REALTY INCOME CORP 10-Q

Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q , including the documents incorporated by reference, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. When used in this quarterly report, the words “estimate,” “anticipate,” “assume,” “expect,” “believe,” “intend,” “continue,” “should,” “may,” “likely,” “plan,” “seek,” and similar expressions are intended to identify forward-looking statements. Forward- looking statements include discussions of our business, strategy, plans, and the intentions of management; joint ventures, partnerships, and portfolio including management thereof; our platform; growth and capital strategies including our private capital business, investment pipeline and intentions to acquire or dispose of properties (including geographies, timing, partners, clients and terms); re-leases, re-development and speculative development of properties and expenditures related thereto; operations and results; our share repurchase program; settlement of shares of common stock sold pursuant to forward sale confirmations under our At-the-Market (“ATM”) program; dividends, including the amount, timing and payments of dividends; and macroeconomic and other business trends, including interest rates and trends in the market for long-term leases of freestanding, single-client properties. Forward-looking statements are subject to risks, uncertainties, and assumptions about us which may cause our actual future results to differ materially from expected results. Some of the factors that could cause actual results to differ materially are, among others, our continued qualification as a real estate investment trust; general domestic and foreign business, economic, or financial conditions; competition; fluctuating interest and currency rates; inflation and its impact on our clients and us; access to debt and equity capital markets and other sources of funding (including the terms, structure and partners of such funding); volatility and uncertainty in the credit and financial markets; other risks inherent in real estate, private capital, credit and mezzanine investments, and joint ventures or co-investment ventures, including solvency, defaults under leases, bankruptcies, potential liability relating to environmental matters, illiquidity of real estate investments (including rights of first refusal or rights of first offer), and potential damages from natural disasters; impairments in the value of our real estate assets; volatility and changes in domestic and foreign laws and the application, enforcement or interpretation thereof (including with respect to tax laws and rates); property ownership through co-investment ventures, funds, joint ventures, partnerships and other arrangements which, among other things, may transfer or limit our control of the underlying investments; epidemics or pandemics; the loss of key personnel; the threat and outcome of any legal proceedings to which we are a party or which may occur in the future; acts of terrorism and war; and the anticipated benefits from mergers, acquisitions, co-investment ventures, funds, joint ventures, partnerships and other arrangements . Additional factors that may cause risks and uncertainties include those discussed in the sections entitled “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our annual report on Form 10-K , for the year ended December 31, 2025 . Readers are cautioned not to place undue reliance on forward-looking statements. These forward-looking statements are not guarantees of future plans and performance and speak only as of the date this quarterly report was filed with the Securities and Exchange Commission (the "SEC"). Past operating results and performance are provided for informational purposes and are not a guarantee of future results. There can be no assurance that historical trends will continue. Actual plans and results may differ materially from what is expressed or forecasted in this quarterly report and forecasts made in the forward-looking statements discussed in this quarterly report might not materialize. We do not undertake any obligation to update forward-looking statements or publicly release the results of any forward-looking statements that may be made to reflect events or circumstances after the date these statements were made or to reflect the occurrence of unanticipated events. OVERVIEW Realty Income (NYSE: O), an S&P 500 company, is real estate partner to the world's leading companies ® . Founded in 1969, we serve our clients as a full-service real estate capital provider. As of June 30, 2026 , we have a portfolio of over 15,500 properties in all 50 states of the United States ("U.S."), the United Kingdom ("U.K."), and eight other countries in Europe . We are known as “The Monthly Dividend Company ® ” and have a mission to invest in people and places to deliver dependable monthly dividends that increase over time. Since our founding, we have declared 673 consecutive monthly dividends and are a member of the S&P 500 Dividend Aristocrats ® index for having increased our dividend for over 31 consecutive years. -36- Table of Contents As of June 30, 2026 , we owned or held interests in 15,588 properties, with approximately 353.2 million square feet of leasable space leased to 1,798 clients doing business in 92 separate industries. Of the 15,588 properties in our portfolio as of June 30, 2026 , 15,218 , or 97.6% , were single-tenant properties, and the remaining were multi–client properties. Our total portfolio of properties as of June 30, 2026 had a weighted average remaining lease term (excluding rights to extend a lease at the option of the client) of approximately 8.6 years. Total portfolio annualized base rent (defined as our pro-rata share of contractual monthly base rent for all leases in place and exchange rates as of the balance sheet date, multiplied by 12) on our leases as of June 30, 2026 was $5.28 billion . As of June 30, 2026 , approximately 34.3% of our total portfolio annualized base rent comes from properties leased to our investment grade clients, their subsidiaries or affiliated companies. As of June 30, 2026 , our top 20 clients (based on percentage of total portfolio annualized base rent ) represented approximately 34.8% of our annualized base rent and 13 of these clients have investment grade credit ratings or are subsidiaries or affiliates of investment grade companies. Approximately 91% of our annualized retail base rent as of June 30, 2026 , is derived from our clients with a service, non-discretionary, and/or low price point component to their business. Unless otherwise specified, references to rental revenue in the Management's Discussion and Analysis of Financial Condition and Results of Operations are exclusive of reimbursements from clients for recoverable real estate taxes and operating expenses totaling $91.1 million and $87.4 million for the three months ended June 30, 2026 and 2025 , respectively, and $188.6 million and $174.8 million for the six months ended June 30, 2026 and 2025 , respectively. RECENT DEVELOPMENTS Increases in Monthly Dividends to Common Stockholders We have continued our 57 -year history of paying monthly dividends by increasing the dividend three times during 2026 . As of August 2026 , we have paid 115 consecutive quarterly dividend increases and increased the dividend 135 times since our listing on the New York Stock Exchange (“NYSE”) in 1994. 2026 Dividend increases Month Declared Month Paid Monthly Dividend per share Increase per share 1st increase Dec 2025 Jan 2026 $ 0.2700 $ 0.0005 2nd increase Mar 2026 Apr 2026 $ 0.2705 $ 0.0005 3rd increase Jun 2026 Jul 2026 $ 0.2710 $ 0.0005 The dividends paid per share during the six months ended June 30, 2026 totaled $1.6215 , as compared to $1.6015 during the six months ended June 30, 2025 , an increase of $0.020 , or 1.2% . The monthly dividend of $0.2710 per share represents a current annualized dividend of $3.252 per share, and an annualized dividend yield of 5.2% based on the last reported sale price of our common stock on the NYSE of $61.96 on June 30, 2026 . Although we expect to continue our policy of paying monthly dividends, we cannot guarantee that we will maintain our current level of dividends, that we will continue our pattern of increasing dividends per share, or what our actual dividend yield will be in any future period. Investments During the three months ended June 30, 2026 , we invested $2.6 billion ; our pro-rata share was $2.1 billion at an initial weighted average cash yield of 7.3% , including investments in 144 properties, properties under development or expansion, unconsolidated entities, and loans. During the six months ended June 30, 2026 , we invested $5.3 billion ; our pro-rata share was $4.7 billion at an initial weighted average cash yield of 7.2% , including investments in 338 properties, properties under development or expansion, unconsolidated entities, and loans. See notes 3 , Investments in Real Estate, 4, Investments in Unconsolidated Entities, and 5 , Investments in Loans and Financing Receivables to the consolidated financial statements for further details. Establishment of Joint Venture with Cloud Capital In June 2026, we announced a strategic joint venture with Cloud Capital and its affiliates (“Cloud Capital”) to invest in hyperscale data centers, which we expect to invest up to $1.4 billion for a 45% stake in a three-asset Northern Virginia portfolio valued at more than $6.0 billion, with leases running 15 to 20 years. Subsequent to June 30, 2026, we closed on the first stabilized data center asset and expect to acquire the following two development assets upon stabilization. -37- Table of Contents Establishment of Joint Venture with Apollo In March 2026, we established our Managed Insurance and Retirement Annuity investment platform as a vehicle to pursue various co-investment opportunities with institutional investors. In connection with this initiative, on March 31, 2026 we closed a $1.0 billion strategic investment from Apollo in exchange for a 49% interest in a newly formed joint venture which owns an existing portfolio of 492 retail properties contributed by the C ompany. Dispositions During the three months ended June 30, 2026 , we sold 80 properties with total net proceeds received of $160.7 million . During the six months ended June 30, 2026 , we sold 177 properties with total net proceeds received of $348.6 million . Equity Capital Raising During the three months ended June 30, 2026 , we raised $843.0 million of proceeds from the sale of com mon stock, at a weighted average of $61.52 , primarily through the settlement of 13.7 million shares of common stock under our ATM program. As of August 5, 2026 , we had outstanding forward sale agreements under our ATM program for a total of 22.5 million shares of common stock, representing expected net proceeds of approximately $1.3 billion , of which 1.4 million shares were sold in July 2026 (assuming full physical settlement of such agreements). Note Issuance In July 2026, we issued €600.0 million of 3.625% senior unsecured notes due July 2032 . See note 19, Subsequent Events , to the consolidated financial statements for further details. In April 2026, we issued $800.0 million of 4.750% senior unsecured notes due April 2033 . In connection with the offering, we executed a $500 million U.S. Dollar-to-Euro 7-year cross currency swap, resulting in approximately €436 million of proceeds and a blended coupon rate of 4.16% . Term Loan Issuance In March 2026, we closed a $693.9 million unsecured term loan due January 2036 at a fixed rate of 4.91% and executed a cross-currency swap on $500.0 million of proceeds for approximately €431.0 million , achieving an effective blended borrowing rate of 4.34% . Convertible Bond Issuance In January 2026, we issued $862.5 million principal amount of 3.500% convertible senior notes due January 2029 in a private offering, resulting in net proceeds of approximately $845.1 million . We used approximately $101.9 million of the net proceeds to repurchase approximately 1.8 million shares of our common stock concurrently with the pricing of the offering. Expanded Revolving Credit Facilities and Commercial Paper Programs In July 2026, we closed on the recast and expansion of our $5.5 billion multicurrency unsecured revolving credit facilities, upsized from the prior $4.0 billion capacity. In addition, we also announced an expanded combined capacity of $5.5 billion for our global commercial paper programs, upsized from the prior $3.0 billion combined capacity. -38- Table of Contents Portfolio Discussion Leasing Results As of June 30, 2026 , we had 188 properties available for lease or sale out of 15,588 properties in our portfolio, which represents a 98.8% occupancy rate based on the number of properties in our portfolio. Our property-level occupancy rates exclude properties with ancillary leases only, such as cell towers and billboards, and properties with possession pending, and include properties owned by unconsolidated joint ventures. Below is a summary of our portfolio activity for the periods indicated below: Three months ended June 30, 2026 Properties available for lease as of March 31, 2026 172 Lease expirations (1) 480 Re-leases to same client (385) Re-leases to new client (34) Vacant dispositions (45) Properties available for lease as of June 30, 2026 188 Six months ended June 30, 2026 Properties available for lease as of December 31, 2025 173 Lease expirations (1) 800 Re-leases to same client (605) Re-leases to new client (57) Vacant dispositions (123) Properties available for lease as of June 30, 2026 188 (1) Includes scheduled and unscheduled expirations (including leases rejected in bankruptcy), as well as future expirations resolved in the periods indicated above. During the three months ended June 30, 2026 , the new annualized base rent on re-leased units was $110.3 million , as compared to the previous annual rent of $107.4 million on the same units, representing a rent recapture rate of 102.7% on the re-leased units. During the six months ended June 30, 2026 , the new annualized base rent on re-leased units was $183.5 million , as compared to the previous annual rent of $178.2 million on the same units, representing a rent recapture rate of 103.0% on the re-leased units. As part of our re-leasing costs, we pay leasing commissions to unrelated, third-party real estate brokers consistent with the commercial real estate industry standard, and sometimes provide rent concessions to our clients. We do not consider the collective impact of the leasing commissions or rent concessions to our clients to be material to our financial position or results of operations. Impact of Inflation Leases generally provide for limited increases in rent as a result of fixed increases, increases in the consumer price index, retail price index in the case of certain leases in the U.K. (typically subject to ceilings), or increases in clients’ sales volumes. We expect that inflation will cause these lease provisions to result in rent increases over time. During times when inflation is greater than increases in rent, as provided for in the leases, rent increases may not keep up with the rate of inflation and other costs. Moreover, our strategic focus on the use of net lease agreements reduces our exposure to rising property expenses due to inflation because the client is responsible for property expenses. Even though the utilization of net leases reduces our exposure to rising property expenses due to inflation, substantial inflationary pressures and increased costs may have an adverse impact on our clients if increases in their operating expenses exceed increases in revenue, which may adversely affect our clients' ability to pay rent. Additionally, inflationary periods may cause us to experience increased costs of financing, make it difficult to refinance debt at attractive rates or at all, and may adversely affect the properties we can acquire if the cost of financing an acquisition is in excess of our anticipated earnings from such property, thereby limiting the properties that can be acquired. -39- Table of Contents Impact of Real Estate and Capital Markets In the commercial real estate market, property prices generally continue to fluctuate. Likewise, during certain periods, the global capital markets have experienced significant price volatility, dislocations, and liquidity disruptions, which may impact our access to and cost of capital. We continually monitor the commercial real estate and global capital markets carefully and, if required, will make decisions to adjust our business strategy accordingly. Impact of Current Macroeconomic Conditions We monitor developments related to macroeconomic factors that could have an adverse impact on our business and our clients. Our clients face challenges that may differ from or be additional to challenges we face, including potential changes in consumer confidence levels, behavior and spending and increased operational expenses, including potential impacts from changes in global trade policies. The extent of the future effects on our business, results of operations, cash flows, and growth strategies is highly uncertain and will ultimately depend on future developments, none of which can be predicted. LIQUIDITY AND CAPITAL RESOURCES Our primary cash obligations are included in the “Material Cash Requirements” table, which is presented later in this section. We expect to fund our operating expenses and other short-term liquidity requirements, including property acquisitions and development costs, payment of principal and interest on our outstanding indebtedness, property improvements, re-leasing costs, and cash distributions to common stockholders, primarily through a combination of the following: • Cash and cash equivalents; • Future cash flows from operations; • Issuances of common stock or debt, or other securities offerings; • Additional borrowings under our credit facilities or commercial paper programs, which are backstopped by our credit facilities; • Short-term loans; • Asset dispositions; and • Credit investment repayments. In addition to these sources of liquidity, we manage and own an interest in our perpetual life U.S. Core Plus Fund (the "Fund"). During the six months ended June 30, 2026 , within our Fund, we called an aggregate $948.0 million of capital from third-party investors and redeemed an aggregate $591.9 million of the Company's units, resulting in our indirect ownership interest of 26.8% in the Fund. On July 1, 2026 , within our Fund, we called an additional $265.7 million of capital from third-party investors, resulting in our indirect ownership interest of 23.6% in the Fund. We seek to hold additional closings during the life of the Fund. In January 2026, we established a strategic relationship with GIC, a leading global institutional investor, including the formation of a build-to-suit development joint venture. In March 2026, we established a strategic relationship with Apollo, a high-growth, global alternative asset manager, and closed on $1.0 billion of gross proceeds in exchange for Apollo’s acquisition of a 49% interest in a joint venture that indirectly owns a diversified net lease portfolio comprised entirely of single-tenant retail properties. We intend to evaluate other opportunities to raise private capital in the future, including potentially through additional funds and/or joint venture opportunities. We believe that our cash and cash equivalents on hand, cash provided from operating activities, and borrowing capacity are sufficient to meet our liquidity needs for the next twelve months. We intend, however, to use permanent or long-term capital to fund property acquisitions and to repay future borrowings under our credit facilities and commercial paper programs. Long-Term Liquidity Requirements Our primary goal is to deliver dependable monthly dividends to stockholders that increase over time. Historically, we have met our principal short-term and long-term capital needs, including the funding of high-quality real estate acquisitions, investments in loans to clients, property development, and capital expenditures by issuing common stock, long-term unsecured notes, and term loan borrowings. While the issuance of common stock has historically been an important component of our capital structure, we continue to broaden and diversify our sources of capital to reduce reliance on the public capital markets. This approach enhances capital availability across market cycles, improves cost‑of‑capital certainty, and increases financial flexibility. However, there can be no assurance that our efforts will be successful. -40- Table of Contents Capitalization As of June 30, 2026 , our total capitalization was $90.0 billion . Total capitalization consisted of $58.8 billion of common equity (based on the June 30, 2026 closing price on the NYSE of $61.96 and assuming the conversion of 2.7 million common units of Realty Income, L.P.), and total outstanding borrowings of $31.2 billion of our pro-rata share of total debt principal. Share Repurchase Program We are authorized to repurchase up to $2.0 billion in shares of our common stock under our share repurchase program, which will expire in January 2028. Repurchases under the repurchase program may be made at management’s discretion from time to time using a variety of methods, which may include open market purchases, privately negotiated transactions, Rule 10b5-1 plans or otherwise, all in accordance with the rules of the SEC and other applicable legal requirements. The repurchase program does not obligate us to acquire any particular amount of common stock, and the repurchase program may be suspended or discontinued at any time at our discretion. In January 2026, we repurchased 1.8 million shares of our common stock for $101.9 million under the repurchase program. ATM Program During the three and six months ended June 30, 2026 , we settled approximately 13.7 million shares of common stock previously sold pursuant to forward sale agreements through our ATM program for approximately $824.3 million of net proceeds. As of June 30, 2026 , we had outstanding forward-sale agreements under our ATM program for a total of 21.1 million shares of common stock, representing approximately $1.2 billion in expected net proceeds, which have been executed at a weighted average price of $58.34 per share (assuming full physical settlement of all outstanding shares of common stock, subject to such forward sale agreements and certain assumptions made with respect to settlement dates). In May 2026, we entered into a new ATM equity program that provides for the offer and sale of up to 150.0 million shares of common stock pursuant to forward sale agreements. A s of June 30, 2026 , we had 138.9 million shares remaining for future issuance under our ATM program. We anticipate maintaining the availability of our ATM program in the future, including the replenishment of authorized shares issuable thereunder. Debt Financing Activities As of June 30, 2026 , our total outstanding borrowings of credit facilities, commercial paper, term loans, mortgages payable, and senior unsecured notes and bonds were $31.0 billion , with a weighted average maturity of 5.1 years and a weighted average interest rate of 3.9% . As of June 30, 2026 , approximately 91% of our total debt was fixed rate debt. See notes 6 through 8 to the consolidated financial statements for additional information about our outstanding debt, along with our debt financing activities during the six months ended June 30, 2026 below. Term Loan Issuance In March 2026, we closed a $693.9 million unsecured term loan due January 2036 with an affiliate of The Goldman Sachs Group, Inc. at a fixed rate of 4.91% and executed a cross-currency swap on $500.0 million of proceeds for approximately €431.0 million , achieving an effective blended borrowing rate of 4.34% . Convertible Bond Issuance In January 2026, we issued $862.5 million principal amount of 3.500% convertible senior notes due January 2029 in a private offering, resulting in net proceeds of approximately $845.1 million . We used approximately $101.9 million of the net proceeds to repurchase approximately 1.8 million shares of our common stock concurrently with the pricing of the offering. The notes are senior, unsecured obligations of Realty Income and accrue interest at a rate of 3.500% per annum, payable semi-annually in arrears. The notes will mature on January 15, 2029, unless earlier repurchased, redeemed or converted. Note Issuance In July 2026, we issued €600.0 million of 3.625% senior un secured notes due July 2032 . See note 19, Subsequent Events , to the consolidated financial statements for further details. In April 2026, we issued $800.0 million of 4.750% senior unsecured notes due April 2033 . In connection with the offering, we executed a $500 million U.S. Dollar-to-Euro 7-year cross currency swap, resulting in approximately €436 million of proceeds and a blended coupon rate of 4.16% . -41- Table of Contents Note Repayments During the six months ended June 30, 2026 , we repaid the following notes, plus accrued and unpaid interest, upon maturity: 2026 Repayments Date of Issuance Maturity Date Principal amount (in millions) 5.050% Notes January 2023 January 2026 $ 500.0 0.750% Notes December 2020 March 2026 $ 325.0 4.875% Notes June 2016 June 2026 $ 600.0 Credit Facilities and Commercial Paper Programs On July 10, 2026, we amended and restated our unsecured revolving credit facility to increase the borrowing capacity to $5.5 billion , among other things. The revolving credit facility is bifurcated into two $2.75 billion tranches, which initially mature on April 29, 2029 and July 10, 2030, respectively, before giving effect to two six -month extension options. Pursuant to the terms of the revolving credit facility, the credit ratings at the time of the amendment provided for a borrowing rate of 67.5 basis points over the SOFR for USD borrowings, with a facility commitment fee of 12.5 basis points, for all-in drawn pricing of 80 basis points over SOFR, a reduction of 5.0 basis points from the prior revolving credit facilities. In conjunction with the closing of the updated revolving credit facility, we also expanded our global unsecured commercial paper programs to a total combined capacity of $5.5 billion , including an upsized $2.75 billion U.S. commercial paper program and a $2.75 billion European commercial paper program. The notes will be sold under customary terms in the United States and European commercial paper note markets, respectively, and will rank pari passu with all of our other unsecured senior indebtedness, including our outstanding senior notes and borrowings under our multicurrency revolving credit facilities. We expect to use our $5.5 billion multicurrency revolving credit facilities as a liquidity backstop for the repayment of notes issued under the programs. Note Covenants The following is a summary of the key financial covenants for our senior unsecured notes, as defined and calculated per the terms of our senior notes and bonds. These calculations, which are not based on accounting principles generally accepted in the United States of America ("U.S. GAAP"), are presented to investors to show our ability to incur additional debt under the terms of our senior notes and bonds as well as to disclose our current compliance with such covenants and are not measures of our liquidity or performance. The actual amounts as of June 30, 2026 , are: Note Covenants Required Actual Limitation on incurrence of total debt < 60% of adjusted assets 41.5% Limitation on incurrence of secured debt < 40% of adjusted assets 0.2% Debt service and fixed charge coverage (trailing 12 months) (1) > 1.5x 4.7x Maintenance of total unencumbered assets > 150% of unsecured debt 242.2% (1) Our debt service coverage ratio is calculated on a pro forma basis for the preceding four-quarter period on the assumptions that: (i) the incurrence of any Debt (as defined in the covenants) by us since the first day of such four-quarter period and the application of the proceeds therefrom (including to refinance other Debt since the first day of such four-quarter period), (ii) the repayment or retirement of any of our Debt since the first day of such four-quarter period, and (iii) any acquisition or disposition by us of any asset or group since the first day of such four quarters and subject to certain additional adjustments. Such pro forma ratio has been prepared on the basis required by that debt service covenant, reflects various estimates and assumptions and is subject to other uncertainties, and therefore does not purport to reflect what our actual debt service coverage ratio would have been had transactions referred to in clauses (i), (ii) and (iii) of the preceding sentence occurred as of the first day of the four-quarter period, nor does it purport to reflect our debt service coverage ratio for any future period. Fixed charge coverage is calculated in the same manner as the debt service coverage. The following is our calculation of debt service and fixed charge coverage as of June 30, 2026 (in thousands, for trailing twelve months): Net income attributable to the Company $ 1,267,577 Plus: interest expense, excluding the amortization of deferred financing costs 1,152,933 Plus: provision for taxes 97,628 Plus: depreciation and amortization 2,542,368 Plus: provisions for impairment 402,094 Plus: pro forma adjustments 265,422 Less: provisions for gains from sales or joint ventures (190,441) Income available for debt service, as defined $ 5,537,581 Total pro forma debt service charge $ 1,173,688 Debt service and fixed charge coverage ratio 4.7 x -42- Table of Contents Credit Agency Ratings The borrowing interest rates under our revolving credit facilities are based upon our ratings assigned by credit rating agencies. We are currently assigned the following investment grade corporate credit ratings on our senior unsecured notes and bonds: Moody’s Investors Service has assigned a rating of A3 with a “stable” outlook, Standard & Poor’s Ratings Group has assigned a rating of A- with a “stable” outlook, and on August 3, 2026, we received a credit rating of A with a "stable" outlook from Fitch Ratings. In addition, we are assigned the following ratings on our commercial paper: Moody's Investors Service has assigned a rating of P-2, Standard & Poor's Ratings Group has assigned a rating of A-2, and Fitch Ratings has assigned a rating of F1 . Effective September 1, 2026, our current investment grade ratings provide for a borrowing rate of 0.650% over the SOFR for USD borrowings, with a facility commitment fee of 0.100%, for all-in drawn pricing of 75 basis points over SOFR. Prior to the credit rating by Fitch Ratings, financing under the credit facility was 5 basis points higher. In addition, if our credit rating is lower than BBB-/Baa3 or our senior unsecured debt is unrated, credit ratings provide for a borrowing rate 1.350% over the SOFR for USD borrowings, with a facility fee of 0.300%. If our credit rating is A/A2 or higher, credit ratings provide for a borrowing rate of 0.6250% over the SOFR for USD borrowings, with a facility fee of 0.100%. We also issue senior debt securities from time to time and our credit ratings can impact the interest rates charged in those transactions. If our credit ratings or ratings outlook change, our cost to obtain debt financing could increase or decrease. The credit ratings assigned to us could change based upon, among other things, our results of operations and financial condition. These ratings are subject to ongoing evaluation by credit rating agencies, and we cannot assure you that our ratings will not be changed or withdrawn by a rating agency in the future if, in its judgment, circumstances warrant. Moreover, a rating is not a recommendation to buy, sell or hold our debt securities or common stock. Material Cash Requirements The following table summarizes the maturity of each of our obligations as of June 30, 2026 (in millions): 2026 2027 2028 2029 2030 Thereafter Total Credit Facilities (1) $ — $ 1,039.7 $ — $ 281.5 $ — $ — $ 1,321.2 Commercial Paper (2) 1,441.4 — — — — — 1,441.4 Unsecured Term Loans — 500.0 1,571.9 — 4.1 698.9 2,774.9 Mortgages Payable 11.1 22.3 1.3 1.3 1.0 — 37.0 Senior Unsecured Notes and Bonds 950.0 2,360.7 2,499.8 3,675.3 2,442.5 13,487.8 25,416.1 Interest (3) 640.2 1,071.3 891.4 807.9 664.4 3,138.3 7,213.5 Ground Leases Paid by the Company (4) 6.2 13.7 11.5 12.8 13.4 569.3 626.9 Ground Leases Paid by Our Clients (5) 15.6 29.8 26.9 24.6 23.1 308.7 428.7 Other (6) 681.2 255.4 122.3 1.5 — 4.2 1,064.6 Total $ 3,745.7 $ 5,292.9 $ 5,125.1 $ 4,804.9 $ 3,148.5 $ 18,207.2 $ 40,324.3 (1) The initial terms of the RI Credit Facilities expire in April 2027 and April 2029 and include, at our option, two six-month extensions. The initial term of the Fund Credit Facilities expires in April 2029 and includes, at our option, two six-month extensions. (2) Commercial paper programs outstanding were $1.4 billion , maturing between July 2026 and August 2026 . (3) Interest on the commercial paper programs, term loans, mortgages payable, and senior unsecured notes and bonds has been calculated based on outstanding balances at period end through their respective maturity dates. (4) We currently pay the ground lessors directly for the rent under certain ground lease arrangements. (5) Our clients, who are generally sub-tenant clients under ground leases, are responsible for paying the rent under these ground leases. (6) “Other” consists of $729.4 million of commitments under construction contracts, $243.0 million for our equity interest in a joint venture, among other costs , $81.1 million for tenant improvements, recurring capital expenditures, and building improvements, and $11.5 million in contingent purchase consideration obligations related to leasing activities at four U.K. retail park properties acquired in 2026. A s of June 30, 2026 , we had approximately $375.4 million of unfunded loan commitments related to certain loan investments. These commitments are not reflected in the table above, as the timing of the funding is dependent on borrower request and the satisfaction of customary conditions, and therefore cannot be reasonably estimated by period. See Note 18 , Commitments and Contingencies to the consolidated financial statements for further details. Investments in Unconsolidated Entities As of June 30, 2026 , our pro-rata share of secured debt of unconsolidated entities was approximately $659.2 million . -43- Table of Contents DIVIDEND POLICY Distributions are paid monthly to holders of shares of our common stock. Distributions are paid monthly to the limited partners holding common units of Realty Income, L.P., each on a per unit basis that is equal to the amount paid per share to our common stockholders (subject to the adjustment factor applicable to those units at the time of such distribution). In order to maintain our status as a real estate investment trust ("REIT") for federal income tax purposes, we generally are required to distribute dividends to our stockholders aggregating annually at least 90% of our taxable income (excluding net capital gains), and we are subject to income tax to the extent we distribute less than 100% of our taxable income (including net capital gains) . In 2025 , our cash distributions to common stockholders totaled $2.92 billion , or approximately 159.0% of our estimated taxable income of $1.84 billion . Certain measures are available to us to reduce or eliminate our tax exposure as a REIT, and accordingly, no provision for U.S. federal income taxes, other than our taxable REIT subsidiaries (each, a "TRS"), has been made. Our estimated taxable income reflects non-cash deductions for depreciation and amortization. Our estimated taxable income is presented to show our compliance with REIT dividend requirements and is not a measure of our liquidity or operating performance. We intend to continue to make distributions to our stockholders that are sufficient to meet this dividend requirement and that will reduce or eliminate our exposure to income taxes. Furthermore, we believe our cash on hand and funds from operations are sufficient to support our current level of cash distributions to our stockholders. We distributed $1.62 per share to stockholders during the six months ended June 30, 2026 , representing 73.0% of our diluted Adjusted Funds from Operations Available to Common Stockholders ("AFFO") per share of $2.22 . Future distributions will be at the discretion of our Board of Directors and will depend on, among other things, our results of operations, Funds from Operations Available to Common Stockholders ("FFO"), Normalized Funds from Operations Available to Common Stockholders ("Normalized FFO"), AFFO, cash flow from operations, financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), our debt service requirements, and any other factors the Board of Directors may deem relevant. In addition, our RI Credit Facilities contain financial covenants that could limit the amount of distributions payable by us in the event of a default, and which prohibit the payment of distributions on our common stock in the event that we fail to pay when due (subject to any applicable grace period) any principal or interest on borrowings under our RI Credit Facilities. Distributions of our current and accumulated earnings and profits for federal income tax purposes generally will be taxable to stockholders as ordinary income, except to the extent that we recognize capital gains and declare a capital gains dividend, or that such amounts constitute “qualified dividend income” subject to a reduced rate of tax. The maximum tax rate of non-corporate taxpayers for “qualified dividend income” is generally 20%. In general, dividends payable by REITs are not eligible for the reduced tax rate on qualified dividend income, except to the extent that certain holding requirements have been met with respect to the REIT’s stock and the REIT’s dividends are attributable to dividends received from certain taxable corporations (such as our TRSs) or to income that was subject to tax at the corporate or REIT level (for example, if we distribute taxable income that we retained and paid tax on in the prior taxable year). However, non-corporate stockholders, including individuals, generally may deduct up to 20% of dividends from a REIT, other than capital gain dividends and dividends treated as qualified dividend income. Distributions in excess of earnings and profits generally will first be treated as a non-taxable reduction in the stockholders’ basis in their stock, but not below zero. Distributions in excess of that basis generally will be taxable as a capital gain to stockholders. Approximately 33.6% of the distributions to our common stockholders, made or deemed to have been made in 2025 , were classified as a return of capital for federal income tax purposes. -44- Table of Contents RESULTS OF OPERATIONS The following is a comparison of our results of operations for the three and six months ended June 30, 2026 and 2025 . Total Revenue The following summarizes our total revenue (in thousands): Three months ended June 30, Six months ended June 30, 2026 2025 Change 2026 2025 Change Rental (excluding reimbursements) $ 1,335,334 $ 1,250,764 $ 84,570 $ 2,678,666 $ 2,476,443 $ 202,223 Rental (reimbursements) 91,133 87,424 3,709 188,618 174,802 13,816 Interest income on financing receivables 32,024 32,382 (358) 64,154 65,017 (863) Interest and dividend income on loans and preferred equity investments 88,517 39,480 49,037 158,627 74,216 84,411 Other 703 328 375 6,373 405 5,968 Total revenue $ 1,547,711 $ 1,410,378 $ 137,333 $ 3,096,438 $ 2,790,883 $ 305,555 Rental Revenue (excluding reimbursements) The table below summarizes the increase in rent al revenue (excluding reimbursements) in the three and six months ended June 30, 2026 and 2025 (dollars in thousands): Three months ended June 30, Number of Properties 2026 2025 Change Properties acquired during 2026 & 2025 565 $ 113,168 $ 23,639 $ 89,529 Same store rental revenue 14,619 1,194,013 1,179,819 14,194 Constant currency adjustment (1) N/A 3,804 1,000 2,804 Properties sold during and prior to 2026 609 2,059 20,615 (18,556) Straight-line rent and other non-cash adjustments N/A (7,605) (6,397) (1,208) Vacant rents, development and other (2) 404 28,101 22,542 5,559 Other excluded revenue (3) N/A 1,794 9,546 (7,752) Total $ 1,335,334 $ 1,250,764 $ 84,570 Six months ended June 30, Number of Properties 2026 2025 Change Properties acquired during 2026 & 2025 565 $ 190,660 $ 29,533 $ 161,127 Same store rental revenue 14,619 2,384,705 2,360,352 24,353 Constant currency adjustment (1) N/A 8,619 (9,243) 17,862 Properties sold during and prior to 2026 609 8,136 43,559 (35,423) Straight-line rent and other non-cash adjustments N/A (12,023) (9,689) (2,334) Vacant rents, development and other (2) 404 56,429 50,975 5,454 Other excluded revenue (3) N/A 42,140 10,956 31,184 Total $ 2,678,666 $ 2,476,443 $ 202,223 (1) For purposes of comparability, same store rental revenue is presented on a constant currency basis using the exchange rate as of June 30, 2026 . (2) Relates to the aggregate of (i) rental revenue from 301 properties that were available for lease during part of 2026 or 2025 for the three and six months ended June 30, 2026 , respectively and (ii) rental revenue for 103 properties under development or completed developments that do not meet our same store pool definition for the three and six months ended June 30, 2026 , respectively . (3) "Other excluded revenue" primarily consists of reimbursements related to lease termination fees and other settlement income. -45- Table of Contents For purposes of determining the same store rent property pool, we include all properties that were owned for the entire year-to-date period, for both the current and prior year, except for properties during the current or prior year that: (i) were vacant at any time, (ii) were under development or redevelopment, or (iii) were involved in eminent domain and rent was reduced. Each of the exclusions from the same store pool are separately addressed within the applicable sentences above, explaining the changes in rental revenue for the period. Of the 17,440 in-place leases in the portfolio, 13,918 , or 79.8% , were under leases that provide for increases in rents through: base rent increases tied to inflation (typically subject to ceilings), percentage rent based on a percentage of the clients’ gross sales, fixed increases, or a combination of two or more of the aforementioned rent provisions. Rent based on a percentage of our clients' gross sales, or percentage rent, was $4.0 million and $2.8 million for the three months ended June 30, 2026 and 2025 , respectively. Rent based on a percentage of our clients' gross sales, or percentage rent, was $8.2 million and $8.6 million for the six months ended June 30, 2026 and 2025 , respectively. Percentage rent represents less than 1% of rental revenue. As of June 30, 2026 , our portfolio of 15,588 properties was 98.8% leased with 188 properties available for lease or sale, as compared to 98.6% leased with 212 properties available for lease as of June 30, 2025 . It has been our experience that approximately 1% to 4% of our property portfolio will be available for lease at any given time; however, it is possible that the number of properties available for lease or sale could increase in the future, given the nature of economic cycles and other unforeseen global events. Rental Revenue (reimbursements) A number of our leases provide for contractually obligated reimbursements from clients for recoverable real estate taxes and operating expenses. Contractually obligated reimbursements by our clients increased by $3.7 million and $13.8 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily due to higher reimbursable property taxes and maintenance due to growth in our portfolio. Interest Income on Financing Receivables Interest income on financing receivables decreased by $0.4 million and $0.9 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily due to lower average financing receivable balances outstanding. Interest and Dividend Income on Loans and Preferred Equity Investments Interest and dividend income on loans and preferred equity investments increased by $49.0 million and $84.4 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, due to the growth in our loan and preferred equity portfolio. Our l oans receivable and preferred equity investments increased by approximately $2.8 billion compared to the same period in 2025 due to acquisitions. Other Revenue Other revenue increased by $0.4 million and $6.0 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily due to higher solar electricity tax credits received in the first quarter of 2026. -46- Table of Contents Expenses The following summarizes our total expenses (in thousands): Three months ended June 30, Six months ended June 30, 2026 2025 Change 2026 2025 Change Depreciation and amortization $ 644,677 $ 647,849 $ (3,172) $ 1,274,952 $ 1,256,784 $ 18,168 Interest 312,083 283,824 28,259 604,023 552,198 51,825 Property (excluding reimbursements) 21,306 19,998 1,308 40,664 39,301 1,363 Property (reimbursements) 91,133 87,424 3,709 188,618 174,802 13,816 General and administrative 57,605 49,329 8,276 116,490 93,373 23,117 Provisions for impairment of real estate 54,185 142,255 (88,070) 144,350 239,673 (95,323) Provisions for credit losses on loans and financing receivables 7,258 1,108 6,150 46,361 20,279 26,082 Merger, transaction, and other costs, net 2,058 331 1,727 12,845 610 12,235 Total expenses $ 1,190,305 $ 1,232,118 $ (41,813) $ 2,428,303 $ 2,377,020 $ 51,283 Total revenue (1) $ 1,456,578 $ 1,322,954 $ 2,907,820 $ 2,616,081 General and administrative expenses as a percentage of total revenue (1) 4.0 % 3.7 % 4.0 % 3.6 % Property expenses (excluding reimbursements) as a percentage of total revenue (1) 1.5 % 1.5 % 1.4 % 1.5 % (1) Excludes client reimbursements. Depreciation and Amortization Depreciation and amortization decreased by $3.2 million for the three months ended June 30, 2026 and increased by $18.2 million for the six months ended June 30, 2026 as compared to the same periods in 2025 , as a result of accelerated amortization of in-place leases in the prior year period relating to certain properties leased to clients in bankruptcy, partially offset by higher depreciation expense due to growth in our portfolio for the three and six months ended June 30, 2026 , respectively. Interest Expense The following is a summary of the components of our interest expense (in thousands): Three months ended June 30, Six months ended June 30, 2026 2025 Change 2026 2025 Change Interest on our revolving credit facilities, commercial paper, term loans, mortgages, senior unsecured notes and bonds, and interest rate swaps $ 296,836 $ 279,407 $ 17,429 $ 576,118 $ 546,018 $ 30,100 Credit facility commitment fees 1,644 1,508 136 3,270 2,836 434 Amortization of debt origination and deferred financing costs 9,122 7,162 1,960 17,945 13,082 4,863 Gain on interest rate swaps (1,849) (1,873) 24 (3,703) (3,778) 75 Amortization of net note and mortgage and note discounts 8,394 981 7,413 14,714 1,698 13,016 Capital lease obligation 1,198 533 665 2,415 1,057 1,358 Interest capitalized (3,262) (3,894) 632 (6,736) (8,715) 1,979 Interest expense $ 312,083 $ 283,824 $ 28,259 $ 604,023 $ 552,198 $ 51,825 Revolving credit facilities, commercial paper, term loans, mortgages and senior unsecured notes and bonds Average outstanding balances $ 30,309,546 $ 28,813,067 $ 1,496,479 $ 29,779,625 $ 28,264,598 $ 1,515,027 Weighted average interest rates 3.97 % 3.88 % 3.92 % 3.87 % -47- Table of Contents Interest expense increased by $28.3 million or 10.0% , and $51.8 million , or 9.4% , for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily due to higher average borrowings in 2026 , as well as higher amortization of mortgage and note premiums and discounts and deferred financing costs. See notes to the accompanying consolidated financial statements for additional information regarding our indebtedness. Property Expenses (excluding reimbursements) Property expenses (excluding reimbursements) consist of costs associated with properties available for lease, non- net-leased properties and general portfolio expenses and include, but are not limited to, property taxes, maintenance, insurance, utilities, property inspections and legal fees. Property expenses (excluding reimbursements) increased by $1.3 million and $1.4 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily due to higher property taxes of $5.9 million and $7.4 million, partially offset by lower repairs and maintenance costs of $3.3 million and $4.4 million. Property Expenses (reimbursements) Property expenses (reimbursements) consist of property taxes and operating costs paid on behalf of our clients. Property expenses (reimbursements) increased by $3.7 million and $13.8 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily due to higher reimbursable property taxes and maintenance due to growth in our portfolio. General and Administrative Expenses General and administrative expenses are expenditures related to the operations of our company, including employee-related costs, professional fees, and other general overhead costs associated with running our business. General and administrative expenses increased by $8.3 million and $23.1 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily due to higher employee costs as we continue to invest in our people and our platform. Provisions for Impairment of Real Estate Provisions for impairment of real estate decreased by $88.1 million and $95.3 million during the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively. The decrease is primarily due to larger impairments recorded in 2025 related to properties leased to clients in bankruptc y. Provisions for Credit Losses on Loans and Financing Receivables Provisions for credit losses increased by $6.2 million and $26.1 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively. For the six months ended June 30, 2026 , the increase is primarily due to initial expected credit losses on loans acquired during the period. For the three months ended June 30, 2026 , the increase was due to initial expected credit losses on loans acquired during the period, partially offset by favorable changes in estimated credit losses for existing loans . Merger, Transaction, and Other Costs, Net Merger, transaction, and other costs, net increased by $1.7 million and $12.2 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily due to placement fees incurred in fundraising for the Fund and certain strategic venture formation costs incurred in the current year. Gain on Sales of Real Estate The following summarizes our property dispositions (dollars in thousands): Three months ended June 30, Six months ended June 30, 2026 2025 Change 2026 2025 Change Number of properties sold 80 73 7 177 128 49 Net sales proceeds $ 160,655 $ 116,841 $ 43,814 $ 348,634 $ 209,414 $ 139,220 Gain on sales of real estate $ 38,260 $ 38,566 $ (306) $ 73,902 $ 61,103 $ 12,799 -48- Table of Contents Foreign Currency and Derivative Loss, Net We borrow in the functional currencies of the countries in which we invest. Net foreign currency gain and loss are primarily related to the remeasurement of intercompany debt from foreign subsidiaries and outstanding borrowings denominated in the local currencies we invest in. Derivative gain and loss are primarily related to mark-to-market adjustments on derivatives that do not qualify for hedge accounting and settlement of designated derivatives reclassified from Accumulated Other Comprehensive Income ("AOCI"). Foreign currency and derivative loss, net increased by $4.4 million and $18.9 million , for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily due to the impact of foreign currency fluctuations on our foreign-denominated assets and liabilities, as well as derivative instruments we executed to reduce the effect of these fluctuations. Equity in Earnings of Unconsolidated Entities Equity in earnings of unconsolidated entities decreased by $1.1 million and $2.8 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily attributable to lower income within our data center joint vent ure due to a gain on sale from an easement recorded in 2025 with no comparable gain recorded in 2026, in addition to an adjustment to straight-line rent recognized in the prior year. Other Income, Net Other income, net decreased by $0.1 million for the three months ended June 30, 2026 and increased by $7.8 million for the six months ended June 30, 2026 as compared to the same periods in 2025 , primarily due to a non- recurring insurance commutation gain realized during the first quarter of 2026. I ncome Taxes Income taxes primarily consist of international income taxes accrued or paid by us and our subsidiaries, as well as state and local taxes. The increase of $1.7 million and $12.3 million in income taxes for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, is primarily attributable to higher taxable income in the U.K. and Europe, offset with lower state franchise and income taxes in the U.S. Net Income Attributable to Noncontrolling Interests Net income attributable to noncontrolling interests increased by $24.5 million and $32.0 million for the three and six months ended June 30, 2026 as compared to the same periods in 2025 , respectively, primarily attributable to the launches of our U.S. Core Plus Fund and Apollo joint venture, which contributed to increases of $24.6 million and $32.5 million for the three and six months ended June 30, 2026 . -49- Table of Contents NON-GAAP FINANCIAL MEASURES Adjusted Earnings before Interest, Taxes, Depreciation and Amortization for Real Estate ("Adjusted EBITDA re ") Nareit established an EBITDA metric for real estate companies (i.e., EBITDA for real estate, or EBITDA re ) it believed would provide investors with a consistent measure to help make investment decisions among certain REITs. Our definition of “Adjusted EBITDA re ” is generally consistent with the Nareit definition, other than our adjustment to remove foreign currency and derivative gain and loss and merger, transaction, and other costs, net . We define Adjusted EBITDA re , a non-GAAP financial measure, for the most recent quarter as earnings (net income) before (i) interest expense, (ii) income taxes, (iii) depreciation and amortization, (iv) executive severance charge, (v) provisions for impairment of real estate, (vi) provisions for credit losses on loans and financing receivables, (vii) merger, transaction, and other costs, net, (viii) gain on sales of real estate, (ix) foreign currency and derivative gain and loss, net, and (x) equity in earnings of unconsolidated entities. Our Adjusted EBITDA re may not be comparable to Adjusted EBITDA re reported by other companies or as defined by Nareit, and other companies may interpret or define Adjusted EBITDA re differently than we do. Management believes Adjusted EBITDA re to be a meaningful measure of a REIT’s performance because it provides a view of our operating performance, analyzes our ability to meet interest payment obligations before the effects of income tax, depreciation and amortization expense, provisions for impairment, provisions for credit losses on loans and financing receivables, gain on sales of real estate and other items, as defined above, that affect comparability, including the removal of non-recurring and non- cash items that industry observers believe are less relevant to evaluating the operating performance of a company. In addition, EBITDA re is widely followed by industry analysts, lenders, investors, rating agencies, and others as a means of evaluating the operating performance of business activities prior to servicing debt obligations. Management also believes the use of an Annualized Adjusted EBITDA re metric, which is calculated by multiplying Adjusted EBITDAre for the applicable quarter by four, is meaningful because it represents our current earnings run rate for the period presented. Adjusted EBITDAre should be considered along with, but not as an alternative to net income as a measure of our operating performance. We define Annualized Pro Forma Adjusted EBITDA re as Annualized Adjusted EBITDA re , subject to certain adjustments to incorporate Adjusted EBITDA re from investments we acquired or stabilized during the applicable quarter and Adjusted EBITDA re from investments we disposed of during the applicable quarter, and include transaction accounting adjustments in accordance with U.S. GAAP, giving pro forma effect to all transactions as if they occurred at the beginning of the applicable quarter. Our calculation includes all adjustments consistent with the requirements to present Annualized Adjusted EBITDA re on a pro forma basis in accordance with Article 11 of Regulation S-X. We believe Annualized Pro Forma Adjusted EBITDA re is a useful non-GAAP supplemental measure, as it excludes investments that were no longer owned at the balance sheet date and includes the annualized base rent from investments acquired during the quarter. Management also uses our ratio of Net Debt/Annualized Pro Forma Adjusted EBITDA re as a measure of leverage in assessing our financial performance, which is calculated as net debt (which we define as total debt, excluding deferred financing costs and net discounts, less consolidated cash and cash equivalents), divided by Annualized Pro Forma Adjusted EBITDA re . The ratio of our net debt to our Annualized Pro Forma Adjusted EBITDA re is also used to determine vesting of performance share awards granted to our executive officers. -50- Table of Contents The following is a reconciliation of net income (which we believe is the most comparable U.S. GAAP measure) to Adjusted EBITDA re and Annualized Pro Forma Adjusted EBITDA re calculations for the period indicated below (dollars in thousands): Three months ended June 30, 2026 Net income $ 370,513 Interest 312,083 Income taxes 25,808 Depreciation and amortization 644,677 Executive severance charge 255 Provisions for impairment of real estate 54,185 Provisions for credit losses on loans and financing receivables 7,258 Merger, transaction, and other costs, net 2,058 Gain on sales of real estate (38,260) Foreign currency and derivative loss, net 8,824 Equity in earnings of unconsolidated entities (2,204) Adjusted EBITDA re $ 1,385,197 Annualized Adjusted EBITDA re $ 5,540,788 Annualized Pro Forma Adjustments $ 111,889 Annualized Pro Forma Adjusted EBITDA re $ 5,652,677 Total debt per the consolidated balance sheets, excluding deferred financing costs and net discounts $ 30,990,552 Less: Cash and cash equivalents (552,648) Net Debt $ 30,437,904 Net Debt/Annualized Pro Forma Adjusted EBITDA re 5.4x As described above, the Annualized Pro Forma Adjustments, which include transaction accounting adjustments in accordance with U.S. GAAP, consist of adjustments to incorporate the Adjusted EBITDA re from investments we acquired or stabilized during the applicable quarter and Adjusted EBITDA re from investments we disposed of during the applicable quarter, giving pro forma effect to all transactions as if they occurred at the beginning of the applicable quarter, consistent with the requirements of Article 11 of Regulation S-X. The following table summarizes our Annualized Pro Forma Adjustments related to our Annualized Pro Forma Adjusted EBITDA re calculation for the period indicated below (in thousands): Three months ended June 30, 2026 Annualized pro forma adjustments from investments acquired or stabilized $ 121,946 Annualized pro forma adjustments from investments disposed (10,057) Annualized Pro Forma Adjustments $ 111,889 -51- Table of Contents FUNDS FROM OPERATIONS AVAILABLE TO COMMON STOCKHOLDERS AND NORMALIZED FUNDS FROM OPERATIONS AVAILABLE TO COMMON STOCKHOLDERS We define FFO, a non-GAAP measure, consistent with the National Association of Real Estate Investment Trusts' definition, as net income available to common stockholders, plus depreciation and amortization of real estate assets, plus provisions for impairments of depreciable real estate assets, and reduced by gain on property sales. We define Normalized FFO, a non-GAAP financial measure, as FFO excluding merger, transaction, and other costs, net . We define diluted FFO and diluted normalized FFO as FFO and normalized FFO adjusted for dilutive noncontrolling interests. The following summarizes our FFO and Normalized FFO (in millions, except per share data): Three months ended June 30, Six months ended June 30, 2026 2025 % Change 2026 2025 % Change FFO available to common stockholders $ 996.6 $ 955.7 4.3 % $ 1,990.2 $ 1,893.4 5.1 % FFO per common share (1) $ 1.07 $ 1.06 0.9 % $ 2.13 $ 2.11 0.9 % Normalized FFO available to common stockholders $ 998.7 $ 956.1 4.5 % $ 2,003.0 $ 1,894.0 5.8 % Normalized FFO per common share (1) $ 1.07 $ 1.06 0.9 % $ 2.14 $ 2.11 1.4 % (1) All per share amounts are presented on a diluted per common share basis. We consider FFO and Normalized FFO to be appropriate supplemental measures of a REIT’s operating performance as they are based on a net income analysis of property portfolio performance that adds back items such as depreciation and impairments for FFO, and adds back merger, transaction, and other costs, net , for Normalized FFO. The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time. Since real estate values historically rise and fall with market conditions, presentations of operating results for a REIT, using historical accounting for depreciation, could be less informative. -52- Table of Contents The following is a reconciliation of net income available to common stockholders (which we believe is the most comparable U.S. GAAP measure) to FFO and Normalized FFO. Also presented is information regarding distributions paid to common stockholders and the weighted average number of common shares used for the basic and diluted computation per share (in thousands, except per share amounts): Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Net income available to common stockholders $ 343,955 $ 196,919 $ 655,721 $ 446,734 Depreciation and amortization 644,677 647,849 1,274,952 1,256,784 Depreciation of furniture, fixtures and equipment (802) (604) (1,589) (1,142) Provisions for impairment of real estate 54,185 142,254 144,350 239,672 Gain on sales of real estate (38,260) (38,566) (73,902) (61,103) Proportionate share of adjustments for unconsolidated entities 9,021 9,085 18,499 15,340 FFO adjustments allocable to noncontrolling interests (16,176) (1,189) (27,830) (2,882) FFO available to common stockholders $ 996,600 $ 955,748 $ 1,990,201 $ 1,893,403 FFO allocable to dilutive noncontrolling interests 2,344 2,417 4,377 4,842 Diluted FFO $ 998,944 $ 958,165 $ 1,994,578 $ 1,898,245 FFO available to common stockholders $ 996,600 $ 955,748 $ 1,990,201 $ 1,893,403 Merger, transaction, and other costs, net 2,058 331 12,845 610 Normalized FFO available to common stockholders $ 998,658 $ 956,079 $ 2,003,046 $ 1,894,013 Normalized FFO allocable to dilutive noncontrolling interests 2,344 2,417 4,377 4,842 Diluted Normalized FFO $ 1,001,002 $ 958,496 $ 2,007,423 $ 1,898,855 FFO per common share： Basic $ 1.07 $ 1.06 $ 2.14 $ 2.11 Diluted $ 1.07 $ 1.06 $ 2.13 $ 2.11 Normalized FFO per common share: Basic $ 1.07 $ 1.06 $ 2.15 $ 2.11 Diluted $ 1.07 $ 1.06 $ 2.14 $ 2.11 Distributions paid to common stockholders $ 756,779 $ 727,450 $ 1,514,811 $ 1,439,274 FFO after distributions $ 239,821 $ 228,298 $ 475,390 $ 454,129 Normalized FFO after distributions $ 241,879 $ 228,629 $ 488,235 $ 454,739 Weighted average number of common shares used for FFO and Normalized FFO: Basic 932,307 902,966 932,133 897,338 Diluted 937,344 906,398 937,117 900,797 -53- Table of Contents ADJUSTED FUNDS FROM OPERATIONS AVAILABLE TO COMMON STOCKHOLDERS We define AFFO, a non-GAAP measure, as FFO adjusted for unique revenue and expense items, which we believe are not as pertinent to the measurement of our ongoing operating performance. We define diluted AFFO as AFFO adjusted for dilutive noncontrolling interests. The following summarizes our AFFO (in millions, except per share data): Three months ended June 30, Six months ended June 30, 2026 2025 % Change 2026 2025 % Change AFFO available to common stockholders $ 1,022.1 $ 947.5 7.9 % $ 2,079.7 $ 1,897.2 9.6 % AFFO per common share (1) $ 1.09 $ 1.05 3.8 % $ 2.22 $ 2.11 5.2 % (1) All per share amounts are presented on a diluted per common share basis. We consider AFFO to be an appropriate supplemental measure of our performance. Most companies in our industry use a similar measurement, but they may use the term “CAD” (for Cash Available for Distribution), “FAD” (for Funds Available for Distribution) or other terms. Our AFFO calculations may not be comparable to AFFO, CAD or FAD reported by other companies, and other companies may interpret or define such terms differently than we do. We believe the non-GAAP financial measure AFFO provides useful information to investors because it is a widely accepted industry measure of the operating performance of real estate companies that is used by industry analysts and investors who look at and compare those companies. In particular, AFFO provides an additional measure to compare the operating performance of different REITs without having to account for differing depreciation assumptions and other unique revenue and expense items which are not pertinent to measuring a particular company’s on-going operating performance. Therefore, we believe that AFFO is an appropriate supplemental performance metric, and that the most appropriate U.S. GAAP performance metric to which AFFO should be reconciled is net income available to common stockholders. Presentation of the information regarding FFO, Normalized FFO, and AFFO is intended to assist the reader in comparing the operating performance of different REITs, although it should be noted that not all REITs calculate FFO, Normalized FFO, and AFFO in the same way, so comparisons with other REITs may not be meaningful. Furthermore, FFO, Normalized FFO, and AFFO are not necessarily indicative of cash flow available to fund cash needs and should not be considered as alternatives to net income as an indication of our performance. FFO, Normalized FFO, and AFFO should not be considered as alternatives to reviewing our cash flows from operating, investing, and financing activities. In addition, FFO, Normalized FFO, and AFFO should not be considered as measures of liquidity, our ability to make cash distributions, or our ability to pay interest payments. -54- Table of Contents The following is a reconciliation of net income available to common stockholders (which we believe is the most comparable U.S. GAAP measure) to Normalized FFO and AFFO. Also presented is information regarding distributions paid to common stockholders and the weighted average number of common shares used for the basic and diluted computation per share (in thousands, except per share amounts). Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Net income available to common stockholders $ 343,955 $ 196,919 $ 655,721 $ 446,734 Cumulative adjustments to calculate Normalized FFO (1) 654,703 759,160 1,347,325 1,447,279 Normalized FFO available to common stockholders 998,658 956,079 2,003,046 1,894,013 Debt-related non-cash items: Amortization of net debt discounts and deferred financing costs 17,696 8,257 33,074 14,890 Amortization of acquired interest rate swap value (2) 1,530 3,555 3,061 7,266 Capital expenditures from operating properties: Leasing costs and commissions (1,944) (1,985) (3,298) (2,865) Recurring capital expenditures — (221) (170) (240) Other non-cash items: Provisions for credit losses on loans and financing receivables 7,258 1,109 46,361 20,280 Amortization of share-based compensation 9,268 8,110 20,651 14,009 Straight-line rent and expenses, net (39,536) (30,226) (79,046) (74,038) Amortization of above and below-market leases, net 16,883 6,287 30,763 21,613 Deferred tax expense 281 413 1,718 309 Proportionate share of adjustments for unconsolidated entities (320) (1,678) (774) (1,641) Executive severance charge (3) 255 — 1,846 — Other adjustments (4) 12,091 (2,209) 22,441 3,611 AFFO available to common stockholders $ 1,022,120 $ 947,491 $ 2,079,673 $ 1,897,207 AFFO allocable to dilutive noncontrolling interests 2,338 2,401 4,772 4,802 Diluted AFFO $ 1,024,458 $ 949,892 $ 2,084,445 $ 1,902,009 AFFO per common share: Basic $ 1.10 $ 1.05 $ 2.23 $ 2.11 Diluted $ 1.09 $ 1.05 $ 2.22 $ 2.11 Distributions paid to common stockholders $ 756,779 $ 727,450 $ 1,514,811 $ 1,439,274 AFFO after distributions $ 265,341 $ 220,041 $ 564,862 $ 457,933 Weighted average number of common shares used for AFFO: Basic 932,307 902,966 932,133 897,338 Diluted 937,344 906,398 937,117 900,797 (1) See reconciling items for Normalized FFO presented under “Funds from Operations Available to Common Stockholders and Normalized Funds from Operations Available to Common Stockholders". (2) Includes the amortization of the purchase price allocated to interest rate swaps acquired in the merger with Spirit. (3) The executive severance charge reflects certain benefits related to our Chief Legal Officer's expected departure in September 2026. (4) Includes primarily non-cash foreign currency losses (gains) from remeasurement to USD, mark-to-market adjustments on investments and derivatives that are non-cash in nature, obligations related to financing lease liabilities, and adjustments allocable to noncontrolling interests . -55- Table of Contents PROPERTY PORTFOLIO INFORMATION As of June 30, 2026 , most of the properties in our portfolio were leased under net lease agreements. A net lease typically requires the client to be responsible for monthly rent and certain property operating expenses including property taxes, insurance, and maintenance. In addition, clients of our properties typically pay rent increases based on: (1) fixed increases, (2) increases tied to inflation (typically subject to ceilings), or (3) additional rent calculated as a percentage of the clients' gross sales above a specified level. We define total portfolio annualized base rent as our pro-rata share of contractual monthly base rent for all leases in place and exchange rates as of the balance sheet date, multiplied by 12, and excluding percentage rent and income on loans and preferred equity investments. If there is a rent abatement, we annualize the first monthly contractual base rent following the free rent period. Total annualized base rent has not been reduced to reflect reserves recorded as reductions to GAAP rental revenue in the periods presented. We believe total annualized base rent is a useful supplemental operating measure, as it excludes properties that were no longer owned at the balance sheet date and includes the annualized rent from properties acquired during the quarter. Top 20 Industry Concentrations We are engaged in a single business activity, which is the leasing of property to clients, generally on a net lease basis. That business activity spans various geographic boundaries and includes property types and clients engaged in various industries. Even though we have a single segment, we believe our investors continue to view diversification as a key component of our investment philosophy and so we believe it remains important to present certain information regarding our property portfolio classified according to the business of the respective clients, expressed as a percentage of our total portfolio annualized base rent : Percentage of Total Portfolio Annualized Base Rent by Industry As of June 30, 2026 December 31, 2025 (1) Grocery 11.1% 11.1% Convenience Stores 9.4 9.5 Home Improvement 6.4 6.4 Dollar Stores 6.0 6.1 Restaurants-Quick Service 4.8 4.8 Automotive Service 4.2 4.3 Health and Fitness 4.2 4.4 Drug Stores 4.1 4.3 General Merchandise 3.7 3.5 Restaurants-Casual Dining 3.6 3.8 Gaming 3.1 3.1 Home Furnishings 3.0 2.8 Transportation Services 3.0 2.9 Health Care 2.7 2.7 Apparel Stores 2.7 2.6 Sporting Goods 2.5 2.4 Wholesale Clubs 2.1 2.2 Motor Vehicle Dealerships 2.0 1.7 Entertainment 1.8 1.9 Theaters 1.8 1.9 (1) Annualized Base Rent percentages have been recast to conform to the current period presentation . -56- Table of Contents Property Type Composition The following table sets forth certain property type information regarding our property portfolio as of June 30, 2026 (dollars and square footage in thousands): Property Type Number of Properties Leasable Square Feet (1) Annualized Base Rent Percentage of Annualized Base Rent Retail 14,913 216,919 $ 4,132,195 78.3 % Industrial 604 127,032 856,311 16.2 Gaming 2 5,053 165,629 3.1 Other (2) 69 4,216 126,265 2.4 Total 15,588 353,220 $ 5,280,400 100.0 % (1) Represents leasable building square footage, which includes our portfolio of unconsolidated joint ventures based on ownership percentage and deducts noncontrolling interests. Excludes 2,962 acres of leased land categorized as agriculture as of June 30, 2026 . (2) "Other" primarily includes 27 properties classified as agriculture with $35.8 million in annualized base rent , 15 properties classified as office with $33.4 million in annualized base rent , 21 properties classified as country clubs with $28.0 million in annualized base rent , and three properties classified as data centers with $25.0 million in annualized base rent , as well as one land parcel under development. Client Diversification The following table sets forth the 20 largest clients in our property portfolio, expressed as a percentage of total portfolio annualized base rent , which does not give effect to deferred rent or interest earned on loans and preferred equity investments, as of June 30, 2026 : Client Number of Leases Percentage of Total Portfolio Annualized Base Rent (1) Dollar General 1,855 3.3 % 7-Eleven 802 3.1 Walgreens 391 3.0 Family Dollar 1,253 2.6 Life Time Group 43 2.1 (B&Q) Kingfisher 72 2.0 Wynn Resorts 1 2.0 EG Group 414 2.0 Asda 41 1.6 Sainsbury's 42 1.6 Tesco 30 1.5 BJ's Wholesale Club 45 1.5 Tractor Supply 258 1.4 FedEx 60 1.3 MGM (Bellagio) 1 1.1 CVS Pharmacy 206 1.1 Carrefour 43 1.0 Home Depot 41 0.9 Walmart / Sam's Club 62 0.9 Decathlon 85 0.9 Total 5,745 34.8 % (1) Amounts for each client are calculated independently; therefore, the individual percentages may not sum to the total. -57- Table of Contents Lease Expirations The following table sets forth certain information regarding the timing of the lease term expirations in our portfolio (excluding rights to extend a lease at the option of the client) and their contribution to total portfolio annualized base rent as of June 30, 2026 (dollars in thousands): Total Portfolio (1) Expiring Leases Annualized Base Rent Percentage of Annualized Base Rent Year Retail Non-Retail 2026 386 13 $ 78,172 1.5 % 2027 1,370 50 308,889 5.8 2028 1,766 73 407,284 7.7 2029 1,916 52 452,829 8.6 2030 1,345 52 371,413 7.0 2031 1,292 78 458,310 8.7 2032 1,462 55 382,140 7.2 2033 1,074 37 326,834 6.2 2034 819 41 361,023 6.8 2035 740 32 240,747 4.6 2036 701 40 276,869 5.2 2037 564 25 153,170 2.9 2038 425 24 149,872 2.8 2039 543 9 148,326 2.8 2040 415 8 163,006 3.1 2041-2143 1,897 127 1,001,516 19.1 Total 16,715 716 $ 5,280,400 100.0 % (1) Leases on our multi-tenant properties are counted separately in the table above. Geographic Diversification The following table sets forth certain geographic information regarding our property portfolio as of June 30, 2026 (square footage in thousands): Location Number of Properties Percent Leased Approximate Leasable Square Feet Percentage of Annualized Base Rent Alabama 505 100 % 6,059 1.7 % Alaska 16 94 623 0.2 Arizona 286 99 4,344 1.7 Arkansas 309 99 3,260 0.9 California 364 99 14,204 4.4 Colorado 201 100 3,714 1.3 Connecticut 57 100 2,638 0.6 Delaware 26 96 283 0.1 Florida 1,072 99 12,864 4.7 Georgia 720 99 10,866 3.3 Hawaii 22 100 48 0.1 Idaho 40 98 415 0.2 Illinois 600 100 14,554 4.2 Indiana 479 99 12,569 2.4 Iowa 121 99 4,303 0.7 Kansas 201 98 5,187 0.8 Kentucky 454 100 6,430 1.4 -58- Table of Contents Location Number of Properties Percent Leased Approximate Leasable Square Feet Percentage of Annualized Base Rent Louisiana 379 100 5,814 1.6 Maine 112 99 1,304 0.5 Maryland 101 98 4,014 1.1 Massachusetts 210 100 7,782 3.7 Michigan 584 100 8,563 2.5 Minnesota 283 97 5,468 1.5 Mississippi 338 100 5,412 1.1 Missouri 424 98 6,387 1.6 Montana 32 100 407 0.2 Nebraska 84 100 1,294 0.3 Nevada 81 100 4,699 1.8 New Hampshire 68 96 1,265 0.4 New Jersey 151 93 2,717 1.1 New Mexico 149 100 2,219 0.7 New York 376 99 6,642 2.5 North Carolina 493 98 9,900 2.5 North Dakota 26 100 595 0.2 Ohio 827 98 23,045 4.1 Oklahoma 389 100 5,466 1.5 Oregon 42 100 698 0.3 Pennsylvania 379 95 7,501 1.9 Rhode Island 35 97 415 0.2 South Carolina 385 98 5,975 1.7 South Dakota 40 98 603 0.2 Tennessee 582 100 9,717 2.3 Texas 1,826 97 34,788 9.5 Utah 55 100 2,531 0.5 Vermont 21 100 208 0.1 Virginia 418 99 8,415 2.4 Washington 86 100 2,132 0.7 West Virginia 109 100 949 0.3 Wisconsin 327 99 7,922 1.7 Wyoming 25 100 215 0.1 Puerto Rico 6 100 59 * U.S. Virgin Islands 1 100 38 * France 45 98 2,703 0.5 Germany 6 100 1,935 0.3 Ireland 24 100 2,534 0.8 Italy 88 100 4,150 1.1 Netherlands 2 100 2,915 0.5 Poland 6 100 3,834 0.6 Portugal 8 100 474 0.1 Spain 102 98 8,865 1.6 United Kingdom 390 99 38,290 15.0 Total/average 15,588 99 % 353,220 100.0 % *Less than 0.1% -59- Table of Contents IMPACT OF RECENT ACCOUNTING PRONOUNCEMENTS For information on the impact of new accounting standards on our consolidated financial statements, see note 1 , Summary of Significant Accounting Policies , to our Consolidated Financial Statements. CRITICAL ACCOUNTING POLICIES Our consolidated financial statements have been prepared in accordance with U.S. GAAP and are the basis for our discussion and analysis of financial condition and results of operations. Preparing our consolidated financial statements requires us to make a number of estimates and assumptions that affect the reported amounts and disclosures in the consolidated financial statements. We believe that we have made these estimates and assumptions in an appropriate manner and in a way that accurately reflects our financial condition. We continually test and evaluate these estimates and assumptions using our historical knowledge of the business, as well as other factors, to ensure that they are reasonable for reporting purposes. However, actual results may differ from these estimates and assumptions. There have been no material changes to the Critical Accounting Policies disclosed in our annual report on Form 10-K for the year ended December 31, 2025 . This summary should be read in conjunction with the more complete discussion of our accounting policies and procedures included in note 1 , Summary of Significant Accounting Policies , to our consolidated financial statements in our annual report.