TAP Molson Coors Beverage Co - 10-K

ITEM 1A.    RISK FACTORS

Investing in our Company involves risk. Investors should carefully consider the following risk factors and the other information contained within this report. The risks set forth below are those that management believes are most likely to have a material adverse effect on us. Investors are encouraged to read each risk factor as related and interconnected to the other risk factors set forth in this section. However, the risks set forth below are not a comprehensive description of the risks facing our Company. We may also be subject to other risks or uncertainties not presently known to us or that we currently deem to be immaterial but may materially adversely affect our business, financial condition or results of operations in future periods. Investors should not interpret the disclosure of any risk factor to imply that the risk has not already materialized. If the following risks or uncertainties, individually or in combination, actually occur, they may have a material adverse effect on our business, financial conditions, results of operations or prospects. See also "Cautionary Statement Pursuant to Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995."

Risks Related to our Company and Operations

The global beer industry and the broader alcohol industry are constantly evolving and our position within these industries and the success of our products in our markets may fundamentally change. If we do not successfully transform along with the evolving industries, market dynamics and consumer preferences, our business and financial results could be materially adversely affected.  The brewing industry has significantly evolved over the years becoming an increasingly consolidated global beer market. For many years, the industry operated primarily on local presence with modest international expansion achieved through export, license and partnership arrangements. In contrast, it has now become increasingly complex and competitive as the consolidation of brewers has resulted in fewer major market participants. As a result, the markets in which we operate, particularly the more mature markets, like the U.S., Canada and the U.K., may evolve at a disadvantage to our current market position. Ongoing evolution in certain of our beer markets, together with emerging changes in consumer preferences, have resulted in a significant increase in market entrants, new and innovative products, consumer choices and market competition.

Our Coors Light and Miller Lite brands in the Americas represented approximately 55% of segment net sales in 2025 while, Carling, Staropramen, Coors, Madrí Excepcional, Ožujsko , and Bergenbier brands in EMEA&APAC represented approximately 45% of segment net sales in 2025, with several of our other brands representing a significant share of their respective markets. Therefore, continued volatility in these markets could disproportionately impact the performance of these brands. Consequently, any material shift in consumer preferences away from these brands, or from the categories in which they compete, could have a material adverse effect on our business and financial results.

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Furthermore, the broader alcohol industry is also experiencing a shift in consumer drinking preferences and behaviors due to, among others, downturns in economic conditions or perceived value, changing demographics and taste preferences, such as the expansion in above premium products, specifically flavored malt beverages, RTDs, spirit-based beverages, cider and other similar beverages, as well as a shift toward non-alcoholic beverages, health and wellness trends (including the use of glucagon-like peptide (GLP-1) agonists), as well as changes in consumers' perception of our brands and the brands of our competitors. If we are unsuccessful in evolving with, and navigating through, these changes to the markets in which we operate, there could be a material adverse effect on our business and financial results. If our competitors are able to respond more quickly to the evolving trends within beverage categories, or if our new products in these categories are not successful, our business and financial results may be adversely impacted.

Our restructuring activities may not be successful and the estimated costs associated with such activities may be more than expected, and our restructuring activities may adversely impact employee hiring and retention. On October 20, 2025, we announced a corporate restructuring plan, the Americas Restructuring Plan, designed to create a leaner, more agile Americas organization while advancing our ability to reinvest in our business and position us for future growth. The restructuring involved the elimination of salaried positions across our Americas segment during the fourth quarter of 2025. The implementation of this plan may be disruptive to our operations, result in higher than anticipated restructuring charges, including severance and related costs, and otherwise adversely affect our results of operations and financial condition, and may not generate the expected savings or other benefits intended by management. Additional risks associated with the continuing impact of the restructuring activities include employee attrition, the ability to hire new employees in the future, diversion of management attention, and adverse effects on employee morale. In addition, our ability to complete this plan and achieve the anticipated benefits from it within the expected time frame, or at all, is subject to management’s estimates and assumptions and may vary materially from our expectations, including as a result of factors that are beyond our control. If we do not realize the expected benefits of this plan on a timely basis, or at all, our business, results of operations and financial condition could be adversely affected. Furthermore, following completion of this plan, our business may not be more efficient or effective than prior to the implementation of such plan.

Competition and other factors in our markets could require us to adjust prices or increase capital and other expenditures or cause us to lose sales volume, any of which could have a material adverse effect on our business and financial results.     In many of our markets, our primary competitors may have greater financial, marketing, production and distribution resources than we do, and may be more diverse in terms of their geographies and brand portfolios. We compete with other beer and beverage companies not only for consumer acceptance and loyalty, but also for shelf, refrigerator and tap space in retail establishments and for marketing focus by our distributors and customers, most of which also distribute and sell other beers and beverage products. If we do not successfully transform along with the evolving industry, market dynamics and consumer preferences, our business and financial results could be materially adversely affected. Furthermore, our competitors may respond to industry and economic conditions and shifts in consumer behaviors more rapidly or effectively than we do. In order for us to remain competitive, we will need to continue to quickly and correctly adopt digital technologies, build analytical capabilities and scale brand expense investment levels, which our competitors may be able to achieve faster and with more resources. In all of the markets in which we operate, aggressive marketing strategies, such as reduced pricing, brand positioning, and increased capital or other investments by these competitors could have a material adverse effect on our business and financial results.

Our profitability may be impacted by prices that do not offset the inflationary pressures, which may impact our gross margins. Even if we are able to raise the prices of our products, we may not be able to sustain such price increases and consumers might react negatively to such price increases, which could have a material adverse effect on, among other things, our brand, reputation and sales. Price increases may also lead to a decrease in demand for our products as competitors may not adjust their prices or consumers may decide not to pay higher prices for our products, which could lead to a decline in sales volume and loss of market share. Our projections may not accurately predict the volume impact of price increases, which could adversely affect our business, financial condition and results of operations.

In addition, continuing consolidation among major global brewers and between brewers and other beverage companies and convergence of beverage categories may lead to stronger or new competitors, loss of partner brands, negative impacts on our distributor networks, alternate distribution networks and pressures from marketing and pricing tactics by competitors. Further consolidation of distributors in our industry, as well as increasing retail consolidation within the on-premise channel in certain markets in our EMEA&APAC segment, could reduce our ability to promote our brands in the markets in a manner that enhances rather than diminishes our brands' value, as well as reduce our ability to manage our pricing effectively and efficiently. Additionally, due to competition with brewers and other beverage companies, an increase in the purchasing power of our large competitors may cause further pricing pressures which could prevent us from increasing prices to recover higher costs necessary to compete. Such pressures could have a material adverse impact on our business and our financial results and market share. Increased pressures for reduced pricing or difficulties in increasing prices while remaining competitive within our markets, as well as the need for increased capital investment, marketing and other expenditures could result in lower

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profitability or loss of market share and volumes. We may also face inflationary pressures that may negatively influence our or our competitors' prices and reduce margins on our products. Moreover, most of our major markets are mature, so growth opportunities may be more limited to us than to our global competitors who may already be in higher growth or emerging markets. For example, net sales in our Americas segment accounted for approximately 78% of our total 2025 net sales. As a result, to the extent that we are unable to maintain or grow our market share in our mature markets, our sales and, in turn, business and financial results could be materially and adversely affected.

Our success as an enterprise depends on our ability to successfully premiumize our portfolio on a timely basis and innovate beyond beer. Any inability to deliver new products could have a material adverse effect on our business and financial results.     Our future growth will depend, in part, on our ability to continue to premiumize our portfolio and timely innovate and develop new products beyond traditional beer. We plan to continue to innovate, test and scale products. In addition, we also rely on certain arrangements with partner brands for innovation, development and growth in new products beyond beer. However, each of the launch and ongoing success of new products is inherently uncertain, especially with respect to consumer appeal. The launch of a new product can give rise to a variety of incremental or one-time costs and an unsuccessful launch or short-lived popularity of our product innovations could, among other things, affect consumer perception of our existing brands and our reputation as well as result in inventory write-offs and other costs. Our inability to attract consumers to our product innovations relative to our competitors’ products, especially over time, could have a material adverse effect on our growth, business and financial results.

As we premiumize and expand our portfolio to address emerging consumer needs, our existing brands could be adversely affected if we do not sufficiently allocate resources to support them. A material adverse impact on our brands' sales could affect how distributors and consumers prioritize our products and could create broader challenges for our route to market and ability to reach consumers. Furthermore, new beer or beyond beer premium products may require unique or higher quality ingredients, which, coupled with a highly competitive marketplace, could negatively impact the profitability and financial return of such new products.

Changes in the social acceptability, perceptions and the political view of the beverage categories in which we operate, including alcohol, could adversely affect our business. In recent years, there has been an increase in public and political attention on health and well-being as they relate to alcoholic beverages and the other categories in which we operate due in part to public concern over alcohol-related social problems, including driving under the influence, underage drinking and exposure to alcohol advertisements, and health consequences from the use, harmful use and misuse of alcohol. Negative publicity regarding alcoholic beverages and changes in consumer perceptions in relation to beer or other alcoholic beverages could adversely affect the sale and consumption of our products, which could adversely affect our business and financial results. Additionally, the concerns around alcohol, as well as health and well-being, could result in unfavorable regulations or other legal requirements in certain markets in which we operate, such as advertising, selling and other restrictions, increased taxes associated with our sales, or the establishment of minimum unit pricing. Any such regulations or requirements could change consumer and customer purchasing patterns and may require us to incur significant compliance costs, which could negatively impact our business and financial results. In particular, advocates of prohibition and other severe restrictions on the marketing labeling and sales of alcohol are becoming increasingly organized and coordinated on a global basis, seeking to impose laws or regulations or to bring legal actions against us to substantially curtail the consumption of alcohol, including beer, in developed and developing markets. Further, the alcohol industry may be criticized and experience an increase in the number of publications and studies, as well as lobbying efforts, arguing there is no safe level of alcohol consumption. If these perspectives gain traction and are reflected in regulations, requirements or restrictions in jurisdictions where we operate or plan to operate, they could have a material adverse effect on our business and financial results. For example, in February 2021, the EU published its Europe Beating Cancer Plan, which contemplates a proposal for mandatory health warnings on alcohol beverage product labels. In January 2025, the United States' outgoing Surgeon General issued an advisory recommending an update to the Surgeon General's warning label in the United States for alcohol-containing beverages to include a cancer risk warning. In Canada, proposed bills would require alcohol manufacturers to include alcohol health warning labels on alcoholic products that address alcohol-related health risks, including cancer, define a standard alcoholic drink, provide information on the number of standard drinks per package and recommend consumption limits. Ireland has also enacted legislation requiring new health warning labels on alcohol beverage products.

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Weak, or weakening of, economic, social or other conditions in the markets in which we do business, including cost inflation, tariffs and reductions in discretionary consumer spending, could adversely impact demand for our products or cause consumers to suffer financial hardship, which could have a material adverse effect on our business and financial results. Consumption of our products could be closely tied to general economic conditions. As a result, difficult macroeconomic conditions in our markets, such as further decreases in per capita income and level of disposable income driven by increases in inflation, impacts of tariffs, energy costs, income (and other) taxes and the cost of living, increased and prolonged unemployment or a further decline in consumer confidence, as well as limited or significantly reduced points of access of our product, political or economic instability or other country-specific factors, could continue to have a material adverse effect on the demand for our products.

Because our product sales rely on discretionary spending by consumers, recessions, economic downturns, price instability, inflation, tariffs, slowing economic growth, social and political instability, violent crime, war, terrorism and related matters in the markets where we compete could negatively affect our revenues and financial performance, and adversely impact our ability to grow or sustain our business. For example, under difficult or deteriorating economic conditions, consumers may seek to reduce discretionary spending by forgoing purchases of our products by shifting away from our premium and above premium products to lower-priced products offered by us or our competitors, by shifting from on-premise to off-premise consumption, or by shifting purchase to other categories, such as legal cannabis, delta-9, other hemp derived products, or online gambling, each of which could negatively impact our net sales and financial results. A significant portion of our consolidated net sales are concentrated in the U.S., Canada and countries in Europe. Therefore, unfavorable macroeconomic conditions could negatively affect consumer demand for our products in these important markets, which could reduce our profitability, and consequently may negatively affect the results of operations in our Americas and EMEA&APAC segments.

Our operations are dependent on the global supply chain and face significant exposure to changes in commodity and other input prices, impacts of supply chain constraints and disruptions and inflationary pressures, including tariffs, which could adversely impact our operating results. We depend on the effectiveness of our supply chain management to assure reliable and sufficient supply of quality products. Geopolitical tensions and political conflicts could adversely impact our employees, financial performance and global operations, including by, among other things, jeopardizing the safety of our employees and facilities, disrupting our and our partners' operations and causing market volatility, which could adversely impact consumer demand and our sales. Our business has been, and may continue to be, impacted by supply chain constraints and disruptions, caused in part, by wars and conflicts, such as the Russia-Ukraine conflict, and the uncertain economic environment worldwide. These supply chain constraints could put significant inflationary pressures on commodity and other input prices. Supply chain disruptions may cause delays in shipments of our products and supplies. Failure to adequately produce and timely ship our products to customers could potentially lead to lost revenue, failure to meet customer demand, strained relationships with customers including wholesalers, and diminished brand loyalty. Further escalation of geopolitical tensions, including increased trade barriers or restrictions on global trade driven in part by increased tariffs, could result in, among other things, broader impacts that expand into other markets, economic recessions, inflationary pressures, cyberattacks, energy supply availability shortages, supply chain and logistics cost increases or disruptions, lower consumer demand and volatility in foreign exchange rates, interest rates and financial markets, any of which may adversely affect our business and supply chain.

In addition, our Americas segment is exposed to variability in the market price of a regional premium differential (referred to as “Midwest Premium” in the U.S.) charged by industry participants to deliver aluminum from the smelter to the manufacturing facility. This premium differential also fluctuates in relation to several conditions, including based on the supply of and demand for aluminum in a particular region, associated transportation costs and warehouse financing transactions, which limit the amount of physical aluminum available to consumers and increases the price differential as a result. Due to the opaque pricing of Midwest Premium and the limited liquidity of the market, hedging Midwest Premium can be costly. During times of greater volatility in the Midwest Premium, the variability in our cost of goods sold can also increase. For example, in 2025, the Midwest Premium increased, which resulted in an approximate $35 million unfavorable impact on our results for the year ended December 31, 2025. In addition to impacting the price we pay for the raw materials we purchase, changing premium differentials impact our end consumers as we may pass on the increased cost to those consumers in order to maintain our profit margins. To the extent any of the foregoing factors, including fluctuations in Midwest Premium, affect the availability or prices of ingredients or packaging, or our hedging arrangements do not effectively or completely hedge changes in commodity price risks, and we are not able to pass these increased costs along to customers, our business and financial results could be further materially adversely impacted.

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We purchase and use a large volume of agricultural and other raw materials, which are purchased through supply contracts with third parties, to produce our products (including barley, malted barley, hops, corn and other various adjuncts), as well as water and packaging materials (including aluminum cans and bottles, glass and polyethylene terephthalate containers as well as cardboard and other paper products). In addition, we also purchase and use a significant amount of diesel fuel, natural gas, electricity and carbon dioxide in our operations. The supply and price of these raw materials and commodities can fluctuate due to conditions that are difficult to predict and are beyond our control, including global geopolitical conditions or events (including the Russia-Ukraine conflict), governmental regulations (including tariffs that can cause the Midwest Premium to fluctuate and including extended producer responsibility requirements which lead to producers paying the full value chain recycling of packaging materials sold), global competition for resources, inflationary pressures related to domestic and global economic conditions or supply chain issues, currency fluctuations, alternative sources for suppliers, disease outbreaks or pandemics, trade agreements, frosts, droughts and other weather conditions and events, agricultural productivity, crop and plant diseases, theft, industry surcharges and other practices.

Similarly, if the costs of goods continue to increase, our suppliers may seek price increases from us. If we are unable to mitigate the impact of these matters through price increases to our customers, cost savings initiatives, hedging arrangements, or other measures, our results of operations and financial condition could be adversely impacted.

The success of our business relies heavily on brand image, reputation, product quality and protection of intellectual property.     It is important that we maintain and enhance the image and reputation of our existing brands and products, including our corporate purpose, mission and values. Concerns about product quality, even when unsubstantiated, could be harmful to our image and the reputation of our brands and products. While we have quality control programs in place, in the event we or our third-party manufacturers or suppliers experience an issue with product quality or if any of our products become unsafe or unfit for consumption, are misbranded or cause injury, we may experience recalls or liability in addition to business disruption which could further negatively impact our brand image and reputation, negatively affect our sales and cause us to incur additional costs. A widespread product recall, multiple product recalls or a significant product liability judgment could cause our products to be unavailable for a period of time, which could further reduce consumer demand and brand equity. We also could be exposed to lawsuits or regulatory enforcement relating to product liability, labelling, marketing or sales practices or intellectual property infringement. Our brand image and reputation may also be difficult to protect due to less oversight and control as a result of outsourcing some of our operations internationally or entering new or different product lines. Additionally, if we are unable to address and uphold our plans with respect to our sustainability initiatives or actions by and attitudes of regulators and the public health community, our image and brand equity may be impacted, which may be difficult to combat or reverse and could have a material adverse effect on our business and financial results.

In addition, because our brands carry family names, personal activities by certain members of the Molson or Coors families that harm their public image or reputation could also have an adverse effect on our brands or our reputation. We also engage with celebrities, influencers and other famous sponsors, and personal activities by these or any other promotional partners or business partners that harm their public image or reputation could also have an adverse effect on our brands or our reputation. Our brand image, reputation and financial results may be impacted by our ability to navigate marketing campaigns and trends that may intersect, even inadvertently, with various dynamic issues facing society on regional and global levels across the markets in which we operate.

Further, our success is dependent on our ability to protect our intellectual property rights, including trademarks, patents, domain names, trade secrets and know-how. We cannot be certain that the steps we have taken to protect our intellectual property rights will be sufficient or that third parties will not infringe upon or misappropriate these rights or that other parties may claim that our brands infringe on their intellectual property rights. If we are unable to protect our intellectual property rights, it could have a material adverse effect on our business and financial results.

Issues and regulations related to climate change, sustainability, human rights and human capital, and stakeholder response thereto may have an adverse effect on our business, financial condition and results of operations and may damage our reputation. Companies across all industries are facing increasing scrutiny relating to their workforce and environmental practices and policies. The landscape related to such regulation, compliance, and reporting is constantly evolving, including expanding in scope and complexity. For example, the state of California, and the European Commission have published proposed or final rules, including the European Commission's Corporate Sustainability Reporting Directive, that will require significantly increased disclosures related to climate change and other issues. We may experience significant future cost increases associated with regulatory compliance for sustainability matters, including fees, licenses, reporting, auditing and the cost of capital improvements for our operating facilities to meet sustainability and/or environmental regulatory requirements.

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Investor advocacy groups, institutional investors, stockholders, activists, employees, consumers, customers, regulators, proxy advisory services and other market participants have increasingly focused on these types of matters and initiatives, as well as the related practices and policies of companies. These stakeholders have placed increased importance on these practices and their effect on companies from an investor, consumer, customer or employee perspective. We have also published goals across a range of environmental sustainability and safety matters. Although we have initiatives against these goals, we may be required to expend resources for them, which could increase our operational costs.

In addition, we could be criticized for the scope or nature of these goals, or for any revisions to our goals. Furthermore, some stakeholders may disagree with our goals and there is also a risk that stakeholders may change their views on these topics over time. Our various stakeholders or regulators may also have divergent opinions on these types of matters as well as conflicting expectations regarding our culture, values, goals and business, which makes it difficult to achieve a consistently positive perception amongst all of our various stakeholders. Moreover, we may determine that it is in the best interest of our Company and our stockholders to prioritize other investments over the achievement of our current goals based on economic, technological developments, regulatory and social factors, business strategy or pressure from investors, activists, regulators, or other stakeholders. Some stakeholders may advocate for greater transparency and more aggressive ESG-related commitments across areas such as human capital, labor practices, supply chain oversight, and diversity. Others, including advocacy organizations and litigation-focused groups, may criticize ESG-related initiatives and challenge companies, through lawsuits, regulatory investigations, and public campaigns, for implementing ESG strategies they deem inconsistent with fiduciary duties or legal obligations.

If our practices do not meet evolving investor, industry, stakeholder or regulatory expectations and standards, related to, among other things, climate change, carbon emissions, packaging, safety and related matters, or if we are perceived (whether or not valid) to have not responded appropriately to the growing and various concerns for or against such issues, or if we fail to meet the goals, among other things, our reputation, culture, ability to attract or retain employees, brands, sales, stock price, ability to access the capital markets, or our overall business or financial results could be adversely affected. Further, if we incur adverse publicity and reaction from investors, activists, or other stakeholders related to our efforts and goals, the perception of us and our products and services by current and potential customers, as well as investors, could cause our customers and consumers to stop purchasing our products or to purchase products from a competitor or subject us to legal and regulatory proceedings, any of which could have a material adverse effect on our business and financial results.

Cybersecurity incidents impacting our information systems and violations of data privacy laws and regulations could disrupt our business operations and adversely impact our reputation and results of operations. Our information systems may be the target of cyberattacks or other security breaches, which, if successful, could, among other things, disrupt our operations, applications or services, cause the loss of key business, employee, customer or vendor information, cause us to breach our legal, regulatory or contractual obligations, prevent us from accessing or relying upon critical business records, cause reputational damage, or impact the costs or ability to obtain adequate insurance coverage. These incidents may result from human errors, equipment failure, or fraud or malice on the part of employees or third parties. The risk of cyber threats or cyberattacks increases as we rely more on digital partners, including supply-chain partners integrated into our business, who may also be the target of cyberattacks or other security breaches. If our information systems suffer severe disruption, damage, or shutdown we could experience delays and disruptions in our business, including brewery operations, production or shipments, or delays in reporting our financial results, such as those we experienced with the March 2021 cybersecurity incident, which could adversely affect our cash flows, competitive position, reputation, financial condition or results of operations. A breach of our information systems could subject us to litigation, including class action or derivative lawsuits, regulatory fines, and penalties, any of which could have a material adverse effect on our financial results or reputation. We continue to experience an increase in the number of attempted cyberattacks due, in part, to the increasing reliance of our employees, vendors and contractors on distributed, hybrid, and mobile access to work and access our technology infrastructure because of shifts in working arrangements. Furthermore, continued geopolitical turmoil, including the Russia-Ukraine conflict, has heightened the risk of cyberattacks. As discussed further below, the rapid evolution and increased adoption of artificial intelligence and machine learning technologies by third parties (including threat actors) may increase our cybersecurity risks.

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We expend significant financial resources to attempt to vigorously monitor and mitigate against cyber threats and cyberattacks. We may be required to incur further costs to alleviate problems and remedy damage caused by physical, electronic and cybersecurity breaches and to address possible increased information system attacks as a result of the incident, which could have a material adverse effect on our business and financial results. Additionally, these events may not be insured against or may not be fully covered by any insurance maintained by us and there is no assurance that liability clauses in any of our contracts would be enforceable or adequate to protect us from liabilities or damages as a result of a cybersecurity incident (including incidents affecting our third-party vendors). As techniques used to breach security are growing in frequency and sophistication and are generally not recognized until launched against a target, we may not be able to implement security measures in a timely manner or, if and when implemented, these measures could be circumvented regardless of our expenditures and protection efforts. We could also be required to spend significant financial and other resources to remedy the damage caused by a security breach or to repair or replace networks and information systems, which could have a material adverse effect on our business and financial results.

Misuse, leakage or falsification of information could result in a violation of data privacy laws or regulations, including but not limited to, the EU's General Data Protection Regulation, California Privacy Rights Act, the Virginia Consumer Data Protection Act, the Colorado Privacy Act and other similar comprehensive data privacy laws, may damage our reputation and credibility or expose us to increased risk of lawsuits, loss of existing or potential future customers and/or increases in our security costs and compliance burden, any of which could have a material adverse effect on our business and financial results. Other jurisdictions in which we operate have enacted or are proposing similar laws and regulations related to data privacy and data security. These laws and regulations are evolving and subject to interpretation. In addition, we may suffer financial and reputational damage because of lost or misappropriated information relating to identifiable individuals and may become subject to legal action and increased regulatory oversight or consumers may avoid our brands due to negative publicity. In the event of a breach resulting in loss of data, such as personally identifiable information or other such data protected by data privacy or other laws, even if encrypted, we may be liable for damages, fines and penalties for such losses under applicable regulatory frameworks despite not handling the data directly. Further, the regulatory framework around data custody, data privacy and breaches may be inconsistent from one jurisdiction to another and is an evolving area of law. We may not be able to limit our liability or damages in the event of such a loss.

Furthermore, the cybersecurity and data privacy regulatory environment, including, but not limited to, the SEC's disclosure-related cybersecurity rules, is increasingly challenging, and may present material obligations and risks to our business, including significantly expanded compliance burdens, costs and enforcement risks. For example, emerging regulations, such as the EU's Network and Information Security (NIS2), may lead to significant financial penalties, potential executive-level legal liability, mandated urgent corrective actions, operational disruptions, and/or increased cyber-incident impact if our governance, monitoring, or incident-reporting controls are insufficient.

The integration and use of artificial intelligence and similar technology in our business presents challenges and risks that could adversely impact our business, reputation and results of operations. The use of artificial intelligence, combined with an uncertain regulatory environment, may result in reputational harm, liability, or other adverse consequences to our brands, marketing and business operations. Molson Coors or its third-party vendors may adopt and integrate artificial intelligence tools into our systems for specific use cases, including leveraging artificial intelligence in our marketing efforts, after review by legal and information security and in alignment with internal oversight and policies and procedures. Our vendors and third-party partners may also incorporate artificial intelligence tools into their offerings with or without disclosing this use to us in a timely or complete manner. The providers of these artificial intelligence tools may not meet existing or evolving regulatory or industry standards concerning privacy and data protection, which may result in a loss of intellectual property or confidential information and/or cause harm to our reputation and the public perception of the effectiveness of our security measures or other internal controls. Further, bad actors around the world use increasingly sophisticated methods, including the use of artificial intelligence, to engage in cyberattacks or illegal activities involving the theft and misuse of personal information, confidential information and intellectual property. The technologies underlying artificial intelligence and their use cases are rapidly developing, and it is not possible to predict all of the legal, operational or technological risks related to the use of artificial intelligence. While new artificial intelligence initiatives, laws and regulations are emerging and evolving, uncertainty will remain, and our obligation to comply with the evolving regulatory landscape could entail significant costs, negatively affect our business, or limit our ability to incorporate certain artificial intelligence capabilities into our business. Any of these factors or outcomes could damage our brands and reputation, result in the loss of valuable property and information or otherwise adversely impact our business.

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Because of our reliance on third-party service providers and internal and outsourced systems for our information technology and certain other administrative functions, we could experience a disruption to our business.     We rely extensively on information services providers worldwide for our information technology functions including network, help desk, hardware and software configuration. Additionally, we rely on internal networks and information systems and other technology, including the internet and third-party hosted services, to support a variety of business processes and activities, including brewing operations, procurement and supply chain, manufacturing, distribution, invoicing and collection of payments. We use information systems and global business service providers for certain human resource activities and to process our employee benefits, as well as to process financial information for internal and external reporting purposes and to comply with various reporting, legal and tax requirements. As information systems are critical to many of our operating activities, our business may be impacted by system shutdowns, service disruptions, obsolescence, or security threats or breaches. Furthermore, the importance of such information technology systems and networks has increased due to many of our employees working remotely as a result of our changing workplace dynamics. Additionally, if any of our significant service providers were to fail and we were unable to find a suitable replacement in a timely manner, we could be unable to properly administer our outsourced functions, which could disrupt our business and adversely affect our financial results.

Due to a high concentration of workers represented by unions or works councils, we could be significantly affected by labor strikes, work stoppages or other employee-related issues. As of December 31, 2025, approximately 27% and 25% of our Americas and EMEA&APAC workforces, respectively, are represented by labor unions or councils. Stringent labor laws in certain of our key markets expose us to a greater risk of loss should we experience labor disruptions in those markets. From time to time, our collective bargaining agreements come due for renegotiation, and, if we are unable to timely complete negotiations, affected employees may strike, which could have an adverse effect on our business and financial results. Furthermore, there may be additional work stoppages, unionization efforts or other employee-related issues, either prior to or following the expiration of these agreements, each of which could significantly affect our business and financial results. A prolonged labor strike, work stoppage, unionization efforts or other employee-related issues could have a material adverse effect on our business and financial results. For example, at the end of March 2022 through mid-June 2022, the unionized employees in our Montréal/Longueuil, Québec brewery and distribution centers went on strike, which significantly adversely affected our business, operations and financial results during the second and third quarters of 2022. Furthermore, in February 2024, the unionized employees at our Fort Worth, Texas brewery went on strike, which adversely affected our business, operations and financial results during the second quarter of 2024.

Our success depends largely on key personnel, and the loss of such personnel or failure to appropriately manage our CEO transition could harm our business and our ability to execute our strategy and labor shortages, employee turnover and wage increases could also significantly impact our operations. Our success depends largely on the continued services of key personnel and their ability to execute our corporate strategy. Further, in September 2025, we announced the appointment of Rahul Goyal as our President and CEO, following the announcement of Gavin D.K. Hattersley's retirement from our Company. Our future performance will depend, in part, on the successful transition of Mr. Goyal as our new CEO as well as his ability to lead our Company. If we do not successfully manage our CEO transition, it could be viewed negatively by our customers, employees or investors and could have an adverse impact on our business. Further, the loss of the services and expertise of any key employee, or multiple members of senior management at the same time, could harm our business. Our future success depends, in part, on our ability to identify, attract and retain qualified personnel on a timely basis. If we were to experience turnover of any key employee or multiple members of senior management at the same time, or if a member or members of our senior management were to become ill or incapacitated, our stock price, our results of operations, our commercial and supply chain operations and our vendor or customer relationships could each be adversely impacted and such events may make recruiting for future management positions more difficult. The labor market for many of our employees is very competitive, and wages and compensation costs continue to increase. Our ability to attract and retain key talent has been, and may continue to be, impacted by challenges in the labor market, which has recently been experiencing wage inflation, labor shortages, and a continued shift toward remote work. In addition, labor costs are rising and our industry is experiencing a shortage of qualified workers. If we face labor shortages and/or increased labor costs as a result of increased competition for employees, higher employee turnover rates, or increases in employee benefits costs, our operating expenses could increase, which could negatively impact our growth and results of operations. Labor shortages, higher employee turnover rates and labor union organizing efforts could also lead to disruptions in our business, as discussed above. In addition, we must successfully integrate any new management personnel that we hire within our organization, or who join our organization as a result of an acquisition, in order to achieve our operating objectives, and changes in other key management positions may temporarily affect our financial performance and results of operations as new management becomes familiar with our business.

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Loss, operational disruptions or closure of a major brewery or other key facility, including those of our suppliers, due to unforeseen or catastrophic events or otherwise, could have a material adverse effect on our business and financial results. Our business could be interrupted and our financial results could be materially adversely impacted by physical risks such as earthquakes, fires, hurricanes, floods, other severe weather events, acts of war, terrorist attacks, cyberattacks and other disruptions in information systems, such as the March 2021 cybersecurity incident, disease outbreaks or pandemics and other natural disasters or catastrophic events that damage, disrupt or destroy one of our breweries or key facilities or the key facilities of our significant suppliers. Such significant losses or disruptions could be due to, among other things, the loss or disruption of the timely availability of adequate supplies of essential raw materials for us and our suppliers, including single-source suppliers; our ability to effectively integrate new suppliers into our operations; material financial issues facing our suppliers, such as bankruptcy or similar proceedings; transportation and logistics challenges, including as a result of governmental restrictions and the availability and capacity of shipping channels as customers may shift to increased online shopping; the loss or disruption of other manufacturing, distribution and supply capabilities; labor shortages, strikes or work stoppages; the loss or disruption of the supply of carbon dioxide gas; acts of war and terrorism; or natural disasters, pandemics, public health crises, or other catastrophic events and the associated impacts of such events, including impacts on our employees, their families, or our suppliers.

If any of our breweries or key facilities or the key facilities of our significant suppliers experience a significant operational disruption or catastrophic loss, it could delay, disrupt or reduce production, shipments and revenue, and result in potentially significant expenses to repair or replace these properties. We experienced certain of the foregoing risks and losses in connection with the March 2021 cybersecurity incident and the coronavirus pandemic in 2020. Certain catastrophes are not covered by our general insurance policies, which could result in significant unrecoverable losses. Our business and results of operations could also be adversely impacted by under-investment in physical assets or production capacity, including contract brewing and impact the priority of our brands if production capacity is limited. Further, significant excess capacity at any of our breweries as a result of increased efficiencies in our supply chain process or continued volume declines could result in under-utilization of our assets, which could lead to excess overhead expenses or additional costs incurred associated with the closure of one or more of our facilities. For example, as part of a strategic review of our supply chain network, certain breweries and bottling lines were closed in recent years, and we have incurred brewery closure costs, including charges associated with the closure of our breweries in Chippewa Falls, Wisconsin, and 10th Street in Milwaukee, Wisconsin in late 2024 and early 2025. We regularly review our supply chain network in an attempt to ensure that our supply chain capacity is aligned with the needs of the business. Such reviews could potentially result in further closures and the related costs could be material.

Climate change and other weather events may negatively affect our business and financial results.   There is concern that the continuing increase in global average temperatures could cause significant changes in global weather patterns and an increase in the frequency and severity of natural disasters. Global climate change could have various impacts on our operations, ranging from more frequent extreme weather events to extensive governmental policy developments, which have the potential individually or collectively to significantly disrupt our business as well as negatively affect our suppliers, supply chain and customers. Changing weather patterns and more volatile weather conditions could result in decreased agricultural productivity in certain regions that may impact quality, limit availability or increase the cost of key agricultural commodities, such as hops, barley and other cereal grains, which are important ingredients for our products. Increased frequency or duration of extreme weather conditions, including power disruptions and/or water availability implications due to the foregoing, could also impair production capabilities, disrupt our supply chain, distribution networks and routes to market, or impact demand for our products, any of which may cause us to experience additional costs to maintain or resume operations.

Public concern over climate change has resulted in, and may continue to result in, new or increased regional, federal and global legal and regulatory requirements, including taxation, to reduce or mitigate carbon emissions and to limit or impose additional costs on carbon and water usage or other climate-related objectives. In the event that such regulation is more stringent than current regulatory obligations, or the measures that we are currently undertaking to monitor and improve our resource efficiency are insufficient, we may experience disruptions in, or increases in our costs of, operation and delivery to comply with new regulatory requirements due to investments in facilities and equipment or the relocation of our facilities. If we or our suppliers are required to comply with these laws and regulations, or if we choose to take additional voluntary steps to reduce or mitigate our impact on the climate, we may experience increased costs for energy, production, transportation, and raw materials, increased capital expenditures, or increased insurance premiums and deductibles, each of which could adversely impact our operations. In particular, proposed, new or inconsistent regulation and taxation of fuel and energy could increase the cost of complying with such laws and regulations as well as the cost of operation, including fuel required to operate our facilities or transport and distribute our products, thereby increasing the distribution and supply chain costs associated with our products. As legislation across Europe is changing rapidly at both the EU and national level, a full assessment of the potential impact of future climate change legislation, regulations or industry standards, as well as any international treaties and accords, would be uncertain, given the wide scope of potential regulatory change in the countries in which we operate. Such an assessment could also result in additional administrative and cost burdens.

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Beyond the commercial pressures implicated by climate change concerns, our operations may face potential adverse physical effects. For example, we have a major brewery in the state of Colorado, which experienced several significant wildfires in 2022, and we have another major brewery in Texas, which experienced a severe winter weather event in 2021. If any of our properties and production facilities experience a significant operational disruption or catastrophic loss due to natural disasters or severe weather events, it could delay or disrupt production, shipments, and revenue, and result in potentially significant expenses to repair or replace these properties, which may negatively affect our business and financial results.

An inadequate supply or availability of quality water could have a material adverse effect on, among other things, our sales, production processes, other costs and, in turn, profitability. Quality water is a key ingredient in our brewing process. Clean water is a limited resource in many parts of the world and climate change may increase water scarcity and cause a deterioration of water quality in areas where we maintain brewing operations. The competition for water among domestic, agricultural and manufacturing users is increasing in some of our brewing communities and communities in which we or our suppliers manufacture our other products. Even where water is widely available, water purification, regulatory requirements, and waste treatment infrastructure limitations could increase costs or constrain our operations. Further, the lack of availability of clean water at our breweries or our other facilities or the facilities of our suppliers could cause a decrease in production.

We have substantial brewery operations in the states of Colorado and Texas, which have been areas vulnerable to water scarcity conditions. Certain western states in the U.S. are, have, or may in the future experience extended droughts, which can impact the quality and quantity of agricultural ingredients such as barley and hops. One of our facilities in the U.K. has had water use restrictions imposed on its operations due to increased domestic demand on the underlying groundwater aquifer. The continuation or recurrence of such conditions could have an adverse effect upon our agricultural supply chain. We and our suppliers are dependent on sufficient amounts of quality water for operation of our breweries and key facilities and the key facilities of our significant suppliers. The suppliers of the agricultural raw materials we purchase are also dependent upon sufficient supplies of quality water for their fields. A substantial reduction in water in certain agricultural areas could result in material losses of crops, such as barley or hops, which could lead to a shortage of our product supply. If water available to our operations or the operations of our suppliers becomes scarce or the quality of that water deteriorates, we may incur increased production costs that we are unable or choose not to pass along to distributors through increased prices, or face production constraints, which could adversely affect our business and financial results.

Poor investment performance of pension plan holdings and other factors impacting pension plan costs and contributions could unfavorably affect our business, liquidity and our financial results.     Our costs of providing defined benefit pension plans are dependent upon a number of factors, such as the rates of return on the plans' assets, discount rates, the level of interest rates used to measure the required minimum funding levels of the plans, exchange rate fluctuations, government regulation, court rulings or other changes in legal requirements, global equity prices, and our required and/or voluntary contributions to the plans. Although we comply with the minimum funding requirements, we have certain qualified pension plans with obligations which exceed the value of the plans' assets. These funding requirements also may require contributions even when there is no reported deficit. Without sustained growth in the pension investments over time to increase the value of the plans' assets, and depending upon the other factors as listed above, we could be required to fund the plans with significant amounts of cash. Such cash funding obligations (or the timing of such contributions) could have a material adverse effect on our cash flows, credit rating, cost of borrowing, financial position and/or results of operations.

Complications in the design or implementation of our expanded and optimized enterprise resource planning ("ERP") system could adversely affect our business and operations. We rely heavily on information systems and technology to manage operations and report results. Beginning in the third quarter of 2025, we initiated a multi-year implementation of a global ERP system intended to replace legacy operating and financial systems with a single global system. This system is being designed to maintain accurate financial records, underpin operational capabilities and provide timely information to senior management. The implementation requires significant personnel and financial resources and may involve delays, cost overruns or other challenges. Disruptions or failures during design or implementation could impair critical processes, including forecasting, manufacturing, procurement, vendor payments, customer ordering and fulfillment, revenue recognition, receivables collection, contractual compliance, and internal controls and financial reporting. If we are unable to execute the implementation as planned, our financial position, operating results and cash flow could be negatively impacted. Furthermore, if the ERP system does not function as intended, the effectiveness of our internal control over financial reporting could be compromised.

Further, as we implement our new ERP system, our exposure to system attacks may be elevated because we will be operating current and new processes in parallel and must simultaneously protect both the new system and legacy systems. Additionally, our implementation of the ERP system involves greater utilization of third-party cloud computing services in connection with our business operations. Problems faced by us or our third-party cloud computing providers, including technological or business-related disruptions, as well as cybersecurity threats, could adversely impact our business, results of operations and financial condition for future periods.

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Risks Related to Our Indebtedness, Capital Structure and Financial Condition

Our debt level subjects us to financial and operating risks and the agreements governing such debt subject us to financial and operating covenants and restrictions. Our indebtedness subjects us to various financial and operating covenants, including, but not limited to, restrictions on priority indebtedness, leverage thresholds, liens, certain types of secured debt and certain types of sale lease-back transactions and transfers of assets, each of which may limit our flexibility in responding to our business needs. If we are not able to maintain compliance with stated financial covenants or if we breach other covenants in any debt agreement, we could be in default under such agreement or trigger a cross-default of other debt instruments. Such a default would adversely affect our credit ratings, may allow our creditors to accelerate the related indebtedness, and may result in the acceleration of any other indebtedness to which a cross-acceleration or cross-default provision applies.

Our current and future debt levels and the terms of such debt could, among other things:

• make it more difficult to satisfy our obligations under the terms of our indebtedness;

• limit our ability to refinance our indebtedness on terms acceptable to us, or at all, or obtain additional financing for working capital, capital expenditures, strategic opportunities, including acquisitions or other investments, to fund growth or for general corporate purposes, even when necessary to maintain adequate liquidity;

• limit our flexibility to plan for and adjust to changing business and market conditions, including successfully execute our business strategy, and increase our vulnerability to general adverse economic and industry conditions;

• require us to make unfavorable changes to our financing structure or require us to dedicate a substantial portion of our cash flow to make interest and principal payments on our debt, thereby limiting the availability of our cash flow to fund strategic opportunities, including acquisitions or other investments, working capital, capital expenditures, dividend payments, share repurchases and other general corporate requirements; and

• adversely impact our competitive position in the industry.

In addition, certain of our current and future debt and derivative financial instruments have or, in the future, could have interest rates that are tied to reference interest rates. The volatility and availability of such reference rates are out of our control and the risks related thereto could have a material adverse effect on us.

A deterioration in our credit rating could increase our borrowing rates or have an adverse effect on our ability to obtain future financing or refinance current debt. Ratings agencies may downgrade our credit ratings below their current investment grade levels if we are, or are at risk of being, unable to meet our deleveraging commitments. Although we have publicly expressed our intention to maintain an investment grade debt rating, ratings are determined by third-party rating agencies and in some cases the events that may cause us to suffer a ratings downgrade are unpredictable and outside of our control, such as evolving industry dynamics, changes in consumer taste preferences and behaviors, the macroeconomic climate or political instability. A credit rating downgrade, particularly a downgrade below investment grade, could increase our costs of future borrowing, negatively impact our hedging instruments or sources of short-term liquidity and harm our ability to refinance our debt in the future on acceptable terms or access the capital markets, all of which could have a material adverse effect on our financial position. Deterioration of our credit rating may also raise governance issues within our Company and with external regulators.

Default by, or failure of, one or more of our counterparty financial institutions could cause us to incur significant losses. As part of our risk management activities, we enter into transactions involving derivative financial instruments, including, among others, forward contracts, commodity swap contracts and option contracts, with various financial institutions. In addition, we have significant amounts of cash and cash equivalents on deposit or in accounts with banks or other financial institutions in the U.S. and abroad. As a result, we are exposed to the risk of default by, or failure of, counterparty financial institutions. The risk of counterparty default or failure may be heightened during economic downturns and periods of uncertainty in the financial markets. If one of our counterparties were to become insolvent or file for bankruptcy, our ability to recover losses incurred as a result of default or to retrieve our assets that are deposited or held in accounts with such counterparty may be limited by the counterparty's liquidity or the applicable laws governing the insolvency or bankruptcy proceedings.

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We may incur impairments of the carrying value of our goodwill and other intangible assets which could have a material adverse effect on our financial results.   In connection with various business combinations, we have historically allocated material amounts of the related purchase prices to goodwill and other intangible assets, including those considered to have indefinite useful lives. These assets are tested for impairment when required by accounting principles generally accepted in the United States, using estimates and assumptions affected by factors such as economic and industry conditions and changes in operating performance. Additionally, in conjunction with the indefinite-lived intangible asset impairment tests, we also reassess each asset's indefinite-life classification. Potential resulting charges from an impairment of goodwill or brand intangible, as well as reclassification of an indefinite-lived to a definite-lived brand intangible, could have a material adverse effect on our results of operations. For example, during the third quarter of 2025, as we began updating our long-range plan based on current year results to date and industry conditions, we identified a triggering event that indicated it was more likely than not that the carrying value of the Americas reporting unit exceeded its fair value. An impairment test was completed as of August 31, 2025 and as a result, the carrying value of the Americas reporting unit was determined to be in excess of its fair value such that a partial goodwill impairment loss of $3,645.7 million was recorded in our consolidated statements of operations during the third quarter of 2025. In addition, during the fourth quarter of 2022, we recorded a partial goodwill impairment charge of $845.0 million as a result of our 2022 annual goodwill impairment testing of the Americas reporting unit in our consolidated statements of operations during the fourth quarter of 2022. As of the year ended December 31, 2025, the EMEA&APAC reporting unit was fully impaired while the Americas reporting unit had $1.9 billion of goodwill remaining.

Further, during the third quarter of 2025, as we began updating our long-range plan based on our current year results to date, we identified a triggering event for the Blue Run Spirits asset group in the Americas segment. The results of our recoverability test indicated that the carrying value was in excess of its fair value and a full impairment of the definite-lived intangible brand of $75.3 million was recorded in our consolidated statements of operations during the third quarter of 2025. In addition, during the third quarter of 2025, as we began updating our long-range plan based on current year results to date, we identified a triggering event for the Staropramen family of brands in the EMEA&APAC segment. The results of the recoverability test indicated that the carrying value was in excess of its fair value and a partial impairment loss of $198.6 million was recorded in our consolidated statements of operations during the third quarter of 2025. In conjunction with the impairment review of the Staropramen family of brands, we also reassessed the brand's indefinite-life classification and determined that certain factors supported the reclassification to a definite-lived intangible asset, and therefore we assigned a useful life of 50 years. In addition, during the fourth quarter of 2023, a partial impairment charge of $160.7 million was recorded as a result of our 2023 annual impairment testing of the Staropramen family of brands.

As a result of the partial impairment charge recorded during the third quarter of 2025, the Americas reporting unit is still considered to be at a heightened risk of future impairment in the event of significant unfavorable changes in the forecasted cash flows (including Company-specific risks like the performance of our premiumization efforts, expansion in products beyond beer and overall market performance, along with macroeconomic risks, or significant unfavorable changes in income tax rates, environmental or other regulations, including interpretations thereof), terminal growth rates, market multiples and/or weighted-average cost of capital utilized in the discounted cash flow analyses.

The fair values of our Americas reporting unit and indefinite-lived intangible assets are sensitive to the aforementioned potential unfavorable changes that could have an adverse impact on future analyses. Any future impairment of the Americas reporting unit or our intangible assets, or reclassification of indefinite-lived intangible assets to definite-lived, may result in charges that could have a material adverse effect on our financial results, as evidenced by the charges incurred during the third quarter of 2025 as well as 2023 and 2022, as previously noted above. The testing of our goodwill for impairment is also predicated upon our determination of our reporting units. Any change to the conclusion of our reporting units or the aggregation of components within our reporting units could result in a different outcome to our annual impairment test. See Part II—Item 7 Management's Discussion and Analysis of Financial Condition and Results of Operations, "Critical Accounting Estimates" and Part II—Item 8 Financial Statements and Supplementary Data, Note 6, "Goodwill and Intangible Assets" for additional information related to the results of our annual impairment testing.

The estimates and assumptions on which our financial projections are based may prove to be inaccurate, which may cause our actual results to materially differ from such projections, which may adversely affect our future profitability, cash flows and stock price. Our financial projections, including any sales or earnings guidance or outlook we may provide from time to time, are dependent on certain estimates and assumptions related to, among other things, our current strategy, industry performance, category growth, development and launch of innovative new products, market share projections, product pricing, sales, volume and product mix, foreign exchange rates and volatility, effective tax rates, interest rates, depreciation and amortization costs, commodity prices, tariffs, distribution costs, cost savings initiatives, accruals for estimated liabilities, including litigation reserves and potential increases in costs under our self-insured health care plans, measurement of benefit obligations for pension and other postretirement benefit plans, and our ability to generate sufficient cash flow to reinvest in our existing business, fund internal growth, repurchase our stock, make acquisitions, invest in joint ventures, pay dividends and meet debt obligations. In addition, our ability to achieve the goals set by our current strategy, including the Americas

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Restructuring Plan announced in October of 2025, and the anticipated benefits, are subject to various assumptions and uncertainties. There is no assurance that we will fully realize the anticipated financial benefits or execute successfully on our current strategy in the time frames we desire or at all. Our financial projections are based on historical experience and on various other estimates and assumptions that we believe to be reasonable under the circumstances and at the time they are made, and our actual results may differ materially from our financial projections. Any material variation between our financial projections and our actual results may adversely affect our future profitability, cash flows and stock price.

Risks Related to Our Dependence on Third Parties

We rely on a small number of suppliers to obtain the input materials, in particular the packaging materials, we need to operate our business. The inability to obtain materials or disruptions at the facilities of our suppliers could unfavorably affect our ability to produce our products, which could have a material adverse effect on our business and financial results.     We purchase certain types of input and other packaging materials, including aluminum cans and bottles, glass bottles, paperboard and carbon dioxide from a small number of suppliers. The demand for such input materials in the beverage industry has increased in recent years, and resulted in a shortage of capacity and increases in costs. In addition, consolidation of packaging materials suppliers has reduced local supply alternatives and increased risks of supply disruptions. The inability of any of these suppliers to meet our production requirements without sufficient time to develop an alternative source could have a material adverse effect on our business and financial results. Additionally, if the financial condition of these suppliers deteriorates, our business and financial results could be adversely impacted. Our suppliers’ financial condition is affected in large part by conditions and events that are beyond our and their control, including:

• macroeconomic and political instability in the countries in which they operate;

• competitive and general market conditions in the locations in which they operate;

• the availability of capital and other financing resources on reasonable terms;

• loss of major customers;

• disruptions of operations that may be caused by strikes, work stoppages, labor unrest, fire or natural disasters;

• the increase in price of certain ingredients and raw materials used in our products; or

• any of the foregoing, among other things, as a result of the Russia-Ukraine conflict or otherwise.

Our ability to secure the correct quantities of raw and packaging materials on a timely basis depends on our ability to forecast demand for our finished products. Significant variances between forecasted and actual sales could disrupt supplier operations, which in turn could result in certain product shortages and increase the risk of customers switching to competitor brands.

Termination or changes of one or more manufacturer, distribution or production agreements, or issues caused by our dependence on the parties to these agreements, could have a material adverse effect on our business and financial results.     We manufacture and distribute products of other beverage companies through various joint ventures, licensing, distribution, contract brewing or other similar arrangements, such as our agreement to produce, import, market, distribute and sell certain Heineken brands in Canada, and our arrangements with ABI to brew and distribute Beck's , Stella Artois , and Lowenbrau and to distribute Hoegaarden , Leffe , and Corona in Central Europe. We also have authorizations from Red Tree Beverages, LLC that grant us the right to produce, market, advertise, promote, sell and distribute products bearing the Simply Spiked trademark in the U.S. and Canada, as well as the Topo Chico Hard Seltzer trademark in the U.S. In addition, we have a license agreement to produce, market, distribute and sell Fever-Tree products in the U.S. These agreements have varying expiration dates and performance criteria. The non-renewal or loss of one or more of these arrangements, because of failure to perform or failure to agree to terms of an extension, or as a result of industry consolidation or otherwise, could have a material adverse effect on our business and financial results.

As part of our efforts to streamline operations and to manage capital investments, we outsource aspects of our manufacturing processes and other functions and continue to evaluate additional outsourcing. If our contract manufacturers or other outsourcers fail to perform their obligations in a timely manner or at satisfactory quality levels, our ability to bring products to market and our reputation could suffer. For example, during a market upturn, our contract manufacturers may be unable to meet our demand requirements, which may preclude us from fulfilling our customers’ orders on a timely basis. The ability of these third parties to perform is largely outside of our control. If one or more of these parties experiences a significant disruption in services or institutes a significant price increase, we may have to seek alternative providers, which could increase our costs or prevent or delay the delivery of our products. Further, our business includes various joint ventures and industry agreements which optimize parts of the supply chain. For example, we have entered into joint ventures with Ball Corporation (i.e., Rocky Mountain Metal Container), and with Owens-Brockway Glass Container Inc. (i.e., Rocky Mountain Bottle

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Company), for a portion of our aluminum and glass packaging supply in the U.S., respectively. Another example includes our warehousing and customer delivery systems in Canada organized under joint venture agreements with other brewers. Any negative change in these agreements or material terms within these agreements could have a significant adverse effect on our business and financial results. Another example is the secondary distribution in the U.K. which has limited options. If we are unable to continue to outsource our secondary distribution services, we may have to in-source distribution which could have adverse impacts to our business and financial results. Additionally, in the U.K. we market, distribute and sell the products of other beverage companies through our factored channel whereby we provide a one-stop shop service to on-premise customers, combining spirits, soft drinks, wines and beer products. If these factored agreements are not renewed due to consolidations, market conditions or competitors securing the contracts, or we fail to deliver any sales commitments under such partnerships, this may have a material adverse effect on our financial and business operations.

Risks Related to Legal Matters, Governmental Regulations and our International Operations

Changes in environmental, trade or other regulations or failure to comply with existing licensing, trade and other regulations could cause volatility or have a material adverse effect on our business and financial results.     Our business is highly regulated by national, state, provincial and local laws and regulations in various jurisdictions governing tariffs, licensing, trade and pricing practices, labeling, advertising, promotion and marketing practices, distributor relationships, environmental matters, packaging and ingredient regulations, unclaimed property and other matters. These laws and regulations are frequently revised or reinterpreted and are influenced by political developments and regulatory scrutiny any of which could have a material adverse effect on our business and financial results.

Intervention by local governments could accelerate transformational changes to market structures. For example, the beer markets in the U.S. and Canada have historically consisted of a limited number of significant market participants with government-regulated routes to market. In Canada, changes to provincial trade rules and regulations, distribution models and packaging requirements, such as the use of government-owned retail outlets and industry standard returnable bottles, may be disadvantageous to us and adversely impact our business and financial results. In the second half of 2024, the Province of Ontario expanded the licensed sale of beer, wine and RTDs to all convenience stores and all eligible grocery and big-box grocery stores. This ongoing evolution of the Ontario beer market may have a significant impact on the financial results of our ownership in Brewers Retail, Inc. and adversely affect our financial results.

Furthermore, various jurisdictions have adopted, or may seek to adopt, additional product labeling or warning requirements, as well as restrictions on the availability of our beverages based on perceived adverse health consequences for certain of our beverages. Additional or more stringent requirements could limit sales of such affected beverages in those jurisdictions. In addition, we cannot predict whether our beverages will become subject to further labeling or warning rules and regulations which, if enacted, could increase our costs and/or adversely impact sales.

In addition, a number of governmental authorities, in the U.S. and internationally (including the U.K. and the EU), have enacted, are considering, or plan to introduce legislation targeting packaging materials. These initiatives include efforts to reduce plastic and other materials, eliminate single-use packaging, and expand funding for recycling infrastructure. The requirements of Extended Producer Responsibility ("EPR") and deposit return system ("DRS") legislation and regulations vary by jurisdiction, and such legislation, as well as voluntary initiatives aimed at reducing packaging waste, could reduce demand for our products, increase our compliance and other costs or otherwise adversely impact our business, financial condition and results of operations. Similarly, changes in environmental regulations, including regulations discouraging the use of certain materials or mandating alternatives, may increase compliance costs, materials costs, capital expenditures and investments, and other financial obligations for us and our business partners, which could negatively affect our profitability. We may be unable to implement price increases sufficient to offset these higher costs, and any such increases may result in lower sales volumes.

Changes to U.S. or foreign trade policies, including the imposition of new or increased tariffs, other trade restrictions or other government actions (including any government shutdown), as well as foreign currency fluctuations (including devaluations) and fear of exposure to or actual impacts of a widespread disease outbreak, may create or exacerbate such risks and uncertainty and adversely affect our business, financial condition, and results of operations.

Modifications of laws and policies governing international trade and investment, including tariffs, such as aluminum tariffs, and trade agreements such as the United States-Mexico-Canada Agreement and the European Union-United Kingdom Trade and Cooperating Agreement ("TCA"), could adversely affect our supply chain, business and results of operations. For example, the U.S. tariffs on aluminum imports imposed in June 2018 (and partially lifted in May 2019) created volatility in the price of aluminum in the U.S. and increased the price of aluminum used in some of our product packaging. Ongoing or additional U.S. tariffs, including on aluminum, retaliatory tariffs or related actions from trade partners, and related uncertainty may continue to increase the cost of certain of our imported materials and, adversely affect our profitability. The TCA, effective May 2021, also resulted in disruptions and transportation delays that affected our sourcing of raw materials and packaging for our products, as well as our ability to import and export products.

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Further, throughout 2025, additional tariffs imposed by the current U.S. administration affected the cost of certain products manufactured out the United States, including certain of our products, and contributed to fluctuations in the price of aluminum and the Midwest Premium. The increase in Midwest Premium prices resulted in, an approximate $35 million unfavorable impact on our results for the year ended December 31, 2025. Future actions by the U.S. or foreign governments, such as new or additional tariffs, changes to trade agreements or tax policies, expanded export controls, sanctions, investment restrictions, or other trade measures, remain uncertain at this time. These developments, along with potential shifts in raw material pricing, retaliatory government responses, or competitive advantages for companies not subject to the same trade restrictions. could have significant impacts on our business and financial results. Furthermore, we may be unable to increase prices for our products sufficiently to offset tariff-related impacts, including increases in the Midwest Premium, and any price increases we do implement could reduce consumer demand for our products, each of which could negatively impact our margins and sales. We cannot predict future trade policy actions, and any further changes could adversely impact our business, financial condition and results of operations.

Failure to comply with current or future environmental, health, or other applicable laws and regulations (or changes to those laws, regulations or interpretations) could result in the loss, revocation or suspension of our licenses, permits or approvals and could have a material adverse effect on our business, financial condition and results of operations. In addition, the nature and complexity of our international business relationships and contractual agreements, may lead to differences between actual results and the assumptions used in recording expenses, and future adjustments may be required if those assumptions change.

Changes in tax laws, regulations or tax rates could cause volatility or have a material adverse effect on our business and financial results. Changes to existing tax laws or the adoption of new tax policies, regulations, guidance or laws, particularly in the U.S., U.K. and Canada, could have a material adverse impact to our effective tax rate, future cash tax payments and our financial results in general. In addition, the current economic and political environment, including the focus on corporate tax reform, anti-base erosion rules and tax transparency, may result in significant tax law changes in the numerous jurisdictions in which we operate and could have a material adverse impact on our effective tax rate, future cash tax payments and our financial results in general. The increasingly complex tax environment as a result of tax policy changes can create higher compliance costs which could have an adverse effect on our financial performance.

On July 4, 2025, the OBBBA was enacted into law in the U.S. This law included various provisions which permanently extend certain expiring provisions from the Tax Cuts and Jobs Act of 2017. Changes in the OBBBA included the accelerated tax recovery for certain capital investments and research and development expenditures and changes to the business interest expense limitation. The OBBBA did not materially affect our effective tax rate but did result in the reduction of our cash paid for taxes in the second half of 2025.

In addition, intergovernmental organizations such as the Organization for Economic Co-operation and Development ("OECD") and EU have proposed or enacted changes to the existing tax laws of member countries. For instance, in 2021 the OECD introduced model rules for a new 15% global minimum tax framework, which is effective for fiscal years beginning on or after December 31, 2023 in jurisdictions with enacted legislation. Additionally, several non-EU countries, including Canada and the U.K., have recently proposed and/or enacted legislation consistent with the OECD global minimum tax framework. The OECD and implementing countries are expected to continue to make further revisions to their minimum tax legislation and release additional guidance. The OECD has also proposed rules on the allocation of profit among tax jurisdictions in which companies operate. Meanwhile, in January 2026 the OECD announced a comprehensive package for a "side-by-side agreement" that could exempt many U.S.-domiciled multinational enterprises from certain provisions under the global minimum tax framework. Subsequently enacted tax regulations and proposed rules, including the release of additional related guidance, could adversely impact our financial results in fiscal year 2026 and possibly beyond.

Our business operations are also subject to numerous taxes not based on income, often referred to as indirect taxes, and most relevant to our business, excise taxes. The government(s) of each country in which we sell our products, including state and local jurisdictions in the U.S., levy excise taxes at varying rates. Additionally, U.S. governmental entities that levy taxes may require bonds to ensure compliance with applicable laws and regulations. Increases in excise taxes and bonds could have a material adverse effect on our profitability.

Continued economic and political pressures to increase tax revenues in jurisdictions in which we operate, or the adoption of new or reformed tax legislation or regulation, may make resolving tax disputes more difficult. Additionally, prior decisions by tax authorities regarding treatments and positions of corporate income taxes could become subject to enforcement activities, as well as legislative investigation and inquiry, which could also result in changes in tax policies or prior tax rulings. The final resolution of tax audits and any related litigation can differ from our historical provisions and accruals, resulting in an adverse effect on our financial performance.

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Failure to comply with existing or future tax laws and regulations could have a material adverse effect on our business, financial condition and results of operations. Additionally, uncertainties exist with respect to the interpretation of, and potential future developments in, complex domestic and international tax laws and regulations, the amount and timing of future taxable income, and the interaction of such laws and regulations among jurisdictions. The complexity of tax laws and regulations could necessitate future adjustments to tax expense recorded.

Unfavorable outcomes of legal or regulatory matters may adversely affect our business and financial condition and damage our reputation. There is a risk of, and we are from time to time involved in or subject to a variety of litigation, claims, legal or regulatory proceedings or matters related to our business or the alcohol industry in general, including but not limited to our advertising and marketing practices, product claims, product labeling and ingredients, our intellectual property rights, alleged infringement or misappropriation by us of intellectual property rights of others, tax, environmental, privacy, insurance, ERISA and fiduciary responsibilities under ERISA, and other employment matters. Such matters, even those that are ultimately non-meritorious, can be complex, costly, and highly disruptive to business operations by diverting the attention and energies of management and other key personnel, and may generate adverse publicity that damages our reputation or brand image. The assessment of the outcome of such matters, including our potential liability, if any, is a highly subjective process that requires judgments about future events that are not within our control and are based on the information available to management at that time. The outcome of such matters, including amounts ultimately received or paid upon judgment or settlement, may differ materially from management’s outlook or estimates, including any amounts accrued in the financial statements. Actual outcomes, including judgments, awards, settlements or orders, could have a material adverse effect on our business, financial condition, operating results, or cash flows and damage our corporate reputation and our brands. See Part II—Item 8 Financial Statements and Supplementary Data, Note 13, "Commitments and Contingencies" in this Annual Report on Form 10-K for additional information regarding the status of pending legal outcomes.

Our operations in developing and emerging markets expose us to additional risks, which could harm our business and financial results. We continue to operate in developing and emerging markets. In certain of these markets, we have limited operating experience and may not succeed. In addition to risks described elsewhere in this report, our operations in these markets expose us to additional heightened risks, including:

• changes in local political, economic, social and labor conditions;

• restrictions on foreign ownership and investments;

• repatriation of cash earned in countries outside the U.S.;

• import and export requirements, including tariffs;

• poor product quality due to distance travelled for export product and the relatively short shelf life of beer;

• increased costs to ensure compliance with complex foreign laws and regulations;

• currency exchange rate fluctuations;

• a less developed and less certain legal and regulatory environment, which among other things can create uncertainty with regard to liability issues;

• longer payment cycles, increased credit risk and higher levels of payment fraud;

• increased exposure to global disease outbreaks or pandemics; and

• other challenges caused by distance, language, and cultural differences.

In addition, as a global company, we are subject to foreign and U.S. laws and regulations designed to combat governmental corruption, including the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act and the U.K. Proceeds of Crime Act. Violations of these laws and regulations could result in fines and penalties, criminal sanctions against us, our officers, or our employees, prohibitions on the conduct of our business and prohibitions on our ability to offer our products and services in one or more countries, each of which could have a materially negative effect on our reputation, brands and our operating results. Although we have implemented policies and procedures designed to ensure compliance with these foreign and U.S. laws and regulations, there can be no assurance that our employees, business partners or agents will not violate our policies and procedures.

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Changes to the regulation of the distribution systems for our products could adversely affect our business and financial results.     Many countries in which we operate regulate the distribution of alcohol products and if those regulations were changed, it could alter our business practices and have a material adverse effect on our business and financial results. For example, in the U.S. market, there is a three-tier distribution system that governs the sale of alcohol beverage products. That system, requiring separation of manufacturers, distributors and retailers, dates back to the repeal of prohibition and is periodically subject to legal challenges. To the extent that such challenges are successful and change the three-tier system, including through the expansion of e-commerce and direct-to-consumer offerings, such changes could have a material adverse effect on our Americas segment results of operations. Further, in Canada, our alcohol beverage products are required to be distributed through certain province's respective provincial liquor board. Additionally, in certain Canadian provinces, we rely on our joint venture arrangements in BRI and BDL to distribute our products via retail outlets that are regulated by provincial government regulators. BRI owns and operates commercial retail outlets, known as The Beer Store ("TBS"), in Ontario and performs delivery services of beer throughout Ontario. BDL facilitates the distribution of our products in the western Canadian provinces. If provincial regulation should change, the costs to adjust our distribution methods could have a material adverse effect on our business and financial results.

Our consolidated financial statements are subject to fluctuations in foreign exchange rates, most significantly the Canadian dollar and the European operating currencies such as the British Pound, Czech Koruna, Euro and Romanian Leu. We hold assets and incur liabilities, earn revenues and pay expenses in different currencies, most significantly in Canada and throughout Europe. Because our financial statements are presented in USD, we must translate our assets, liabilities, income and expenses into USD. Increases and decreases in the value of the USD will affect, at times adversely, the value of these items in our financial statements, even if their local currency value has not changed. Additionally, we are exposed to currency transaction risks related to transactions denominated in currencies other than one of the functional currencies of our operating entities, such as the purchase of certain raw material inputs or capital expenditures, as well as sales transactions and debt issuances or other incurred obligations. Further, certain actions by the government of any of the jurisdictions in which we operate could adversely affect our results and financial position. To the extent that we fail to adequately manage these risks through our risk management policies intended to protect our exposure to currency movements, including if our hedging arrangements do not effectively or completely hedge changes in foreign currency rates, our results of operations may be materially and adversely affected. For instance, the strengthening of the USD against the Canadian dollar, European currencies and various other global currencies would adversely impact our USD reported results due to the impact on foreign currency translation.

Risks Related to Acquisitions and Joint Ventures

Risks associated with operating our joint ventures or other strategic partnerships may materially adversely affect our business and financial results. We have entered into several joint ventures, including our joint ventures with Ball Corporation (i.e., Rocky Mountain Metal Container), and with Owens-Brockway Glass Container Inc. (i.e., Rocky Mountain Bottle Company), for a portion of our aluminum and glass packaging supply in the U.S., respectively. We have also entered into a joint venture with The Yuengling Company LLC to expand the distribution of Yuengling beer in the western U.S. Additionally, in certain Canadian provinces, we rely on joint venture agreements in BRI and BDL to distribute our products via retail outlets that are mandated and regulated by provincial government regulators. Further, in the U.S. in October 2024, we took a majority ownership stake in ZOA Energy LLC ("ZOA"). Additionally, we have a license agreement to import, produce, market, advertise, promote, sell and distribute Fever-Tree products in the U.S. Moreover, we have authorizations from Red Tree Beverages, LLC that grant us the right to produce, market, advertise, promote, sell and distribute products bearing the Simply Spiked trademark in the U.S. and Canada, as well as the Topo Chico Hard Seltzer trademark in the U.S. We may enter into additional joint ventures or other strategic partnerships in the future. Our partners may at any time have economic, business or legal interests or goals that are inconsistent with our goals or with the goals of the joint venture or partnership. In addition, we compete against our partners in certain of our other markets. Disagreements with our business partners may impede our ability to maximize the benefits of our partnerships. Our joint venture arrangements or other partnerships may require us, among other matters, to pay certain costs or to make certain capital investments or to seek our partner's consent to take certain actions. In addition, our partners may be unable or unwilling to meet their economic or other obligations under the operative documents, or may become insolvent or file for bankruptcy protection and we may be required to either fulfill those obligations alone to ensure the ongoing success of the partnership or to dissolve and liquidate. Moreover, as we further develop our own portfolio, we may face challenges meeting all contractual obligations within our current partnerships or having to invest in more marketing assets to sustain partnership brands.

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Failure to successfully identify, complete or integrate attractive acquisitions, joint ventures and other strategic partnerships into our existing operations could have an adverse effect on our business and financial results. We have made a number of acquisitions and entered into several strategic joint ventures and partnerships. In order to compete in the consolidating global brewing and beverage industry, we anticipate that we may, from time to time, in the future acquire additional businesses like the Blue Run Spirits , Inc. ("Blue Run") acquisition in the third quarter of 2023, the increase in our investment in ZOA in the fourth quarter of 2024 and the entry into the partnership with Fevertree Drinks plc in the first quarter of 2025, or enter into additional joint ventures or other partnerships that we believe would provide a strategic fit with our business. Potential risks associated with acquisitions and joint ventures could include, among other things:

• our ability to identify attractive acquisitions, joint ventures and other strategic partnerships;

• our ability to offer potential acquisition targets and joint venture partners' competitive transaction terms;

• our ability to raise capital on reasonable terms to finance attractive acquisitions, joint ventures and other strategic partnerships;

• our ability to realize the benefits or cost savings that we expect to realize as a result of the acquisition, joint venture or other strategic partnerships;

• diversion of management's attention;

• our ability to successfully integrate the business of the acquired company with our business;

• motivating, recruiting and retaining key employees;

• conforming standards, controls, procedures and policies, systems, business cultures and compensation structures among our company and the acquired company;

• consolidating and streamlining sales, marketing and corporate operations;

• potential exposure to unknown liabilities of acquired companies;

• potential exposure to unknown or future liabilities or costs that affect the markets in which acquired companies, joint ventures or strategic partnerships operate;

• reputational or other damage due to the conduct of a joint venture or other partner or the prior conduct of an acquired company;

• loss of key employees and customers of an acquired company;

• managing tax costs or inefficiencies associated with integrating our operations following completion of an acquisition or entry into a joint venture or other partnerships;

• exposure to unfamiliar legal and regulatory requirements entering a new market or jurisdiction;

• incompatibility of technology systems delaying realization of assumed synergies; and

• exchange rate fluctuations triggering material variances between expected financial returns and actual financial returns.

Additional Risks Related to our Americas Segment

Our U.S. business is highly dependent on independent distributors to sell our products, with no assurance that these distributors will effectively sell our products and distributor consolidation in the U.S. could harm our business and financial results.     We sell nearly all of our products, including our imported products, in the U.S. to independent distributors for resale to retail outlets. These independent distributors are entitled to exclusive territories and are often protected from termination by state statutes and regulations. Consequently, if we are not allowed, or are unable under acceptable terms or at all, to replace unproductive or inefficient distributors, our business, financial position and results of operations may be adversely affected, which could have a material adverse effect on our business and financial results.

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Further, in recent years, there has been a consolidation of independent distributors, resulting in distributors with increased leverage over suppliers due to those distributors' share of the supplier business, exclusive territorial appointments and regulatory protection of distribution agreements. We have limited ability to influence decisions regarding distributor consolidation, which, regardless of size, carries a risk of decreased investment in service and local marketing in the interest of paying down the leverage required to fund a transaction. Consolidation among distributors could create a more challenging competitive landscape for our products and could hinder the distribution and sale of our products as distributors could put focus on other brands within their portfolio instead of ours. There is a risk that consolidation of distributors could further increase due to potential changes in tax laws in the markets in which we operate. This could negatively impact sales of our products and increase prices. Our unique portfolio may require more brand building than our competitors, and distributors may not invest the time and other resources to effectively support these brands which could negatively impact our sales. Changes in distributors' strategies, including a reduction in the number of brands they carry or focus on other competitive brands, may adversely affect our growth, business, financial results and/or market share.

Government mandated changes to the retail distribution model resulting from new regulations may have a material adverse effect on our Canada business. In Canada, the retail distribution of alcohol is primarily a provincial responsibility. An Early Implementation Agreement ("EIA") was entered into in May 2024 between the Province of Ontario, Molson Canada 2005, a wholly owned indirect subsidiary of our Company, Labatt Brewing Company Limited, Sleeman Breweries Ltd. (collectively, the "Representative Owners") and Brewers Retail Inc., operating under the name "The Beer Store". The EIA was effective July 18, 2024 and continues until December 31, 2030. The EIA removed grocery store pack size restrictions on beer, wine, cider and RTDs as of July 18, 2024, and allowed for the expansion of licensed sale of beer, wine and RTDs to all convenience stores which began on September 5, 2024 and all eligible grocery and big-box grocery stores as of October 31, 2024. Under the EIA, the Province of Ontario provided 225 million CAD to TBS to financially support the operation of the agreed upon retail footprint during the interim period between the commencement date of the EIA and December 31, 2025. The EIA required TBS to maintain at least 386 retail locations in Ontario to support recycling, cash and carry and to preserve employment through June 30, 2025 and to maintain a minimum of 300 stores from July 1, 2025 until December 31, 2025. From January 1, 2026 onward, TBS has the sole and absolute discretion to maintain or close any retail location. If TBS cannot transition quickly from a retail-led organization to a distribution-led organization, it may adversely impact our business, our results of operations and financial condition. In addition, the result of the Ontario Government's review of all taxes, markups and fees in support of the modern and expanded market remains pending. A new wholesale markup structure is expected to be announced in the first quarter of 2026 and go into effect on April 1, 2026. Other regulatory elements are under review and are subject to change, any of which could have an adverse impact or present new opportunities for our business.

As of January 1, 2026, all licensed grocery and big-box stores are required as a condition of license to accept and sort empty beverage alcohol containers for recycling. Convenience stores are exempt from any recycling requirement. Any licensed grocery store or big-box store that enters into an alternative arrangement with TBS for the recycling of empty containers can seek a regulatory exemption from the condition of license to accept and sort empty containers. As of January 1, 2026, a number of grocery and big-box chains and independent grocery stores have entered into alternative arrangements with TBS under which TBS will have responsibility for collecting the empty container returns on behalf of those grocery and big-box stores (who will not be obligated once exempted from the condition to accept empty containers). The expansion of the number of retail points of sale relative to the number of return locations could interrupt the flow of returnable-refillable bottles and may impact the quality of the returnable-refillable bottle. While the volume of beer sold in the industry standard returnable-refillable bottle has diminished due to consumer preference for one-way aluminum cans, a disruption to the return rate could result in inefficiencies in our operations.

Such impacts of the EIA could have a negative impact on the results of operations, cash flows and financial position of our Americas segment. Similar changes to the beer distribution and retail systems in other Canadian provinces could adversely impact our business, our results of operations and financial condition.

Indemnities provided to the purchaser of our previous interest in the Cervejarias Kaiser Brasil S.A. ("Kaiser") business in Brazil could result in future cash outflows and statement of operations charges.     In 2006, we sold our previous ownership interest in Kaiser, which was held by our Canadian business, to FEMSA Cerveza S.A. de C.V. ("FEMSA"). The terms of the sale agreement require us to indemnify FEMSA for exposures related to certain tax, civil and labor contingencies and certain purchased tax credits. The ultimate resolution of these claims is not under our control. Any probable indemnity obligations are recorded as liabilities on our consolidated balance sheets as appropriate; however, we could incur future statement of operations charges due to changes to our estimates or changes in our assessment of probability of loss on these items as well as due to fluctuations in foreign exchange rates. Due to the uncertainty involved in the ultimate outcome and timing of these contingencies, significant adjustments to the carrying value of our indemnity liabilities and corresponding statement of operations impacts could result in the future.

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Additional Risks Related to our EMEA&APAC Segment

Economic trends and intense competition in European markets could unfavorably affect our profitability. Our European businesses have been, and, in the future may be, adversely affected by conditions in the global financial markets and general economic and political conditions, as well as a weakening of their respective currencies versus the U.S. dollar, in each case, in addition to the other impacts of the Russia-Ukraine conflict. Additionally, intense pricing competition in certain of our European markets, combined with reduced consumer confidence and a decline in consumers' prioritization of the beer category, may adversely reduce sales or profitability. In particular, the on-going focus by large competitors in Europe to drive increased market share through aggressive pricing strategies could adversely affect our sales and results of operations. We may also face pressures resulting from a reduction in disposable incomes of consumers to spend on our products due to inflation, recessionary conditions and an increase in the cost of energy, which could unfavorably affect our profitability. In addition, over time, beer volume sales in the U.K. have been shifting from on-premise, such as pubs and restaurants, to off-premise, such as retail stores, for the industry as a whole. Margins in sales to off-premise customers tend to be lower than margins from sales to on-premise customers, and, as a result, continuation or acceleration of this trend could further adversely affect our profitability. Some of the European markets in which we currently operate face significant public budget deficits, causing governments to introduce new tariffs and tax measures, including increases in value-added-tax and excise taxes or the elimination of certain personal income tax deductions. This, in turn, may generate directly or indirectly further uncertainty in those markets and reduce consumer spend, which could have a material adverse effect on our profitability in those countries.

Risks Related to Ownership of our Class B Common Stock

Shareholder activism efforts or unsolicited takeover proposals could cause a material disruption to our business and financial results. We may be subject to various legal and business challenges due to actions instituted by activist shareholders or unsolicited takeover proposals or other advocacy efforts. Perceived uncertainties as to our future direction as a result of shareholder activism may lead to the perception of a change in the direction of the business or other instability and may affect our relationships with vendors, customers, prospective and current employees and others, as well as potentially increase the chance of additional shareholder activism or other advocacy efforts. Similarly, proposed or future laws and regulations may also increase the chance we become the target of shareholder activist campaigns, including sustainability, human rights and human capital-related actions. If shareholder activist campaigns are initiated against us, our response to such actions could be costly and time-consuming, which could divert the attention and resources of the Board, Chief Executive Officer and senior management from the pursuit of our business strategies, which could harm our business, negatively impact our stock price, and have an adverse effect on our business and financial results.

The interests of the controlling stockholders may differ from those of other stockholders and could prevent our Company from making certain decisions or taking certain actions that would be in the best interest of the other stockholders. Our Class B common stock has fewer voting rights than our Class A common stock, and holders of our Class A common stock have the ability to effectively control or have a significant influence over certain of our actions requiring stockholder approval, which could have a material adverse effect on Class B stockholders. See Part II—Item 8 Financial Statements and Supplementary Data, Note 14, "Stockholders' Equity" in this Annual Report on Form 10-K for additional information regarding voting rights of Class A and Class B stockholders.

If Pentland and the Coors Trust do not agree on a matter submitted to our stockholders or if a super-majority of the Board do not agree on certain actions, generally the matter will not be approved, even if beneficial to us or favored by other stockholders or a majority of the Board.     Pentland Securities (1981) Inc. ("Pentland") (a company controlled by the Molson family and related parties) and the Adolph Coors, Jr. Trust (the "Coors Trust") (a trust controlled by the Coors family and related parties), which together control more than 90% of our Class A common stock and Class A exchangeable shares, have a voting trust agreement through which they have combined their voting power over the shares of our Class A common stock and the Class A exchangeable shares that they own. If these two stockholders do not agree to vote in favor of a matter submitted to a stockholder vote (other than the election of directors), the voting trustees are required to vote all of the Class A common stock and Class A exchangeable shares deposited in the voting trust against the matter. There is no other mechanism in the voting trust agreement to resolve a potential deadlock between these stockholders. Therefore, if either Pentland or the Coors Trust is unwilling to vote in favor of a proposal that is subject to a stockholder vote, we would be unable to implement the proposal even if the Board, management or other stockholders believe the proposal is beneficial to us. Similarly, our bylaws require the authorization of a super-majority (two-thirds) of the Board to take certain transformational actions. Thus, it is possible that we will not be authorized to take action even if it is supported by a simple majority of the Board.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

For more than two centuries, we have brewed beverages that unite people to celebrate all life’s moments. From our core power brands Coors Light , Miller Lite , Coors Banquet , Molson Canadian , Carling and Ožujsko, to our above premium brands including Madrí Excepcional , Staropramen , Blue Moon Belgian White and Leinenkugel’s Summer Shandy , to our value brands like Miller High Life and Keystone Light , we produce many beloved and iconic beers. While our Company's history is rooted in beer, we offer a modern portfolio that expands beyond the beer aisle as well, including flavored beverages like Vizzy Hard Seltzer , spirits and non-alcoholic beverages. We also have partner brands, such as Simply Spiked , ZOA Energy , Fever-Tree , among others, through license, distribution, partnership and joint venture agreements. As a business, our ambition is to be the first choice for our people, our consumers and our customers, and our success depends on our ability to make our products available to meet a wide range of consumer segments and occasions.

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") in this Annual Report on Form 10-K is provided to assist in understanding our Company, operations and current business environment and should be considered a supplement to, and read in conjunction with, the accompanying audited consolidated financial statements and notes included within Part II—Item 8 Financial Statements and Supplementary Data , as well as the discussion of our business and related risk factors in Part I—Item 1 Business and Part I—Item 1A Risk Factors , respectively. See also "Cautionary Statement Pursuant to Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995."

A discussion related to the results of operations and changes in financial condition for 2024 compared to 2023 has been omitted from this report, but may be found in Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in our fiscal 2024 Form 10-K, filed with the SEC on February 18, 2025, which is available free of charge on the SEC's website at www.sec.gov and our corporate website at www.molsoncoors.com. The information provided on our website (or any other website referred to in this report) is not part of this report and is not incorporated by reference as part of this report.

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Our Fiscal Year

Unless otherwise indicated, (a) all $ amounts are in USD, (b) comparisons are to comparable prior periods and (c) 2025, 2024 and 2023 refers to the 12 months ended December 31, 2025, December 31, 2024 and December 31, 2023, respectively.

Global Market Conditions and Competitive Trends

Our industry is experiencing, and we expect will continue to experience, increased consumer and economic uncertainty due to volatility in the global macroeconomic environment including global trade policies and other geopolitical events with potential resulting impacts on economic growth, consumer confidence, inflation and currencies and their exchange rates. In addition, the associated impacts of the macroeconomic environment on the beer industry in the U.S. has resulted in heightened competitive activity and associated reduction in market share of our products in certain segments. The magnitude of the resulting impacts on our business are dependent on the evolution of the global macroeconomic environment and the competitive landscape, including whether market share losses are sustained. The economic and competitive pressures, including the impact of tariffs, on our Company and our consumers' consumption behavior and preferences have negatively impacted, and may continue to negatively impact, our results of operations during this volatile period. For example, tariff announcements in the U.S. in the second quarter of 2025 have indirectly caused the price of the premium on aluminum in the U.S., known as the Midwest Premium, to spike and remain elevated which resulted in an approximate $35 million unfavorable impact on our results for the year ended December 31, 2025 and is expected to continue to adversely impact our results of operations. While our hedging program can help mitigate some of the volatility, the opaque pricing and limited liquidity of the Midwest Premium can make hedging this exposure costly. In addition to impacting the prices of raw materials, a constant or periodic change in the Midwest Premium may decrease our profit margins or we may pass on the increased costs to our consumers which could in turn result in the loss of sales if the end consumer is not willing to pay the increased price. We plan to continue to evaluate and implement strategies which are designed to help mitigate the impact on our business, consolidated results of operations and financial condition while continuing to support our long-term strategic growth and capital allocation priorities.

Chief Executive Officer Succession

On April 12, 2025, Gavin D.K. Hattersley, the then President and CEO of our Company and a then member of the Board, informed our Company and the Board that he intended to retire from our Company and as a member of the Board, in each case, by December 31, 2025.

On September 19, 2025, the Board appointed Rahul Goyal as our Company’s President and CEO and member of the Board effective, in each case, as of October 1, 2025, following the retirement of Gavin D.K. Hattersley from those same positions immediately prior to such appointments. Gavin D.K. Hattersley remained employed by our Company in an advisory role to assist in the transition until December 31, 2025.

Items Affecting Reported Results

Items Affecting the Consolidated Results of Operations

Purchases of Annuity Contracts

On September 26, 2024, we purchased annuity contracts for two of our Canadian pension plans. As a result, on September 30, 2024, we remeasured both pension plans and recorded a total settlement loss of $34.0 million to other pension and postretirement benefit (costs), net in our consolidated statements of operations during the third quarter of 2024. See Part II—Item 8 Financial Statements and Supplementary Data, Note 11, "Employee Retirement Plans and Postretirement Benefits" and Part II—Item 8 Financial Statements and Supplementary Data, Note 15, "Accumulated Other Comprehensive Income (Loss)" for further information.

Cobra Beer Partnership, Ltd. Buyout

During March 2024, our partner in Cobra Beer Partnership, Ltd. ("CBPL") exercised a put option under our partnership agreement which required us to acquire the remaining 49.9% ownership interest. We adjusted the NCI by $34.5 million to our best estimate of the redemption value that existed at the time of the put option exercise by increasing net income attributable to noncontrolling interests and decreasing our net income attributable to MCBC. In addition, we received the final determination of the redemption value in October 2024 and as the transaction was considered mandatorily redeemable, we recorded an adjustment of $45.8 million to interest expense in the EMEA&APAC segment during the third quarter of 2024. The transaction was finalized on October 21, 2024, resulting in a cash payment of $89 million which was recorded as a cash outflow from financing activities.

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Items Affecting the Americas Segment Results of Operations

Americas Restructuring Plan

On October 20, 2025, we announced an Americas Restructuring Plan designed to create a leaner, more agile Americas segment while advancing our ability to reinvest in the business and position our Company for future growth. The plan resulted in charges of $28.7 million, primarily related to severance payments and post-employment benefits, recorded to other operating income (expense), net in our consolidated statements of operations during the year ended December 31, 2025. The remaining charges, predominantly employee-related charges, for the Americas Restructuring Plan are expected to be recorded during the year ended December 31, 2026 and total restructuring charges are expected to be at the low end of the previously communicated range of $35 million to $50 million at approximately $35 million.

Goodwill Impairment

During the third quarter of 2025, we recorded a partial goodwill impairment charge of $3,645.7 million to goodwill impairment in our consolidated statement of operations related to our Americas reporting unit. See Part II—Item 8 Financial Statements and Supplementary Data, Note 6, "Goodwill and Intangible Assets" for further information.

Intangible Asset Impairment

During the third quarter of 2025, we recorded a full impairment charge of $75.3 million related to our Blue Run Spirits definite-lived intangible asset within other operating income (expense), net in our consolidated statements of operations. See Part II—Item 8 Financial Statements and Supplementary Data, Note 6, "Goodwill and Intangible Assets" for further information.

Fevertree Transactions

During the first quarter of 2025, we obtained exclusive rights via a license agreement to import, produce, market, advertise, promote, sell and distribute Fever-Tree products in the U.S. In connection with this agreement, we acquired the shares of the Fevertree USA, Inc. entity, with the immaterial acquisition accounted for as a business combination and consideration allocated primarily to working capital balances. The acquisition is aligned with our strategy to expand beyond the beer aisle.

ZOA Energy

On October 31, 2024, we further increased our investment in ZOA bringing our ownership interest to 51%. Upon conversion from equity method accounting to consolidation accounting, we recognized a gain of $77.9 million in other operating income (expense), net in the consolidated statements of operations. See Part II—Item 8 Financial Statements and Supplementary Data, Note 3, "Investments" for further information.

Wind Down or Sale of Certain U.S. Craft Businesses

During the third quarter of 2024, we decided to wind down or sell certain of our U.S. craft businesses and related facilities. We recorded accelerated depreciation in excess of normal depreciation of $17.9 million and $93.6 million during the year ended December 31, 2025 and December 31, 2024, respectively. In addition, during the year ended December 31, 2024, we recognized a loss of $41.2 million related to the disposal of the sold businesses. Restructuring charges related to these actions are complete. See Part II—Item 8 Financial Statements and Supplementary Data, Note 17, "Other Operating Income (Expense), net" for further information.

Items Affecting the EMEA&APAC Segment Results of Operations

Intangible Asset Impairment

During the third quarter of 2025, we recorded a partial impairment charge of $198.6 million related to the Staropramen family of brands indefinite-lived intangible asset within other operating income (expense), net in our consolidated statements of operations. See Part II—Item 8 Financial Statements and Supplementary Data, Note 17, "Other Operating Income (Expense), net" for further information.

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Consolidated Results of Operations

The following table highlights summarized components of our consolidated statements of operations for the years ended December 31, 2025, December 31, 2024 and December 31, 2023. See Part II—Item 8 Financial Statements and Supplementary Data, “Consolidated Statements of Operations” for additional details of our U.S. GAAP results comparing December 31, 2025 and December 31, 2024.

For the years ended

December 31, 2025

% Change

December 31, 2024

% Change

December 31, 2023

(In millions, except percentages and per share data)

Net sales

Cost of goods sold

Gross profit

Marketing, general and administrative expenses

Goodwill impairment

Other operating income (expense), net

Equity income (loss)

Operating income (loss)

Total non-operating income (expense), net

Income (loss) before income taxes

Income tax benefit (expense)

Net income (loss)

Net (income) loss attributable to noncontrolling interests

Net income (loss) attributable to MCBC

Net income (loss) attributable to MCBC per diluted share

Financial volume in hectoliters

N/M = Not meaningful

Foreign currency impacts on results

For the year ended December 31, 2025, foreign currency movements had the following impacts on our USD consolidated results of operations:

• Net sales - Favorable impact of $77.6 million (favorable impact for EMEA&APAC of $99.0 million, partially offset by the unfavorable impact for Americas of $21.4 million).

• Cost of goods sold - Unfavorable impact of $50.1 million (unfavorable impact for EMEA&APAC of $63.6 million, partially offset by the favorable impact for Americas of $13.5 million).

• MG&A - Unfavorable impact of $15.3 million (unfavorable impact for EMEA&APAC of $22.5 million, partially offset by the favorable impact for Americas of $7.2 million).

• Other operating income (expense), net - Unfavorable impact of $15.6 million (unfavorable impact for EMEA&APAC and Americas of $15.5 million and $0.1 million, respectively).

• Income (loss) before income taxes - Unfavorable impact of $2.5 million (unfavorable impact for Unallocated of $3.8 million, partially offset by the favorable impact for EMEA&APAC of $1.3 million).

The impacts of foreign currency movements on our consolidated USD results described above for the year ended December 31, 2025, were primarily due to the weakening of the USD compared to the GBP, EUR and CZK, partially offset by the strengthening of the USD compared to the CAD.

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Included in these amounts are both translational and transactional impacts of changes in foreign exchange rates. We calculate the impact of foreign exchange by translating our current period local currency results at the average exchange rates used to translate the financial statements in the comparable prior year period during the respective period throughout the year and comparing that amount with the reported amount for the period. The impact of transactional foreign currency gains and losses is recorded within other non-operating income (expense), net in our consolidated statements of operations.

Volume

Financial volume represents owned or actively managed brands sold to unrelated external customers within our geographic markets (net of returns and allowances), as well as contract brewing, factored non-owned volume and company-owned distribution volume. This metric is presented on a sales-to-wholesalers basis to reflect the sales from our operations to our direct customers, generally distributors. We believe this metric is important and useful for investors and management because it gives an indication of the amount of beer and adjacent products that we have produced and shipped to customers. This metric excludes royalty volume, which consists of our brands produced and sold under various license and contract brewing agreements. Factored volume in our EMEA&APAC segment represents the distribution of beer, wine, spirits and other products owned and produced by other companies to the on-premise channel, which is a common arrangement in the U.K.

Net sales

We utilize net sales per hectoliter, as well as the year over year changes in this metric, as a key metric for analyzing our results. This metric is calculated as net sales per our consolidated statements of operations divided by financial volume for the respective period. We believe this metric is important and useful for investors and management because it provides an indication of the trends of price and sales mix and other impacts on our net sales.

The following table highlights the drivers of the change in net sales for the year ended December 31, 2025, compared to December 31, 2024, (in percentages):

Financial Volume

Price and Sales Mix

Currency

Total

Consolidated net sales

Net sales decreased 4.2% for the year ended December 31, 2025, compared to prior year, driven by lower financial volume, partially offset by favorable price and sales mix and favorable foreign currency impacts.

Financial volume decreased 8.6% for the year ended December 31, 2025, compared to prior year, primarily due to lower shipments in both the Americas and EMEA&APAC segments as described in further detail in the “Segment Results of Operations” section below.

Price and sales mix favorably impacted net sales by 3.8% for the year ended December 31, 2025, primarily due to favorable sales mix and increased net pricing in both segments. Americas favorable sales mix was primarily driven by lower contract brewing volume and positive brand mix. Net sales per hectoliter increased 4.8%.

A discussion of currency impacts on net sales is included in the "Foreign currency impacts on results" section above.

Cost of goods sold

We utilize cost of goods sold per hectoliter, as well as the year over year changes in this metric, as a key metric for analyzing our results. This metric is calculated as cost of goods sold per our consolidated statements of operations divided by financial volume for the respective period. We believe this metric is important and useful for investors and management because it provides an indication of the trends of mix and other cost impacts on our cost of goods sold.

Cost of goods sold decreased 3.2% for the year ended December 31, 2025, compared to prior year, primarily due to lower financial volume, partially offset by higher cost of goods sold per hectoliter and the unfavorable foreign currency impact of $50.1 million. Cost of goods sold per hectoliter incr eased 5.8% for the year ended December 31, 2025, compared to prior year, primarily due to unfavorable mix driven by lower contract brewing volume in the Americas segment and premiumization, volume deleverage, cost inflation related to materials and manufacturing expenses including an approximate $35 million unfavorable impact to cost of goods sold attributable to Midwest Premium pricing as well as unfavorable foreign currency impact, partially offset by cost savings initiatives.

A discussion of currency impacts on cost of goods sold is included in the "Foreign currency impacts on results" section above.

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Marketing, general and administrative expenses

MG&A expenses decreased 2.7% for the year ended December 31, 2025, compared to prior year, primarily due to lower short-term incentive compensation expense of approximately $70 million and lower marketing investment, partially offset by approximately $30 million of integration and transition fees from the Fevertree USA, Inc. acquisition which will be recoverable through net sales over the next 3 years which started in the second quarter of 2025 and costs incurred related to our global modernization ERP system implementation project.

A discussion of currency impacts on marketing, general and administrative expenses is included in the "Foreign currency impacts on results" section above.

Goodwill impairment

During the third quarter of 2025, we identified a triggering event that indicated it was more likely than not that the carrying value of the Americas reporting unit exceeded its fair value resulting in a $3,645.7 million partial goodwill impairment charge. See Part II—Item 8 Financial Statements and Supplementary Data, Note 6, "Goodwill and Intangible Assets" for further information regarding the recorded impairment.

Other operating income (expense), net

Other operating expense, net declined $269.9 million for the year ended December 31, 2025, compared to prior year, primarily due to intangible asset impairments of $273.9 million, the cycling of a $77.9 million gain recognized upon the consolidation of ZOA in the fourth quarter of 2024 and restructuring charges of $28.7 million related to our Americas Restructuring Plan, partially offset by the cycling of a prior year loss on the decision to wind down or sell certain of our U.S. craft businesses.

A discussion of currency impacts on other operating income (expense), net is included in the "Foreign currency impacts on results" section above.

Total non-operating income (expense), net

Total non-operating expense, net improved 27.6% for the year ended December 31, 2025, compared to prior year, primarily due to the cycling of a prior year $45.8 million adjustment recorded to interest expense to increase our mandatorily redeemable NCI liability to the final redemption value related to the CBPL buyout, the cycling of a prior year settlement loss of $34.0 million recorded as a result of Canadian pension plan annuity purchases and a favorable $31.7 million unrealized fair value adjustment of the investment in Fevertree Drinks plc in the current year, partially offset by lower interest income, lower pension and OPEB non-service benefit and higher interest expense as a result of the issuance of EUR 800 million 3.8% senior notes in the second quarter of 2024.

Income tax benefit (expense)

For the years ended

December 31, 2025

December 31, 2024

December 31, 2023

Effective tax rate

Our effective tax rate decreased for the year ended December 31, 2025, compared to the prior year, primarily due to the impact of the $3,645.7 million partial goodwill impairment, a portion of which was not deductible for tax purposes. The decrease was also driven by the cycling of a $45.8 million increase in the mandatorily redeemable noncontrolling interest liability of CBPL to its final redemption value, which was recorded to interest expense in the third quarter of 2024 and was nondeductible for tax purposes. These decreases were offset in part by the cycling a $77.9 million nontaxable gain recognized upon the consolidation of ZOA in the fourth quarter of 2024.

Our effective tax rate can be volatile and may change with, among other things, the amount and source of pretax income or loss, our ability to utilize foreign tax credits, excess tax benefits or deficiencies from share-based compensation, changes in tax laws and the movement of liabilities established pursuant to accounting guidance for uncertain tax positions as statutes of limitations expire, positions are effectively settled or when additional information becomes available. There are proposed or pending tax law changes in various jurisdictions and other changes to regulatory environments in countries in which we do business that, if enacted, could have an impact on our effective tax rate.

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On July 4, 2025, the OBBBA was enacted into law in the U.S. The OBBBA includes various provisions which permanently extend certain expiring provisions from the Tax Cuts and Jobs Act of 2017, many of which have different effective dates. Changes in the OBBBA include the accelerated tax recovery for certain capital investments and research and development expenditures, and changes to the business interest expense limitation. Additionally, the OBBBA includes changes to the taxation of foreign income for U.S.-domiciled businesses. While the OBBBA did not materially affect our effective tax rate for the year ended December 31, 2025, it reduced our cash tax payments by approximately $80 million. We are continuing to assess the potential impact of OBBBA changes that become effective after 2025 on our consolidated financial statements.

For a comprehensive view of the income taxes we pay globally, our total tax contribution (inclusive of both income and non‑income taxes), and our approach to being a responsible corporate tax citizen in all jurisdictions in which we operate, refer to Our Imprint Report available at www.molsoncoors.com/goals-and-reporting. Our total tax contribution may be affected by, among other factors, changes to existing tax laws or the enactment of new tax policies, regulations, guidance, or laws, as well as the final resolution of tax audits and any related litigation. The information provided on our website (or any other website referred to in this report) is not part of this report and is not incorporated by reference as part of this report.

Refer to Part II—Item 8 Financial Statements and Supplementary Data, Note 12, "Income Tax" for further discussion regarding our effective tax rate.

Net income (loss) attributable to noncontrolling interests

Net loss attributable to noncontrolling interests of $40.6 million declined $75.9 million for the year ended December 31, 2025, from income of $35.3 million in the prior year. The current year loss was primarily related to the allocation of the Americas reporting unit goodwill impairment and the Blue Run Spirits intangible asset impairment, partially offset by redemption value adjustments. The prior year income was driven by an increase in one of the noncontrolling interests to its redemption value.

Segment Results of Operations

Americas Segment

For the years ended

December 31, 2025

% Change

December 31, 2024

% Change

December 31, 2023

(In millions, except percentages)

Net sales (1)

Income (loss) before income taxes

Financial volume in hectoliters (1)(2)

N/M = Not meaningful

(1) Includes gross inter-segment sales and volume which are eliminated in the consolidated totals.

(2) Excludes royalty volume of 2.852 million hectoliters, 2.550 million hectoliters and 2.683 million hectoliters for the years ended December 31, 2025, 2024 and 2023, respectively.

Net sales

The following table highlights the drivers of the change in net sales for the year ended December 31, 2025, compared to December 31, 2024, (in percentages):

Financial Volume

Price and Sales Mix

Currency

Total

Americas net sales

Net sales decreased 5.7% for the year ended December 31, 2025, compared to prior year, driven by lower financial volume and unfavorable foreign currency impacts, partially offset by favorable price and sales mix.

Financial volumes decreased 9.2% for the year ended December 31, 2025, compared to prior year, primarily due to lower U.S. volume impacted by the macroeconomic environment resulting in industry softness as well as lower share performance and an approximate 3% impact from lower contract brewing volume resulting from the exit of contract brewing arrangements in the U.S. and Canada.

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Price and sales mix favorably impacted net sales by 3.7%, for the year ended December 31, 2025, primarily due to favorable sales mix as a result of lower contract brewing volume and positive brand mix as well as increased net pricing. Net sales per hectoliter increased 3.8%.

A discussion of currency impacts on net sales is included in the "Foreign currency impacts on results" section above.

Income (loss) before income taxes

Loss before income taxes of $2,343.6 million decreased $3,866.9 million for the year ended December 31, 2025, compared to income before income taxes in the prior year, primarily due to a $3,645.7 million partial goodwill impairment charge, lower financial volume, cost inflation related to materials and manufacturing expenses including an approximate $35 million unfavorable impact attributable to Midwest Premium pricing, higher other operating expense, net and costs incurred related to our global modernization ERP system implementation project, partially offset by favorable mix, increased net pricing, cost savings initiatives, lower MG&A expenses driven by lower short-term incentive compensation expense of approximately $50 million and lower marketing investment as well as favorable unrealized fair value adjustment of the investment in Fevertree Drinks plc.

Higher other operating expense, net, was primarily due to the cycling of a $77.9 million gain recognized upon the consolidation of ZOA in the fourth quarter of 2024, a $75.3 million full impairment charge to our definite-lived intangible asset related to the Blue Run Spirits asset group and restructuring charges of $28.7 million related to our Americas Restructuring Plan, partially offset by cycling the wind down and sale of certain of our U.S. craft businesses and related restructuring costs.

A discussion of currency impacts on income (loss) before income taxes is included in the "Foreign currency impacts on results" section above.

EMEA&APAC Segment

For the years ended

December 31, 2025

% Change

December 31, 2024

% Change

December 31, 2023

(In millions, except percentages)

Net sales (1)

Income (loss) before income taxes

Financial volume in hectoliters (1)(2)

N/M = Not meaningful

(1) Includes gross inter-segment sales and volumes which are eliminated in the consolidated totals.

(2) Excludes royalty volume of 1.224 million hectoliters, 1.185 million hectoliters and 0.935 million hectoliters for the years ended December 31, 2025, 2024 and 2023, respectively.

Net sales

The following table highlights the drivers of the change in net sales for the year ended December 31, 2025, compared to December 31, 2024 (in percentages):

Financial Volume

Price and Sales Mix

Currency

Total

EMEA&APAC net sales

Net sales increased 1.8% for the year ended December 31, 2025, compared to prior year, driven by price and sales mix and favorable foreign currency impacts, partially offset by lower financial volume.

Financial volume decreased 6.8% for the year ended December 31, 2025, compared to prior year, primarily due to lower volume across all regions driven by soft market demand and a heightened competitive landscape.

Price and sales mix favorably impacted net sales by 4.5% for the year ended December 31, 2025, primarily due to premiumization, geographic mix and higher factored brand volume, as well as increased net pricing. Net sales per hectoliter increased 9.3%.

A discussion of currency impacts on net sales is included in the "Foreign currency impacts on results" section above.

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Income (loss) before income taxes

Loss before income taxes of $13.1 million declined $158.4 million for the year ended December 31, 2025, compared to income before income taxes in the prior year, primarily due to the partial impairment charge of $198.6 million to the indefinite-lived intangible asset related to the Staropramen family of brands, lower financial volume and higher U.K. waste management fees as a result of the implementation of the Extended Producer Responsibility regulations, partially offset by lower MG&A expenses driven by lower incentive compensation expense of approximately $20 million and targeted cost reductions, the cycling of a prior year $45.8 million adjustment recorded to interest expense to increase our mandatorily redeemable NCI liability to the final redemption value related to the CBPL buyout and increased net pricing.

A discussion of currency impacts on income (loss) before income taxes is included in the "Foreign currency impacts on results" section above.

Unallocated Segment

We have certain activity that is not allocated to our segments, which has been reflected as Unallocated below. Specifically, Unallocated primarily includes certain financing-related activities such as interest expense and interest income, as well as foreign exchange gains and losses on intercompany balances. Unallocated activity also includes the unrealized changes in fair value on our commodity swaps not designated in hedging relationships recorded within cost of goods sold, which are later reclassified when realized to the segment in which the exposure resides. Additionally, only the service cost component of net periodic pension and OPEB cost is reported within each operating segment. Meanwhile, all other components remain in Unallocated.

For the years ended

December 31, 2025

% Change

December 31, 2024

% Change

December 31, 2023

(In millions, except percentages)

Cost of goods sold

Gross profit (loss)

Operating income (loss)

Total non-operating income (expense), net

Income (loss) before income taxes

N/M = Not meaningful

Cost of goods sold

The unrealized changes in fair value on our commodity derivatives, which are economic hedges, make up substantially all of the activity presented within cost of goods sold in the table above for the years ended December 31, 2025, 2024 and 2023. As the exposure we are managing is realized, we reclassify the gain or loss on our commodity derivatives to the segment in which the underlying exposure resides, allowing our segments to realize the economic effects of the derivative without the resulting unrealized mark-to-market volatility. See Part II—Item 8 Financial Statements and Supplementary Data, Note 10, "Derivative Instruments and Hedging Activities" for further information.

Total non-operating income (expense), net

Total non-operating expense, net increased 5.7% for the year ended December 31, 2025, compared to prior year, primarily due to lower pension and OPEB non-service benefit, lower interest income, higher interest expense as a result of the issuance of EUR 800 million 3.8% senior notes in the second quarter of 2024 as well as unfavorable foreign currency transactional impacts, partially offset by the cycling of a prior year settlement loss of $34.0 million recorded as a result of Canadian pension plan annuity purchases.

See Part II - Item 8 Financial Statements and Supplementary Data, Note 11, "Employee Retirement Plans and Postretirement Benefits" for further discussion of our pension and OPEB plans.

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Liquidity and Capital Resources

Liquidity

Overview

Our primary sources of liquidity include cash provided by operating activities and access to external capital. We continue to monitor world events which may create credit or economic challenges that could adversely impact our net income (loss) or operating cash flows and our ability to obtain additional liquidity. We believe that our cash and cash equivalents, cash flows from operations and cash provided by short-term and long-term borrowings, when necessary, will be adequate to meet our ongoing operating requirements, scheduled principal and interest payments on debt, anticipated dividend payments, capital expenditures and other obligations for the twelve months subsequent to the date of the issuance of this report and our long-term liquidity requirements. We have upcoming debt maturities in 2026, as illustrated in the debt maturity schedule in the cash and cash equivalents section below. We are currently evaluating various alternatives with respect to these maturities, including the potential refinancing of all or a portion of the outstanding debt which may involve utilizing our amended and restated $2.0 billion multi-currency revolving credit facility. We have not made a decision at this time, and the timing, structure and terms of any such transactions will depend on capital market conditions and other factors. There can be no assurance that such transactions, including a potential refinancing, will be pursued or completed on terms acceptable to the Company. We do not have any restrictions that prevent or limit our ability to declare or pay dividends.

While a significant portion of our cash flows from operating activities are generated within the U.S., our cash balances include cash held outside the U.S. and in currencies other than the USD. As of December 31, 2025, approximately 57% of our cash and cash equivalents were located outside the U.S., largely denominated in foreign currencies. F luctuations in foreign currency exchange rates could have a material impact on these foreign cash balances. Cash balances in foreign countries are often subject to additional restrictions. We may, therefore, have difficulties repatriating cash held outside the U.S. on a timely basis and such repatriation may be subject to tax. These limitations may affect our ability to fully utilize our cash resources for needs in the U.S. and other countries and may adversely affect our liquidity. To the extent necessary, we accrue for tax consequences on the earnings of our foreign subsidiaries as they are earned. We may utilize tax planning and financing strategies in an effort to ensure that our worldwide cash is available in the locations in which it is needed. We periodically review and evaluate these plans and strategies, including externally committed and non-committed credit agreements accessible by our Company and each of our operating subsidiaries. We believe these financing arrangements, along with cash flows from operating activities within the U.S., are sufficient to fund our current cash needs in the U.S.

Guarantor Information

SEC Registered Securities

For purposes of this disclosure, including the tables, "Parent Issuer" shall mean MCBC in its capacity as the issuer of the senior notes under the May 2012 Indenture, the July 2016 Indenture and the May 2024 Indenture. "Subsidiary Guarantors" shall mean certain Canadian and U.S. subsidiaries reflecting the substantial operations of our Americas segment.

Pursuant to the indenture dated May 3, 2012 (as amended, the "May 2012 Indenture"), MCBC issued its outstanding 5.0% senior notes due 2042. Additionally, pursuant to the indenture dated July 7, 2016 ("July 2016 Indenture"), MCBC issued its outstanding 3.0% senior notes due 2026 and 4.2% senior notes due 2046. Further, pursuant to the indenture dated May 29, 2024 ("May 2024 Indenture"), MCBC issued its outstanding 3.8% senior notes due 2032. The issuances of the senior notes issued under the May 2012 Indenture, the July 2016 Indenture and the May 2024 Indenture were registered under the Securities Act of 1933, as amended. These senior notes are guaranteed on a senior unsecured basis by certain subsidiaries of MCBC, which are listed in Exhibit 22 of this Annual Report on Form 10-K (the Subsidiary Guarantors, and together with the Parent Issuer, the "Obligor Group"). Each of the Subsidiary Guarantors is 100% owned by the Parent Issuer. The guarantees are full and unconditional and joint and several.

None of our other outstanding debt was issued in a transaction that was registered with the SEC, and such other outstanding debt was issued or otherwise generally guaranteed on a senior unsecured basis by the Obligor Group or other consolidated subsidiaries of MCBC. These other guarantees are also full and unconditional and joint and several.

As of December 31, 2025, the senior notes and related guarantees ranked pari-passu with all other unsubordinated debt of the Obligor Group and senior to all future subordinated debt of the Obligor Group. The guarantees can be released upon the sale or transfer of a Subsidiary Guarantors' capital stock or substantially all of its assets, or if such Subsidiary Guarantor ceases to be a guarantor under our other outstanding debt.

See Part II—Item 8 Financial Statements and Supplementary Data, Note 9, "Debt" for details of all debt issued and outstanding as of December 31, 2025.

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The following summarized financial information relates to the Obligor Group as of December 31, 2025, on a combined basis, after elimination of intercompany transactions and balances between the Obligor Group, and excluding the investments in and equity in the earnings of any non-guarantor subsidiaries. The balances and transactions with non-guarantor subsidiaries have been separately presented.

Summarized Financial Information of Obligor Group

Year ended December 31, 2025

(In millions)

Net sales, out of which:

Intercompany sales to non-guarantor subsidiaries

Gross profit, out of which:

Intercompany net costs from non-guarantor subsidiaries

Net interest expense, out of which:

Intercompany net interest expense from non-guarantor subsidiaries

Loss before income taxes

Net loss

As of December 31, 2025

(In millions)

Total current assets, out of which:

Intercompany receivables from non-guarantor subsidiaries

Total noncurrent assets, out of which:

Noncurrent intercompany notes receivable from non-guarantor subsidiaries

Total current liabilities, out of which:

Current portion of long-term debt and short-term borrowings

Intercompany payables due to non-guarantor subsidiaries

Total noncurrent liabilities, out of which:

Long-term debt

Noncurrent intercompany notes payable due to non-guarantor subsidiaries

Cash Flows and Use of Cash

Our business historically generates positive operating cash flows each year and our debt is generally of a longer-term nature. See the debt maturity profile graph below or refer to Part II—Item 8 Financial Statements and Supplementary Data, Note 9, "Debt" for further details of our debt maturity profile. However, our liquidity could be impacted significantly by the risk factors described in Part I—Item 1A. Risk Factors .

Cash Flows from Operating Activities

Net cash provided by operating activities of $1,784.4 million for the year ended December 31, 2025, decreased $125.9 million from $1,910.3 million for the year ended December 31, 2024, primarily due to lower net income adjusted for non-cash items, a $60.6 million payment as final resolution of the Keystone litigation case and higher interest paid, partially offset by lower payments for prior year annual incentive compensation and lower income taxes paid including the approximate $80 million impact from the passage of the OBBBA in the U.S. and the favorable timing of working capital.

Cash Flows from Investing Activities

Net cash used in investing activities of $822.1 million for the year ended December 31, 2025, increased $174.1 million from $648.0 million for the year ended December 31, 2024. The increase in cash used in investing activities was primarily due to our investment in Fevertree Drinks plc of $88.1 million, higher capital expenditures as a result of the timing of capital projects and the acquisition of Fevertree USA, Inc., partially offset by cycling the net proceeds from the sale of the U.S. craft businesses in the prior year.

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Cash Flows from Financing Activities

Net cash used in financing activities of $1,056.8 million for the year ended December 31, 2025, decreased $81.6 million from $1,138.4 million for the year ended December 31, 2024. The decrease in cash used in financing activities was primarily due to the prior year payment to acquire the noncontrolling interest in CBPL.

Capital Resources, including Material Cash Requirements

Cash and Cash Equivalents

As of December 31, 2025, we had total cash and cash equivalents of $896.5 million, compared to $969.3 million as of December 31, 2024. The decrease in cash and cash equivalents from December 31, 2024, was primarily due to capital expenditures, Class B common stock share repurchases, dividends paid, as well as our investment in Fevertree Drinks plc and the acquisition of Fevertree USA, Inc., partially offset by net cash provided by operating activities. See Part II—Item 8 Financial Statements and Supplementary Data, Consolidated Statements of Cash Flows for additional detail.

The majority of our cash and cash equivalents are invested in a variety of highly liquid investments with original maturities of 90 days or less. These investments are viewed by management as low-risk investments on which there are little to no restrictions regarding our ability to access the underlying cash to fund our operations as necessary. While we have some investments in prime money market funds at times, these are classified as cash and cash equivalents; however, we continually monitor the need for reclassification under the SEC requirements for money market funds and the potential that the shares of such funds could have a net asset value of less than one dollar. We also utilize cash pooling arrangements to facilitate the access to cash across our geographies.

Working Capital

We actively manage our working capital to ensure we are able to meet our short-term obligations and to provide more favorable timing of cash inflows. These efforts include optimizing our inventory levels and managing our payment terms on accounts payable and accounts receivable.

Borrowings

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Based on the credit profile of our lenders that are party to our credit facilities, we are confident in our ability to draw on our revolving credit facility if the need arises. On June 26, 2025, we amended our existing $2.0 billion multi-currency revolving credit facility to extend the maturity date from June 26, 2029 to June 26, 2030. As of December 31, 2025, we had $2.0 billion available to draw on our amended and restated $2.0 billion multi-currency revolving credit facility. As of December 31, 2025, we had no borrowings drawn on this amended and restated multi-currency revolving credit facility and no commercial paper borrowings.

We intend to further utilize our cross-border, cross currency cash pool as well as our commercial paper programs for liquidity as needed. We also have CAD, GBP and USD overdraft facilities across several banks should we need additional short-term liquidity.

Under the terms of each of our debt facilities, we must comply with certain restrictions. These include customary events of default and specified representations, warranties and covenants, as well as covenants that restrict our ability to incur certain additional priority indebtedness (certain thresholds of secured consolidated net tangible assets), certain leverage threshold percentages, create or permit liens on assets and restrictions on mergers, acquisitions and certain types of sale lease-back transactions.

The maximum net debt to EBITDA leverage ratio, as defined by the amended and restated multi-currency revolving credit facility agreement, was 4.00x as of December 31, 2025, and December 31, 2024. As of December 31, 2025 and December 31, 2024, we were in compliance with all of these restrictions and covenants, have met such financial ratios and have met all debt payment obligations. All of our outstanding senior notes as of December 31, 2025, rank pari-passu.

See Part II—Item 8 Financial Statements and Supplementary Data, Note 9, "Debt" for further discussion of our borrowings and available sources of borrowings, including lines of credit.

Guarantees

We guarantee indebtedness and other obligations to banks and other third parties for some of our equity method investments and consolidated subsidiaries. See Part II - Item 8 Financial Statements and Supplementary Data, Note 3, "Investments" and Part II - Item 8 Financial Statements and Supplementary Data, Note 13, "Commitments and Contingencies" for further discussion.

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Material Cash Requirements from Contractual and Other Obligations

A summary of our material cash requirements from our contractual and other obligations as of December 31, 2025, based on foreign exchange rates as of December 31, 2025, was as follows.

Payments due by period

Total

2031 and thereafter

(In millions)

Debt obligations excluding finance leases

Interest payments on debt obligations

Finance leases

Retirement plan expenditures (1)

Operating leases

Other long-term obligations (2)

Total obligations

See Part II—Item 8 Financial Statements and Supplementary Data, Note 9, "Debt," Note 8, "Leases," Note 11, "Employee Retirement Plans and Postretirement Benefits," Note 10, "Derivative Instruments and Hedging Activities," and Note 13, "Commitments and Contingencies" for additional information.

(1) Primarily represents expected benefit payments under our OPEB plans through 2035. The net underfunded liability as of December 31, 2025, of our defined benefit pension plans (excluding our overfunded plans) and OPEB plans was $34.1 million and $435.1 million, respectively. Defined benefit pension plan contributions in future years will vary based on a number of factors, including actual plan asset returns and interest rates, and thus, have been excluded from the above table.

(2) See Part II—Item 8 Financial Statements and Supplementary Data, Note 13, "Commitments and Contingencies" for further discussion of the majority of the other long-term obligations which includes supply and distribution and advertising and promotions commitments. The remaining balance relates to royalty payments, information technology services, derivative payments, pre-commencement leases and other commitments.

Other Commercial Commitments

Based on foreign exchange rates as of December 31, 2025, future commercial commitments were as follows:

Amount of commitment expiration per period

Total amounts

committed

2031 and thereafter

(In millions)

Standby letters of credit

(1) Includes $10.7 million of letters of credit each of which contain a feature that automatically renews for an additional year if no cancellation notice is submitted. See Part II—Item 8 Financial Statements and Supplementary Data, Note 13, "Commitments and Contingencies" for further discussion.

Credit Rating

Our current long-term credit ratings are BBB/Stable Outlook, Baa1/Stable Outlook and BBB/Stable Outlook with Standard & Poor's, Moody's and DBRS, respectively. Our short-term credit ratings are A-2, Prime-2 and R-2, respectively. A securities rating is not a recommendation to buy, sell or hold securities, and it may be revised or withdrawn at any time by the applicable rating agency.

Capital Expenditures

We incurred $667.4 million and paid $716.6 million for capital improvement projects worldwide for the year ended December 31, 2025, excluding capital spending by equity method joint ventures, representing a decrease of $53.4 million from the $720.8 million of capital expenditures incurred in the year ended December 31, 2024. We continue to prioritize our planned capital expenditures with a focus on optimizing returns on invested capital.

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Contingencies

We are party to various legal proceedings arising in the ordinary course of business, environmental matters, and indemnities associated with our sale of Kaiser to FEMSA. See Part II—Item 8 Financial Statements and Supplementary Data, Note 13, "Commitments and Contingencies" for further discussion.

Off-Balance Sheet Arrangements

Refer to Part II—Item 8 Financial Statements and Supplementary Data, Note 13, "Commitments and Contingencies" for discussion of off-balance sheet arrangements. As of December 31, 2025, we did not have any other material off-balance sheet arrangements.

Critical Accounting Estimates

Our consolidated financial statements are prepared in accordance with U.S. GAAP. In connection with the preparation of our consolidated financial statements, we are required to make judgments and estimates that significantly affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures. Our estimates are based on historical experience, current trends and various other assumptions we believe to be relevant under the circumstances. We review the underlying factors used in our estimates regularly, including reviewing the significant accounting policies impacting the estimates, to ensure compliance with U.S. GAAP. However, due to the uncertainty inherent in our estimates, actual results may be materially different. We have identified the accounting estimates below as critical to understanding and evaluating the financial results reported in our consolidated financial statements.

For a complete description of our significant accounting policies, see Part II—Item 8 Financial Statements and Supplementary Data, Note 1, "Basis of Presentation and Summary of Significant Accounting Policies . "

Pension and Other Postretirement Benefits

Our defined benefit pension plans cover certain current and former employees in the U.S., Canada and the U.K. Benefit accruals for the majority of employees in our U.S. and U.K. plans are frozen and the plans are closed to new entrants. In the U.S., we also participate in, and make contributions to, multi-employer pension plans. Further, our OPEB plans provide medical benefits for retirees and their eligible dependents as well as life insurance and, in some cases, dental and vision coverage, for certain retirees in the U.S., Canada and Europe. The defined benefit pension plans are primarily funded, but all OPEB plans are unfunded. We also offer defined contribution plans in each of our segments.

Accounting for our pension and OPEB plans requires that we make assumptions that involve considerable judgment which are significant inputs in the actuarial models that measure our net pension and OPEB obligations and ultimately impact our earnings. These include the discount rate, long-term expected rate of return on assets, and plan asset fair value determination, which are important assumptions used in determining the plans' funded status and annual net periodic pension and OPEB costs. Further assumptions include inflation considerations and health care cost trends. We evaluate these critical assumptions at least annually on a plan and country-specific basis. We also, with the help of actuaries, periodically evaluate other assumptions involving demographic factors, such as retirement age, mortality and turnover, and update them to reflect our experience and expectations for the future. While we believe that our assumptions are appropriate, significant differences in our actual experience or significant changes in our assumptions may materially affect our net pension and postretirement benefit obligations and related expense. The following discussion focuses on assumptions that are deemed to have the most material impact on our pension and OPEB liabilities and net periodic benefit cost.

Discount Rates

Discount rates are used to present value future benefit obligations based on each plan's respective estimated duration. Our pension and OPEB discount rates are based on our annual evaluation of high quality corporate bonds in various markets based on appropriate indices and actuarial guidance. We believe that our discount rate assumptions are appropriate; however, significant changes in our assumptions may materially affect our pension and OPEB obligations and related expense.

As of December 31, 2025, on a weighted-average basis, the discount rates used were 5.31% for our defined benefit pension plans and 4.95% for our OPEB plans. The change from the weighted-average discount rates of 5.41% for our defined benefit pension plans and 5.15% for our OPEB plans as of December 31, 2024, was primarily due to a decrease in corporate bond yields using December 31, 2025 market data for our U.S. plans.

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A 50 basis point change in our discount rate assumptions would have had the following effects on the benefit obligation balances as of December 31, 2025, for our pension and OPEB plans:

Decrease in discount rate

Increase in discount rate

(In millions)

Increase (decrease) impact to benefit obligation as of December 31, 2025

Pension obligation

OPEB obligation

Total impact to the benefit obligation

Our U.K. pension plan includes benefits linked to inflation. The above sensitivity analysis does not consider the implications to inflation resulting from the above contemplated discount rate changes. This sensitivity holds all other assumptions constant.

Long-Term Expected Rate of Return on Assets

The long-term expected return on assets is used to estimate the actual return that will occur on each individual funded plan's respective plan assets in the upcoming year. We determine each plan's EROA with substantial input from independent investment specialists, including our actuaries and our outsourced investment consultants. In developing each plan's EROA, we consider current and expected asset allocations, historical market rates as well as historical and expected returns on each plan's individual asset classes. In developing future return expectations for each of our plan's assets, we evaluate general market trends as well as key elements of asset class returns such as expected earnings growth, yields and spreads. The calculation includes inputs for interest, inflation, credit and risk premium (active investment management) rates and fees paid to service providers. Based on the above factors and expected asset allocations, we have assumed, on a weighted-average basis, an EROA of 6.05% for our defined benefit pension plan assets for cost recognition in 2026. This was an increase from the weighted-average rate of 5.70% we assumed for 2025, primarily due to updated investment guidelines and target asset allocations. We believe that our EROA assumptions are appropriate; however, significant changes in our assumptions or actual returns that differ significantly from estimated returns may materially affect our net periodic pension costs.

A 50 basis point change in our EROA assumptions made at the beginning of 2025 would have had the following effects on 2025 net periodic pension and postretirement benefit costs.

Decrease in EROA

Increase in EROA

(In millions)

Favorable (unfavorable) impact to the 2025 net periodic pension and postretirement benefit cost

Fair Value of Plan Assets

The fair value of plan assets is determined by us using available market information and appropriate valuation methodologies. However, considerable judgment is required in selecting an appropriate methodology and interpreting market data to develop the estimates of fair value, especially in the absence of quoted market values in an active market. Changes in these assumptions or the use of different market inputs may have a material impact on the estimated fair values or the ultimate amount at which the plan assets are available to satisfy our plan obligations.

Health Care Cost Trend Rates

The health care cost trend rates represent the rates at which health care costs are assumed to increase and are based on actuarial input and consideration of historical and expected experience. We use these trends as a significant assumption in determining our postretirement benefit obligation and related costs. Changes in our projections of future health care costs due to general economic conditions and those specific to health care will impact this trend rate. An increase in the trend rate would increase our obligation and expense of our postretirement health care plan. We believe that our health care cost trend rate assumptions are appropriate; however, significant changes in our assumptions may materially affect our postretirement benefit obligations and related costs. As of December 31, 2025, the health care trend rates used were ranging ratably from 7.50% in 2026 to 3.57% in 2040, which was an increase from our assumed health care trend rates ranging ratably from 7.00% in 2025 to 3.57% in 2040 as of December 31, 2024. See Part II—Item 8 Financial Statements and Supplementary Data, Note 11, "Employee Retirement Plans and Postretirement Benefits" for further information.

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Contingencies, Environmental and Litigation Reserves

Contingencies, environmental and litigation reserves are recorded when probable, using our best estimate of loss. These estimates involve significant judgment and are based on an evaluation of the range of loss related to such matters and where the amount and range can be reasonably estimated. These matters are generally resolved over a number of years and only when one or more future events occur or fail to occur. Following our initial determination, we regularly reassess and revise the potential liability related to any pending matters as new information becomes available. Unless capitalization is allowed or required by U.S. GAAP, environmental and legal costs are expensed when incurred. We disclose pending loss contingencies when the loss is deemed reasonably possible, which requires significant judgment. As a result of the inherent uncertainty of these matters, the ultimate conclusion and actual cost of settlement may materially differ from our estimates. We recognize contingent gains upon the determination that realization is assured beyond a reasonable doubt, regardless of the perceived probability of a favorable outcome prior to achieving that assurance. In the instance of gain contingencies resulting from favorable litigation, due to the numerous uncertainties inherent in a legal proceeding, gain contingencies resulting from legal settlements are not recognized in income until cash or other forms of payment are received. If significant and probable, we disclose as appropriate.

See Part II—Item 8 Financial Statements and Supplementary Data, Note 13, "Commitments and Contingencies" for a discussion of our contingencies, environmental and litigation reserves as of December 31, 2025.

Goodwill and Intangible Asset Valuation

We evaluate the carrying value of our goodwill and indefinite-lived intangible assets for impairment at least annually or when an interim triggering event occurs that may indicate potential impairment. Our annual impairment test of goodwill and indefinite-lived intangible assets is performed as of October 1, the first day of the last fiscal quarter. We evaluate our other definite-lived intangible assets for impairment when evidence exists that certain events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable. Significant judgments and assumptions are required in such impairment evaluations. As of December 31, 2025, the carrying values of goodwill and intangible assets were approximately $1.9 billion and $12.0 billion, respectively, with the goodwill balance entirely attributable to the Americas reporting unit.

We have the option of using a quantitative or qualitative approach for our annual impairment testing of goodwill and indefinite-lived intangible assets. When utilizing a quantitative impairment testing approach, we use a combination of discounted cash flow analyses and market approaches to determine the fair value of each of our reporting units and an excess earnings approach to determine the fair values of our indefinite-lived brand intangible assets. Our discounted cash flow projections include significant assumptions for growth rates for sales and associated costs of goods sold, which are based on various long-range financial and operational plans of each reporting unit or each indefinite-lived intangible asset, along with terminal growth rates. Additionally, discount rates used in our goodwill analysis are based on weighted-average cost of capital, driven by the prevailing interest rates in geographies where these businesses operate, as well as the credit ratings, financing abilities and opportunities of each reporting unit, among other factors. Discount rates for the indefinite-lived intangible analysis by brand largely reflect the rates supporting the overall reporting unit valuation but may differ to adjust for country or market specific risk associated with a particular brand, among other factors. Our market-based valuations utilize earnings multiples of comparable public companies, which are reflective of the market in which each respective reporting unit operates. The key assumptions used to derive the estimated fair values of our reporting units and indefinite-lived intangible assets represent Level 3 measurements.

Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and factors. As a result, there can be no assurance that the estimates and assumptions made for purposes of the annual goodwill and indefinite-lived intangible asset impairment tests will prove to be an accurate prediction of the future. Examples of events or circumstances that could reasonably be expected to negatively affect the underlying key assumptions and ultimately impact the estimated fair value of our reporting units and indefinite-lived intangible assets may include such items as: (i) a decrease in expected future cash flows, specifically, an inability to execute on our strategic initiatives, including prioritizing our investments to strengthen our core and value beer portfolios and to transform our above premium beer and beyond beer portfolios or an increase in costs driven by inflation or other factors that could significantly impact our immediate and long range results, prolonged weakness in consumer demand or other competitive pressures adversely affecting our long-term volume trends, changes in trends and consumer preferences within the industry towards other brands or product categories, unfavorable working capital changes or an inability to successfully implement our cost savings initiatives, (ii) adverse changes in macroeconomic conditions that significantly differ from our assumptions in timing and/or degree (such as a recession or evolving beer industry), (iii) significant unfavorable changes in tax rates, (iv) volatility in the equity and debt markets or other country-specific factors which could result in a higher weighted-average cost of capital, (v) sensitivity to market multiples; and (vi) regulation limiting or banning the manufacturing, distribution or sale of alcoholic beverages.

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If actual performance results differ significantly from our projections or we experience significant fluctuations in our other assumptions, a material impairment loss may occur in the future. See Part II—Item 8 Financial Statements and Supplementary Data, Note 6, "Goodwill and Intangible Assets" for further discussion and presentation of these amounts.

Goodwill

During the third quarter of 2025, as we began updating our long-range planning based on current year results to date and industry conditions, we identified a triggering event that indicated it was more likely than not that the carrying value of the Americas reporting unit exceeded its fair value. An impairment test was completed as of August 31, 2025, using a combination of a discounted cash flow analysis and market approach and it was concluded that the carrying value of the Americas reporting unit was in excess of its fair value such that a partial goodwill impairment loss of $3,645.7 million was recorded in the consolidated statements of operations. Due to the partial impairment charge, the Americas reporting unit is still considered to be at a heightened risk of future impairment. The triggering event was due to lower current year and future forecasted results which were driven by declines in the beer industry, market share losses and higher than expected costs in the U.S. combined with a higher discount rate and lower market multiples.

We utilized independent valuation specialists and industry accepted valuation models in calculating the fair value of the Americas reporting unit as of August 31, 2025. The key assumptions used to derive the estimated fair value of the Americas reporting unit, which included the internal cash flow projections based on our updated long-range plans and the discount rate, represented Level 3 measurements. Our discounted cash flow projections included assumptions for growth rates for sales and associated costs of goods sold, which were based on various long-range financial and operational plans, along with terminal growth rates. Additionally, the discount rate used in our analysis was based on the weighted-average cost of capital, driven by the prevailing interest rates and financing abilities as well as the identified risks and opportunities of the reporting unit. The increase in the discount rate compared to the prior year annual test was partially due to the additional risk premium assessed on the reporting unit based on the current industry environment.

Current projections used for the Americas reporting unit testing reflected our focus on building a portfolio of strong and scalable brands in both beer and beyond beer, which entails prioritizing our investments to strengthen our core and value beer portfolios and to transform our above premium beer and beyond beer portfolios. While progress has been made, continued focus is required to deliver on our objectives. Therefore, the growth targets included in management's forecasted future cash flows were inherently at risk given that the strategies are still in progress. Additionally, the fair value determinations are sensitive to changes in the beer industry environment, broader macroeconomic conditions, market multiples and discount rates that could negatively impact future analyses, including the impacts of cost inflation and tariffs, increases to interest rates and other external industry factors impacting our business.

Due to the proximity of the goodwill impairment test completed during the third quarter of 2025 to our annual testing date of October 1, 2025, we completed our required annual goodwill impairment testing using a qualitative approach and concluded that the fair value of the Americas reporting unit was more likely than not in excess of its carrying value and, therefore, no additional goodwill impairment charge was recorded. However, due to the partial impairment charge recognized in the third quarter of 2025, and the fact that the Americas reporting unit's fair value exceeds its carrying value by less than 15%, the Americas reporting unit continues to be at a heightened risk of future impairment.

Indefinite-Lived Intangible Assets

During the third quarter of 2025, as we began updating our long-range planning based on current year results to date and the current challenging industry environment in the relevant markets, we identified a triggering event for the Staropramen family of brands in the EMEA&APAC segment. The triggering event was driven by softer than expected current year and future forecasted results in certain of the key markets where the Staropramen family of brands is sold. We completed an impairment test using a discounted cash flow approach as of August 31, 2025 and concluded that the carrying value of the Staropramen family of brands was in excess of its fair value such that a partial impairment loss of $198.6 million was recorded within other operating income (expense), net in the consolidated statements of operations. After the impairment charge, the carrying value of the Staropramen family of brands was $257.1 million. The decline in the fair value of the Staropramen family of brands during the current year was impacted by reductions in management forecasts due to lower than expected brand results in 2025 driven by soft market demand and a heightened competitive landscape across key markets, resulting in a more modest growth trajectory than in previous assumptions. In conjunction with the impairment review of the Staropramen family of brands, we also reassessed the brand's indefinite-life classification and determined that the impaired brand has characteristics that have evolved and which now indicate a definite-life is more appropriate, including prolonged weakness in consumer demand driven by increased economic and competitive pressures. These factors have resulted in continued declines in performance and these pressures are expected to continue into the future. Therefore, we reclassified the Staropramen family of brands to a definite-lived intangible asset with a useful life of 50 years effective August 31, 2025.

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We utilized Level 3 fair value measurements in our impairment analysis of the Staropramen family of brands indefinite-lived intangible asset. We utilized independent valuation specialists in calculating the fair value of the Staropramen family of brands using the excess earnings approach. The future cash flows used in the analyses were based on internal cash flow projections related to our long-range plans and included significant assumptions for growth rates for sales and associated costs of goods sold. The discount rate utilized for the Staropramen family of brands was a key assumption and was based on the weighted-average cost of capital, driven by the prevailing interest rates and financing abilities of the geographies in which the family of brands are sold as well as the identified risks and opportunities of the brands for each geography.

The fair values of the Coors brands in the Americas (inclusive of our Coors brand in the U.S. and Coors distribution agreement in Canada), the Miller brands in the U.S. and the Carling brands in the U.K. are sufficiently in excess of their respective carrying values as of the October 1, 2025 annual testing date, with each having over 15% cushion of fair value over book value. We utilized Level 3 fair value measurements in our impairment analyses of our indefinite-lived intangible assets. An excess earnings approach is used to determine the fair values of these assets as of the testing date. The future cash flows used in the analyses are based on internal cash flow projections utilizing our long range plans and include significant assumptions by management. As of the October 1, 2025 annual testing date, a 50 basis point increase in our discount rate assumptions would not have resulted in an impairment of any of our indefinite-lived intangible assets.

Definite-Lived Intangible Assets and Other Long-Lived Assets

We continuously monitor the performance of our definite-lived intangible assets and other long-lived assets for potential triggering events suggesting an impairment review should be performed or useful lives should be re-assessed. During the third quarter of 2025, as we began updating our long-range planning based on current year results to date, we identified a triggering event for the Blue Run Spirits asset group in the Americas segment, due to softer current year and future forecasted results primarily driven by a challenging macroeconomic environment for full strength spirits, resulting in lower sales. The asset group did not pass the recoverability test and the carrying value was determined to exceed its fair value resulting in the full impairment of the definite-lived intangible brand of $75.3 million as of August 31, 2025, which was recorded within other operating income (expense), net in the consolidated statement of operations. The asset group was measured at fair value primarily using a discounted cash flow approach and utilized Level 3 fair value measurements.

Additionally, during 2024, due to a reduction in forecasted cash flows associated with one of our asset groups, we identified a triggering event and performed a recoverability test for the long-lived assets at the asset group level but concluded that the recoverability test passed and no impairment was recorded. No other material triggering events were identified in either 2025 or 2024 related to our definite-lived intangible assets or other long-lived assets.

Income Taxes

Income taxes are accounted for in accordance with U.S. GAAP. Judgment is required in determining our consolidated provision for income taxes. In the ordinary course of our global business, there are many transactions for which the ultimate tax outcome is uncertain. Additionally, our income tax provision is based on calculations and assumptions that are subject to examination by many different tax authorities.

We are periodically subject to income tax audits in various foreign and domestic jurisdictions, which can involve questions regarding our tax positions and result in additional income tax liabilities assessed against us. Settlement of any challenge resulting from these tax controversies can result in a variety of resolutions including no change, a complete disallowance, or some partial adjustment reached through negotiations or litigation. We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained based on its technical merits. We measure and record the tax benefits from such a position based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. Our estimated liabilities related to these matters are adjusted in the period in which the uncertain tax position is effectively settled, the statute of limitations for examination expires or when additional information becomes available. Our liability for unrecognized tax benefits requires the use of assumptions and significant judgment to estimate the exposures associated with our various filing positions. Although we believe that the judgments and estimates made are reasonable, actual results could differ and resulting adjustments could materially affect our effective tax rate and tax provision.

When cash is available after satisfying working capital needs and all other business obligations, we may distribute current earnings and the associated cash from a foreign subsidiary to its U.S. parent, and record the tax impact associated with the distribution. However, to the extent current earnings of our foreign operations exist and are not otherwise distributed or planned to be distributed, such earnings accumulate. These accumulated earnings are not considered permanently reinvested in our foreign operations. The taxes associated with any future repatriation of undistributed earnings are anticipated to be insignificant.

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We record a valuation allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized. We evaluate our ability to realize the tax benefits associated with deferred tax assets by assessing the adequacy of future expected taxable income, including the reversal of existing temporary differences, historical and projected operating results, and the availability of prudent and feasible tax planning strategies. The realization of tax benefits is evaluated by jurisdiction and the realizability of these assets can vary based on the character of the tax attribute and the carryforward periods specific to each jurisdiction.

There are proposed or pending tax law changes in various jurisdictions in which we do business. As discussed in Part II—Item 8 Financial Statements and Supplementary Data, Note 12, "Income Tax" , we recognize the impacts of changes in tax law upon enactment, and therefore, proposed changes in tax law, regulations and rules are not reflected within our tax provision. As a result, such changes may, upon ultimate enactment, result in material impacts to our financial statements.