolidated financial statements.

We will continue to evaluate it as additional guidance and clarification becomes available.

enacted the Inflation Reduction Act of 2022, which is effective for tax years beginning after December 31, 2022.

Based on the guidance available thus far, we do not expect this legislation to have a material impact on our consolidated financial statements but we will continue to evaluate it as additional guidance and clarification becomes available.

We also continue to monitor countries’ progress toward enactment of the Organization of Economic Cooperation and Development’s model rules on a global minimum tax.

While numerous countries have proposed new legislation in this area (and two countries have enacted it as of June 30, 2023), any new law is only expected to be effective for taxable years beginning after December 31, 2023.

While numerous countries have proposed new legislation in this area (and three countries have enacted it as of September 30, 2023), any new law

is only expected to be effective for taxable years beginning after December 31, 2023.

If broadly enacted, these laws could have a material effect on us.

12 unchanged sentences

Summary of Results

• Net revenues increased 17.0% to $8.5 billion in the second quarter of 2023 and increased 17.5% to $17.7 billion in the first six months of 2023 as compared to the same periods in the prior year.

In the second quarter and first six months of 2023, our net revenue growth continued to reflect strong demand for most of our snack category products in both our emerging and developed markets relative to 2022.

Overall, our net revenue growth in both the second quarter and first six months of 2023 was driven by higher net pricing, incremental net revenues from our acquisitions of Clif Bar and Ricolino in 2022 and favorable volume/mix (reflecting growth in the first quarter while the second quarter was flat), partially offset by unfavorable currency translation and the impact of divestitures in 2022.

• Organic Net Revenue, a non-GAAP financial measure, increased 15.8% to $8.4 billion in the second quarter of 2023 and increased 17.7% to $17.7 billion in the first six months of 2023 as compared to same periods in the prior year.

During the second quarter, Organic Net Revenue grew due to higher net pricing while volume/mix was flat.

During the first six months of 2023, Organic Net Revenue grew due to both higher net pricing and favorable volume/mix.

• Net revenues increased 16.3% to $9.0 billion in the third quarter of 2023 and increased 17.1% to $26.7 billion in the first nine months of 2023 as compared to the same periods in the prior year.

In the third quarter and first nine months of 2023, our net revenue growth continued to reflect strong demand for most of our snack category products in both our emerging and developed markets relative to 2022.

– Net revenue growth in the third quarter of 2023 was driven by higher net pricing, favorable volume/mix and incremental net revenues from our acquisitions of Ricolino and Clif Bar in 2022, partially offset by unfavorable currency translation.

– Net revenue growth in the first nine months of 2023 was driven by higher net pricing, incremental net revenues from our acquisitions of Clif Bar and Ricolino in 2022 and favorable volume/mix, partially offset by unfavorable currency translation and the impact of divestitures in 2022.

• Organic Net Revenue, a non-GAAP financial measure, increased 15.7% to $9.0 billion in the third quarter of 2023 and increased 17.0% to $26.6 billion in the first nine months of 2023 as compared to same periods in the prior year.

During both the third quarter and first nine months of 2023, Organic Net Revenue grew due to higher net pricing and favorable volume/mix.

Organic Net Revenue is on a constant currency basis and excludes revenue from acquisitions and divestitures.

Refer to Non-GAAP Financial Measures for the definition of Organic Net Revenue and Consolidated Results of Operations for our reconciliation with net revenues.

• Diluted EPS attributable to Mondelēz International increased 27.8% to $0.69 in the second quarter of 2023 and increased 91.3% to $2.20 in the first six months of 2023 as compared to the same period in the prior year.

– Diluted EPS increased in the second quarter of 2023, driven by favorable year-over-year change in mark-to-market impacts from currency and commodity derivatives, increase in Adjusted EPS, lower acquisition integration costs and contingent consideration adjustments and lapping prior-year initial impacts from enacted tax law changes.

These favorable items were partially offset by a mark-to-market loss on marketable securities, lapping prior-year net earnings from divestitures, higher divestiture-related costs, higher remeasurement loss of net monetary position, higher loss on equity method investment transactions and lapping prior-year decrease in estimated allowances and reserves associated with incremental costs incurred due to the war in Ukraine.

– Diluted EPS increased during the first six months of 2023, driven by a mark-to-market gain on marketable securities, net gain on equity method investment transactions, favorable year-over-year change in mark-to-market impacts from currency and commodity derivatives, an increase in Adjusted EPS, lapping prior-year incremental costs due to the war in Ukraine, lapping prior-year loss on debt extinguishment, lapping prior-year intangible asset impairment charges, lapping prior-year acquisition-related costs and lapping prior-year initial impacts from enacted tax law changes.

These favorable items were partially offset by lower net earnings from divestitures, higher equity investee items, higher divestiture-related costs, higher acquisition integration costs and contingent consideration adjustments and higher remeasurement loss of net monetary position.

• Adjusted EPS, a non-GAAP financial measure, increased 16.9% to $0.76 in the second quarter of 2023 and increased 13.0% to $1.65 in the first six months of 2023 as compared to the same periods in the prior year.

On a constant currency basis, Adjusted EPS increased 21.5% to $0.79 in the second quarter of 2023 and increased 19.9% to $1.75 in the first six months of 2023 as compared to the same periods in the prior year.

• Diluted EPS attributable to Mondelēz International increased 84.6% to $0.72 in the third quarter of 2023 and increased 89.6% to $2.92 in the first nine months of 2023 as compared to the same period in the prior year.

– Diluted EPS increased in the third quarter of 2023, driven by lapping prior-year acquisition-related costs, an increase in Adjusted EPS, favorable year-over-year change in mark-to-market impacts from currency and commodity derivatives, a gain on marketable securities and lapping prior-year inventory step-up charges.

These favorable items were partially offset by higher equity method investee items, higher acquisition integration costs and contingent consideration adjustments, higher intangible asset impairment charges, lapping prior-year net earnings from divestitures and higher remeasurement loss of net monetary position.

– Diluted EPS increased during the first nine months of 2023, driven by a gain on marketable securities, an increase in Adjusted EPS, favorable year-over-year change in mark-to-market impacts from currency and commodity derivatives, higher net gain on equity method investment transactions, lapping prior-year acquisition-related costs, lapping prior-year incremental costs due to the war in Ukraine, lapping prior-year loss on debt extinguishment, lower intangible asset impairment charges and lapping prior-year inventory step-up charges.

These favorable items were partially offset by higher equity method investee items, lower net earnings from divestitures, higher acquisition integration costs and contingent consideration adjustments, higher divestiture-related costs and higher remeasurement loss of net monetary position.

• Adjusted EPS, a non-GAAP financial measure, increased 13.9% to $0.82 in the third quarter of 2023 and increased 13.4% to $2.46 in the first nine months of 2023 as compared to the same periods in the prior year.

On a constant currency basis, Adjusted EPS increased 16.7% to $0.84 in the third quarter of 2023 and increased 18.9% to $2.58 in the first nine months of 2023 as compared to the same periods in the prior year.

Refer to Non-GAAP Financial Measures for the definition of Adjusted EPS and Consolidated Results of Operations for our reconciliation with diluted EPS.

– Adjusted EPS increased in the second quarter of 2023, primarily driven by operating gains, impact from acquisitions, fewer shares outstanding and higher equity method investment earnings, partially offset by unfavorable currency translation, higher taxes, higher interest expense and lower benefit plan non-service income.

– Adjusted EPS increased in the first six months of 2023, primarily driven by operating gains, impact from acquisitions, fewer shares outstanding and dividend income from marketable securities, partially offset by unfavorable currency translation, higher interest expense, higher taxes and lower benefit plan non-service income.

– Adjusted EPS increased in the third quarter of 2023, primarily driven by operating gains, lower interest expense, impact from acquisitions and fewer shares outstanding, partially offset by higher taxes, unfavorable currency translation, lower benefit plan non-service income and lower equity method investment net earnings.

– Adjusted EPS increased in the first nine months of 2023, primarily driven by operating gains, impact from acquisitions, fewer shares outstanding and dividend income from marketable securities, partially offset by unfavorable currency translation, higher taxes, lower benefit plan non-service income and lower equity method investment net earnings.

Discussion and Analysis of Historical Results

4 unchanged sentences

For the Three Months Ended

June 30, For the Six Months Ended

September 30, For the Nine Months Ended

September 30,

See Note 2023 2022 2023 2022

10 unchanged sentences

(68) (28) (143) (100)

Inventory step-up — (20) — (20)

Acquisition-related costs — (292) — (318)

7 unchanged sentences

Initial impacts from enacted tax law changes Note 14 (13) (13) (15) (22)

(Loss)/gain on marketable securities Note 6 (194) — 593 —

Gain on marketable securities

Note 6 — — 593 —

(Loss)/gain on equity method investment

2 unchanged sentences

Equity method investee items (4)

(38) 13 (82) 7

Effective tax rate Note 14 26.6 % 28.8 % 27.1 % 24.2 %

5 unchanged sentences

See footnote (1) as mark-to-market gains/(losses) on our equity method-investment-related derivative contracts are presented in the table above within mark-to-market gains/(losses) from derivatives.

(4) Includes our proportionate share of significant operating and non-operating items recorded by our JDE Peet's equity method investee, including acquisition and divestiture-related costs and restructuring program costs.

Consolidated Results of Operations

Three Months Ended June 30

Three Months Ended September 30

For the Three Months Ended

2023 2022 $ change % change

September 30,

2023 2022 $ Change

(in millions, except per share data)

7 unchanged sentences

0.72 0.39 0.33 84.6 %

Net Revenues – Net revenues increased $1,233 million (17.0%) to $8,507 million in the second quarter of 2023, and Organic Net Revenue (1) increased $1,151 million (15.8%) to $8,413 million.

Net Revenues – Net revenues increased $1,266 million (16.3%) to $9,029 million in the third quarter of 2023, and Organic Net Revenue (1) increased $1,215 million (15.7%) to $8,977 million.

Emerging markets net revenues increased 14.0% and emerging markets Organic Net Revenue increased 19.0% (1) .

4 unchanged sentences

International

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Reported (GAAP) $ 3,527 $ 5,502 $ 9,029

2 unchanged sentences

Organic (Non-GAAP) $ 3,682 $ 5,295 $ 8,977

Three Months Ended June 30, 2022

Three Months Ended September 30, 2022

Reported (GAAP) $ 3,094 $ 4,669 $ 7,763

9 unchanged sentences

(1) Please see the Non-GAAP Financial Measures section at the end of this item.

Net revenue increase of 17.0% was driven by our underlying Organic Net Revenue growth of 15.8% and the impact of acquisitions, partially offset by unfavorable currency translation and the impact of divestitures.

Net revenue increase of 16.3% was driven by our underlying Organic Net Revenue growth of 15.7% and the impact of acquisitions, partially offset by unfavorable currency translation.

Overall, we continued to see strong demand for our snack category products across most regions.

Organic Net Revenue growth was driven by higher net pricing as overall volume/mix was flat for the quarter.

Higher net pricing in all regions was due to the benefit of carryover pricing from 2022 as well as the effects of input cost-driven pricing actions taken during the first six months of 2023.

Volume/mix was flat as favorable volume/mix in North America, AMEA and Latin America was offset by unfavorable volume/mix in Europe reflecting the impact from customer price negotiation disruptions.

The November 1, 2022 acquisition of Ricolino added incremental net revenues of $137 million (constant currency basis) and the August 1, 2022 acquisition of Clif Bar added incremental net revenues of $240 million.

Unfavorable currency impacts decreased net revenues by $283 million, primarily due to the strength of the U.S.

dollar relative to most currencies, including the Argentinean peso, Russian ruble, Chinese yuan, Indian rupee, Turkish Lira, Egyptian pound, South African rand and Australian dollar, partially offset by the strength of a few currencies relative to the U.S.

dollar, primarily the Mexican peso and euro.

The impact of our 2022 divestitures resulted in a year-over-year reduction in net revenues of $12 million.

Organic Net Revenue growth was driven by higher net pricing and favorable volume/mix.

Higher net pricing in all regions was due to the benefit of carryover pricing from 2022 as well as the effects of input cost-driven pricing actions taken during the first nine months of 2023.

Volume/mix was favorable across all regions reflecting both improved product mix and volume gains.

The November 1, 2022 acquisition of Ricolino added incremental net revenues of $153 million (constant currency basis).

The August 1, 2022 acquisition of Clif Bar added incremental net revenues of $71 million through the one-year anniversary of the acquisition.

Refer to Note 2, Acquisitions and Divestitures, for additional information.

Operating Income – Operating income increased $498 million (53.7%) to $1,425 million in the second quarter of 2023.

Unfavorable currency impacts decreased net revenues by $172 million, primarily due to the strength of the U.S.

dollar relative to several currencies, including the Argentinean peso, Russian ruble, Egyptian pound, Nigerian naira, Turkish lira, Chinese yuan, Indian rupee and Australian dollar, partially offset by the strength of several currencies relative to the U.S.

dollar, primarily the euro, British pound sterling, Mexican peso and Brazilian real.

Operating Income – Operating income increased $700 million (103.1%) to $1,379 million in the third quarter of 2023.

Adjusted Operating Income (1) increased $258 million (20.6%) to $1,511 million and Adjusted Operating Income on a constant currency basis (1) increased $307 million (24.5%) to $1,560 million due to the following:

For the Three Months Ended

September 30,

2023 2022 $ Change % Change

2 unchanged sentences

Simplify to Grow Program (2)

Intangible asset impairment charge (3)

Mark-to-market (gains)/losses from derivatives (4)

2 unchanged sentences

contingent consideration adjustments (5)

Inventory step-up (5)

Acquisition-related costs (5)

Divestiture-related costs (5) (7)

Operating income from divestitures (4)

Incremental costs due to war in Ukraine (6)

16 unchanged sentences

(2) Refer to Note 7, Restructuring Program, for more information.

(3) Refer to Note 5, Goodwill and Intangible Assets , for more information.

(4) Refer to Note 9, Financial Instruments , and the Non-GAAP Financial Measures section at the end of this item for more information on the unrealized gains/losses on commodity and forecasted currency transaction derivatives.

1 unchanged sentence

(6) Refer to Note 1, Basis of Presentation , for information on our accounting for the war in Ukraine and our application of highly inflationary accounting for Argentina and Türkiye.

(6) Divestiture-related costs includes costs incurred associated with our publicly-announced processes to divest our developed markets gum and global Halls businesses.

During the second quarter of 2023, we realized higher net pricing and favorable volume/mix, which was partially offset by increased input costs.

Higher net pricing, which included the carryover impact of pricing actions taken in 2022 as well as the effects of input cost-driven pricing actions taken during the first six months of 2023, was reflected across all regions.

(7) Divestiture-related costs include costs incurred associated with our publicly announced processes to divest our developed markets gum and global Halls businesses.

During the third quarter of 2023, we realized higher net pricing and favorable volume/mix, which was partially offset by increased input costs.

Higher net pricing, which included the carryover impact of pricing actions taken in 2022 as well as the effects of input cost-driven pricing actions taken during the first nine months of 2023, was reflected across all regions.

Overall, volume/mix benefited from improved product mix and continued strong demand for our snack category products across most regions.

Favorable volume/mix was driven by AMEA, North America and Latin America, partially offset by unfavorable volume/mix in Europe reflecting the impact from customer price negotiation disruptions.

Favorable volume/mix was reflected across all regions.

The increase in input costs was driven by higher raw material costs, partially offset by lower manufacturing costs driven by productivity.

Higher raw material costs were in part due to higher energy, sugar, dairy, grains, packaging, cocoa, edible oils and other ingredients costs as well as unfavorable year-over-year currency exchange transaction costs on imported materials.

Total selling, general and administrative expenses increased $193 million from the second quarter of 2022, due to a number of factors noted in the table above, including in part, the impact of acquisitions, higher divestiture-related costs, higher remeasurement loss of net monetary position and lapping prior-year decrease in estimated allowances and reserves associated with incremental costs incurred due to the war in Ukraine, which were partially offset by a favorable currency impact related to expenses, lower acquisition integration costs and contingent consideration adjustments, lapping prior-year acquisition-related costs and lower implementation costs incurred for the Simplify to Grow program.

Excluding these factors, selling, general and administrative expenses also increased $145 million from the second quarter of 2022.

Higher raw material costs were in part due to unfavorable year-over-year currency exchange transaction costs on imported materials as well as higher sugar, energy and other ingredient costs, partially offset by lower dairy, edible oils, nuts, packaging and grains costs.

Total selling, general and administrative expenses increased $135 million from the third quarter of 2022, due to a number of factors noted in the table above, including in part, the impact of acquisitions, higher acquisition integration costs and contingent consideration adjustments, higher remeasurement loss of net monetary position, higher divestiture-related costs and lapping prior-year decrease in estimated allowances and reserves associated with incremental costs incurred due to the war in Ukraine, which were partially offset by lapping prior-year acquisition-related costs, a favorable currency impact related to expenses and lower implementation costs incurred for the Simplify to Grow program.

Excluding these factors, selling, general and administrative expenses increased $268 million from the third quarter of 2022.

The increase was driven primarily by higher advertising and consumer promotion costs and higher overhead costs in part due to increased investments in route to market capabilities.

Unfavorable currency changes decreased operating income by $49 million due primarily to the strength of the U.S.

dollar relative to most currencies, including the Russian ruble, Argentinean peso, Egyptian pound, Chinese yuan, Indian rupee and South African rand, partially offset by the strength of a few currencies relative to the U.S.

dollar, including the Mexican peso and euro.

Operating income margin increased from 12.7% in the second quarter of 2022 to 16.8% in the second quarter of 2023.

The increase was primarily driven by favorable year-over-year change in mark-to-market gains/(losses) from currency and commodity hedging activities, higher Adjusted Operating Income margin, lower costs incurred for the Simplify to Grow program and lower acquisition integration costs and contingent consideration adjustments, partially offset by higher divestiture-related costs, lapping prior-year decrease in estimated allowances and reserves associated with incremental costs incurred due to the war in Ukraine and higher remeasurement loss of net monetary position.

Adjusted Operating Income margin increased from 15.1% for the second quarter of 2022 to 15.7% for the second quarter of 2023.

The increase was driven primarily by higher net pricing, overhead cost leverage, lower manufacturing and favorable product mix, partially offset by higher raw material costs.

Net Earnings and Earnings per Share Attributable to Mondelēz International – Net earnings attributable to Mondelēz International of $944 million increased by $197 million (26.4%) in the second quarter of 2023.

Diluted EPS attributable to Mondelēz International was $0.69 in the second quarter of 2023, up $0.15 (27.8%) from the second quarter of 2022.

Adjusted EPS (1) was $0.76 in the second quarter of 2023, up $0.11 (16.9%) from the second quarter of 2022.

Adjusted EPS on a constant currency basis (1) was $0.79 in the second quarter of 2023, up $0.14 (21.5%) from the second quarter of 2022.

dollar relative to several currencies, including the Russian ruble, Egyptian pound, Turkish lira, Chinese yuan, Nigerian naira, Indian rupee, Argentinean peso and Australian dollar, partially offset by the strength of several currencies relative to the U.S.

dollar, including the euro, British pound sterling, Mexican peso and Brazilian real.

Operating income margin increased from 8.7% in the third quarter of 2022 to 15.3% in the third quarter of 2023.

The increase was primarily driven by lapping prior-year acquisition-related costs, favorable year-over-year change in mark-to-market gains/(losses) from currency and commodity hedging activities, higher Adjusted Operating Income margin and lapping prior-year inventory step-up charges, partially offset by higher acquisition integration costs and contingent consideration adjustments, higher divestiture-related costs and lapping prior-year decrease in estimated allowances and reserves associated with incremental costs incurred due to the war in Ukraine.

Adjusted Operating Income margin increased from 16.1% for the third quarter of 2022 to 16.7% for the third quarter of 2023.

The increase was driven primarily by higher net pricing, lower manufacturing costs driven by productivity, overhead cost leverage and favorable product mix, partially offset by higher raw material costs and higher advertising and consumer promotion costs.

Net Earnings and Earnings per Share Attributable to Mondelēz International – Net earnings attributable to Mondelēz International of $984 million increased by $452 million (85.0%) in the third quarter of 2023.

Diluted EPS attributable to Mondelēz International was $0.72 in the third quarter of 2023, up $0.33 (84.6%) from the third quarter of 2022.

Adjusted EPS (1) was $0.82 in the third quarter of 2023, up $0.10 (13.9%) from the third quarter of 2022.

Adjusted EPS on a constant currency basis (1) was $0.84 in the third quarter of 2023, up $0.12 (16.7%) from the third quarter of 2022.

For the Three Months Ended

September 30,

2023 2022 $ Change % Change

1 unchanged sentence

Simplify to Grow Program (2)

Intangible asset impairment charge (2)

0.02 0.01 0.01

Mark-to-market (gains)/losses from derivatives (2)

3 unchanged sentences

0.04 0.02 0.02

Divestiture-related costs (2)

Net earnings from divestitures (2)

Inventory step-up (2)

— 0.01 (0.01)

Incremental costs due to war in Ukraine (2)

Acquisition-related costs (2)

— 0.21 (0.21)

Net earnings from divestitures (2)

— (0.01) 0.01

Remeasurement of net monetary position (2)

1 unchanged sentence

Initial impacts from enacted tax law changes (3)

Gain on marketable securities (4)

(0.02) — (0.02)

Loss on marketable securities (4)

Loss on equity method investment transactions (4)

Equity method investee items (5)

0.03 (0.01) 0.04

16 unchanged sentences

GAAP results was computed based on the facts and tax assumptions associated with each item, and such impacts have also been excluded from Adjusted EPS.

• For the three months ended June 30, 2023, taxes for the:

Simplify to Grow Program were $(1) million, mark-to-market gains from derivatives were $21 million, acquisition integration costs and contingent consideration adjustments were $(9) million, divestiture-related costs were $(4) million, remeasurement of net monetary position were zero, initial impacts from enacted tax law changes were $2 million, loss on marketable securities were $(45) million and loss on equity method investment transactions were $(1) million.

• For the three months ended June 30, 2022, taxes for the:

Simplify to Grow Program were $(6) million, mark-to-market losses from derivatives were $(14) million, acquisition integration costs and contingent consideration adjustments were $(1) million, acquisition-related costs were $(2) million, divestiture-related costs were $(1) million, net earnings from divestitures were $7 million, incremental costs due to the war in Ukraine were zero, remeasurement of net monetary position were zero, initial impacts from enacted tax law changes were $9 million and loss on equity method transactions were zero.

• For the three months ended September 30, 2023, taxes for the:

Simplify to Grow Program were $(2) million, intangible asset impairment charges were $(6) million, mark-to-market gains from derivatives were $9 million, acquisition integration costs and contingent consideration adjustments were $(17) million, remeasurement of net monetary position were zero, initial impacts from enacted tax law changes were $13 million, gain on marketable securities were $(21) million and equity method investee items were zero.

• For the three months ended September 30, 2022, taxes for the:

Simplify to Grow Program were $(3) million, intangible asset impairment charges were $(6) million, mark-to-market losses from derivatives were $(22) million, acquisition integration costs and contingent consideration adjustments were $(6) million, inventory step-up charges were $(5) million, acquisition-related costs were zero, net earnings from divestitures were $2 million, remeasurement of net monetary position were zero, initial impacts from enacted tax law changes were $13 million and equity method investee items were zero.

(2) See the Operating Income table above and the related footnotes for more information.

1 unchanged sentence

(4) Refer to Note 6, Investments , for more information on gains/losses on equity method investment transactions and marketable securities.

(5) Includes our proportionate share of significant operating and non-operating items recorded by our JDE Peet's equity method investee, such as acquisition and divestiture-related costs and restructuring program costs.

(6) Excludes the currency impact on interest expense related to non-U.S.

1 unchanged sentence

(7) Refer to Note 11, Stock Plans , for more information on our equity compensation programs and share repurchase program and Note 15, Earnings per Share , for earnings per share weighted-average share information.

Six Months Ended June 30:

For the Six Months Ended

2023 2022 $ change % change

Nine Months Ended September 30:

For the Nine Months Ended

September 30,

2023 2022 $ Change

(in millions, except per share data)

7 unchanged sentences

2.92 1.54 1.38 89.6 %

Net Revenues – Net revenues increased $2,635 million (17.5%) to $17,673 million in the first six months of 2023, and Organic Net Revenue (1) increased $2,653 million (17.7%) to $17,670 million.

Net Revenues – Net revenues increased $3,901 million (17.1%) to $26,702 million in the first nine months of 2023, and Organic Net Revenue (1) increased $3,868 million (17.0%) to $26,647 million.

Emerging markets net revenues increased 17.7% and emerging markets Organic Net Revenue increased 22.5% (1) .

4 unchanged sentences

International

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Reported (GAAP) $ 10,431 $ 16,271 $ 26,702

2 unchanged sentences

Organic (Non-GAAP) $ 10,828 $ 15,819 $ 26,647

Six Months Ended June 30, 2022

Nine Months Ended September 30, 2022

Reported (GAAP) $ 8,864 $ 13,937 $ 22,801

12 unchanged sentences

Organic Net Revenue growth was driven by higher net pricing and favorable volume/mix.

Higher net pricing in all regions was due to the benefit of carryover pricing from 2022 as well as the effects of input cost-driven pricing actions taken during the first six months of 2023.

Favorable volume/mix was driven by AMEA, North America and Latin America reflecting both improved product mix and volume gains, partially offset by unfavorable volume/mix in Europe reflecting the impact from customer price negotiation disruptions.

The November 1, 2022 acquisition of Ricolino added incremental net revenues of $293 million (constant currency basis) and the August 1, 2022 acquisition of Clif Bar added incremental net revenues of $458 million.

Higher net pricing in all regions was due to the benefit of carryover pricing from 2022 as well as the effects of input cost-driven pricing actions taken during the first nine months of 2023.

Favorable volume/mix was driven by AMEA, North America and Latin America reflecting both improved product mix and volume gains, while volume/mix was flat in Europe.

The November 1, 2022 acquisition of Ricolino added incremental net revenues of $446 million (constant currency basis).

The August 1, 2022 acquisition of Clif Bar added incremental net revenues of $529 million through the one-year anniversary of the acquisition.

Unfavorable currency impacts decreased net revenues by $920 million, due primarily to the strength of the U.S.

dollar relative to most currencies, including the Argentinean peso, British pound sterling, Indian rupee, Egyptian pound, Turkish lira, Chinese yuan, euro, Australian dollar and South African rand, partially offset by the strength of a few currencies relative to the U.S.

dollar, primarily the Mexican peso.

dollar relative to several currencies, including the Argentinean peso, Russian ruble, Egyptian pound, Indian rupee, Turkish lira, Chinese yuan, Australian dollar, South African rand, Nigerian naira, British pound sterling and Pakistan rupee, partially offset by the strength of several currencies relative to the U.S.

dollar, including the Mexican peso, euro, Brazilian real and Polish zloty.

The impact of our 2022 divestitures resulted in a year-over-year reduction in net revenues of $22 million.

Refer to Note 2, Acquisitions and Divestitures, for additional information.

Operating Income – Operating income increased $909 million (45.0%) to $2,930 million in the first six months of 2023.

Operating Income – Operating income increased $1,609 million (59.6%) to $4,309 million in the first nine months of 2023.

Adjusted Operating Income (1) increased $697 million (18.7%) to $4,424 million and Adjusted Operating Income on a constant currency basis (1) increased $880 million (23.6%) to $4,607 million due to the following:

For the Six Months Ended

For the Nine Months Ended

September 30,

2023 2022 $ Change % Change

7 unchanged sentences

contingent consideration adjustments (5)

Inventory step-up (5)

Acquisition-related costs (5)

24 unchanged sentences

(6) Refer to Note 1, Basis of Presentation , for information on our accounting for the war in Ukraine and our application of highly inflationary accounting for Argentina and Türkiye.

(7) Divestiture-related costs includes costs incurred associated with our publicly-announced processes to divest our developed markets gum and global Halls businesses.

During the first six months of 2023, we realized higher net pricing and favorable volume/mix, which was partially offset by increased input costs.

(7) Divestiture-related costs include costs incurred associated with our publicly announced processes to divest our developed markets gum and global Halls businesses.

During the first nine months of 2023, we realized higher net pricing and favorable volume/mix, which was partially offset by increased input costs.

Overall, volume/mix benefited from improved product mix and continued strong demand for our snack category products across most regions.

Favorable volume/mix was driven by AMEA, Latin America and North America, partially offset by unfavorable volume/mix in Europe reflecting the impact from customer price negotiation disruptions.

Favorable volume/mix was reflected across all regions.

The increase in input costs was driven by higher raw material costs, partially offset by lower manufacturing costs driven by productivity.

Higher raw material costs were in part due to higher energy, dairy, sugar, grains, edible oils, packaging, cocoa, nuts and other ingredients costs as well as unfavorable year-over-year currency exchange transaction costs on imported materials.

Total selling, general and administrative expenses increased $355 million from the first six months of 2022, due to a number of factors noted in the table above, including in part, the impact of acquisitions, higher divestiture-related costs and higher remeasurement loss of net monetary position, which were partially offset by a favorable currency impact related to expenses, lapping prior-year acquisition-related costs, lapping prior-year incremental costs due to the war in Ukraine, lower implementation costs incurred for the Simplify to Grow program and lower acquisition integration costs and contingent consideration adjustments.

Excluding these factors, selling, general and administrative expenses increased $307 million from the first six months of 2022.

Higher raw material costs were in part due to higher energy, sugar, dairy, grains, packaging, edible oils, cocoa and other ingredients costs as well as unfavorable year-over-year currency exchange transaction costs on imported materials.

Total selling, general and administrative expenses increased $490 million from the first nine months of 2022, due to a number of factors noted in the table above, including in part, the impact of acquisitions, higher divestiture-related costs, higher remeasurement loss of net monetary position and higher acquisition integration costs and contingent consideration adjustments, which were partially offset by lapping prior-year acquisition-related costs, a favorable currency impact related to expenses, lower implementation costs incurred for the Simplify to Grow program and lapping prior-year incremental costs due to the war in Ukraine.

Excluding these factors, selling, general and administrative expenses increased $575 million from the first nine months of 2022.

The increase was driven primarily by higher advertising and consumer promotion costs and higher overhead costs in part due to increased investments in route to market capabilities.

Unfavorable currency changes decreased operating income by $183 million primarily due to the strength of the U.S.

dollar relative to most currencies, including the Argentinean peso, British pound sterling, Egyptian pound, Russian ruble, Indian rupee, Chinese yuan, and South African rand, partially offset by the strength of a few currencies relative to the U.S.

dollar, primarily the Mexican peso.

Operating income margin increased from 13.4% in the first six months of 2022 to 16.6% in the first six months of 2023.

The increase in operating income margin was driven primarily by the favorable year-over-year change in mark-to-market gains/(losses) from currency and commodity hedging activities, lapping prior-year incremental costs due to the war in Ukraine, lapping prior-year intangible asset impairment charges, lower costs incurred for the Simplify to Grow program and lapping prior-year acquisition-related costs, partially offset by higher divestiture-related costs, and higher remeasurement loss of net monetary position.

Adjusted Operating Income margin of 16.5% for the first six months of 2023 was flat compared to the first six months of 2022, as higher net pricing and overhead cost leverage was offset by higher raw material costs.

Net Earnings and Earnings per Share Attributable to Mondelēz International – Net earnings attributable to Mondelēz International of $3,025 million increased by $1,423 million (88.8%) in the first six months of 2023 .

Diluted EPS attributable to Mondelēz International was $2.20 in the first six months of 2023, up $1.05 (91.3%) from the first six months of 2022.

Adjusted EPS (1) was $1.65 in the first six months of 2023, up $0.19 (13.0%) from the first six months of 2022.

Adjusted EPS on a constant currency basis (1) was $1.75 in the first six months of 2023, up $0.29 (19.9%) from the first six months of 2022.

For the Six Months Ended

dollar relative to most currencies, including the Russian ruble, Argentinean peso, Egyptian pound, Chinese yuan, Indian rupee, Turkish lira, Australian dollar, South African rand and British pound sterling, partially offset by the strength of a few currencies relative to the U.S.

dollar, primarily the Mexican peso and euro.

Operating income margin increased from 11.8% in the first nine months of 2022 to 16.1% in the first nine months of 2023.

The increase in operating income margin was driven primarily by the favorable year-over-year change in mark-to-market gains/(losses) from currency and commodity hedging activities, lapping prior-year acquisition-related costs, lapping prior-year incremental costs due to the war in Ukraine, lower intangible asset impairment charges, higher Adjusted Operating Income margin, lower costs incurred for the Simplify to Grow program and lapping prior-year inventory step-up charges, partially offset by higher acquisition integration costs and contingent consideration adjustments, higher divestiture-related costs and higher remeasurement loss of net monetary position.

Adjusted Operating Income margin increased from 16.4% for the first nine months of 2022 to 16.6% for the first nine months of 2023.

The increase was driven primarily by higher net pricing, overhead cost leverage, lower manufacturing costs driven by productivity and favorable product mix, partially offset by higher raw material costs and higher advertising and consumer promotion costs.

Net Earnings and Earnings per Share Attributable to Mondelēz International – Net earnings attributable to Mondelēz International of $4,009 million increased by $1,875 million (87.9%) in the first nine months of 2023 .

Diluted EPS attributable to Mondelēz International was $2.92 in the first nine months of 2023, up $1.38 (89.6%) from the first nine months of 2022.

Adjusted EPS (1) was $2.46 in the first nine months of 2023, up $0.29 (13.4%) from the first nine months of 2022.

Adjusted EPS on a constant currency basis (1) was $2.58 in the first nine months of 2023, up $0.41 (18.9%) from the first nine months of 2022.

For the Nine Months Ended

September 30,

2023 2022 $ Change % Change

8 unchanged sentences

0.08 0.03 0.05

Inventory step-up — 0.01 (0.01)

Acquisition-related costs (2)

1 unchanged sentence

Divestiture-related costs (2)

0.03 0.01 0.02

Net earnings from divestitures (2)

7 unchanged sentences

Initial impacts from enacted tax law changes (4)

— 0.01 (0.01)

Gain on marketable securities (5)

21 unchanged sentences

GAAP results was computed based on the facts and tax assumptions associated with each item, and such impacts have also been excluded from Adjusted EPS.

• For the six months ended June 30, 2023, taxes for the:

Simplify to Grow Program were $(7) million, mark-to-market gains from derivatives were $29 million, acquisition integration costs and contingent consideration adjustments were $(22) million, divestiture-related costs were $(8) million, net earnings from divestitures were $4 million, remeasurement of net monetary position were zero, initial impacts from enacted tax law changes were $2 million, gain on marketable securities were $156 million, gain on equity method investment transactions were $124 million and equity method investee items were zero.

• For the six months ended June 30, 2022, taxes for the:

Simplify to Grow Program were $(13) million, intangible asset impairment charge was $(19) million, mark-to-market losses from derivatives were $(19) million, acquisition integration costs and contingent consideration adjustments were $(51) million, acquisition-related costs were $(3) million, net earnings from divestitures were $17 million, incremental costs due to the war in Ukraine were $2 million, remeasurement of net monetary position were zero, loss on debt extinguishment and related expenses were $(31) million, initial impacts from enacted tax law changes were $9 million and loss on equity method investment transactions were zero.

• For the nine months ended September 30, 2023, taxes for the:

Simplify to Grow Program were $(9) million, intangible asset impairment charges were $(6) million, mark-to-market gains from derivatives were $38 million, acquisition integration costs and contingent consideration adjustments were $(39) million, divestiture-related costs were $(22) million, net earnings from divestitures were $4 million, remeasurement of net monetary position were zero, initial impacts from enacted tax law changes were $15 million, gain on marketable securities were $135 million, gain on equity method investment transactions were $124 million and equity method investee items were zero.

• For the nine months ended September 30, 2022, taxes for the:

Simplify to Grow Program were $(16) million, intangible asset impairment charge was $(25) million, mark-to-market losses from derivatives were $(41) million, acquisition integration costs and contingent consideration adjustments were $(57) million, inventory step-up charges were $(5) million, acquisition-related costs were $(3) million, divestiture-related costs were $(3) million, net earnings from divestitures were $19 million, incremental costs due to the war in Ukraine were $4 million, remeasurement of net monetary position were zero, loss on debt extinguishment and related expenses

were $(31) million, initial impacts from enacted tax law changes were $22 million, loss on equity method investment transactions were $1 million and equity method investee items were zero.

(2) See the Operating Income table above and the related footnotes for more information.

17 unchanged sentences

For the Three Months Ended

June 30, For the Six Months Ended

September 30, For the Nine Months Ended

September 30,

2023 2022 2023 2022

24 unchanged sentences

For the Three Months Ended

2023 2022 $ change % change

September 30,

2023 2022 $ Change

(in millions)

1 unchanged sentence

Segment operating income 156 112 44 39.3 %

For the Six Months Ended

2023 2022 $ change % change

For the Nine Months Ended

September 30,

2023 2022 $ Change

(in millions)

1 unchanged sentence

Segment operating income 429 305 124 40.7 %

Three Months Ended June 30

Three Months Ended September 30:

Net revenues increased $392 million (42.9%), due to higher net pricing (31.5 pp), the impact of an acquisition (16.8 pp) and favorable volume/mix (3.6 pp), partially offset by unfavorable currency (8.8 pp) and the impact of divestitures (0.2 pp).

Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories, primarily in Argentina, Brazil and Mexico.

The November 1, 2022 acquisition of Ricolino added incremental net revenues of $137 million (constant currency basis) in the second quarter of 2023.

Favorable volume/mix reflected continued strong demand for our snack category products.

Favorable volume/mix was driven by gains in gum, biscuits & baked snacks and candy, partially offset by declines in chocolate, refreshment beverages and cheese & grocery.

The November 1, 2022 acquisition of Ricolino added incremental net revenues of $153 million (constant currency basis) in the third quarter of 2023.

Favorable volume/mix reflected continued strong demand for most of our snack category products.

Favorable volume/mix was driven by gains in gum, candy, chocolate and cheese & grocery, partially offset by declines in refreshment beverages and biscuits & baked snacks.

Unfavorable currency impacts were primarily due to the strength of the U.S.

dollar relative to several currencies in the region, primarily the Argentinean peso, Colombian peso and Brazilian real, partially offset by the strength of several currencies relative to the U.S.

dollar, primarily the Mexican peso.

dollar relative to a few currencies in the region, primarily the Argentinean peso, partially offset by the strength of most currencies relative to the U.S.

dollar, primarily the Mexican peso and Brazilian real.

The impact of divestitures resulted in a year-over-year decline in net revenues of $1 million.

Segment operating income increased $44 million (48.9%), primarily due to higher net pricing, the impact of our Ricolino acquisition and favorable volume/mix.

These favorable items were partially offset by higher raw material costs, higher other selling, general and administrative expenses, higher advertising and consumer promotion costs, unfavorable currency and acquisition integration costs incurred in the second quarter of 2023.

Six Months Ended June 30:

Segment operating income increased $44 million (39.3%), primarily due to higher net pricing, the impact of our Ricolino acquisition, lower manufacturing costs driven by productivity, favorable currency and favorable volume/mix.

These favorable items were partially offset by higher raw material costs, higher other selling, general and administrative expenses, higher advertising and consumer promotion costs, higher remeasurement loss on net monetary position and higher acquisition integration costs.

Nine Months Ended September 30:

Net revenues increased $1,129 million (43.2%), due to higher net pricing (32.7 pp), the impact of an acquisition (17.2 pp) and favorable volume/mix (4.5 pp), partially offset by unfavorable currency (10.0 pp) and the impact of divestitures (1.2 pp).

Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories, primarily in Argentina, Brazil and Mexico.

The November 1, 2022 acquisition of Ricolino added incremental net revenues of $293 million (constant currency basis) in the first six months of 2023.

Favorable volume/mix reflected strong volume growth as the region continued to see increased demand for our snack category products.

The November 1, 2022 acquisition of Ricolino added incremental net revenues of $446 million (constant currency basis) in the first nine months of 2023.

Favorable volume/mix reflected strong volume growth as the region continued to see increased demand for most of our snack category products.

Favorable volume/mix was driven by gains in gum, biscuits & baked snacks, candy and cheese & grocery, partially offset by declines in refreshment beverages and chocolate.

Unfavorable currency impacts were primarily due to the strength of the U.S.

dollar relative to several currencies in the region, primarily the Argentinean peso and Colombian peso, partially offset by the strength of several currencies relative to the U.S.

dollar, primarily the Mexican peso.

dollar relative to a few currencies in the region, primarily the Argentinean peso and Colombian peso, partially offset by the strength of most currencies relative to the U.S.

dollar, primarily the Mexican peso and Brazilian real.

The impact of divestitures resulted in a year-over-year decline in net revenues of $22 million.

Segment operating income increased $80 million (41.5%), primarily due to higher net pricing, favorable volume/mix and the impact of our Ricolino acquisition.

These favorable items were partially offset by higher raw material costs, higher other selling, general and administrative expenses, higher advertising and consumer promotion costs, acquisition integration costs incurred in the first six months of 2023, unfavorable currency and higher remeasurement loss on net monetary position.

Segment operating income increased $124 million (40.7%), primarily due to higher net pricing, the impact of our Ricolino acquisition, favorable volume/mix and lower manufacturing costs driven by productivity.

These favorable items were partially offset by higher raw material costs, higher other selling, general and administrative expenses, higher advertising and consumer promotion costs, higher acquisition integration costs and higher remeasurement loss on net monetary position.

For the Three Months Ended

2023 2022 $ change % change

September 30,

2023 2022 $ Change

(in millions)

1 unchanged sentence

Segment operating income 302 257 45 17.5 %

For the Six Months Ended

2023 2022 $ change % change

For the Nine Months Ended

September 30,

2023 2022 $ Change

(in millions)

1 unchanged sentence

Segment operating income 869 740 129 17.4 %

Three Months Ended June 30

Three Months Ended September 30:

Net revenues increased $87 million (5.1%), due to higher net pricing (8.6 pp) and favorable volume/mix (3.3 pp), partially offset by unfavorable currency (6.8 pp).

Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories.

Favorable volume/mix reflected continued strong demand for our snack category products.

Favorable volume/mix was driven by gains in chocolate, gum, candy and refreshment beverages, partially offset by declines in biscuits & baked snacks and cheese & grocery.

Favorable volume/mix reflected continued strong demand for most of our snack category products.

Favorable volume/mix was driven by gains in chocolate, gum and candy, partially offset by declines in biscuits & baked snacks, refreshment beverages and cheese & grocery.

Unfavorable currency impacts were due to the strength of the U.S.

dollar relative to most currencies in the region, including the Chinese yuan, Indian rupee, Egyptian pound, South African Rand and Australian dollar.

Segment operating income decreased $4 million (1.9%), primarily due to higher raw material costs, higher other selling, general and administrative expenses, higher advertising and consumer promotion costs and unfavorable currency.

These unfavorable items were partially offset by higher net pricing, favorable volume/mix and lower manufacturing costs driven by productivity.

Six Months Ended June 30:

dollar relative to most currencies in the region, including the Egyptian pound, Nigerian naira, Chinese yuan, Indian rupee, Australian dollar and South African Rand.

Segment operating income increased $45 million (17.5%), primarily due to higher net pricing, lower manufacturing costs driven by productivity, lapping prior-year intangible asset impairment charges and favorable volume/mix.

These unfavorable items were partially offset by higher raw material costs, higher advertising and consumer promotion costs, unfavorable currency, higher other selling, general and administrative expenses and higher fixed asset impairment charges.

Nine Months Ended September 30:

Net revenues increased $233 million (4.6%), due to higher net pricing (8.8 pp) and favorable volume/mix (4.2 pp), partially offset by unfavorable currency (8.4 pp).

Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories.

Favorable volume/mix reflected overall volume gains from increased demand for our snack category products.

Favorable volume/mix was driven by gains in chocolate, refreshment beverages, gum, candy and biscuits & baked snacks, partially offset by a decline in cheese & grocery.

Favorable volume/mix reflected overall volume gains from increased demand for most of our snack category products.

Favorable volume/mix was driven by gains in chocolate, gum, candy and refreshment beverages, partially offset by declines in biscuits & baked snacks and cheese & grocery.

Unfavorable currency impacts were due to the strength of the U.S.

dollar relative to most currencies in the region, including the Indian rupee, Egyptian pound, Chinese yuan, Australian dollar, South African Rand and Pakistan rupee.

dollar relative to most currencies in the region, including the Egyptian pound, Indian rupee, Chinese yuan, Australian dollar, South African Rand, Nigerian naira, Pakistan rupee and Philippine peso.

Segment operating income increased $129 million (17.4%), primarily due to higher net pricing, favorable volume/mix, lapping prior-year intangible asset impairment charges and lower manufacturing costs driven by productivity.

1 unchanged sentence

For the Three Months Ended

2023 2022 $ change % change

September 30,

2023 2022 $ Change

(in millions)

1 unchanged sentence

Segment operating income 494 413 81 19.6 %

For the Six Months Ended

2023 2022 $ change % change

For the Nine Months Ended

September 30,

2023 2022 $ Change

(in millions)

1 unchanged sentence

Segment operating income 1,450 1,170 280 23.9 %

Three Months Ended June 30

Net revenues increased $300 million (11.4%), due to higher net pricing (17.6 pp), partially offset by unfavorable volume/mix (4.5 pp) and unfavorable currency (1.7 pp).

Three Months Ended September 30:

Net revenues increased $437 million (16.5%), due to higher net pricing (12.1 pp), favorable volume/mix (3.3 pp) and favorable currency (1.1 pp).

Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories.

Overall, unfavorable volume/mix reflected volume declines due to the impact from customer price negotiation disruptions.

Unfavorable volume/mix was driven by declines in biscuits & baked snacks, cheese & grocery, chocolate and candy, partially offset by gains in gum and refreshment beverages.

Unfavorable currency impacts reflected the strength of the U.S.

dollar relative to several currencies across the region, including the Russian ruble and Turkish lira, partially offset by the strength of several currencies relative to the U.S.

dollar, primarily the euro.

Segment operating income increased $69 million (18.2%), primarily due to higher net pricing, lower other selling, general and administrative expenses, lower acquisition integration costs, lower manufacturing costs driven by productivity and lower costs incurred for the Simplify to Grow program.

These favorable items were partially offset by higher raw material costs, unfavorable volume/mix, unfavorable currency, remeasurement loss on monetary position, lapping the prior-year decrease in estimated allowances and reserves associated with incremental costs incurred due to the war in Ukraine, divestiture-related costs incurred in the second quarter of 2023, and higher advertising and consumer promotion costs.

Six Months Ended June 30:

Net revenues increased $672 million (12.1%), due to higher net pricing (17.7 pp), partially offset by unfavorable currency (4.1 pp) and unfavorable volume/mix (1.5 pp).

Favorable volume/mix reflected overall volume gains from increased demand for most of our snack category products.

Favorable volume/mix was driven by gains in biscuits & baked snacks, gum and chocolate, partially offset by declines in cheese & grocery, candy and refreshment beverages.

Favorable currency impacts reflected the strength of several currencies relative to the U.S.

dollar, including the euro, British pound sterling and Polish zloty, partially offset by the strength of the U.S.

dollar relative to several currencies across the region, including the Russian ruble and Turkish lira.

Segment operating income increased $81 million (19.6%), primarily due to higher net pricing, favorable volume/mix, lower manufacturing costs driven by productivity, lower other selling, general and administrative expenses, lower acquisition integration costs and lower costs incurred for the Simplify to Grow program.

These favorable items were partially offset by higher raw material costs, higher advertising and consumer promotion costs, unfavorable currency, divestiture-related costs incurred in the third quarter of 2023, lapping the prior-year decrease in estimated allowances and reserves associated with incremental costs incurred due to the war in Ukraine and an intangible asset impairment charge incurred in the third quarter of 2023.

Nine Months Ended September 30:

Net revenues increased $1,109 million (13.5%), due to higher net pricing (15.9 pp), partially offset by unfavorable currency (2.4 pp), while volume/mix was flat.

Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories.

Unfavorable currency impacts reflected the strength of the U.S.

dollar relative to most currencies across the region, including the British pound sterling, Turkish lira, euro, Ukrainian hryvnya, Norwegian krone, Russian ruble and Swedish krona.

Overall, unfavorable volume/mix reflected volume declines due to the impact from customer price negotiation disruptions.

Unfavorable volume/mix was driven by declines in biscuits & baked snacks, cheese & grocery and chocolate, partially offset by gains in gum, candy and refreshment beverages.

Segment operating income increased $199 million (26.3%), primarily due to higher net pricing, lapping the prior-year incremental costs incurred due to the war in Ukraine, lower other selling, general and administrative expenses and lower acquisition integration costs.

These favorable items were partially offset by higher raw material costs, unfavorable currency, divestiture-related costs incurred in the first six months of 2023, higher advertising and consumer promotion costs, unfavorable volume/mix, higher manufacturing costs, remeasurement loss on net monetary position and higher costs incurred for the Simplify to Grow program.

dollar relative to several currencies across the region, including the Russian ruble, Turkish lira, British pound sterling, Ukrainian hryvnya, Norwegian krone and Swedish krona, partially offset by the strength of several currencies relative to the U.S.

dollar, including the euro, Polish zloty and Swiss franc.

Volume/mix was flat overall as gains in gum, biscuits & baked snacks, refreshment beverages and candy were offset by declines in cheese & grocery and chocolate.

Segment operating income increased $280 million (23.9%), primarily due to higher net pricing, lapping the prior-year incremental costs incurred due to the war in Ukraine, lower other selling, general and administrative expenses, lower acquisition integration costs, favorable volume/mix and lower manufacturing costs driven by productivity.

These favorable items were partially offset by higher raw material costs, unfavorable currency, higher advertising and consumer promotion costs, divestiture-related costs incurred in the first nine months of 2023, higher remeasurement loss on net monetary position, higher costs incurred for the Simplify to Grow program, higher fixed asset impairment charges and an intangible asset impairment charge incurred in the first nine months of 2023.

North America

For the Three Months Ended

2023 2022 $ change % change

September 30,

2023 2022 $ Change

(in millions)

1 unchanged sentence

Segment operating income 532 465 67 14.4 %

For the Six Months Ended

2023 2022 $ change % change

For the Nine Months Ended

September 30,

2023 2022 $ Change

(in millions)

1 unchanged sentence

Segment operating income 1,678 1,337 341 25.5 %

Three Months Ended June 30

Net revenues increased $507 million (22.7%), due to the impact of an acquisition (10.8 pp), higher net pricing (10.4 pp) and favorable volume/mix (2.0 pp), partially offset by unfavorable currency (0.5 pp).

The August 1, 2022 acquisition of Clif Bar added incremental net revenues of $240 million in the second quarter of 2023.

Three Months Ended September 30:

Net revenues increased $350 million (14.0%), due to higher net pricing (6.8 pp), favorable volume/mix (4.6 pp) and the impact of an acquisition (2.9 pp), partially offset by unfavorable currency (0.3 pp).

Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories.

Overall, favorable volume/mix reflected volume gains from increased demand for our snack category products.

Favorable volume/mix was driven by gains in biscuits & baked snacks and gum, partially offset by declines in candy and chocolate.

Favorable volume/mix was driven by gains in gum, biscuits & baked snacks, candy and chocolate.

The August 1, 2022 acquisition of Clif Bar added incremental net revenues of $71 million in the third quarter of 2023.

Unfavorable currency impact was due to the strength of the U.S.

dollar relative to the Canadian dollar.

Segment operating income increased $126 million (27.8%), primarily due to higher net pricing, the impact of our Clif Bar acquisition, lower manufacturing costs driven by productivity, favorable volume/mix and lower costs incurred for the Simplify to Grow Program.

These favorable items were partially offset by higher raw material costs, higher other selling, general and administrative expenses, higher advertising and consumer promotion costs, higher acquisition integration costs and contingent consideration adjustments, higher divestiture-related costs and higher fixed asset impairment charges.

Six Months Ended June 30:

Segment operating income increased $67 million (14.4%), primarily due to higher net pricing, favorable volume/mix, lapping prior-year inventory step-up charges and the impact of our Clif Bar acquisition.

These favorable items were partially offset by higher raw material costs, higher advertising and consumer promotion costs, higher acquisition integration costs and contingent consideration adjustments, an intangible asset impairment charge incurred in the third quarter of 2023, higher costs incurred for the Simplify to Grow Program, higher manufacturing costs, higher other selling, general and administrative expenses and higher fixed asset impairment charges.

Nine Months Ended September 30:

Net revenues increased $1,430 million (20.8%), due to higher net pricing (10.6 pp), the impact of an acquisition (7.7 pp) and favorable volume/mix (3.0 pp), partially offset by unfavorable currency (0.5 pp).

Higher net pricing, driven by input cost-driven pricing actions, was reflected across all categories.

The August 1, 2022 acquisition of Clif Bar added incremental net revenues of $458 million in the first six months of 2023.

The August 1, 2022 acquisition of Clif Bar added incremental net revenues of $529 million in the first nine months of 2023.

Overall, favorable volume/mix reflected volume gains from increased demand for our snack category products.

Favorable volume/mix was driven by gains in biscuits & baked snacks and gum, partially offset by declines in candy and chocolate.

Favorable volume/mix was driven by gains in biscuits & baked snacks, gum, chocolate and candy.

Unfavorable currency impact was due to the strength of the U.S.

dollar relative to the Canadian dollar.

Segment operating income increased $274 million (31.4%), primarily due to higher net pricing, the impact of our Clif Bar acquisition, favorable volume/mix, lower costs incurred for the Simplify to Grow Program and lower manufacturing costs driven by productivity.

These favorable items were partially offset by higher raw material costs, higher advertising and consumer promotion costs, higher other selling, general and administrative expenses, higher acquisition integration costs and contingent consideration adjustments, higher fixed asset impairment charges, higher divestiture-related costs and unfavorable currency.

Segment operating income increased $341 million (25.5%), primarily due to higher net pricing, favorable volume/mix, the impact of our Clif Bar acquisition, lapping prior-year inventory step-up charges, lower costs incurred for the Simplify to Grow Program and lower manufacturing costs driven by productivity.

These favorable items were partially offset by higher raw material costs, higher advertising and consumer promotion costs, higher acquisition integration costs and contingent consideration adjustments, higher other selling, general and administrative expenses, an intangible asset impairment charge incurred in the first nine months of 2023, higher fixed asset impairment charges, divestiture-related costs incurred in the first nine months of 2023 and unfavorable currency.

Liquidity and Capital Resources

14 unchanged sentences

Our cash flow activity is noted below:

Six Months Ended June 30, 2023

For the Nine Months Ended

September 30,

(in millions)

3 unchanged sentences

Net Cash Provided by Operating Activities

The change in net cash provided by operating activities was essentially flat primarily due to an increase in cash-basis net earnings partially offset by increased year-over-year working capital requirements.

The increase in net cash provided by operating activities was primarily due to an increase in cash-basis net earnings combined with favorable year-over-year working capital requirements.

This is largely a result of business growth and acquisitions completed during 2022.

Net Cash (Used in)/Provided by Investing Activities

The improvement in net cash provided by/used in investing activities was largely driven by higher proceeds from the current year KDP and JDEP share sales compared to the prior year JDEP share sale (refer to Note 6, Investments ) and lapping prior-year cash consideration paid for the Chipita acquisition (refer to Note 2, Acquisitions and Divestitures ).

The improvement in net cash provided by/used in investing activities was largely driven by lapping prior-year cash consideration paid for the Chipita and Clif Bar acquisitions (refer to Note 2, Acquisitions and Divestitures ) and higher proceeds from the current year KDP and JDEP share sales compared to the prior year JDEP share sale (refer to Note 6, Investments ), partially offset by lapping higher proceeds from the settlement and replacement of net investment hedge derivative contracts.

We continue to make capital expenditures primarily to modernize manufacturing facilities, implement new product manufacturing and support productivity initiatives.

We expect 2023 capital expenditures to be up to $1.2 billion, including capital expenditures in connection with our Simplify to Grow Program and for funding our strategic priorities.

We expect 2023 capital expenditures to be up to $1.2 billion, including capital expenditures in connection with our Simplify to Grow

Program and for funding our strategic priorities.

We expect to continue to fund these expenditures with cash from operations.

Net Cash Used in Financing Activities

The increase in cash used in financing activities was primarily due to lower debt proceeds, partially offset by lower share repurchases in the first six months of 2023 compared to the same prior-year period.

We paid dividends of $1,055 million in the first six months of 2023 and $977 million in the first six months of 2022.

The second quarter 2023 dividend of $0.385 per share, declared on May 17, 2023 for shareholders of record as of June 30, 2023, was paid on July 14, 2023.

On July 27, 2023, the Audit Committee, with authorization delegated from our Board of Directors, declared a quarterly cash dividend of $0.425 per share of Class A Common Stock, an increase of 10 percent.

This dividend is payable on October 13, 2023, to shareholders of record as of September 29, 2023.

The increase in cash used in financing activities was primarily due to lower debt proceeds, partially offset by lower share repurchases in the first nine months of 2023 compared to the same prior-year period.

We paid dividends of $1,581 million in the first nine months of 2023 and $1,457 million in the first nine months of 2022.

The third quarter 2023 dividend of $0.425 per share, declared on July 27, 2023 for shareholders of record as of September 29, 2023, was paid on October 13, 2023.

The declaration of dividends is subject to the discretion of our Board of Directors and depends on various factors, including our net earnings, financial condition, cash requirements, future prospects and other factors that our Board of Directors deems relevant to its analysis and decision making.

4 unchanged sentences

As part of these transactions, we guarantee that third parties will make contractual payments or achieve performance measures.

As of June 30, 2023 and December 31, 2022, we had no material third-party guarantees recorded on our condensed consolidated balance sheet.

As of September 30, 2023 and December 31, 2022, we had no material third-party guarantees recorded on our condensed consolidated balance sheet.

Guarantees do not have, and we do not expect them to have, a material effect on our liquidity.

1 unchanged sentence

As such, we may issue commercial paper or secure other forms of financing throughout the year to meet short-term working capital or other financing needs.

At its July 2022 meeting, the Board of Directors approved a new $2 billion long-term financing authorization that replaced the prior long-term financing authorization of $7 billion.

As of June 30, 2023, $1.5 billion of the long-term financing authorization remained available.

Our total debt was $21.2 billion at June 30, 2023 and $22.9 billion at December 31, 2022.

Our debt-to-capitalization ratio was 0.43 at June 30, 2023 and 0.46 at December 31, 2022.

At June 30, 2023, the weighted-average term of our outstanding long-term debt was 8.3 years.

Our average daily commercial paper borrowings outstanding were $3 billion in the first six months of 2023 and $1.2 billion in the first six months of 2022.

At the July 2022 meeting, the Board of Directors approved a new $2 billion long-term financing authorization that replaced the prior long-term financing authorization of $7 billion.

As of September 30, 2023, $1.5 billion of the long-term financing authorization remained available.

Our total debt was $20.0 billion as of September 30, 2023 and $22.9 billion as of December 31, 2022.

Our debt-to-capitalization ratio was 0.41 at September 30, 2023 and 0.46 at December 31, 2022.

At September 30, 2023, the weighted-average term of our outstanding long-term debt was 8.0 years.

Our average daily commercial paper borrowings outstanding were $2.7 billion in the first nine months of 2023 and $1.4 billion in the first nine months of 2022.

One of our subsidiaries, Mondelez International Holdings Netherlands B.V.

(“MIHN”), has outstanding debt.

The operations held by MIHN generated approximately 71.2% (or $12.6 billion) of the $17.7 billion of consolidated net revenue in the six months ended June 30, 2023.

The operations held by MIHN represented approximately 83.6% (or $24.0 billion) of the $28.7 billion of net assets as of June 30, 2023.

The operations held by MIHN generated approximately 71.5% (or $19.1 billion) of the $26.7 billion of consolidated net revenue in the nine months ended September 30, 2023.

The operations held by MIHN represented approximately 82.9% (or $23.7 billion) of the $28.6 billion of net assets as of September 30, 2023.

Refer to Note 8, Debt and Borrowing Arrangements, for more information on our debt and debt covenants.

1 unchanged sentence

We regularly monitor worldwide supply, commodity cost and currency trends so we can cost-effectively secure ingredients, packaging and fuel required for production.

During the first six months of 2023, the primary drivers of the increase in our aggregate commodity costs were higher energy, dairy, sugar, grains, edible oils, packaging, cocoa, nuts and other ingredient costs, as well as unfavorable year-over-year currency exchange transaction costs on imported materials.

A number of external factors such as the current macroeconomic environment, including global inflation, effects of the war in Ukraine, climate and weather conditions, commodity, transportation and labor market conditions, currency fluctuations and the effects of governmental agricultural or other programs affect the cost and availability of raw materials and agricultural materials used in our products.

During the first nine months of 2023, the primary drivers of the increase in our aggregate commodity costs were higher energy, sugar, dairy, grains, packaging, edible oils, cocoa, and other ingredient costs, as well as unfavorable year-over-year currency exchange transaction costs on imported materials.

materials and agricultural materials used in our products.

We address higher commodity costs and currency impacts primarily through hedging, higher pricing and manufacturing and overhead cost control.

We use hedging techniques

to limit the impact of fluctuations in the cost of our principal raw materials;

We use hedging techniques to limit the impact of fluctuations in the cost of our principal raw materials;

however, we may not be able to fully hedge against commodity cost changes, such as dairy, where there is a limited ability to hedge, and our hedging strategies may not protect us from increases in specific raw material costs.

Due to competitive or market conditions, planned trade or promotional incentives, fluctuations in currency exchange rates or other factors, our pricing actions may also lag commodity cost changes temporarily.

As a result of international supply chain, transportation and labor market disruptions and generally higher commodity, transportation and labor costs in the first six months of 2023, we expect price volatility and a higher aggregate cost environment to continue.

As a result of international supply chain, transportation and labor market disruptions and generally higher commodity, transportation and labor costs in the first nine months of 2023, we expect price volatility and a higher aggregate cost environment to continue.

While the costs of our principal raw materials fluctuate, we believe there will continue to be an adequate supply of the raw materials we use and that they will generally remain available.

19 unchanged sentences

• weakness in macroeconomic conditions in our markets, including as a result of inflation (and related monetary policy actions by governments in response to inflation), instability of certain financial institutions, volatility of commodity and other input costs and availability of commodities;

• geopolitical uncertainty, including the impact of ongoing or new developments in the war in Ukraine, related current and future sanctions imposed by governments and other authorities and related impacts, including on our business operations, employees, reputation, brands, financial condition and results of operations;

• global or regional health pandemics or epidemics;

• geopolitical uncertainty, including the impact of ongoing or new developments in Ukraine and the Middle East, related current and future sanctions imposed by governments and other authorities and related impacts, including on our business operations, employees, reputation, brands, financial condition and results of operations;

• competition and our response to channel shifts and pricing and other competitive pressures;

6 unchanged sentences

• unanticipated disruptions to our business, such as malware incidents, cyberattacks or other security breaches, and supply, commodity, labor and transportation constraints;

• our ability to identify, complete, manage and realize the full extent of the benefits, cost savings or synergies presented by strategic transactions, including our recently completed acquisitions of Ricolino, Clif Bar, Chipita, Gourmet Food, Grenade and Hu, and the anticipated closing of our planned divestiture of our developed market gum business in North America and Europe;

• our investments and our ownership interests in those investments, including JDE Peet's;

2 unchanged sentences

• the impact of climate change on our supply chain and operations;

• global or regional health pandemics or epidemics;

• consolidation of retail customers and competition with retailer and other economy brands;

31 unchanged sentences

GAAP financial measure) excluding the impacts of acquisitions, divestitures (2) and currency rate fluctuations (3) .

We believe that

Organic net revenue reflects the underlying growth from the ongoing activities of our business and provides improved comparability of results.

We believe that Organic net revenue reflects the underlying growth from the ongoing activities of our business and provides improved comparability of results.

We also evaluate Organic Net Revenue growth from emerging markets and developed markets, and these underlying measures are also reconciled to U.S.

44 unchanged sentences

We exclude these items to better facilitate comparisons of our underlying operating performance across periods.

(7) Acquisition integration costs and contingent consideration adjustments include one-time costs related to the integration of acquisitions as well as any adjustments made to the fair market value of contingent compensation liabilities that have been previously booked for earn-outs related to acquisitions that do not relate to employee compensation expense.

previously booked for earn-outs related to acquisitions that do not relate to employee compensation expense.

We exclude these items to better facilitate comparisons of our underlying operating performance across periods.

44 unchanged sentences

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis