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Year-over-year tone shift - average net-tone change across Risk Factors and MD&A vs the prior 10-K. This filing is -0.01pp more bearish than last year's.
Why YoY instead of absolute: the LM lexicon has ~6.6× more negative words than positive (legal/risk-disclosure language is heavy on hedging), so every 10-K reads bearish on raw tone. Year-over-year change strips that bias and surfaces the actual shift in management's framing.
Tone shift by section
The two components the gauge averages: how Risk Factors and MD&A each shifted in net tone versus last year's 10-K. The headline above is their average, so a green needle over a soft section just means the other section carried it.
Risk Factors
+0.05pp
Flat
Net-tone change vs last year's 10-K.
MD&A
-0.08pp
Flat
Net-tone change vs last year's 10-K.
Per-snippet highlights
Sentence-level sentiment highlighting with category and subcategory filters is coming once the snippet-scoring pipeline lands. For now, dig into the actual section text on the Sections tab.
Language change vs prior 10-K
Risk Factors (Item 1A) - words with the biggest YoY frequency increase
Negative rising
adversely+22
adverse+22
loss+9
against+9
unable+7
Positive rising
profitability+5
able+4
achieve+2
successfully+2
opportunities+2
Risk Factors (Item 1A)
11,641 words
ITEM 1A. RISK FACTORS
Among the factors that could have an impact on our ability to achieve operating results and meet our other goals are:
Risks Related to Business and Industry Conditions
Our business faces competition, which could affect our ability to maintain or raise prices, successfully enter certain markets or retain our market position.
Competition for our business includes not only generic suppliers of the same pesticidal active ingredients but also alternative proprietary pesticide chemistries and crop protection technologies that are bred into or applied onto seeds. Increased generic presence in agricultural chemical markets has been driven by the number of significant product patents and product data protections that have expired in the last decade, and this trend is expected to continue. There are also changing competitive dynamics in the agrochemical industry as some of our competitors have consolidated, resulting in them having greater scale and diversity, as well as market reach.
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Additionally, competition from generic agrochemical producers, particularly from producers based in China, has had and may continue to have a significant impact on our business and financial results, as a number of key product patents have expired in the last two decades. These competitive differences may not be overcome and may our business. Agriculture in many countries is changing and new technologies (e.g., precision pest prediction or application, data management) continue to emerge. At this time, the scope and potential impact of these technologies are largely unknown but could have the potential to our business.
Language change vs prior 10-K
MD&A (Item 7) - words with the biggest YoY frequency increase
Negative rising
impairment+17
loss+11
restructuring+7
challenges+2
shutdown+2
Positive rising
innovative+2
enhance+2
effective+1
able+1
gains+1
MD&A (Item 7)
16,839 words
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
FMC Corporation is a global agricultural sciences company dedicated to providing farmers innovative solutions that increase the productivity and resilience of their land. We operate in a single distinct business segment. We develop, market and sell all three major classes of crop protection chemicals (insecticides, herbicides and fungicides) as well as biologicals, crop nutrition, and seed treatment products, which we group as plant health. FMC’s innovative crop protection solutions help growers produce food, feed, fiber and fuel for an expanding world population while adapting to a changing environment. FMC is committed to discovering new insecticide, herbicide, and fungicide active ingredients, product formulations and pioneering technologies that are consistently better for the planet.
FORWARD-LOOKING INFORMATION
Statement under the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995: FMC and its representatives may from time to time make written or oral statements that are "forward-looking" and provide other than historical information, including statements contained herein, in FMC’s other filings with the SEC, and in reports or letters to FMC stockholders.
In some cases, FMC has identified forward-looking statements by such words or phrases as "will likely result," "is that," "expect," "expects," "should," "could," "may," "will continue to," "believe," "believes," "anticipates," "predicts," "forecasts," "estimates," "projects," "potential," "intends" or similar expressions identifying "forward-looking statements" within the meaning of the Private Securities Reform Act of 1995, including the of those words and phrases. Such forward-looking statements are based on management’s current views and assumptions regarding future events, future business conditions and the outlook for the company based on currently available information. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any results, levels of activity, performance or expressed or implied by any forward-looking statement. Additional factors include, among other things, the risk factors and other statements filed with the SEC included within this Form 10-K as well as other SEC filings and public communications. FMC readers not to place reliance on any such forward-looking statements, which speak only as of the date made. Forward-looking statements are qualified in their entirety by the above statement. FMC undertakes no obligation, and specifically any duty, to update or revise any forward-looking statements to reflect events or circumstances arising after the date of such statements or to reflect the occurrence of anticipated events, except as otherwise required by law.
Our markets are affected by climatic conditions, both chronic and acute, which could adversely impact our business.
Our business may be impacted by changing climate conditions, including physical risks from acute and chronic climate events and transition risks associated with longer‑term changes in markets and demand. The acute and chronic effects of climate conditions, including, but not limited to, drought, flooding, hurricanes, excessive heat and general volatility in seasonal temperatures, could adversely affect our operations globally. Drought and/or increased temperatures may change insect pest pressures, requiring growers to use more, less, or different insecticides. Longer-term shifts in temperature and precipitation patterns may also alter land suitability and crop mixes over time, changing pest and disease pressures and, in turn, demand for certain crop protection solutions. These shifts may become more rapid and persistent with rising temperatures and increasing GHG levels. Extreme weather events and natural disasters may result in, among other things, physical damage to our property and equipment, increased resource scarcity, including water, and interruptions to our supply chain. The nature of these events makes them difficult to predict and may result in significant costs or capital expenditures.
Unexpected market conditions may adversely impact our business due to the seasonal nature of the crop protection market and the geographic spread of our business.
In any given calendar quarter certain geographies may predominate the demand for our products in light of seasonal variations typically associated with the crop protection market and the geographic regions in which we operate. Unexpected market conditions in any such predominating geography, such as adverse weather, pest pressures, or other risks described herein, may impact our business if occurring during a calendar quarter in which such geography is predominating.
Changes in the regulatory environment, particularly in the U.S., Brazil, China, Argentina and the European Union, could adversely impact our ability to continue producing and/or selling certain products in our domestic and foreign markets or could increase the cost of producing and/or selling certain products.
We have continued to grow our geographic footprint particularly in Europe and Asia, which means that developments outside the U.S. will generally have a more significant effect on our operations than in the past. Our operations outside the U.S. are subject to special risks and restrictions, including: fluctuations in currency values; exchange control regulations; changes in local political or economic conditions; governmental pricing directives; import and trade restrictions or tariffs; import or export licensing requirements and trade policy; restrictions on the ability to repatriate funds; and other potentially detrimental domestic and foreign governmental practices or policies affecting U.S. companies doing business abroad.
We are sensitive to regulatory risk given the need to obtain and maintain pesticide registrations in every country in which we sell our products. Moreover, we are required to comply with protocols or applicable regulatory requirements of biological products. Protocols and regulations may change, or regulatory agencies may determine that a biological product is not approvable. There is a risk that future regulatory requirements may lead to delays in development of biologicals or limit growth from biologicals. Many countries require re-registration of pesticides to meet new and more challenging requirements; while we defend our products vigorously, these re-registration processes may result in significant additional data costs, reduced number of permitted product uses, or potential product cancellation. Compliance with changing laws and regulations may involve significant costs or capital expenditures or require changes in business practice that could result in reduced profitability. In the European Union, the regulatory risk specifically includes the chemicals regulation known as REACH (Registration, Evaluation, and Authorization of Chemicals), which requires manufacturers to verify through a special registration system that their chemicals can be marketed safely. Changes to the regulatory environment may be influenced by non-government public pressure as a result of negative perception regarding the use of our crop protection products. Products reviewed by regulators and labeled safe for use may still be challenged by others which could lead to negative public perception or regulatory action. Competing products labeled safe for use were subject to lawsuits or claims, and a similar situation for our products could result in negative impacts.
We do business in highly regulated industries. Changes in government regulations or trade association policies could adversely affect our results of operations.
Much of our business is subject to government regulation and regulation by certain private sector associations, compliance with which can impose significant costs on our business. Future government policies may adversely affect the supply of, demand for, and prices of the Company’s products; restrict the Company’s ability to do business in its existing and target markets;
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and adversely affect the Company’s revenues and operating results. Other regulations are applicable generally to all our businesses and corporate functions, including, without limitation, those promulgated under the FCPA, the Employee Retirement Income Security Act and other employment and health care related laws, federal and state securities laws, and the U.S. Patriot Act. Failure to comply with such regulations can result in additional costs, fines or criminal action.
A significant part of our operations is regulated by environmental laws and regulations, including those governing the labeling, use, storage, discharge and disposal of hazardous materials. Because we use and handle hazardous substances in our businesses, changes in environmental requirements or an unanticipated significant adverse environmental event could have an adverse effect on our business. We cannot assure that we have been, or will at all times be, in compliance with all environmental requirements, or that we will not incur costs or liabilities in connection with these requirements. Private parties, including current and former employees, could bring personal injury or other claimsagainst us due to the presence of, or exposure to, hazardous substances used, stored or disposed of by us, or contained in our products. We are also exposed to residual risk because some of the facilities and land which we have acquired may have environmental liabilities arising from their prior use. In addition, changes to environmental regulations may require us to modify our existing plant and processing facilities which could significantly increase the cost of those operations.
Our agricultural production and trade flows can be affected by government programs and legislation. Production levels, markets and prices of the commodities we merchandise can be affected by U.S. government programs, which include acreage controls and price support programs administered by the USDA and required levels of ethanol in gasoline through the Renewable Fuel Standards as administered by the EPA. Other examples of government policies that can have an impact on our business include the Inflation Reduction Act, tariffs, taxes, duties, subsidies, import and export restrictions, outright embargoes and price controls on agricultural commodities. Because a portion of our commodity sales are to exporters, the imposition of export restrictions and other foreign countries’ regulations could limit our sales opportunities and create additional credit risk associated with export brokers if shipments are rejected at their destination.
Our Company manufactures certain agricultural nutrients and uses potentially hazardous materials. All products containing pesticides, fungicides and herbicides must be registered with the EPA and state regulatory bodies before they can be sold. The inability to obtain or the cancellation of such registrations could have an adverse impact on our business. In the past, regulations governing the use and registration of these materials have required us to adjust the raw material content of our products and make formulation changes. Future regulatory changes may have similar consequences. Regulatory agencies, such as the EPA, may at any time reassess the safety of our products based on new scientific knowledge or other factors. If it were determined that any of our products were no longer considered to be safe, it could result in the amendment or withdrawal of existing approvals, which, in turn, could result in a loss of revenue, cause our inventory to become obsolete or give rise to potential lawsuits against us. Consequently, changes in existing and future government or trade association polices may restrict our ability to do business and have an adverse impact on the Company’s financial results.
Varying definitions in regulations create regulatory uncertainty for our Company when adapting to new environmental rules, including changes to EPA requirements.
Regulatory bodies may use different definitions for regulated substances, which may result in uncertainty for our Company when adapting to new environmental rules. For example, the EPA defines PFAS as chemicals with two or more fluorinated carbon atoms whereas OECD defines PFAS as containing at least one fluorinated carbon atom. Increased pressure from non-government organizations and public opinion influence policy and regulatory bodies, which may result in frequent changes in federal and state regulations causing disparate standards across jurisdictions. This regulatory uncertainty may cause restrictions or bans on certain products, coupled with increased litigation risks due to opaque compliance requirements, as well as difficulty in long-term planning and investment decisions, which adversely impact product development and reformulation. Furthermore, regulatory uncertainty may increase cash outflows for compliance and securitization of reserves. These effects of regulatory uncertainty could adversely impact our financial results.
We are subject to customer, consumer, shareholder and regulatory focus on sustainability, which may result in additional costs in order to meet new requirements, including adversely affecting our stock price, results of operations and access to capital.
We face increasing regulatory reporting requirements related to sustainability topics, specifically in the European Union among other jurisdictions. At the same time, our customers, consumers and shareholders may be sensitive to environmental-related and other long-term sustainability issues. The focus on sustainability has resulted and may continue to result in new and changing regulations, including the need to comply with different regulatory regimes in different jurisdictions, and customer requirements that could affect us. These could cause us to incur additional capital expenditure and other costs or to make changes to our operations or reporting systems in order to comply with any new regulations and customer requirements.
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We could also lose revenue, including as a result of negative publicity, if our customers divert business from us because we have not complied with their sustainability requirements. Increased regulatory scrutiny, consumer or customer legal actions, shareholder activism with respect to sustainability, shifting public and investor sentiment on sustainability matters could also lead to increased costs and disruption to operations. These potential costs, changes and loss of revenue could have a material adverse effect on our business, results of operations and financial condition. In addition, climate change may result in changes to the governmental policy around greenhouse gases and other environmental and sustainability‑related matters, including emission caps, trade regulations and other mechanisms to promote reduction of carbon emissions. Depending on their nature and scope, this could subject our manufacturing operations and suppliers to significant additional costs or limits on operations and affect the sources and supply of energy.
Our operating results could be significantly affected by the cost of commodities such as chemical raw material commodities, energy commodities, and harvested crop commodities.
Because most of our products are commodities, increases in commodity prices, including chemical raw material or energy commodity pricing, may negatively affect our financial results. There can be no assurance that we will be able to pass through increased costs to our customers. A significant increase in the price of fertilizer, natural gas, ammonia, sulfur or energy costs that is not recovered through an increase in the price of our related crop nutrients products could have a material adverse impact on our business. We use hedging strategies, where available on reasonable terms, to address energy and material commodity price risks. We may attempt to mitigate our exposure to increasing energy costs by hedging the cost of future deliveries of natural gas and electricity by entering into physical and financial derivative contracts. However, we are unable to avoid the risk of medium-term and long-term increases. Additionally, fluctuations in harvested crop commodity prices could negatively impact our customers' ability to sell their products at previously forecasted prices resulting in reduced customer liquidity. Inadequate customer liquidity could affect our customers’ abilities to pay for our products and, therefore, affect existing and future sales or our ability to collect on customer receivables.
Changes in the price or availability of key raw materials for production of finished goods have had, and could again have, a material adverse impact on our businesses.
Certain raw materials are critical to our production processes and our purchasing strategy and supply chain design are complex. Our supply chain and business operations could be disrupted from the temporary closure of third-party supplier and manufacturer facilities, interruptions in product supply or restrictions on the export or shipment of our products. We closely monitor raw material and supply chain costs. We source critical intermediates and finished products from a number of suppliers, largely outside of the U.S. and principally in China and India. From time to time, our profitability has been and may in the future be adversely impacted by the price and availability of these key inputs and other energy costs. In recent years, we have seen some logistics challenges, pointed supply chain shortages, and increased cost of goods due to disruptions in energy markets, inflation and tariffs. There is considerable uncertainty surrounding the trade relationship between the U.S. and trading partners — e.g., the tariffs on goods coming into the U.S. from China, the reciprocal tariffs on goods imported into the U.S. to match tariffs imposed by other nations on goods imported from the U.S., and China’s tariffs on imports of certain U.S. goods. Such changes have and may continue to adversely impact our business. In addition, the ongoing conflict between Russia and Ukraine and the related sanctions have led, and may continue to lead, to disruption and instability in global markets, supply chains and volatile pricing and availability of these key inputs and raw materials.
Further, while we have made supply arrangements to meet planned operating requirements, an inability to obtain the critical raw materials or operate under contract manufacturing arrangements would adversely impact our ability to produce certain products and could lead to operational disruption and increase uncertainties around business performance. An inability to obtain these products or execute under contract sourcing arrangements would adversely impact our ability to sell products.
Risks Related to our Business Operations
A global catastrophic event could have a material adverse effect on our business.
A global catastrophic event (e.g., nuclear incident, pandemic, natural disaster) could endanger the lives and safety of our employees, limit market access, constrain supply and would require high levels of cross-functional coordination to maintain business continuity. If not properly managed, FMC could suffer substantial financial losses should the event negatively impact our operations or those of our customers. Global catastrophic events could also result in social, economic, and labor instability in the countries in which we or our customers and suppliers operate. These uncertainties could have a material adverse effect on our business and our results of operation and financial condition. A widespread health crisis could adversely affect the global economy, resulting in an economic downturn that could impact demand for our products.
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As a chemical manufacturing company, our operations are subject to operational risks and have the potential to cause environmental or other damage as well as personal injury, or disrupt our ability to supply our customers, any of which could adversely affect our business, results of operations and cash flows.
The operation of a chemical manufacturing business as well as the sale and distribution of chemical products are subject to operational as well as safety, health and environmental risks. Our manufacturing processes and those of our contract manufacturers a re subject to hazards inherent in chemical manufacturing, which include explosions, fires, mechanical failure, unscheduleddowntimes, supplier disruptions, labor shortages or other labor difficulties, information technology systems outages, disruption in our supply chain or manufacturing and distribution operations, transportation interruptions, chemical spills, discharges or releases of toxic or hazardous substances or gases, shipment of contaminated or off-specification product to customers, storage tank leaks, other environmental risks, cyberattacks, or other sudden disruption in business operations beyond our control as a result of events such as acts of sabotage, terrorism or war, civil or political unrest, severe weather and natural disasters, large scale power outages and public health epidemics and pandemics. These events and their consequences could negatively impact our results of operations and cash flows, both during and after the period of operational difficulties, and could harm our reputat ion.
The production and/or processing of the insecticides, herbicides, and fungicides we develop, and the chemicals required, involve the handling, transportation, manufacture or use of certain substances or components that are inherently hazardous due to their toxic or volatile nature. While we take precautions to handle and transport these materials in a safe manner, if they are mishandled or released into the environment, they could cause property damage or result in personal injuryclaimsagainst us .
Interruptions at our key facilities may materially reduce the productivity of a particular manufacturing facility, or the profitability of our business as a whole.
We produce products through a combination of owned facilities and contract manufacturers. We own and operate large-scale active ingredient manufacturing facilities in the U.S. (Mobile), Puerto Rico (Manati), China (Jinshan), Denmark (Ronland), and India (Panoli). Our operating results are dependent in part on the continued operation of these production facilities. Interruptions at these facilities may materially reduce the productivity of a particular manufacturing facility, or the profitability of our business as a whole. Some of the hazards inherent in chemical manufacturing (e.g., spills, explosions, fires) may cause severedamage to or destruction of property and equipment or personal injury and loss of life and may result in suspension of operations or the shutdown of affected facilities. In addition, the occurrence of material operating problems at our facilities, particularly at a facility that is the sole source of a particular product we manufacture, or a disruption in our supply chain or distribution operations may result in loss of production, which, in turn, may make it difficult for us to meet customer needs. Other disruptions in supply chains and distribution channels, including those caused by global or regional logistics delays and constraints, such as rail or other transportation interruptions, could disrupt our business operations. These events and their consequences could negatively impact our results of operations and cash flows, both during and after the period of operational difficulties, and could harm our reputation.
A shortage or unavailability of trucks, railcars, tugs, barges and ships for carrying our products and the raw materials we use in our business could result in customer dissatisfaction, loss of production or sales and higher transportation or equipment costs.
We rely heavily upon truck, rail, tug, barge and ocean freight transportation to obtain raw materials needed at our facilities and to deliver our products to our customers. In addition, the cost of transportation is an important part of the final sale price of our products. Finding affordable and dependable transportation is important in obtaining our raw materials and to supply our customers. Higher costs for these transportation services or an interruption or slowdown due to factors including high demand, high fuel prices, labor disputes, layoffs or other factors affecting the availability of qualified transportation workers, adverse weather or other environmental events, or changes to rail, barge or ocean freight systems, could negatively affect our ability to produce our products or deliver them to our customers, which could affect our performance and results of operations.
Strong demand for grain and other products and a strong world economy increases the demand for and reduces the availability of transportation, both domestically and internationally. Shortages of railcars, barges and ocean transport for carrying product and increased transit time causing delays and missed shipments may result in customer dissatisfaction, loss of sales and higher equipment and transportation costs. In addition, during periods when the shipping industry has a shortage of ships, the substantial time needed to build new ships prevents rapid market response.
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We are subject to extensive federal, state, local, and foreign environmental and safety laws, regulations, directives, rules and ordinances concerning, among other things, emissions in the air, discharges to land and water, and the generation, handling, treatment, disposal and remediation of hazardous waste and other materials.
Governmental agencies may change requirements related to the production, use, emission, disposal or remediation of chemicals or products, including chemicals or products which we may have produced or used in our discontinued operations. We may face liability arising out of the normal course of business or now discontinued operations, including alleged personal injury or property damage due to exposure to chemicals or other hazardous substances at our current or former facilities or chemicals that we manufacture, handle or own. We take our environmental responsibilities very seriously, but there is a risk of environmental impact inherent in our manufacturing operations and transportation of chemicals. Any substantial liability for environmental damage could have a material adverse effect on our financial condition, results of operations and cash flows.
Risks related to Acquisitions and Divestitures
Our exploration of strategic options may not result in entering into or completing transactions, when necessary, and the process of reviewing alternative strategic options or their conclusion could adversely affect our stock price.
In February 2026, we announced that the Company is engaging in a strategic review to explore options to enhance shareholder value. Potential strategic paths may include partnerships, joint ventures, mergers, acquisitions, or licensing transactions, a combination of these, or other strategic transactions. There can be no assurance, however, that our review will result in transactions or other alternatives, even when deemed necessary. There is no set timetable for our strategic process, and we do not intend to provide updates unless or until the Board approves a specific action or otherwise determines that disclosure is appropriate or necessary. There can be no guarantee that the process of evaluating alternative strategic paths will result in our Company entering into or completing potential transactions within the anticipated timing or at all.
Any potential transaction would be dependent on a number of factors that may be beyond our control, including, among other things, market conditions, industry trends, the interest of third parties in a potential transaction with us, obtaining stockholder approval and the availability of financing to third parties in a potential transaction with us on reasonable terms. The process of reviewing alternative strategic paths may be time consuming, may involve the dedication of significant resources and may require us to incur significant costs and expenses. It could negatively impact our ability to attract, retain and motivate employees, and expose us to potential litigation in connection with this process or any resulting transaction. If we are unable to effectively manage the process, our financial condition and results of operations could be adversely affected. In addition, speculation regarding any developments related to the review of strategic alternatives and perceived uncertainties related to the future of our Company could cause our stock price to fluctuate significantly. Further, any strategic options that may be pursued and completed ultimately may not deliver the anticipated benefits or enhance stockholder value.
Our financial results could be harmed if we fail to implement the plan to divest the Company’s commercial business in India in the expected timeline.
In July 2025, the Board of Directors approved a plan to divest the Company’s commercial business in India in response to ongoing commercial challenges in the country. The sale process is underway and is expected to conclude in 2026. The assets related to this business are classified as held for sale beginning in the third quarter of 2025. However, we may be unable to find a buyer willing to purchase this business, or may not receive an offer on terms favorable to us. Further, if the sale process becomes protracted, we may have to hold onto the commercial business for longer than anticipated, which may have a continued adverse impact on our financial results. Failure to complete the divestment in the expected timeline and to successfully enter into a supply agreement with the eventual buyer to participate in the India market could have an adverse impact on the Company’s financial results.
The FMC Lithium separation might be interpreted as a taxable event by the IRS or local taxing authorities, subjecting the Company to material tax liabilities.
We received an opinion from outside counsel to the effect that the spin-off of FMC Lithium as a distribution to our stockholders, completed in March 2019, qualified as a non-taxable transaction for U.S. federal income tax purposes. The opinion is based on certain assumptions and representations as to factual matters from both FMC and FMC Lithium, as well as certain covenants by those parties. The opinion cannot be relied upon if any of the assumptions, representations or covenants are incorrect, incomplete, inaccurate or violated in any material respect. The opinion of counsel is not binding upon the IRS or the courts and there is no assurance that the IRS or a court will not take a contrary position. It is possible that the IRS or a state or local taxing authority could take the position that the aforementioned transaction results in the recognition of significant taxable gain by FMC, in which case FMC may be subject to material tax liabilities.
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Risks related to Portfolio Management
Any failure to realize benefits from acquisitions, alliances or joint ventures or to achieve our portfolio management objectives could adversely affect future financial results.
We continuously review our portfolio which includes the evaluation of potential business acquisitions that may strategically fit our business and strategic growth initiatives. If we are unable to successfully integrate and develop our acquired businesses, we could fail to achieve anticipated synergies including expected cost savings and revenue growth. Failure to achieve these anticipated synergies could materially and adversely affect our financial results. In addition to strategic acquisitions, we evaluate the diversity of our portfolio in light of our objectives and alignment with our growth strategy, which may result in divestiture of underperforming or non-strategic assets. In implementing this strategy, we may not be successful and the gains or losses on the divestiture of or lost operating income from such assets may affect the Company’s earnings and debt levels. Moreover, we may incur asset impairment charges related to acquisitions or divestitures that negatively impact earnings and our financial position.
If we are unable to innovate and successfully introduce new products or new technologies or processes reduce the demand for our products or the price at which we can sell products, our profitability could be adversely affected.
Our ability to compete successfully depends in part upon our ability to maintain a superior technological capability and to continue to identify, develop and commercialize new and innovative, high value-added products for existing and future customers. Our investment in the discovery and development of new pesticidal active ingredients relies on discovery of new chemical molecules, biological strains or formulations. Such discovery processes depend on our scientists being able to find new molecules, strains and formulations, which are novel and outside of patents held by others, and such molecules/strains/formulations being efficacious against target pests. Our process also depends on our ability to develop those molecules, strains and formulations into new products without creating an undue risk to human health and the environment as well as meeting applicable regulatory criteria. The timeline from active ingredient discovery through full development and product launch averages 8 to 10 years depending on local regulatory requirements; the complexity and duration of developing new products create risks that product concepts may fail during development or, when launched, may not meet then-current market needs or competitive conditions.
Our ability to compete effectively depends on our ability to protect our intellectual property rights.
Our innovation efforts are protected by patents, trade secrets and other intellectual property rights that cover many of our current products, manufacturing processes, and product uses, as well as many aspects of our research and development activities supporting our new product pipeline. Trademarks protect valuable brands associated with our products. Patents and trademarks are granted by individual jurisdictions and the duration of our patents depends on their respective jurisdictions and payment of annuities. Our future performance will depend on our ability to address expiration of active ingredient composition of matter patents. We are focused on effective enforcement of our patents that continue to cover key chemical intermediates and process patents, as well as portfolio life cycle management, particularly for our high value diamide insecticides for which our composition of matter patents on the active ingredient itself have expired in most countries and our process manufacturing and chemical intermediate patents only a limited remaining duration. See "Patents, Trademarks and Licenses" in Item 1 for more details. Patent and trademark enforcement is subject to the risks inherent in litigation, and our product portfolio life cycle management efforts may not be effective in maintaining our market position or the profitability of our products. If our innovation efforts fail to result in process improvements to reduce costs, such conditions could impede our competitive position. Some of our competitors may secure patents on production methods or uses of products that may limit our ability to compete cost-effectively.
The composition of matter patents on our Rynaxypyr ® active and Cyazypyr ® active ingredients have expired in all major markets, which will affect our ability to compete effectively.
In addition to the now-expired composition of matter patents for these diamide active ingredients, we also have patents regarding the production of these diamide active ingredients and chemical intermediates involved in such production, which expired in many major markets in December 2025. We compete with generic suppliers of the same pesticidal active ingredients and our competitive risks have increased and are expected to continue to as a result of the expired patents. For these diamide products, we also hold patents on certain formulations (including mixtures), trademark and data exclusivity protection in certain countries which have longer duration. For other products in our commercial and development portfolios, we have a broad estate of intellectual property including patents, trademark and data protection. We intend to strategically and vigorously enforce our patents and other forms of intellectual property againstsuspected infringers and have done so already against several third parties. However, third parties may seek to enter markets with infringing products or may find alternative production methods that avoid infringement.
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We may not be successful in litigating to enforce our patents due to the risks inherent in any litigation. Patents involve complex factual and legal issues and, thus, the scope, validity or enforceability of any patent claims we have or may obtain cannot be clearly predicted. Patents may be challenged in the courts, as well as in various administrative proceedings before U.S. or foreign patent offices, and may be deemed unenforceable, invalidated or circumvented. We are currently and may in the future be a party to various lawsuits or administrative proceedings involving our patents. See "Patents, Trademarks and Licenses" in Item 1 for more details. Such challenges can result in some or all of the claims of the asserted patent being invalidated or deemed unenforceable. In such circumstances, an adverse patent enforcement decision could lead to the entry of competing products in relevant markets and may result in a material adverse impact our financial results.
Risks related to our Results of Operations
Our significant non-US operations expose us to global exchange rate fluctuations that could adversely impact our profitability.
We conduct a significant portion of our operations outside the U.S. Consequently, fluctuations in currencies of other countries, especially the Indian rupee, Brazilian real, Euro, Chinese yuan, Mexican peso, Australian dollar and Canadian dollar may materially affect our operating results. Because our consolidated financial statements are presented in U.S. dollars, we must translate revenues, income and expenses, as well as assets and liabilities, into U.S. dollars based on average exchange rates prevailing during the reporting period or the exchange rate at the end of that period. Therefore, increases or decreases in the value of the U.S. dollar against other major currencies will affect our net operating revenues, operating income and the cost of balance sheet items denominated in foreign currencies. Foreign exchange rates can also impact the competitiveness of products produced in certain jurisdictions and exported for sale into other jurisdictions. These changes may impact the value received for the sale of our goods versus those of our competitors.
In addition to currency translation risks, we incur a currency transaction risk whenever one of our operating subsidiaries enters into a purchase or sales transaction using a currency different from the operating subsidiary’s functional currency. Given the volatility of exchange rates, particularly the strengthening of the U.S. dollar against major currencies or the currencies of large developing countries, we may not be able to manage our currency transaction and translation risks effectively.
We use financial instruments to hedge certain exposure to foreign currency fluctuations, but those hedges in most cases cover existing balance sheet exposures and not future transactional exposures. We cannot guarantee that our hedging strategies will be effective. In addition, the use of financial instruments creates counterparty settlement risk. Failure to effectively manage these risks could have an adverse impact on our financial position, results of operations and cash flows.
We could be subject to changes in our tax rates and the adoption of tax legislation or exposure to additional tax liabilities that may adversely affect our results of operations, financial condition, and cash flows.
We are subject to taxes in the U.S. and non-U.S. jurisdictions where our subsidiaries are organized. Due to economic and political conditions, tax rates in various jurisdictions may be subject to significant change. Our future effective tax rates could be affected by and may fluctuate because of, among other things, changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, changes in tax laws or their interpretations, and taxes associated with the repatriation of our non-U.S. earnings. Our tax returns and other tax matters are subject to examination by local tax authorities and governmental bodies. Additionally, we and our subsidiaries are engaged in intercompany transactions across multiple tax jurisdictions. Although we believe we have clearly reflected the economics of these transactions with proper local transfer pricing documentation in place, tax authorities could propose and sustain adjustments. We regularly assess the likelihood of an adverse outcome resulting from these examinations to determine the adequacy of our provision for taxes. There can be no assurance as to the outcome of these examinations. If our effective tax rates were to increase, or if the ultimate determination of the taxes owed by us is for an amount in excess of amounts previously accrued, our operating results, financial condition, and cash flows could be adversely affected. We, and our subsidiaries, are required to file certain tax returns and information reports with various tax authorities and government bodies. The failure to file returns or information reports could be punishable by civil penalties as well as other remedial measures which could adversely affect our operating results, financial condition, or cash flows. Additionally, further administrative guidance or other changes to the Global Anti-Base Erosion (GLOBE) rules that cause changes in tax legislation issued by the Organization for Economic Cooperation and Development (“OECD”) could potentially impact certain tax benefits previously received. There is no guarantee that administrative guidance or rules will remain unchanged or that the US government will adopt the global tax rules in accordance with the OECD approach, either of which could impact the value of the incentives granted to us and which could potentially lead to significant future international tax disputes.
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We may incur significant non-cash charges if our long-lived assets become impaired in the future.
Under accounting principles generally accepted in the U.S. (“GAAP”), we review long-lived assets, including property, plant and equipment, if events or circumstances indicate that their carrying value may not be recoverable. The process of impairment testing involves a number of judgments and estimates made by management, including the fair values of assets and liabilities, future cash flows, our interpretation of current economic indicators and market conditions, overall economic conditions and our strategic operational plans with regard to our portfolio. If the judgments and estimates used in our analysis are not realized or change due to external factors, then actual results may not be consistent with these judgments and estimates, and our long-lived assets may become impaired in future periods. If our long-lived assets are determined to be impaired in the future, we may be required to record non-cash charges to earnings during the period in which the impairment is determined, which could be significant and have an adverse effect on our financial condition and results of operations. We have, in the past, and may in the future, be required to write down the value of our long-lived assets, and such future write downs could be material.
Significant changes in pension fund investment performance or assumptions relating to pension costs may have a material effect on the valuation of pension obligations, the funded status of pension plans and our pension cost.
Our U.S. Qualified Plan has been fully funded for the last several years and as such, the primary investment strategy is a liability hedging approach with an objective of maintaining the funded status of the plan such that the funded status volatility is minimized and the likelihood that we will be required to make significant contributions to the plan is limited. The portfolio is comprised of 100 percent fixed income securities and cash. Our plan assets and obligation under our U.S. Qualified Plan are both in excess of $900 million. Additionally, obligations related to our pension and postretirement plans reflect certain assumptions. To the extent actual experience differs from these assumptions, our costs and funding obligations could increase or decrease significantly. While we provide other defined benefit, defined contribution and postretirement benefits to our employees and retirees, our risk is focused on our U.S. Qualified Plan given its size and impact on our consolidated financial position.
We may be subject to litigation, which may result in substantial costs and a diversion of management's attention and resources, which could harm our business.
We are involved from time to time in legal and regulatory proceedings, which may be material in the future. The outcome of proceedings, lawsuits and claims may differ from our expectations, leading us to change estimates of liabilities and related insurance receivables. Legal and regulatory proceedings, whether with or without merit, and associated internal investigations, may be time-consuming and expensive to prosecute, defend or conduct, may divert management’s attention and other resources, inhibit our ability to sell our products, result in adverse judgments for damages, injunctive relief, penalties and fines, and otherwise negatively affect our business. See Note 1 “ Principal Accounting Policies and Related Financial Information ,” Note 10 “ Environmental Obligations ” and Note 19 “ Guarantees, Commitments and Contingencies ” in the notes to our consolidated financial statements included in this Form 10-K for a description of our material pending legal proceedings.
Our operations and the production and handling of our products involve significant risks and hazards. We are not fully insured against all potential hazards and risks incident to our business and as a result, may not be able to adequately cover our losses.
We maintain property, business interruption, casualty and liability insurance policies, but we are not fully insured against all potential hazards and risks incident to our business, and certain hazards and risks associated with our operations may not be insurable. Some of these hazards can cause bodily injury and loss of life, severedamage to or destruction of property and equipment and environmental damage and may result in suspension of operations for an extended period of time and/or the imposition of civil or criminalpenalties and liabilities. If we were to incur significant liability for which we were not fully insured, it could have a material adverse effect on our business, financial condition, results of operations and cash flows. We are subject to various self-insured retentions, deductibles and limits under these insurance policies. The policies also contain exclusions and conditions that could have a material adverse impact on our ability to receive indemnification thereunder. Our policies are generally renewed annually. As a result of market conditions, our premiums, self-insured retentions and deductibles for certain insurance policies can increase substantially and, in some instances, certain insurance may become unavailable or available only for reduced amounts of coverage. In addition, significantly increased costs could lead us to decide to reduce, or possibly eliminate, coverage. We may be unable to buy and maintain insurance with adequate limits and reasonable pricing terms and conditions.
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Risks Related to the Ownership of Our Common Stock
Our stock price has experienced significant volatility and may continue to fluctuate substantially.
The trading price of our common stock has been highly volatile and could continue to be subject to wide fluctuations in response to various factors, some of which are beyond our control. During 2025, our stock price declined by more than 70% from its 52-week high and, at times, fell over 35% in a single week following earnings announcements and revised revenue guidance. These sharp movements were driven by factors such as competing production of generic products, lower-than-expected demand for crop protection products, inventory normalization across the agricultural supply chain, and broader market conditions. The stock market, and the market for agricultural chemical companies in particular, has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of those companies. In addition, a large proportion of our common stock has been historically and may in the future be traded by short sellers, which may put pressure on the supply and demand for our common stock, further influencing volatility in its market price. Public perception of our company or management and other factors outside of our control may additionally impact the stock price regardless of actual operating performance. In the past, following periods of volatility in the overall market or the market price of our shares, securities class action litigation has been filed against us. While we defend such actions vigorously, any judgment against us or any future stockholder litigation could result in substantial costs and a diversion of management’s attention and resources. Any adverse determination in litigation could also subject us to significant liabilities.
We may fail to meet our publicly announced guidance or other expectations about our business, which could cause our stock price to decline.
From time to time, we provide guidance regarding our expected financial and business performance. Predicting future conditions is inherently uncertain, and our guidance may ultimately prove inaccurate. Our projections depend on assumptions regarding various factors, such as crop protection demand, customer inventory management, competitive pressures from generics, foreign currency exchange rates, commodity and raw material costs, and the timing of product launches or patent expirations. These factors can change rapidly and may not follow a predictable pattern. If our actual results differ materially from our guidance, including as a result of our assumptions not being met or the occurrence of various risks and uncertainties that could impact our financial performance, the market value of our common stock could decline significantly. We have in the past needed to, and may in the future need to, revise guidance downward after weaker-than-expected volumes and pricing. Moreover, our financial results may not meet expectations of equity research analysts, rating agencies, or investors, who may focus on short-term quarterly results. Failure to meet guidance or market expectations could cause the trading price of our stock to decline substantially, either suddenly or over time.
Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult, may diminish the value of our common stock, and may prevent attempts by our stockholders to replace or remove our current management.
We are incorporated in Delaware. Certain anti-takeover provisions under Delaware law and in our certificate of incorporation and restated by-laws, as currently in effect, may make a change of control of our company more difficult, even if a change in control would be beneficial to our stockholders. Our anti-takeover provisions include provisions such as a prohibition on stockholder actions by written consent, the authority of our board of directors to issue preferred stock without stockholder approval, advance notice requirements for stockholder proposals and nominations, and supermajority voting requirements for specified actions. These provisions may delay or prevent an acquisition of us, even if the acquisition may be considered beneficial by some of our stockholders, and could limit the opportunity for our stockholders to receive a premium for their shares of our common stock. Even in the absence of a takeover attempt, the existence of these provisions may adversely affect the prevailing market price of our common stock if they are viewed as discouraging future takeover attempts. In addition, they may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our board of directors, which is responsible for appointing the members of our management.
Future cash dividends are subject to final determination by our Board of Directors and are not guaranteed.
Future cash dividends depend on a variety of factors, including earnings, capital requirements, financial condition, general economic conditions and other factors considered relevant by us. Dividends are subject to final determination by our Board of Directors and the Board, in its discretion, may decide at any time to change our historical dividend practices. Beginning with the dividends paid in January 2026, the Board of Directors significantly reduced the quarterly dividend per share. O ur shareholders are not guaranteed, and do not have contractual rights, to receive dividends until declared. Our ability to pay or increase dividends will depend on our operating results and may be restricted by, among other things, covenants in our existing or certain financing agreements we may enter into.
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General Risk Factors :
Our results may be affected by changes in distribution channels, which could impact our ability to access the market.
Consolidation of the value chain may limit FMC’s access in certain markets. Acquisition of retailers and wholesalers, particularly by competitors, could restrict FMC’s distribution footprint. Failure to adapt to similar trends in business to business and business to consumer could place FMC at a competitive disadvantage.
We may incur material costs and liabilities in complying with government regulations.
We are subject to the rules and regulations of various governmental agencies, including in the United States, Brazil, China, India, the European Union, Mexico and Argentina and the other countries in which the Company operates. These include rules and regulations administered by governmental agencies at the supranational, federal, state, provincial or local level.
The applicable rules, regulations and guidance promulgated by these and other agencies, which are likely to change over time, affect our operations and may influence our operating results at one or more facilities. Furthermore, the loss of or failure to obtain necessary federal, state, provincial or local permits and registrations at one or more of our facilities could halt or curtail operations at impacted facilities, which could result in impairment charges related to the affected facility and otherwise adversely affect our operating results. In addition, our failure to comply with applicable rules, regulations and guidance, including obtaining or maintaining required operating certificates or permits, could subject us to: (i) administrative penalties and injunctive relief; (ii) civil remedies, including fines, injunctions and product recalls; and/or (iii) adverse publicity. There can be no assurance that we will not incur material costs and liabilities in connection with these rules, regulations and guidance.
Given the competitive nature of our industry, we could be adversely affected by violations of various countries’ antitrust, competition and consumer protection laws. These laws generally prohibit companies and individuals from engaging in anticompetitive and unfair business practices. While our policies mandate compliance with these laws, we cannot provide assurance that our internal control policies and procedures will always protect us from violations or reckless or criminal acts committed by our employees, joint venture partners or agents.
We could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar anti-bribery laws of other countries, as well as trade sanctions administered by the office of Foreign Assets Control and the Department of Commerce.
The U.S. Foreign Corrupt Practices Act (“FCPA”) and similar anti-bribery laws of other countries generally prohibit companies and their intermediaries from making or receiving improper payments to governmental officials or others for the purpose of obtaining or retaining business or for other unfairadvantage. Our policies mandate compliance with anti-bribery laws. We operate in many parts of the world that have experienced corruption to some degree and, in certain circumstances, strict compliance with anti-bribery laws may conflict with local customs and practices. We are also required to comply with U.S. regulations on trade sanctions and embargoes administered by the U.S. Department of the Treasury, Office of Foreign Assets Control (“OFAC”), as well as export control regulations administered by the Commerce Department and similar multi-national bodies and governmental agencies worldwide, which are complex and often changing. A violation thereof could subject us to regulatory enforcement actions, including a loss of export privileges and significant civil and criminalpenalties and fines.
In addition, we may enter into joint ventures with joint venture partners who are domiciled in areas of the world with anti-bribery laws, regulations and business practices that differ from those in the United States. There is risk that our joint venture partners will violate the FCPA and other anti-bribery laws and regulations, as well as OFAC sanctions.
Although we have internal controls and procedures designed to ensure compliance with these laws, there can be no assurance that our controls and procedures will prevent a violation of these laws. Violations of these laws, or allegations of such violations, could disrupt our business and result in a material adverse effect on our results of operations, financial condition, and cash flows.
Our success depends upon our ability to identify, attract, retain and develop key personnel and the succession of senior management.
Our success largely depends on the performance of our management team and other key associates. If our compensation and benefits, talent management, or cultural programs and practices are not competitive, or employees otherwise become more difficult to attract or retain under reasonable terms, we may experience higher labor-related costs and may be unable to attract, retain, develop and progress a qualified workforce, which could adversely affect our business and future success and impair our ability to meet our strategic objectives and the needs of our customers. We operate in markets where business ethics and local customs may differ from our company standards, increasing the risk of impropriety and regulatory enforcement. Significant effort is required to ensure that the right mix of resources are trained, engaged and focused on achieving business objectives while adhering to our core values of safety, ethics and compliance.
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In addition, if we are unable to effectively provide for the succession of senior management, including our Chief Executive Officer, our business, results of operations, cash flows and financial condition may be adversely affected. While we maintain an ongoing succession planning process and have succession plans in place for senior management and other key associates, these do not guarantee that the services of qualified senior executives will continue to be available to us at particular moments in time.
Our business has been and could continue to be adversely affected by economic and political changes in the markets where we compete.
The following have and could continue to adversely affect our business: trade restrictions, tariff increases or potential new tariffs, foreign ownership restrictions and economic embargoes imposed by the U.S. or any of the foreign countries in which we do business; changes in laws, taxation, and regulations and the interpretation and application of these laws, taxes, and regulations; restrictions imposed by the U.S. government or foreign governments through exchange controls or taxation policy; nationalization or expropriation of property, undeveloped property rights, and legal systems or political instability; other governmental actions; inflation rates and inflationary pressures leading to higher input costs, recessions; and other external factors over which we have no control. While inflationary pressures have recently eased, a resurgence of these conditions may negatively impact our revenue, gross and operating margins, and net income. Economic and political conditions within the U.S. and foreign jurisdictions or strained relations between countries could result in fluctuations in demand, price volatility, loss of property, state sponsored cyberattacks, supply disruptions, or other disruptions. An open conflict or war across any region significant to our business could result in plant closures, employee displacement, and an inability to obtain key supplies and materials. Current U.S. tariff policies may increase the costs of goods being imported into the U.S., and other nations may impose new or different tariffs or other trade sanctions that increase the cost of our importing into those other nations, which we may not be able to mitigate or avoid, leading to increased costs of materials and/or other trade disruptions. The current military conflict between Russia and Ukraine could disrupt or otherwise adversely impact our operations in Ukraine; and related sanctions, export controls or other actions that may be initiated by nations including the U.S., the European Union or Russia (e.g., potential cyberattacks, disruption of energy flows, etc.) could adversely affect our business and/or our supply chain, business partners or customers in other countries beyond Ukraine. In Argentina, continued inflation and foreign exchange controls could adversely affect our business. Losses may be incurred as a result of various government actions in the country such as the devaluation of the Argentine peso, changes in tax policies, and changes in capital controls/policies. Realignment of change in regional economic arrangements could have an operational impact on our businesses. Our enforcement of intellectual property rights in jurisdictions outside of the United States may be impacted by geopolitical tensions between the United States and those other countries. In China, unpredictable enforcement of environmental regulations could result in unanticipatedshutdowns in broad geographic areas, impacting our contract manufacturers and raw material suppliers.
Our business is subject to risks associated with sourcing and manufacturing outside of the U.S. and risks from tariffs and/or international trade wars.
We import many of our raw materials and finished goods from countries outside of the United States, including but not limited to China. Our import operations are subject to complex customs laws, regulations, tax requirements, forced labor laws and trade regulations, such as tariffs set by governments, either through mutual agreements or bilateral actions. Tariffs on goods imported into the U.S., particularly goods from China and India, have increased the cost of the goods we purchase. Additional tariffs and protectionist duties could be imposed by the U.S. with relatively short notice to us. These governmental actions could have, and any similar future actions may have, a material adverse effect on our business, financial condition and results of operations. The overall effect of these risks is that our costs may increase or we may experience supply disruptions, which in turn may result in lower profitability if we are unable to offset such increases through higher prices, and/or that we may suffer a decline in sales if our customers do not accept price increases.
Our information technology systems and system s operated by our vendors and third parties could be penetrated by outside parties’ intent on observing or gathering information, extracting information, corrupting information, deploying ransomware, or disrupting business processes.
Remote and other work arrangements may leave the Company more vulnerable to a cyberattack. Our systems and those of our vendors and third parties have in the past been, and will likely be in the future, subject to unauthorized access attempts. Implementing system updates or security patches in an untimely manner could leave our company exposed to security breaches. Unauthorized access to our networks or systems could disrupt our business operations and potentially result in failures or interruptions in our information systems, lockouts due to ransomware, or in the loss of assets and could have a material adverse effect on our business, financial condition or results of operations. We engage in response planning, simulations, trainings, tabletop exercises, and other efforts to mitigate risks associated with cybersecurity.
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Breaches of our security measures or the accidentalloss, inadvertent disclosure, or unapproved dissemination of proprietary, sensitive, confidential or personal information about the Company, our employees, our vendors, or our customers, could result in litigation, violations of applicable data privacy regulations, and liability for the Company. We have not experienced a significant or material impact from these events to date and we may need to expend significant resources to maintain or continue to mature our protective and preventative measures to stay abreast of the ever-changing cybersecurity threat landscape. We maintain a multifaceted cybersecurity program designed to identify, protect, detect, respond, and recover from a cybersecurity event. We ensure that the program is aligned with the National Institute of Standards and Technology ("NIST") Cybersecurity Framework. While we have taken measures to assess the requirements of, and to comply with the rapidly growing cybersecurity and data privacy regulations in multiple jurisdictions, these measures may be challenged by authorities that regulate cybersecurity and privacy-related compliance. We could incur significant expense in facilitating and responding to investigations and if the measures we have taken prove to be inadequate, we could face fines or penalties. This could damage our reputation, or otherwise harm our business, financial condition, or results of operations.
We have been and will continue to be subject to advanced and persistentthreats in the areas of information and operational technology security and fraud. We rely on information and operational technology systems, including tools that utilize artificial intelligence, to conduct our business. We seek to prevent unauthorized access, maintain the confidentiality and the integrity of our information and operational technology systems and strive to detect and investigate any cybersecurity incidents that may occur, however, despite these efforts and our operation of a cybersecurity program aligned with the NIST Cybersecurity Framework, we may, in some, cases, still be unaware of a particular incident or its magnitude and effects. We may face increased information technology security, continuity and fraud risks due in part to our business efforts to digitize certain operations at our manufacturing sites to increase efficiencies and to our continued reliance on many employees working remotely part of the time, which may create additional information security vulnerabilities and/or magnify the impact of any disruption in information technology systems.
To the extent that any security breach impacts operations at our manufacturing sites, we may experience production or shipping disruptions. To the extent that any security breach results in inappropriate disclosure of our employees’, customers’ or vendors’ confidential or personally identifiable information, we may incur liability or suffer reputational damage in the marketplace as a result. We maintain cyber/information security insurance, but any losses may be beyond the limits, or outside the coverage, of our policy.
Information and operational security threats and methods of perpetratingfraud or misappropriating information are constantly evolving and becoming more complex, which increases the difficulty and expense of defendingagainst these threats. In addition, the devotion of additional resources to the security of our information or operational technology systems in the future could significantly increase the cost of doing business or otherwise adversely impact our financial results.
We operate on a single global instance of SAP, which makes our Company vulnerable to system and hardware changes .
Unmanaged or poorly managed system and hardware changes across the enterprise may disrupt operations, introduce vulnerabilities, and result in increased maintenance.
Artificial intelligence could subject the Company to loss through various internal and external risks.
The pace of artificial intelligence advancements, including generative artificial intelligence, and its complex and dynamic regulatory environment subjects the Company to a variety of risks. This includes risks to the privacy and security of the Company’s data, such as unauthorized disclosures of data which could be used to the detriment of the Company. Artificial intelligence also introduces tools that could be used for malicious purposes, such as advanced deceitful communication methods used to harm the Company. Artificial intelligence also subjects the Company to potential competitive disadvantages in its business and missedinnovationopportunities. In addition, improper or unauthorized use of artificial intelligence tools, or inadequate governance over such tools, could increase the risk of data leakage, inaccurate outputs, regulatory non-compliance, or other adverse impacts.
Disruptions in the global credit, financial and/or currency markets could limit our access to credit or otherwise harm our financial results, which could have a material adverse impact on our business.
We rely on cash generated from operations and external financing to fund our growth and working capital needs. Limitations on access to external financing could adversely affect our operating results. Moreover, interest payments, dividends and the expansion of our business or other business opportunities may require significant amounts of capital. We believe that our cash from operations and available borrowings under the Fifth Amended and Restated Credit Agreement, dated as of June 17, 2022 (the "Revolving Credit Facility"), will be sufficient to meet these needs in the foreseeable future. However, if we need external financing, our access to credit markets and pricing of our capital will be dependent upon maintaining sufficient credit ratings from credit rating agencies and the state of the capital markets generally.
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There can be no assurances that we would be able to obtain equity or debt financing on terms we deem acceptable, and it is possible that the cost of any financings could increase, thereby increasing our expenses and decreasing our net income. If we are unable to generate sufficient cash flow or raise adequate external financing, including as a result of disruptions in the global credit markets, we could be forced to restrict our operations and growth opportunities, which could adversely affect our operating results.
Our current indebtedness could have a negative impact on our liquidity or restrict our activities.
We plan to meet our liquidity needs through available cash, cash generated from operations and borrowings under our committed Revolving Credit Facility as well as other liquidity facilities, and in certain instances access to debt capital markets. If we are not able to maintain compliance with the covenants under our debt agreements, and in the event of a default in our Revolving Credit Facility or any of our senior notes, we could be required to immediately repay all outstanding borrowings and make cash deposits as collateral for all obligations the facility supports, which we may not be able to do. Our current level of indebtedness could result in a higher portion of cash flow from operations being dedicated to the payment of principal and interest on our debt, which may reduce cash flows available to fund our operations, capital expenditures, and other business opportunities. Our indebtedness could also hinder our ability to pursue strategic transactions that we would otherwise consider to be in the best interests of stockholders.
Our ability to meet certain restrictive covenants and guarantees in our debt instruments will be subject to economic conditions and to financial, market, and competitive factors, many of which are beyond our control. If our business does not perform in line with current expectations, we will be at risk of non-compliance with such covenants and guarantees. A breach of any of these covenants could result in a default. Any default under any of our credit arrangements could cause a default under many of our other credit agreements and debt instruments. Without waivers from lenders party to those agreements, any such default could have a material adverse effect on our ability to continue to operate. In 2025, we entered into several amendments to our Revolving Credit Facility to adjust certain financial covenants in the agreement to provide additional financial flexibility given current market challenges. While we have been able to secure amendments or waivers with respect to our existing credit agreements, there is no assurance that our lenders would provide waivers for or agree to amendments in the future should we encounter difficulties in complying with our financial covenants.
Recent credit rating downgrades and potential future downgrades could increase our financing costs and limit access to capital.
The major rating agencies routinely evaluate our credit profile and assign credit ratings to us. In recent months, our long-term credit ratings were downgraded below investment grade by the major rating agencies, primarily due to increased leverage, generics competitive pressures, and weaker earnings performance. These downgrades have already increased our cost of borrowing and may limit the availability of certain financing sources. If we need to raise additional capital in the future, for example, to maintain adequate liquidity, refinance maturing obligations, or fund strategic initiatives, our non-investment-grade status could result in higher financing costs and more restrictive terms. Further downgrades could exacerbate these challenges. In addition, our ability to retire or refinance debt to levels acceptable to rating agencies in a timely manner may affect our future credit profile and financial flexibility.
The Company entered into Amendment No. 5 to our Revolving Credit Facility in December 2025, which includes certain restrictive covenants and guarantees . Among these restrictions, the amendment provides that the Company will grant a lien over substantially all of its assets, subject to customary exceptions, upon the occurrence of the Company receiving a public debt rating from any two of S&P, Fitch or Moody’s that is below “BB+” (in the case of S&P and Fitch) or below “Ba1” (in the case of Moody’s), as applicable. A trigger of such a provision could adversely affect our cash flows, results of operations and financial condition.
Deterioration in the global economy and worldwide credit and foreign exchange markets could adversely affect our business.
A worsening of global or regional economic conditions or financial markets could adversely affect both our own and our customers ability to meet the terms of sale or our suppliers ability to perform all their commitments to us. A slowdown in economic growth in our international markets, or a deterioration of credit or foreign exchange markets could adversely affect customers, suppliers and our overall business there. Customers in weakened economies may be unable to purchase our products, or it could become more expensive for them to purchase imported products in their local currency, or sell their commodities at prevailing international prices, and we may be unable to collect receivables from such customers.
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Our financial results could be harmed if we are not successful in executing our strategy and initiatives in connection with our restructuring programs, including Project Foundation.
We may need to implement activities under a restructuring program to manage market pressures and other risks should they negatively impact our results of operations. In December 2025, we announced management’s comprehensive plan, referred to as Project Foundation, to further optimize FMC’s cost structure and organizational operations. The restructuring program includes exiting certain high-cost active ingredient and formulation plants and transitioning production to lower-cost sources as well as implementing cost-reduction initiatives in Asia. Project Foundation may take longer than expected to implement, may result in higher-than-anticipated costs or operational disruptions, and may not achieve the expected efficiencies, cost savings or strategic objectives. In addition, the restructuring may adversely affect employee retention and productivity and could result in the loss of key personnel. Any of these factors could have an adverse impact on our business, results of operations and financial condition.
The Company relies in many countries and in varying degrees on distribution channels to access the market and reach farmers or other end use customers.
An abrupt and widespread shift in purchasing behaviors by channel partners and end-use customers has, in the past, negatively and materially impacted and may, in the future, negatively and materially impact the Company’s volumes across important markets and our results of operations. Such adverse effects could include, but are not limited to, materially reduced volumes purchased by customers resulting in reduced sales as well as higher volumes of unsold inventory and excess raw materials and correspondingly increased carrying costs.
confident
Litigation
negative
achievements
cautionary
cautions
undue
cautionary
disclaims
India Held for Sale Business
In July 2025, the Board of Directors approved a plan to divest the Company’s commercial business in India in response to ongoing commercial challenges in the country. FMC plans to continue to actively participate in the India market through a supply agreement with the eventual buyer of the business for its patented and data-protected portfolio, ranging from new diamide technologies to active ingredients and biologicals. The Company will continue its active ingredients manufacturing operations in India. The sale process is underway and is expected to conclude in 2026; and, therefore, the assets related to this business are classified as held for sale beginning in the third quarter of 2025. However, there is no assurance that we will be able to complete the divestment in the expected timeline and on favorable terms, or that we will be able to successfully enter into a supply agreement with the buyer. Although the business does not qualify for recognition as discontinued operations and will continue to be presented in the Company's reported results until a transaction is completed, we believe excluding India's operating results from our non-GAAP measures during the held for sale period, beginning with the third quarter of 2025, provides management and investors with useful supplemental information regarding our ongoing financial performance. In preparation for the sale, we took a series of target actions to optimize the business for transfer and reflect its fair value.
Total adjustment - approximately $522 million
The assets associated with the India commercial business held a carrying value of approximately $960 million at June 30, 2025. We evaluated the fair value of the assets associated with the business and determined the estimated fair value less costs to sell to be $450 million. Accordingly, we recorded $522 million of charges and write-downs in 2025 as a result of one-time commercial actions to prepare the India business for sale and an asset impairment charge in accordance with the held-for-sale accounting standards. This adjustment was reflected across multiple income statement line items as presented in the table below.
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Twelve Months Ended
December 31,
Affected Line Item in the Consolidated Statements of Income (Loss)
Revenue, Cost of sales and services, and Selling, general and administrative expenses
Asset impairment
Restructuring and other charges (income)
Third party provider costs
Restructuring and other charges (income)
India held for sale business
• Operating results, substantially pre-sale commercial adjustments ($320 million): These one-time actions commenced during the period included product returns and pricing changes designed to (1) accelerate receivables collection, (2) optimize the working capital mix of receivables and inventory, and (3) address contemporaneous changes in local indirect taxation. These adjustments impacted both the Revenue and Cost of sales and services line items on the consolidated statement of income (loss), resulting in revenue charges for the India business in the third quarter of 2025. These actions were taken in both collaboration with and in anticipation of customer behavior stemming from known indirect tax implications and broader market dynamics. These steps will help mitigate collection and local tax risks and position the business for a stronger sale outcome. The $320 million is made up of revenue charges of $422 million, a credit to cost of sales of $128 million and SG&A charges of $26 million.
• Asset impairment ($195 million): Following the commercial adjustments, we evaluated the remaining carrying value of the net assets associated with the business. The difference between the adjusted carrying value and the estimated fair value, less costs to sell, was recorded as an asset impairment, reflected within the Restructuring and Other Charges line item on the consolidated statement of income (loss).
Balance sheet impact - The combination of commercial adjustments and impairment resulted in a write-down of the net assets identified as held for sale to $450 million, as presented on the consolidated balance sheet as of December 31, 2025.
2025 Highlights
The following are the more significant developments in our businesses during the year ended December 31, 2025 compared to the year ended December 31, 2024:
• In December 2025, the Board of Directors approved management’s comprehensive plan, referred to as Project Foundation, to further optimize FMC’s cost structure and organizational operations. A key component of this initiative is the Manufacturing Restructuring Program, which focuses on redesigning FMC’s manufacturing footprint and includes exiting certain high-cost active ingredient and formulation plants and transitioning production to lower-cost sources. These actions are intended to create a cost-competitive structure that enables FMC’s products to better compete with generics while fully leveraging its innovative technology portfolio. In addition, we are implementing cost-reduction initiatives in Asia to reflect the smaller scale of the region’s business following the planned sale of the India commercial operations. We intend to continue to right-size our cost base and optimize the overall organizational structure, with a sustained focus on driving cost improvements and productivity amid ongoing challenges. However, these actions may take longer than expected to implement, may result in higher-than-anticipated costs or operational disruptions, and may not achieve the expected efficiencies, cost savings or strategic objectives. During the twelve months ended December 31, 2025, we incurred non-cash asset write-off and accelerated depreciation costs of $155.7 million primarily associated with the planned exit of certain production activities, other miscellaneous charges, including professional service provider costs, of $14.5 million and severance and employee separation costs of $1.8 million in connection with Project Foundation.
• Revenue of $3,467.4 million in 2025 decreased $778.7 million or approximately 18 percent versus last year primarily driven by one-time commercial actions taken to position the India business for sale. Excluding those actions which resulted in revenue charges for the India business beginning in the third quarter of 2025, revenue decreased 8 percent versus the prior year driven by a 6 percent price decline, roughly half of which was due to adjustments for certain diamide partners on "cost-plus" contracts. The remaining price decline was mostly attributed to competitive pressure on core portfolio products. On a regional basis, sales in Europe, Middle East and Africa increased by 4 percent, sales in Latin America decreased by 3 percent, and sales in North America decreased 6 percent. Sales in Asia, which included the adjustments for one-time commercial actions in India, decreased approximately 83 percent. A more detailed review of revenue excluding the commercial actions related to the India held for sale business is discussed under the section titled "Results of Operations."
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• Our gross margin of $1,283.0 million decreased by $365.9 million or approximately 22 percent versus the prior year gross margin of $1,648.9 million. Gross margin as a percent of revenue was 37 percent for the year ending December 31, 2025. Excluding the impact of the one-time commercial actions, our gross margin as a percent of revenue was 41 percent, which increased compared to a gross margin percentage of 39 percent in the prior year as a result of continued cost improvement partially offset by lower pricing during the period.
• Selling, general and administrative expenses increased from $644.6 million to $684.9 million, or approximately 6 percent versus the prior year period to support investment in new products. Research and development expenses of $266.1 million decreased $11.9 million or 4 percent. The decrease in spending on research and development relates to the timing of project expenses as well as continued cost reduction efforts in connection with restructuring activities.
• Net loss attributable to FMC stockholders of $2,238.9 million decreased $2,580.0 million compared to net income attributable to FMC stockholders of $341.1 million in the prior year primarily driven by a significant increase in restructuring and other charges recorded during the period. As a result of the significant decrease in our stock price during the fourth quarter of 2025, we performed a test of our goodwill and other intangible assets for impairment in connection with the preparation of our financial statements for the year ending December 31, 2025. We recorded a $1,356.2 million write-off of our remaining goodwill balance in connection with the impairment test. Additionally, as previously mentioned, we recorded $522 million of charges and write-downs in 2025 as a result of one-time commercial actions to prepare the India commercial business for sale and an asset impairment charge in accordance with the held-for-sale accounting standards. Adjusted after-tax earnings from continuing operations attributable to FMC stockholders of $372.0 million decreased $64.3 million or approximately 15 percent. See the disclosure of our adjusted earnings non-GAAP financial measurement under the section titled "Results of Operations" .
2026 Priorities and Strategic Review
In 2026, we plan to focus on executing our operational priorities, one of which is strengthening the balance sheet by paying down debt through asset sales and licensing agreements, including the previously announced sale of our India commercial business which is classified as held for sale. Our priorities also include improving the competitiveness of the company's legacy core portfolio, managing the post-patent transition for Rynaxypyr ® active, and supporting the growth of new active ingredients, such as Isoflex ® active, fluindapyr, Dodhylex ™ active and rimisoxafen. However, we expect continued pressure on price during the year due to competitive market dynamics for core portfolio products and lower Rynaxypyr ® active pricing. We will maintain our focus on reducing costs, which are expected to be lower for the full year despite expected pressure in the first quarter due to the timing of tariffs and manufacturing variances.
Additionally, as announced in February 2026, the Board of Directors has authorized the exploration of strategic options, including but not limited to, the sale of the company. FMC's four new active ingredients, along with its broader development pipeline, are unique and transformative. The company believes there is significant opportunity to enhance shareholder value and ensure the long-term success of our portfolio by accelerating growth and delivering enhanced financial results with additional investment in these technologies. The strategic review is at a preliminary stage, and there can be no assurance that the process will result in any transaction.
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Results of Operations — 2025, 2024 and 2023
Overview
The following charts provide a reconciliation of adjusted EBITDA, adjusted Earnings, revenue excluding India, organic revenue growth and return on invested capital ("ROIC"), all of which are non-GAAP financial measures, from the most directly comparable GAAP measure. Adjusted EBITDA, revenue excluding India, and organic revenue growth are provided to assist the readers of our financial statements with useful information regarding our operating results. Our operating results are presented based on how we assess operating performance and internally report financial information. For management purposes, we report operating performance based on earnings before interest, income taxes, depreciation and amortization, discontinued operations, and corporate special charges. Our adjusted earnings measure excludes corporate special charges, net of income taxes, discontinued operations attributable to FMC stockholders, net of income taxes, and certain non-GAAP tax adjustments. Beginning in the third quarter of 2025, the operating results of the India commercial business during the held for sale period are excluded from our adjusted EBITDA and adjusted Earnings measures. The adjustments previously noted, as well as the India held for sale business, are excluded by us in the measure we use to evaluate business performance and determine certain performance-based compensation. Organic revenue growth excludes the impacts of foreign currency changes and the India held for sale business during the held for sale period beginning in the third quarter of 2025, which we believe is a meaningful metric to evaluate our revenue changes. These items are discussed in detail within the "Other Results of Operations" section that follows. In addition to providing useful information about our operating results to investors, we also believe that excluding the effect of corporate special charges, net of income taxes, and certain non-GAAP tax adjustments from operating results and discontinued operations allows management and investors to compare more easily the financial performance of our underlying business from period to period. These measures should not be considered as substitutes for net income (loss) or other measures of performance or liquidity reported in accordance with U.S. GAAP.
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(in Millions)
Year Ended December 31,
Revenue (GAAP)
Costs and expenses
Costs of sales and services
Gross margin
Selling, general and administrative expenses
Research and development expenses
Restructuring and other charges (income)
Total costs and expenses
Income from continuing operations before non-operating pension, postretirement and other charges (income), interest expense, net and income taxes (1)
Non-operating pension, postretirement and other charges (income)
Interest expense, net
Income (loss) from continuing operations before income taxes
Provision (benefit) for income taxes
Income (loss) from continuing operations
Discontinued operations, net of income taxes
Net income (loss) (GAAP)
Adjustments to arrive at Adjusted EBITDA (non-GAAP):
Corporate special charges (income):
Restructuring and other charges (income) (3)
Non-operating pension, postretirement and other charges (income) (4)
India held for sale business (5)
Discontinued operations, net of income taxes
Interest expense, net
Depreciation and amortization
Provision (benefit) for income taxes
Adjusted EBITDA (non-GAAP) (2)
(1) Referred to as operating profit.
(2) Adjusted EBITDA is defined as operating profit excluding corporate special charges (income), depreciation and amortization expense, and the India held for sale business.
(3) The year ended December 31, 2025 includes charges incurred in connection with a shutdown of a product line at one of our manufacturing sites as part of Project Focus of $17.3 million, which are recorded to "Cost of Sales and services" on the consolidated statements of income (loss). Charges of $1,758.4 million recorded as "Restructuring and other charges (income)" on the consolidated statements of income (loss) for the year ended December 31, 2025 are also included in the reconciliation above. See Note 7 to the consolidated financial statements included within this Form 10-K for details of restructuring and other charges (income).
(4) Our non-operating pension and postretirement charges (income) are defined as those costs (benefits) related to interest, expected return on plan assets, amortized actuarial gains and losses and the impacts of any plan curtailments or settlements. These are excluded from our operating results and are primarily related to changes in pension plan assets and liabilities which are tied to financial market performance and we consider these costs to be outside our operational performance. We continue to include the service cost and amortization of prior service cost in our operating results noted above. These elements reflect the current year operating costs to our business for the employment benefits provided to active employees. The year ended December 31, 2025 also includes other charges of $3.3 million incurred as a make-whole premium in connection with the early redemption of $500 million of the Senior Notes due May 18, 2026.
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(5) Beginning with the third quarter of 2025, the operating results of the India commercial business are excluded from our Adjusted EBITDA during the held for sale period. For the year ended December 31, 2025, we have excluded $521.7 million in charges and write-downs related to the India held for sale business including charges of $319.8 million recognized in connection with one-time commercial actions to position the India business for sale, asset impairment charges of $194.8 million to record the assets held for sale to their estimated fair value less costs to sell, and $7.1 million in third party provider costs incurred in connection with the transaction. The one-time commercial actions to prepare the India business for sale resulted in a decrease to the Revenue and Cost of sales and services line items on the consolidated statement of income (loss) and the impairment charges as well as third party provider costs were recorded to Restructuring and other charges (income) on the consolidated statement of income (loss). Refer to the India Held for Sale Business section for further details.
ADJUSTED EARNINGS RECONCILIATION
(in Millions, except per share amounts)
Year Ended December 31,
Net income (loss) attributable to FMC stockholders (GAAP)
Corporate special charges (income), pre-tax (1)
India held for sale business (2)
Income tax expense (benefit) on Corporate special charges (income) (3)
Corporate special charges (income), net of income taxes
Adjustment for noncontrolling interest, net of tax on Corporate special charges (income)
Discontinued operations attributable to FMC Stockholders, net of income taxes
non-GAAP tax adjustments (4)
Adjusted after-tax earnings from continuing operations attributable to FMC stockholders (non-GAAP)
Diluted earnings per common share (GAAP)
Corporate special charges (income), pre-tax per diluted share
India held for sale business
Income tax expense (benefit) on Corporate special charges (income) per diluted share
Corporate special charges (income), net of income taxes per diluted share
Adjustment for noncontrolling interest, net of tax on Corporate special charges (income) per diluted share
Discontinued operations attributable to FMC stockholders, net of income taxes per diluted share
Tax adjustments per diluted share
Adjusted after-tax earnings from continuing operations attributable to FMC stockholders per diluted share (non-GAAP)
Average number of shares outstanding used in the adjusted after-tax earnings from continuing operations per diluted share computations (5)
(1) Represents restructuring and other charges (income), and non-operating pension, postretirement and other charges (income). The year ended December 31, 2025 includes charges incurred in connection with a shutdown of a product line at one of our manufacturing sites as part of Project Focus of $17.3 million, which are recorded to "Cost of Sales and services" on the consolidated statements of income (loss). Charges of $1,758.4 million recorded as "Restructuring and other charges (income)" on the consolidated statements of income (loss) for the year ended December 31, 2025 are also included in the reconciliation above.
(2) Beginning with the third quarter of 2025, we excluded the operating results of the India commercial business from our adjusted earnings during the held for sale period for non-GAAP purposes. For the twelve months ended December 31, 2025, we have excluded $521.7 million of charges and write-offs in connection with the India held for sale business as a result of one-time commercial actions to prepare the India business for sale and an asset impairment charge in accordance with the held-for-sale accounting standards. For further details, refer to note 5 in the Adjusted EBITDA reconciliation above.
(3) The income tax expense (benefit) on Corporate special charges (income) is determined using the applicable rates in the taxing jurisdictions in which the Corporate special charge or income occurred and includes both current and deferred income tax expense (benefit) based on the nature of the non-GAAP performance measure.
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(4) We exclude the GAAP tax provision, including discrete items, from the non-GAAP measure of income, and include a non-GAAP tax provision based upon the projected annual non-GAAP effective tax rate. The GAAP tax provision includes certain discrete tax items including, but are not limited to: income tax expenses or benefits that are not related to continuing operating results in the current year; tax adjustments associated with fluctuations in foreign currency remeasurement of certain foreign operations; certain changes in estimates of tax matters related to prior fiscal years; certain changes in the realizability of deferred tax assets and related interim accounting impacts; and changes in tax law. In 2024 and 2023, we recorded significant deferred tax assets, net of valuation allowance, due to various tax incentives granted to the Company's Swiss subsidiaries (the "Swiss Tax Incentives"). The initial recognition of these Swiss Tax Incentives did not impact our adjusted non-GAAP effective tax rate but will be considered annually as we realize the benefits. Management believes excluding these discrete tax items, as well as the impacts of the Swiss Tax Incentives, assists investors and securities analysts in understanding the tax provision and the effective tax rate related to continuing operating results thereby providing investors with useful supplemental information about FMC's operational performance. Refer to the explanation below on the provision for income taxes for further detail of the non-GAAP tax adjustments for the twelve months ended December 31, 2025.
(5) The average number of shares outstanding used in the twelve months ended December 31, 2025 diluted adjusted after-tax earnings from continuing operations per share computation (non-GAAP) includes 0.4 million diluted shares. This number of shares differs from the average number of shares outstanding used in diluted earnings per share computations (GAAP) as we had a net loss from continuing operations attributable to FMC stockholders during the twelve months ended December 31, 2025. Per share amounts may differ due to the average number of outstanding shares used in the calculation.
RECONCILIATION OF REVENUE (GAAP)
TO REVENUE EXCLUDING INDIA (NON-GAAP) (2)
Twelve Months Ended December 31,
Revenue (GAAP)
Less: Revenue from India commercial business (1)
Revenue excluding India (non-GAAP) (2)
(1) Beginning with the third quarter of 2025, revenue from the India commercial business is excluded from our results during the held for sale period for non-GAAP purposes. During the twelve months ended December 31, 2025, we took several one-time commercial actions to prepare the India commercial business for sale. For further details, refer to note 5 in the Adjusted EBITDA reconciliation above.
(2) Although the India held for sale business does not qualify for recognition as discontinued operations, we believe Revenue excluding India (non-GAAP) provides management and investors with useful supplemental information regarding our ongoing revenue performance.
ORGANIC REVENUE GROWTH RECONCILIATION
Twelve Months Ended December 31, 2025 vs. 2024
Total Revenue Change (GAAP)
Less: Revenue for India held for sale business for the twelve months ended December 31, 2025
Revenue Excluding India Change (non-GAAP) (1)
Less: Foreign Currency Impact
Organic Revenue Change (non-GAAP)
(1) Beginning with the third quarter of 2025, revenue from the India commercial business is excluded from our adjusted results during the held for sale period for non-GAAP purposes, as described in note 5 in the Adjusted EBITDA reconciliation above.
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RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO
FMC STOCKHOLDERS (GAAP) TO RETURN ON INVESTED CAPITAL ("ROIC")
NUMERATOR (NON-GAAP) AND ADJUSTED ROIC (USING NON-GAAP NUMERATOR)
We believe Adjusted ROIC provides management and investors with useful supplemental information regarding our utilization of capital provided by both equity and debt as well as our working capital and free cash flow management. Additionally, vesting of certain restricted stock awards granted to officers is connected to Adjusted ROIC as a performance metric.
Twelve Months Ended
December 31, 2025
Net income (loss) attributable to FMC stockholders (GAAP)
Interest expense, net, net of income taxes
Corporate special charges (income)
India held for sale business
Income tax expense (benefit) on Corporate special charges (income)
Discontinued operations attributable to FMC stockholders, net of income taxes
Tax adjustments
ROIC numerator (non-GAAP)
December 31, 2025
December 31, 2024
Total debt
Total FMC stockholders’ equity
Total debt and FMC stockholders' equity (GAAP)
ROIC denominator (2 yr average total debt and FMC stockholders' equity)
ROIC (using Net income (loss) attributable to FMC stockholders (GAAP) as numerator)
Adjusted ROIC (using non-GAAP numerator)
Results of Operations
In the discussion below, all comparisons are between the periods unless otherwise noted. In certain instances, parts included in the variance explanations in the discussion below may not sum to the total variance for the financial statement line item due to rounding.
Revenue
Revenue of $3,467.4 million decreased $778.7 million, or approximately 18 percent versus the prior year period primarily driven by revenue charges in India due to one-time commercial actions to prepare the India business for sale. Excluding the India held for sale business beginning in the third quarter of 2025, revenue decreased 8 percent versus the prior period driven by a price decline of 6 percent, roughly half of which was due to adjustments for certain diamide partners on "cost-plus" contracts. The remaining price decline was attributed to competitive pressure on core portfolio products and price reductions for branded Rynaxypyr® active. Volume improved 1 percent driven by increased demand for new active ingredients and expanded market access in Brazil. Foreign currency impacts were essentially flat to prior year. The removal of India revenue for the second half of 2025 as compared to the inclusion of India revenue in 2024 accounted for a decrease in revenue of approximately 3 percent during the period.
Revenue of $4,246.1 million decreased $240.7 million, or approximately 5 percent versus the prior year period. Volume improved as the year progressed and resulted in a 3 percent increase in revenue year over year. Price and foreign currency impacts were headwinds during the period of 6 percent and 2 percent, respectively. Higher volume was driven by the Company’s growth portfolio, and particularly the new active ingredients Isoflex ® active and fluindapyr.
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See below for a discussion of revenue by region.
Total Revenue by Region
Year Ended December 31,
(in Millions)
North America
Latin America
Europe, Middle East and Africa (EMEA)
Asia (1)
Total Revenue
1. During the twelve months ended December 31, 2025, we took several one-time commercial actions to prepare the India commercial business for sale. These one-time actions to position the India business for sale resulted in revenue charges of $421.9 million for the India business in 2025 and included the recognition of actual inventory returns during the period, an increase to the reserve for future sales returns, and various pricing actions to assist with the acceleration of receivable collection.
North America: Revenue decreased approximately 6 percent in the year ended December 31, 2025 driven by lower volumes from customers in the U.S. delaying purchases during the first quarter and expected destocking in Canada during the second quarter. Solid branded growth in the U.S., most notably in the growth portfolio, partially offset the impact of lower volumes. Lower pricing, primarily for branded products, also contributed to the decrease during the period.
Latin America: Revenue decreased approximately 3 percent for the year ended December 31, 2025 primarily due to lower pricing and limited volume growth driven by generic pressure in the market. In addition, low liquidity caused customer credit constraints in Brazil and Argentina and acted as a further inhibitor to growth. The decrease in revenue was partially offset by direct sales to cotton growers in Brazil and sales of new active ingredients fluindapyr and Isoflex ® active.
EMEA: Revenue increased approximately 4 percent (up approximately 3 percent organically) driven by strong volume gains mainly in the growth portfolio and aided by the recent launch of Isoflex ® active in Great Britain.
Asia: Revenue decreased approximately 83 percent compared to the prior year period primarily due to one-time commercial actions to prepare the India commercial business for sale. Revenue excluding India (non-GAAP) for the year ended December 31, 2025 was down 33 percent (down approximately 32 percent organically) year-over-year primarily due to lower volumes and significant pricing pressure caused by generic competition in the region.
North America: Revenue decreased approximately 3 percent in the year ended December 31, 2024 due to a significant decline in volumes during the first quarter as a result of continued pressure from channel destocking behavior. Volume recovery as a result of improved inventory levels in the channel during the following quarters partially offset the decrease in the first quarter. Unfavorable pricing actions also contributed to the decrease in the revenue during the period. Strong growth in fungicides, particularly from flutriafol and fluindapyr products, positively impacted sales in the region.
Latin America: Revenue decreased approximately 1 percent for the year ended December 31, 2024 compared to the prior year period. Organically, revenue increased approximately 5 percent driven by volume growth primarily related to branded diamides and Onsuva ™ , a fluindapyr-based fungicide. The volume growth was partially offset by unfavorable impacts from pricing actions, primarily in Brazil, during the period, which were caused by competitive pressure as demand returned as well as one-time customer incentives, offered primarily during the second quarter, aimed at addressing high cost inventory in the channel.
EMEA: Revenue decreased approximately 7 percent, or approximately 4 percent organically, versus the prior year period. Branded Cyazypyr ® active products contributed to volume growth in the region that partially offset the impact of registration removals and the rationalization of some lower margin products.
Asia: Revenue decreased approximately 14 percent, or approximately 12 percent organically, versus the prior year period caused by lower volumes, primarily due to ongoing destocking behavior, specifically in India. Pricing pressure caused by competitive pressure was an additional headwind in the region.
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Gross margin
Gross margin of $1,283.0 million decreased by $365.9 million, or approximately 22 percent versus the prior year period primarily due to 23 percent decrease caused by the one-time commercial actions taken in India. Cost improvement during the period resulted in a 21 percent increase to gross margin, respectively. The increase was partially offset by lower pricing and volumes of 15 percent and 2 percent, respectively, during the period. Foreign currency was a headwind of 3 percent. Gross margin percent of approximately 37 percent decreased compared to approximately 39 percent in the prior year period. Excluding the impact of the one-time commercial actions, our gross margin as a percent of revenue was 41 percent, which increased compared to gross margin percentage of 39 percent in the prior year as a result of continued cost improvement partially offset by lower pricing during the period.
Gross margin of $1,648.9 million decreased by $182.1 million, or approximately 10 percent versus the prior year period resulting from a 13 percent decrease due to lower pricing in all regions due to competitive pressure as demand returned. The decrease in price was partially offset by a 2 percent increase due to positive input cost improvement and a 1 percent increase from volume growth. Gross margin percent of approximately 38.8 percent slightly decreased from approximately 40.8 percent in the prior year period driven by higher unabsorbed fixed costs as well as registration removals during the period.
Selling, general and administrative expenses
Selling, general and administrative expenses of $684.9 million increased by $40.3 million, or approximately 6 percent versus the prior year period. The increase in selling, general and administrative expenses is primarily the result of investment to support new products as well as additional sales force in Brazil to support the expanded market access in the country.
Selling, general and administrative expenses of $644.6 million decreased by $89.7 million, or approximately 12 percent versus the prior year period. The decrease in selling, general and administrative expenses is primarily due to cost reduction measures implemented in connection with our Project Focus initiative as well as operating cost mitigation actions in effect since last year due to lower business performance.
Research and development expenses
Research and development expenses of $266.1 million decreased by $11.9 million, or approximately 4 percent compared to the previous year. The decrease in spending on research and development relates to the timing of project expenses as well as continued cost reduction efforts in connection with restructuring activities.
Research and development expenses of $278.0 million decreased by $50.8 million, or approximately 15 percent versus the prior year period. The decrease in research and development costs is a result of cost reduction efforts related to Project Focus. Reductions in research and development spending were done without sacrificing investments in areas such as Plant Health and our new active ingredient pipeline.
Other Results of Operations
Depreciation and amortization
Depreciation and amortization of $173.6 million decreased $2.7 million, or approximately 2 percent, as compared to 2024 of $176.3 million. The decrease was the result of the write off of certain assets during 2024 as part of our Project Focus restructuring initiative partially offset by certain intangible assets that began amortization in 2025.
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Depreciation and amortization of $176.3 million decreased $8.0 million, or approximately 4 percent, as compared to 2023 of $184.3 million. The decrease was the result of the write off of certain amortizable assets in the first half of 2024 as part of our Project Focus restructuring initiative.
Interest expense, net
Interest expense, net of $239.6 million increased by $3.8 million, or approximately 2 percent, compared to $235.8 million in 2024 primarily driven by refinancing activity. An increase of $18.9 million in connection with refinancing activity and higher foreign debt balances and rates was partially offset by a decrease of approximately $15.1 million due to lower short-term domestic balances and rates.
Interest expense, net of $235.8 million decreased by $1.4 million, or approximately 1 percent, compared to $237.2 million in 2023 primarily driven by lower debt balances and rates. Specifically, lower foreign balances and rates resulted in a decrease in interest expense of approximately $6.5 million. The decrease in interest expense was partially offset by an increase of approximately $5.1 million due to higher domestic short-term interest rates.
Corporate special charges (income)
Restructuring and other charges (income)
Our restructuring and other charges (income) are comprised of restructuring, assets disposals and other charges (income) as described below:
Year Ended December 31,
(in Millions)
Restructuring charges
Other charges (income), net
Total restructuring and other charges (income) (1)
(1) See Note 7 to the consolidated financial statements included in this Form 10-K for more information.
Restructuring charges of $271.5 million primarily includes restructuring charges related to Project Foundation as well as Project Focus. The charges of $172.0 million for Project Foundation incurred during the twelve months ended December 31, 2025 include non-cash asset write-off and accelerated depreciation costs of $155.7 million primarily associated with the planned exit of certain production activities, other miscellaneous charges, which includes professional service provider costs, of $14.5 million and severance and employee separation costs of $1.8 million. We also incurred charges related to Project Focus of $99.1 million consisting of $25.4 million of severance and employee separation costs, $27.8 million of other miscellaneous charges, including professional service provider costs, and write-offs of $45.9 million on assets identified for disposal, which includes $27.0 million of abandonment charges recorded in connection with a shutdown of a product line at one of our manufacturing locations.
In connection with Project Foundation, the Company expects to incur pre-tax restructuring charges over the life of the program in the range of approximately $560 million to $635 million, which is subject to future changes, in connection with these efforts. The Company expects non-cash asset write-off and/or accelerated depreciation charges in the range of $420 million to $440 million, primarily related to the planned exit of production activities and manufacturing operations at certain manufacturing sites. In addition to the non-cash write-off charges, the Company expects to incur $140 to $195 million of cash expenditures in connection with these activities: the Company estimates total severance charges and related benefit costs to be in the range of $50 to $80 million; the Company expects to incur cash consulting and other professional service fees totaling approximately $10 to $20 million to help execute these actions; and additionally, we may incur $80 to $95 million in other cash charges, such as decommissioning costs and contract termination charges. We may incur additional charges in connection with Project Foundation and will provide an estimate of any additional charges when known. Restructuring actions under the program are expected to be substantially complete by the end of 2027.
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As of December 31, 2025, we have implemented substantially all the activities associated Project Focus. The charges incurred during the year ended December 31, 2025 and prior years are within the expected range for pre-tax restructuring charges of approximately $425 million to $475 million over the life of the program. Project Focus-related charges include severance and related benefit costs, asset write-off charges, and contract abandonment charges. Any remaining amounts incurred in connection with remaining activities under the program, which are not expected to be material, will be reflected in our consolidated results of operations as they become probable and estimable or a triggering event is identified in accordance with the relevant accounting guidance.
During the year ended December 31, 2025, we also recognized income of $0.4 million related to previously implemented restructuring initiatives including a gain recognized on the disposition of a previously closed manufacturing site.
Other charges (income), net, of $1,688.8 million is primarily driven by a $1,356.2 million write-off of our entire goodwill balance during the fourth quarter. As a result of the recent significant decrease in our stock price, we performed a test of our goodwill and other intangible assets for impairment in connection with the preparation of our financial statements, which triggered the write-off. Other charges (income), net, also includes the asset impairment charge of $194.8 million and third party provider costs of $7.1 million incurred related to the India held for sale business. Following the commercial adjustments to prepare the India business for sale, we evaluated the remaining carrying value and recorded an impairment charge for the difference between the adjusted carrying value and the estimated fair value of the net assets associated with the business, less costs to sell. In addition to the goodwill write-off and charges related to the India held for sale business, other charges (income), net, include $99.4 million of charges associated with our environmental sites, a charge of $11.9 million due to changes in our estimate for Furadan ® disposal costs at our Middleport site, losses of $7.7 million related to the devaluation of the Argentine peso driven by government actions, and $11.7 million of other miscellaneous charges.
Restructuring and other charges (income) primarily includes restructuring charges incurred in connection with the Project Focus initiative. For the year ended December 31, 2024, we incurred $132.1 million of contract abandonment charges as a result of the continued evaluation of our supply chain footprint during the fourth quarter of 2024 and $53.3 million of non-cash asset write off charges resulting from the contract cessation with one of our third-party manufacturers during the second quarter of 2024. The decision to exit these agreements was driven in part by our ability to source these materials from lower cost locations. Charges incurred in connection with Project Focus also consist of $55.8 million in severance and employee separation charges, including costs associated with the CEO transition, $31.0 million of professional service provider costs and other miscellaneous charges associated with the project, accelerated depreciation of 20.5 million on assets identified for disposal in connection with the restructuring initiative, and $13.2 million of asset impairment charges.
During the year ended December 31, 2024, we also recognized income of $2.9 million related to previously implemented restructuring initiatives including a $3.1 million gain recognized on the disposition of a previously closed manufacturing site.
Other charges (income), net, of $(83.2) million is comprised of a gain, net of full year incurred transaction costs, of $174.4 million from the sale of our GSS business, which was completed on November 1, 2024. The divestiture of GSS, which includes a line of products that serve a diverse mix of non-crop markets such as golf courses, professional sports stadiums and pest control, is a key step in FMC's strategic plan to focus solely on innovating products and services for the global crop protection market. The gain from the GSS sale was partially offset by $74.7 million of charges associated with our environmental sites and $16.5 million of other miscellaneous charges.
Restructuring and other charges (income) includes $40.1 million of severance and employee separation costs and $5.4 million of provider costs associated with the Project Focus restructuring initiative. Other restructuring costs of $8.7 million relate to employee separation and asset impairment costs incurred as part of various ongoing initiatives. These restructuring charges were offset by a $5.8 million gain recognized on the disposition of land related to a previously closed manufacturing facility.
Other charges (income), net, of $163.9 million is comprised of $75.2 million in currency related charges driven by significant devaluation actions taken by the Argentine Government during the fourth quarter of 2023 as well as similar devaluation actions in Pakistan and Argentina during previous quarts of 2023. Other charges (income), net, also includes $13.0 million in charges primarily resulting from the third quarter acquisition of in-process research and development assets that do not meet the criteria for capitalization. We also incurred $66.9 million in environmental charges associated with remediation and other miscellaneous charges of $8.8 million.
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Non-operating pension and postretirement charges (income)
Charges for each of the years ended December 31, 2025 and 2024 were $18.7 million and $18.2 million
Charges for each of the years ended December 31, 2024 and 2023 were $18.2 million.
Provision (benefit) for income taxes
In 2025, we recognized an income tax expense of $314.2 million, which resulted in an effective tax rate of negative 16.7 percent. For the year ended December 31, 2024, we recorded an income tax benefit of $150.9 million resulting in an effective tax rate of negative 59.8 percent. For the year ended December 31, 2023, we recorded an income tax benefit of $1,119.3 million resulting in an effective tax rate of negative 372.9 percent. Note 11 to the consolidated financial statements included in this Form 10-K includes more details on the drivers of the GAAP effective rate and year-over-year changes.
We believe showing the reconciliation below of our GAAP to non-GAAP effective tax rate provides investors with useful supplemental information about our tax rate on the core underlying business.
Year Ended December 31,
(in Millions)
Income (Expense)
Tax Provision (Benefit)
Effective Tax Rate
Income (Expense)
Tax Provision (Benefit)
Effective Tax Rate
Income (Expense)
Tax Provision (Benefit)
Effective Tax Rate
GAAP - Continuing operations
Corporate special charges (income)
Revisions to valuation allowances of historical deferred tax assets (1)
Net impact of Switzerland tax incentives (1)
Foreign currency and other discrete items (1)
non-GAAP - Continuing operations
(1) Refer to note 3 of the Adjusted Earnings Reconciliation table within this section of this Form 10-K for an explanation of tax adjustments.
The primary drivers for the fluctuations in the effective tax rate for each period are provided in the table above.
During the three months ended December 31, 2023, the Company’s Swiss subsidiaries were granted ten-year tax incentives effective for 2023 and retroactively for 2021 and 2022. The tax incentives were awarded for the Company’s commitment to invest in additional headcount and transfer significant intellectual property as well as establishing a new global technology and innovation center in Switzerland. Deferred tax benefits of $1,149 million and related valuation allowances of $318 million were recorded during the three months ended December 31, 2023 to reflect the net estimated future reductions in tax of $831 million associated with the incentives.
In connection with our plans to establish a global technology and innovation center in Switzerland, we initiated changes to our corporate entity structure, including intra-entity transfers of certain intellectual property, during the second quarter of 2024. As a result, we recorded a net tax benefit of approximately $300 million. This benefit, net of valuation allowance, was primarily a result of the recognition of a step-up in tax basis to the fair value of the transferred intellectual property by one of the Company’s Swiss subsidiaries. In addition, local tax impacts associated with the disposition of the transferred intellectual property were recorded as well as an increase in our valuation allowance associated with Swiss nonrefundable tax credits as a result of indirect effects of the transferred intellectual property. During the fourth quarter of 2024 and 2025, the Company recorded additional valuation allowances of approximately $120 million and $285 million, respectively, as a result of updated projections of future earnings associated with the 2023 deferred tax benefits noted above.
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Historically, FMC’s Brazil valuation allowance position was based on long-standing local transfer pricing rules, as well as certain material favorable permanent statutory tax deductions available to FMC Brazil as part of local tax law. During the three months ended December 31, 2023, the Company released its FMC Brazil valuation allowance and recorded a tax benefit of approximately $223 million as a result of the Brazilian Government enacting a new tax law that significantly limits FMC Brazil’s ability to benefit in the future from the material favorable permanent statutory tax deductions previously available as part of local tax law.
Excluding the items in the table above, changes in the non-GAAP effective tax rate were primarily due to the impact of geographic mix of earnings among our global subsidiaries. See Note 11 to the consolidated financial statements included within this Form 10-K for additional details related to the provisions for income taxes on continuing operations, as well as items that significantly impact our effective tax rate.
Discontinued operations, net of income taxes
Our discontinued operations primarily reflect adjustments to retained liabilities from previously discontinued operations and include environmental liabilities, other postretirement benefit liabilities, self-insurance, long-term obligations related to legal proceedings and historical restructuring activities. See Note 9 to the consolidated financial statements included within this Form 10-K for additional details on our discontinued operations.
Discontinued operations, net of income taxes represented a loss of $36.6 million in 2025 compared to a loss of $61.8 million in 2024. The loss during both periods was primarily due to adjustments related to the retained liabilities from our previously discontinued operations. The loss in 2025 was partially offset by a $34.5 million reduction in our required legal reserve due to a decrease in outstanding cases.
Discontinued operations, net of income taxes represented a loss of $61.8 million in 2024 compared to a loss of $98.5 million in 2023. The loss during both periods was primarily due to adjustments related to the retained liabilities from our previously discontinued operations. The twelve months ended December 31, 2024 includes an offsetting gain of $18.0 million recognized as the result of an insurance settlement for retained legal reserves.
Net income (loss)
The net loss recognized during the period was $2,237.4 million as compared to net income of $341.6 million in the prior year period. The change year over year is primarily attributable to the goodwill write off of $1,356.2 million and approximately $522 million of adjustments recorded in connection with preparing the India commercial business for sale. The change in the provision for income taxes also contributed to the decrease in net income during the period. The benefit for income taxes for the twelve months ended December 31, 2024 was the result of a tax benefit of approximately $300 million recorded due to changes in our corporate entity structure in connection with our plans to establish a global technology and innovation center in Switzerland. In comparison, we recorded a $314.2 million provision for income taxes during the twelve months ended December 31, 2025.
The only difference between Net income (loss) and Net income (loss) attributable to FMC stockholders is noncontrolling interest.
Net income decreased to $341.6 million from $1,321.0 million primarily as a result of a decrease of $968.4 million to our benefit for income taxes. We recorded significant one-time tax benefits in the prior year related to tax incentives granted to our Swiss subsidiaries as discussed above. In the fourth quarter of 2024, we recorded higher valuation allowances on these tax benefits. In 2024, we also recorded a $300 million income tax benefit in connection with the changes to our corporate entity structure made as part of establishing our global technology and innovation center in Switzerland. Additionally, lower gross margin, as discussed above, negatively impacted our results for the period. The change in our gross margin and benefit for income taxes was partially offset by a gain of $18.0 million in discontinued operations during the second quarter as the result of an insurance settlement for retained legal reserves. Our research and development expenses and our selling, general, and administrative expenses were also lower as a result of cost containment.
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Adjusted EBITDA (non-GAAP)
Adjusted EBITDA of $842.7 million decreased $59.9 million, or approximately 7 percent versus the prior year period. Adjusted EBITDA was impacted by favorable costs of approximately 32 percent. The cost improvement was offset by a decrease in price and volumes impacting adjusted EBITDA by 29 percent and 3 percent, respectively. Foreign exchange impacts were also a headwind of 2 percent during the period. Adjusted EBITDA for the year ended December 31, 2024 includes contributions from the India commercial business. However, the year ended December 31, 2025 excludes the operating results of the India commercial business for six months as the held for sale period began in the third quarter of 2025. This exclusion accounts for 5 percent of the decrease in Adjusted EBITDA as compared to the prior year period.
Adjusted EBITDA of $902.6 million decreased $75.4 million, or approximately 8 percent versus the prior year period. Cost as well as volume improvement of approximately 14 percent and 1 percent, respectively, were fully offset by unfavorable pricing impacts of approximately 25 percent. Favorable foreign currency impacts of approximately 2 percent also increased adjusted EBITDA.
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Liquidity and Capital Resources
As a global agricultural sciences company, we require cash primarily for seasonal working capital needs, capital expenditures, and return of capital to shareholders. We plan to meet these liquidity needs through available cash, cash generated from operations, and borrowings under our committed Revolving Credit Facility as well as other liquidity facilities, and in certain instances access to debt capital markets. On February 5, 2026, we announced that the Company is engaging in a strategic review to explore options to enhance shareholder value. Potential strategic paths may include partnerships, joint ventures, mergers, acquisitions, or licensing transactions, a combination of these, or other strategic transactions. Information involving our material cash requirements is detailed below.
Cash
Cash and cash equivalents at December 31, 2025 and 2024, were $584.5 million and $357.3 million, respectively. Of the cash and cash equivalents balance at December 31, 2025, $577.3 million was held by our foreign subsidiaries. We have established plans to repatriate cash from certain foreign subsidiaries with minimal tax on a go forward basis. Other cash held by foreign subsidiaries is generally used to finance subsidiaries’ operating activities and future foreign investments. See Note 11 to the consolidated financial statements included within this Form 10-K for more information on our indefinite reinvestment assertion.
Outstanding debt
At December 31, 2025, we had total debt of $4,074.9 million as compared to $3,365.3 million at December 31, 2024. Total debt included $2,769.8 million and $3,027.9 million of long-term debt (excluding current portions of $585.6 million and $76.1 million) at December 31, 2025 and 2024, respectively. Our short-term debt consists of foreign borrowings and borrowings under our committed Revolving Credit Facility. Foreign borrowings decreased from $135.7 million at December 31, 2024 to $76.5 million at December 31, 2025. We had borrowings of $643.0 million under our Revolving Credit Facility at December 31, 2025. We had no commercial paper borrowings at December 31, 2025 as compared to outstanding commercial paper of $125.6 million at December 31, 2024. We provide parent-company guarantees to lending institutions providing credit to our foreign subsidiaries.
On May 27, 2025, the Company completed the sale of $750 million aggregate principal amount of 8.45% Subordinated Notes due November 1, 2055. The Company used the net proceeds from this offering to redeem $500 million of the senior notes due May 18, 2026 and for general corporate purposes. The Company paid a make-whole premium of $3.3 million in connection with the early redemption of the senior notes, which is recorded within "Non-operating pension, postretirement and other charges (income)" on the consolidated statement of income (loss). Fees incurred to secure the Subordinated Notes have been deferred and will be amortized over the terms of the arrangement.
As of December 31, 2025, we were in compliance with all of our debt covenants. In February 2025 and December 2025, we entered into new amendments to our Revolving Credit Facility to amend the maximum leverage and minimum interest coverage ratios and to extend the maturity date of the facility to 2028. Increases to the Company’s regular quarterly dividend are limited and other restrictions are effective as defined in the amended agreement entered into in December 2025. Our ability to meet certain restrictive covenants and guarantees in our Revolving Credit Facility and other debt instruments will be subject to economic conditions and to financial, market, and competitive factors, many of which are beyond our control. If our business does not perform in line with current expectations, we will be at risk of non-compliance with such covenants and guarantees. See Note 12 to the consolidated financial statements included within this Form 10-K for further details.
Our total debt maturities, excluding discounts, is $4,105.5 million at December 31, 2025, with $1,305.1 million payable in the next 12 months. As of December 31, 2025, we had contractual interest obligations of $3,480.3 million outstanding, with $166.5 million payable in the next 12 months. Contractual interest is the interest we are contracted to pay on our long-term debt obligations. We do not have any long-term debt subject to variable interest rates at December 31, 2025.
Access to credit and future liquidity and funding needs
As of December 31, 2025, borrowings under our Revolving Credit Facility were $643.0 million and letters of credit outstanding under the Revolving Credit Facility totaled $209.8 million. At December 31, 2025, our remaining borrowing capacity under our credit facility was $1,147.2 million. In accordance with U.S. GAAP, we have classified the borrowings under the Revolving Credit Facility as short-term debt. The Company intends to refinance any draw under the line of credit with successive short-term borrowings, as needed, through the maturity date in 2028. At December 31, 2025, we had no borrowings outstanding under the commercial paper program. Our balances under the Revolving Credit Facility and commercial paper program fluctuate from year to year depending on working capital needs.
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Working Capital Initiatives
We offer to a select group of suppliers a voluntary supply chain finance program as part of our continued efforts to improve our working capital efficiency. We do not believe that changes in the availability of the supply chain finance program would have a significant impact on our liquidity. See Note 2 for more information on the key terms and balances of the program.
From time to time, the Company may sell receivables on a non-recourse basis to third-party financial institutions. These sales are normally driven by specific market conditions, including, but not limited to, foreign exchange environments, customer credit management, as well as other factors where the receivables may lay. See Note 8 for more information on receivables factoring.
Commitments
We provide guarantees to financial institutions on behalf of certain customers, principally customers in Brazil for their seasonal borrowing. The total of these guarantees was $53.1 million at December 31, 2025. These guarantees arise during the ordinary course of business from relationships with customers and nonconsolidated affiliates. Non-performance by the guaranteed party triggers the obligation requiring us to make payments to the beneficiary of the guarantee. Based on our experience these types of guarantees have not had a material effect on our consolidated financial position or on our liquidity. Our expectation is that future payment or performance related to the non-performance of others is considered unlikely.
In connection with certain of our property and asset sales and divestitures, we have agreed to indemnify the buyer for certain liabilities, including environmental contamination and taxes that occurred prior to the date of sale. Our indemnification obligations with respect to these liabilities may be indefinite as to duration and may or may not be subject to a deductible, minimum claim amount or cap. In cases where it is not possible for us to predict the likelihood that a claim will be made or to make a reasonable estimate of the maximum potential loss or range of loss, no specific liability has been recorded. If triggered, we may be able to recover certain of the indemnity payments from third parties. In cases where it is possible, we have recorded a specific liability within our Reserve for Discontinued Operations. Refer to Note 9 to the consolidated financial statements included within this Form 10-K for further details.
Taxes, Pension, Environmental, and Other Discontinued Liabilities
As of December 31, 2025, the liability for uncertain tax positions was $59.6 million. Our consolidated balance sheets contain accrued pension and other postretirement benefits, our environmental liabilities, and our other discontinued liabilities for which we are unable to make a reasonably reliable estimate of the periods in which these liabilities might be paid beyond 2026. We believe any liability arising from potential environmental obligations is not likely to have a material adverse effect on our liquidity or financial condition as it may be satisfied over many years. See our discussion under 2025 Cash Flow Outlook in the Free Cash Flow section within this Form 10-K for information on these liabilities and the related expected payments in 2026.
Derivatives
At times we can be in a derivative liability position that can require future cash obligations. However, as of December 31, 2025, we had no such obligations.
Leases
We have lease arrangements for equipment and facilities, including office spaces, IT equipment, transportation equipment, and machinery equipment. As of December 31, 2025, we had fixed lease payment obligations of $149.0 million, with $31.0 million payable within 12 months.
Purchase obligations
Purchase obligations consist of agreements to purchase goods and services that are enforceable and legally binding and specify all significant terms, including fixed or minimum quantities to be purchased, price provisions and timing of the transaction. We have entered into a number of purchase obligations for the sourcing of materials and energy where take-or-pay arrangements apply. As of December 31, 2025, our purchase obligations were $179.9 million, with $68.5 million payable in the next twelve months. The majority of the minimum obligations under these contracts are take-or-pay commitments over the life of the contract and not a year by year take-or-pay. As such, the obligations related to these types of contacts are considered payable in the earliest period in which the minimum obligation could be due under these types of contracts.
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Statement of Cash Flows
Cash provided (required) by operating activities of continuing operations was $(6.2) million, $736.7 million and $(300.3) million for 2025, 2024 and 2023, respectively.
The table below presents the components of net cash provided (required) by operating activities of continuing operations.
(in Millions)
Year ended December 31,
Income from continuing operations before non-operating pension and postretirement charges (income), interest expense, net and income taxes (GAAP)
Restructuring and other charges (income), non-cash commercial actions for India held for sale business, transaction-related charges and depreciation and amortization
Change in trade receivables, net (1)
Change in guarantees of vendor financing
Change in advance payments from customers (2)
Change in accrued customer rebates (3)
Change in inventories (4)
Change in accounts payable (5)
Change in all other operating assets and liabilities (6)
Restructuring and other spending (7)
Environmental spending, continuing, net of recoveries (8)
Pension and other postretirement benefit contributions (9)
Net interest payments (10)
Tax payments, net of refunds (11)
Cash provided (required) by operating activities of continuing operations (GAAP)
(1) Both periods include the impacts of seasonality and the receivable build intrinsic in our business. The change in cash flows related to trade receivables in 2025 was driven by lower revenue year over year as well as timing of collections. Collection timing is more pronounced in certain countries such as Brazil where there may be terms significantly longer than the rest of our business. Additionally, timing of collection is impacted as amounts for both periods include carry-over balances remaining to be collected in Latin America, where collection periods are measured in months rather than weeks.
(2) Advance payments are typically received in the fourth quarter of each year, primarily in our North America operations as revenue associated with advance payments is recognized, generally in the first half of each year following the seasonality of that business, as shipments are made and title, ownership and risk of loss pass to the customer. The activity in 2025 was consistent with the same period in 2024. The change in 2024 was driven by higher advance payments received during 2024 compared to the same period in 2023 offset by the higher application of those advancesagainst current period sales.
(3) These rebates are primarily associated within North America, and to a lesser extent Brazil, and in North America generally settle in the fourth quarter of each year given the end of the respective crop cycle. The changes year over year are mostly associated with lower revenues and the mix in sales eligible for rebates and incentives as well as timing of certain rebate payments.
(4) Changes in inventory reflect the inventory build required during 2025 to meet projected demand compared to the 2024 period which was impacted by a lower sales outlook as a result of the channel destocking. The changes in inventory during 2024 reflect the lower inventory build required following the lower sales volume in 2023 resulting from the channel destocking. Higher sales during the second half of 2024 contributed to the decrease in inventories. The change in cash flows during 2023 is the result of lower than expected sales volume during the period.
(5) The change in cash flows related to accounts payable in 2025 was driven by the timing of payments made to suppliers and vendors. As of December 31, 2025, approximately 86 percent of our accounts payable balance was considered current, which we define as outstanding less than 30 days past the invoice due date. In accordance with our standard terms, invoices are held for payment when there is an open dispute with the vendor. The remaining balance of accounts payable primarily consists of invoices that meet this criteria. As of December 31, 2024, approximately 99 percent of our accounts payable balance was considered current under the same definition. The change in cash flows related to accounts payable in 2024 was driven by the timing of payments to suppliers and vendors following a period of reducing spending in the prior period. The change in cash flows related to accounts payable in 2023 is primarily due to lower raw material inventory purchases due to the decline in demand and, to a lesser extent, the timing of payments made to suppliers and vendors
(6) Changes in all periods presented primarily represent timing of payments associated with all other operating assets and liabilities.
(7) See Note 7 to the consolidated financial statements included within this Form 10-K for further details.
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(8) In addition to the environmental cash spend presented in the table above, our results for each of the years presented also include environmental charges for environmental remediation of $99.4 million, $74.7 million and $66.9 million, respectively. The amounts represent environmental remediation spending which were recorded against pre-existing reserves, net of recoveries. Environmental obligations for continuing operations primarily represent obligations at shut down or abandoned facilities within businesses that do not meet the criteria for presentation as discontinued operations. The amounts recorded against pre-existing reserves in 2025 will be spent in future years.
(9) There were no voluntary contributions to our U.S. qualified defined benefit plan, which is slightly over funded, in 2025, 2024 and 2023.
(10) Interest payments increased in 2025 due to refinancing activity and higher foreign debt balances and rates. The increase was partially offset by a decrease due to lower short-term domestic balances and rates.
(11) Amounts shown in the chart represent net tax payments of our continuing operations across various jurisdictions.
Cash provided (required) by operating activities of discontinued operations was $(74.0) million, $(65.6) million and $(86.1) million for 2025, 2024 and 2023, respectively.
Cash required by operating activities of discontinued operations in 2025 is directly related to environmental spending of $42.3 million as well as $31.7 million for other postretirement benefit liabilities, self-insurance, long-term obligations related to legal proceedings, collectively. 2024 and 2023 spending were of a similar nature. Discontinued operations for 2024 also includes cash proceeds, net of fees of $18.0 million received as the result of an insurance settlement for retained legal reserves. Additionally, during 2023, we paid $16.5 million for a portion of settlement amount related to one of our discontinued foreign environmental remediation sites and the remaining payment of $11.3 million was paid in 2024.
Cash provided (required) by investing activities of continuing operations was $(99.7) million, $263.6 million and $(154.4) million for 2025, 2024 and 2023, respectively.
Cash required by investing activities of continuing operations for 2025 of $99.7 million decreased compared to cash provided by investing activities for 2024 of $263.6 million. In 2024, we received proceeds, net of the preliminary working capital adjustment, of approximately $340 million in connection with the completion of the sale of our Global Specialty Solutions ("GSS") business to Environmental Science US, LLC d/b/a Envu, which was completed on November 1, 2024. During the twelve months ended December 31, 2025, we also paid approximately $11.7 million to Envu as a true-up of the final working capital adjustment related to the sale. The timing of payments related to capital expenditures as contributed to the change year over year.
Cash required for 2023 is primarily due to capital expenditures for increased capacity, and to a lesser extent, acquisition related spending associated with the acquired IPR&D assets completed during the third quarter of 2023.
Cash provided (required) by financing activities of continuing operations was $386.0 million, $(870.1) million and $331.5 million in 2025, 2024 and 2023, respectively.
Cash provided by financing activities of continuing operations increased during the twelve months ended December 31, 2025 compared to the same period in the prior year primarily due to the proceeds of $750 million from the Subordinated Notes. The increase was partially offset by the redemption of $500 million of senior notes and financing fees associated with the issuance of the Subordinated Notes. There were no share repurchases during the twelve months ended December 31, 2025 and 2024 under the publicly announced program.
The change in cash provided by financing activities in 2024 is primarily due to lower commercial paper borrowings during the period as well as the absence of the net impact of the 2023 bond issuance and repayment of the 2021 term loan. The proceeds from the GSS sale were used to pay down outstanding debt. There were no share repurchases during 2024 under the publicly announced program.
The change in cash provided by financing activities in 2023 is primarily due to higher commercial paper balances and an increase in short term foreign borrowings as well as the proceeds from the Senior Notes. This increase was partially offset by the repayment of the $800 million term loan, and $75 million in repurchases of common stock under the publicly announced program.
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Free Cash Flow
We define free cash flow, a non-GAAP financial measure, as all cash inflows and outflows excluding those related to financing activities (such as debt repayments, dividends, and share repurchases) and acquisition related investing activities. Additionally, in 2024, free cash flow excludes the proceeds, net of transaction costs, from the sale of our GSS business. Therefore, our calculation of free cash flow will almost always result in a lower amount than cash from operating activities from continuing operations, the most directly comparable U.S. GAAP measure. However, the free cash flow measure is consistent with management's assessment of operating cash flow performance and we believe it provides a useful basis for investors and securities analysts about the cash generated by routine business operations, including capital expenditures, in addition to assessing our ability to repay debt, fund acquisitions including cost and equity method investments, and return capital to shareholders through share repurchases and dividends.
Our use of free cash flow has limitations as an analytical tool and should not be considered in isolation or as a substitute for an analysis of our results under U.S. GAAP. First, free cash flow is not a substitute for cash provided (required) by operating activities of continuing operations, as it is not a measure of cash available for discretionary expenditures since we have non-discretionary obligations, primarily debt service, that are not deducted from the measure. Second, other companies may calculate free cash flow or similarly titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of free cash flow as a tool for comparison. Additionally, the utility of free cash flow is further limited as it does not reflect our future contractual commitments and does not represent the total increase or decrease in our cash balance for a given period. Because of these and other limitations, free cash flow should be considered along with cash provided (required) by operating activities of continuing operations and other comparable financial measures prepared and presented in accordance with U.S. GAAP.
The table below presents a reconciliation of free cash flow from the most directly comparable U.S. GAAP measure.
FREE CASH FLOW RECONCILIATION
(in Millions)
Year ended December 31,
Cash provided (required) by operating activities of continuing operations (GAAP) (1)
Capital expenditures (2)
Other investing activities (2)(3)
Proceeds from land disposition (4)
Capital additions and other investing activities
Cash provided (required) by operating activities of discontinued operations (5)
Divestiture transaction costs (6)
Free cash flow (non-GAAP)
(1) Includes cash payments made in connection with our Project Focus transformation program of $93.9 million and $106.2 million for the years ended December 31, 2025 and 2024. For additional detail on Project Focus, see Note 7.
(2) Components of cash provided (required) by investing activities of continuing operations. Refer to the below discussion for further details.
(3) Included in the amounts is cash spending associated with contract manufacturers of $2.7 million and $2.9 million for the years ended December 31, 2024 and 2023, respectively.
(4) During 2023, we received the final payment of $5.8 million related to the agreement with the Shanghai Municipal People's Government.
(5) Refer to the above discussion for further details.
(6) Represents transactional-related costs such as legal and professional third-party fees associated with the sale of our GSS business. Proceeds from the sale of our GSS business are excluded from free cash flow; therefore, we have also excluded the related transaction costs from free cash flow.
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2026 Cash Flow Outlook
Our cash needs for 2026 include operating cash requirements (particularly working capital as well as environmental, asset retirement obligation, and restructuring spending), and capital expenditures as well as mandatory payments of debt and dividend payments. We plan to meet our liquidity needs through available cash, cash generated from operations and borrowings under our committed Revolving Credit Facility. At December 31, 2025 our remaining borrowing capacity under our credit facility was $1,147.2 million.
We expect 2026 cash provided (required) by operating activities of continuing operations and free cash flow (non-GAAP) to increase primarily due lower cash taxes and improved working capital performance, including other assets and liabilities, partially offset by lower Adjusted EBITDA and higher restructuring spending. We also expect the proceeds from the anticipated completion of the sale of our India commercial business to be used to pay down debt.
Key cash requirements included in cash provided by operating activities of continuing operations
Pension
We do not expect to make any voluntary cash contributions to our U.S. qualified defined benefit pension plan in 2026. The plan is slightly overfunded and our portfolio is comprised of 100 percent fixed income securities and cash. Our investment strategy is a liability hedging approach with an objective of maintaining the funded status of the plan such that the funded status volatility is minimized and the likelihood that we will be required to make significant contributions to the plan is limited.
Environmental
Projected 2026 spending, net of recoveries includes approximately $50 million to $60 million of net environmental remediation spending for our sites accounted for within continuing operations. Environmental obligations for continuing operations primarily represent obligations at shut down or abandoned facilities within businesses that do not meet the criteria for presentation as discontinued operations.
Projected 2026 spending, net of recoveries includes approximately $40 million to $50 million of net environmental remediation spending for our discontinued sites. These projections include spending as a result of a settlement reached in 2019 at our Middleport, New York site of $10 million maximum per year, on average, until the remediation is complete.
Total projected 2026 environmental spending, inclusive of sites accounted for within both continuing operations and discontinued sites, is expected to be in the range of $90 million to $110 million.
Restructuring and asset retirement obligations
We expect to make payments of approximately $130 million to $155 million in 2026, which primarily relate to Project Foundation and Project Focus activities. As previously noted in the section titled "Results of Operations ," we expect to incur approximately $560 million to $635 million of pre-tax restructuring charges in connection with Project Foundation in total over the life of the program. This includes $420 million to $440 million of non-cash asset write-off charges. We expect cash payments of approximately $65 million during 2026 in connection with Project Foundation. We have implemented substantially all the activities associated with Project Focus. However, we expect cash payments of approximately $63 million primarily related to the cash payments required in association with contract abandonment activities executed under the program.
Capital additions and other investing activities
Projected 2026 capital expenditures and expenditures related to contract manufacturers are expected to be in the range of approximately $90 million to $110 million. The spending is mainly driven by investments for our new products. Expenditures related to contract manufacturers are included within " other investing activitie s."
Share repurchases
Except for purchases associated with our equity compensation plans, we do not anticipate any share repurchases during 2026 in compliance with the amendment to the Company's credit agreement. See Item 5. Market for the Registrant's Common Equity, Related Stockholders Matters and Issuer Purchases of Equity Securities for additional information regarding the Company's publicly announced repurchased program authorized in February 2022.
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Dividends
For the years ended December 31, 2025, 2024 and 2023, we paid $291.3 million, $290.6 million and $290.5 million in dividends, respectively. As part of a broader response to the challenges the company is facing and to further prioritize debt reduction, the Board of Directors in October 2025 made the decision to reduce the quarterly dividend to $0.08 per share. On January 15, 2026, we paid dividends aggregating $10.0 million to our shareholders of record as of December 31, 2025. This amount is included in "Accrued and other liabilities" on the consolidated balance sheet as of December 31, 2025. We expect to continue to make quarterly dividend payments. Future cash dividends, as always, will depend on a variety of factors, including earnings, capital requirements, financial condition, general economic conditions and other factors considered relevant by us and is subject to final determination by our Board of Directors. The company has a long history of returning cash to shareholders and will continue to evaluate its capital allocation on an ongoing basis. As described in Note 12 to the consolidated financial statements, increases to the Company’s regular quarterly dividend are limited in connection with the Company's credit agreement as amended in December 2025.
Contingencies
See Note 19 to our consolidated financial statements included within this Form 10-K.
Recently Adopted and Issued Accounting Pronouncements and Regulatory Items
See Note 2 "Recently Issued and Adopted Accounting Pronouncements and Regulatory Items " to our consolidated financial statements included within this Form 10-K.
Fair Value Measurements
See Note 18 to our consolidated financial statements included in this Form 10-K for additional discussion surrounding our fair value measurements.
Critical Accounting Policies and Estimates
Our consolidated financial statements are prepared in conformity with U.S. generally accepted accounting principles ("U.S. GAAP"). The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We have described our accounting policies in Note 1 "Principal Accounting Policies and Related Financial Information " to our consolidated financial statements included in this Form 10-K. We have reviewed these accounting policies, identifying those that we believe to be critical to the preparation and understanding of our consolidated financial statements. We have reviewed these critical accounting policies with the Audit Committee of the Board of Directors. Critical accounting policies are central to our presentation of results of operations and financial condition in accordance with U.S. GAAP and require management to make estimates and judgments on certain matters. We base our estimates and judgments on historical experience, current conditions and other reasonable factors. Our most critical accounting estimates and assumptions, which are those that involve a significant level of estimation uncertainty and have had, or are reasonably likely to have, a material impact on our financial condition or results of operations, include: Impairments and valuation of long-lived and indefinite-lived assets, Pension and other postretirement benefits, valuation allowance on deferred tax assets and the Allowance for credit losses on our trade receivables. Additional critical accounting policies are included within the list below:
Revenue recognition and trade receivables
We recognize revenue when (or as) we satisfy our performance obligation which is when the customer obtains control of the good or service. Rebates due to customers are accrued as a reduction of revenue in the same period that the related sales are recorded based on the contract terms. Refer to Note 3 to our consolidated financial statements included in this Form 10-K for more information.
We record amounts billed for shipping and handling fees as revenue. Costs incurred for shipping and handling are recorded as costs of sales and services. Amounts billed for sales and use taxes, value-added taxes, and certain excise and other specific transactional taxes imposed on revenue-producing transactions are presented on a net basis and excluded from revenue on the consolidated statements of income (loss). We record a liability until remitted to the respective taxing authority.
We periodically enter into prepayment arrangements with customers and receive advance payments for product to be delivered in future periods. These advance payments are recorded as deferred revenue and classified as "Advance payments from customers" on the consolidated balance sheet. Revenue associated with advance payments is recognized as shipments are made and transfer of control to the customer takes place.
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Trade receivables consist of amounts owed to us from customer sales and are recorded when revenue is recognized. The allowance for trade receivables represents our best estimate of the probable losses associated with potential customer defaults. In developing our allowance for trade receivables, we use a two-stage process which includes calculating a general formula to develop an allowance to appropriately address the uncertainty surrounding collection risk of our entire portfolio and specific allowances for customers where the risk of collection has been reasonably identified either due to liquidity constraints or disputes over contractual terms and conditions.
Our method of calculating the general formula consists of estimating the recoverability of trade receivables based on historical experience, current collection trends, and external business factors such as economic factors, including regional bankruptcy rates, and political factors. Our analysis of trade receivable collection risk is performed quarterly, and the allowance is adjusted accordingly.
We also hold long-term receivables that represent long-term customer receivable balances related to past-due accounts which are not expected to be collected within the current year. Our policy for the review of the allowance for these receivables is consistent with the discussion in the preceding paragraph above on trade receivables. Therefore, on an ongoing basis, we continue to evaluate the credit quality of our long-term receivables utilizing aging of receivables, collection experience and write-offs, as well as existing economic conditions, to determine if an additional allowance is necessary.
We believe our allowance for credit losses is a critical accounting estimate because the underlying assumptions used for the reserve can change from time to time and potentially have a material impact on our results of operations. Based on a combination of historical trends as well as current economic factors, we apply judgment to reserve for expected credit losses in the period in which the sale is recorded. A substantial change in the operating environments in any of our key locations (driven by weather conditions, industry specific events, and macroeconomic conditions) may result in actual adjustments that differ from our original assumptions.
Environmental obligations and related recoveries
We provide for environmental-related obligations when they are probable and amounts can be reasonably estimated. Where the available information is sufficient to estimate the amount of liability, that estimate has been used. Where the information is only sufficient to establish a range of probable liability and no point within the range is more likely than any other, the lower end of the range has been used.
Estimated obligations to remediate sites that involve oversight by the United States Environmental Protection Agency ("EPA"), or similar government agencies, are generally accrued no later than when a Record of Decision ("ROD"), or equivalent, is issued, or upon completion of a Remedial Investigation/Feasibility Study ("RI/FS"), or equivalent, that is submitted by us to the appropriate government agency or agencies. Estimates are reviewed quarterly by our environmental remediation management, as well as by financial and legal management and, if necessary, adjusted as additional information becomes available. The estimates can change substantially as additional information becomes available regarding the nature or extent of site contamination, required remediation methods, and other actions by or against governmental agencies or private parties.
Our environmental liabilities for continuing and discontinued operations are principally for costs associated with the remediation and/or study of sites at which we are alleged to have released hazardous substances into the environment. Such costs principally include, among other items, RI/FS, site remediation, costs of operation and maintenance of the remediation plan, management costs, fees to outside law firms and consultants for work related to the environmental effort, and future monitoring costs. Estimated site liabilities are determined based upon existing remediation laws and technologies, specific site consultants’ engineering studies or by extrapolating experience with environmental issues at comparable sites.
Included in our environmental liabilities are costs for the operation, maintenance and monitoring of site remediation plans ("OM&M"). Such reserves are based on our best estimates for these OM&M plans. Over time we may incur OM&M costs in excess of these reserves. However, we are unable to reasonably estimate an amount in excess of our recorded reserves because we cannot reasonably estimate the period for which such OM&M plans will need to be in place or the future annual cost of such remediation, as conditions at these environmental sites change over time. Such additional OM&M costs could be significant in total but would be incurred over an extended period of years.
Included in the environmental reserve balance, other assets balance and disclosure of reasonably possible loss contingencies are amounts from third-party insurance policies, which we believe are probable of recovery.
Provisions for environmental costs are reflected in income, net of probable and estimable recoveries from named Potentially Responsible Parties ("PRPs") or other third parties. See Note 10 to the consolidated financial statements included within this Form 10-K for further information. All other environmental provisions incorporate inflation and are not discounted to their present value.
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In calculating and evaluating the adequacy of our environmental reserves, we have taken into account the joint and several liability imposed by Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA") and the analogous state laws on all PRPs and have considered the identity and financial condition of the other PRPs at each site to the extent possible. We have also considered the identity and financial condition of other third parties from whom recovery is anticipated, as well as the status of our claimsagainst such parties. Although we are unable to forecast the ultimate contributions of PRPs and other third parties with absolute certainty, the degree of uncertainty with respect to each party is taken into account when determining the environmental reserve by adjusting the reserve to reflect the facts and circumstances on a site-by-site basis. Our liability includes our best estimate of the costs expected to be paid before the consideration of any potential recoveries from third parties. We believe that any recorded recoveries related to PRPs are realizable in all material respects. Recoveries are recorded as either an offset in " Environmental liabilities, continuing and discontinue d" or as " Other assets " in our consolidated balance sheets in accordance with U.S. accounting literature.
See Note 10 to our consolidated financial statements included within this Form 10-K for changes in estimates associated with our environmental obligations.
Impairments and valuation of long-lived and indefinite-lived assets
Our long-lived assets primarily include property, plant and equipment and intangible assets. Historically, our long-lived assets also included goodwill; however, we recorded a write-off of our remaining goodwill balance during the year ended December 31, 2025. Refer below for further detail of the write-off.
We test for impairment whenever events or circumstances indicate that the net book value of our property, plant and equipment may not be recoverable from the estimated undiscounted expected future cash flows expected to result from their use and eventual disposition. In cases where the estimated undiscounted expected future cash flows are less than net book value, an impairmentloss is recognized equal to the amount by which the net book value exceeds the estimated fair value of assets, which is based on discounted cash flows at the lowest level determinable. The estimated cash flows reflect our assumptions about selling prices, volumes, costs and market conditions over a reasonable period of time.
We perform an annual impairment test of our indefinite-lived intangible assets and, historically, our goodwill, in the third quarter of each year, or more frequently whenever an event or change in circumstances occurs that would require reassessment of the recoverability of those assets. Our fiscal year 2025 annual impairment test was performed during the third quarter ended September 30, 2025. At the time of the annual impairment test, we determined no goodwill impairment or indefinite-lived asset impairment existed and the fair value was in excess of the carrying value for each asset class. As a result of the significant decrease in our stock price during the fourth quarter of 2025, we also performed a test of our goodwill and other intangible assets for impairment in connection with the preparation of our financial statements during the fourth quarter of 2025. We recorded a $1,356.2 million write-off of our remaining goodwill balance in connection with the impairment test. There was no impairment identified on our other intangible assets.
In performing our evaluation, we assess qualitative factors such as overall financial performance of our portfolio, anticipated changes in industry and market structure, competitive environments, planned capacity and cost factors such as raw material prices. We estimate the fair value of the reporting unit using a discounted cash flow model as part of the income approach. We assess the appropriateness of projected financial information by comparing projected revenue growth rates, profit margins and tax rates to historical performance, industry data and selected guideline companies, where applicable. Our key assumptions include future cash flow projections, tax rates, terminal growth rates and discount rates.
We employ the relief from royalty method of the income approach to value our brand portfolios (indefinite-lived intangible assets). The principle behind this method is that the value of the intangible asset is equal to the present value of the after-tax royalty savings attributable to owning the intangible asset. Primary inputs and key assumptions include revenue forecasts attributable to each portfolio, royalty rates (considering both external market data and internal arrangements), tax rates, terminal growth rates and discount rates.
Estimating the fair value requires significant judgment and actual results may differ due to changes in the overall market conditions. We believe we have applied reasonable assumptions which considers both internal and external factors.
We believe that an accounting estimate relating to asset impairment is a critical accounting estimate because of the inherent uncertainty within the underlying assumptions. An adverse change in any of these assumptions could result in an impairment charge which would potentially have a material impact on our results of operations.
See Note 7 to our consolidated financial statements included within this Form 10-K for charges associated with long-lived asset disposal costs and the activity associated with the restructuring reserves.
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Pension and other postretirement benefits
We provide qualified and nonqualified defined benefit and defined contribution pension plans, as well as postretirement health care and life insurance benefit plans to our employees and retirees. The costs (benefits) and obligations related to these benefits reflect key assumptions related to general economic conditions, including interest (discount) rates, healthcare cost trend rates, expected rates of return on plan assets and the rates of compensation increase for employees. The costs (benefits) and obligations for these benefit programs are also affected by other assumptions, such as average retirement age, mortality, employee turnover, and plan participation. To the extent our plans’ actual experience, as influenced by changing economic and financial market conditions or by changes to our own plans’ demographics, differs from these assumptions, the costs and obligations for providing these benefits, as well as the plans’ funding requirements, could increase or decrease. When actual results differ from our assumptions, the difference is typically recognized over future periods. In addition, the unrealized gains and losses related to our pension and postretirement benefit obligations may also affect periodic benefit costs (benefits) in future periods.
We use several assumptions and statistical methods to determine the asset values used to calculate both the expected rate of return on assets component of pension cost and to calculate our plans’ funding requirements. We apply the fair value approach for our liability-hedging asset class, which does not involve deferring the impact of excess plan asset gains or losses in the determination of these two components of net periodic benefit cost. This class of assets is comprised solely of fixed income securities and therefore, provides a natural hedge (liability-hedging assets) against the changes in the recorded amount of net periodic benefit cost. We use an actuarial value of assets to determine our plans’ funding requirements. The actuarial value of assets must be within a certain range, high or low, of the actual market value of assets, and is adjusted accordingly.
We select the discount rate used to calculate pension and other postretirement obligations based on a review of available yields on high-quality corporate bonds as of the measurement date. In selecting a discount rate as of December 31, 2025, we placed particular emphasis on a discount rate yield-curve provided by our actuary. This yield-curve, when populated with projected cash flows that represent the expected timing and amount of our plans' benefit payments, produced an effective discount rate of 5.32 percent for our U.S. qualified plan, 4.71 percent for our U.S. nonqualified, and 4.89 percent for our U.S. other postretirement benefit plans.
The discount rates used to determine projected benefit obligation at our December 31, 2025 and 2024 measurement dates for the U.S. qualified plan were 5.32 percent and 5.60 percent, respectively. The effect of the change in the discount rate from 5.60 percent to 5.32 percent at December 31, 2025 resulted in a $20.4 million increase to our U.S. qualified pension benefit obligations. The effect of the change in the discount rate used to determine net annual benefit cost (income) from 4.97 percent at December 31, 2024 to 5.32 percent at December 31, 2025 resulted in a $2.2 million decrease to the 2025 U.S. qualified pension expense.
The change in discount rate from 5.60 percent at December 31, 2024 to 5.32 percent at December 31, 2025 was attributable to an increase in yields on high quality corporate bonds with cash flows matching the timing and amount of our expected future benefit payments between the 2024 and 2025 measurement dates. Using the December 31, 2025 and 2024 yield curves, our U.S. qualified plan cash flows produced a single weighted-average discount rate of approximately 5.32 percent and 5.60 percent, respectively.
In developing the assumption for the long-term rate of return on assets for our U.S. Plan, we take into consideration the technical analysis performed by our outside actuaries, including historical market returns, information on the assumption for long-term real returns by asset class, inflation assumptions, and expectations for standard deviation related to these best estimates. Our long-term rate of return for the fiscal year ended December 31, 2025, 2024 and 2023 was 5.25 percent, 4.50 percent and 4.75 percent, respectively.
For the sensitivity of our pension costs to incremental changes in assumptions see our discussion below.
Sensitivity analysis related to key pension and postretirement benefit assumptions.
A one-half percent increase in the assumed discount rate would have decreased pension and other postretirement benefit obligations by $35.5 million and $36.4 million at December 31, 2025 and 2024, respectively, and increased pension and other postretirement benefit costs by $0.3 million, $0.3 million and $0.5 million for 2025, 2024 and 2023, respectively. A one-half percent decrease in the assumed discount rate would have increased pension and other postretirement benefit obligations by $38.0 million and $39.1 million at December 31, 2025 and 2024, respectively, and decreased pension and other postretirement benefit costs by $0.2 million in 2025, $0.2 million in 2024, and $0.1 million in 2023.
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A one-half percent increase in the assumed expected long-term rate of return on plan assets would have decreased pension costs by $4.6 million, $5.0 million and $5.0 million for 2025, 2024 and 2023, respectively. A one-half percent decrease in the assumed long-term rate of return on plan assets would have increased pension costs by $4.6 million, $5.0 million and $5.0 million for 2025, 2024 and 2023, respectively.
Further details on our pension and other postretirement benefit obligations and net periodic benefit costs (benefits) are found in Note 13 to our consolidated financial statements in this Form 10-K.
Income taxes
We have recorded a valuation allowance to reduce deferred tax assets in certain jurisdictions to the amount that we believe is more likely than not to be realized. In assessing the need for this allowance, we have considered a number of factors including future taxable income, the jurisdictions in which such income is earned and our ongoing tax planning strategies. In the event that we determine that we would not be able to realize all or part of our net deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to income in the period such determination was made. Similarly, should we conclude that we would be able to realize certain deferred tax assets in the future in excess of the net recorded amount, an adjustment to the deferred tax assets would increase income in the period such determination was made.
Additionally, we file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. Certain income tax returns for FMC entities taxable in the U.S. and significant foreign jurisdictions are open for examination and adjustment. We assess our income tax positions and record a liability for all years open to examination based upon our evaluation of the facts, circumstances and information available at the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, we have recorded the largest amount of tax benefit with a greater than 50 percent likelihood of being realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. We adjust these liabilities, if necessary, upon the completion of tax audits or changes in tax law.
See Note 11 to our consolidated financial statements included within this Form 10-K for additional discussion surrounding income taxes.
