SERVICE CORP INTERNATIONAL 10-K

Item 8. Financial Statements and Supplementary Data Index to Financial Statements and Related Schedule Page Financial Statements: Report of Independent Registered Public Accounting Firm (PCAOB ID 238 ) 41 Consolidated Statement of Operations for the years ended December 31, 2025, 2024, and 2023 43 Consolidated Statement of Comprehensive Income for the years ended December 31, 202 5 , 202 4 , and 202 3 44 Consolidated Balance Sheet as of December 31, 2025 and 2024 45 Consolidated Statement of Cash Flows for the years ended December 31, 2025, 2024, and 2023 46 Consolidated Statement of Equity for the years ended December 31, 2025, 2024, and 2023 47 Notes to Consolidated Financial Statements 48 1. Nature of Operations 48 2. Summary of Significant Accounting Policies 48 3. Preneed Activities 56 4. Goodwill and Intangible Assets 61 5. Income Taxes 62 6. Debt 66 7. Credit Risk and Fair Value of Financial Instruments 68 8. Leases 69 9. Commitments and Contingencies 72 10. Equity 72 11. Share-Based Compensation 73 12. Retirement Plans 75 13. Segment Reporting 77 14. Supplementary Information 80 15. Earnings Per Share 82 16. Acquisitions and Divestiture-Related Activities 83 Financial Statement Schedule: II — Valuation and Qualifying Accounts for the years ended December 31, 2025, 2024, and 2023 84 All other schedules have been omitted because the required information is not applicable or is not present in amounts sufficient to require submission or because the information required is included in the consolidated financial statements or the related notes thereto. 40 Service Corporation International PART II Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of Service Corporation International Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheet of Service Corporation International and its subsidiaries (the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of operations, of comprehensive income, of equity and of cash flows for each of the three years in the period ended December 31, 2025, including the related notes and financial statement schedule listed in the accompanying index (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO. Basis for Opinions The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. FORM 10-K 41 PART II Revenue Recognition – Funeral and Cemetery Merchandise and Services and Cemetery Property Interment Rights As described in Note 2 to the consolidated financial statements, for the year ended December 31, 2025, the Company earned $4.3 billion in consolidated revenue, of which the majority was derived from the delivery of funeral and cemetery merchandise and services, as well as cemetery property interment rights. Revenue is recognized when control of the merchandise or services is transferred to the customer. Control transfers when merchandise is delivered or services are performed. For cemetery property interment rights, control transfers to the customer when the property is developed and the interment right has been sold and can no longer be marketed or sold to another customer. Total consideration received for contracts with customers represents the stated amount of the contract excluding any amounts collected on behalf of third parties. The total consideration received for contracts with customers is allocated to each performance obligation based on relative selling price. Relative selling prices are determined by the amount the Company sells the performance obligation for on a stand-alone basis or their best estimate of the amount they would sell it for based on an adjusted market assessment approach that is consistent with their historical pricing practices. The principal consideration for our determination that performing procedures relating to revenue recognition is a critical audit matter is a high degree of auditor effort in performing procedures related the Company’s revenue recognition. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to Company’s funeral and cemetery merchandise and services and cemetery property interment rights. These procedures also included, among others, (i) testing, on a sample basis, revenue recognized by obtaining and inspecting source documents, such as contracts, proof of control transfer, and where applicable, cash receipts; (ii) testing, on a sample basis, cemetery property interment rights revenue transactions recorded near year end to evaluate whether they were recorded in the appropriate period; and (iii) testing the completeness of the contract listing provided by management. /s/ PricewaterhouseCoopers LLP Houston, Texas February 12, 2026 We have served as the Company’s auditor since 1993. 42 Service Corporation International PART II Service Corporation International Consolidated Statement of Operations Years Ended December 31, 2025 2024 2023 (In thousands, except per share amounts) Revenue Property and merchandise revenue $ 2,080,099 $ 2,108,009 $ 2,124,600 Service revenue 1,807,065 1,731,899 1,683,417 Other revenue 422,070 346,471 291,761 Total revenue 4,309,234 4,186,379 4,099,778 Costs of revenue Cost of property and merchandise ( 1,086,411 ) ( 1,074,412 ) ( 1,075,041 ) Cost of service ( 974,925 ) ( 940,119 ) ( 912,346 ) Overhead and other expenses ( 1,107,824 ) ( 1,081,191 ) ( 1,020,584 ) Costs of revenue ( 3,169,160 ) ( 3,095,722 ) ( 3,007,971 ) Gross profit 1,140,074 1,090,657 1,091,807 Corporate general and administrative expenses ( 166,158 ) ( 139,019 ) ( 157,368 ) Restructuring charge ( 1,980 ) ( 11,470 ) — Gains (loss) on divestitures and impairment charges, net 6,151 ( 12,488 ) 9,816 Operating income 978,087 927,680 944,255 Interest expense ( 255,372 ) ( 257,771 ) ( 239,447 ) Losses on early extinguishment of debt, net ( 523 ) ( 25 ) ( 1,114 ) Other income, net 7,591 5,534 4,912 Income before income taxes 729,783 675,418 708,606 Provision for income taxes ( 186,938 ) ( 156,665 ) ( 170,945 ) Net income 542,845 518,753 537,661 Net income attributable to noncontrolling interests ( 231 ) ( 105 ) ( 344 ) Net income attributable to common stockholders $ 542,614 $ 518,648 $ 537,317 Basic earnings per share: Net income attributable to common stockholders $ 3.83 $ 3.57 $ 3.57 Basic weighted average number of shares 141,603 145,271 150,565 Diluted earnings per share: Net income attributable to common stockholders $ 3.80 $ 3.53 $ 3.53 Diluted weighted average number of shares 142,689 146,782 152,351 (See notes to consolidated financial statements) FORM 10-K 43 PART II Service Corporation International Consolidated Statement of Comprehensive Income Years Ended December 31, 2025 2024 2023 (In thousands) Net income $ 542,845 $ 518,753 $ 537,661 Other comprehensive income: Foreign currency translation adjustments 19,648 ( 32,121 ) 8,353 Total comprehensive income 562,493 486,632 546,014 Total comprehensive income attributable to noncontrolling interests ( 233 ) ( 96 ) ( 344 ) Total comprehensive income attributable to common stockholders $ 562,260 $ 486,536 $ 545,670 (See notes to consolidated financial statements) 44 Service Corporation International PART II Service Corporation International Consolidated Balance Sheet December 31, 2025 2024 (In thousands, except share amounts) ASSETS Current assets: Cash and cash equivalents $ 243,581 $ 218,766 Receivables, net of reserves of $ 3,944 and $ 4,040 , respectively 100,415 94,341 Inventories 35,246 33,318 Other 32,551 30,905 Total current assets 411,793 377,330 Preneed receivables, net of reserves of $ 34,680 and $ 35,857 , respectively, and trust investments 7,360,793 6,739,332 Cemetery property 2,201,967 2,129,404 Property and equipment, net 2,751,761 2,581,069 Goodwill 2,169,055 2,081,015 Deferred charges and other assets, net of reserves of $ 2,460 and $ 2,367 , respectively 1,360,530 1,317,256 Cemetery perpetual care trust investments 2,398,613 2,154,032 Total assets $ 18,654,512 $ 17,379,438 LIABILITIES & EQUITY Current liabilities: Accounts payable and accrued liabilities $ 685,156 $ 639,274 Current maturities of long-term debt 56,847 83,850 Income taxes payable 3,701 715 Total current liabilities 745,704 723,839 Long-term debt 5,082,970 4,751,448 Deferred revenue, net 1,779,266 1,755,170 Deferred tax liability 691,033 649,195 Other liabilities 550,793 513,480 Deferred receipts held in trust 5,784,398 5,162,525 Care trusts’ corpus 2,381,507 2,145,112 Commitments and contingencies (Note 9) Equity: Common stock, $ 1 per share par value, 500,000,000 shares authorized, 141,957,004 and 146,668,589 shares issued, respectively, and 139,678,199 and 144,694,887 shares outstanding, respectively 139,678 144,695 Capital in excess of par value 987,210 986,830 Retained earnings 498,958 553,701 Accumulated other comprehensive income (loss) 12,425 ( 7,221 ) Total common stockholders’ equity 1,638,271 1,678,005 Noncontrolling interests 570 664 Total equity 1,638,841 1,678,669 Total liabilities and equity $ 18,654,512 $ 17,379,438 (See notes to consolidated financial statements) FORM 10-K 45 PART II Service Corporation International Consolidated Statement of Cash Flows Years Ended December 31, 2025 2024 2023 (In thousands) Cash flows from operating activities: Net income $ 542,845 $ 518,753 $ 537,661 Adjustments to reconcile net income to net cash provided by operating activities: Loss on early extinguishment of debt, net 523 25 1,114 Depreciation and amortization 219,654 208,211 191,272 Amortization of intangibles 16,370 17,222 18,736 Amortization of cemetery property 104,262 102,510 101,234 Amortization of loan costs 8,823 7,527 6,871 Provision for expected credit losses 8,894 11,542 11,245 Provision for deferred income taxes 41,017 7,541 191,516 (Gain) loss on divestitures and impairment charges, net ( 6,151 ) 12,488 ( 9,816 ) Share-based compensation 17,633 18,783 17,043 Change in assets and liabilities, net of effects from acquisitions and divestitures: Increase in receivables ( 9,723 ) ( 1,481 ) ( 3,810 ) (Increase) decrease in other assets ( 31,727 ) 65,043 ( 131,581 ) Increase (decrease) in payables and other liabilities 12,434 21,100 ( 11,296 ) Effect of preneed sales production and maturities: Increase in preneed receivables, net and trust investments ( 49,351 ) ( 134,986 ) ( 178,642 ) Increase in deferred revenue, net 30,220 59,189 157,656 Increase (decrease) in deferred receipts held in trust 37,075 31,445 ( 30,160 ) Net cash provided by operating activities 942,798 944,912 869,043 Cash flows from investing activities: Capital expenditures ( 388,553 ) ( 373,659 ) ( 361,793 ) Business acquisitions, net of cash acquired ( 101,291 ) ( 181,210 ) ( 72,535 ) Real estate acquisitions ( 18,504 ) ( 62,061 ) ( 56,409 ) Corporate headquarters ( 69,898 ) ( 15,448 ) — Proceeds from divestitures and sales of property and equipment 30,405 24,403 25,888 Payments for Company-owned life insurance policies ( 229 ) ( 3,024 ) ( 8,058 ) Proceeds from Company-owned life insurance policies 11,433 3,914 10,119 Other investing activities ( 11,647 ) ( 13,864 ) ( 6,598 ) Net cash used in investing activities ( 548,284 ) ( 620,949 ) ( 469,386 ) Cash flows from financing activities: Proceeds from issuance of long-term debt 1,060,890 1,451,137 957,433 Debt issuance costs ( 5,424 ) ( 15,390 ) ( 7,471 ) Scheduled payments of debt ( 21,233 ) ( 24,447 ) ( 22,230 ) Early payments of debt ( 804,600 ) ( 1,315,524 ) ( 580,973 ) Principal payments on finance leases ( 38,321 ) ( 36,840 ) ( 34,482 ) Proceeds from exercise of stock options 29,401 56,683 24,181 Proceeds from corporate headquarters debt facility 54,766 — — Purchase of Company common stock ( 461,015 ) ( 253,733 ) ( 544,844 ) Payments of dividends ( 183,571 ) ( 174,282 ) ( 167,983 ) Bank overdrafts and other ( 5,619 ) ( 7,245 ) ( 4,773 ) Net cash used in financing activities ( 374,726 ) ( 319,641 ) ( 381,142 ) Effect of foreign currency 5,281 ( 7,684 ) 1,722 Net increase (decrease) in cash, cash equivalents, and restricted cash 25,069 ( 3,362 ) 20,237 Cash, cash equivalents, and restricted cash at beginning of period 221,399 224,761 204,524 Cash, cash equivalents, and restricted cash at end of period $ 246,468 $ 221,399 $ 224,761 (See notes to consolidated financial statements) 46 Service Corporation International PART II Service Corporation International Consolidated Statement of Equity Common Stock Treasury Stock, Par Value Capital in Excess of Par Value Retained Earnings Accumulated Other Comprehensive Income Noncontrolling Interest Total (In thousands, except per share amounts) Balance at December 31, 2022 $ 156,089 $ ( 2,149 ) $ 958,329 $ 544,384 $ 16,538 $ 232 $ 1,673,423 Comprehensive income — — — 537,317 8,353 344 546,014 Dividends declared on common stock ($ 1.02 per share) — — — (167,983) — — ( 167,983 ) Share-based compensation earned 24 — 17,019 — — — 17,043 Stock option exercises 927 — 23,254 — — — 24,181 Restricted stock awards, net of forfeitures 132 1 (133) — — — — Purchase of Company common stock — (8,701) (59,603) (481,264) — — ( 549,568 ) Noncontrolling interest payments — — — — — (367) ( 367 ) Retirement of treasury shares (8,874) 8,874 — — — — — Other — — (1,270) — — — ( 1,270 ) Balance at December 31, 2023 $ 148,298 $ ( 1,975 ) $ 937,596 $ 432,454 $ 24,891 $ 209 $ 1,541,473 Comprehensive income — — — 518,648 (32,112) 96 486,632 Dividends declared on common stock ($ 1.12 per share) — — — (174,282) — — ( 174,282 ) Share-based compensation earned 25 — 18,758 — — — 18,783 Stock option exercises 1,646 — 55,037 — — — 56,683 Restricted stock awards, net of forfeitures 141 — (141) — — — — Purchase of Company common stock — (3,440) (23,206) (223,119) — — ( 249,765 ) Noncontrolling interest payments — — — — — 359 359 Retirement of treasury shares (3,440) 3,440 — — — — — Other — — (1,214) — — — ( 1,214 ) Balance at December 31, 2024 $ 146,670 $ ( 1,975 ) $ 986,830 $ 553,701 $ ( 7,221 ) $ 664 $ 1,678,669 Comprehensive income — — — 542,614 19,646 233 562,493 Dividends declared on common stock ($ 1.30 per share) — — — (183,571) — — ( 183,571 ) Share-based compensation earned 23 — 17,610 — — — 17,633 Stock option exercises 704 — 28,697 — — — 29,401 Restricted stock awards, net of forfeitures 121 — (121) — — — — Purchase of Company common stock — (5,865) (44,520) (413,787) — — ( 464,172 ) Noncontrolling interest payments — — — — — (327) ( 327 ) Retirement of treasury shares (5,561) 5,561 — — — — — Other — — (1,286) 1 — — ( 1,285 ) Balance at December 31, 2025 $ 141,957 $ ( 2,279 ) $ 987,210 $ 498,958 $ 12,425 $ 570 $ 1,638,841 (See notes to consolidated financial statements) FORM 10-K 47 PART II Service Corporation International Notes to Consolidated Financial Statements 1. Nature of Operations Service Corporation International (SCI) is a holding company and all operations are conducted by its subsidiaries. We are North America’s largest provider of deathcare products and services, with a network of funeral service locations and cemeteries operating in the United States and Canada. Our funeral service and cemetery operations consist of funeral service locations, cemeteries, funeral service/cemetery combination locations, crematoria, and other related businesses, which enable us to serve a wide array of customer needs. We sell cemetery property and funeral and cemetery merchandise and services at the time of need and on a preneed basis. We strive to offer families exceptional service in planning life celebrations and personalized remembrances. Funeral service locations provide all professional services relating to funerals and cremations, including the use of funeral facilities and motor vehicles, arranging and directing services, removal, preparation, embalming, cremations, memorialization, travel protection, and catering. Funeral merchandise, including burial caskets and related accessories, urns and other cremation receptacles, outer burial containers, flowers, online and video tributes, stationery products, casket and cremation memorialization products, and other ancillary merchandise, is sold at funeral service locations. Our cemeteries provide cemetery property interment rights, including developed lots, lawn crypts, mausoleum spaces, cremation niches, and custom inventory, including private mausoleums, family estates, and exclusive cremation memorialization options. Cemetery merchandise and services, including memorial cemetery markers and bases, outer burial containers, flowers and floral placement, other ancillary merchandise, graveside services, merchandise installation, and interments, are sold at our cemeteries. 2. Summary of Significant Accounting Policies Principles of Consolidation and Basis of Presentation Our consolidated financial statements include the accounts of Service Corporation International (SCI) and all subsidiaries in which we hold a controlling financial interest. Intercompany balances and transactions have been eliminated in consolidation. Our consolidated financial statements also include the accounts of the merchandise and service trusts and cemetery perpetual care trusts in which we have a variable interest and are the primary beneficiary. We have retained specialized industry accounting principles when consolidating the trusts. Our trusts are variable interest entities, for which we have determined that we are the primary beneficiary as we absorb a majority of the losses and returns associated with these trusts. Although we consolidate the trusts, it does not change the legal relationships among the trusts, us, or our customers. The customers are the legal beneficiaries of these trusts; therefore, their interests in these trusts represent a liability to us. Certain reclassifications have been made to prior period amounts to conform to the current period disclosure presentation with no effect on our consolidated net income, cash flows, or equity. Use of Estimates in the Preparation of Financial Statements The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. As a result, actual results could differ from these estimates. Cash, Cash Equivalents, and Restricted Cash We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. The carrying amounts of our cash and cash equivalents approximate fair value due to the short-term nature of these instruments. 48 Service Corporation International PART II The components of cash, cash equivalents, and restricted cash were as follows: Years Ended December 31, 2025 2024 (In thousands) Cash and cash equivalents $ 243,581 $ 218,766 Restricted cash (1) : Included in Other current assets 2,231 2,000 Included in Deferred charges and other assets 656 633 Total restricted cash 2,887 2,633 Total cash, cash equivalents, and restricted cash $ 246,468 $ 221,399 (1) Restricted cash in both periods primarily consists of proceeds from divestitures deposited into escrow accounts under IRS code section 1031 and collateralized obligations under certain insurance policies. Receivables, Net The components of Receivables, net in our Consolidated Balance Sheet were as follows: December 31, 2025 Atneed Funeral Atneed Cemetery Miscellaneous Current Portion of Notes Total (In thousands) Receivables $ 38,830 $ 20,396 $ 44,960 $ 173 $ 104,359 Reserve for credit losses ( 1,866 ) ( 1,799 ) ( 170 ) ( 109 ) ( 3,944 ) Receivables, net $ 36,964 $ 18,597 $ 44,790 $ 64 $ 100,415 December 31, 2024 Atneed Funeral Atneed Cemetery Miscellaneous Current Portion of Notes Total (In thousands) Receivables $ 35,950 $ 21,703 $ 40,559 $ 169 $ 98,381 Reserve for credit losses ( 1,558 ) ( 2,048 ) ( 320 ) ( 114 ) ( 4,040 ) Receivables, net $ 34,392 $ 19,655 $ 40,239 $ 55 $ 94,341 Additionally, included in Deferred charges and other assets, net were notes receivable, net and long-term miscellaneous receivables, net as follows: December 31, 2025 December 31, 2024 (In thousands) Notes receivable $ 9,019 $ 10,089 Reserve for credit losses ( 1,952 ) ( 1,796 ) Notes receivable, net $ 7,067 $ 8,293 Long-term miscellaneous receivables $ 7,900 $ 8,484 Reserve for credit losses ( 508 ) ( 571 ) Long-term miscellaneous receivables, net $ 7,392 $ 7,913 We provide reserves for credit losses for our receivables. These reserves are based on an analysis of historical trends of collection activity adjusted for current conditions and forecasts. These estimates are impacted by a number of factors, including changes in the economy and demographic or competitive changes in our areas of operation. Our atneed trade receivables primarily consist of amounts due for funeral and cemetery services already performed. Payment on atneed contracts is generally due at the time the merchandise is delivered or the services are performed. FORM 10-K 49 PART II We also have preneed receivables, as disclosed in Note 3, for which payment generally occurs prior to our fulfillment of the performance obligations. Cemetery preneed receivables are collateralized by cemetery property to the extent of the fair value of the property. Our preneed contracts may also have extended payment terms with associated financing charges. We do not accrue interest on preneed receivables if they are not paid in accordance with the contractual payment terms given the nature of our merchandise and services, the nature of our contracts with customers, and the timing of the delivery of our services. Generally, receivables are considered past due after thirty days. We do not consider preneed funeral receivables to be past due until the contract converts into an atneed contract at which time the preneed receivable is paid or reclassified as a trade receivable with payment terms of less than thirty days. Collections are generally managed by the locations or our in house collection team acting on behalf of the locations, until a receivable is one hundred eighty days delinquent, at which time trade receivables are fully reserved. The following table summarizes the activity in our reserve for credit losses by portfolio segment, excluding preneed receivables which are presented in Note 3 , for the year ended December 31, 2025: December 31, 2024 Provision for Expected Credit Losses Write Offs Recoveries Effect of Foreign Currency December 31, 2025 (In thousands) Trade receivables: Funeral $ ( 1,558 ) $ ( 5,141 ) $ 7,420 $ ( 2,934 ) $ 347 $ ( 1,866 ) Cemetery ( 2,048 ) ( 770 ) 1,665 ( 646 ) — ( 1,799 ) Total reserve for credit losses on trade receivables $ ( 3,606 ) $ ( 5,911 ) $ 9,085 $ ( 3,580 ) $ 347 $ ( 3,665 ) Miscellaneous receivables: Current $ ( 320 ) $ 115 $ — $ — $ 35 $ ( 170 ) Long-term ( 571 ) 63 — — — ( 508 ) Total reserve for credit losses on miscellaneous receivables $ ( 891 ) $ 178 $ — $ — $ 35 $ ( 678 ) Reserve for credit losses on notes receivable $ ( 1,910 ) $ ( 150 ) $ — $ — $ ( 1 ) $ ( 2,061 ) At December 31, 2025, the amortized cost basis of our miscellaneous and notes receivables by year of origination was as follows: 2025 2024 2023 2022 2021 Prior Revolving Line of Credit Total (In thousands) Miscellaneous receivables: Current $ 41,604 $ 2,637 $ 562 $ 142 $ 13 $ 2 $ — $ 44,960 Long-term 3,283 2,814 1,366 372 57 8 — 7,900 Total miscellaneous receivables $ 44,887 $ 5,451 $ 1,928 $ 514 $ 70 $ 10 $ — $ 52,860 Notes receivable $ — $ — $ — $ — $ — $ 4,457 $ 4,735 $ 9,192 50 Service Corporation International PART II At December 31, 2025, the payment status of our miscellaneous and notes receivables was as follows: Past Due <30 Days 30-90 Days 90-180 Days >180 Days Total Current Total (In thousands) Miscellaneous receivables: Current $ — $ — $ — $ 2,394 $ 2,394 $ 42,566 $ 44,960 Long-term — — — — — 7,900 7,900 Total miscellaneous receivables $ — $ — $ — $ 2,394 $ 2,394 $ 50,466 $ 52,860 Notes receivable $ — $ — $ — $ 1,115 $ 1,115 $ 8,077 $ 9,192 Inventories and Cemetery Property Funeral and cemetery merchandise are stated at the lower of average cost or net realizable value. Cemetery property is recorded at cost. Inventory costs and cemetery property are relieved using specific identification upon fulfillment of performance obligations of our contracts. Cemetery property amortization was $ 104.3 million, $ 102.5 million, and $ 101.2 million for the years ended December 31, 2025, 2024, and 2023, respectively. Property and Equipment, Net Property and equipment are recorded at cost. Maintenance and repairs are charged to expense, whereas renewals and major replacements that extend the useful lives of the assets are capitalized. Depreciation is recognized ratably over the estimated useful lives of the various classes of assets. Buildings and improvements are depreciated over a period ranging from ten years to forty years , equipment is depreciated over a period from three years to twelve years ; and leasehold improvements are depreciated over the shorter of the lease term or twelve years . Depreciation and amortization expense related to property and equipment was $ 219.7 million, $ 208.2 million, and $ 191.3 million for the years ended December 31, 2025, 2024, and 2023, respectively. When property or equipment is sold or retired, the cost and related accumulated depreciation are removed from the Consolidated Balance Sheet and the resulting gains and losses are included in the Consolidated Statement of Operations in the period of sale or disposal. Leases We have both operating and finance leases. Our operating leases primarily include funeral service real estate and office equipment for funeral service locations, cemetery locations, and administrative offices. Our finance leases primarily include transportation equipment but also include real estate and office equipment. Lease terms related to real estate generally range from one year to forty years with options to renew at varying terms. Lease terms related to office and transportation equipment generally range from one year to eight years with options to renew at varying terms. We determine whether an arrangement is or contains a lease at the inception of the arrangement based on the unique facts and circumstances present. Right-of-use (ROU) assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. Leases with a term greater than one year are recognized on the balance sheet as ROU assets and lease liabilities. We have elected not to recognize on the balance sheet leases with terms of one year or less. Lease liabilities and their corresponding ROU assets are recorded at commencement date based on the present value of lease payments over the expected lease term. For transportation equipment, we use the rate implicit in each lease to calculate the present value. For real estate and non-transportation equipment leases, the interest rate implicit in lease contracts is typically not readily determinable. Therefore, we use the appropriate collateralized incremental borrowing rate based on the information available at commencement date in determining the present value of future payments for real estate and non-transportation equipment leases. Certain adjustments to the ROU asset may be required for items such as initial direct costs paid or incentives received. For a lessee, the discount rate for the lease is defined as the rate implicit in the lease unless that rate cannot be readily determined. In that case, the lessee is required to use its incremental borrowing rate, which is the rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term with an amount equal to the lease payments in a similar economic environment. We use the rate implicit in each lease for vehicles and other transportation equipment, which represen ts 59% of our total lease liability as of December 31, 2025 and which are substantially all finance leases. For leases of real estate and non-transportation equipment, which are primarily operating leases, we use our incremental borrowing rate since the rate implicit in these leases cannot be readily determined. To calculate the incremental borrowing rate, we utilize the yield-to-worst of our publicly traded debt securities, adjusted for the appropriate duration on a secured basis. As an accounting policy election, we include reasonably certain renewal periods when determining the rate to use as the incremental borrowing rate for each lease. FORM 10-K 51 PART II We calculate operating lease expense ratably over the lease term. We consider reasonably assured renewal options and fixed escalation provisions in our calculation. Generally, our leases do not include options to terminate the lease prior to the contractual lease expiration date, but future renewal periods are generally cancelable. The majority of our contractually available renewal periods for leases of buildings and land are considered reasonably certain of being exercised. This determination is made by our real estate team based on facts and circumstances surrounding each property. Leases with a term of 12 months or less are not recorded on the balance sheet. The majority of our lease arrangements contain options to (i) purchase the property at fair value on the exercise date, (ii) purchase the property for a value determined at the inception of the lease, or (iii) renew the lease for the fair rental value at the end of the primary lease term. The depreciable life of assets and leasehold improvements are generally limited by the expected lease term. Certain of our lease agreements include variable rental payments based on a percentage of sales over base contractual levels and others include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. We generally do not have sublease arrangements, sale-leaseback arrangements, or leveraged leases. We have lease agreements with lease and non-lease components, which are generally accounted for separately. For leases commencing before January 1, 2019, we have elected the practical expedient to not separate lease and non-lease components on certain equipment leases, such as copiers where the cost-per-copy maintenance charges are included in the lease charge. On these leases, we have elected to account for the lease and non-lease components as a single component. For leases commencing on or after January 1, 2019, we account for the maintenance charges (non-lease components) separately from the lease components. For more information related to leases, see Note 8 . Goodwill The excess of purchase price over the fair value of identifiable net assets acquired in business combinations is recorded as goodwill. Goodwill is evaluated annually during the fourth quarter for impairment by assessing the fair value of each of our reporting units. Our goodwill impairment test involves estimates and management judgment. In order to perform our goodwill impairment test, we perform either a qualitative or quantitative assessment. If we choose to perform a qualitative assessment, we evaluate economic, industry and company-specific factors in assessing the fair value of the related reporting unit. If we determine that it is more likely than not that the fair value of the reporting unit is less that its carrying value, a quantitative test is then performed. For those reporting units tested using a quantitative approach, we compare the fair value of a reporting unit to its carrying amount, including goodwill. We determine fair value of each reporting unit using an income approach. The income approach, which is a discounted cash flow method, uses projections of future cash flows and includes assumptions concerning future operating performance and economic conditions that may differ from actual future cash flows. We do not record an impairment of goodwill in instances where the fair value of a reporting unit exceeds its carrying amount. If the carrying amount exceeds the fair value of a reporting unit, an impairment is recognized in an amount equal to the excess, up to the amount of goodwill in the reporting unit. For our most recent annual impairment test performed in the fourth quarter, we performed a qualitative analysis for each of our reporting units. After evaluating economic, industry and company-specific factors for each of our reporting units, we determined it was more likely than not that the fair values of our reporting units exceeded their carrying values. Thus, no quantitative assessment was required. In addition to our annual review, we may assess the impairment of goodwill whenever certain events or changes in circumstances indicate that the carrying value may be greater than fair value. Factors that could trigger an interim impairment review include, but are not limited to, significant underperformance relative to historical or projected future operating results and significant negative industry or economic trends. For more information related to goodwill, see Note 4 . Other Intangible Assets Our intangible assets include covenants-not-to-compete, customer relationships, trademarks and tradenames, and other intangible assets primarily resulting from acquisitions. Certain of our trademark and tradenames and other intangible assets are considered to have an indefinite life and are not subject to amortization. We test for impairment of indefinite-lived intangible assets annually during the fourth quarter. Our intangible asset impairment tests involve estimates and management judgment. For trademarks and tradenames, our test uses the relief from royalty method whereby we determine the fair value of the assets by discounting the cash flows that represent a savings over having to pay a royalty fee for use of the trademarks and tradenames. The discounted cash flow valuation uses projections of future cash flows and includes assumptions concerning future operating performance and economic conditions that may differ from actual future cash flows. For our most recent annual impairment test performed in the fourth quarter, we estimated that the pre-tax savings would range from 2.0 % to 5.0 % ( 4.7 % weighted average using carrying value) of the revenue associated with the trademarks and tradenames, based primarily on our research of intellectual property valuation and licensing databases. We also assumed a terminal growth rate of 2.0 % and 2.5 % for our funeral and cemetery segments, respectively, and discounted the cash flows at a 7.75 % discount rate based on the relative risk of these assets to our overall business. 52 Service Corporation International PART II In addition to our annual review, we may assess the impairment of intangible assets whenever certain events or changes in circumstances indicate that the carrying value may be greater than the fair value. Factors that could trigger an interim impairment review include, but are not limited to, significant under-performance relative to historical or projected future operating results and significant negative industry or economic trends. Certain of our intangible assets associated with prior acquisitions are relieved using specific identification in fulfillment of performance obligations on our contracts with customers. We amortize all other finite-lived intangible assets on a straight-line basis over their estimated useful lives, which range from five years to eighty-nine years . For more information related to intangible assets, see Note 4 . Fair Value Measurements We measure the securities held by our funeral merchandise and service, cemetery merchandise and service, and cemetery perpetual care trusts at fair value on a recurring basis. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We utilize a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: • Where quoted prices are available in an active market, securities held by the trusts are classified as Level 1 investments. • Where quoted market prices are not available for the specific security, fair values are estimated by using either quoted prices of securities with similar characteristics or an income approach fair value model with observable inputs that include a combination of interest rates, yield curves, credit risks, prepayment speeds, ratings, and tax-exempt status. These securities are classified as Level 2 investments. • The valuation of other investments requires management judgment due to the absence of quoted market prices, inherent lack of liquidity, and the long-term nature of such assets. These securities are classified as Level 3 investments. Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Fixed income commingled funds, money market funds, and private equity investments are measured at net asset value. Fixed income commingled funds and money market funds are redeemable for net asset value with two weeks' notice and immediately, respectively. Our private equity investments include several funds that invest in limited partnerships, distressed debt, real estate, and mezzanine financing. These investments can never be redeemed by the funds. Instead, due to the nature of the investments in this category, distributions are received through the liquidation of the underlying assets of the funds. Valuation policies and procedures are determined by our Trust Services department, which reports to our Chief Financial Officer. Additionally, valuations are reviewed quarterly by the Investment Committee of the Board of Directors. Treasury Stock We make treasury stock purchases in the open market or through privately negotiated transactions subject to market conditions and normal trading restrictions. We account for the repurchase of our common stock under the par value method. We canceled 5.6 million, 3.4 million, and 8.9 million shares of our common stock held in our treasury in 2025, 2024, and 2023, respectively. These retired treasury shares were changed to authorized but unissued status. Foreign Currency Translation All assets and liabilities of Canadian subsidiaries are translated into U.S. dollars at exchange rates in effect as of the end of the reporting period. Revenue and expense items are translated at the average exchange rates for the reporting period. The resulting translation adjustments are included as a component of Accumulated other comprehensive income in the Consolidated Statement of Equity and Consolidated Balance Sheet. The functional currency of SCI and its subsidiaries is the respective local currency. The transactional currency gains and losses that arise from transactions denominated in currencies other than the functional currencies of our operations are recorded in Other income, net in the Consolidated Statement of Operations. We do not have any investments in foreign operations considered to be in highly inflationary economies. Funeral and Cemetery Operations Revenue is recognized when control of the merchandise or services is transferred to the customer. Our performance obligations include the delivery of funeral and cemetery merchandise and services and cemetery property interment rights. Control transfers when merchandise is delivered or services are performed. For cemetery property interment rights, control transfers to the customer when the property is developed and the interment right has been sold and can no longer be marketed or sold to another customer. Sales taxes collected are recognized on a net basis in our consolidated financial statements. On our atneed contracts, we generally deliver the merchandise and perform the services at the time of need. Personalized marker merchandise and marker installation services sold on atneed contracts are recognized when control is transferred to the customer, generally when the marker is delivered and installed in the cemetery. FORM 10-K 53 PART II We also sell price-guaranteed preneed contracts through various programs providing for future merchandise and services at prices prevailing when the agreements are signed. Revenue associated with sales of preneed contracts is deferred until control of the merchandise or the services is transferred to the customer, which is upon delivery of the merchandise or as services are performed, generally at the time of need. On certain preneed contracts, we historically sold memorialization merchandise, which consists of urns and urn-related products, that we delivered to the customer at the time of sale. In 2024, we began a transition and operational shift to defer the delivery of urns on preneed contracts to the time of need. Revenue is recognized at the time of delivery as control of the memorialization merchandise is transferred to the customer. For personalized marker merchandise sold on a preneed contract, we will: • purchase the merchandise from vendors, • personalize such merchandise in accordance with the customer's specific written instructions, • either store the merchandise at a third-party bonded storage facility or install the merchandise, based on the customer's instructions, and • transfer title to the customer. We recognize revenue and record the cost of sales when control of the merchandise is transferred, which occurs upon delivery to the third-party storage facility or installation of the merchandise at the cemetery. There is no general right of return for delivered items. We also sell travel protection as an agent of a third party. Travel protection is a service that provides shipment of remains to the servicing funeral home or cemetery of choice if the purchaser passes away outside of a certain radius of their residence, without any additional expense to the family. We do not provide these travel protection services, and we are not primarily obligated to provide such services under these arrangements. Therefore, we record revenue, net of amounts due to the third-party, at the time of sale. Total consideration received for price-guaranteed preneed and for atneed contracts with customers represents the stated amount of the contract excluding any amounts collected on behalf of third parties, such as sales taxes. Additionally, pursuant to state or provincial law, all or a portion of the proceeds from merchandise or services sold on a preneed basis may be required to be deposited into trust funds. Earnings on these trust funds, which are specifically identifiable for each performance obligation, are also included in total consideration. The total consideration received for contracts with customers is allocated to each performance obligation based on relative selling price. Relative selling prices are determined by either the amount we sell the performance obligation for on a stand-alone basis or our best estimate of the amount we would sell it for based on an adjusted market assessment approach that is consistent with our historical pricing practices. Payment on atneed contracts is generally due at the time the merchandise is delivered or the services are performed. For preneed contracts, payment generally occurs prior to our fulfillment of the performance obligations. Our preneed contracts may also have extended payment terms with associated financing charges. We do not accrue interest on preneed receivables if they are not paid in accordance with the contractual payment terms given the nature of our merchandise and services, the nature of our contracts with customers, and the timing of the delivery of our services. We do not consider preneed receivables to be past due until the merchandise or services are required to be delivered at which time the preneed receivable is paid or reclassified as a trade receivable with payment terms of less than thirty days. For unfulfilled performance obligations on cancelable preneed contracts, our Consolidated Balance Sheet reflects the net contract liability, which represents the amount we have collected from customers, in Deferred revenue, net . Pursuant to state or provincial law, all or a portion of the proceeds from merchandise or services sold on a preneed basis may be required to be deposited into trust funds. When we receive payments from the customer, we deposit the amount required by law into the merchandise and service trusts and reclassify the corresponding amount from Deferred revenue, net into Deferred receipts held in trust . Amounts are withdrawn from the merchandise and service trusts when we fulfill the performance obligations. Fixed income securities held by these trust funds are classified as trading securities. Earnings on these trust funds, which are specifically identifiable for each performance obligation, are also included in total consideration. We defer these investment earnings related to the merchandise and service trusts until the associated merchandise is delivered or services are performed. Fees charged by our wholly-owned registered investment advisor are also included in revenue in the period in which they are earned. If a preneed contract is canceled prior to delivery, state or provincial law determines the amount of the refund owed to the customer, if any, including the amount of the attributed investment earnings. Upon cancellation, we receive the amount of principal deposited to the trust and previously undistributed net investment earnings and, where required, issue a refund to the customer. In addition, we are entitled to retain, in certain jurisdictions, a portion of collected customer payments when a customer cancels a preneed contract. We recognize these retained funds, if any, and the attributed investment earnings (net of any investment earnings payable to the customer) as revenue in the Consolidated Statement of Operations. In certain jurisdictions, we may be obligated to fund any shortfall if the amount refundable to the customer exceeds the funds in trust. A portion of the proceeds from the sale of cemetery property interment rights is required by state or provincial law to be paid into perpetual care trust funds by us to maintain the cemetery. This portion of the proceeds is not recognized as revenue. 54 Service Corporation International PART II Fixed income securities held by these trust funds are classified as trading securities. Investment earnings from these trusts are distributed to us regularly and recognized in current cemetery revenue. These distributions are intended to defray cemetery maintenance costs incurred by us for our cemetery properties, which are expensed as incurred. The principal of such perpetual care trust funds generally cannot be withdrawn; however, in lieu of the distribution of realized income, certain states allow a total return distribution, which may contain elements of income, capital appreciation, and principal. Costs related to delivery or performance of merchandise and services are charged to expense when merchandise is delivered or services are performed. Costs related to property interment rights include the property and construction costs specifically identified by each project. Property and construction costs are charged to expense when the revenue is recognized by specific identification in the fulfillment of the performance obligation. Incremental direct selling costs are deferred until fulfillment of the performance obligations. These deferred costs are classified as long-term on our Consolidated Balance Sheet because we do not control the timing of the delivery of the merchandise or performance of the services as they are generally provided at the time of need. For the years ended December 31, 2025, 2024, and 2023, we recognized $ 230.9 million, $ 239.8 million, and $ 247.4 million, respectively, of incremental selling costs. All other selling costs are expensed as incurred. The components of Cost of revenue in our Consolidated Statement of Operations are: • Cost of property and merchandise , which includes cemetery property amortization, the direct cost of merchandise, labor-related costs for merchandise handling and delivery, cemetery maintenance expenses, depreciation, and selling costs; • Cost of services , which includes the direct cost of providing the services (including labor-related costs), cemetery maintenance expenses and depreciation, vehicle operating costs and depreciation, and selling costs; and • Overhead and other expenses , which includes labor-related costs, facility expenses and depreciation, and other general and administrative expenses incurred in our funeral and cemetery operations. Corporate general and administrative expenses include labor-related costs, corporate asset depreciation and amortization, public company costs, and other general and administrative expenses incurred by our corporate functions. Insurance-Funded Preneed Contracts Where permitted by state or provincial law, we may sell a life insurance or annuity policy from third-party insurance companies, for which we earn a commission as general sales agent for the insurance company. These general agency commissions (GA revenue) are based on a percentage per contract sold and are recognized as funeral revenue when the insurance purchase transaction between the preneed purchaser and third-party insurance provider is completed. All selling costs incurred pursuant to the sale of insurance-funded preneed contracts are expensed as incurred. GA revenue recognized in 2025, 2024, and 2023 was $ 292.1 million, $ 230.9 million, and $ 185.6 million, respectively. We do not reflect the unfulfilled insurance-funded preneed contract amounts in our Consolidated Balance Sheet. The policy amount of the insurance contract between the customer and the third-party insurance company generally equals the amount of the preneed contract. The policyholder has made a revocable commitment to assign the proceeds from the policy to us at the time of need. The proceeds of the life insurance policies or annuity contracts will be reflected in funeral revenue as we perform these funerals. Income Taxes We compute income taxes using the liability method. Our ability to realize the benefit of our deferred tax assets requires us to achieve certain future earnings levels. We have established a valuation allowance against a portion of our deferred tax assets. We could be required to further adjust that valuation allowance in the near term if market conditions change materially and future earnings are, or are projected to be, significantly different than our current estimates. An increase in the valuation allowance would result in additional income tax expense in such period. All deferred tax assets and liabilities, along with any related valuation allowances are classified as non-current on our Consolidated Balance Sheet. Restructuring Charge In 2025, we recognized a restructuring charge of $2.0 million, primarily due to professional fees incurred in connection with the implementation and completion of restructuring actions. We paid $21.6 million of deferred compensation arrangements primarily associated with retired executives and other restructuring related charges during 2025. The restructuring charge is presented separately on our Consolidated Statement of Operations. In 2024, we recognized a restructuring charge of $11.5 million, which included the retirements and position eliminations of various home office and corporate positions as part of ongoing cost management. We paid $2.3 million of the recognized charge during 2024. The restructuring charge is presented separately on our Consolidated Statement of Operations. FORM 10-K 55 PART II Accounting Standards Adopted in 2025 Income Tax In December 2023, the FASB amended guidance that requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as additional information on income taxes paid. The Company adopted the new guidance for the year ended December 31, 2025 and applied the disclosure requirements retrospectively to all prior periods presented in the financial statements. Recently Issued Accounting Standards Disaggregation of Income Statement Expenses In November 2024, the FASB issued guidance that requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. The guidance is effective for annual reporting periods beginning after December 15, 2026, with early adoption permitted, and it can be adopted either on a prospective or retrospective basis. Upon adoption, we will include the additional disclosures in our financial statements and related notes, however the guidance will not have a material effect on our financial position or results of operations. Internal-Use Software In September 2025, the FASB issued guidance to modernize the accounting for software costs that are accounted for under Subtopic 350-40, Intangibles-Goodwill and Other-Internal-Use Software. The new guidance is effective for us for the 2028 annual period, with early adoption permitted, and it can be adopted either on a prospective, modified or retrospective basis. We are currently assessing the impact of this guidance on our disclosures, and upon adoption, we will include the required disclosures in our financial statements and related notes. 3. Preneed Activities Preneed Receivables, Net and Trust Investments The components of Preneed receivables, net and trust investments in our Consolidated Balance Sheet were as follows: Years Ended December 31, 2025 2024 (In thousands) Preneed receivables, net $ 1,561,836 $ 1,570,773 Trust investments, at fair value 7,965,010 7,084,723 Insurance-backed fixed income securities and other 232,560 237,868 Trust investments 8,197,570 7,322,591 Less: Cemetery perpetual care trust investments ( 2,398,613 ) ( 2,154,032 ) Preneed trust investments 5,798,957 5,168,559 Preneed receivables, net and trust investments $ 7,360,793 $ 6,739,332 Preneed receivables, net comprised the following: December 31, 2025 Funeral Cemetery Total (In thousands) Preneed receivables $ 142,485 $ 1,482,721 $ 1,625,206 Unearned finance charges ( 13,486 ) ( 15,204 ) ( 28,690 ) Preneed receivables, at amortized cost $ 128,999 $ 1,467,517 $ 1,596,516 Reserve for credit losses ( 20,632 ) ( 14,048 ) ( 34,680 ) Preneed receivables, net $ 108,367 $ 1,453,469 $ 1,561,836 56 Service Corporation International PART II December 31, 2024 Funeral Cemetery Total (In thousands) Preneed receivables $ 183,016 $ 1,444,084 $ 1,627,100 Unearned finance charges ( 11,083 ) ( 9,387 ) ( 20,470 ) Preneed receivables, at amortized cost $ 171,933 $ 1,434,697 $ 1,606,630 Reserve for credit losses ( 20,132 ) ( 15,725 ) ( 35,857 ) Preneed receivables, net $ 151,801 $ 1,418,972 $ 1,570,773 At December 31, 2025, the amortized cost basis of our preneed receivables by year of origination was as follows: 2025 2024 2023 2022 2021 Prior Total (In thousands) Preneed receivables, at amortized cost: Funeral $ 26,117 $ 35,128 $ 29,238 $ 14,857 $ 7,367 $ 16,292 $ 128,999 Cemetery 577,225 401,813 259,307 141,389 52,557 35,226 1,467,517 Total preneed receivables, at amortized cost $ 603,342 $ 436,941 $ 288,545 $ 156,246 $ 59,924 $ 51,518 $ 1,596,516 At December 31, 2025, the payment status of our preneed receivables was as follows: Past Due <30 Days 30-90 Days 90-180 Days >180 Days Total Current Total (In thousands) Preneed receivables, at amortized cost: Funeral $ 3,967 $ 2,348 $ 1,423 $ 31,094 $ 38,832 $ 90,167 $ 128,999 Cemetery 54,778 51,295 12,456 4,334 122,863 1,344,654 1,467,517 Total preneed receivables, at amortized cost $ 58,745 $ 53,643 $ 13,879 $ 35,428 $ 161,695 $ 1,434,821 $ 1,596,516 The following table summarizes the activity for the reserve for credit losses on preneed receivables for the twelve months ended December 31, 2025. December 31, 2024 Provision for Expected Credit Losses Write Offs Effect of Foreign Currency December 31, 2025 (In thousands) Funeral $ ( 20,132 ) $ ( 4,051 ) $ 3,554 $ ( 3 ) $ ( 20,632 ) Cemetery ( 15,725 ) 1,040 653 ( 16 ) ( 14,048 ) Total reserve for credit losses on preneed receivables $ ( 35,857 ) $ ( 3,011 ) $ 4,207 $ ( 19 ) $ ( 34,680 ) FORM 10-K 57 PART II The table below sets forth certain investment-related activities associated with our trusts: Years Ended December 31, 2025 2024 2023 (In thousands) Deposits $ 644,140 $ 637,406 $ 590,257 Withdrawals $ 600,900 $ 608,251 $ 591,591 Purchases of securities $ 2,333,514 $ 2,227,515 $ 2,070,313 Sales of securities $ 2,193,952 $ 2,212,443 $ 2,038,517 Realized gains from sales of securities (1) $ 538,513 $ 509,982 $ 281,168 Realized losses from sales of securities (1) $ ( 131,685 ) $ ( 183,620 ) $ ( 227,075 ) (1) All realized gains and losses are recognized in Other income, net for our trust investments and are offset by a corresponding reclassification in Other income, net to Deferred receipts held in trust and Care trusts’ corpus. The activity in Preneed receivables, net and trust investments was as follows: Years Ended December 31, 2025 2024 2023 (In thousands) Beginning balance - Preneed receivables, net and trust investments $ 6,739,332 $ 6,191,912 $ 5,577,499 Net preneed contract sales 1,878,217 1,946,232 1,973,012 Cash receipts from customers, net of refunds ( 1,805,347 ) ( 1,752,920 ) ( 1,699,683 ) Deposits to trust 562,614 557,398 515,866 Acquisitions of businesses, net 5,865 60,561 3,394 Net undistributed investment earnings (losses) (1) 576,106 424,543 527,264 Maturities and distributed earnings ( 584,826 ) ( 595,087 ) ( 591,834 ) Change in cancellation allowance 1,195 ( 3,430 ) ( 5,160 ) Change in amounts due on unfulfilled performance obligations ( 19,758 ) ( 43,547 ) ( 93,473 ) Effect of foreign currency and other 7,395 ( 46,330 ) ( 14,973 ) Ending balance - Preneed receivables, net and trust investments $ 7,360,793 $ 6,739,332 $ 6,191,912 (1) Includes both realized and unrealized investment earnings. 58 Service Corporation International PART II The cost and fair values associated with trust investments recorded at fair value at December 31, 2025 and 2024 are detailed below. Cost reflects the investment (net of redemptions) of control holders in the trusts. Fair value represents the value of the underlying securities held by the trusts. December 31, 2025 Fair Value Hierarchy Level Cost Unrealized Gains Unrealized Losses Value (In thousands) Fixed income securities: U.S. Treasury 2 $ 50,233 $ 305 $ ( 488 ) $ 50,050 Canadian government 2 26,086 — — 26,086 Corporate 2 10,352 310 ( 7 ) 10,655 Residential mortgage-backed 2 3,202 68 ( 28 ) 3,242 Asset-backed 2 279 — ( 41 ) 238 Equity securities: Preferred stock 2 13,831 2,428 — 16,259 Common stock: United States 1 2,071,402 745,982 ( 95,511 ) 2,721,873 Canada 1 41,650 34,904 ( 1,219 ) 75,335 Other international 1 167,881 43,880 ( 5,910 ) 205,851 Mutual funds: Equity 1 938,778 253,372 ( 5,546 ) 1,186,604 Fixed income 1 671,067 8,531 ( 27,280 ) 652,318 Trust investments, at fair value 3,994,761 1,089,780 ( 136,030 ) 4,948,511 Commingled funds Fixed income 1,387,350 14,443 ( 50,208 ) 1,351,585 Equity 362,862 155,590 — 518,452 Money market funds 423,957 — — 423,957 Alternative investments 503,898 228,320 ( 9,713 ) 722,505 Trust investments, at net asset value 2,678,067 398,353 ( 59,921 ) 3,016,499 Trust investments, at market $ 6,672,828 $ 1,488,133 $ ( 195,951 ) $ 7,965,010 As of December 31, 2025, our unfunded commitment for our private equity investments was $ 435.7 million which, if called, would be funded by the assets of the trusts. FORM 10-K 59 PART II December 31, 2024 Fair Value Hierarchy Level Cost Unrealized Gains Unrealized Losses Value (In thousands) Fixed income securities: U.S. Treasury 2 $ 43,699 $ 178 $ ( 849 ) $ 43,028 Canadian government 2 25,979 — — 25,979 Corporate 2 10,087 326 ( 11 ) 10,402 Residential mortgage-backed 2 3,811 39 ( 49 ) 3,801 Asset-backed 2 290 — ( 47 ) 243 Equity securities: Preferred stock 2 8,059 930 ( 25 ) 8,964 Common stock: United States 1 1,887,854 617,695 ( 68,404 ) 2,437,145 Canada 1 41,362 20,164 ( 1,160 ) 60,366 Other international 1 120,605 34,414 ( 10,382 ) 144,637 Mutual funds: Equity 1 950,990 121,006 ( 13,892 ) 1,058,104 Fixed income 1 1,028,622 4,183 ( 46,391 ) 986,414 Trust investments, at fair value 4,121,358 798,935 ( 141,210 ) 4,779,083 Commingled funds Fixed income 862,350 2,597 ( 60,646 ) 804,301 Equity 346,553 99,647 ( 316 ) 445,884 Money market funds 432,821 — — 432,821 Alternative investments 438,449 193,638 ( 9,453 ) 622,634 Trust investments, at net asset value 2,080,173 295,882 ( 70,415 ) 2,305,640 Trust investments, at market $ 6,201,531 $ 1,094,817 $ ( 211,625 ) $ 7,084,723 Our alternative investments include funds invested in limited partnerships with interests in private equity, private market real estate, energy and natural resources, infrastructure, transportation, and private debt including both distressed debt and mezzanine financing. These investments can never be redeemed by the funds. Instead, due to the nature of the investments in this category, distributions are received through the liquidation of the underlying assets of the funds. The funds' managers have not communicated the timing of any liquidations. Maturity dates of our fixed income securities range from 2025 to 2044 . Maturities of fixed income securities (excluding mutual funds) at December 31, 2025 are estimated as follows: Fair Value (In thousands) Due in one year or less $ 49,393 Due in one to five years 34,963 Due in five to ten years 5,886 Thereafter 29 Total estimated maturities of fixed income securities $ 90,271 Recognized trust fund income (realized and unrealized) related to our preneed trust investments was $ 202.2 million, $ 185.7 million, and $ 158.2 million for the years ended December 31, 2025, 2024, and 2023, respectively. Recognized trust fund income (realized and unrealized) related to our cemetery perpetual care trust investments was $ 111.1 million, $ 96.4 million, and $ 86.6 million for the years ended December 31, 2025, 2024, and 2023, respectively. 60 Service Corporation International PART II Deferred Revenue, Net Deferred revenue, net represents future revenue, including distributed trust investment earnings associated with unperformed trust-funded preneed contracts that are not held in trust accounts. Future revenue and net trust investment earnings that are held in trust accounts are included in Deferred receipts held in trust . The components of Deferred revenue, net in our Consolidated Balance Sheet were as follows: Years Ended December 31, 2025 2024 (In thousands) Deferred revenue $ 2,790,149 $ 2,745,104 Amounts due from customers for unfulfilled performance obligations on cancelable preneed contracts ( 1,010,883 ) ( 989,934 ) Deferred revenue, net $ 1,779,266 $ 1,755,170 The following table summarizes the activity for our contract liabilities, which are reflected in Deferred revenue, net and Deferred receipts held in trust : Years Ended December 31, 2025 2024 2023 (In thousands) Beginning balance — Deferred revenue, net and Deferred receipts held in trust $ 6,917,695 $ 6,374,393 $ 5,787,548 Net preneed contract sales 1,321,645 1,386,108 1,451,833 Acquisitions (dispositions) of businesses, net 10,614 78,894 5,961 Net investment gains (losses) (1) 562,045 418,483 527,894 Recognized revenue from backlog (2) ( 565,688 ) ( 574,414 ) ( 554,839 ) Recognized revenue from current period sales ( 671,862 ) ( 677,475 ) ( 730,436 ) Change in amounts due on unfulfilled performance obligations ( 19,609 ) ( 43,547 ) ( 93,473 ) Change in cancellation reserve 975 2,332 87 Effect of foreign currency and other 7,849 ( 47,079 ) ( 20,182 ) Ending balance — Deferred revenue, net and Deferred receipts held in trust $ 7,563,664 $ 6,917,695 $ 6,374,393 (1) Includes both realized and unrealized investment gains (losses). (2) Includes current year trust fund income through the date of performance. 4. Goodwill and Intangible Assets The changes in the carrying amounts of goodwill for our funeral and cemetery reporting units are as follows: Years Ended December 31, 2025 2024 Funeral Cemetery Total Funeral Cemetery Total (In thousands) Beginning balance — Goodwill $ 1,685,033 $ 395,982 $ 2,081,015 $ 1,618,370 $ 358,816 $ 1,977,186 Increase in goodwill related to acquisitions 72,501 10,810 83,311 75,734 37,167 112,901 Reduction of goodwill related to divestitures (1) — — — ( 996 ) — ( 996 ) Effect of foreign currency 4,726 3 4,729 ( 8,075 ) ( 1 ) ( 8,076 ) Total activity 77,227 10,813 88,040 66,663 37,166 103,829 Ending balance — Goodwill $ 1,762,260 $ 406,795 $ 2,169,055 $ 1,685,033 $ 395,982 $ 2,081,015 (1) Also includes reductions for businesses held for sale. FORM 10-K 61 PART II The components of intangible assets at December 31 were as follows: Useful Life Minimum Maximum 2025 2024 (Years) (In thousands) Amortizing intangibles: Covenants-not-to-compete 1 - 15 $ 229,391 $ 226,292 Customer relationships 10 - 20 136,956 136,675 Tradenames 5 - 89 7,000 7,000 Other 5 - 89 26,927 26,927 400,274 396,894 Less accumulated amortization: Covenants-not-to-compete 211,805 208,589 Customer relationships 99,478 94,087 Tradenames 595 516 Other 12,503 11,764 324,381 314,956 Amortizing intangibles, net 75,893 81,938 Non-amortizing intangibles: Tradenames Indefinite 386,890 419,679 Other Indefinite 10,791 10,765 Non-amortizing intangibles 397,681 430,444 Intangible assets, net — included in Deferred charges and other assets, net $ 473,574 $ 512,382 As part of our recoverability testing process during 2025, we incurred an impairment on tradenames of $2.0 million. Amortization expense for intangible assets was $ 16.4 million, $ 17.2 million, and $ 18.7 million for the years ended December 31, 2025, 2024, and 2023, respectively. The following is estimated amortization expense, excluding certain intangibles for which we are unable to provide an estimate because they are amortized based on specific identification in the fulfillment of performance obligations on our preneed contracts, for the five years subsequent to December 31, 2025 (in thousands): 2026 $ 4,808 2027 3,324 2028 2,725 2029 2,653 2030 2,570 Total estimated amortization expense $ 16,080 5. Income Taxes The provision or benefit for income taxes includes U.S. federal income taxes (determined on a consolidated return basis), foreign income taxes, and state income taxes. We participate in tax equity investments in renewable energy projects that qualify for federal investment tax credits. These investments are accounted for under the proportional amortization method. Tax credits and other related tax benefits are recognized as a reduction of income tax expense as they are realized, with corresponding amortization of the investment in proportion to the tax benefits received. During 2025, we recognized $ 5.3 million of investment tax credits and other tax benefits and recorded $ 5.2 million of amortization related to these investments. The tax credits and related amortization are presented net within the Provision for income taxes in the Consolidated Statement of Operations. As of December 31, 2025, the unamortized balance of renewable energy tax credit investments was $ 51.1 million, and unfunded commitments related to these investments totaled $ 40.8 million. These amounts are included in Deferred charges and other assets and Accounts payable and accrued liabilities , respectively, on the Consolidated Balance Sheet. 62 Service Corporation International PART II Income before income taxes was composed of the following components: Years Ended December 31, 2025 2024 2023 (In thousands) United States $ 689,745 $ 631,159 $ 664,745 Foreign 40,038 44,259 43,861 Total income before income taxes $ 729,783 $ 675,418 $ 708,606 Income tax provision consisted of the following: Years Ended December 31, 2025 2024 2023 (In thousands) Current: United States 104,582 113,379 ( 30,832 ) Foreign 13,268 13,069 14,989 State 28,071 22,676 ( 4,728 ) Total current income taxes 145,921 149,124 ( 20,571 ) Deferred: United States $ 36,764 $ 5,971 $ 155,677 Foreign ( 1,561 ) ( 32 ) ( 1,999 ) State 5,814 1,602 37,838 Total deferred income taxes 41,017 7,541 191,516 Total income taxes $ 186,938 $ 156,665 $ 170,945 In December 2023, the FASB amended income tax disclosure guidance to require enhanced transparency in the effective tax rate reconciliation and additional disclosures related to income taxes paid. We adopted this guidance for the year ended December 31, 2025 and applied the disclosure requirements retrospectively to all prior periods presented. The table below reflects those disclosures for the years ended December 31, 2025, 2024 and 2023. Year Ended December 31, 2025 2024 2023 (In thousands) Amount Rate Amount Rate Amount Rate Federal Statutory Tax Rate 153,255 21.0 % 141,838 21.0 % 148,807 21.0 % State and Local Income Taxes, net of federal tax effect (1) 27,298 3.7 % 20,224 3.0 % 26,047 3.7 % Foreign Tax Effects 3,501 0.5 % 3,651 0.5 % 4,156 0.5 % Tax Credits ( 737 ) ( 0.1 ) % 178 — % ( 1,001 ) ( 0.1 ) % Nontaxable or Nondeductible Items 4,019 0.6 % ( 8,126 ) ( 1.2 ) % ( 6,991 ) ( 1.0 ) % Excess tax benefits from stock-based compensation ( 1,060 ) ( 0.1 ) % ( 10,561 ) ( 1.6 ) % ( 7,412 ) ( 1.0 ) % Other 5,079 0.7 % 2,435 0.4 % 421 — % Changes in Unrecognized Tax Benefits ( 551 ) ( 0.1 ) % $ ( 1,084 ) ( 0.1 ) % 110 — % Other Adjustments 153 — % ( 16 ) — % ( 183 ) — % Effective Tax Rate $ 186,938 25.6 % $ 156,665 23.2 % $ 170,945 24.1 % (1) In 2025, state tax in California, Maryland, and Illinois comprise the majority of the tax effect in this category. In 2024, state tax in California, Texas, and Illinois comprise the majority of the tax effect in this category. In 2023, state tax in California and Texas comprise the majority of the tax effect in this category. The higher effective tax rate in 2025 was primarily due to a de crease in excess tax benefits recognized on the settlement of employee share-based awards . The effective tax rate for the year ended December 31, 2025 was higher than the federal statutory tax rate of 21% primarily due to state and foreign income taxes. The table below presents the income taxes paid, net of refunds received, by jurisdiction for the years ended December 31, 2025, 2024 and 2023. FORM 10-K 63 PART II Year Ended December 31, 2025 2024 2023 (In thousands) US Federal $ 95,956 $ — $ 57,000 US State and Local: California (1) 13,385 — — All Others 15,875 8,417 9,606 Total US Domestic $ 29,260 $ 8,417 $ 9,606 Foreign: Canada 13,528 10,975 14,399 All Others 1,321 1,428 2,724 Total Foreign $ 14,849 $ 12,403 $ 17,123 Total Income Tax Paid $ 140,065 $ 20,820 $ 83,729 (1) The blank cells indicate that the amount of income tax paid during the year is either immaterial or does not meet the 5% disaggregation threshold. Deferred taxes are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates. The tax effects of temporary differences and carryforwards that give rise to significant portions of deferred tax assets and liabilities consisted of the following: Years Ended December 31, 2025 2024 (In thousands) Inventories and cemetery property $ ( 191,122 ) $ ( 195,851 ) Deferred incremental direct selling costs ( 114,032 ) ( 110,305 ) Property and equipment ( 186,055 ) ( 146,121 ) Intangibles ( 217,144 ) ( 213,641 ) Deferred revenue on preneed funeral and cemetery contracts ( 71,128 ) ( 100,095 ) Other ( 7,167 ) ( 6,085 ) Deferred tax liabilities ( 786,648 ) ( 772,098 ) Loss and tax credit carryforwards 106,657 113,603 Accrued liabilities 92,319 115,515 Deferred tax assets 198,976 229,118 Less: valuation allowance ( 95,464 ) ( 99,325 ) Net deferred income tax liability $ ( 683,136 ) $ ( 642,305 ) Deferred tax assets and deferred income tax liabilities are recognized in our Consolidated Balance Sheet as follows: Years Ended December 31, 2025 2024 (In thousands) Non-current deferred tax assets - included in Deferred charges and other assets, net $ 7,897 $ 6,890 Non-current deferred tax liabilities - included in Deferred tax liability ( 691,033 ) ( 649,195 ) Net deferred income tax liability $ ( 683,136 ) $ ( 642,305 ) As of December 31, 2025, foreign withholding taxes have not been provided on the estimated $ 306.5 million of undistributed earnings and profits (E&P) of our foreign subsidiaries as we intend to permanently reinvest these foreign E&P in the respective businesses outside the U.S. However, if we were to repatriate such foreign E&P, the foreign withholding tax liability is estimated to be $ 15.8 million. Additionally, if we were to repatriate E&P in excess of our previously taxed income under the Tax Cuts and Jobs Act of 2017, such excess repatriation may cause us to incur an additional U.S. federal income tax of approximately $ 7.7 million related to our hybrid debt structure between Canada and the United States that was eliminated in 2022. 64 Service Corporation International PART II The following table summarizes the activity related to our gross unrecognized tax benefits from January 1, 2023 to December 31, 2025 (in thousands): Federal, State, and Foreign Tax (In thousands) Balance at December 31, 2022 $ 1,348 Reduction to tax positions related to prior years — Balance at December 31, 2023 $ 1,348 Reductions to tax positions due to lapse of statutes of limitations ( 1,348 ) Additions to tax positions related to prior years 834 Balance at December 31, 2024 $ 834 Reductions to tax positions due to lapse of statutes of limitations ( 400 ) Balance at December 31, 2025 $ 434 Our total unrecognized tax benefits that, if recognized, would affect our effective tax rates were $ 0.4 million, $ 0.8 million and $ 1.3 million as of December 31, 2025, 2024 and 2023, respectively. We include potential accrued interest and penalties related to unrecognized tax benefits within our income tax provision account. We have accrued $ 0.3 million, $ 0.4 million and $ 1.0 million for the payment of interest, net of tax benefits, and penalties as of December 31, 2025, 2024 and 2023, respectively. We recorded a decrease of interest and penalties of $ 0.1 million, $ 0.6 million and an increase of $ 0.1 million for years ended December 31, 2025, 2024 and 2023, respectively. To the extent interest and penalties are not assessed with respect to uncertain tax positions or the uncertainty of deductions in the future, amounts accrued will be reduced and reflected as a reduction of the overall income tax provision. We file income tax returns, including tax returns for our subsidiaries, with federal, state, local, and foreign jurisdictions. We consider the United States to be our most significant jurisdiction; however, all tax returns are subject to routine compliance review by the taxing authorities in the jurisdictions in which we file tax returns in the ordinary course of business. The federal statutes of limitations have expired for all tax years prior to 2022. Our 2022 federal income tax return is currently under audit by the IRS. Various state and foreign jurisdictions are auditing years 2020 through 2023. The outcome of each of these audits cannot be predicted at this time. Following the enactment of the new U.S. tax legislation, Public Law No. 119-21, on July 4, 2025, we adopted the relevant provisions during the third quarter of 2025, including those pertaining to bonus depreciation and interest expense. Consistent with our expectations, the adoption of these provisions did not have a material effect on our consolidated financial statements. Various subsidiaries have federal, state, and foreign loss carryforwards totaling $ 2.2 billion with expiration dates ranging through 2043. Such loss carryforwards will expire as follows: Federal State Foreign Total (In thousands) 2026 $ — $ 340,129 $ 942 $ 341,071 2027 — 189,417 966 190,383 2028 — 234,006 1,705 235,711 2029 — 190,895 661 191,556 Thereafter — 1,253,180 615 1,253,795 Total loss carryforwards $ — $ 2,207,627 $ 4,889 $ 2,212,516 In addition to the above loss carryforwards, we have $1.0 million of federal net operating loss carryforwards and $2.1 million of foreign alternative minimum tax credits, both of which can be carried forward indefinitely. In assessing the usefulness of deferred tax assets, we consider whether it is more likely than not that some portion or all of the net deferred tax assets will not be realized. The future realization of net deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. During 2025, we recorded a net $ 3.9 million decrease in our valuation allowance primarily driven by utilization and expiration of state net operating losses, along with legislative changes in certain states. The valuation allowances can be affected in future periods by changes to tax laws, changes to statutory tax rates, and changes in estimates of future taxable income . FORM 10-K 65 PART II At December 31, 2025, our loss and tax credit carryforward deferred tax assets and valuation allowances by jurisdiction are as follows (presented net of federal benefit). Federal State Foreign Total (In thousands) Loss and tax credit carryforwards $ 214 $ 102,515 $ 3,928 $ 106,657 Valuation allowance $ — $ 80,711 $ 14,753 $ 95,464 6. Debt The components of Debt are: Years Ended December 31, 2025 2024 (In thousands) 7.500% Senior Notes due April 2027 $ 136,924 $ 136,924 4.625% Senior Notes due December 2027 550,000 550,000 5.125% Senior Notes due June 2029 750,000 750,000 3.375% Senior Notes due August 2030 850,000 850,000 4.000% Senior Notes due May 2031 800,000 800,000 5.750% Senior Notes due October 2032 800,000 800,000 Term Loan due January 2028 — 641,250 Term Loan due November 2030 750,000 — Bank Credit Facility due January 2028 — 120,000 Bank Credit Facility due November 2030 255,000 — Corporate Headquarters Debt Facility due February 2037 54,766 — Obligations under finance leases 151,061 145,061 Mortgage notes and other debt, maturities through 2050 80,142 86,044 Unamortized debt issuance costs ( 38,076 ) ( 43,981 ) Total debt $ 5,139,817 $ 4,835,298 Less: Current maturities of long-term debt ( 56,847 ) ( 83,850 ) Total long-term debt $ 5,082,970 $ 4,751,448 Current maturities of debt at December 31, 2025 include amounts due under our term loan, mortgage notes and other debt, and finance leases within the next year as well as the portion of unamortized debt issuance costs expected to be recognized in the next twelve months. Approximately 79 % and 84 % of our total debt had a fixed interest rate at December 31, 2025 and 2024, respectively. The components of our weighted average interest rate are as follows: Years Ended December 31, 2025 2024 Fixed Debt 4.67 % 4.64 % Floating Debt 5.54 % 6.50 % Total Debt 4.85 % 4.93 % 66 Service Corporation International PART II The following table summarizes the aggregate maturities of our debt for the five years subsequent to December 31, 2025 and thereafter, excluding unamortized premiums and debt issuance costs (in thousands): 2026 $ 56,847 2027 736,928 2028 54,264 2029 814,320 2030 1,790,101 2031 and thereafter 1,687,357 Total debt maturities $ 5,139,817 Bank Credit Agreement In November 2025, we amended our $2.2 billion credit agreement due January 2028 to enter into a new $2.5 billion bank credit agreement due November 2030 with a syndicate of banks. The $2.5 billion bank credit agreement comprises a $ 1.75 billion Bank Credit Facility, including a sublimit of $100.0 million for letters of credit and a $ 750.0 million Term Loan, both due November 2030. At closing of the new agreement, there was a net $121.4 million increase in our outstanding Term Loan balance and a net $115.0 million decrease in our outstanding Bank Credit Facility balance. The bank credit agreement provides us with flexibility for working capital, if needed, and is guaranteed by a majority of our domestic subsidiaries. The subsidiary guaranty is a guaranty of payment of the outstanding amount of the total lending commitment, including letters of credit. The bank credit agreement contains a maximum leverage ratio financial covenant and certain dividend and share repurchase restrictions. As of December 31, 2025, we are in compliance with all of our debt covenants. At December 31, 2025, we issued $ 47.0 million of letters of credit and pay a quarterly fee on the unused commitment, which was 0.20 %. As of December 31, 2025, we have $ 1,448.0 million in borrowing capacity under the facility. As of December 31, 2024, we issued $ 39.0 million of letters of credit. Debt Issuances and Additions During the year ended December 31, 2025, we issued or added $ 1,115.6 million of debt including: • $685.0 million on our Bank Credit Facility due January 2028; • $189.5 million in proceeds from certain members of the syndicate of banks in our Term Loan; • $180.0 million on our Bank Credit Facility due November 2030; • $54.8 million on our Corporate Headquarters Debt Facility due February 2037; and • $6.3 million in proceeds from certain members of the syndicate of banks in our Bank Credit Facility. Net proceeds from newly issued debt during the year ended December 31, 2025 were used to pay down our Bank Credit Facility due January 2028, Term Loan due January 2028 and for general corporate purposes. These transactions resulted in additional debt issuance costs of $ 5.4 million. During the year ended December 31, 2024, we issued or added $ 1,451.1 million of debt including: • $800.0 million unsecured 5.75% Senior Notes due October 2032; • $ 645.0 million on our Bank Credit Facility due January 2028; and • $ 6.1 million in other debt. Net proceeds from newly issued debt during the year ended December 31, 2024 were used to pay down our Bank Credit Facility due January 2028 and for general corporate purposes. These transactions resulted in additional debt issuance costs of $ 14.3 million. Debt Extinguishments and Reductions During the year ended December 31, 2025, we made aggregate debt payments of $ 825.8 million for scheduled and early extinguishment payments including: • $ 575.0 million in aggregate principal of our Bank Credit Facility due January 2028; • $121.3 million in aggregate principal to certain members of our Bank Credit Facility; • $68.1 million in aggregate principal to certain members of our Term Loan; • $40.0 million in aggregate principal of our Bank Credit Facility due November 2030; • $ 12.7 million in aggregate principal of our Term Loan due January 2028; FORM 10-K 67 PART II • $0.1 million of premiums paid on early extinguishment of debt; and • $ 8.6 million in other debt. Certain of the above transactions resulted in the recognition of a loss of $0.5 million recorded in Losses on early extinguishment of debt, net in our Consolidated Statement of Operations for the year ended December 31, 2025. During the year ended December 31, 2024, we made aggregate debt payments of $ 1,340.0 million for scheduled and early extinguishment payments including: • $ 1,315.0 million in aggregate principal of our Bank Credit Facility due January 2028; • $ 16.9 million in aggregate principal of our Term Loan due January 2028; • $ 0.5 million in aggregate principal of our 7.5% Senior Notes due April 2027 repurchased in the open market; and • $ 7.6 million in other debt. Additional Debt Disclosures At both December 31, 2025 and 2024, we had deposits of $ 0.7 million, respectively, in restricted, interest-bearing accounts that were pledged as collateral for various credit instruments and commercial commitments. These deposits are included in Other current assets and Deferred charges and other assets, net in our Consolidated Balance Sheet. We had assets of approximately $ 74.3 million and $ 81.7 million pledged as collateral for the mortgage notes and other debt at December 31, 2025 and 2024, respectively. Cash interest payments for the three years ended December 31 were as follows (in thousands): Payments in 2025 $ 252,901 Payments in 2024 $ 241,673 Payments in 2023 $ 230,551 Expected c ash interest payments on our existing long-term debt for the five years subsequent to December 31, 2025 and thereafter are as follows (in thousands): Payments in 2026 $ 249,148 Payments in 2027 238,175 Payments in 2028 209,179 Payments in 2029 184,801 Payments in 2030 150,077 Payments in 2031 and thereafter 125,876 Total expected cash interest payments $ 1,157,256 7. Credit Risk and Fair Value of Financial Instruments Fair Value Estimates The fair value estimates of the following financial instruments have been determined using available market information and appropriate valuation methodologies. The carrying values of cash and cash equivalents, trade receivables, and trade payables approximate the fair values of those instruments due to the short-term nature of the instruments. The carrying values of receivables on preneed funeral and cemetery contracts approximate fair value as the terms and conditions of these contracts are comparable to our current contract offerings. 68 Service Corporation International PART II The fair value of our debt instruments was as follows: Years Ended December 31, 2025 2024 (In thousands) 7.500% Senior Notes due April 2027 $ 141,725 $ 140,615 4.625% Senior Notes due December 2027 549,417 536,052 5.125% Senior Notes due June 2029 755,040 728,430 3.375% Senior Notes due August 2030 796,815 745,612 4.000% Senior Notes due May 2031 763,592 712,640 5.750% Senior Notes due October 2032 815,416 778,752 Term Loan due January 2028 — 641,250 Term Loan due November 2030 750,000 — Bank Credit Facility due January 2028 — 120,000 Bank Credit Facility due November 2030 255,000 — Corporate Headquarters Debt Facility due February 2037 54,766 — Mortgage notes and other debt, maturities through 2050 80,762 85,574 Total fair value of debt instruments $ 4,962,533 $ 4,488,925 The fair values of our long-term, fixed rate loans were estimated using market prices for those loans, and therefore they are classified within Level 2 of the fair value measurements hierarchy. The Term Loan, Bank Credit Facility, Corporate Headquarters Debt Facility, and the mortgage notes and other debt are classified within Level 3 of the fair value measurements hierarchy. The fair values of these instruments have been estimated using discounted cash flow analysis based on our incremental borrowing rate for similar borrowing arrangements. An increase (decrease) in the inputs results in a directionally opposite change in the fair value of the instruments. Credit Risk Exposure Our cash deposits, some of which exceed insured limits, are distributed among various market and national banks in the jurisdictions in which we operate. In addition, we regularly invest excess cash in financial instruments that are not insured, such as commercial paper that is offered by corporations with quality credit ratings and money market funds and Eurodollar time deposits that are offered by a variety of reputable financial institutions. We believe that the credit risk associated with such instruments is minimal. We grant credit to customers in the normal course of business. The credit risk associated with our funeral, cemetery, and preneed funeral and preneed cemetery receivables due from customers is generally considered minimal because of the diversification of the customers served. Furthermore, bad debts have not been significant relative to the volume of deferred revenue. Customer payments on preneed funeral or preneed cemetery contracts that generally are either placed into state-regulated trusts or used to pay premiums on life insurance contracts generally do not subject us to collection risk. Insurance-funded contracts are subject to supervision by state insurance departments and are protected in the majority of states by insurance guaranty acts. 8. Leases Our leases principally relate to office, maintenance, and transportation equipment and funeral service real estate. The majority of our lease arrangements contain options to (i) purchase the property at fair value on the exercise date, (ii) purchase the property for a value determined at the inception of the lease, or (iii) renew the lease for the fair rental value at the end of the primary lease term. FORM 10-K 69 PART II Future lease payments for non-cancelable operating and finance leases as of December 31, 2025 were as follows: Operating Finance Total (In thousands) 2026 $ 10,403 $ 44,461 $ 54,864 2027 9,566 36,082 45,648 2028 7,918 27,822 35,740 2029 6,466 19,435 25,901 2030 5,183 12,199 17,382 2031 and thereafter 26,093 41,401 67,494 Total lease payments $ 65,629 $ 181,400 $ 247,029 Less: Interest ( 14,843 ) ( 30,339 ) ( 45,182 ) Present value of lease liabilities $ 50,786 $ 151,061 $ 201,847 The components of lease cost were as follows: Years Ended December 31, 2025 2024 2023 (In thousands) Amortization of leased assets $ 39,392 $ 37,421 $ 34,212 Interest on lease liabilities 8,150 7,266 4,795 Total finance lease cost 47,542 44,687 39,007 Operating lease cost 12,010 11,245 10,531 Variable lease cost 528 637 872 Total lease cost $ 60,080 $ 56,569 $ 50,410 Supplemental balance sheet information related to leases was as follows: Lease Type Balance Sheet Classification December 31, 2025 December 31, 2024 (In thousands) Operating lease right-of-use assets (1) Deferred charges and other assets $ 47,535 $ 50,113 Finance lease right-of-use assets (1) Property and equipment, net 145,319 140,094 Total right-of-use assets (1) $ 192,854 $ 190,207 Operating Accounts payable and accrued liabilities $ 8,201 $ 7,861 Finance Current maturities of long-term debt 37,167 34,816 Total current lease liabilities $ 45,368 $ 42,677 Operating Other liabilities 42,585 45,269 Finance Long-term debt 113,894 110,245 Total non-current lease liabilities 156,479 155,514 Total lease liabilities $ 201,847 $ 198,191 (1) Right-of-use assets are presented net of accumulated amortization. 70 Service Corporation International PART II The weighted-average life remaining and discount rates of our leases were as follows: December 31, 2025 December 31, 2024 Operating Finance Operating Finance Weighted-average remaining lease term (years) 10.2 6.2 10.6 6.1 Weighted-average discount rate 4.7 % 5.4 % 4.6 % 5.3 % Supplemental cash flow information related to leases was as follows: Years Ended December 31, 2025 2024 2023 (In thousands) Cash paid for amounts in the measurement of lease liabilities: Operating cash flows for operating leases $ 11,476 $ 11,181 $ 10,473 Operating cash flows for finance leases 8,150 7,371 5,191 Financing cash flows for finance leases 38,321 36,840 34,482 Total cash paid for amounts included in the measurement of lease liabilities $ 57,947 $ 55,392 $ 50,146 New finance leases 46,046 54,118 57,962 Finance lease renewals and extensions 3 443 829 Right-of-use assets obtained in exchange for finance lease liabilities $ 46,049 $ 54,561 $ 58,791 New operating leases 3,103 5,067 6,534 Operating lease renewals and extensions 4,208 4,081 2,985 Right-of-use assets obtained in exchange for operating lease liabilities $ 7,311 $ 9,148 $ 9,519 We have 80 operating leases where we are the lessor and the non-cancelable term is greater than one year, resulting in $ 3.6 million and $ 3.9 million in lease income for the years ended December 31, 2025, and 2024, respectively. We determine whether an arrangement is or contains a lease at the inception of the arrangement based on the terms of the arrangement. We lease retail space, office space, and land, and we are party to cellular agreements and land easements. The underlying assets of these lease agreements are buildings and land. We generally do not have sales-type leases, direct financing leases, or lease receivables. Certain of our agreements include variable rental income based on a percentage of sales over base contractual levels. Renewal options that can be cancelled by the lessees are not included in our disclosure of future lease income, which includes only the non-cancelable terms and fixed escalation provisions. Certain lease arrangements contain options to purchase the property at fair value at the conclusion of the lease term. Non-lease components are excluded from rental income disclosures. Future undiscounted lease income from operating leases where we are the lessor were as follows as of December 31, 2025 (in thousands): 2026 $ 3,317 2027 2,582 2028 2,265 2029 1,598 2030 880 2031 and thereafter 4,825 Total expected cash receipts $ 15,467 We own certain land, buildings, and improvements for the sole purpose of generating lease income. Property is recorded at cost, and depreciation is recognized ratably over the estimated useful lives of the various classes of assets. Buildings and improvements are depreciated over a period ranging from ten years to forty years. For these properties, we recorded depreciation expense of $ 0.4 million for the years ended December 31, 2025, 2024, and 2023. As of December 31, 2025, our Consolidated Balance Sheet includes land of $ 24.7 million, and buildings and improvements of $ 9.3 million, net of $ 2.7 million accumulated depreciation, related to the buildings and improvements. FORM 10-K 71 PART II 9. Commitments and Contingencies Insurance Loss Reserves We purchase various insurance products with high deductibles including: comprehensive general liability, morticians and cemetery professional liability, automobile liability, and workers’ compensation. The high-deductible insurance program means we are primarily self-insured for claims and associated costs and losses covered by these policies. As of December 31, 2025 and 2024, we had self-insurance reserves of $ 108.4 million and $ 105.8 million, respectively. Litigation and Regulatory Matters We are a party to various litigation and regulatory matters, investigations, and proceedings. Some of the more frequent routine litigations incidental to our business are based on operational claims and employment-related matters, including discrimination, harassment, and wage and hour laws and regulations. For each of our outstanding legal matters, we evaluate the merits of the case, our exposure to the matter, possible legal or settlement strategies, and the likelihood of an unfavorable outcome. We intend to vigorously defend ourselves in the matters described herein; however, if we determine that an unfavorable outcome is probable and can be reasonably estimated, or if we determine an amount for which we would be willing to settle the matter to avoid further costs and risk, we establish the necessary accruals. We hold certain insurance policies that may reduce cash outflows with respect to an adverse outcome of these matters. We accrue such insurance recoveries when they become probable of being paid and can be reasonably estimated. Unclaimed Property Audits We have received notices from auditors representing the unclaimed property departments of approximately forty states regarding the escheatment of preneed trust funds held in association with unused preneed funeral and cemetery contracts ("Unused Preneed Trust Funds"). The states claim that these Unused Preneed Trust Funds are subject to the states’ unclaimed property or escheatment laws and generally assert that all or a portion of the Unused Preneed Trust Funds are escheatable if the beneficiary and/or purchaser is deceased or presumed deceased and no services or merchandise have been provided. We received notice that no additional property is due to be reported for the states of Alabama, Connecticut, Iowa, Kentucky, Maryland, Massachusetts, Montana, Nebraska, Nevada, New Mexico, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Texas, West Virginia, and Wyoming. We consider the unclaimed property audits resolved in those nineteen states. We have entered into an audit resolution agreement with the State of Florida Department of Financial Services and Division of Unclaimed Property ("Florida Agreement"). The Florida Agreement provides for us to retain the trust fund earnings and to escheat the principal to the State of Florida, which resulted in an increase in trust fund income in 2023, 2024 and 2025. We have reserved all of our rights, claims, and defenses. Given the nature of these matters, we are unable to reasonably estimate the total possible loss or ranges of loss, if any. 10. Equity (All shares reported in whole numbers) Share Authorization We are authorized to issue 1,000,000 shares of preferred stock, $1 per share par value. No preferred shares were issued as of December 31, 2025 or 2024. At December 31, 2025 and 2024, 500,000,000 common shares of $ 1 par value were authorized. We had 141,957,004 and 146,668,589 shares issued and 139,678,199 and 144,694,887 outstanding at par at December 31, 2025 and 2024, respectively. Accumulated Other Comprehensive Income The assets and liabilities of foreign operations are translated into U.S. dollars using the current exchange rate. The U.S. dollar amount that arises from such translation, as well as exchange gains and losses on intercompany balances of a long-term investment nature, are included in the cumulative currency translation adjustments in Accumulated other comprehensive income. Share Repurchase Program Subject to market conditions, normal trading restrictions, and limitations in our debt covenants, we may make purchases in the open market or through privately negotiated transactions under our share repurchase program. In 2025, we repurchased 5,864,563 shares of our common stock at an aggregate cost of $ 464.2 million, which is an average cost per share of $ 79.15 . In 2024, we repurchased 3,439,551 shares of our common stock at an aggregate cost of $ 249.8 million, which is an average cost per share of $ 72.63 . In May 2025, our Board of Directors increased our share repurchase authorization to $ 600.0 million. After these repurchases and the increase in authorization, the remaining dollar value of shares authorized to be purchased under the share repurchase program was $ 356.7 million at December 31, 2025. Subsequent to December 31, 2025, we repurchased 552,313 shares for $ 44.4 million at an average cost per share of $ 80.48 . 72 Service Corporation International PART II 11. Share-Based Compensation Stock Benefit Plans We maintain benefit plans whereby shares of our common stock may be issued pursuant to the exercise of stock options or restricted stock granted to officers and key associates. Our Amended and Restated Incentive Plan ("the 1996 Plan") reserved 44,000,000 shares of our common stock for outstanding and future awards of stock options, restricted stock, and other share-based awards to officers and key associates. In May 2017, our shareholders approved the amended 2016 Equity Incentive Plan ("the 2016 Plan"), which reserved 13,404,404 shares of common stock for outstanding and future awards of stock options, restricted stock, and other awards to officers and key associates. Our benefit plans allow for options to be granted as either non-qualified or incentive stock options. The options historically have been granted annually, or upon hire, as approved by the Compensation Committee of the Board of Directors. The options are granted with an exercise price equal to the market price of our common stock on the date of the grant, as approved by the Compensation Committee of the Board of Directors. The options are generally exercisable at a rate of 33 1 / 3 % each year unless alternative vesting methods are approved by the Compensation Committee of the Board of Directors. Outstanding options will expire, if not exercised or forfeited, within eight years from the date of grant. Restricted shares are generally expensed ratably over the period during which the restrictions lapse, which is typically 33 1 / 3 % each year. At December 31, 2025 and 2024, 2,255,668 and 2,821,617 shares, respectively, were reserved for future option and restricted share grants under our stock benefit plans. We utilize the Black-Scholes option valuation model for estimating the fair value of our stock options. This model allows the use of a range of assumptions related to volatility, risk-free interest rate, expected holding period, and dividend yield. The expected volatility utilized in the valuation model is based on the historical volatility of our stock price. The dividend yield and expected holding period are based on historical experience and management’s estimate of future events. The risk-free interest rate is derived from the U.S. Treasury yield curve based on the expected life of the option in effect at the time of grant. The fair values of our stock options are calculated using the following weighted average assumptions, based on the methods described above: Years Ended December 31, Assumptions 2025 2024 2023 Dividend yield 1.7 % 1.8 % 1.6 % Expected volatility 25.4 % 25.7 % 25.4 % Risk-free interest rate 4.3 % 4.3 % 4.0 % Expected holding period (years) 5.0 4.8 4.5 The following table summarizes certain information with respect to stock option and restricted share compensation included in our Consolidated Statement of Operations: Years Ended December 31, 2025 2024 2023 (In thousands) Pretax employee share-based compensation expense included in net income $ 15,923 $ 17,163 $ 15,423 Pretax director share-based compensation expense included in net income $ 1,710 $ 1,620 $ 1,620 Total pretax share-based compensation expense included in net income $ 17,633 $ 18,783 $ 17,043 Income tax benefit related to share-based compensation included in net income $ 4,459 $ 4,358 $ 4,224 Stock Options The following table sets forth stock option activity for the year ended December 31, 2025 (shares reported in whole numbers): Options Weighted-Average Exercise Price Outstanding at December 31, 2024 3,643,548 $ 53.00 Granted 327,963 $ 78.57 Exercised ( 704,448 ) $ 41.74 Outstanding at December 31, 2025 3,267,063 $ 57.99 Exercisable at December 31, 2025 2,589,716 $ 53.75 The aggregate intrinsic value for stock options outstanding and exercisable was $ 65.5 million and $ 62.7 million, respectively, at December 31, 2025. FORM 10-K 73 PART II Set forth below is certain information related to stock options outstanding and exercisable at December 31, 2025 (shares reported in whole numbers): Options Outstanding Options Exercisable Range of Exercise Price Number Outstanding at December 31, 2025 Weighted-Average Remaining Contractual Life (in years) Weighted- Average Exercise Price Number Exercisable at December 31, 2025 Weighted- Average Exercise Price $35.01 — 45.00 467,588 1.0 $ 42.01 467,588 $ 42.01 $45.01 — 55.00 1,199,319 2.6 $ 50.27 1,199,319 $ 50.27 $55.01 — 65.00 527,703 4.1 $ 59.76 527,703 $ 59.76 $65.01 — 75.00 744,490 5.6 $ 70.16 395,106 $ 70.21 $75.01 — 85.00 327,963 7.1 $ 78.57 — $ — $0.00 — 85.00 3,267,063 3.8 $ 57.99 2,589,716 $ 53.75 Other information pertaining to stock options was as follows (in thousands, except weighted-average grant date fair value): Years Ended December 31, 2025 2024 2023 Weighted average grant-date fair value of stock options granted $ 20.04 $ 17.28 $ 16.86 Total fair value of stock options vested $ 5,720 $ 6,485 $ 6,059 Total intrinsic value of stock options exercised $ 27,855 $ 70,019 $ 37,115 Cash received from the exercise of stock options $ 29,401 $ 56,683 $ 24,181 Recognized compensation expense $ 6,076 $ 6,701 $ 5,929 As of December 31, 2025, the unrecognized compensation expense related to stock options of $ 7.2 million is expected to be recognized over a weighted average period of 1.7 years. Restricted Shares The fair value of our restricted share awards and units, as determined on the grant date, is being amortized and charged to income (with an offsetting credit to Capital in excess of par value ) generally over the average period during which the restrictions lapse. Restricted share award activity was as follows (share awards reported in whole numbers): Restricted Share Awards Weighted-Average Grant-Date Fair Value Nonvested restricted share awards at December 31, 2024 174,989 $ 68.41 Granted 85,627 $ 78.57 Vested ( 86,841 ) $ 66.70 Nonvested restricted share awards at December 31, 2025 173,775 $ 74.27 Other information pertaining to restricted share awards was as follows (in thousands, except weighted-average grant date fair value): Years Ended December 31, 2025 2024 2023 Recognized compensation expense related to restricted share awards $ 6,209 $ 6,743 $ 6,128 Weighted-average grant date fair value for nonvested restricted stock granted $ 78.57 $ 69.98 $ 70.34 Total fair market value of restricted share awards vested $ 5,792 $ 6,687 $ 6,130 Aggregate intrinsic value of restricted share awards vested $ 1,006 $ 2,155 $ 1,715 At December 31, 2025, unrecognized compensation expense of $ 7.7 million related to restricted share awards is expected to be recognized over a weighted average period of 1.8 years. 74 Service Corporation International PART II Restricted share units activity was as follows (share units reported in whole numbers): Restricted Share Units Weighted-Average Grant-Date Fair Value Nonvested restricted share units at December 31, 2024 103,954 $ 68.42 Granted 54,344 $ 78.57 Vested ( 51,573 ) $ 66.73 Forfeited and other ( 3,940 ) $ 74.28 Nonvested restricted share units at December 31, 2025 102,785 $ 74.41 Other information pertaining to restricted share units was as follows (in thousands, except weighted-average grant date fair value): Years Ended December 31, 2025 2024 2023 Recognized compensation expense related to restricted share units $ 3,637 $ 3,720 $ 3,366 Weighted-average grant date fair value for nonvested restricted share units granted $ 78.57 $ 69.98 $ 70.34 Total fair market value of restricted share units vested $ 3,441 $ 3,634 $ 3,221 Aggregate intrinsic value of restricted share units vested $ 596 $ 1,188 $ 1,000 At December 31, 2025, the unrecognized compensation expense related to restricted share units of $ 4.5 million is expected to be recognized over a weighted average period of 1.8 years. Performance Units During 2025, 2024, and 2023, we granted 84,004 , 96,761 and 88,084 performance units, respectively. At December 31, 2025, there were 277,806 performance units outstanding. Total compensation expense for performance units was $ 6.4 million, $ 10.8 million, and $ 11.8 million for the years ended December 31, 2025, 2024, and 2023, respectively. For the year ended December 31, 2025 and 2024, cash paid to settle performance units was $ 10.3 million and $ 15.9 million, respectively. The fair value of the liability for these awards is calculated using a Monte Carlo simulation. The weighted average key assumptions as of December 31, 2025 were as follows: Share price at beginning of performance period $ 72.23 Risk-free interest rate 3.48 % Expected volatility 22.2 % Fair value of share-based performance units outstanding $ 77.96 At December 31, 2025, the unrecognized compensation expense related to performance units of $ 6.6 million is expected to be recognized over a weighted average period of 1.4 years. 12. Retirement Plans We currently have a supplemental retirement plan for certain current and former key employees (SERP), a supplemental retirement plan for officers and certain key employees (Senior SERP), and a Stewart Supplemental Retirement Plan (collectively, the “Plans”). All of our Plans are unfunded and have a measurement date of December 31. The Plans are frozen; therefore, the participants do not earn incremental benefits from additional years of service, and we do not incur any additional service cost. Retirement benefits under the SERP are based on years of service and average monthly compensation, reduced by benefits under Social Security. The Senior SERP provides retirement benefits based on years of service and position. We recognize pension related gains and losses in Other income, net on our Consolidated Statement of Operations in the year such gains and losses are incurred. The components of the Plans’ net periodic benefit cost were as follows: Years Ended December 31, 2025 2024 2023 (In thousands) Interest cost on projected benefit obligation $ 678 $ 674 $ 797 Recognized net actuarial (gain) loss ( 154 ) ( 995 ) 654 Total net periodic benefit (gain) cost $ 524 $ ( 321 ) $ 1,451 FORM 10-K 75 PART II The Plans’ funded status were as follows: Years Ended December 31, 2025 2024 (In thousands) Change in Benefit Obligation: Benefit obligation at beginning of year $ 13,332 $ 15,363 Interest cost 678 674 Actuarial gain ( 154 ) ( 995 ) Benefits paid ( 1,572 ) ( 1,710 ) Benefit obligation at end of year $ 12,284 $ 13,332 Change in Plan Assets: Fair value of plan assets at beginning of year $ — $ — Employer contributions 1,572 1,710 Benefits paid, including expenses ( 1,572 ) ( 1,710 ) Fair value of plan assets at end of year $ — $ — Funded status of plan $ ( 12,284 ) $ ( 13,332 ) Funding Summary: Projected benefit obligation $ 12,284 $ 13,332 Accumulated benefit obligation $ 12,284 $ 13,332 Amounts Recognized in the Consolidated Balance Sheet: Included in Accounts payable and accrued liabilities $ ( 1,518 ) $ ( 1,825 ) Included in Other liabilities ( 10,766 ) ( 11,507 ) Total accrued liability $ ( 12,284 ) $ ( 13,332 ) The retirement benefits under the Plans are unfunded obligations of the Company. We have purchased various life insurance policies on certain participants in the Plans with the intent to use the proceeds or any cash value buildup from these policies to assist in meeting, at least to the extent of such assets, the Plans' funding requirements. The face value of these insurance policies at December 31, 2025 and 2024 was $ 37.7 million and $ 37.1 million, respectively, and the cash surrender value was $ 30.8 million and $ 30.1 million, respectively. The outstan ding loans against the policies are minimal and there are no restrictions in the policies regarding loans. The Plans’ weighted-average assumptions used to determine the benefit obligation and net periodic benefit cost are as follows: Years Ended December 31, 2025 2024 2023 Weighted-average discount rate used to determine obligations 4.97 % 5.41 % 4.94 % Weighted-average discount rate used to determine net periodic benefit cost 5.37 % 4.94 % 5.34 % We determine our discount rate used to compute future benefit obligations using an analysis of expected future benefit payments. The reasonableness of our discount rate is verified by comparing the rate to the rate earned on high-quality fixed income investments, such as the Moody’s Aa index, plus 50 basis points. The assumed rate of return on plan assets was not applicable as we pay plan benefits as they come due. As all Plans are frozen, the assumed rate of compensation increase is zero . 76 Service Corporation International PART II The following benefit payments are expected to be paid over the next ten years related to our Plans (in thousands): 2026 $ 1,518 2027 1,453 2028 1,384 2029 1,286 2030 1,230 Years 2031 through 2035 5,413 Total expected benefit payments $ 12,284 We also have an employee savings plan that qualifies under Section 401(k) of the Internal Revenue Code for the exclusive benefit of our United States employees. Under the plan, participating employees may contribute a portion of their pretax and/or after-tax income in accordance with specified guidelines up to a maximum of 50 %. During 2025, 2024, and 2023, we matched a percentage of the employee contributions through contributions of cash. For these years, our matching contribution was based upon the following: Years of Vesting Service Percentage of Deferred Compensation 0 — 5 years 75% of the first 6% of deferred compensation 6 — 10 years 100% of the first 6% of deferred compensation 11 or more years 125% of the first 6% of deferred compensation The amount of our matched contributions in 2025, 2024, and 2023 was $ 56.2 million, $ 54.5 million, and $ 52.8 million, respectively. 13. Segment Reporting Our operations are both product-based and geography-based, and the reportable and operating segments presented below include our funeral and cemetery operations. Our geographic areas include the United States and Canada, where we conduct both funeral and cemetery operations. Our Chief Operating Decision Maker (CODM) is our Chief Executive Officer, who is responsible for making key operating, finance, and capital allocation decisions and specifically uses segment gross profit to aid in the decision making and to assess the performance of the operating segments. Our reportable segment information, including disaggregated revenue, was as follows and includes a reconciliation of gross profit to our consolidated income before income taxes. FORM 10-K 77 PART II Years Ended December 31, 2025 2024 2023 (In thousands) Funeral revenue: Atneed revenue $ 1,209,585 $ 1,185,801 $ 1,185,413 Matured preneed revenue 769,136 725,810 715,298 Core funeral revenue 1,978,721 1,911,611 1,900,711 Non-funeral home revenue 107,630 94,763 85,904 Non-funeral home preneed sales revenue 93,195 104,763 134,770 Core general agency and other revenue 225,984 213,063 181,646 Total funeral revenue 2,405,530 2,324,200 2,303,031 Direct cost ( 344,053 ) ( 344,133 ) ( 351,327 ) Selling compensation ( 192,129 ) ( 177,887 ) ( 173,430 ) Salaries & fringe expense ( 670,790 ) ( 653,753 ) ( 636,763 ) Facility expenses ( 272,295 ) ( 258,556 ) ( 240,553 ) Other costs and overhead ( 430,496 ) ( 424,609 ) ( 403,852 ) Total funeral expense ( 1,909,763 ) ( 1,858,938 ) ( 1,805,925 ) Funeral gross profit $ 495,767 $ 465,262 $ 497,106 Cemetery revenue: Atneed revenue 435,682 431,966 433,925 Recognized preneed property revenue 896,166 892,657 874,724 Recognized preneed merchandise and services revenue 421,696 402,972 365,018 Core cemetery revenue 1,753,544 1,727,595 1,673,667 Other revenue 150,160 134,584 123,080 Total cemetery revenue 1,903,704 1,862,179 1,796,747 Direct cost ( 252,144 ) ( 258,339 ) ( 261,826 ) Selling compensation ( 344,764 ) ( 329,080 ) ( 327,154 ) Maintenance expense ( 267,668 ) ( 261,570 ) ( 247,790 ) Other costs and overhead ( 394,821 ) ( 387,795 ) ( 365,276 ) Total cemetery expense ( 1,259,397 ) ( 1,236,784 ) ( 1,202,046 ) Cemetery gross profit $ 644,307 $ 625,395 $ 594,701 Total revenue from customers 4,309,234 4,186,379 4,099,778 Total segment expenses ( 3,169,160 ) ( 3,095,722 ) ( 3,007,971 ) Gross profit from reportable segments 1,140,074 1,090,657 1,091,807 Corporate general and administrative expenses ( 166,158 ) ( 139,019 ) ( 157,368 ) Restructuring charge ( 1,980 ) ( 11,470 ) — Gains (loss) on divestitures and impairment charges, net 6,151 ( 12,488 ) 9,816 Operating income 978,087 927,680 944,255 Interest expense ( 255,372 ) ( 257,771 ) ( 239,447 ) Losses on early extinguishment of debt, net ( 523 ) ( 25 ) ( 1,114 ) Other income, net 7,591 5,534 4,912 Income before income taxes $ 729,783 $ 675,418 $ 708,606 78 Service Corporation International PART II Other reportable segment information as of and for the year ended December 31 was as follows: Reportable Segments Total Funeral Cemetery Segments Corporate Consolidated (In thousands) 2025 Interest expense $ 7,810 $ 1,104 $ 8,914 $ 246,458 $ 255,372 Depreciation and amortization $ 153,928 $ 55,733 $ 209,661 $ 9,993 $ 219,654 Amortization of intangibles $ 10,082 $ 6,285 $ 16,367 $ 3 $ 16,370 Amortization of cemetery property $ — $ 104,262 $ 104,262 $ — $ 104,262 Capital expenditures $ 151,208 $ 234,498 $ 385,706 $ 2,847 $ 388,553 Total assets $ 7,296,780 $ 10,690,258 $ 17,987,038 $ 667,474 $ 18,654,512 2024 Interest expense $ 4,073 $ 893 $ 4,966 $ 252,805 $ 257,771 Depreciation and amortization $ 145,759 $ 51,254 $ 197,013 $ 11,198 $ 208,211 Amortization of intangibles $ 10,544 $ 6,670 $ 17,214 $ 8 $ 17,222 Amortization of cemetery property $ — $ 102,510 $ 102,510 $ — $ 102,510 Capital expenditures $ 134,210 $ 231,712 $ 365,922 $ 7,737 $ 373,659 Total assets $ 6,996,897 $ 9,868,033 $ 16,864,930 $ 514,508 $ 17,379,438 2023 Interest expense $ 2,092 $ 764 $ 2,856 $ 236,591 $ 239,447 Depreciation and amortization $ 133,544 $ 46,713 $ 180,257 $ 11,015 $ 191,272 Amortization of intangibles $ 12,025 $ 6,706 $ 18,731 $ 5 $ 18,736 Amortization of cemetery property $ — $ 101,234 $ 101,234 $ — $ 101,234 Capital expenditures $ 125,922 $ 212,406 $ 338,328 $ 23,465 $ 361,793 Our geographic area information as of and for the year ended December 31 was as follows: United States Canada Total (In thousands) 2025 Revenue from external customers $ 4,095,100 $ 214,134 $ 4,309,234 Interest expense $ 254,984 $ 388 $ 255,372 Depreciation and amortization $ 207,148 $ 12,506 $ 219,654 Amortization of intangibles $ 16,162 $ 208 $ 16,370 Amortization of cemetery property $ 100,976 $ 3,286 $ 104,262 Operating income $ 924,706 $ 53,381 $ 978,087 Gain on divestitures and impairment charges, net $ 6,046 $ 105 $ 6,151 Long-lived assets $ 8,122,372 $ 360,941 $ 8,483,313 2024 Revenue from external customers $ 3,967,573 $ 218,806 $ 4,186,379 Interest expense $ 257,383 $ 388 $ 257,771 Depreciation and amortization $ 196,281 $ 11,930 $ 208,211 Amortization of intangibles $ 16,996 $ 226 $ 17,222 Amortization of cemetery property $ 98,610 $ 3,900 $ 102,510 Operating income $ 871,760 $ 55,920 $ 927,680 (Loss) gain on divestitures and impairment charges, net $ ( 13,471 ) $ 983 $ ( 12,488 ) Long-lived assets $ 7,786,598 $ 322,146 $ 8,108,744 2023 Revenue from external customers $ 3,881,333 $ 218,445 $ 4,099,778 Interest expense $ 239,103 $ 344 $ 239,447 Depreciation and amortization $ 180,093 $ 11,179 $ 191,272 Amortization of intangibles $ 18,495 $ 241 $ 18,736 Amortization of cemetery property $ 97,471 $ 3,763 $ 101,234 Operating income $ 887,110 $ 57,145 $ 944,255 Gain on divestitures and impairment charges, net $ 8,512 $ 1,304 $ 9,816 FORM 10-K 79 PART II 14. Supplementary Information The detail of certain balance sheet accounts is as follows: Years Ended December 31, 2025 2024 (In thousands) Cash and cash equivalents: Cash $ 159,418 $ 142,386 Commercial paper and temporary investments 84,163 76,380 $ 243,581 $ 218,766 Other current assets: Income tax receivable $ 4,999 $ 3,775 Prepaid insurance 4,536 4,824 Prepaid expenses 15,891 15,827 Restricted cash 2,231 2,000 Other 4,894 4,479 $ 32,551 $ 30,905 Cemetery property: Undeveloped land $ 1,420,619 $ 1,380,619 Developed lots, lawn crypts, mausoleum spaces, cremation niches, and cremation memorialization property 781,348 748,785 $ 2,201,967 $ 2,129,404 Property and equipment, net: Land $ 812,786 $ 793,520 Buildings and improvements 3,049,390 2,803,194 Operating equipment 890,779 893,074 Leasehold improvements 52,170 51,479 Finance leases 351,881 339,999 5,157,006 4,881,266 Less: Accumulated depreciation ( 2,198,683 ) ( 2,100,292 ) Less: Accumulated amortization of finance leases ( 206,562 ) ( 199,905 ) $ 2,751,761 $ 2,581,069 Deferred charges and other assets: Intangible assets, net $ 473,574 $ 512,382 Restricted cash 656 633 Deferred tax assets 7,897 6,890 Notes receivable, net of reserves of $1,952 and $1,796, respectively 7,067 8,293 Cash surrender value of insurance policies 260,068 244,439 Deferred incremental direct selling costs 448,011 430,262 Operating leases 47,535 50,113 Other 115,722 64,244 $ 1,360,530 $ 1,317,256 80 Service Corporation International PART II Years Ended December 31, 2025 2024 (In thousands) Accounts payable and accrued liabilities: Accounts payable $ 233,926 $ 203,344 Accrued benefits 143,457 144,450 Accrued interest 33,924 36,710 Accrued property taxes 14,897 15,319 Self-insurance reserves 108,448 105,775 Legal reserves 19,049 13,795 Bank overdrafts 26,169 30,173 Operating leases 8,201 7,861 Other accrued liabilities 97,085 81,847 $ 685,156 $ 639,274 Other liabilities: Accrued benefit costs $ 10,766 $ 11,507 Deferred compensation 236,003 223,948 Customer refund obligation reserve 34,252 35,354 Tax liability 684 1,235 Payable to perpetual care trust 207,459 171,977 Operating leases 42,585 45,269 Other 19,044 24,190 $ 550,793 $ 513,480 Certain Non-Cash Investing and Financing Transactions Years Ended December 31, 2025 2024 2023 (In thousands) Net change in capital expenditure accrual $ ( 6,650 ) $ 2,185 $ 9,171 Excise tax accrual on shares repurchased $ 4,279 $ 754 $ 4,724 FORM 10-K 81 PART II 15. Earnings Per Share Basic earnings per common share (EPS) excludes dilution and is computed by dividing Net income attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other obligations to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that shared in our earnings. A reconciliation of the numerators and denominators of basic and diluted EPS is presented below: Years Ended December 31, 2025 2024 2023 (In thousands, except per share amounts) Amounts attributable to common stockholders: Net income — basic and diluted $ 542,614 $ 518,648 $ 537,317 Weighted average shares: Weighted average shares — basic 141,603 145,271 150,565 Stock options 1,025 1,444 1,726 Restricted share units 61 67 60 Weighted average shares — diluted 142,689 146,782 152,351 Amounts attributable to common stockholders: Net income per share: Basic $ 3.83 $ 3.57 $ 3.57 Diluted $ 3.80 $ 3.53 $ 3.53 The computation of diluted earnings per share excludes outstanding stock options in certain periods in which the inclusion of such options would be antidilutive to the periods presented. Total antidilutive options not currently included in the computation of dilutive EPS are as follows (in shares): Years Ended December 31, 2025 2024 2023 (In thousands) Antidilutive options 638 709 845 82 Service Corporation International PART II 16. Acquisitions and Divestiture-Related Activities Acquisitions We spent $ 101.7 million and $ 182.9 million for several business acquisitions during the twelve months ended December 31, 2025 and 2024, respectively. This includes $0.4 million and $1.7 million of cash acquired in 2025 and 2024, respectively. In addition, we spent $ 18.5 million and $ 62.1 million for several real estate acquisitions during the twelve months ended December 31, 2025 and 2024, respectively. In the third quarter of 2024, we acquired 10 funeral homes and 2 cemeteries. This includes two separate acquisitions in major metropolitan markets for $ 120.6 million in cash in the third quarter. The primary reasons for the acquisitions and the principal factors that contributed to the recognition of goodwill in these acquisitions were: • the acquisitions enhance our network footprint, enabling us to serve a number of new, complementary areas; and • the acquisitions of the preneed backlog of deferred revenues enhance our long-term stability. The following table summarizes the fair values of the assets acquired and liabilities assumed in the two separate acquisitions during the year ended 2024 after measurement period adjustments (in thousands): Other current assets $ 2,201 Cemetery property 2,143 Property and equipment, net 51,259 Preneed receivables, net and trust investments 41,018 Deferred charges and other assets 340 Cemetery perpetual care trust investments 9,223 Goodwill 97,768 Total assets acquired 203,952 Current liabilities 2,369 Deferred revenue and deferred receipts held in trust 55,806 Long-term debt 15,431 Care trusts' corpus 9,223 Other liabilities 476 Total liabilities assumed 83,305 Net assets acquired $ 120,647 Goodwill and land recorded in the acquisitions are not subject to amortization; however, the goodwill will be tested periodically for impairment. Of the $ 97.8 million in recognized goodwill, $ 77.9 million is deductible for tax purposes. Of this total, $ 34.0 million was allocated to our cemetery segment, while $ 63.8 million was allocated to our funeral segment. Divestiture-Related Activities As divestitures occur in the normal course of business, gains or losses on the sale of such locations are recognized in the Consolidated Statement of Operations line item G ains (losses) on divestitures and impairment charges, net , which consist of the following: Years Ended December 31, 2025 2024 2023 (In thousands) Gains on divestitures, net $ 9,551 $ 11,337 $ 12,543 Impairment losses ( 3,400 ) ( 23,825 ) ( 2,727 ) Gains (losses) on divestitures and impairment charges, net $ 6,151 $ ( 12,488 ) $ 9,816 FORM 10-K 83 PART II Service Corporation International Schedule II - Valuation and Qualifying Accounts Three Years Ended December 31, 2025 Description Balance at Beginning of Period Charged (Credited) to Costs and Expenses Charged (Credited) to Write-offs & Other Accounts Balance at End of Period (In thousands) Current Provision: Reserve for credit losses: Year Ended December 31, 2025 $ 4,040 $ 5,796 $ ( 5,892 ) $ 3,944 Year Ended December 31, 2024 $ 4,382 $ 5,111 $ ( 5,453 ) $ 4,040 Year Ended December 31, 2023 $ 6,186 $ 3,764 $ ( 5,568 ) $ 4,382 Due After One Year: Reserve for credit losses: Year Ended December 31, 2025 $ 2,367 $ 87 $ 6 $ 2,460 Year Ended December 31, 2024 $ 2,345 $ — $ 22 $ 2,367 Year Ended December 31, 2023 $ 3,602 $ ( 510 ) $ ( 747 ) $ 2,345 Preneed Receivables, Net: Reserve for credit losses: Year Ended December 31, 2025 $ 35,857 $ 3,011 $ ( 4,188 ) $ 34,680 Year Ended December 31, 2024 $ 32,475 $ 6,431 $ ( 3,049 ) $ 35,857 Year Ended December 31, 2023 $ 27,314 $ 7,991 $ ( 2,830 ) $ 32,475 Deferred Tax Valuation Allowance: Year Ended December 31, 2025 $ 99,325 $ ( 3,861 ) $ — $ 95,464 Year Ended December 31, 2024 $ 108,834 $ ( 9,509 ) $ — $ 99,325 Year Ended December 31, 2023 $ 118,939 $ ( 10,105 ) $ — $ 108,834 84 Service Corporation International PART II Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure None.